The adequacy of the representative plaintiff may not be the highest hurdle for certification, but the Alberta courts remind us that the requirement still demands meaningful scrutiny. In Sullivan v. Golden Intercapital (GIC) Investments Corp., the Alberta Court of Queen’s Bench recently refused to certify a class action on the basis that none of the proposed representative plaintiffs were capable of prosecuting the action or vigorously representing the interests of the class.
Importance Of A Suitable Representative
All class actions require at least one representative plaintiff to represent the interests of the absent class members. That person has serious responsibilities, such as instructing counsel, considering settlement offers, and negotiating retainer agreements – all on behalf of class members who may not even be aware that a class action has been commenced. For more on the legal prerequisites for a person to take on this important role, see our blog post from February: What Makes a Plaintiff a Suitable Representative Plaintiff?
Factoring Against A Representative Plaintiff
In Sullivan, two representative plaintiffs were put forward to represent a class of approximately 35 individuals who had dealt with Golden Capital Investments Corp, a real estate service company that bought foreclosed on homes and rented them back to their owners. Of the original two representatives, one of them died and the other disappeared, leading class counsel to propose two replacements. The substitutes were members of the class, but Justice Thomas found that neither of them could adequately represent the class.
The Court considered the following to factor against the suitability of the representatives:
- Neither proposed representative plaintiff could explain under cross-examination the role of a representative plaintiff in a class action.
- Neither understood that the representative plaintiff could be liable for legal costs in the event that the action is not successful.
- Neither could explain the role of a litigation plan in a class action.
Additionally, one of the proposed representative plaintiffs had earlier launched a lawsuit against Golden Capital Investments Corp but was unable to explain on cross-examination anything about that earlier action. She was not even sure that an action had been commenced in her name. She had been a “passive participant” and was “disinterested in her own lawsuit,” not the sort of informed and engaged plaintiff required for a class action. Based on this history, Justice Thomas was not satisfied that the representative could “vigorously and capably” conduct the class proceeding on behalf of the entire class.
Developing Defense To “Lawyer-Driven” Class Actions?
Sullivan is yet another Alberta case in a series that meaningfully scrutinized the proposed representative plaintiffs and found them to come up wanting. In January, we wrote about a similar case, Condominium Corporation No. 1122235 v. Surbey, where the Court found that the failure of a proposed representative to explain why some possible defendants were not included in the action suggested that he was not sufficiently informed. For more on that case, read our post: Court Denies Certification Where Some Defendants Left Out.
In an environment where certification is becoming increasingly prevalent, it is important to keep in mind that the statutory prerequisites to certification are intended to be meaningful screening mechanisms. Sullivan and Surbey are a useful reminder of that fact. Even the identification of representative plaintiffs entails more than cursory examination.
For class actions to fulfill their intended function and overcome the too common criticism of being “lawyer-driven,” judges must carefully scrutinize the adequacy of the person put forward to represent the interests of the class. This means that defense counsel should not shy away from a probing cross-examination of the proposed representative, asking the sorts of questions demanded bySullivan and Surbey. An “empty vessel controlled by the litigation lawyer,” to borrow Justice Thomas’ words from Sullivan, is in no one’s interest.