The Ontario Divisional Court recently granted leave to appeal in Johnston v. Sheila Morrison Schools, a certified class action involving allegations of negligence and breach of fiduciary duty against a school and its headmaster. The primary issue on appeal is whether students may make claims against schools on a several basis and thereby avoid exposing their parents to counterclaims or third-party claims.
The certification order provided for three classes of plaintiffs: (i) residential students, (ii) day students, and (iii) family members of residential students. A statement of defence was filed prior to certification. Following certification, the defendants sought to amend their defence to add third-party claims against the parents and guardians of the students, on the basis that the parents and guardians were allegedly aware of the school’s practices and thus should also be liable for any damages sustained by the students. The parents (but not the guardians) are members of the third certified class.
The motions judge allowed the defendants to add third-party claims, but stayed these claims (which did not raise common issues) until individual students proceed to individual issues trials. The motions judge held that the representative plaintiffs would not be prejudiced, that third-party claims are not precluded under the Class Proceedings Act, and that the law permits claims for contribution and indemnity from parents or guardians.
The Divisional Court granted leave to appeal on two bases:
- The student classes have limited their claims to the several (or proportionate) liability of the defendants alone and are not seeking to recover any damages attributable to the fault of any other person. Applying precedent from the Ontario Court of Appeal, the Divisional Court wrote, in granting leave to appeal, that there is good reason to doubt the motion judge’s decision, which would allow the defendants to seek contribution and indemnity with respect to damages (attributable to the parents and guardians) that are not being claimed.
- Rule 29.01 of the Rules of Civil Procedure provides that a third-party claim may be made “against any person who is not a party to the action.” As the parents are members of the third certified class, the Divisional Court queried whether they are a “party” to the action and thus outside the scope of Rule 29.01, in which case a counterclaim as against them (under Rule 27) would have been the correct procedure. The Divisional Court noted that whether a class member becomes a party to the action for the purposes of Rule 29.01 appears to be a matter of first instance and was not considered in detail by the motions judge.
As recognized by the Divisional Court, this case raises a significant issue, with access to justice implications, as to whether students or residents may sue schools or other institutions on a several basis, so as to prevent the schools or other institutions from launching a third-party claim or counterclaim against the students’ parents and guardians.
Johnston v. Sheila Morrison Schools, 2011 ONSC 5591 (CanLII)
Divisional Court Docket Number: CV-09-379550-00CP
Date Leave Granted: September 23, 2011