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CIVIL PROCEDURE - Class or representative actions - Certification

Tuesday, February 02, 2021 @ 6:17 AM  

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Appeal by the Attorney General from a decision granting the respondent’s motion for certification. The respondent sued for damages resulting from the delay in receiving his lump sum pension benefits after his retirement from the Canadian Armed Forces. He did not receive interest on the monies owing to him and claimed he was forced to go into debt and incur interest obligations to cover his basic living expenses during the period immediately following his release. The respondent alleged other retirees from the Armed Forces experienced similar delays in receiving their pension benefits and suffered similar losses as a result since 2007. The Federal Court found that the statement of claim disclosed reasonable causes of action for breach of fiduciary duty, breach of contract and negligence, and that the other requirements of the class proceedings rules with respect to certification were met. The Attorney General argued that the court made numerous errors in its legal analysis in determining that the statement of claim disclosed reasonable causes of action, that the Federal Court’s analysis of the remaining certification criteria was inadequate and that the form of the certification order failed to comply with the Federal Courts Rules.

HELD: Appeal allowed. The respondent was granted leave to amend the claim and to bring a new motion for certification. The Federal Court committed several errors in assessing whether the test for certification set out in Rule 334.16 of the Federal Courts Rules had been satisfied. It was not plain and obvious that the claims in contract and negligence did not disclose reasonable causes of action. The claim for breach of fiduciary duty would disclose a reasonable cause of action, if the statement of claim was amended to plead the existence of an undertaking on the part of the Pension Administrator to act in the best interests of members of the Reserve Plan. The Federal Court erred in failing to identify any common questions of law or fact for the class in its certification order. In the absence of any common issues of fact or law having been identified by the Federal Court, it was impossible to determine whether a class proceeding was the preferable procedure for resolving any common issues of fact or law that might be raised by this case. The Federal Court also committed a palpable and overriding error in finding the respondent to be a suitable representative plaintiff, given that the Federal Court limited the class to members of the Reserve Plan and the respondent qualified for a pension benefit under the Regular Plan and was ineligible to participate in the Reserve Plan. The respondent was thus not a member of the certified class. The certification order also failed to state the name of the representative plaintiff, the nature of the claims made on behalf of the class, the relief claimed, the common questions of law or fact for the class and specify the time and manner for class members to opt out of the class proceeding.

Canada (Attorney General) v. Jost, [2020] F.C.J. No. 1187, Federal Court of Appeal, A.L. Mactavish, W.W. Webb and J.M. Woods JJ.A., December 10, 2020. Digest No. TLD-February12021003