



COURT OF APPEAL FOR ONTARIO

CITATION: Bancroft-Snell v. Visa Canada
    Corporation, 2019 ONCA 822

DATE: 20191017

DOCKET: M49808, M50041 & M50130 (C66008)

Strathy C.J.O., MacPherson,
    Sharpe, Tulloch and Benotto JJ.A.

DOCKET: M50130

BETWEEN

Jonathon Bancroft-Snell
, and
1739793 Ontario Inc.

Plaintiffs
(Moving Parties)

Visa
    Canada Corporation
,
Mastercard
    International Incorporated
, Bank of America Corporation,
Bank of Montreal
,
Bank of Nova
    Scotia
,
Canadian Imperial Bank of Commerce
,
    Capital One Financial Corporation, Citigroup Inc., Federation des caisses
    Desjardins du Quebec,
National Bank of Canada Inc.
,
Royal Bank of Canada
, and
Toronto-Dominion
    Bank.

Defendants
(Moving Parties)

AND BETWEEN

DOCKET: M49808

Jonathon Bancroft-Snell
, and
1739793 Ontario Inc.

Plaintiffs
(Responding Parties)

Visa
    Canada Corporation
,
Mastercard
    International Incorporated
, Bank of America Corporation,
Bank of Montreal
,
Bank of Nova
    Scotia
,
Canadian Imperial Bank of Commerce
,
    Capital One Financial Corporation, Citigroup Inc., Federation des caisses
    Desjardins du Quebec,
National Bank of Canada Inc.
,
Royal Bank of Canada
, and
Toronto-Dominion
    Bank.

Defendants
(Responding Parties)

AND BETWEEN

DOCKET: M50041

Jonathon Bancroft-Snell
, and
1739793 Ontario Inc.

Plaintiffs
(Responding Parties)

Visa
    Canada Corporation
,
Mastercard
    International Incorporated
, Bank of America Corporation,
Bank of Montreal
,
Bank of Nova
    Scotia
,
Canadian Imperial Bank of Commerce
,
    Capital One Financial Corporation, Citigroup Inc., Federation des caisses
    Desjardins du Quebec,
National Bank of Canada Inc.
,
Royal Bank of Canada
, and
Toronto-Dominion
    Bank.

Defendants
(Responding Parties)

Reidar Mogerman and Katie Duke, for
    Jonathan Bancroft-Snell and 1739793 Ontario Inc., moving parties (M50130),
    responding parties (M49808 & M50041)

Robert E. Kwinter, for Visa Canada
    Corporation, moving party (M50130), responding party (M49808 & M50041)

Jeffrey B. Simpson and James B.
    Musgrove, for Mastercard International Incorporated, moving party (M50130),
    responding party (M49808 & M50041)

Katherine L. Kay, for Bank of Montreal,
    Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada
    and Toronto-Dominion Bank, moving parties (M50130), responding parties (M49808
    & M50041) (no submissions made)

Sean Griffin and Antoine Brylowski, for
    National Bank of Canada Inc., moving party (M50130), responding party (M49808
    & M50041)

James C. Orr and Kyle R. Taylor, for
    Home Depot of Canada Inc., moving party (M49808), responding party (M50130)

Edward J. Babin, Cynthia L. Spry, and
    Michael Bookman, for Wal-Mart Canada Corp., moving party (M50041), responding
    party (M50130)

Heard: September 4, 2019

Strathy C.J.O.:

[1]

This appeal focuses on the procedural rights of
    class members in certified class proceedings, specifically the right to
    challenge settlement approval orders by way of appeal under the
Class
    Proceedings Act,
1992, S.O. 1992, c. 6

(
CPA
).

[2]

The nature of a class proceeding and the goals
    of the
CPA
impact the procedural rights afforded to class members.
    Class actions permit the efficient resolution of disputes in a manner that is
    fair to all parties and promote access to justice, judicial economy and
    behaviour modification. In part, efficiency is achieved through the appointment
    of one or more class members as representative plaintiffs, to conduct the
    litigation in the best interests of all class members.

[3]

While class members have a
sui generis
status,
    they do not possess the same degree of autonomy as parties to the litigation
    and do not enjoy the rights or bear the responsibilities of parties. Class
    members have a right to notice of a certified class proceeding, the right to
    opt out of the class, and the right to object to settlement agreements.
    However, class members who do not choose to opt out of the class proceeding,
    are bound by the outcome. A settlement of a class proceeding that is approved
    by the court binds all class members.

[4]

In contrast to class members who do not play an
    active role, the representative plaintiff has carriage of the litigation on
    behalf of the class and, with the advice of class counsel, makes all litigation
    decisions on behalf of the class, including the decision to accept or reject a
    defendants settlement offer. Significantly, it is the representative plaintiff
    who bears the litigation risk, including the risk of an adverse costs award.

[5]

In the present appeal, two class members,
    Wal-Mart and Home Depot (the responding parties to Motion M50130, responding
    parties), neither of which is a representative plaintiff, have appealed an
    order of Perell J. of the Superior Court of Justice approving a partial
    settlement of this certified class action. They did not avail themselves of an
    opportunity to opt out of the class action at the time of an earlier
    settlement. Accordingly, subject to their right to object at the settlement
    approval hearing, they were bound by any judgment or settlement in the class
    action. They took advantage of the opportunity to object before the settlement
    approval judge, who did not give effect to their objections.

[6]

The moving parties moved to quash the appeal on
    the ground that the responding parties have no standing to appeal. This motion
    is supported by the representative plaintiff and by three defendants, Visa,
    Mastercard, and National Bank. There are related motions before us: one by
    Wal-Mart, pursuant to s. 30(5) of the
CPA
, seeking leave to act as the
    representative plaintiff for the purpose of the appeal; and one by Home Depot,
    for an order granting leave to act as the representative plaintiff in the event
    that the moving parties motion is granted.

[7]

A five-judge panel was convened, at the request
    of the responding parties, to enable them to advance the submission that the
    decision of this court in
Dabbs v. Sun Life Assurance Company of Canada
(1998), 41 O.R. (3d) 97 (C.A.), leave to appeal refused, [1998] S.C.C.A. No.
    372 (
Dabbs
), should be overruled. That decision held that a class
    member has no right to appeal a settlement approval order.

[8]

I would dismiss the responding parties motions,
    grant the moving parties motion, and quash the appeal. My reasons are set out
    below.

I.

Dabbs
remains
    good law and has not been overtaken by other decisions

[9]

Dabbs
held that
    class members rights of appeal in class proceedings are found in the
CPA
and are not supplemented by the general appeal rights in s. 6(1)(b) of the
Courts
    of Justice Act
, R.S.O. 1990 c. C.43 (the 
CJA
).

[10]

The responding parties contend that subsequent
    decisions have established that s. 6(1)(b) of the
CJA
can provide an
    appeal route where the matter is not specifically addressed in the
CPA
.

[11]

I do not accept this submission.
Dabbs
remains good law. It has stood for more than 20 years and has been consistently
    applied in Ontario: see e.g.
Cavanaugh v. Grenville Christian College
,
    2013 ONCA 139, 360 D.L.R. (4th) 670;
Locking v. Armtec Infrastructure Inc.
,
    2012 ONCA 774, 299 O.A.C. 20;
Davies v. Clarington (Municipality)
,
    2010 ONSC 418. Its logic and authority have never been questioned. It was
    expressly applied in the decision of this court in
Directright Cartage Ltd.
    v. London Life Insurance Co.
, 2002 O.J. No. 512 (C.A.). See also
Labourers
    Pension Fund of Central and Eastern Canada
, 2013 ONCA 500, 12 C.B.R. (6th)
    124, leave to appeal refused, [2013] S.C.C.A. No. 395.

[12]

The responding parties have not demonstrated
    that the
ratio
of
Dabbs
is flawed in any way. Appeal rights
    are statutory.
Dabbs
was decided on the basis of statutory interpretation.
    The responding parties have not advanced any other persuasive interpretation of
    the
CPA
.

[13]

The responding parties submission that
Dabbs
has been superseded by subsequent decisions is not borne out by an analysis
    of those decisions, none of which involved an appeal by a class member who was
    not a representative party. All of those decisions are readily distinguished on
    that basis:
Welsh v. Ontario
, 2019 ONCA 41, 432 D.L.R. (4th) 117 (the
    appellant was the representative plaintiff);
Airia Brands Inc. v. Air
    Canada
, 2017 ONCA 792, leave to appeal refused, [2017] S.C.C.A. N. 476
    (the appellants were the representative plaintiffs);
Waldman v. Thomson
    Reuters Canada Limited
, 2015 ONCA 53 (the appellant was a party to the
    action);
Sutts, Strosberg LLP v. Atlas Cold Storage Holdings Inc.
,
    2009 ONCA 690, 311 D.L.R. (4th) 323 (the appellants were class counsel);
Main
    v. The Hershey Company
, 2011 BCCA 21, 20 B.C.L.R. (5th) 11, leave to appeal
    refused, [2011] S.C.C.A. No. 105 (the appellants were non-settling defendants).

[14]

Dabbs
was cited
    with approval by the Court of Appeal for British Columbia in
Coburn and
    Watsons Metropolitan Home v. Home Depot of Canada Inc.
, 2019 BCCA 308 (
Coburn
),
    released August 30, 2019. That case, a class proceeding related to this, raised
    precisely the same issue as these motions. The court found the reasoning in
Dabbs
compelling: at para. 32. It rejected the responding parties submission that
    the authority of
Dabbs
had been undermined by more recent case law.
    The court observed, at para. 34:

None of the cases directly questioned the
    authority of
Dabbs
and some do not refer to it. Rather, the cases deal
    with different issues and rest on the principle that if the availability of
    appeal rights are not effectively addressed by the
CPA
, then the
    general jurisdiction to entertain appeals governs.

[15]

I agree with this observation.

[16]

In summary, appeal rights in class proceedings
    can be described as follows:

·

The effect of s. 30 of the
CPA
is that
    the Divisional Court and the Court of Appeal have divided appellate
    jurisdiction with respect to appeals of various types of orders and judgments
    in class proceedings.
Parties
have those appeal
    rights that are expressly designated by s. 30. Appeals, both as of right and
    with leave, must be taken to the court stipulated in s. 30.

·

Where s. 30 does not specifically address the
    appeal route for a particular type of order or judgment, s. 6(1)(b) of the
Courts
    of Justice Act
, R.S.O. 1990, c. C.43 will govern whether an appeal lies to
    this court or to Divisional Court. Accordingly,
parties
may appeal final orders of those matters not specifically mentioned in s. 30 of
    the
CPA
to the Court of Appeal.

·

Class members
who are not representative parties have no direct right of appeal
    pursuant to s. 30 of the
CPA
. If a representative plaintiff does not
    appeal pursuant to s. 30(3) or abandons an appeal pursuant to s. 30(3), class
    members have a right to seek leave to appeal pursuant to s. 30(5). That right
    exists only in respect of those matters specified in s. 30(3), those being
    judgments on common issues or determinations of aggregate damages.

[17]

As the responding parties have no direct right
    of appeal, I turn to the issue of whether they may seek leave to appeal
    pursuant to s. 30(5).

II.

Settlement approval is neither a judgment on
    common issues nor a determination of aggregate damages

[18]

The responding parties second argument is that
    a settlement approval order should be understood as a judgment on common
    issues or a determination of aggregate damages, with the result that a class
    member may appeal the disposition with leave if the representative plaintiff
    fails to pursue an appeal, pursuant to ss. 30(3) and 30(5) of the
CPA
.
    The responding parties rely on
Dabbs
at paras. 18 to 21, in which
    OConnor J.A. considered, and dismissed, a motion by class members for leave
    pursuant to s. 30(5) of the
CPA
.

[19]

I would reject this submission. There is nothing
    in the settlement agreement, the order approving the agreement, or the reasons
    of the class proceedings judge to indicate that the court was pronouncing
    judgment on a common issue or making an aggregate assessment of damages. It was
    simply a determination that the settlement was fair and reasonable and in the
    best interests of the class. I respectfully agree with the observation of
    Harris J.A. in
Coburn
, who rejected a similar submission, observing at
    para. 21:

In my opinion, a judgment on a common issue
    involves an adjudication by a court of contested issues. It does not capture an
    order approving a settlement in which, typically, liability is disavowed as a
    condition of the settlement.

[20]

To avoid any future uncertainty on the point, I reject
    the responding parties suggestion that the final four paragraphs of
Dabbs
confirm that a class member may appeal the approval of a settlement, with
    leave, under s. 30(5) of the
CPA
. The court in
Dabbs
indicated
    that it would have denied leave in any event and did not address the
    substantive basis of this argument. In my view, for the reasons I have given, a
    settlement approval is not a judgment on the common issues and s. 30(5) is
    inapplicable.

III.

Giving individual class members the right to
    appeal the settlement of class action would lead to uncertainty and
    inefficiency

[21]

Third, and finally, the responding parties argue
    that because the vast majority of class proceedings are resolved through settlement,
    it would be unreasonable to accept that the legislature intended that there be
    no avenue of appellate review of settlement approvals. Because access to
    justice and the protection of class members is a primary purpose of the
CPA
,
    it would be unreasonable, they say, to deny class members an opportunity to
    appeal.

[22]

I respectfully disagree. There are sound policy
    reasons why class members should not be entitled to appeal a settlement order
    where the representative plaintiff declines to do so. The Court of Appeal for
    British Columbia identified some of these reasons in
Coburn
, at paras.
    14 and 15. To permit a class member to appeal a settlement proposed by the
    representative plaintiff, recommended by class counsel, and approved by the
    class proceedings judge, would be problematic in several ways. It would introduce
    uncertainty into the negotiation and approval of class action settlements,
    undermine the authority of the representative plaintiff and class counsel, and impede
    settlement. As the moving parties note, abuses have been experienced in the
    United States where appeals by objecting class members have been permitted.
    See:
Abihsira v. Johnston
, 2019 QCCA 657, [2019] J.Q. No. 2785, at
    para. 85; B. D. Greenberg, Keeping the Flies Out of the Ointment: Restricting
    Objectors to Class Action Settlements (2010) 84 St. Johns L. Rev. 949 at 951.

[23]

Notably, the Ontario Law Commission, in its recent
    report, Class Actions: Objectives, Experiences and Reforms, made no
    recommendation to this effect, although it did make recommendations concerning
    appeal routes for parties.

IV.

Disposition

[24]

For these reasons, I would dismiss the responding
    parties motions, grant the moving parties motion and quash the appeal.

[25]

In the event the parties are unable to agree on
    costs, they may make written submissions.

Released: G.S.   OCT 17 2019

G.R. Strathy C.J.O.

I agree. J.C. MacPherson J.A.

I agree. Robert J. Sharpe J.A.

I agree. M. Tulloch J.A.

I agree. M.L. Benotto J.A.


