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Multi-Jurisdictional Class Actions: The Creation of Barriers by the BC Court of Appeal

Posted in Case Comments, Class Actions, Constitutional

In a surprise decision, the British Columbia Court of Appeal has broken with the superior courts of British Columbia, Ontario and Quebec by holding that constitutional limits prevent a superior court judge from sitting outside of his own province. The Court of Appeal’s decision suggests limits to the inherent jurisdiction and discretion of superior courts and will have profound effects upon the ease and efficiency with which judges can hear multi-jurisdictional matters, in particular class actions. Decisions by the Court of Appeal in Ontario and Quebec  on the same issue are pending.

Background

Concurrent class proceedings were certified in Ontario, British Columbia and Quebec on behalf of individuals infected with Hepatitis C between 1986 and 1990 culminating in a national settlement agreement in 1999 (the “Settlement Agreement”). The Settlement Agreement provides independent supervisory power over the litigation settlement within its jurisdiction to the superior courts of each of British Columbia, Ontario and Quebec. However, the Settlement Agreement also provides that any order by a court will only take effect once there are materially identical orders of the other two courts.

Since 1999, various applications have been brought before the courts, the majority on consent, resulting in similar orders from each of the courts. In the present application, class counsel seek to resolve the issue of jurisdiction and propose that the most efficient method of adjudicating future motions involves the three supervisory judges sitting together in one location to hear the same submissions, positioning the judges to reach similar orders, as required by the Settlement Agreement.

Decisions Below

The Ontario application, Parsons v. Canadian Red Cross Society, 2013 ONSC 3053 [Parsons], was heard by Chief Justice Winkler who held that jurisdiction is not lost and a judge of the Superior Court of Ontario may preside over a hearing outside of Ontario where the Ontario court has personal and subject matter jurisdiction over the parties and issues. Winkler C.J. held that the court’s inherent jurisdiction to control its own process empowered the court to hold such a hearing where it promotes the interests of justice.

In reaching this conclusion, Winkler C.J. held that the English common law rule prohibiting English courts from sitting outside of England should not be applied to prohibit superior courts in Canada from sitting outside their home province. Instead, Winkler C.J.O relied on the Supreme Court’s decision in Morguard Investments Ltd. v. De Savoye, [1990] 3 S.C.R. 1077 for the principle that relationships between foreign countries in the 19th century are distinct from inter-provincial relationships of today. Winkler C.J. held that this English common law rule is not suited to the modern realities of complex litigation involving parties and subject matters that transcend provincial borders and that a provincial court sitting in another province does not engage issues of sovereignty between foreign states. Winkler C.J. also relied upon two components of inherent jurisdiction referenced in MacMillan Bloedel Ltd. v. Simpson, [1995] 4 SCR 725, namely, ensuring convenience and fairness in legal proceedings and preventing steps being taken that would render judicial proceedings inefficacious.

The British Columbia application, Endean v. Canadian Red Cross Society, 2013 BCSC 1074, was heard by Bauman C.J., who adopted the reasons of Winkler C.J. in Parsons as accurately stating the law in British Columbia. In addition, Bauman C.J. found that there were no constitutional principles or rules preventing a judge in British Columbia from sitting outside of the province. Bauman C.J. discussed the possibility that a joint hearing could be conducted by video link and concluded that it was nonsensical for a video conference to be acceptable, but for the physical presence of judges from different jurisdictions to be prohibited in rare circumstances where the court found that such a hearing was in the interests of justice.

Finally, the Quebec application, Honhon v Canada (Attorney General), 2013 QCCS 2782 was heard by Chief Justice Rolland who agreed with the analysis of Winkler C.J. and concluded that there was nothing in the Canadian constitution, provincial statutes or legislative instruments from preventing the Quebec Superior Court from sitting outside of Quebec.

Decision

The Court of Appeal of British Columbia overturned the lower court’s decision and concluded that British Columbia judges cannot conduct hearings that take place outside their jurisdiction, but are able to conduct a hearing by telephone, video conference or other medium when a judge is located outside the province so long as the hearing is held in British Columbia.

In rendering this decision, the Court relied upon the English common rule prohibiting a judge from sitting outside their jurisdiction which was received in British Columbia on November 19, 1858. The Court also relied upon Ewachniuk v. Law Society of British Columbia (1998), 156 D.L.R. (4th) 1 [Ewachniuk], where Rowles J.A. stated that domestic courts do not sit outside their boundaries. While acknowledging the commentary of Rowles J.A. is non-binding, the Court concluded that Rowles J.A. accurately set out the common law. Further, the Court relied upon O.E.X. Electromagnetic Inc. v. Coopers & Lybrand (c.o.b. Coopers & Lybrand Consulting Group), [1991] B.C.J. No. 3465 [O.E.X.] and Norlympia Seafoods Ltd v Dal & Company Ltd, (no reasons, referenced in O.E.X.), both decisions where a trial judge found they could not hear evidence outside of British Columbia as a judge and so attended in the United States as an examiner and commissioner respectively to hear evidence. The Court also distinguished HMTQ v. Pilarinos, 2001 BCSC 1690, where a provincial superior court judge exercised discretion in the United States, on the basis that criminal jurisdiction was exercised on ex parte application, rather than an official sitting of the court.

The Court acknowledged that the common law is judge-made and can be subject to alteration as circumstances warrant, but concluded that this case is one where the extensive policy and procedural issues inherent in allowing judges to sit outside their provincial boundaries suggests this decision should be left to the legislature. As an example, the Court cites reciprocal legislation passed in Australia and New Zealand to allow the High Court of New Zealand and the Federal Court of Australia to hold hearings in the other country in certain proceedings. The Court also concluded that allowing judges to sit outside their jurisdiction endangers the open court principle allowing members of the public to attend a hearing in their province. The Court concluded that the circumstances of this case are unique and not such that it is appropriate to change the common law.

In the context of these proceedings, the Court concluded that a judge of the British Columbia Superior Court has the discretion to sit outside the province to hear concurrent applications under the Settlement Agreement, but that the British Columbia application must be conducted in a British Columbia courtroom, even where the judge is physically located outside the province.

Potential Significance

The Court’s decision in this case is significant for the precedential effect it will have on the hearing of other multi-jurisdictional  actions. It is notable that the cases referenced by the Court as precedent that a superior court judge cannot sit outside their province are largely cases that discuss a court’s ability to exercise jurisdiction when sitting in a foreign country, rather than a when sitting in a different province. In addition, the Court does not appear to give any weight to Fontaine v. Canada (Attorney General), 2012 BCSC 839 where judges of the superior courts of Ontario, British Columbia, Quebec, Alberta and Saskatchewan sat together in Alberta to hear a motion for approval of the Indian Residential Schools class action settlement with the superior courts of Manitoba, Yukon, Northwest Territories and Nunavut being linked by teleconference.

In a world where provincial borders are increasingly porous, jurisprudence is influential in courts across Canada and hearings are transmitted by videoconference, it appears to be a step backward to require superior court judges presiding over a hearing to adhere to the charade of “sitting” in a province, in which they are not physically located, as a result of English common law rules from 1858. Supreme Court jurisprudence tells us that superior courts possess inherent jurisdiction and should exercise this jurisdiction to ensure convenience and efficiency in legal proceedings. It will be interesting to see whether the Court of Appeal in Ontario and Quebec align themselves with the Court of Appeal of British Columbia and suggest boundaries between provinces are the same as those between foreign states, or whether they will follow the lead of the lower courts and grant superior courts jurisdiction that is efficacious and in keeping with inter-provincial mobility.

Case Information

Endean v. British Columbia, 2014 BCCA 61, [2014] B.C.J. No. 254

Docket: CA041078

Date of Decision: February 17, 2014