CITATION: McSheffrey v. Ontario, 2015 ONSC 4013

COURT FILE NO.: 02-CV-236588CP

COURT FILE NO.: 06-CV-324475PD3CP

DATE: 20150623

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

SUE McSHEFFREY

Plaintiff

– and –

HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO

Defendant

Susan Ursel for the Plaintiff

Alexandre T. Mouret for Class Member Virginia Bennett

Margaret Marcotte, self-represented

Judie Im for the Defendant

AND BETWEEN:

DIANNE LECLAIR

Plaintiff

– and –

HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO

Defendant

Stephen Moreau and Amanda Darrach for the Plaintiff

Elizabeth Holdsworth, Margaret Marcotte, and Frank Hamaker for the estate of Rosemary Hamaker, self-represented

Judie Im for the Defendant

Proceeding under the Class Proceedings Act, 1992

HEARD: June 11, 2015

PERELL, J.

REASONS FOR DECISION

A. INTRODUCTION

A. INTRODUCTION

1In 2005 and in 2007, two actions, McSheffrey v. Her Majesty the Queen and Leclair v. Her Majesty the Queen, were certified as class actions under the Class Proceedings Act, 1992, S.O. 1992, c. 6. The actions were case managed together, and in 2012, Justice Horkins approved a settlement.

2By this motion, the parties to the actions as well as the Ontario Public Service Employees Union (“OPSEU”), the Ontario Nurses’ Association (“ONA”), Class Counsel, the Administrator, and the Referee, seek to be discharged from the administration of the settlement. The Representative Plaintiffs, Ms. McSheffrey and Ms. Leclair, also seek approval of a cy-près order directing the undistributed settlement funds of $5,373.74 be distributed to the Ontario Employment Education and Research Council, a registered charity.

3On June 11, 2015, I granted the motion, in part, and I made the following endorsement:

This is a motion to complete the administration of two class actions that are subject to a settlement agreement. I am reserving judgment on whether to approve a cy-près or to direct a supplementary distribution plan. I grant the balance of the motion including the discharge of the administrator.

4For the reasons that follow, instead of making a cy-près order, I have decided to order a supplementary distribution of the balance of the settlement funds, as described below.

B. FACTUAL AND PROCEDURAL BACKGROUND

B. FACTUAL AND PROCEDURAL BACKGROUND

5In 1997, Ontario (the Defendant Her Majesty the Queen in Right of Ontario) created 43 Community Care Access Centres to deliver homecare programs previously delivered by municipalities and private entities. The employees who had previously delivered the services were transferred to the Centres.

6Before the transfer, the employees were enrolled in the Ontario Municipal Employees Retirement System ("OMERS") pension plan. However, the Centres were unable to enroll their employees in OMERS or to enroll their employees in the Victorian Order of Nurses pension plan. Instead, the employees were enrolled in the Health Care of Ontario Pension Plan. The employees were unhappy with the change, and they believed that their pension benefits had been degraded by the change in their pension plans. Two class actions followed.

7In 2005, McSheffrey v. Her Majesty the Queen was certified as a class action. The court certified the following class:

All former employees of municipal and other home-care service providers who subsequently became employees of CCACs and who were members of the Ontario Public Service Employees Union or the Association of Allied Health Professionals at the time of such change in their employment.

8In 2007, Leclair v. Her Majesty the Queen was certified as a class action. The court certified the following class:

All former employees of the municipal and other home care service providers who subsequently became employees of CCACs and who were members of the Ontario Nurses' Association ("ONA") at the time of such change.

9In December 2011, the parties reached a joint settlement under which they agreed to expand the class membership and Ontario agreed to pay $6.5 million to be distributed to the Class Members plus an additional $1 million for legal and administrative fees.

10By judgment dated November 30, 2012, Justice Horkins approved the settlement including a distribution program that was to be executed by the Representative Plaintiffs, OPSEU, ONA, the Administrator (NPT RicePoint Class Action Services Inc.), and Michael Eizenga, the Referee. See McSheffrey v. Ontario, 2012 ONSC 6803.

11There was an intensive notice program to Class Members to make claims:

• On January 18, 2013, the Long Form Notice was published in OPSEU’s newsletter. The same day, ONA sent the notice by direct mail to its members and OPSEU gave notice by email to approximately 900 members.

• On January 21, 2012, a direct email of the Long Form Notice was sent by ONA to four members and Long Form Notices were mailed by regular mail by OPSEU to 1,600 potential class members and by ONA to 5,763 potential class members.

• The Long Form Notice and Claims Forms were posted on OPSEU’s website on January 18, 2013 and ONA’s website on January 21, 2013.

• The Long Form Notice was posted on Class Counsel’s website, www.upfhlaw.ca, on January 18, 2013 and remained on the Firm’s website until May 30, 2014. Class Counsel for the Leclair Action posted the Long Form Notice on its website, www.cavalluzzo.com, on January 23, 2013.

12After the notice program, 1,439 claims were received; 1,191 were granted; 243 claims were rejected for failure to meet all criteria, including eight claims from individuals who delivered their applications after the claims deadline.

13The Settlement allowed Class Members to appeal the decision of the Claims Administrator. Six appeal requests were submitted. The appeals was unsuccessful. Five appellants were persons who had opted out of the class actions and, therefore, did not satisfy the criteria for a successful appeal. One appellant, Virginia Bennett, was a Class Members who submitted her claim form after the claims deadline and, therefore, did not satisfy the criteria for a successful appeal.

14On December 4, 2013, cheques were mailed to all eligible Class Members. One thousand two hundred and three cheques for a total of $5,906,345.41 were issued to 1,191 claimants. Some valid claimants requested split payments. NPT RicePoint paid taxes on the settlement funds in the amount of $99,834.67, and incurred bank service charges totaling $1,145.52. Each claimant received $5,533.71.

15As of June 11, 2015, $5,373.74 remains from the settlement funds.

16The Settlement Agreement expressly addressed the treatment of undistributed funds. The Agreement stated:

In the event that all monies from the Settlement Amount or Final Settlement Amount are not distributed as contemplated by the Approval Order, the Administrator, McSheffrey and Leclair may apply to the Ontario Superior Court of Justice for a further order as to distribution of any remaining monies, … and may propose any plan of further distribution which to them, either jointly or severally, seems reasonable and consistent with the original purpose of the Minutes of Settlement. ….

17From their late claims or from communications that they made to Class Counsel, eleven persons were identified as late claimants; namely: Virginia Bennett, Elizabeth Holdsworth, Margaret Marcotte, Anne Haq, Louise Walker, Anne Margrete, Mary Gail Moore, Mary Janet Noble, Marilyn Ferguson, Sudhakar Lagali, and Frank Hamaker for his late wife Rosemary.

18I directed that notice be given to this group of eleven Class Members.

19Five of the eleven, Mesdames Bennett, Holdsworth, Marcotte, Haq and Mr. Hamaker, attended at the hearing of the motion. I am satisfied that they were all Class Members who had explanations for why their claims were late. The explanations were largely associated with failed mail services by Canada Post.

20Another three of the eleven, Mesdames Walker, Noble, and Lagali wrote or emailed Class Counsel, but they did not attend the hearing. Having reviewed their correspondence, I am satisfied that Ms. Lagali is a Class Member who had an explanation for why her claim was late. Once again, the explanation is associated with failed mail services by Canada Post.

21The Representative Plaintiffs propose that the undistributed funds be donated cy-près to the Ontario Employment Education and Research Centre (“OEERC”), which is a registered charity.

22OEERC provides information services to educate workers about their rights at work and to assist them with resolving workplace problems. Working with its community partners, the OEERC supports a wide range of program initiatives, including a telephone hotline, free clinics, and one-on-one support to educate workers on their employment rights.

C. DISCUSSION AND ANALYSIS

C. DISCUSSION AND ANALYSIS

23As a general rule, cy-près distributions should not be approved where direct compensation to class members is practicable: Cassano v Toronto Dominion Bank (2009), 2009 CanLII 35732 (ON SC), 98 O.R. (3d) 543 (S.C.J.) at para. 17. In the immediate case, it is practicable to make a distribution to six Class Members; namely, Class Members Bennett, Holdsworth, Marcotte, Haq, Lagali, and the estate of Rosemary Hamaker.

24I, therefore, direct that $895.623 ($5,373.74/6) be distributed to Class Members Bennett, Holdsworth, Marcotte, Haq, Lagali, and the estate of Rosemary Hamaker.

25While not opposing this distribution, which the parties agreed was within the court’s authority to make, Class Counsel expressed the concern that the distribution might be unfair to other Class Members who might now make late claims.

26I see no unfairness. Class Members Bennett, Holdsworth, Marcotte, Haq, Lagali, and Hamaker have provided explanations that demonstrate that through no fault of their own, their claims were late, and they took the initiative to pursue their claims before I ordered that notice be given to them of this hearing.

27It was precisely because they had taken some initiative to pursue their claims that I ordered that they be given notice of this hearing about a final distribution. After they received notice of the hearing, they further followed up and presented sufficient material so that the court could determine whether their explanations and their claims were meritorious.

28It is fair for the court to help these Class Members who have helped themselves by their diligence, and by helping them the court better achieves the purposes of these class actions which is to provide access to justice to Class Members.

D. CONCLUSION

D. CONCLUSION

29Order accordingly.

Perell, J.