COURT FILE NO.: CV-17-00569023-00CP
DATE: 2020/06/24
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Ashleka Persaud and Ten Eight Vacations Ltd.
Plaintiffs
– and –
Talon International Inc.
Defendant
Sean A. Brown, Paul Mack, and Candace Mak for the Plaintiffs
Nancy J. Tourgis and Symon Zucker for the Defendant
Pursuant to the Class Proceedings Act, 1992
HEARD: June 15, 2020
PERELL, J.
REASONS FOR DECISION
[1] In this action under the Class Proceedings Act, 1992,[^1] this is a motion: (a) to revise a Certification Order; (b) for approval of the Notice of Certification to the Class Members; and (c) for a determination of the costs of the certification motion.
[2] As I shall explain below, it is neither necessary nor appropriate to revise the Certification Order and, therefore, I shall not revise it. I do, however, approve a somewhat modified Notice of Certification, which more often than not is authorized by an Order separate from the Certification Order. As for the costs for the certification motion, that should be determined in the regular manner, which is that the successful party, in this case, the Plaintiffs Ashleka Persaud and Ten Eight Vacations Ltd. make their costs submissions in writing, which I direct them to do within twenty days of the release of these Reasons for Decision followed by the Defendant Talon International Inc.’s submissions within a further twenty days.
[3] The factual and procedural background to this motion is somewhat peculiar and for present purposes it begins with Ashleka Persaud and Ten Eight Vacations Ltd. having been granted a conditional Certification Order in September 2018.[^2]
[4] The precondition for certification was that Ashleka Persaud and Ten Eight Vacations Ltd. replace their then current Class Counsel, Levine, Sherkin, Boussidan P.C. (“Levine Sherkin”) I had disqualified Levine Sherkin from being Class Counsel because the law firm was also acting for a group of approximately twenty individuals who would opt out of the class action to pursue individual claims against Talon. This is explained in my Reasons for Decision on the certification motion and needs no further comment for present purposes.
[5] What is important for present purposes to note is that in order for the Plaintiffs to have an unconditionally certified class action, they had the problem of finding a replacement for Levine Sherkin as their lawyers. And, the replacement lawyers also had to be approved by the Court in order to become Class Counsel.
[6] In the fall of 2018, with the assistance of Levine Sherkin the Plaintiffs sought to retain new lawyers. However, this proved to be difficult because acting as a Class Counsel imposes financial risks and the potential candidates for the job wanted more information about the nature of the Class Members’ claims and in particular the candidate lawyers needed a better understanding of class size. Getting this information, which depended on the cooperation of Talon, was not easy and time was tight.
[7] While efforts were being made to find a replacement lawyer, in November 2018, the conditional Certification Order was taken out and issued and entered. The form and content of the Certification Order were agreed to by Levine Sherkin and Talon’s Counsel. This was properly done and although Levine Sherkin were disqualified as counsel going forward, the firm had been counsel at the certification motion and the law firm acted properly in taking out the Certification Order.
[8] The Conditional Order did not address the following matters: (a) the existence of a subclass of purchasers who signed releases after October 13, 2016; (b) common issues for the subclass; (c) the manner in which notice of certification and the right to opt out is to be provided to the class, including the content of the Long Form Notice; and (d) costs of the contested certification motion.
[9] As foreshadowed above and partially explained above, although the Plaintiffs’ subsequently-appointed new lawyers complain about these omitted matters, they were properly omitted and there is no mistake that was made in the form and content of the Certification Order that was taken.
[10] Although I did mention and discuss a subclass in my Reasons for Decision, it is premature to consider defining a subclass and common issues for a subclass until Talon has delivered its Statement of Defence, which it has yet to do.
[11] Returning to the factual and procedural background, on April 10, 2019, the Plaintiffs retained Paul Mack to be their lawyer of record. Upon being retained, Mr. Mack was unaware that a Conditional Certification Order had been issued and entered.
[12] In late September 2019, the Plaintiffs retained Sean Brown and Candace Mak to act as co-counsel with Mr. Mack. Co-Counsel were also not aware that a Conditional Certification Order had already been issued and entered.
[13] In November 2019, unaware of the already taken out Certification Order, Mr. Brown prepared a draft Certification Order, which he sent to counsel for Talon. On December 4, 2019, Talon’s counsel advised Ms. Mak, Mr. Brown, and Mr. Mack about the already entered Order.
[14] Mr. Mack, Ms. Mak, and Mr. Brown reviewed the existing Certification Order, compared it to their own draft Order, and were unhappy with the Certification Order.
[15] Pausing here, it needs to be recalled that although Mr. Mack, Ms. Mak, and Mr. Brown had been retained by the Plaintiffs, at this time, they had not been approved to be Class Counsel.
[16] In April 2019, the Plaintiffs, represented by what might be called potential Class Counsel or motion counsel, brought a motion for information from Talon. The main purpose of the motion was to obtain information so that Ms. Mak, Mr. Brown, and Mr. Mack could evaluate whether they would assume the risks and the rewards of actually becoming Class Counsel. The motion was successful,[^3] but it took some time for the information they were seeking to be provided and evaluated.
[17] To move the action forward, a case management conference was scheduled and heard on April 17, 2020. At the case conference, Talon consented or did not oppose the appointment of Flaherty McCarthy LLP and Mack Lawyers as Class Counsel. I appointed them Class Counsel, and the action finally became unconditionally certified as a class action.[^4] This circumstance calls for no change to the already existing Certification Order.
[18] At the case conference, Class Counsel raised their concerns about the Certification Order which they felt needed to be revised. I indicated that absent the consent of the parties, changes to the Certification Order would require a formal motion. I, therefore, scheduled June 15, 2020 for a motion or case conference to resolve: (1) changes, if any, to the Certification Order; (2) the Notice of Certification to Class Members; and (3) a schedule for next steps in this action.
[19] Save with respect to agreeing that costs should be dealt with in the routine way, the parties were unable to agree about these matters. Talon took the position, with which I agree, that there was no mistake or need to amend the Certification Order.
[20] Class Counsel’s most fervent argument was that a subclass needed to be demarcated so that the subclass Members would not believe they had been excluded when they received the Notice of Certification. Upon analysis, however, this argument is not sound because the subclass is clearly a part of the class and it would just make for confusion to develop language to attempt to explain that a potential Subclass Member has not been excluded from being a Class Member.
[21] Thus, for the purposes of the motion that is now before the Court, all that is required is to grant the motion insofar as the Plaintiffs seek court approval for the Notice of Certification and ancillary relief but to otherwise dismiss the Plaintiffs’ motion, which I do with costs in the cause.
[22] I have reviewed the Plaintiffs’ draft Order submitted for the purposes of this motion and made revisions.
[23] For the above reasons, I, therefore, make an Order in the form of the Order set out in Schedule “A” to these Reasons for Decision.
[24] In the circumstances of the Covid-19 emergency, these Reasons for Decision are deemed to be an Order of the court that is operative and enforceable without any need for a signed or entered, formal, typed order.
[25] The parties may and should submit formal orders for signing and entry once the court re-opens; however, these Reasons for Decision are an effective and binding Order from the time of release.
Perell, J.
Released: June 24, 2020
Schedule “A”
Court File No.: CV-17-569023-00CP
ONTARIO
SUPERIOR COURT OF JUSTICE
THE HONOURABLE MR. JUSTICE PERELL
*, THE * DAY OF * 2018
B E T W E E N:
ASHLEKA PERSAUD and TEN EIGHT VACATIONS LTD.
Plaintiffs
- and -
TALON INTERNATIONAL INC.
Defendant
Proceeding under the Class Proceedings Act, 1992, S.O. 1992, c. 6, as amended
ORDER
THIS MOTION made by the Plaintiffs for an Order amending the Certification Order dated September 13, 2018 and for approval of the Notice of Certification was heard this day at the Superior Court of Justice by video conference hearing.
ON HEARING the submissions of counsel for the Plaintiffs and counsel for the Defendant,
AND ON READING the materials filed by counsel for the Plaintiffs and counsel for the Defendant:
THIS COURT ORDERS that the motion to amend the Certification Order is dismissed.
THIS COURT AUTHORIZES Class Counsel, as it may be advised and at its own expense, to retain Ricepoint to act as the Litigation Administrator for the purpose of administering the Notice of Certification.
THIS COURT ORDERS that the Notice of Certification set out in Schedule “A” is approved.
THIS COURT ORDERS that the Opt-Out Deadline is 75 days after notice is provided in accordance with the Notice Plan attached as Schedule “B”.
THIS COURT ORDERS that a Class Member may opt out of this action by completing the Opt-Out Notice and delivered the Notice by regular lettermail or prepaid courier, by the Opt-out Deadline to Class Counsel (or Ricepoint if it is retained as Litigation Administrator.)
THIS COURT ORDERS that the Opt-out Notice is valid only if it contains the following information:
a. The name of this proceeding (Persaud v. Talon International Inc.), or similar identifying words);
b. The Class Members full name, email address, if any, mailing address, and telephone number, if any;
c. The Hotel Unit number the Class Member intended to purchase; and
d. The Class Member’s signature or the signature of his or her legal agent.
- THIS COURT ORDERS that any Class Member who has not validly opted-out of this action will be bound by any determinations made by the Court in this action.
Justice P. Perell
SCHEDULE “A”
NOTICE OF CERTIFICATION AS A CLASS PROCEEDING
Persaud v. Talon International Inc., Court File No.: CV-17-569023-00CP
THIS NOTICE MAY AFFECT YOUR RIGHTS. PLEASE READ IT CAREFULLY.
NOTICE TO:
All purchasers except “Excluded Purchasers”, defined below, of hotel condominium units (the “Hotel Units”) in the hotel portion (the “Trump Hotel”) of the Trump International Hotel and Tower Toronto (the “Trump Tower”) who:
e. signed or who had signed on their behalf agreements of purchase and sale with the developer, the Defendant (“Talon”);
f. paid or who had paid on their behalf deposits or portions of deposits to Talon; the developer of the Trump Tower, the Defendant (“Talon”), and
g. did not complete their transactions with Talon.
“Excluded Purchasers” are:
a. purchasers against whom Talon has obtained a judgment forfeiting their deposit(s); and
b. purchasers who have obtained a judgment against Talon for repayment of their deposit(s).
1. What is this lawsuit about?
The representative Plaintiff, Ashleka Persaud, has commenced a Class Proceeding against Talon International Inc. to rescind (set aside) an agreement to purchase a Hotel Unit in a mixed-use condominium project in downtown Toronto formerly known as the Trump International Hotel and Tower Toronto. The Class Members sue for a refund of the deposits they paid, together with interest pursuant to s. 82 of the Condominium Act.
The Class Proceeding was certified by the Court on September 13, 2018. A copy of the Certification Order and Reasons can be found at www.TalonClassAction.com.
Flaherty McCarthy LLP and Mack Lawyers (“Class Counsel”) have been appointed to represent the class in the Class Proceedings.
2. What is the purpose of this notice?
The purpose of this notice is to inform the Class Members that the Class Proceeding has been certified and about the Class Members’ rights to remain in the action or to opt-out of the action.
3. Am I a member of the class?
You are a member of the class (“Class Member”) and entitled to participate in the Class Proceedings if you meet the following definition:
All purchasers except “Excluded Purchasers”, defined below, of hotel condominium units (the “Hotel Units”) in the hotel portion (the “Trump Hotel”) of the Trump International Hotel and Tower Toronto (the “Trump Tower”) who:
(a) signed or who had signed on their behalf agreements of purchase and sale with the developer, the Defendant (“Talon”);
(b) paid or who had paid on their behalf deposits or portions of deposits to Talon; the developer of the Trump Tower, the Defendant (“Talon”), and
(c) did not complete their transactions with Talon.
“Excluded Purchasers” are:
(a) purchasers against whom Talon has obtained a judgment forfeiting their deposit(s); and
(b) purchasers who have obtained a judgment against Talon for repayment of their deposit(s).
4. How does this Class Proceeding affect Class Members?
If you are a Class Member, and you wish to participate in the proceeding, then you do not need to do anything more at this stage. You are automatically included in the Class.
There is no cost to you to participate in the class proceeding. You will have no responsibility to pay any legal fees. Class Counsel will be paid only in the event that the action succeeds at trial or there is a settlement. Class Counsel have entered into a contingency fee agreement with the Representative Plaintiffs. The agreement provides for a contingency fee of 33.3% of the amount recovered in the Class Proceeding to be paid to Class Counsel, along with reimbursement of all disbursements and taxes. The court must first approve Class Counsel’s legal fees before they will be paid.
A Class member who does not opt out of the Class Proceeding will be bound by the terms of any judgment or any settlement approved by the Court. Each Class member may be entitled to share in the amount of any judgment awarded or settlement reached in the Class Proceeding.
A judgment (including an approved settlement), whether favourable or not, will bind all Class Members who do not opt out of the Class.
A judgment (including an approved settlement), whether favourable or not, will bind all Class Members who do not opt out of the class. If a person who is Class Member wants to sue or continue to sue the defendant based on claims this proceeding will resolve, he or she must take steps to opt out of the class. If a person opts out of the Class Proceeding, he or she will not be eligible to recover any benefits under a Settlement or award in the Class Proceeding.
5. Class Members May Opt Out of the Proceeding
IF YOU ARE A CLASS MEMBER AND DO NOT WANT TO PARTICIPATE in this Class Proceeding and/or you want to sue the Defendant based on claims this proceeding will resolve, you must take steps to opt out If you opt out of the Class, you will not be eligible to recover any benefits under a settlement or award in this Class Proceeding.
Members of the Class may exercise their right to opt out of the Class by submitting a letter by regular lettermail or prepaid courier stating that you wish to opt out of the Settlement. Your “Opt-Out Form” must include:
The name of this proceeding (Persaud v. Talon International Inc.), or similar identifying words);
Your full name, email address, if any, mailing address, and telephone number, if any;
The Hotel Unit number you intended to purchase; and
Your signature or the signature of your legal agent, acting with your instructions; and
No person may opt out a minor or mentally incapable member of the class without permission of the court after notice to the Children’s Lawyer and/or the Public Guardian and Trustee, as appropriate.
An Opt-Out Form can be obtained by visiting the Class Proceeding website (www.TalonClassAction.com). This form must be printed out and delivered by regular mail or prepaid courier.
Your Opt-Out Form must be postmarked for regular mail or submitted to courier for delivery to the address below, by no later than XXXXXX, 2020:
LITIGATION ADMINISTRATOR INFO - TBD
You cannot exclude yourself by telephone or email. You cannot exclude yourself by mailing a notification to any other location or if your Opt-Out Form is post marked or submitted to courier after the deadline of XXXXXXX, 2020.
No Class Member will be permitted to opt out after XXXXXXXX, 2020.
6. Additional Information
Any questions about the matters in this notice should be addressed to Class Counsel.
The certification order and other information regarding the Class Proceeding is available on the Class Proceeding website (www.TalonClassAction.com).
Requests for further information or questions for Class Counsel should be directed to:
SEAN A. BROWN
FLAHERTY MCCARTHY LLP
Toronto-Dominion Centre
95 Wellington Street West
10th Floor, Suite 1000
Toronto, Ontario
M5J 2N7
SCHEDULE “B”
NOTICE PLAN
Class Counsel is mindful of the fact that Notice of Certification cannot be provided to the class members in the traditional manner, due to their geographic disparity. They are purchasers from all over the world. Fortunately, we have information about class members from the Agreements of Purchase and Sale and other documents provided by the defendant in its Affidavit of Documents (“the defendant’s documents”).
Class Counsel shall send the Long Form Notice to class members, by regular lettermail, to the address of addresses for each class member based on information in the defendant’s documents, including letters to the lawyer representing the class members when they entered into the Agreement of Purchase and Sale as identified in the defendant’s documents.
Class Counsel shall post the Long Form notice at the website created by Class Counsel under the domain www.TalonClassAction.com (“the class proceeding website”).
Class Counsel shall create a Facebook Page identified as a page created for the purpose of providing notice to class members, and shall post the Long Form Notice on the Facebook page (“the Facebook page”).
Class Counsel shall employ industry standard Search Engine Optimization (SEO) to direct web search traffic to the class proceeding website and the Facebook page.
Upon expiry of the notice and opt-out period, Class Counsel shall report to the court with respect to the steps taken in furtherance of providing notice in accordance with this Notice Plan, and shall report with respect to all opt-outs received.
Class Counsel is confident that providing notice in the manner described above is the most cost-effective method of providing notice to the greatest number of class members in the Greater Toronto area, Canada and throughout the world.
COURT FILE NO.: CV-17-00569023-00CP
DATE: 2020/06/24
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Ashleka Persaud and Ten Eight Vacations Ltd.
Plaintiffs
– and –
Talon International Inc.
Defendant
REASONS FOR DECISION
PERELL J.
Released: June 24, 2020
[^1]: S.O. 1992, c. 6. [^2]: Persaud. v. Talon International Inc. 2019 ONSC 2488. [^3]: Persaud. v. Talon International Inc., 2019 ONSC 2488. [^4]: Persaud v. Talon International Inc., 2020 ONSC 2362.