Heller v. Uber Technologies Inc.
COURT FILE NO.: CV-17-567946-00CP
DATE: 20220913
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
DAVID HELLER
Plaintiff
- and –
UBER TECHNOLOGIES INC., UBER CANADA INC., UBER B.V., RASIER OPERATIONS B.V. and UBER PORTIER B.V.
Defendants
Counsel:
Michael D. Wright, Youssef Kodsy, Lior Samfiru, Samara Belitzky, and Nora Parker for the Plaintiffs
Linda M. Plumpton, Sarah Whitmore, Alex Bogach, and Colette Koopman for the Defendants
Proceeding under the Class Proceedings Act, 1992
HEARD: September 13, 2022
PERELL, J.
FILE DIRECTION
[1] This is a case management conference file direction in this certified class proceeding under the Class Proceedings Act, 1992.[^1]
[2] David Heller and Felicia Garcia are the Representative Plaintiffs. Their action is against Uber Technologies Inc., Uber Canada Inc., Uber B.V., Rasier Operations B.V., and Uber Portier B.V. (collectively referred to as “Uber”). The Plaintiffs represent a class of persons who have entered into Service Agreements with Uber to use software applications developed and operated by Uber to provide rider transportation and food delivery services. The Plaintiffs submit that Uber has breached its employment contracts with the putative Class Members and contravened Ontario’s Employment Standards Act, 2000.[^2]
[3] The action was certified on August 12, 2021.[^3]
[4] In March 2022, there was an Omnibus Motion and cross-motion for the purposes of: (1) settling the terms of the Certification Order;[^4] (2) determining whether two questions, one proposed by the Plaintiffs and the other proposed by Uber, should be added to the list of common issues;[^5] and (3) to settle the Notice of Certification to be disseminated to the Class Members.[^6]
[5] I settled what was a trifling issue about the terms of the Certification Order.
[6] I granted Uber’s request to add a common question about the nature of the relationship between Uber and the Class Members.
[7] I refused the Plaintiffs’ request to add a common issue about the Arbitration and Class Action Waiver Clause that Uber added to its various contracts before the certification motion.
[8] Uber was relying on the Arbitration and Class Action Waiver Clause as a defence to the Plaintiffs’ Class, and the Plaintiffs wished to add a common issue to vitiate the clause. I refused the question, but I recommended that the Plaintiffs amend their Notice to the Class to in effect advise the class that this issue could be dealt with at individual issues trials. In my Reasons for Decision, I stated at paragraphs 27-38:
- The Plaintiffs seek to have the following question certified as a common issue:
Is the Class Action Waiver void because it: (a) is contrary to the Employment Standards Act; (b) contravenes the Class Proceedings Act; (c) is contrary to public policy; and/or (d) lacks consideration?
In my opinion, this question is not certifiable. It is not certifiable because it is not underpinned by any cause of action. The first criterion for certification is that the pleadings disclose a cause of action. The Plaintiffs’ Amended Fresh as Amended Statement of Claim does not disclose a cause of action with respect to the Class Action waiver.
The Plaintiffs’ Amended Fresh as Amended Statement of Claim, pleaded causes of action in: (a) negligence; and (b) unjust enrichment – which were not certified - and (c) that Uber breached its employment contracts with the putative Class Members and contravened Ontario’s Employment Standards Act, 2000, which causes of action were certified. The Plaintiffs’ Amended Fresh as Amended Statement of Claim makes no claim for relief with respect to the Class Action Waiver and there are no material facts pleaded to support allegations that the Class Action Waiver is void because it: (a) is contrary to the Employment Standards Act; (b) contravenes the Class Proceedings Act; (c) is contrary to public policy; and/or (d) lacks consideration.
On a certification motion, the court determines whether there is a cause of action, shared by an identifiable class, from which common issues arise that can be resolved in a fair, efficient and manageable way that will advance the proceeding and achieve the three objectives of class actions.[^7] In the immediate case, there is no cause of action with respect to the Class Action Waiver that has even been pleaded. Accordingly, the proposed common issue fails the cause of action criterion for certification.
There may be other reasons why the Plaintiffs’ proposed common issue is not certifiable. In this regard, I am unable to do a conventional cause of action analysis in the absence of a cause of action with its material facts having been pleaded.
I, thus, cannot say much about the parties’ respective arguments as to whether the Plaintiffs could have satisfied the cause of action criterion if they had pleaded the material facts for a cause of action.
All I can say at this juncture is that Uber has strong arguments based on the material facts pleaded in the Plaintiffs’ factum for this motion that the cause of action criterion has not been satisfied. Causes of action with respect to contract formation and with respect to setting aside contracts on the grounds of illegality do exist, but in the immediate case, they have not been pleaded, and it is far from clear how these causes of action could be applied to red pencil and extract the Class Action Waiver from a contract that the Plaintiffs otherwise wish to enforce as an employment contract.
Similarly at this juncture, all I can say without deciding the point is that Uber has quite strong arguments that it is plain and obvious that the Class Action Waiver is not void because: (a) it is not contrary to the Employment Standards Act; (b) it does not contravene the Class Proceedings Act and in any event the Class Proceedings Act, 1992 is a procedural statute and not the basis for substantive relief; (c) the Class Action Waiver is not contrary to public policy; and (d) the Class Action Waiver does not want for consideration.
Much the same thing may be said about the common issues, preferable procedure, and representative plaintiff criteria, where Uber has strong arguments that these criteria are not satisfied for the proposed question.
I therefore shall not certify the question proposed by the Plaintiffs about the Class Action Waiver. This means that the enforceability of the Class Action Waiver will not be determined at the common issues trial. However, as I noted in my certification motion decision, Class Members who did not opt out of the Class Action Waiver are still Class Members and may be able to negate the operation of the Class Action Waiver at individual issues trials if the class action gets that far.
I, therefore, recommend that Class Members be informed that if they did not opt out of the Arbitration and Class Action Waiver Clause, then should the court determine at the common issues trial that they are employees and should they wish to pursue claims for compensation from Uber at individual issues trials, then they will be met with a defence that they have waived the right to do so in accordance with the Arbitration and Class Action Waiver Clause. However, they should also be informed that the determination of the merits of that defence will be determined at individual issues trials because there may be a counterargument that the Arbitration and Class Action Waiver Clause is void and not enforceable.
I leave it to Class Counsel to take up this recommendation as they may be advised by seeking amendments to the Long and Short Notices of the Certification of this action.
[9] Thus, in March 2022, I settled the Notice and I directed that the Notice could include the Defendants’ additional common issue question but not the Plaintiffs’ proposed question. I directed that the approval of the Notice was without prejudice to a motion in writing to be brought within thirty days to amend the Short and Long Notices to inform Class Members of the Arbitration and Class Action Waiver clause and the Class Members’ counterargument to it. The Notices would advise Class Members that the determination of the merits of Uber’s defence would be determined at individual issues trials because there may be a counterargument that the Arbitration and Class Action Waiver Clause is void and not enforceable.
[10] The Plaintiffs sought leave to appeal my decision refusing to certify the proposed arbitration clause common issue, and the Defendants – not the Plaintiffs – adopted my recommendation and brought a motion in writing to amend the Short and Long Notices to inform Class Members about the Arbitration and Waiver Clause dispute.
[11] On May 2, 2022, there was a case conference and Uber requested an extension of time to bring the motion to amend the Notices. I granted that request, and I issued a File Direction extending the time for the motion until thirty days following either: (i) a decision of the Divisional Court denying the Plaintiffs’ motion for leave to appeal my decision in Heller v. Uber Technologies Inc., 2022 ONSC 1997; or (ii) if leave to appeal is granted, a decision on that appeal.
[12] On July 8, 2022, the Divisional Court denied leave to appeal.[^8]
[13] Uber brought on its motion to amend the Notices, but the Plaintiffs did not deliver any responding material. Instead, the Plaintiffs proposed to bring a motion to amend their Statement of Claim. On August 18, 2022, I received the following letter from Class Counsel:
We write in connection with the Defendants’ Motion to Amend the Class Action Notices in the above-noted matter, returnable in writing on August 22, 2022.
The Plaintiffs have written the Defendants to request a Case Conference between the parties and Your Honour to discuss potential motions by the Plaintiffs to amend the Amended Fresh as Amended Statement of Claim and to certify an additional common issue arising from that amendment. If the Plaintiffs are successful in these proposed motions, the Defendants’ Motion to amend the Class Action Notices will be moot.
Accordingly, the Plaintiffs are proposing that their two motions be heard together with the Defendants’ Motion to Amend the Class Action Notices. As a result of this request, the Plaintiffs do not intend to file materials in response to the Defendants’ motion materials at this time. The Plaintiffs will write Your Honour once we have conferred with the Defendants and determined whether the proposed motions of the Plaintiffs will be opposed or proceed on consent. Either way it is anticipated that the proposed Case Conference should be quite brief.
[14] On August 22, 2022, I received a letter from Uber’s Counsel in which the Defendants opposed proceeding as proposed by Class Counsel. The letter stated:
We write in response to the plaintiffs’ letter to Your Honour of August 18, 2022.
The defendants agree that a Case Conference would be of assistance and will work with the plaintiffs’ counsel on dates.
The defendants do not agree with the plaintiffs’ proposed course of action as outlined in their letter. Although no proposed pleading amendment has been provided to the defendants to date, the defendants are concerned that the plaintiffs’ proposal to further amend the Amended Fresh as Amended Statement of Claim and to again request certification of a proposed common issue dealing with the validity of the arbitration clause is prejudicial, an abuse of process and is barred by the doctrine of res judicata.
As Your Honour will recall, the statement of claim in this case has already undergone numerous amendments, including with respect to the arbitration clause. In addition, the sufficiency of the pleadings on the validity of the arbitration clause has been directly at issue since at least the return of the certification motion more than a year ago. Rather than pursuing a pleading amendment at that stage, after the release of Your Honour’s decision certifying this proceeding in August 2021, the plaintiffs elected instead to seek certification of a proposed common issue dealing with the validity of the arbitration clause. Having failed in that regard, the plaintiffs sought leave to appeal Your Honour’s decision refusing to certify the arbitration clause proposed common issue. The Divisional Court denied the plaintiffs’ motion for leave to appeal on July 8, 2022. Now on the deadline for the plaintiffs’ response to the defendants’ motion to Amend the Notices of Certification – a motion the plaintiffs agreed ought to proceed within 30 days of any denial of leave by the Divisional Court – the plaintiffs have failed to respond to the defendants’ motion and instead propose a renewed attempt to certify a proposed common issue dealing with the validity of the arbitration clause. The defendants do not consent to proceeding in this manner.
[15] The day before this case management conference, I received the following letter from Class Counsel:
[…] As you will recall, the Plaintiffs seek to schedule two motions: (i) a motion to amend the Amended Fresh as Amended Statement of Claim; and (ii) a motion to certify an additional common issue arising from that amendment. For Your Honour’s reference, the Plaintiffs have enclosed a draft of their statement of claim with the proposed amendments.
The proposed amendments are with respect to the Defendant’s August 26, 2020 amendments to the Class Members’ service agreements, which inserted a class action waiver and arbitration clause (the “Arbitration and Class Action Waiver Clause”). The Plaintiffs have carefully considered Your Honour’s Reasons for Decision dated March 31, 2022, on the motions to certify additional common issues. Taking Your Honour’s reasons into account, the Plaintiffs propose to amend their statement of claim by pleading causes of action that the Arbitration and Class Action Waiver Clause is void, pleading the material facts necessary to support the allegation that the Arbitration and Class Action Waiver Clause is void, and claiming relief with respect to the Arbitration and Class Action Waiver Clause. Following these amendments, the Plaintiffs seek to certify the following question as a common issue:
Are the August 26, 2020 Amendments to the Class Members’ service agreements, which inserted a class action waiver and arbitration clause, void as a matter of law because the amendments: (a) are contrary to the Employment Standards Act; (b) contravene the Class Proceedings Act; (c) are contrary to public policy; (d) lack consideration; and/or (e) do not apply retroactively?
The Defendants have brought a motion to amend the class action notices. Specifically, the Defendants seek to amend the class action notices to inform the Class Members that if they did not opt out of the Arbitration and Class Action Waiver Clause, then should the Court determine at the common issues trial that they are employees and should they wish to pursue claims for compensation from Uber at individual issues trials, then they will be met with a defence that they have waived the right to do so in accordance with the Arbitration and Class Action Waiver Clause.
If this Honourable Court grants the Plaintiffs their motion to amend the statement of claim and certify an additional common issue with respect to the Arbitration and Class Action Waiver Clause, then the Defendants’ motion to amend the notices of certification would become moot.
Accordingly, the Plaintiffs propose that all three motions be heard together. Such procedure would accord with the recent decision of Justice Morgan in Browne v. Horizons ETF Corp., 2022 ONSC 3441, wherein Justice Morgan scheduled a motion to amend a statement of claim to be heard together with a motion to certify an additional common issue as a result of that amendment. […]
[16] This is the background to this case management conference.
[17] At the case management conference, Uber agreed that if the Plaintiffs’ motions were successful, then Uber’s motion was moot and the Plaintiffs agreed that if their motions were unsuccessful or if I did not allow these motions to be scheduled and heard, then Uber’s motion was unopposed.
[18] Section 12 of the Class Proceedings Act, 1992 states:
- The court, on its own initiative or on the motion of a party or class member, may make any order it considers appropriate respecting the conduct of a proceeding under this Act to ensure its fair and expeditious determination and, for the purpose, may impose such terms on the parties as it considers appropriate.
[19] Pursuant to my authority under s. 12 of the Act, I have the authority to refuse to hear the Plaintiffs’ two motions, and I could exercise that authority, if I decided that the Plaintiffs’ two motions would not ensure the fair and expeditious determination of the action.
[20] Thus, in the circumstances of this certified class case, I considered not scheduling the motions because there is a strong argument that scheduling these motions would delay this class action and hearing the motions would not ensure its fair and expeditious determination because it is arguable that the matter of the enforceability of the Arbitration and Class Action Waiver clause will adequately and fairly be dealt with as an individual issue.
[21] However, having reflected on the matter, I have decided that the better course is to allow the Plaintiffs’ two motions to be heard along with the Defendants’ motion. (The fate of the Defendants’ motion is predetermined because the parties agree that its fate is tied to the outcome of the Plaintiffs’ motions.)
[22] In anticipation of this possible outcome of allowing the motions to proceed, at the case management conference, I canvased the parties about a timetable for the three motions. The following timetable was agreed upon. I now direct that this timetable be followed.
Delivery of Plaintiffs’ Material By October 14, 2022
Delivery of Defendants’ Material By November 11, 2022
Delivery of Plaintiffs’ Reply Material, if any By November 25, 2022
Cross-examinations, if any By December 31, 2022
Plaintiffs’ Factum By January 13, 2023
Defendants’ Factum By February 3, 2023
Plaintiffs’ Reply Factum By February 13, 2023
Hearing Date March 7, 2023
The parties shall deliver their materials in accordance with the Rules of Civil Procedure and on Ontariocourts.caselines.com
The parties may on consent vary the timetable except for the hearing date.
[23] Order accordingly.
Perell, J.
Released: September 13, 2022.
COURT FILE NO.: CV-17-567946-00CP
DATE: 20220913
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
DAVID HELLER
Plaintiff
- and –
UBER TECHNOLOGIES INC., UBER CANADA INC., UBER B.V., RASIER OPERATIONS B.V. and UBER PORTIER B.V.
Defendants
FILE DIRECTION
PERELL J.
Released: September 13, 2022
[^1]: S.O. 1992, c. 6. [^2]: S.O. 2000, c. 41. [^3]: Heller v. Uber Technologies Inc, 2021 ONSC 5518. [^4]: Heller v. Uber Technologies Inc., 2022 ONSC 1996. [^5]: Heller v. Uber Technologies Inc., 2022 ONSC 1997. [^6]: Heller v. Uber Technologies Inc., 2022 ONSC 1998. [^7]: Sauer v. Canada (Attorney General), 2008 43774 (ON SC), 2008 CarswellOnt 5081 (SCJ) at para. 14, leave to appeal refused 2009 2924 (ON SCDC), [2009] OJ No 402 (Div Ct); Bryson v. Canada (Attorney General), 2009 NBQB 175 at para. 22; Brooks v. Canada (Attorney General), 2009 SKQB 509 at para. 75, leave to appeal refused 2010 SKCA 55. [^8]: Heller v. Uber Technologies Inc., 2022 ONSC 3949