Court File and Parties
COURT FILE NO.: CV-10-414774-00CP DATE: 20230810 ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN: GIOVANNI SPINA, JOHN SPINA DRUGS LTD., ROMEO VANDENBURG and ROMEO VANDENBURG DRUG COMPANY LTD. Plaintiffs
- and - SHOPPERS DRUG MART INC. and SHOPPERS DRUG MART (LONDON) LTD. Defendants Proceeding under the Class Proceedings Act, 1992
Counsel: Odette Soriano and Paul Davis, for the Plaintiffs Mark A. Gelowitz, Geoff Hunnisett, and Malcolm Aboud, for the Defendants
HEARD: August 3, 2023
PERELL, J.
Reasons for Decision
[1]
Overview
The issue to be decided on this motion is whether after summary judgments in an action under the Class Proceedings Act, 1992, the class members should be given official notice of the result of the summary judgment motion or whether giving notice should be postponed because appeals are pending.
2In this certified class action under the Class Proceedings Act, 1992, which began in 2010, the plaintiffs (Giovanni (John) Spina, John Spina Drugs Ltd., Romeo Vandenburg, and Romeo Vandenburg Drug Company Ltd.) sue Shoppers Drug Mart Inc. and Shoppers Drug Mart (London) Ltd.
3After over a decade of litigation, both parties moved for summary judgments of the common issues. The plaintiffs’ and the defendants’ motions were granted in part and dismissed in part. See Spina v. Shoppers Drug Mart Inc., 2023 ONSC 1086.
4At the summary judgment motions, most of the class members’ claims were dismissed save for two claims, one of which was potentially successful as an individual issue but not as a common issue and one of which was granted only in part.
5The successful claim was the Distribution Centre Claim, where the class members were granted individual issues trials pursuant to s. 25 of the Class Proceedings Act, 1992.
6The partially successful claim was the Professional Allowances Claim of the class members who carried on business in Ontario who after a successful common issues judgment were granted individual issues trials to recover Professional Allowance payments. The entitlement to the Professional Allowance was a successful common issue.
7The Professional Allowance Claim was only partially successful because the purpose of the individual issues trials was to quantify the damages from the defendants’ breach of the 2002 Associate Agreement, but the common issue claim with respect to the 2010 Associate Agreement was dismissed.
8The plaintiffs have appealed the decision dismissing the claim with respect to the 2010 Associate Agreement. The defendants have cross-appealed the decision granting the claim with respect to the 2002 Associate Agreement.
9The plaintiffs wish to give official notice of the outcome of the common issues summary judgment motions. They bring a motion for the following relief:
An order: (a) approving notice to the class, substantially in the form attached as Schedule A [to the notice of motion], to be delivered by mail and/or email to each class member at their last known address; (b) appointing Epiq Class Action Services Canada Inc. (“Epiq”) to deliver the notice and authorizing class counsel to share contact information of class members with Epiq to facilitate provision of the notice; (c) requiring the defendants to provide class counsel with the last known email and mailing address of each class member; (d) requiring the defendants to advise class counsel whether each member of the Professional Allowance Class signed the 2002 Associate Agreement, the 2010 Associate Agreement, or both versions of the Associate Agreement; and (e) requiring the defendants to reimburse the plaintiffs for one half of the reasonable expenses associated with provision of the notice;
Costs of this motion; and
Such further and other relief as counsel may advise and this Court considers just.
10The defendants’ major objection is that giving notice will confuse the class members given that the outcome of the plaintiffs’ appeal and the defendants’ cross-appeal may dramatically change the outcome of the summary judgment motions.
11The defendants have no major objection to the content of the notice as drafted by the plaintiffs and they do not object to Epiq being appointed notice administrator. However, the defendants do object: (a) to paying half of the costs of the expense of giving notice, estimated to be $15,000 each; and (b) to the request that they provide class counsel with the last known mailing address of each class member and information about whether the class member signed the 2002 Associate Agreement, the 2010 Associate Agreement or both agreements.
12For the reasons that follow, there is no merit to the defendants’ objections, and I grant the plaintiffs’ motion as requested.
[13]
The Statutory Framework
The plaintiffs’ motion is brought pursuant to s. 19 of the Class Proceedings Act, 1992, but for present purposes the relevant provisions of the Act are sections 17, 18, 19, 20, 21, and 22 which state:
Notice of certification
17 (1) Notice of certification of a class proceeding shall be given by the representative party to the class members in accordance with this section.
Court may dispense with notice
(2) The court may dispense with notice if, having regard to the factors set out in subsection (3), the court considers it appropriate to do so.
Order respecting notice
(3) The court shall make an order setting out when and by what means notice shall be given under this section and in so doing shall have regard to,
(a) the cost of giving notice; (b) the nature of the relief sought; (c) the size of the individual claims of the class members; (d) the number of class members; (e) the places of residence of class members; and (f) any other relevant matter.
Means of giving notice
(4) The court may, for the purposes of subsection (3), order that notice be given by any of the following means or combination of the following means, and may order that notice be given to different class members by different means:
- Personally or by mail.
- By posting, advertising, publishing or leafleting.
- By individual notice to a sample group within the class.
- By any electronic means the court considers appropriate.
- By any means that may be prescribed.
- By any other means the court considers appropriate.
Contents of notice
(5) Unless the court orders otherwise, notice under this section shall,
(a) describe the proceeding, including the names and addresses of the representative parties and the relief sought; (b) state the manner by which and time within which class members may opt out of the proceeding; (c) describe the possible financial consequences of the proceeding to class members; (d) summarize any agreements between representative parties and their solicitors respecting fees and disbursements; (e) indicate whether there is a third-party funding agreement as defined in section 33.1 between the representative plaintiff and a funder and, if so, provide a description of the payment to which the funder is entitled under the agreement; (f) describe any counterclaim being asserted by or against the class, including the relief sought in the counterclaim; (g) state that the judgment, whether favourable or not, will bind all class members who do not opt out of the proceeding; (h) describe the right of any class member to participate in the proceeding; (i) provide contact information for a person or entity to whom class members may direct inquiries about the proceeding; (j) include the prescribed information; and (k) include any other information the court considers appropriate.
Court to consider circumstances
(6) The court shall make such orders under subsections (3), (4) and (5) as are necessary to ensure that the notice given is the best notice that is practicable in the circumstances.
Solicitations of contributions
(7) With leave of the court, notice under this section may include a solicitation of contributions from class members to assist in paying solicitor’s fees and disbursements.
Public Guardian and Trustee
(8) Notice ordered to be given under this section shall be served on the Public Guardian and Trustee if there is a reasonable possibility that the Public Guardian and Trustee is authorized to act on behalf of one or more class members.
Notice where individual participation is required
18 (1) When the court determines common issues in favour of a class and considers that the participation of individual class members is required to determine individual issues, the representative party shall give notice to those members in accordance with this section.
Order respecting notice
(2) The court shall make an order setting out when and by what means notice shall be given under this section, and in so doing shall have regard to the factors set out in subsection 17 (3).
Means of giving notice
(3) The court may, for the purposes of subsection (2), order that notice be given by any of the following means or combination of the following means, and may order that notice be given to different class members by different means:
- By any means referred to in paragraphs 1 to 4 of subsection 17 (4).
- By any means that may be prescribed.
- By any other means the court considers appropriate.
Contents of notice
(4) Unless the court orders otherwise, notice under this section shall,
(a) state that common issues have been determined in favour of the class; (b) state that class members may be entitled to individual relief; (c) describe the steps to be taken to establish an individual claim; (d) state that failure on the part of a class member to take those steps will result in the member not being entitled to assert an individual claim except with leave of the court; (e) provide contact information for a person or entity to whom class members may direct inquiries about the proceeding; (f) include the prescribed information; and (g) include any other information the court considers appropriate.
Court to consider circumstances
(5) The court shall make such orders under subsections (2), (3) and (4) as are necessary to ensure that the notice given is the best notice that is practicable in the circumstances.
Notice to protect interests of affected persons
19 (1) At any time in a proceeding under this Act, the court may order any party to give such notice as it considers necessary to protect the interests of any class member or party, or to ensure the fair conduct of the proceeding.
Order respecting notice
(2) The court shall make an order setting out when and by what means notice shall be given under this section, and in so doing shall have regard to the factors set out in subsection 17 (3).
Means of giving notice
(3) The court may, for the purposes of subsection (2), order that notice be given by any of the following means or combination of the following means, and may order that notice be given to different class members by different means:
- By any means referred to in paragraphs 1 to 4 of subsection 17 (4).
- By any means that may be prescribed.
- By any other means the court considers appropriate.
Court to consider circumstances
(4) The court shall make such orders under subsections (2) and (3) as are necessary to ensure that the notice given is the best notice that is practicable in the circumstances.
Notices, general requirements
Plain language
20 (1) A notice under section 17, 18 or 19 shall be written in a plain language manner.
Bilingual
(2) A notice under section 17, 18 or 19 shall be written in English and in French, unless the court orders otherwise.
Court approval
(3) A notice under section 17, 18 or 19 shall be approved by the court before it is given.
Delivery of notice
21 The court may order a party to deliver, by whatever means are available to the party, the notice required to be given by another party under section 17, 18 or 19, where that is more practical.
Costs of notice
22 (1) The court may make any order it considers appropriate as to the costs of any notice under section 17, 18 or 19, including an order apportioning costs among parties.
Exception, costs of notice of certification
(1.1) Despite subsection (1), the costs of any notice under section 17 may be awarded to the representative plaintiff only in the event of success in the class proceeding, except to the extent the defendant consents to their payment in whole or in part at an earlier time, and, for greater certainty, shall not be ordered to be paid by the defendant at any earlier time in the proceeding absent the defendant’s consent.
Idem
(2) In making an order under subsection (1), the court may have regard to the different interests of a subclass.
[14]
Analysis
Subsection 19(1) of the Class Proceedings Act, 1992 authorizes the court to order any party to give such notice as it considers necessary (a) to protect the interests of any class member or party or (b) to ensure the fair conduct of the proceeding.
15The court’s authority under s. 19(1) is discretionary because of the diverse nature of class actions and because class members’ needs vary across a broad spectrum of situations; thus, whether notice should be given requires a case-specific analysis to evaluate the benefits of the notice proposed, including its form and content, in the context of the circumstances of the particular case. See Haikola v. The Personal Insurance Company, 2019 ONSC 5982; Fantl v. ivari, 2018 ONSC 4443; Winkler et al., The Law of Class Actions in Canada (Toronto: Thomson Reuters, 2014) at p. 200.
[16]
The Purposes of Notice
The purposes of notice vary during the course of a class proceeding, which, generally speaking, has four phases; namely: (a) pre-certification; (b) certification; (c) common issues trial or settlement; and (d) individual issues trials.
17Pre-certification notices may concern how the proposed class action can co-exist with an ongoing relationship between the putative class members and the defendant such as franchisee/franchisor, employee/employer, landlord/tenant, etc.
18Certification notices are about the recruitment of class members and the exercise of their right to opt out.
19In Griffin v. Dell Canada Inc., 2010 ONSC 2560, Justice Strathy, as he then was, postponed the delivery of a notice of certification while appeals were pending because if the certification order was set aside, or varied, the costs of publication would have been incurred unnecessarily and members of the class would be confused. I agree with Justice Strathy’s discretionary decision, and I agree that it is confusing to be informed about opting out of a class proceeding whose certification may be reversed.
20Post-certification notices tend to be about the due process of the class proceeding up to the common issues trial or about class members’ views about any settlement.
21Settlement notices provide class members with an opportunity to oppose or support a settlement and provide information about how to participate in the settlement should it be approved by the court.
22While some action by class members is required after receiving notice of certification or notice of a settlement, no action is required of the class members receiving notice of the outcome of the common issues trials. As I shall explain further below, there is no confusion about waiting to see if a judgment at the common issues trial will withstand appellate review, and there is nothing wasteful in giving the notice now.
23The importance of the notice varies depending on the nature of the particular class action. In many class actions, notice of certification is not particularly significant from an operative point of view because most putative class members have little reason to opt out unless they have very substantial claims and even then, opt-outs are rare because class members are not exposed to legal expenses or to adverse costs awards save perhaps when the class action gets to individual issues trials.
24For what it is worth, my personal view is that the notice of a settlement is the most important of the various notices under the Class Proceedings Act, 1992 because: (a) the court is greatly assisted by hearing the class members’ opinion of the settlement; and (b) assuming the settlement is approved, the notice is the primary means of encouraging the class members to take up the settlement and to achieve the access to substantive justice purposes of the Class Proceedings Act, 1992.
25The purposes of the notice are also affected by the nature of the relationship between the class members and class counsel. That relationship changes during the course of the class action. Pre-certification, there is a quasi-lawyer-and-client relationship. Post certification, it is a lawyer-client relationship, unless the putative class member opts out. The nature of relationship may change again at individual issues trials where a class member might change his or her lawyer, although this is highly unlikely although theoretically possible. These relationships influence the nature and purpose of the various notices given during the course of the class action.
26Insofar as the defendant is concerned, as noted above, the purpose of notice to the class members also varies depending on whether there is an ongoing relationship with the class members.
[27]
Application to the Present Case
Turning to the immediate case, there is no reason to give notice to ensure the fair conduct of the remaining appellate proceedings, which are being case managed by Justice Thorburn of the Court of Appeal. The proposed notice is not about the conduct of the proceedings. It is a report about past events.
28In the immediate case, there is no reason to give notice because of the ongoing relationship between the class members and the defendants. That relationship has co-existed with the class action for well over a decade.
29In the immediate case, the purpose of a notice under s. 19(1) of the Class Proceedings Act is just to protect the interests of any class member.
30In the immediate case, since it is only the interests of the class members that are engaged, one has to take with a grain of salt the defendants’ concern that the class members will be confused by being informed about the outcome of the common issues trials, which may be overturned by the appeal and cross-appeal. Given that it is a fiduciary responsibility of class counsel to provide reports and legal advice to the class members about the litigation, one can be skeptical about the defendants’ concerns about class members being confused.
31Put bluntly, there is nothing that affects the interests of the defendants in the proposed notice, and it is not their business to interfere with reporting obligations of class counsel. Moreover, I rather doubt that the class members will be confused by the pending appeals. Like most appeals, the outcome of the appeals in the immediate case will be that the Ontario class members will get more, less, none, or the same amount of Professional Allowances.
32I see no merit in giving notice after the appeals. The class members, who are the clients of class counsel, are entitled throughout the litigation to have class counsel’s official report of its contingent fee services to the class members. In the immediate case, the notice is about what happened at the common issues trial. Giving that notice after the appeals actually would be confusing.
33Moreover, the class members are entitled to have the information about what happened at the common issues trials in order to communicate their views, if any, to the plaintiffs and class counsel about the appeals.
34It is not inconceivable that the appeals may settle and that the class members will have to be consulted about the settlement. If the appeals are favourable to the class members, then they should be placed in a position to move forward to individual issues trials and there is no reason to postpone providing this information about the common issues trials immediately.
[35]
Disposition
Thus, I approve the notice to the class substantially in the form attached as Schedule A to the notice of motion to be delivered by mail and/or email to each class member at their last known address, which is to be provided by the defendants to class Counsel and to Epiq, which is appointed notice administrator.
36I also require the defendants to advise class counsel whether each member of the Professional Allowance Class signed the 2002 Associate Agreement, the 2010 Associate Agreement or both versions of the Associate Agreement.
37Epiq does not need this information, but the class members and class counsel require this information in order to: (a) give input about the appeal; (b) give input should there be any settlement negotiations; (c) and to be in a position to move forward should the appeals be favourable for the class.
38As I indicated in my judgment, because of the operation of the Associate Agreement, not every Ontario class member will have suffered damages, but in order to determine whether they did suffer damages, it is necessary to determine what contract is engaged. For all the above reasons, Class Counsel should have this information to advise its clients about their individual rights whatever the outcome of the appeal.
39Finally, I require the defendants to reimburse the plaintiffs for one half of the reasonable expenses associated with the notice to the class members.
40For the above reasons, the plaintiffs’ motion is granted with costs to the Plaintiffs of $10,000, as agreed by the parties to be paid to the successful party.
Perell, J.
Released: August 10, 2023