The moving parties sought court approval of a proposed settlement in a certified class proceeding relating to a leveraged charitable donation tax shelter.
Participants had claimed inflated charitable tax credits based on loans and security deposits connected to the program, which were later disallowed by the Canada Revenue Agency.
The settlement provided for an $11 million payment by a defendant law firm alleged to have issued legal opinions supporting the program’s legality, with funds distributed to class members and covering counsel fees and administration.
The court applied established factors governing settlement approval in class proceedings and found the agreement fair, reasonable, and in the best interests of the class given significant litigation risks.
The court also approved class counsel fees but declined to award additional compensation to the representative plaintiffs, finding their contribution commendable but not exceptional.
