Serge Kalloghlian

Two consolidated appeals concerning the interpretation of leave provisions in certification orders for class actions relating to trailing commissions paid to mutual fund managers.

The appellants (mutual fund managers) argued that new class actions commenced by different plaintiffs on behalf of different classes should have required leave under the certification orders because they related to the same subject matter.

The motion judge and Court of Appeal held that the leave requirement applied only to proceedings by the certified class members and parties to the original actions, not to new plaintiffs seeking to represent different classes.

The court dismissed the appeals, affirming that the leave provisions were limited in scope to the parties and class members bound by the original certification orders.

In this putative securities class action arising from alleged misconduct by the former CEO of Endeavour Mining, the plaintiffs moved for an order requiring defendants to deliver statements of defence and produce insurance information by November 21, 2025.

The defendants opposed both requests, arguing that no statement of defence is required before leave to proceed is granted under the Securities Act, and that insurance information disclosure is premature.

The court dismissed both aspects of the motion, finding that prior to OSA leave being granted, the statutory claim is a nullity and therefore no defence is required, and that insurance disclosure is premature absent settlement discussions or leave being granted.

On a motion under the Class Proceedings Act, 1992, the court approved the settlement of a class action alleging that a mutual fund manager and trustee improperly paid trailing commissions to discount brokers, thereby diminishing fund assets.

The court held the $8.5 million non-reversionary settlement was fair, reasonable, and in the best interests of the class, emphasizing the arms’-length negotiations, substantial litigation risks, limitation defences, expert-supported valuation, and efficient distribution method combining direct deposits for current unitholders with a simplified claims process for former unitholders.

The court also approved class counsel fees, taxes, disbursements, litigation funding payments, and a modest honorarium for the representative plaintiff.

The certification question itself was not decided on this motion.

The court dismissed the plaintiff’s motion to compel the discovery of Anna Shlimak, a former consultant to Cronos Group Inc., either as a corporate representative or as a non-party.

The court found that the plaintiff had not met the requirements under the Rules of Civil Procedure for examining a non-party or a second corporate representative, as there was no evidence that the information sought could not be obtained from the existing corporate representative, Michael Gorenstein, or that he was unwilling or unable to provide complete answers.

The court also noted that the plaintiff had voluntarily declined a further day of examination with Gorenstein.

The defendants’ offer to answer written interrogatories, including those requiring input from Shlimak, was found to be a reasonable alternative.

Costs of $10,000 were awarded to the defendants.

The defendants in several related class actions brought motions for summary judgment, arguing that the plaintiffs' actions were statute-barred by limitation periods or were a nullity for failing to obtain leave to commence.

The court adjourned the limitation period motions, finding they overlapped with common issues in earlier certified class actions.

The court dismissed the motions based on the leave requirement, interpreting the certification orders' leave provisions as applying only to competing class actions representing the same class members, not to actions by different classes arising from the same factual matrix.

The moving parties sought leave to appeal a decision granting the responding party leave to commence an action under s. 138.8 of the Securities Act.

The Divisional Court granted leave to appeal, identifying specific questions regarding whether the motions judge erred in holding that the Court of Appeal erred in a previous decision, and whether such an error rendered the decision unsafe.

Costs of the motion were fixed at $20,000, payable in the discretion of the appeal panel.

The plaintiff moved, with the defendant's consent, for an order certifying a class proceeding for settlement purposes under the Class Proceedings Act, 1992.

The action concerned the payment of trailing commissions to discount brokers from TD Mutual Funds, allegedly diminishing unit value due to breach of fiduciary duty.

The court found all certification criteria met, including disclosure of a cause of action, an identifiable class, common issues (breach of fiduciary duty), and that a class proceeding was the preferable procedure, especially in the context of a settlement.

The proposed representative plaintiff was deemed adequate, and the notice plan, long-form and short-form notices, and opt-out process were approved.

The action was certified for settlement purposes.

Three law firms brought competing carriage motions to represent a class of shareholders of Canopy Growth Corporation in a securities misrepresentation class action.

The court evaluated the competing claims under s. 13.1(4) of the Class Proceedings Act, 1992.

The court granted carriage to the Dziedziejko action, finding that its longer class period, which included thousands of additional shareholders based on prior financial misrepresentations, better served the goals of access to justice and behaviour modification without sacrificing efficiency.

The competing Leonard and Twidale actions were stayed.

The plaintiffs in several 2018 class actions (the "2018 actions") brought a motion to temporarily stay overlapping 2022 class actions (the "2022 actions").

Both sets of actions alleged that defendants, as mutual fund trustees and managers, improperly paid trailing commissions.

The 2018 plaintiffs argued that losses were suffered only by those who purchased through discount brokers, while the 2022 plaintiffs contended that losses were incurred by all mutual fund holders, as fees were paid from the funds.

The court granted the temporary stay of the 2022 actions, finding substantial overlap and shared factual background, which would prevent unnecessary duplication of judicial and legal resources.

The court addressed potential prejudice to the 2022 plaintiffs by ordering the suspension of the relevant limitation period and by bifurcating the "separate series" and allocation issues for later litigation, ensuring that the 2022 plaintiffs' interests would be addressed when they diverged from the 2018 plaintiffs.

This endorsement addresses the sequencing of motions in a series of related class actions.

The 2018 plaintiffs sought a temporary stay of the 2022 actions.

The defendants proposed hearing the stay motion concurrently with their summary judgment motions, citing limitation period defenses.

The 2022 plaintiffs argued for their certification motion to proceed if the stay was delayed.

The court, acting as case management judge, directed that the motion to stay be heard first, finding no significant efficiencies in combining it with the summary judgment motions and stating that certification motions should only proceed after summary judgment motions are determined.

The plaintiffs in two putative class actions sought leave to discontinue one action entirely and partially discontinue the second against all but one defendant group.

This procedural step aimed to streamline the proceedings by converting omnibus actions into separate class proceedings against distinct defendant groups.

The defendants did not oppose the requests.

The court granted leave for both discontinuances, recognizing the efficiency gains.

The plaintiff brought a motion to certify a class action against a trust company that acted as the trustee for registered savings accounts through which class members invested in syndicated mortgages.

The syndicated mortgages, promoted by a third-party developer, failed, resulting in significant losses.

The plaintiff alleged the trust company breached trust, fiduciary, contractual, and common law duties by failing to ensure the mortgages were fully secured and qualified investments under the Income Tax Act.

The court dismissed the certification motion, finding it plain and obvious that the pleadings disclosed no reasonable cause of action, as the trust company did not undertake the alleged gatekeeper duties.

The court also found the proposed omnibus class action failed the common issues, preferable procedure, and representative plaintiff criteria.

The defendant in a proposed class action brought a motion to strike the plaintiff's expert evidence filed in support of certification.

The proposed class action alleged the defendant trust company breached its duties regarding syndicated mortgages held in registered savings accounts.

The court granted the motion to strike the expert's evidence in its entirety, finding the expert was not qualified, lacked independence, acted as a partisan advocate, and improperly provided legal argument and opinions on ultimate issues beyond his expertise.

This is an appeal from a summary judgment dismissing the appellants' action as statute-barred.

The appellants, a former employee and his investment corporation, sued the respondents for breach of a post-retirement compensation agreement, claiming a permanent 3% interest in a partnership.

The motion judge found the claims statute-barred under the Limitations Act, 2002, ruling that a single breach with continuing consequences occurred, not a series of breaches giving rise to a rolling limitation period.

The motion judge also found the request for declaratory relief was, in substance, a claim for compensatory relief and therefore also statute-barred.

The Court of Appeal upheld the motion judge's decision, dismissing the appeal.

The plaintiff moved for certification of a class action on behalf of debenture holders of Discovery Air Inc., alleging oppression by the defendants in a series of transactions that transferred Discovery's primary asset to Clairvest at a material discount.

Clairvest consented to certification but disputed the common issues and sought discovery directions, while the remaining defendants argued the statement of claim disclosed no cause of action against them.

The court found the pleadings sufficiently detailed to disclose a cause of action against the individual directors and the Top Aces entities.

The court certified the action, adopted a broad definition of the common issues with some additions proposed by Clairvest regarding causation and reasonable expectations, and declined to order non-party production or expanded discovery at this early stage.

The plaintiff, a debentureholder, sought to bring a class action for oppression against certain shareholders, directors, and officers of Discovery Air Inc. The defendants argued the plaintiff lacked standing due to a 'no-action clause' in the trust indenture, which they claimed required trustee authority or satisfaction of specific preconditions.

The court found that the trust indenture, when read holistically, did not preclude the plaintiff's direct action.

Alternatively, the court determined that the plaintiff had met the preconditions, including the 25% debentureholder support and a reasonable offer of indemnity, despite the trustee's commercially unreasonable demands.

The plaintiff's motion was granted, allowing the oppression action to proceed.

The Ontario Plaintiff moved to quash the Quebec Plaintiff's appeal of an order dismissing a motion to stay the Ontario class action.

The Court of Appeal held that the refusal to stay the Ontario Action is an interlocutory order, not a final order, because it does not determine any substantive right to relief or substantive defence.

As the order is interlocutory, the appeal lies to the Divisional Court with leave, not to the Court of Appeal.

The appeal was quashed for lack of jurisdiction.

The applicant sought to add the respondent's former counsel as parties to an application and compel them to disclose information regarding ongoing litigation pursuant to an assignment agreement.

The respondent had previously breached a court order to provide this information.

The court allowed the motion to add the law firms as parties, finding it legally tenable and necessary to adjudicate effectively.

The court ordered the law firms to disclose the factual information required by the assignment agreement, exercising its equitable jurisdiction to make orders against non-parties to prevent the facilitation of a party's defiance of a court order.

However, the court refused to order the disclosure of broader information protected by solicitor-client privilege, finding no implicit waiver of privilege in the assignment agreement.

The appellant successfully appealed a summary judgment in a class proceeding.

The motion judge had found that the auditor owed a duty of care to the investor clients of Buckingham Securities regarding the audit of Form 9 reports filed with the Ontario Securities Commission.

The Court of Appeal reversed this decision, finding no duty of care was owed despite the auditor's negligence.

The appeal addressed the application of the Anns/Cooper test for establishing duty of care.

The court awarded the successful appellant costs on a partial indemnity basis.

A class action was brought against an auditor for negligently auditing Form 9 reports filed with the Ontario Securities Commission that falsely confirmed a securities dealer's compliance with segregation and minimum capital requirements.

The dealer subsequently failed and investors lost millions.

The motion judge granted summary judgment for the class, finding the auditor owed a duty of care.

The Court of Appeal reversed, holding that no duty of care existed because there was insufficient proximity between the auditor and the class members.

The class members never saw or knew of the Form 9 reports, made no representations to them, and the interposition of the OSC and the dealer between the auditor and the class rendered the relationship too remote.