In Dufault v Toronto Dominion Bank, 2021 ONSC 6223, the Ontario Superior Court considered the sequencing of pre-certification motions under s. 4.1 of the amended Class Proceedings Act for the first time. The amendment provides as follows:
Early resolution of issues
4.1 If, before the hearing of the motion for certification, a motion is made under the rules of court that may dispose of the proceeding in whole or in part, or narrow the issues to be determined or the evidence to be adduced in the proceeding, that motion shall be heard and disposed of before the motion for certification, unless the court orders that the two motions be heard together. [emphasis added]
Under this sequencing provision, the defendant bank moved for summary judgment, requesting that its motion be heard before the plaintiff’s motion for certification. The plaintiff argued that the motions ought to be heard together.
In looking to s. 4.1, Justice Belobaba held that the legislative intention was clear: “if a pre-certification motion can arguably dispose of the proceeding in whole or in part, or can narrow the issues or the evidence, the motion must be heard before certification, unless the court orders that the two motions be heard together.”
The plaintiff, Mr. Dufault, alleged that the defendant bank unlawfully earned millions of dollars by charging multiple NSF fees on a single rejected payment or bounced cheque. On the motion, the defendant bank led evidence demonstrating that the plaintiff was contractually precluded from bringing such claims. Accordingly, His Honour granted the defendant bank’s request to schedule the motion for summary judgment before the plaintiff’s certification motion.
On its face, Dufault looks bad for plaintiffs. It appears to interpret the amended legislation in a manner that provides defendants with one more tool to frustrate a plaintiff’s claim—a presumptive right to have certain motions heard and decided before the plaintiff’s motion for certification. But, with a little more perspective, not much is changed.
A plaintiff can displace the s. 4.1 presumption by persuading the court that there is “an overarching and good reason for the two motions to be heard together.” Indeed, in his decision, Justice Belobaba observed there are “at least two good reasons” for denying a defendant’s request: (i) the defendant’s motion does not raise any genuinely arguable issues that can narrow or dispose of all or part of the litigation and appears to be a delay tactic; or (ii) the defendant’s motion does raise genuinely arguable issues that can narrow or dispose of all or part of the litigation but the existing or proposed dates for the certification motion and the summary judgment motion are sufficiently close that it makes sense to hear the two motions together.
This kind of judicial discretion is good and useful. It helps dispose of weak cases quickly. Before an action is certified as a class proceeding, it is nothing more than a putative claim. Certification is a procedural motion that tests the form, rather than the substance, of that claim. If good cases with strong evidentiary foundations survive initial summary judgment challenges, it follows that they will be certified as a matter of course. Such determinations may also assist in pushing the parties towards settlement. However, if a claim is weak, it is likely better to lose early and move on, than to have wasted time and resources.
Finally, one practical takeaway for plaintiff’s counsel is that certification records ought to be filed, and certification motions scheduled, as soon as practicable. In reaching his decision to hear the defendant bank’s summary judgment motion before the plaintiff’s certification motion, Justice Belobaba noted that “no certification record has been filed and the certification motion has not even been scheduled,” and on that basis determined there was “no good reason to deny the defendant’s request.”