Difference between revisions of "Class Actions in British Columbia"

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{{REVIEWEDPLS | reviewer = [https://emlawyers.ca/people/lawyers/jason-z-murray/ Jason Murray], Eyford Macaulay Shaw & Padmanabhan LLP|date= October 2017}} {{Dial-A-Law TOC|expanded = courts}}
It’s a familiar story: a business makes a defective product or does something that harms a group of people. Such a “mass wrong” can be met with a class action.


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==What you should know==
==What is a class action?==
Mass production and marketing of consumer goods and services means that a single mistake or wrongful act at any stage of design, production, or distribution can injure or cause loss to many people in a similar way. One response to these injuries or losses (called “mass wrongs”) is a “class action” – a lawsuit that groups people with a common claim together against the same defendant.  A class action deals with several claims that would otherwise be separate lawsuits.


==A class action is cost effective==
===A class action is brought by an individual acting on behalf of a larger group===
Often, injured people won’t sue individually because the amount of money they seek is too small compared to their legal costs. And it’s often not practical for just one buyer of a defective product to sue a large manufacturer. But the total loss or damages suffered by many injured people or buyers may be very large. Class actions make lawsuits more affordable by allowing all the victims of a mass wrong to, in effect, share the cost of a lawsuit. You might say that class actions allow “mass-produced lawsuits” for “mass-produced wrongs.
A '''class action''' is a lawsuit that groups people with a common claim together against the same defendant. Otherwise, all the claims would be separate lawsuits. Mass production and marketing of consumer goods and services mean that a single mistake or wrongful act at any stage of design, production or distribution can harm many people in a similar way. A class action is one response to these injuries or losses (also called '''mass wrongs''').


==What kinds of cases are suitable for a class action?==
Often, injured people won’t sue individually because the money they seek is less than their legal costs. And it’s often not practical for just one buyer of a defective product to sue a large business. But the total loss or damages suffered by many injured people or buyers may be very large. Class actions make lawsuits more affordable by allowing all the victims of a mass wrong to share the cost of a lawsuit. Class actions are mass-produced lawsuits for mass-produced wrongs.
Class actions are often used in product liability cases when a manufactured item, like a drug or a vehicle, is defective and injures many people. Class actions are also common against governments, banks, and businesses related to the stock market – for overpayment of taxes, illegal service charges, misrepresentations, and even systemic discrimination. Class actions may also be brought against companies for price fixing, monopolization and providing misleading information. Whenever a mistake or wrongful act affects many people, a class action may be effective.


==What court hears a class action?==
===Some kinds of cases lend themselves to a class action===
Class actions have been part of the legal landscape in British Columbia since 1996. They are governed by the ''Class Proceedings Act''. It lets one person sue in the BC Supreme Court on behalf of a group of people if they have similar claims against the same wrongdoer. The Federal Court of Canada also allows certain class actions involving federal law and the federal government.
Class actions work well in “product liability” cases. These cases involve a manufactured item, like a drug or a vehicle, that is defective and injures many people. Class actions are also common against governments (for overpayment of taxes), against financial institutions (for illegal service charges), and against companies trading on the stock market (for misrepresentations). Class actions may also work against businesses for price fixing, monopolizing the market, and misleading advertising. They can work to fight systemic discrimination against governments or businesses. Whenever a mistake or wrongful act affects many people, a class action may be effective. Class actions have been possible in British Columbia since 1996.


==How is a class action started?==
===Starting a class action===
Under BC law, a person who has been hurt or suffered loss can apply to the BC Supreme Court to be the “representative plaintiff” in a lawsuit on behalf of a group of people. These people also have to ask the court to “certify” the lawsuit as a “class proceeding.The lawyer for the representative plaintiff becomes the lawyer for all the class members. A defendant to two or more proceedings may also ask the court to convert those proceedings to a class proceeding.
The ''[http://canlii.ca/t/84g6 Class Proceedings Act]'' lets one person sue in BC Supreme Court for a group of people if they have similar claims against the same wrongdoer. The Federal Court of Canada also allows certain class actions involving federal law and the federal government.


==Certification is the most important stage in a class action==
A person who has been hurt or suffered loss can apply to BC Supreme Court to be the '''representative plaintiff''' in a lawsuit for a group of people. The representative plaintiff must also ask the court to '''certify''' the lawsuit as a '''class proceeding'''.
Almost all class actions that are certified go on to be settled. If a court doesn’t certify a class action, the members of the group can usually sue individually, as if the class action had never started.


==What’s needed to get a court to certify a class action?==
Once the court certifies a lawsuit, it appoints the lawyer for the representative plaintiff as class counsel. This lawyer is then the lawyer for all the class members.
The court must certify the lawsuit as a class action if the following five criteria are satisfied:
#The document that the plaintiff files in court (called the Notice of Civil Claim) shows a legally valid claim based on a mistake or wrongful act.
#The court can identify two or more people as a class, who are then called class members. The class is easily defined, so individuals can readily identify whether they fit into the class. (In some cases, classes are further divided into subclasses.)
#There are common issues in the claims of the class members.
#A class action is the best way to fairly and efficiently resolve the common issues.
#There is a representative plaintiff – someone who can represent all the members of the class.


==There are three requirements for the representative plaintiff==
A defendant in two or more cases can also ask the court to convert the cases into a class action.
A representative plaintiff:
#Must fairly represent the interests of the class members.
#Must have a plan to run the class action for the class members and notify them of the lawsuit.
#Must not have an interest conflicting with interests of other class members on the common issues.


==How do you decide whether there should be a class action?==
Many class actions that are certified are eventually settled. If a court doesn’t certify a class action, the members of the group can usually sue individually, as if the class action had never started.
People who are thinking of using a class action should consider the following things:
 
#Has a class action dealing with the same issues already been filed?
===What a court needs to certify a class action===
#Is a class action a fair and efficient way to solve the common issues?
The court must certify the lawsuit as a class action if the following five criteria are met:
#Are the common issues more important than the individual issues?
 
#Is a lawsuit the best way to solve the claims? Has the defendant come up with other ways to compensate class members?
* The document the plaintiff files in court (called the “notice of claim”) shows a '''legally valid claim''' based on a mistake or wrongful act.
#What type of lawsuit is best for the case: class action or individual?
* The court can identify two or more people as a '''class''', who are then the class members. The class is easily defined, so people can easily tell if they fit into the class. (In some cases, classes are again divided into subclasses.)
#Is a class action too complicated?
* There are '''common issues''' in the claims of the class members.
* A class action is the best way to '''fairly and efficiently resolve''' the common issues.
* There is a '''representative plaintiff''' — someone to represent all the members of the class.
 
===A representative plaintiff must meet certain criteria===
A representative plaintiff must:
* fairly represent the interests of the class members,
* have a plan to run the class action for the class members and notify them of the lawsuit, and
* not have an interest that conflicts with interests of other class members on the common issues.
 
In almost all cases, the representative plaintiff must live in BC. If appropriate, the court will appoint a non-BC resident to represent a class of people who do not live in BC.
 
===Class members are identified===
Some class members must live in British Columbia, but (in certain cases) not all class members have to live in BC. If there are both resident and non-resident class members, the court will certify a separate class of non-residents.
 
Non-residents must formally '''opt in''' to the class action, meaning they must choose to be part of it. That’s not true for BC residents — they are automatically in unless they '''opt out''' (as explained shortly). When the court certifies a class action, it will state how and by when non-residents can opt in to the class action.


For example, a class action is not appropriate when individual issues that have to be determined would overwhelm any benefit from determination of the common issues. In these cases, there is a risk of long and complex individual trials after the common issues are determined.
====Advertising to find potential class members====
People can advertise to find potential class members to start a class action. The law does not deal with advertising. But it’s usually not necessary because only two or more people are needed to form a class. Any advertising would have to be careful not to promise financial gain for joining the class action.


==Class members must be notified of a class action==
====Class members must be informed of a class action====
Many class members wouldn’t know if a class action has been started and certified by the court. To protect these people, the representative plaintiff must notify the class members of the class action in a way approved by the court. This notice can be by letter if the class members are known; otherwise, it will most often be by newspaper or magazine advertising. Class members must also be notified of any determination of common issues and any settlement.
Many class members wouldn’t know if a class action has been started and certified by the court. To protect these people, the representative plaintiff, through the class counsel, must '''notify''' the class members of the class action in a way the court approves. This notice can be by letter if the class members are known; otherwise, it will most often be done by newspaper or magazine advertising. Class members must also be notified of any decision on the common issues and any settlement.


==Can class members opt out of a class action?==
====Class members can drop out (or opt out) of a class action====
Class members can choose not to be part of a class action (or “opt out” of it) if they want to sue on their own. To opt out, they must usually fill out a form or write a letter to the court or the lawyer of the representative plaintiff. People who don’t opt out have to accept the result of the class action.
Class members can choose not to be part of a class action (or '''opt out''' of it) if they want to sue on their own. The court sets a deadline for people to opt out. To do that, people must usually fill out a form or write a letter to the court or the class counsel. People who don’t opt out by the deadline must accept the result of the class action.


==A judge supervises the lawsuit for all class members==
===A judge supervises the class action for all class members===
Even if class members know about a class action, most of them probably won’t be in court. To protect their interests, a judge supervises every stage of the class action, from start to end. The judge looks out for the best interests of the class as a whole, not just the representative plaintiff, to ensure both the process and results are fair. If the representative plaintiff agrees to settle the class action, the judge will ensure that a notice to class members is published and that the settlement is fair, reasonable and in the best interests of the class as a whole.
Even if class members know about a class action, most of them probably won’t be in court. To protect them, a judge '''supervises''' every stage of the class action. The judge looks out for the best interests of the class as a whole, not just the representative plaintiff, to ensure both the process and results are fair.


==How is a judgment made?==
If the representative plaintiff '''settles''' the class action, the judge will ensure that a notice to class members is published and that the settlement is fair, reasonable and in the best interests of the class as a whole. That does not mean all class members get the same amount. Different members in different situations may receive different amounts.
The court can assess compensation for the class as a whole without proof of individual claims. It may use statistical evidence when assessing the amount. After this assessment, the court can award individual class members compensation as a proportion of the total amount, or it can decide their compensation individually.


==Paying the defendant’s legal costs is usually not a risk==
===A court decides on compensation for class members===
With class actions, an unsuccessful representative plaintiff in BC doesn’t usually have to pay part of the defendant’s legal costs (which can happen in individual lawsuits). So starting a class action is not as risky as starting an individual lawsuit. This “no costs” regime in BC is meant to increase people’s access to justice. Not all Canadian provinces operated on a “no costs” basis.
The court can decide on compensation for the whole class, without proof of individual claims. It may use statistical evidence to calculate the amount. Then the court can award individual class members compensation as a proportion of the total amount, or it can decide their compensation individually.


==Can you appeal a class action?==
==Common questions==
Any member of the class may appeal an order to certify a proceeding as a class, a refusal to certify a proceeding as a class, or a judgment on a common issue.


==Class actions are becoming more common==
===How do people decide whether to start a class action?===
The trend towards more frequent class actions will probably continue now that all 13 jurisdictions in Canada have class action laws. The Canadian Bar Association hosts a National Class Action Database, designed to give lawyers and the public easy access to court documents submitted in relation to class action lawsuits currently underway across the country. In BC, registration with the Database is mandatory. You can search the Database at [http://www.cba.org/CBA_ClassAction/Search.aspx www.cba.org/CBA_ClassAction/Search.aspx].
People who are thinking of using a class action should consider the following things:
* Has a class action dealing with the same issues already been started?
* Is a class action a fair and efficient way to resolve the common issues?
* Are the common issues more important than the individual issues?
* Is a lawsuit the best way to resolve the claims? Has the defendant come up with other ways to compensate class members?
* What type of lawsuit is best for the case — class action or individual?
* Is a class action too complicated?


==Summary==
For example, a class action is not appropriate if individual issues would overwhelm any benefit from settling the common issues. In these cases, there is a risk of long and complex individual trials after the common issues are settled.
Class actions are complicated, but they’re often an effective way to make several claims collectively against one or a few wrongdoers. If you think a class action may be best in your case, you should speak to a lawyer. If you get notice of a class action that might affect you, you may also want to see a lawyer to find out whether you should participate in the lawsuit.


===Does an unsuccessful representative plaintiff need to pay the defendant’s legal costs?===
In class actions, an unsuccessful representative plaintiff in BC doesn’t usually have to pay part of the defendant’s legal costs (which can happen in individual lawsuits). So starting a class action is not as risky as starting an individual lawsuit. This “'''no costs'''” system tries to increase people’s access to justice. Not all Canadian provinces operate on a “no costs” basis.


[updated April 2013]
===Can a class action decision be appealed?===
Yes, any member of the class may appeal an order that certifies a lawsuit as a class action, a refusal to certify a lawsuit, or a judgment on a common issue. And defendants can also appeal an order that certifies a class action or a judgment on a common issue.


==Who can help==


----
===With more information===
----
The trend towards more frequent class actions will probably continue as every Canadian jurisdiction now has class action laws. The '''Canadian Bar Association''' offers a searchable '''National Class Action Database'''. It gives lawyers and the public easy access to court documents for class action lawsuits across the country.


* [https://www.cba.org/Publications-Resources/Class-Action-Database Visit website]


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Latest revision as of 03:28, 28 October 2020

This information applies to British Columbia, Canada. Last reviewed for legal accuracy by Jason Murray, Eyford Macaulay Shaw & Padmanabhan LLP in October 2017.

It’s a familiar story: a business makes a defective product or does something that harms a group of people. Such a “mass wrong” can be met with a class action.

What you should know

A class action is brought by an individual acting on behalf of a larger group

A class action is a lawsuit that groups people with a common claim together against the same defendant. Otherwise, all the claims would be separate lawsuits. Mass production and marketing of consumer goods and services mean that a single mistake or wrongful act at any stage of design, production or distribution can harm many people in a similar way. A class action is one response to these injuries or losses (also called mass wrongs).

Often, injured people won’t sue individually because the money they seek is less than their legal costs. And it’s often not practical for just one buyer of a defective product to sue a large business. But the total loss or damages suffered by many injured people or buyers may be very large. Class actions make lawsuits more affordable by allowing all the victims of a mass wrong to share the cost of a lawsuit. Class actions are mass-produced lawsuits for mass-produced wrongs.

Some kinds of cases lend themselves to a class action

Class actions work well in “product liability” cases. These cases involve a manufactured item, like a drug or a vehicle, that is defective and injures many people. Class actions are also common against governments (for overpayment of taxes), against financial institutions (for illegal service charges), and against companies trading on the stock market (for misrepresentations). Class actions may also work against businesses for price fixing, monopolizing the market, and misleading advertising. They can work to fight systemic discrimination against governments or businesses. Whenever a mistake or wrongful act affects many people, a class action may be effective. Class actions have been possible in British Columbia since 1996.

Starting a class action

The Class Proceedings Act lets one person sue in BC Supreme Court for a group of people if they have similar claims against the same wrongdoer. The Federal Court of Canada also allows certain class actions involving federal law and the federal government.

A person who has been hurt or suffered loss can apply to BC Supreme Court to be the representative plaintiff in a lawsuit for a group of people. The representative plaintiff must also ask the court to certify the lawsuit as a class proceeding.

Once the court certifies a lawsuit, it appoints the lawyer for the representative plaintiff as class counsel. This lawyer is then the lawyer for all the class members.

A defendant in two or more cases can also ask the court to convert the cases into a class action.

Many class actions that are certified are eventually settled. If a court doesn’t certify a class action, the members of the group can usually sue individually, as if the class action had never started.

What a court needs to certify a class action

The court must certify the lawsuit as a class action if the following five criteria are met:

  • The document the plaintiff files in court (called the “notice of claim”) shows a legally valid claim based on a mistake or wrongful act.
  • The court can identify two or more people as a class, who are then the class members. The class is easily defined, so people can easily tell if they fit into the class. (In some cases, classes are again divided into subclasses.)
  • There are common issues in the claims of the class members.
  • A class action is the best way to fairly and efficiently resolve the common issues.
  • There is a representative plaintiff — someone to represent all the members of the class.

A representative plaintiff must meet certain criteria

A representative plaintiff must:

  • fairly represent the interests of the class members,
  • have a plan to run the class action for the class members and notify them of the lawsuit, and
  • not have an interest that conflicts with interests of other class members on the common issues.

In almost all cases, the representative plaintiff must live in BC. If appropriate, the court will appoint a non-BC resident to represent a class of people who do not live in BC.

Class members are identified

Some class members must live in British Columbia, but (in certain cases) not all class members have to live in BC. If there are both resident and non-resident class members, the court will certify a separate class of non-residents.

Non-residents must formally opt in to the class action, meaning they must choose to be part of it. That’s not true for BC residents — they are automatically in unless they opt out (as explained shortly). When the court certifies a class action, it will state how and by when non-residents can opt in to the class action.

Advertising to find potential class members

People can advertise to find potential class members to start a class action. The law does not deal with advertising. But it’s usually not necessary because only two or more people are needed to form a class. Any advertising would have to be careful not to promise financial gain for joining the class action.

Class members must be informed of a class action

Many class members wouldn’t know if a class action has been started and certified by the court. To protect these people, the representative plaintiff, through the class counsel, must notify the class members of the class action in a way the court approves. This notice can be by letter if the class members are known; otherwise, it will most often be done by newspaper or magazine advertising. Class members must also be notified of any decision on the common issues and any settlement.

Class members can drop out (or opt out) of a class action

Class members can choose not to be part of a class action (or opt out of it) if they want to sue on their own. The court sets a deadline for people to opt out. To do that, people must usually fill out a form or write a letter to the court or the class counsel. People who don’t opt out by the deadline must accept the result of the class action.

A judge supervises the class action for all class members

Even if class members know about a class action, most of them probably won’t be in court. To protect them, a judge supervises every stage of the class action. The judge looks out for the best interests of the class as a whole, not just the representative plaintiff, to ensure both the process and results are fair.

If the representative plaintiff settles the class action, the judge will ensure that a notice to class members is published and that the settlement is fair, reasonable and in the best interests of the class as a whole. That does not mean all class members get the same amount. Different members in different situations may receive different amounts.

A court decides on compensation for class members

The court can decide on compensation for the whole class, without proof of individual claims. It may use statistical evidence to calculate the amount. Then the court can award individual class members compensation as a proportion of the total amount, or it can decide their compensation individually.

Common questions

How do people decide whether to start a class action?

People who are thinking of using a class action should consider the following things:

  • Has a class action dealing with the same issues already been started?
  • Is a class action a fair and efficient way to resolve the common issues?
  • Are the common issues more important than the individual issues?
  • Is a lawsuit the best way to resolve the claims? Has the defendant come up with other ways to compensate class members?
  • What type of lawsuit is best for the case — class action or individual?
  • Is a class action too complicated?

For example, a class action is not appropriate if individual issues would overwhelm any benefit from settling the common issues. In these cases, there is a risk of long and complex individual trials after the common issues are settled.

Does an unsuccessful representative plaintiff need to pay the defendant’s legal costs?

In class actions, an unsuccessful representative plaintiff in BC doesn’t usually have to pay part of the defendant’s legal costs (which can happen in individual lawsuits). So starting a class action is not as risky as starting an individual lawsuit. This “no costs” system tries to increase people’s access to justice. Not all Canadian provinces operate on a “no costs” basis.

Can a class action decision be appealed?

Yes, any member of the class may appeal an order that certifies a lawsuit as a class action, a refusal to certify a lawsuit, or a judgment on a common issue. And defendants can also appeal an order that certifies a class action or a judgment on a common issue.

Who can help

With more information

The trend towards more frequent class actions will probably continue as every Canadian jurisdiction now has class action laws. The Canadian Bar Association offers a searchable National Class Action Database. It gives lawyers and the public easy access to court documents for class action lawsuits across the country.

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