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Class Actions (Ont) - Aggregate Damages [CPA s.24(1)]. Spina v. Shoppers Drug Mart Inc.
In Spina v. Shoppers Drug Mart Inc. (Ont CA, 2024) the Ontario Court of Appeal considered class action franchise appeals (direct and cross) from summary judgment decisions.
Here the court explores 'aggregate damages', a statutory form of damages [CPA s.24(1)] designed for class actions:(b) The test to allow aggregate damages: the ability to reasonably determine damages without proof by individual class members and access to justice considerations
[196] The test to allow aggregate damages is set out in s. 24(1) of the CPA:24 (1) The court may determine the aggregate or a part of a defendant’s liability to class members and give judgment accordingly where,
(a) monetary relief is claimed on behalf of some or all class members;
(b) no questions of fact or law other than those relating to the assessment of monetary relief remain to be determined in order to establish the amount of the defendant’s monetary liability; and
(c) the aggregate or a part of the defendant’s liability to some or all class members can reasonably be determined without proof by individual class members. [Emphasis added.] [197] Section 24(1)(c) contemplates a “top down” global damages assessment, as opposed to a “bottom up” aggregation of individual claims: Fulawka v. Bank of Nova Scotia, 2012 ONCA 443, 111 O.R. (3d) 346, at para. 126, leave to appeal refused, [2012] S.C.C.A. No. 326.
[198] In Ramdath v. George Brown College, 2014 ONSC 3066, 375 D.L.R. (4th) 488 (“Ramdath (ONSC)”), additional reasons reported at 2014 ONSC 4215, rev’d on other grounds, 2015 ONCA 921, 392 D.L.R. (4th) 490 (“Ramdath (ONCA)”), leave to appeal requested but application for leave discontinued, [2016] S.C.C.A. No. 79, Belobaba J. stated, at para. 1, that “[a]ggregate damage awards should be more the norm, than the exception” because otherwise “the potential of the class action for enhancing access to justice will not be realized.” At para. 47, he outlined the criteria for determining whether a defendant’s monetary liability can be reasonably determined without proof by individual class members:[T]he reliability of the non-individualized evidence that is being presented by the plaintiff; whether the use of this evidence will result in any unfairness or injustice to the defendant (for example, by overstating the defendant’s liability); and whether the denial of an aggregate approach will result in “a wrong eluding an effective remedy” and thus a denial of access to justice. [Footnotes omitted.] [199] The use of these criteria was affirmed by this court in Ramdath (ONCA), at para. 76, and there is no dispute that Ramdath is the governing law.
[200] As noted by Winkler C.J.O. in Fulawka, at para. 118, quoting from the Report of the Attorney General’s Advisory Committee on Class Action Reform, (Toronto: Ministry of the Attorney General of Ontario, 1990) (Chair: Michael G. Cochrane), it may be impractical “to require thousands of class members to individually prove their claims as they would in an ordinary proceeding.” He noted, at para. 126, that the provision in s. 24(1)(c) that states that:[T]he aggregate of the defendant's liability "can reasonably be determined without proof by individual class members"… is directed at those situations where the monetary liability to some or all of the class is ascertainable on a global basis, and is not contingent on proof from individual class members as to the quantum of monetary relief owed to them. In other words, it is a figure arrived at through an aggregate assessment of global damages, as opposed to through an aggregation of individual claims requiring proof from individual class members. I would describe the latter calculation as a "bottom-up" approach, whereas the statute envisages that the assessment under s. 24(1) be “top down”. [Emphasis added.] [201] In Ramdath (ONSC), Belobaba J. concluded that aggregate damages were available for certain categories of “direct costs” or “out-of-pocket” expenses borne by a class of students, two-thirds of whom where foreign students, arising from misrepresentations by George Brown College about the qualifications graduates would receive. He refused however, to award aggregate damages for foregone income lost while attending the eight-month program and income lost as a result of delayed entry into the workforce because the methodology proposed by the plaintiff’s expert was not sufficiently reliable and was predicated on flawed assumptions. For example, the model put forward by the plaintiffs’ expert assumed that the average student who applied to the program was a 25-year-old with a Canadian-recognized bachelor-level university degree. In fact, only about one-third of the domestic students had bachelor’s degrees. Belobaba J. refused to award aggregate damages for these categories of losses, holding that these categories of loss could not be reasonably determined without individualized evidence: at paras. 60-66.
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[205] The motion judge correctly found that under s. 24(1) of the CPA he needed to determine whether “the aggregate or a part of the defendant’s liability to some or all class members can reasonably be determined without proof by individual class members.” He stated that:[637] In Ramdath v. George Brown College, the Ontario Court of Appeal recognized three factors to guide the fairness and reasonableness of an aggregate damages award. The factors were: (a) whether the global evidence presented by the plaintiff was sufficiently reliable; (b) whether use of the evidence would result in unfairness or injustice to the defendant; and (c) whether denial of an aggregate approach would result in a wrong eluding an effective remedy and a denial of access to justice.
[638] Aggregate damages cannot be ordered where “individual questions of fact relating to the determination of each class member’s damages remain to be determined”, or where there is no available data to determine what individual class members were owed. Aggregate damages are not appropriate where the use of non-individualized evidence is not sufficiently reliable, or where the use of that evidence will result in unfairness or injustice to the defendant, such as overstatement of its liability for damages. [Footnotes omitted.] ....
[216] In Fresco v. Canadian Imperial Bank of Commerce, 2022 ONCA 115, 160 O.R. (3d) 173, this court, quoting Shah v. LG Chem Ltd., 2018 ONCA 819, 142 O.R. (3d) 721, at para. 104, leave to appeal refused, [2018] S.C.C.A. No. 520, stated, at para. 67, that:The test for certifying aggregate damages as a common question is whether there is “a ‘reasonable likelihood’ that the conditions required in s. 24 of the CPA for determining aggregate damages would be satisfied if the [appellants are] otherwise successful at the common issues trial”. [Footnote omitted.]
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