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Cross-Jurisdictional Problems - Class Actions. Sanis Health Inc. v. British Columbia
In Sanis Health Inc. v. British Columbia (SCC, 2024) the Supreme Court of Canada dismissed an appeal, that against a BCCA decision dismissing an appeal, that of a dismissal by the BC Superior Court of an application by the corporate defendants in a consumer opioid damages class action, who sought an interlocutory division-of-powers ultra vires declaration against a class-action-supporting BC statutory provision [the 'Opioid Damages and Health Care Costs Recovery Act, s.11'].
These passages are quite interesting for the isolation of the Crown's private 'litigation autonomy', when it acts as a 'natural person' - and from a number of other perspectives (eg. cabinet, legislature, crown plaintiff litigation, delegated legislation, interjurisdictional class actions and the pressing - though rarely acknowledged - issues of both Canadian and international cross-jurisdictional problems:(2) Does Section 11 Respect the Legislative Sovereignty of Other Canadian Governments?
[95] The appellants argue that s. 11 fails to respect the legislative sovereignty of other Canadian governments by forcing them to either opt out of the proceeding, or else opt in and fetter their sovereignty by giving away their ability to legislate regarding their substantive opioid-related healthcare cost recovery rights or their litigation autonomy over those rights. They say that the support of the other governments for this legislation is irrelevant.
[96] As I have explained, the appellants’ concerns about the binding effects on another province’s litigation autonomy does not undermine its sovereignty. Litigation involves consequences and those consequences may be inescapable, especially when they occur in jurisdictions beyond the control of a government’s legislature. There is no constitutional principle against this. The appellants’ arguments blur the distinction between legislative and executive authority. The legislature of one level of government cannot transfer its primary authority to legislate to another level of government (Reference re Pan-Canadian Securities Regulation, at paras. 75-76). However, no such rule applies to the executive delegation of litigation conduct.
[97] Of course, a government cannot displace existing laws through executive action and the “legislature is entitled to enact legislation inconsistent with the government’s commitments under a prior agreement” (Canada (Attorney General) v. British Columbia Investment Management Corp., 2019 SCC 63, [2019] 4 S.C.R. 559, at para. 92). Thus, as a general constitutional principle, neither the executive, nor the legislature itself, can bind a future legislature in its exercise of authority (Reference re Pan-Canadian Securities Regulation, at paras. 54-59; Wells v. Newfoundland, 1999 CanLII 657 (SCC), [1999] 3 S.C.R. 199, at para. 37; Reference re Canada Assistance Plan (B.C.), 1991 CanLII 74 (SCC), [1991] 2 S.C.R. 525, at p. 560).
[98] But this general principle hits its limit when a Crown exercises its civil rights, in its capacity as a natural person, in areas where its legislature has no authority to enact laws. Aside from effects on a Crown’s desire to litigate as they wish in foreign territory, when Crowns act in their capacity as a natural person in other jurisdictions they may also have to accept legal consequences that fall outside their legislative competence, such as the creation of private rights and duties in other provinces. For example, when a Crown enters into a contract in another province, that contract will fall under the legislative competence of that other province’s authority over “Property and Civil Rights in the Province” (s. 92(13) of the Constitution Act, 1867). The contracting Crown’s legislature could not enact a law to cancel those extra-provincial contractual rights, and it will be bound by that contractual obligation in the same way as an individual (see Churchill Falls, at pp. 332-33; see also Bank of Montreal v. Attorney General (Quebec), 1978 CanLII 173 (SCC), [1979] 1 S.C.R. 565, at p. 574).
[99] So when a Crown exercises the same civil rights as an individual, it will be bound by the consequences of its actions undertaken in another province when those actions fall under that other province’s legislative sovereignty. Despite being sovereign in its own territory over these subject matters, a Crown cannot legislate itself out of situations it might have controlled at home. Nothing forces one province to engage in activities elsewhere, but when they do, they must abide by the laws of that other province (see D. Gibson, “Interjurisdictional Immunity in Canadian Federalism” (1969), 47 Can. Bar Rev. 40, at p. 60; Hogg and Wright, at § 10:20).
[100] This is the case when a Crown exercises its civil rights by participating as a non-representative plaintiff in a class action in another province. It will find itself subject to that province’s procedural rules governing class actions, including procedural rules relating to the binding nature of the court’s judgments or any settlements negotiated by the parties (CPA, ss. 26 and 35).
[101] However, the application of those procedural rules to the foreign, participating Crowns does not determine which substantive laws will apply to those Crowns (see Wilson, at para. 83; Thorpe, at para. 135; Walker, at § 4.03). Here, the harms underlying each Crown’s causes of action occurred in their own jurisdictions and thus are subject to their own substantive law (see Tolofson v. Jensen, 1994 CanLII 44 (SCC), [1994] 3 S.C.R. 1022, at pp. 1050 and 1064-65; Unifund Assurance Co. v. Insurance Corp. of British Columbia, 2003 SCC 40, [2003] 2 S.C.R. 63, at paras. 25 and 80; Van Breda, at para. 37; Walker, at § 1.02[2][e]). That substantive law remains subject to each legislature’s sovereignty, including their own ORA-type legislation to establish their causes of action.
[102] I also do not agree that s. 11 fails to respect the sovereignty of other governments because of the potential for overlap and conflict between their various ORA-type statutes and the litigation they authorize. Multi-jurisdictional legislative overlap is normal in a federation; so long as it occurs within the proper legislative authority of the enacting governments, it is not problematic (see Canada (Attorney General) v. PHS Community Services Society, 2011 SCC 44, [2011] 3 S.C.R. 134, at para. 62; Canadian Western Bank, at paras. 36-37). Multi-Crown participation in a national class action, where each is authorized by its own law, represents cooperation between different governments and comity between the courts.
[103] Intergovernmental cooperation in Canada recognizes that some amount of overlap is inevitable regarding national issues like the opioid epidemic, and that “governments should be permitted to legislate for their own valid purposes in these areas of overlap” (PHS Community Services Society, at para. 62). While the courts remain the ultimate arbiters of the constitutionality of governments’ efforts to regulate nationwide issues like these, the day-to-day task of maintaining the balance of powers regarding cooperative legislative schemes “falls primarily to governments” (Canadian Western Bank, at para. 24).
[104] Here, nearly every provincial and territorial government in Canada has chosen to cooperate by enacting virtually identical statutes, by indicating their intent to participate as class members, and by intervening in this appeal supporting B.C. The federal government, which also intervened in support of the respondent, has indicated its intent to participate in the class action as well (House of Commons Debates, vol. 151, No. 216, 1st Sess., 44th Parl., June 19, 2023, at p. 16247 (Hon. Carolyn Bennett)). This multi-Crown participation is in harmony with our Court’s approach to intergovernmental cooperation on national issues, where collaboration between the executives and legislatures of both provincial and federal governments is vital. Especially given the presumption of constitutionality of legislation, a court should exercise considerable caution before it finds that this cooperation between multiple executive and legislative branches is unconstitutional (see Murray-Hall, at paras. 79 and 82; Reference re Impact Assessment Act, at para. 69; Kitkatla, at paras. 72-73; OPSEU, at pp. 19-20).
[105] As for the judicial branch of government, this Court has recognized that “[g]reater comity is required in our modern era when international transactions involve a constant flow of products, wealth and people across the globe” (Hunt, at p. 292). The courts in our federation provide a comparable quality of justice, and so demand the same level of faith in one another’s judgments where jurisdiction has been properly exercised (Morguard, at p. 1099). If overlapping litigation arises, courts acting in respect of one another have the tools to prevent any abuse of process (see, e.g., CPA, ss. 4(3) to 4.1). Comity between our federation’s courts helps with access to justice in a world where people and problems cross borders without heed for which legislature or court has authority over them.
[106] This is true in class actions, whose “purpose is to facilitate access to justice for citizens who share common problems and would otherwise have little incentive to apply to the courts on an individual basis to assert their rights” (Bisaillon, at para. 16). This Court has noted that class actions serve judicial economy, promote access to justice, and modify the behaviour of wrongdoers who might otherwise escape accountability for their actions (Dutton, at paras. 27-29; Hollick, at para. 15). These goals are met where governments cooperate with one another to have their claims litigated efficiently, in one action, before one province’s superior court, whose proceedings and judgment will be respected through the principle of comity in the other courts of our federation.
[107] Section 11 of the ORA therefore respects the legislative sovereignty of foreign Crowns. It is an example of the important role that national class actions play in matters which span the country, by providing a mechanism to help multiple governments cooperate while working toward the same goal.
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