Class actions are allowed in most Canadian provinces. Several recent developments, including application of lax certification procedures and the spread of third party litigation funding (TPLF), suggest that Canada is becoming even more hospitable to class actions.
Because TPLF is largely unregulated in Canada, courts addressing class action funding contracts have established piecemeal standards, creating inconsistency across cases. While judicial oversight is a legislative requirement in representative proceedings, non-representative proceedings where TPLF is also used, such as personal injury or commercial litigation, are not subject to judicial controls.
In July 2019, the Law Commission of Ontario (LCO) released a final report “Class Actions: Objectives, Experiences, and Reforms,” which suggested several concrete reforms to the Class Proceedings Act (CPA).
You can find ILR’s comments to the LCO report here.
The LCO report led to the adoption of the Smarter and Stronger Justice Act, 2020 on July 8, 2020. The Act amends the CPA in several important ways, including for example, stronger class certification; more efficient multi-jurisdiction case management; more safeguards regarding TPLF; and improved right of appeal for defendants.
The government has yet to announce when the class action amendments will come into force. The new rules will apply to all class actions filed from that date.
ILR Support Letter for Ontario Bill 161 2.21.2020
Canadian courts see sharp rise in class action lawsuits (Business News Network, Lisa A. Rickard)
Class Actions in Canada: A Critical Commentary (D&O Diary)