CLASS ACTIONS IN QUEBEC RATIONE MATERIAE JURISDICTION: A PRELIMINARY ISSUE

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1 CLASS ACTIONS IN QUEBEC RATIONE MATERIAE JURISDICTION: A PRELIMINARY ISSUE By Catherine Piché Fasken Matineau DuMoulin LLP Stock Exchange Tower Suite 3400, P.O. Box Square Victoria Montreal, Quebec H4Z 1E9 cpiche@mtl.fasken.com Montreal, March 16, 2005

2 - 2 - CLASS ACTIONS IN QUEBEC RATIONE MATERIAE JURISDICTION: A PRELIMINARY ISSUE On December 14, 2004 in Quebec (Attorney General) v. Charest, 1 the Court of Appeal of Québec dismissed a class action instituted by surviving same-sex spouses who were deprived of benefits, annuities or advantages, on the grounds that the dispute fell under the exclusive jurisdiction of specialized Quebec tribunals and agencies, not the Superior Court of Québec. This upholds the court s earlier position in Société Asbestos Ltée v. Charles Lacroix and Régie des rentes du Québec and Compagnie d Assurance Tender Life 2 respecting the legal controversy of when to plead lack of jurisdiction ratione material in a class action suit. The Facts In Charest, the applicant sought the status of representative for a group of natural persons that included: [TRANSLATION] anyone who, having been the spouse of a person of the same sex deceased between June 28, 1976 and June 16, 1999, was deprived of benefits, annuities or advantages granted to surviving spouses of the opposite sex under any of the following Quebec laws: Workmen s Compensation Act; 3 Act respecting industrial accidents and occupational diseases; 4 Automobile Insurance Act; 5 Act respecting the Quebec pension plan; 6 ( ). The motion for authorization to institute a class action was filed against the Attorney General of Québec, the Quebec Pension Board, the Commission administrative des régimes de retraite et d assurance, the Commission de la santé et de la sécurité du travail du Québec and the Société de l assurance-automobile du Québec. Mr. Charest, who had lived in a marital relationship with Mr. Robert Caisse from 1976 until his death on April 22, 1990, instituted proceedings when he was refused annuities as a surviving spouse. Indeed, prior to June 16, 1999, several laws failed to recognize surviving same-sex spouses. According to Mr. Charest, these laws perpetuate discrimination based on sexual orientation and therefore violate the Charter of Human Rights and Freedoms 7 and the Canadian Charter of Rights and Freedoms. 8 For all intents and purposes, even though the law was amended after 1999 to end this type of discrimination, agencies and the government still refused to pay benefits for deaths that occurred prior to In the initial motion for authorization, the main conclusion sought was to: [TRANSLATION] allow each member of the group to avail themselves of the benefits, annuities or advantages granted to surviving spouses under every piece of legislation at issue by following the procedures and formalities prescribed therein, and this within a period of one year as of the date of the final decision handed down in this case. Exemplary damages were also sought REJB (C.A.) (jj. Rochon and Hilton) (hereinafter Charest ). J.E (C.A.) (jj. Mailhot, Morissette and Lemelin (ad hoc)) (hereinafter Société Asbestos ). R.S.Q., c. A-3. R.S.Q., c. A R.S.Q., c. A-25. R.S.Q., c. R-9. R.S.Q., c. C-12. R.S.C. 1985, App. II, No. 44, being Schedule B, Part I.

3 - 3 - Motions for Declinatory Exception The respondents in Charest filed five motions for declinatory exception on the grounds that the Superior Court lacked jurisdiction to decide the dispute. The appellants alleged that: (i) the essence of the dispute was to obtain benefits, annuities and advantages granted under the various laws at issue and; (ii) these requests should be referred to the specialized courts to which legislation had granted exclusive jurisdiction. The Superior Court justice first apprised of these motions for declinatory exceptions deemed them premature, and referred them to the judge who would ultimately be appointed to hear the merits of the case. Société Asbestos and Ratione Materiae Jurisdiction Meanwhile, the Court of Appeal settled a legal dispute on this very subject in Société Asbestos. The court ruled that, barring exceptional circumstances, a Superior Court justice hearing a motion for declinatory exception claiming the lack of ratione materiae jurisdiction must rule on the objection to jurisdiction before handing down a decision authorizing the institution of a class action. Until recently, case law in Quebec was split on when lack of ratione materiae jurisdiction should be raised in a class action. One branch of jurisprudence tended to defer this issue to a subsequent stage because a class action does not yet exist at the authorization stage. 9 In Société Asbestos, the Court of Appeal refused to subscribe to this line of thinking, preferring to distinguish or categorize the various types of preliminary arguments raised by the parties. The Court of Appeal explained that, in the case of declinatory exceptions rationae loci, case law is quite rightly unanimous on deferring that issue to the judge who will be deciding on the authorization. 10 However, in the case of motions for declinatory exception ratione materiae or on the basis of lis pendens, the Court of Appeal cited three cases where its jurisdiction was decided prior to authorization, and two others where judges deferred the motion to the authorization stage. In paragraphs 21 and 22 of its decision, the Court of Appeal had this to say on the issue: [TRANSLATION] [21] There can be no deviating from jurisdiction rules enacted in the Code of Civil Procedure, because they are notions of public policy. It is in the interests of the proper administration of justice that the lack of ratione materiae jurisdiction be raised as early on as possible. Courts have often emphasized the importance of pleading lack of ratione materiae jurisdiction to prevent cases from winding up before the wrong courts. This Court has established that lack of ratione materiae jurisdiction can be raised at all stages of a case, even on appeal. I see nothing here that prevents the application of the rules 9 10 See: Regroupement des citoyens contre la pollution et al. v. Alex Couture Inc. et al., REJB (S.C.). Option Consommateurs v. Servier Canada Inc., [2003] R.J.Q. 470 (S.C.).

4 - 4 - respecting the ratione materiae jurisdiction of courts at the motion for authorization stage. [22] When legislators use the terms court and judgment in articles of the Code of Civil Procedure, they necessarily mean a court of competent jurisdiction. As ratione materiae jurisdiction is a notion of public policy, a court that does not have the necessary jurisdiction cannot pronounce itself on how a class action should proceed. Deferring issues of ratione materiae jurisdiction to the stage following the motion for authorization could lead to absurd situations. ( ) Moreover, in Société Asbestos, the Court of Appeal specified that a judge hearing a motion for lack of ratione materiae jurisdiction might exceptionally be unable to rule thereon at that stage of the proceeding due to, say, the complexity of the evidence needed to resolve the issue. Under such exceptional circumstances, these motions can be referred to the judge charged with hearing the motion for authorization. For these reasons, the court ruled in Société Asbestos that it is not premature to raise a motion for declinatory exception ratione materiae before the authorization to institute a class action has been ruled upon. Ratione Materiae Jurisdiction, a Preliminary Argument Based on the court s reasoning in Société Asbestos, the Court of Appeal chose to dispose of the motions for declinatory exception ratione materiae in Charest before ruling on the authorization. It concluded that the Superior Court had no jurisdiction to rule on the dispute, the legislators having explicitly provided in various legislation that it is administrative agencies and, in some cases, the Administrative Tribunal of Québec, arbitration tribunals and even the Commission des lésions professionnelles, that are entrusted with the duty of resolving disputes. In fact, the court added that various review tribunals have the authority to rule on any issue of law or fact necessary to the exercise of their jurisdiction and have all powers to resolve any issue relating to the Charter of Human Rights and Freedoms and the Canadian Charter of Rights and Freedoms. For all these reasons, the Court of Appeal allowed the appeal, and dismissed the motion for authorization to institute a class action filed by respondent Charest. We have also learned that the applicant is now considering the possibility of appealing the case before the Supreme Court of Canada Besides, it is important to note that, on November 26, 2004, the Court of Appeal of Ontario ruled in favour of a similar class action relating to same-sex couple rights in respect of the federal pension plan. In that case, the Court of Appeal of Ontario ruled that gays and lesbians in the province of Ontario are entitled to benefits given to surviving spouses under the Canada Pension Plan, and this since April 17, 1985, namely the day on which the Canada Charter of Rights and Freedoms came into force. See: Hislop v. Canada (Attorney General), [2004] O.J. No Also, the institution of a similar class action was authorized in July 2002 by the Supreme Court of British Columbia: Brogaard v. Canada, [2002] B.C.J. No However, the Court of Queen s Bench of Saskatchewan refused to certify a similar class action filed in Saskatchewan on February 4, 2003: Daniels v. Canada, [2003] S.J. No. 73.

5 - 5 - In the meantime, as long as class action suits require their applicants to request an authorization to plead on behalf of another without a power of attorney, an exception to the fundamental principle laid out in article 59 of the Code of Civil Procedure, and that this type of recourse constitutes a series of individual recourses that must exist in law, determining which court has jurisdiction will remain a crucial issue that must be decided as early on as possible. These cases are important food for thought when considering alternative preliminary arguments, especially motions for declinatory exception for lack of territorial jurisdiction.

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