As a Canadian, you have likely encountered news articles or other social media posts notifying you about ongoing or settled class actions. In recent years, you may have noticed that many of these class actions were commenced in British Columbia (BC).  As a resident of British Columbia, you may be wondering how participating in a class action affects your legal rights and obligations. This blog post provides an overview of  class action participation in British Columbia, including how class actions work, who is included, and what to consider when deciding whether to participate. 

What is a class action? 

A class action is a lawsuit brought on behalf of a group of similarly situated individuals who share common issues, such as harm caused by the same product, practice, or event. One or more of such persons within the group acts as the “representative plaintiff” to represent the interests of the class. There might be a group of defendants or only a single defendant. A class action allows the individuals within the class to pursue their interests as one, rather than commencing numerous separate actions. 

How are class actions certified in British Columbia?

To become a class action, the action must be “certified” by the court. This means that the court must decide, through a motion for certification, that the action can proceed as a class action. During the certification motion, the court considers whether:

There is an identifiable class of two or more persons.

The claims raise common issues.

A class action is the preferable procedure for resolving those issues.

There is a suitable representative plaintiff.

Generally, the parties will put forward expert reports, written materials, and affidavit evidence to assist the court in completing their assessment.   

If the action is certified, any settlements or court orders will apply to all members of the class unless the putative class member opts-out. This means that your rights may be affected even if you do nothing.

Jurisdiction of class actions in Canada

Each province has its own superior court and its own class proceedings legislation. These laws govern how class actions are commenced, certified, and managed within each province. In addition, Canada has a Federal Court which may consider class proceedings which fall within its limited jurisdiction, such as matters involving federal statutes, immigration, or intellectual property.  A class action filed within one province is not necessarily limited to those who reside within that province. A class action may be brought on behalf of a national class, meaning that the class includes Canadian residents across the country. However, non-residents may be required to opt in or out to participate in the action, depending on the jurisdiction. If you are unsure of whether a class action applies to you (i.e., whether you are a member of the class), you should consult class counsel or check the class definition.  

 The location of where a class action is commenced may be affected by several factors, including applicable legislation and location of the affected class members. 

What are the benefits of a class action lawsuit?

Class actions allow for many benefits. for both individuals and the Canadian legal system, including:

Time savings

Class actions may include hundreds or thousands of individuals. Pursuing one action, rather than hundreds or thousands of individual actions, helps maximize limited court resources and streamline the legal process. This not only saves time for plaintiffs but also reduces the burden on the courts, making litigation more efficient for everyone involved.

Shared legal costs

Litigation is expensive. In a class action, the costs and risks of litigation are shared amongst the group of individuals. Depending on the action, the potential for individual recovery may not be significant enough to justify the cost of litigation. Consider an action affecting many people, but where the alleged harm relates to relatively small damages. It is unlikely that all of the affected individuals would willingly take on the expense and risk of pursuing litigation and retaining experts for the purposes of rendering an opinion for the courts. A class action provides the potential opportunity for meaningful recovery of the alleged harms for many, if not all, of the affected individuals. Companies or organizations may recognize the improbability that all harmed individuals would pursue litigation for relatively modest recovery.

Deters companies from wrongdoing

Class actions can deter companies and institutions from engaging in negligent or actionable conduct. When companies know that their actions could lead to a large-scale class action lawsuit, they may be more likely to follow regulations, enforce ethical practices, and avoid negligence. This helps protect consumers, employees, and other affected parties from harm.

Consistency in court decisions

The commencement of multiple individual actions can also increase the possibility of conflicting results. In a class action, the decisions of the courts or potential resolution scheme apply to all the members of the class, unless they have opted out. This increases the likelihood for consistency. 

How does the opt-out system work for class actions in British Columbia?

In British Columbia, class proceedings are governed by the Class Proceedings Act, RSBC 1996, c 50 (“BC CPA”). The BC CPA provides for an opt-out regime for class actions. This means that both residents and non-residents of the province are automatically part of the class, assuming all other requisite provisions within the class definition are satisfied. If an individual who would otherwise be a member of the class wishes to not be a part of the class, they must formally opt out. If a person does not opt out, they will be bound by any settlement or court award achieved in the class action. They will not be permitted to pursue their claim as an individual action. It is important to understand that inclusion in a class action does not automatically guarantee compensation. Class members are typically required to submit a claim form and provide proof of eligibility to receive any portion of the settlement or court-awarded damages. This process ensures that compensation is distributed fairly among eligible members.

Reasons why you might choose to opt out of a class action

There are various reasons a person may choose to opt out of a class action. For example, a person may choose to opt out of a class action if their individual damages are significantly larger than others within the class, if they wish to have more direct involvement in the litigation than a class member would typically have, or if they disagree with a proposed settlement. By opting out, individuals reserve the right to pursue an independent lawsuit.

Risks to consider before opting out

Before opting out to pursue an individual action in British Columbia, it is crucial to consider your potential risk. Individual litigation may expose a person to significant costs, including the expense of retaining experts, or being court-ordered to pay a portion of the winning party’s legal expenses, should the individual lose at trial. In opting out, a person foregoes the opportunity to participate in a negotiated settlement or court award within the class proceeding. Even if a class action results in a settlement or compensation for the class members, there are no guarantees that an individual action relating to similar issues will result in successful resolution. There are similarly no guarantees that, should the individual action resolve or succeed at trial, the action will result in the individual being awarded an amount equal to or greater than that achieved within the class. This uncertainty highlights why it is critical to weigh the potential benefits of opting out against the risks and costs of individual litigation.

Why it’s crucial to stay informed about class actions

It’s important to stay informed about class actions which may affect your rights. Following certification, a notice identifying the certified class and the common issues will be published.  The notice of certification will also advise of the right to opt out. The notice will include a deadline by which the class member must opt out, along with the steps required to do so. If you miss the deadline by which to opt out, you automatically remain a member of the class, bound by the outcome within the class proceeding. If you are considering opting out of a class action, you should consult an experienced class action lawyer. 

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