Ontario court decertifies class action because representative plaintiff’s post-certification conduct showed he was unsuitable

Can a class action continue if the only available representative plaintiff is not suitable for the role? In Azar v. Strada Crush Limited, Justice Morgan answered “no” to that question. After finding that the representative had preferred his own interests over the interests of class members, Justice Morgan removed the representative plaintiff and ultimately decertified the class action after class counsel failed to find a replacement. The case highlights the importance of the “adequacy” of the class representative in the context of class actions.  

Background: Employee misclassification class action

George Azar commenced a class action alleging that the defendant had misclassified certain employees and deprived them of overtime and holiday pay. On August 17, 2018, Justice Morgan certified the class action with Mr. Azar as the representative plaintiff.

Litigation history: Falling out and rapprochement between class counsel and representative plaintiff

About a year after certification, Mr. Azar asked Justice Morgan to replace class counsel and filed an affidavit making serious and far reaching allegations against class counsel. Justice Morgan found the allegations were unfounded. He also found that Mr. Azar had acted out of a personal interest rather than in the interest of the class and so removed him as representative plaintiff.

Class counsel could not find anyone to take Mr. Azar’s place. However, Mr. Azar and class counsel reconciled and asked Justice Morgan to reappoint Mr. Azar. Mr. Azar swore another affidavit in support of that request which was equally inflammatory but irreconcilable with his earlier affidavit. The defendant argued that Mr. Azar remained unsuitable for the role and asked Justice Morgan to decertify the class action instead.

Court decision: Class action decertified because of representative plaintiff’s self-interested flipflopping

Justice Morgan found that Mr. Azar was not a suitable representative plaintiff, noting that he had changed his position radically and erratically from one piece of sworn testimony to another and had demonstrated that he was not capable of effectively leading the class. Justice Morgan also found that Mr. Azar had shown a distinct tendency to focus on himself rather than on the interests of the class.

Class counsel argued that Mr. Azar should be reappointed because it was necessary to ensure access to justice for the entire class. While acknowledging that concern, Justice Morgan found that appointing a representative plaintiff not up to the task did not foster access to justice. He added that an appropriate representative plaintiff was a necessary statutory condition for a certified class action. As that requirement was no longer satisfied, Justice Morgan decertified the class action.

Conclusion

Although class actions are often seen as counsel-driven, Azar reinforces the importance of representative plaintiffs. Class proceedings legislation across Canada mandates that every class action must be helmed by an appropriate representative plaintiff. The Azar ruling confirms that a representative plaintiff’s conduct, both pre- and post-certification, can sound the death knell for a class action.

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Editors

Deborah Glendinning

Partner, Litigation

Sonia Bjorkquist

Partner, National Chair, Litigation

Éric Préfontaine

Partner, Litigation

Christopher Naudie

Partner, Litigation

Craig Lockwood

Partner, Litigation

Tristram Mallett

Partner, Litigation

Karin Sachar

Partner, Litigation