The Conduct of an Appeal Blog

Court of Appeal addresses novel question of appellate jurisdiction in class proceedings

Oct 14, 2021 6 MIN READ
W. David Rankin

Partner, Disputes, Toronto

The Court of Appeal for Ontario recently addressed a novel question of appellate jurisdiction: is an order refusing to extend the time to opt out of a class action final or interlocutory? If final, the appeal lies to the Court of Appeal under s. 6(1)(b) of the Courts of Justice Act. If interlocutory, the appeal lies only in the Divisional Court with leave. Justice Lauwers answered this question in Johnson v. Ontario2021 ONCA 650: the order is final and appealable as of right in the Court of Appeal.

The final-interlocutory distinction continues to be challenging, particularly in novel areas. Lord Denning M.R. once wrote (before England dropped the distinction) that the “question of ‘final’ or ‘interlocutory’ is so uncertain, that the only thing for practitioners to do is to look up the practice books and see what has been decided on the point” (Salter Rex & Co. v. Ghosh, [1971] 2 All E.R. 865 (C.A.)). Where the practice books are silent, as in Johnson, resort must be to first principles.

Background of Johnson

Johnson involved a certified class proceeding on behalf of persons incarcerated at Elgin Middlesex Detention Centre, a prison run by the defendant Her Majesty the Queen in Right of Ontario.  Unaware of the class action, a former inmate commenced an overlapping action seeking damages for injuries suffered as a result of delayed medical treatment while incarcerated. By the time the former inmate commenced his individual action, the deadline to opt out of the class proceeding had already expired. Notice of the class proceeding did not reach the former inmate, as the notice was sent to the apartment he had shared with his father prior to his arrest, rather than to the institution where he was incarcerated when the notices were circulated.

The Province asked the former inmate to discontinue his personal litigation, or to limit his claims so as not to overlap with the certified class proceeding. The former inmate did neither and instead sought an extension of time to opt out of the class proceeding. The motion judge refused this relief.

First principles

Is refusing to extend the time to opt out of a class proceeding final or interlocutory? On one hand, the order appears interlocutory as it does not determine the real matter in dispute between the parties. On the other hand, the order appears final as it effectively terminated the former inmate’s personal litigation (as he could not proceed both as a class member and as an individual plaintiff). The result is a rare case where the Court of Appeal was required to go deeper into first principles.

Justice Lauwers’ reasons feature the following first principles of appellate jurisdiction:

  1. The distinction between final and interlocutory orders reflects the proportionality principle. Interlocutory decisions are comparatively less important to the parties and the public, and thus the Courts of Justice Act places limits on the right of appeal (e.g., a leave requirement).
  2. Interlocutory decisions are those which do not “determine the real matter in dispute between the parties—the very subject matter of the litigation, but only some matter collateral … [I]t is interlocutory if the merits of the case remain to be determined” (from the leading Ontario decision, Hendrickson v. Kallio, [1932] 4 D.L.R. 580 (Ont. C.A.)).
  3. The “real matter in dispute between the parties” refers to the specific proceeding that is actually before the court, not some other proceeding which may or may not be in existence.
  4. Generally, an order addressing procedural rights will be interlocutory, as final orders deal with substantive merits. However, there are important qualifications to this distinction. Where the “real matter in dispute” is itself procedural, the resolution may be a final order.
  5. Applying these principles, orders determining the forum for litigation are generally final. For example, an order staying a court action in favour of arbitration is considered to be final. Such an order terminates the proceeding that is actually before the court, even though it does not determine the substantive merits of the underlying dispute between the parties.

These are the first principles applicable in Johnson. There are others, as Ontario jurisprudence has built up over the decades with numerous rules and exceptions. Lord Denning’s advice remains applicable: “the only thing for practitioners to do is to look up the practice books and see what has been decided on the point”. For example, there is an extensive discussion of the applicable principles and decided cases in John Sopinka, Mark A. Gelowitz & W. David Rankin, Sopinka and Gelowitz on the Conduct of an Appeal, 4th ed. (Toronto: LexisNexis, 2018), at §§1.16 to 1.77.

Application: Final order

The Court of Appeal concluded based on first principles that the order refusing to extend the time to opt out of the class proceeding was final. The appeal was thus properly taken in the Court of Appeal. In reaching this conclusion, Justice Lauwers considered the subject matter of the appeal:

  1. Although the Class Proceedings Act is procedural, the opt-out right can be characterized in substantive terms. The right to opt out is “fundamental to the court’s jurisdiction over unnamed class members”, given that “society places a high premium on a person’s ability to initiate and participate in litigation as an incident of personal autonomy” (paras. 15-16).
  2. Procedural and substantive rights are symbiotic and not always possible to distinguish. Here, the former inmate “lost substantive rights of significant importance when his motion for an extension of time within which to opt out of the class action was denied” (para. 26).
  3. Had Ontario moved for a permanent stay of the former inmate’s personal litigation, there is no doubt that the motion judge’s decision would be final (para. 23). The fact that the issue was decided in the context of an opt-out motion in the class proceeding should not change the appeal route.

Justice Lauwers also addressed the class action context. The advantages of a class proceeding are “realized for litigants with relatively modest claims who are prepared both to be patient during the long and involved class action process and also to sacrifice a good deal of their potential recovery to finance the legal costs” (para. 25). This does not apply to the former inmate in question, as he advanced a claim for significant damages. These considerations will likely resurface on the appeal.

In the meantime, Johnson is one more case for the practice books characterizing a type of order as final for purposes of appellate jurisdiction. The keepers of those books will take note.

* This post was originally published by the OBA Class Actions Section Newsletter on October 6, 2021.