Environmental Class Actions: The Importance of the Class Description
October 6, 2009
On August 26, 2009, the Québec Court of Appeal upheld the Superior Court decision denying the authorization to institute an environmental class action in the Deraspe v. Zinc Électrolytique du Canada Ltée case.1
The Court of Appeal emphasized that the group description in a proposed class action is critical, since it governs the rights and obligations of those concerned. Further, the court specified certain criteria that should be part of the description of the group in environmental class action lawsuits.
In this case, the Applicant alleged that it had been inconvenienced by a toxic gas that leaked from the plant operated by Zinc Électrolytique du Canada Ltée in Salaberry-de-Valleyfield. The event took place on August 9, 2004 when a mechanical failure that occurred at the plant caused five tons of sulfur trioxide to be released into the atmosphere. The Applicant alleged that being exposed to the toxic material released had caused eye and throat irritations, respiratory difficulties, headaches, a severe cough, asthma attacks, and other disorders.
This incident was therefore the source of a claim in non-pecuniary damages and also in punitive damages. After having amended the motion for authorization to institute a class action four times, the proposed group was described as follows:
[Translation] All persons who, on the evening of August 9, 2004,were exposed to sulfur trioxide discharged from the facilities of Zinc Électrolytique du Canada Ltée located in Salaberry-de-Valleyfield, and who consequently suffered from one or many of the typical symptoms of such exposure, including eye and throat irritations, respiratory difficulties, headaches, a severe cough, asthma attacks, or any other disorder.
At trial, the Superior Court denied the motion for authorization to institute a class action, deeming — among other things — the proposed description of the group "unsatisfactory." The court also noted that the criteria listed under paragraphs a) and b) of Section 1003 CCP had not been met.
The Court of Appeal Decision
The Court of Appeal upheld the terms of the judgment of the Superior Court, denying the authorization to institute the proposed class action and agreeing with the Superior Court’s assessment that the description of the group was "vague."
The Court of Appeal held that the description of the proposed group for the authorization of the class action is crucial, stating that it is [translation] "an essential and fundamental criteria of any class action. This description, when made official by the approval of the court, governs the rights and obligations of those concerned and they will be bound by the court decision on the merit to be rendered."2
The Court of Appeal did acknowledge that the description of the group is not always simple, and that in environmental matters this exercise can prove to be delicate. Nevertheless, the court pinpointed certain criteria that should be part of the description of a group in an environmental class action.
In this case, the Court of Appeal reviewed the description of the proposed group and essentially identified two criteria that must exist in order to be included in the class proposed by the Applicant. First, the group members must have been exposed to the discharge of sulfur trioxide that occurred on August 9, 2004 at the Respondent's facilities. Second, these members must have noticed the onset of one or many of the symptoms typical of such exposure or the onset of yet another disorder.
With respect to the first criterion, the Court of Appeal explained that it seriously lacked precision since there is the absence of a geographical boundary other than the Respondent's plant site, as well as the absence of a temporal boundary other than an undetermined time period following the incident. In the opinion of the Court of Appeal, geographic and temporal boundaries would have improved the objectivity of the first criterion to identify the members of the proposed group.
The Court of Appeal was also very strict with the second identification criterion, i.e., that a member must have suffered from the onset or aggravation of one of the symptoms therein listed, or yet another disorder, at any time following the evening of August 9, 2004. This lack of precision, the Court noted, raises major issues regarding the causal connection and makes the individual issues predominant over the common issues.
An interesting fact: on appeal, the Applicant had suggested amending the description of the group. The Court of Appeal determined that it was rarely appropriate to amend the description of the proposed group at such a late stage. Indeed, the analysis of the criteria required under Section 1003 CCP must be done in Superior Court in consideration of the description of the proposed group.
McCarthy Tétrault Notes:
The Québec Court of Appeal’s decision is interesting since it emphasizes the importance of carefully analyzing any motion for authorization to institute a class action. It underlines in this respect that the description of a proposed class must be submitted to this same careful review. An over-inclusive group or one described with lack of precision will necessarily mean that it will be difficult to determine who will be part of the class action and who will be excluded. In this decision, the Québec Court of Appeal confirms that it may no longer be appropriate to authorize class actions that clearly show a marked predominance of individual issues over common issues.
Finally, in environmental class actions, the Court of Appeal’s analysis suggests that the description of the group should include geographical and temporal boundaries. These criteria could contribute to the decrease of some of the uncertainties for both the companies faced with class actions of this nature and the individuals who could be included in the proposed class.
1 2009 QCCA 1618 ; see also Deraspe v. Zinc Électrolytique du Canada Ltée, 2008 QCCS 2338.
2 Idem, par.13.