Decertification Denied: Drawing the Line between Consumer and Business Subscribers, Once Again

Background: The Certification Saga

Wellman v. TELUS Communications Co.^[1] is an Ontario class action in which the plaintiffs allege that TELUS engaged in systematic overbilling of its mobile phone subscribers.

As this latest decision makes clear from the outset, the case has a long procedural history and has already been to the Supreme Court of Canada and back for many motions and appeals.^[2]

The common issues trial is scheduled to start in January 2026.

The action was originally certified in 2014 with a class that included both business and individual (i.e., consumer) TELUS subscribers. Their claims include breach of contract, unjust enrichment, and anti-competitive practices, and a claim under Ontario’s Consumer Protection Act in respect of the individual subscribers. The certification decision was appealed, including because the certification judge had refused to stay the action against the business customers, notwithstanding the presence of an arbitration clause in their contracts with TELUS.

After a series of appeals, the Supreme Court held in 2019 that the business customers’ claims must be stayed due to the arbitration clause in their contracts with TELUS, but the individual customer claims could proceed in court by way of class action.^[3] This left a certified class comprised of only individual subscribers.

TELUS had consistently raised concerns about the challenge of reliably distinguishing between business and individual (consumer) customers. This distinction is critical, given the following: the Ontario Consumer Protection Act^[4] prohibits mandatory arbitration in consumer agreements; TELUS’s contracts include arbitration clauses; business customers are subject to arbitration clauses and therefore cannot participate in class proceedings but must arbitrate claims instead; individual customers are not subject to arbitration clauses and therefore can participate in class proceedings.

The Latest Chapter

In its most recent motion, TELUS sought to amend the certification order to reflect the practical difficulties in distinguishing between business and consumer customers (also referred to as subscribers), and to decertify aggregate damages as a common issue. TELUS argued that since it is impossible to reliably distinguish between business and consumer subscribers, aggregate damages cannot be determined for the class. TELUS sought a stay of the class proceeding until a new litigation plan was approved.

TELUS’s position is rooted in the reality that many subscribers may use their phones for both personal and business purposes, and TELUS’s internal records may not always perfectly capture the true nature of each subscriber’s use. TELUS adduced affidavit evidence to support this position, emphasizing that individual assessments would be required to ensure that only eligible (i.e., consumer) claims proceed. This evidence complemented that of the representative plaintiff at the certification stage. He had deposed that he sometimes used his personal phone for business purposes, but could not estimate the frequency of such business use with any precision.

Decertification Denied

The Honourable Mr. Justice Morgan dismissed TELUS’s motion, finding that the evidence and arguments presented were not sufficiently new to amend the certification order.

The Court reviewed this class action’s lengthy procedural history and noted that TELUS had made similar arguments about the distinction between individual consumers and business subscribers throughout.^[5]

The Supreme Court in 2019 focused its analysis on the impact of the Ontario Arbitration Act^[6] on the business customers, leaving the consumer class members untouched by the appeal. This, Justice Morgan explained, was the result of TELUS’s concession at first instance that the Ontario Consumer Protection Act shielded the consumers from the effect of the arbitration clause.^[7] That there is indeed a distinction to be made between these two types of subscribers was taken as a given, and TELUS did not make any submissions (and the Supreme Court did not analyze) whether the consumer claims are also problematic.

Justice Morgan reasoned that the key distinction between business and consumer subscribers is not the use the person makes of their phone, but the type of contract they signed with TELUS.^[8] The relevant inquiry is whether the user was acting in a business or personal capacity at the time of the transaction, which the Court pinpointed as the time they enter into the contract with TELUS.^[9] Those who subscribed for a business phone with business name and signed a business contract are subject to an arbitration clause, and their claim is stayed pursuant to that clause regardless of whether they occasionally use the phone for personal purposes. Likewise, those who subscribe for a personal phone are shielded from mandatory arbitration and can proceed with the class action against TELUS by virtue of the Consumer Protection Act, even if they occasionally use the phone for business purposes.^[10]

Finally, the Court reaffirmed that certification is intended to be a final and efficient process, not a “fluid and flexible” one,^[11] and that parties should bring forward their best evidence at the certification stage.^[12] Here, the Court found that the new evidence that TELUS adduced on this motion added little to the record,^[13] and the Supreme Court’s 2019 ruling — while a new development that arose post-certification — is not “transformative” and does not justify amending certification.^[14]

Key Takeaways

1. Harking back to the Supreme Court’s decision in 2019, consumers’ claims cannot be stayed pursuant to an arbitration clause because they are “consumers”. In Ontario, the Consumer Protection Act invalidates arbitration clauses that prevent consumers from bringing an action in court to assert rights granted under that statute. In this decision, the Ontario Superior Court affirmed that, in deciding whether the Consumer Protection Act applies — that is, whether the transaction is entered into by a “consumer” — what matters is the type of contract entered into and not the actual use the individual makes of the service in the future. This appears to be an expansion of the scope of s. 7 of the Consumer Protection Act, beyond “the substantive and procedural rights given under this Act”. As a result, although the representative plaintiff deposed that he used his personal phone for both personal and business purposes, the entirety of his claim is nevertheless shielded from arbitration and can proceed as a class action.
2. Certification requires parties to “put their best foot forward.” Certification is meant to be final, and parties are expected to present their best evidence at certification. Attempts to revisit or supplement the record post-certification, in the absence of truly new and transformative evidence, are likely to be denied.
3. Another way to put this is that decertification is a high bar. TELUS had contended that consumer customers could not be completely distinguished from business customers, whose claims had been stayed. TELUS sought an order to “amend the certification order to provide that the question of whether a purported class member’s use of their phone meets the definition of ‘consumer’ is an individual issue and/or to amend the certification order to decertify aggregate damages as a common issue.”

Because certification motions are now such complex procedures — with all of the time, evidence and expense that complex procedures entail — in order to vary the terms of a certification order, or to decertify any common issues, the moving party has to show that new issues have arisen since certification. The new evidence must support that an amendment is needed “to respond to a change in circumstances.”^[15] In order to eliminate a certified common issue, the moving party has to demonstrate that the conditions that led to certifying that common issue are no more, not simply that they are not as strong as they once were.

^[1] Wellman v. TELUS Communications Co., 2025 ONSC 3257 [Wellman].

^[2] Wellman at para. 1.

^[3] TELUS Communications Inc. v. Wellman, 2019 SCC 19.

^[4] Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A.

^[5] Wellman at paras. 7-12 & 13ff.

^[6] Arbitration Act, 1991, S.O. 1991, c. 17.

^[7] Wellman at paras. 43-44.

^[8] Wellman at para. 56.

^[9] Wellman at para. 60.

^[10] Wellman at para. 56.

^[11] Wellman at para. 64, citing David v. Loblaw, 2024 ONSC 5818, at para. 19.

^[12] Wellman at para. 64, citing Corless v. Bell Mobility Inc., 2023 ONSC 6227, at para. 57.

^[13] Wellman at para. 69.

^[14] Wellman at paras. 69-71.

^[15] Vester v. Boston Scientific Ltd., 2020 ONSC 1308, at para. 8.