“A Mirage of Judicial Economy” – BCSC Applies a More Rigorous Preferability Analysis

Mr. Justice Funt has refused to certify Vaugeois v. Budget Rent-A-Car of BC Ltd., 2015 BCSC 802 on the basis of preferability.  This is a welcome result in the wake of AIC Limited v. Fischer, 2013 SCC 69 discussed in an earlier blog HERE.

In this case, the plaintiffs alleged that the defendants, Budget Rent-A-Car of B.C. Ltd. and Inland Transportation Ltd., “engaged in a systematic scheme whereby consumers renting motor vehicles from Budget’s various car rental branches [in B.C.] were improperly charged or over-charged for body and window glass repairs.”

The core of the plaintiffs’ case was an alleged “systematic scheme” by which the defendants caused renters of vehicles to be improperly charged or over-charged for repairs.  The alleged scheme involved Budget’s concealment of damage to rental vehicles on the pre-rental inspection and then improper charging of damage repair costs to the Class members despite no damage having been caused by them, based on the results of post-rental damage inspections and damage appraisals that had not in fact occurred.  The plaintiffs further alleged an internal policy that paid employees a commission based on the number of repairs found on each vehicle.

The court found that causes of action in (i) conspiracy to injure, (ii) vicarious liability, (iii) waiver of tort, (iv) unjust enrichment, and (v) for breaches of the Business Practices and Consumer Protection Act (“BPCPA”), were properly pleaded; that there was a class of two or more persons as required; and that common issues were stated.  However, the court found that the individual questions of fact would overwhelm the common issues and so a class action was not preferable in the circumstances.

The court reasoned that, assuming the systematic scheme was proved, the defendants would be entitled to show that the systematic scheme was not implemented with respect to any particular renter.  The defendants must have the ability, through cross-examination of the particular plaintiff, to challenge the plaintiff’s allegations.  In respect of each rental, the defendants may wish to test the renter’s credibility.  Furthermore, the defendants must, in each case, be entitled to show that the damage to the vehicle did occur during her rental period.  Given that each individual’s case will not depend on expert evidence or a large number of documents, Provincial Court is well suited to the resolution of these individual claims.

Mr. Justice Funt noted that, since the certification of a class proceeding in this case would only delay the inevitable need for separate liability hearings, “there would be only a mirage of judicial economy” (para. 49).  He also commented that if the alleged systematic scheme, or breaches of the BPCPA, are proven in a particular case in Provincial Court, it is likely that the case would become well known .  That and the administrative penalties provided by the BPCPA could achieve behaviour modification as effectively as a class action.

Vaugeois sets out, and follows, an approach to the preferability analysis that defendants should find encouraging.





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