Cassels partner Jeremy Martin was cited extensively by the Supreme Court of Canada in this morning’s decision in Atlantic Lottery Corp. Inc. v. Babstock, 2020 SCC 19. The case was an appeal of a class action certification decision concerning allegations of negligence, breach of contract, waiver of tort and other wrongs in the design and regulation of video lottery terminals.
Among other things, the plaintiff class pleaded that the doctrine of “waiver of tort” – a poorly understood relic of centuries-old civil procedure – was an independent cause of action, and that it allowed them to seek disgorgement of all the defendants’ profits from their alleged wrongdoing even if the plaintiffs were unable to prove any losses on their part. Whether or not a plaintiff class can make such a claim has been a sticking-point in Canadian class actions since the case of Serhan Estate v. Johnson & Johnson in 2004.
In a groundbreaking decision for class actions across the country, the otherwise divided Court unanimously rejected waiver of tort as an independent cause of action. In doing so, the Court resolved the 16-year-old controversy that had resulted in the certification of numerous class actions that would have been unactionable but for the fact that the law was unsettled on this point.
The Court referred to Jeremy’s work at several points in its judgment: adopting his statement of the law from the 15th century to the present, as well as citing his description of the way in which the doctrine was being unfairly applied to the detriment of class action defendants.
The result of this decision will be immediate. The scale of potential liability in class actions across the country claiming waiver of tort will be cut down – in some cases dramatically – and some cases targeting the profits of the defendant rather than compensation for damages may be dismissed outright.
For more information, or to inquire as to the effect of this decision on your own case involving waiver of tort, please contact Jeremy Martin.