In Omarali v. Just Energy, Justice Belobaba of the Ontario Superior Court of Justice held that the court’s advanced fact-finding powers on summary judgment are limited in a class proceeding where the case management judge hears the summary judgment motion.

In that case, the defendant is an energy sales company, which sells consumer contracts for electricity and natural gas. Its sales in this space are largely conducted by door-to-door salespeople. The plaintiff alleged that the defendants’ 8,000 sales agents were misclassified as independent contractors, when they should have been classified legally as employees, and therefore entitled to the benefits and protections of the Employment Standards Act, 2000. The action was certified as a class proceeding in 2016, with two of the common issues being: 

  1. whether the class members were “employees” pursuant to the Employment Standards Act, and
  2. if yes, whether they were exempt from certain parts of the statute because they could be classified as either “outside sales agents” or “route sales persons”.

The plaintiffs brought a summary judgment motion on both common issues. The motion judge held that both issues came down to the level of “control” the defendant exercised over how the salespeople did their jobs. The parties’ evidence was, as the motion judge described it, “diametrically conflicting about the level of control”. Pursuant to Ontario’s summary judgment procedure (famously considered by the Supreme Court in Hryniak v. Mauldin), the motion judge engaged in a two-step process. First, he considered whether there was a genuine issue requiring trial on the evidence before him. He easily concluded that there was. Given that the parties’ evidence on the central issue was diametrically opposed, the motion came down to a contest of credibility. Second, he considered whether he could determine the issue without the need for a trial by using the enhanced fact-finding powers provided by the summary judgment rule. These advanced fact finding powers essentially entail holding a “mini-trial” or a trial of an issue.

The motion judge held that the number of witnesses might not make a “mini-trial” more efficient than a trial. More importantly, he held that, as the case management judge, he could not conduct a mini-trial on the two common issues before him on the summary judgment motion. He pointed to section 34(3) of Ontario’s Class Proceedings Act, 1992, which provides that the case management judge who hears the certification motion and certifies the common issues cannot preside over “the trial of the common issues” without the parties’ consent. Therefore, despite the Supreme Court’s enthusiasm in Hryniak for expeditious procedures, the motion judge dismissed the summary judgment motion and ordered that the action proceed to trial.

This decision could have a broad impact as plaintiffs and defendants try to avoid long and costly trials in class actions by bringing summary judgment motions. A party considering bringing a summary judgment motion that could require advanced fact-finding powers will want to either: (i) seek the opposing party’s consent to the having the case management judge hear a mini-trial; or (ii) ask the case management judge appoint a different judge to hear the summary judgment motion.

Author

Graham Splawski 
GSplawski@blg.com
416.367.6206

Expertise

Class Actions
Litigation and Arbitration
Energy
Electricity Markets