Date: 20030221
Docket: T-757-02
Neutral Citation No.: 2003 FCT 212
BETWEEN:
ALWAYS TRAVEL INC. and
HIGHBOURNE ENTERPRISES INC. and
CANADIAN STANDARD TRAVEL AGENT REGISTRY (CSTAR)
Plaintiffs
- and -
AIR CANADA, AMERICAN AIRLINES INC.,
UNITED AIRLINES INC., DELTA AIRLINES INC.,
CONTINENTAL AIRLINES INC., NORTHWEST AIRLINES INC.,
and INTERNATIONAL AIR TRANSPORT ASSOCIATION (IATA)
Defendants
(Delivered from the Bench in Ottawa, Ontario
on Thursday, February 20, 2003)
[1] This is a proposed class action proceeding in which I have been appointed as case management judge. At a first case management conference held on November 26, 2002, I heard all counsel and then I gave an order directing first, that the plaintiffs had leave to file an amended statement of claim, and second, that the defendants should file all their preliminary motions by January 13, 2003 including a motion to extend the time for the filing of the statements of defence. The actual terms of the relevant parts of that order are as follows:
1. Plaintiffs are to serve and file an amended statement of claim no later than December 6, 2002.
2. All preliminary motions by defendants are to be served and filed by January 13, 2003, including the motion for extension of time to file their defence.
[...]
5. The hearing of these motions will take place in Ottawa on February 20, 21, 2003 starting at 9:30 a.m.
[2] On December 6, 2003 the plaintiffs duly filed their amended statement of claim. The present motion which was made in accordance with my order is to extend the time for filing the statements of defence until after judgment on the issue of certification of the class action. It is the only preliminary motion made by the defendants pursuant to the cited order which in my view means that the defendants are now foreclosed from bringing any other preliminary motions.
[3] I think it best if I set out the principles upon which I should act to determine the issue presently before me, namely, whether the defendants may have until after the determination of the issue of certification to file their statements of defence to the action.
[4] First, there is and can be, in my view, no question whatever of my authority as a matter of the exercise of judicial discretion and as the appointed case management judge in this matter to grant the relief requested. If a specific text is needed, Rule 385 gives that text.
[5] Two, while as I have just said, the defendants are now in my view foreclosed from bringing any further preliminary motions, and therefore may not now move to strike all or any part of the amended statement of claim, they may still argue on the return of the motion for certification that no cause of action is shown or that some of the alleged causes of action are not proper causes of action. I think that avenue is still open to them.
[6] Three, in my view, not only is a statement of defence not essential to a determination of the issues which will have to be determined on the certification motion, it is very unlikely to be of any assistance whatever to the Court at that stage. As I read Rule 299.18, it defines and limits the questions to which the Court must respond on the certification motion and those questions can be answered solely by reference to the statement of claim and do not require that there be a statement of defence.
[7] Four, the defendants, in support of their motion, cite and rely on a number of cases from other jurisdictions, notably, the cases of Mangan v. Inco Limited (1996), 30 D.R. (3d) 90 (Gen. Div.) and Monsanto Canada Inc. v. Hoffman 2002 SKCA 120, in which other courts have granted motions similar to this one. However, I do not understand those cases to lay down any principle that motions of this sort in proposed class action proceedings should be granted as of course. Indeed, in my view, any such principle would run diametrically contrary to the principle first stated above, namely, that the question of the extension of time to file a statement of defence is quintessentially a matter for the exercise of judicial discretion.
[8] Fifth, in my view, the defendants, as the moving party on this motion, have the burden of persuading me that I should grant the relief sought. In this connection, the absence of any evidence in this record by way of affidavit or otherwise, is a serious draw back for I am left to reach the decision solely on the basis of the pleadings.
[9] Sixth, however, while I view that defect as serious, I do not think it to be fatal, I think that in the circumstances of this case, I can reach a proper decision on a simple reading of the amended statement of claim. I emphasize, however, once again, that this is not a matter of course and at least in this Court, I think defendants who move for relief of this sort would be well advised to accompany their motion with material indicating in what way the relief sought would advance the purposes of the rules, namely, the most just, most efficient and least costly resolution of the litigation. But this action, which is the one I have to deal with, is of very considerable complexity, and that complexity is such as to make it unlikely in the extreme that requiring a statement of defence at this stage of the proceeding would lead to a less costly and more speedy resolution of the action.
[10] There are 3 plaintiffs and 7 named defendants, 6 of them being airlines, most of whom are members of alliances or groupings of airlines which include other carriers. The seventh defendant is International Air Transport Association, an international association representing, amongst other things, airlines.
[11] According to the amended statement of claim, the number of members of the proposed class being travel agents who have issued tickets or similar documentation for the defendant airlines in Canada is approximately 3,700. The amended statement of claim sets out 13 proposed common issues of law or of fact. It also alleges the existence of at least 2 co-conspirators who are not named as parties. The causes of action alleged are, very briefly stated : conspiracy, breach of trust, breach of statutory duty and others.
[12] If I were to require now that statements of defence be produced within the usual time or some reasonable extension of time, the logical next steps would be documentary production and discoveries. This, in an action in which certification has not yet been granted and where it is uncertain whether or not the action will go forward as a class action or at all. It is, in my view, uncommonly burdensome for both plaintiffs and defendants to undertake that kind of work, documentary production and discoveries, without any assurance that it would produce any benefit for anybody in the event that the action is not certified or is only partly certified.
[13] Therefore, in my view, it is appropriate in these circumstances, but not, I repeat again, as a matter of course, to grant the defendants until 30 days following the judgment of this Court on the plaintiffs' application for certification to file their statements of defence. That time may, of course, be spoken to in due course.
[14] There will be no order for costs on this motion.
Judge
Ottawa, Ontario
February 21, 2003
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF SOLICITORS AND SOLICITORS ON THE RECORD
COURT FILE NO.: T-757-02
STYLE OF CAUSE: ALWAYS TRAVEL INC. ET AL v. AIR CANADA ET AL
DATE OF HEARING: February 20, 2003
PLACE OF HEARING: Ottawa, Ontario
REASONS FOR ORDER OF THE HONOURABLE MR. JUSTICE HUGESSEN
DATED: February 21, 2003
APPEARANCES:
Gilles Gareau and John Legge FOR PLAINTIFFS
Michael Phelan FOR DEFENDANT Continental Airlines Inc.
Sylvain Deslauriers FOR DEFENDANT American Airlines Inc.
Kent Thomson and Matthew Milne-Smith FOR DEFENDANT Delta Airlines Inc.
Katherine Kay FOR DEFENDANT Air Canada
Michael Penny FOR DEFENDANT United Airlines Inc.
David Kent FOR DEFENDANT Northwest Airlines Inc.
Stanley Wong FOR DEFENDANT International Air Transport Association
SOLICITORS ON THE RECORD:
Lauzon Bélanger
Montréal, Québec FOR PLAINTIFFS
Ogilvy Renault
Ottawa, Ontario FOR DEFENDANT Continental Airlines Inc.
McCarthy Tétrault
Montréal, Québec FOR DEFENDANT American Airlines Inc.
Davies Ward Phillips & Vineberg
Toronto, Ontario FOR DEFENDANT Delta Airlines Inc.
Stikeman Elliott
Toronto, Ontario FOR DEFENDANT Air Canada
Torys
Toronto, Ontario FOR DEFENDANT United Airlines Inc.
McMillan Binch
Toronto, Ontario FOR DEFENDANT Northwest Airlines Inc.
Davis & Company FOR DEFENDANT International Air Transport Association