AIC Limited, et al. v. Dennis Fischer, et al.

(Ontario) (Civil) (By Leave)


Civil procedure - Class actions, Certification.


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Civil procedure Class actions Certification Preferable procedure Whether the Court of Appeal erred by overturning the motion judge because he did not focus on what would have been the remedial powers of the Ontario Securities Commission in a contested case, or because he did not focus on the extent to which the Commission proceeding offered court like procedural protections or because of his reliance on class settlement approval criteria Whether the Court of Appeal erred by not considering the established procedural features which the motion judge took into account, such as the no fault, timely, no cost aspects of the Commission proceeding and that that proceeding addresses the same harm as that alleged in the class proceeding and provides the same form of remedy Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 5(1)(d).

The appellants are mutual fund managers who were the subject of an investigation conducted by the Ontario Securities Commission into “market timing”, a practice which was alleged to have caused long term investors to suffer losses in the value of their investments. The fund managers ultimately entered into settlement agreements with the Commission, the terms of which required them to pay over two hundred million dollars to investors, including the respondents. Following the settlement agreements, the respondents brought a motion for certification of a class action against the fund managers for the same market timing conduct. The motion judge concluded that although the action otherwise satisfied the criteria for certification, it did not satisfy the preferable procedure requirement. The Divisional Court disagreed, concluding that the Commission proceedings could not be the preferable procedure for recovering damages because the investors’ action was for significant monetary damages beyond the amount recovered through the settlement agreements. The Court of Appeal dismissed the appeal.