Class proceeding by franchisees

A franchisee meets this term when several franchisees of one system share a complaint, such as a fee or a rebate, and consider suing together. In Ontario, s. 2(1) of the Class Proceedings Act, 1992 says one or more members of a class of persons may commence a proceeding in the court on behalf of the members of the class. British Columbia’s Class Proceedings Act says a resident of British Columbia who is a member of a class of persons may do the same.

Certification

Under each Act, the person who commences the proceeding must seek an order certifying it as a class proceeding. In Ontario, s. 5(1) says the court shall, subject to subsection (6) and to section 5.1, certify if the listed requirements are met, including an identifiable class and that a class proceeding would be the preferable procedure for the resolution of the common issues; on a plaintiff’s motion, s. 5(1.1) sets minimum conditions for that preferable-procedure test, and s. 5(2) adds requirements where a subclass needs separate representation. British Columbia’s Act says the court must certify, subject to its subsections (3) and (4), if all listed requirements are met, including that the pleadings disclose a cause of action. This entry covers Ontario and British Columbia; check the rules where you are.

What to ask

• What claim would the franchisees share, and what common issues does it raise?
• Which province’s Act and court would apply?
• Does the franchise agreement say anything about how disputes are decided?