You’ve been served! Or have you? The Importance of Proper Service in Class Action Proceedings

Authors: Robert Leurer, Q.C., Adryan Toth

In a class action, does the plaintiff need to provide proof of proper service on every defendant before being able to get a case management judge designated?

This seemingly mundane question has assumed considerable importance because some plaintiffs’ firms have employed the tactic of attempting to avoid difficulties inherent in international service by only serving Canadian or American entities prior to prosecuting the matter further.

This was the main issue recently considered by the Saskatchewan Court of Appeal in Bulmer v Nissan Motor co., Ltd., 2017 SKCA 19 [Bulmer]. The case stands to have important practical implications for the administration of class actions in Saskatchewan. In particular it allows foreign defendants sued in Saskatchewan Courts to expect that the rules of private international law will be followed and respected so that they will be properly summoned to appear the Saskatchewan courts.

In the lower court, the Plaintiff applied to the Chief Justice of the Court of Queen’s Bench for the designation of a case management judge. This is an important initial procedural step, which allows class actions to be properly prosecuted.

In Bulmer, the Plaintiff provided evidence of proper service upon the two named North American defendants, but had only effected purported service by delivery of the Statement of Claim on a Japanese defendant via commercial courier. The laws of Japan, however, do not recognize as effective service delivery of a document commencing a legal proceeding via commercial courier or registered mail.

In first instance, the Chief Justice of the Court of Queen’s Bench reviewed the applicable Queen’s Bench Rules and the applicable international treaty (the Hague Service Convention) and held that even if a commercial courier could be equated with registered mail, this method of delivery was not valid service. Instead, the Plaintiff needed to effect service in accordance with a process prescribed in the Hague Service Convention, namely through state central authorities. Since the Plaintiff failed to do this, the Chief Justice refused to designate a judge, and the case could not move ahead.

The Plaintiff appealed to the Court of Appeal for Saskatchewan, arguing that the Chief Justice did not have the authority to impose conditions on the designation of a case management judge, and that in any event service was effective. The Court of Appeal unanimously dismissed the appeal.

The Court of Appeal affirmed that the Chief Justice of the Court of Queen’s Bench has the authority to impose reasonable conditions on the appointment of a case management judge, including a requirement that the plaintiff first prove that every defendant has been properly served. This is an important prerequisite as it makes sure that the plaintiff cannot prosecute the class action without first bringing every defendant forward to answer to the allegations.

The Court of Appeal also gave important guidance on the need to respect rules of service, particularly in regards to the service of foreign entities when treaties exist. The Court held that it was not appropriate for a plaintiff to simply send a copy of a Statement of Claim by registered mail, at least where the laws of the foreign jurisdiction attach more formality to service. Instead, a plaintiff in such circumstances must serve through the central authority provisions of the Hague Service Convention, which have been incorporated into the Saskatchewan rules of civil procedure.

Class actions are complex proceedings that require case management. The Saskatchewan courts recognize that case management is only proper once all defendants are properly before the courts.

It is now without controversy that a plaintiff must be careful to properly serve every named defendant in a class action in accordance with the Rules and/or applicable international treaties. A failure to do so will result in the class action being stalled.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.