B.C. court rejects ‘unusual’ class action shift

Those allegations have not been proven.

In 2022 the B.C. Supreme Court declined to certify the proceeding as a class action, ruling that MM Fund didn’t have standing to bring a class action in B.C. as it was not a resident of the province. The court ordered the fund to remove the class action claims from its pleadings.

After an appeal of that decision was dismissed by the B.C. Court of Appeal on April 30, the fund filed a proposed class action in Ontario, repeating the allegations from its original lawsuit in B.C.

It then sought an order from the court in B.C. to transfer that litigation to Ontario.

“MM seeks this relief because it wishes to continue this action in Ontario in conjunction with [the] recent class action filed there,” the B.C. court noted in its decision.

The court rejected the fund’s request, which it characterized as “very unusual” coming from the plaintiff in a case. Requests to change jurisdiction typically come from defendants, it noted.

“Counsel advise that they have been unable to find any decision where a plaintiff, such as MM, having chosen B.C. as the forum to conduct this litigation, later decides that it wishes that the matter proceed in another court,” the court said. It added that the unprecedented nature of the request is heightened by the fact that MM has already argued that the case belongs in B.C. because Excelsior is incorporated and regulated in B.C., even though its mining operations are located in Arizona.

“MM says that it is based in Ontario, now downplaying [its] connections to B.C. as it previously argued in this proceeding,” the court noted. It said that “the true basis for MM’s ‘about face’ and contradictory positions on this unusual application related to a limitation issue and MM’s view that this B.C. action can assist in some way in the prosecution of the Ontario class action proceeding.”

By consolidating the ongoing B.C. case with the proposed class action in Ontario, the fund hoped to avoid the prospect of the claim in Ontario being dismissed based on the two-year limitation period for civil claims, the court said.

However, it rejected the fund’s application, citing “serious concerns about MM’s shifting and contradictory positions which appear to be borne from strategic reasons only.”

The court said it’s not clear that allowing the B.C. case to be transferred to Ontario will have any effect on a possible limitation defence in that proceeding.

“[W]hile MM’s U-turn in the litigation is not forum shopping in the true sense of choosing a jurisdiction for a juridical advantage, it does smack of unfairness and abuse of process given the history of this matter,” the court said.

“MM has failed to meet its burden to show that Ontario is clearly the more appropriate forum to decide the issues in this proceeding,” it concluded in rejecting the fund’s application. “To the contrary, the overall circumstances support allowing this action to continue.”