2024 QCCS 305, 2024 QCCS 305

9311408 Canada inc. c. Aviva Insurance Company of Canada 2024 QCCS 305 SUPERIOR COURT (Class actions) CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL No.: 500-06-001063-201 DATE: February 1 st , 2024 _____________________________________________________________________ BY THE HONOURABLE dominique poulin, j.s.c. _____________________________________________________________________ 9311408 CANADA INC. and GESTION RIC’ART LTÉE and JOENETTE INC. Applicants v.

AVIVA INSURANCE COMPANY OF CANADA and AVIVA GENERAL INSURANCE COMPANY and CO-OPERATORS GENERAL INSURANCE COMPANY and LLOYD’S UNDERWRITERS and MARC LIPMAN (in his capacity as “attorney-in-fact” in Canada for Lloyd’s underwriters) and NORTHBRIDGE GENERAL INSURANCE CORPORATION and FEDERATED INSURANCE COMPANY OF CANADA and THE WAWANESA MUTUAL INSURANCE COMPANY and WYNWARD INSURANCE GROUP Respondents _____________________________________________________________________ JUDGMENT (authorization for LEAVE TO adducE RELEVANT evidence ) _____________________________________________________________________ OVERVIEW [ 1 ] The applicants are seeking the authorization to institute a class action on behalf of all businesses in Quebec, except dentists and dental offices, who detained insurance coverage for “business interruption” or “operating loss” with the respondents as of March 16, 2020. [ 2 ] The proposed recourse is founded on business interruption losses sustained by the class members due to governmental orders or advisories issued in relation with the COVID-19 crisis, which occasioned changes or interruptions in their operations.

The allegations infer that the losses were covered by the respondents’ insurance policies, and that the insurers would have acted in concert to decline coverage and would have made false representations to the class members regarding their insurance coverage, in contravention to the Competition Act . [1] [ 3 ] The respondents seek leave from the Court to adduce evidence in order to argue the absence of a cause of action. [ 4 ] The demands are not contested and are granted, under reserve of the applicants’ right to contest the relevancy and probative value of the evidence at the hearing on certification. ANALYSIS

The evidence 1.1 Wawanesa [5] Wawanesa seeks leave to introduce the affidavit of Jelena Neron, Manager, who declares that this insurer did not writecommercial insurance policies in Quebec before November 1, 2020, and that no claim has been filed for COVID-19-related businessinterruption losses in Quebec as of the date of his affidavit. [6] He also attaches to his statement the policy wording of the commercial form and available endorsements issued by Wawanesaand he refers to specific provisions to give an understanding of the coverage afforded. 1.2 Federated and Northbridge [7] Both Federated and Northbridge seek to introduce the affidavit of Mr.

Mario Carier, their claims manager, together with thepolicy wordings for the business interruption coverage they issued. [8] Mr. Carier describes the type of policy wording and forms issued to cover small to larger enterprises and refers to specificprovisions which concern loss of business interruption. 1.3 Lloyd’s Underwriters [9] Lloyd’s underwriters seek leave to adduce the proposed affidavit of Mr. William Timothy Edward O’Connor, Solicitor andSenior Manager at the Society of Lloyd’s. [10] Mr.

O’Connor explains that the Lloyd’s respondents themselves are not insurers, are not parties to any Canadian insurancepolicies and did not provide business interruption insurance coverage to, or deny any business interruption insurance claims from theapplicants or other persons in Canada. [11] He explains that the Lloyd’s respondents support a market of independent underwriters who accept to underwrite various risksunder various policies and that those “insurers” can only be identified based on a given policy number or contract number referred to in agiven policy. [12] When there is a need to refer to or identify the specific underwriting members of Lloyd’s who are the insurers on a policy (forexample, in the context of a legal proceeding relating to a claim under that policy or otherwise), using the term "Lloyd's Underwriters" or“Underwriters at Lloyd’s” on its own would not be not proper or sufficient without a referral to a specific policy in order to refer to oridentify specific underwriting members of Lloyd’s who are concerned. [13] If used in isolation and outside the context of a specific policy, these generic descriptions do not refer to and cannot identify anyspecific underwriter or insurer, or a group of underwriters or insurers, or any specific syndicate or groups of syndicates responsible forcovering policyholders in Quebec. 2. applicable principles [14] The Court recently summarized the applicable principles as follows. [15]

Article 574 of the Code of Civil Procedure enunciates that the Court may permit the presentation of appropriate evidence at thestage of the application for authorization. [16] The case law teaches that the evidence allowed will be limited to what is necessary, or even indispensable, for the analysis ofthe authorization criteria. [17] Thus, evidence that demonstrates on its face that the essential allegations in the application for authorization are implausible,false or inaccurate or that the application for authorization is doomed to fail may be permitted.[2] [18] The Court may also consider that evidence is necessary to clarify the factual elements essential to the application for leave andto ensure a better understanding of the factual context of the application in order to verify the existence of an arguable case or to assist itsanalysis of the other criteria for authorization.[3] [19] In assessing the appropriateness of the evidence, the judge must take into account the analysis to be undertaken at theauthorization stage, without deciding on the grounds of contestation. [20] The Supreme Court clearly defined the scope of the verification of the existence of a defendable cause of action in L'OratoireSaint-Joseph du Mont-Royal v.

J.J.[4] It teaches that the authorization judge must avoid ruling on the merits of the class action in light ofthe alleged facts: [55] Je n’en dirai pas davantage en l’espèce sur ces notions complexes d’« organisations » ou de « corporations » religieuses,d’« église » ou de « congrégation ».

Certes, le tribunal peut trancher une pure question de droit au stade de l’autorisation si le sort del’action collective projetée en dépend; dans une certaine mesure, il doit aussi nécessairement interpréter la loi afin de déterminer sil’action collective projetée est « frivole » ou « manifestement non fondée » en droit : Carrier, par. 37; Trudel c. Banque Toronto-Dominion, 2007 QCCA 413, par. 3 ; Fortier c. Meubles Léon ltée, 2014 QCCA 195, par. 89-91 ; Toure c. Brault &Martineau inc., 2014 QCCA 1577, par.38 ; Lambert c.

Whirlpool Canada, l.p., 2015 QCCA 433, par. 12 ; Grouped’action d’investisseurs dans Biosyntech c. Tsang, 2016 QCCA 1923, par. 33 ; Finn (2016), p. 170. Toutefois, outre ces

situations, il n’y a en principe pas lieu pour le tribunal, au stade de l’autorisation, de « se prononcer sur le bien-fondé en droit desconclusions en regard des faits allégués » : Comité régional des usagers des transports en commun de Québec c. Commission destransports de la Communauté urbaine de Québec, (CSC), [1981] 1 R.C.S. 424, p. 429; Nadon c.

Anjou (Ville), (QC CA), [1994] R.J.Q. 1823 (C.A.), p. 1827-1828; Infineon, par. 60. […] (Emphasis added) [21] Nor can the authorizing judge be expected to substitute himself to the trial judge and to assess the probative value of theevidence before him.[5] [22] It follows that the appropriate evidence permitted at the authorization stage must not be susceptible of being challenged as to itsscope or probative value. Moreover, the evidence should not open a debate as to its sufficiency.[6] [23] The following quote from the Court of Appeal decision in Durand v.

Subway Franchise Systems of Canada summarizes thoseprinciples:[7] [51] Cette preuve doit en effet être essentielle, indispensable et limitée à ce qui permet de démontrer sans conteste que les faitsallégués sont invraisemblables ou faux. Elle ne doit pas avoir pour effet de forcer la tenue d’un débat contradictoire sur une question defond ou, dit autrement, entraîner la tenue d’un procès avant le procès. [52] Si la preuve déposée est susceptible d’être éventuellement contredite par le requérant, le juge de l’autorisation doit faire preuvede prudence et ne pas tenir pour acquis qu’elle est vraie.

Il doit se rappeler qu’il ne doit tenir pour avérés que les faits allégués par lerequérant et non pas ceux allégués par l’intimé, même lorsque la preuve produite par ce dernier démontre prima facie l’existence de cesfaits. [53] À ce stade, le fardeau du requérant en étant un de logique (également qualifié de fardeau de démonstration) et non de preuve, iln’a d’ailleurs pas à offrir une preuve prépondérante de ce qu’il avance, mais bien, tout au plus, une « certaine preuve » et n’a pasl’obligation de contester la preuve que l’intimé dépose, ni d’y répondre.

D’ailleurs, il n’est souvent pas en mesure de le faire puisqu’iln’a pas toujours toute la preuve en main, une bonne

partie de celle-ci pouvant être en possession de l’intimé. [54] Bref, la preuve déposée par un intimé au soutien de sa contestation ne change pas le rôle du juge de l’autorisation qui peut,certes, trancher une pure question de droit et interpréter la loi pour déterminer si l’action collective projetée est frivole, mais qui ne peut,pour ce faire, apprécier la preuve comme s’il y avait eu un débat contradictoire ou encore présumer vraie celle déposée par l’intimé alorsqu’elle est contestée ou simplement contestable. (References omitted; emphasis added) [24] Essentially, [t]he purpose is to avoid a trial at the certification stage, which is intended only to dismiss applications that arefrivolous or manifestly unfounded in law[8] (translation by the Court). [25] It is worth emphasizing that the judge must exercise his discretion with prudence and moderation and that this discretion isexercised in accordance with the rules of proportionality.[9] 3.

DISCUSSION [26] The defendants Wawanesa Federated and Northbridge all argue that the damages claimed in the proposed class action are notcovered by their insurance policies and raise the argument that the applicants have no right of action. [27] The Court agrees that the affidavits and policy wordings appear at this stage to be essential to understand the conditions of theinsurance policies founding the proposed class action an to analyze the criteria for certification. [28] As for the rather long affidavit submitted by the Lloyd’s underwriters, it comprehends information which normally would needto be supported by factual evidence.

The facts alleged are submitted as if they were undisputable. [29] The affidavit means to demonstrate that the insurers at risk are not properly designated, but does not seem to suggest any properdesignation if a class action was envisaged against the insurers at risk in the scope of a class action. [30] Given the absence of contestation, the Court will allow this evidence but will not be assessing same if it becomes disputed or ifit appears debatable. Adducing evidence does not modify the role of the judge at the authorization stage.

FOR THESE REASONS, THE COURT: [31] AUTHORIZES the Respondent, The Wawanesa Mutual Insurance Company, to file with the Court, for the purpose of thehearing on the Plaintiffs’ Application for Authorization to Institute a Class Action and to Appoint a Representative Plaintiff, the affidavitof Ms.

Jelena Nero, the contents of which are consistent with the affidavit attached hereto as Appendix A, together with Exhibits WA-1and WA-2 in support of such affidavit; [32] AUTHORIZES the Respondents Northridge General Insurance Corporation and Federated Insurance Company of Canada tofile the affidavit of Mario Carier Appendix A; [33] AUTHORIZES the Respondents Northridge General Insurance Corporation and Federated Insurance Company of Canada toadduce relevant evidence and file, as exhibits, Northbridge and Federated Policy wordings NR-4, NR-5, NR-6, NR-7, NR- 8, NR- 9,

NR-10, NR-11, NR-12, NR-13, NR-14 and NR-15; [ 34 ] AUTHORIZES Respondents Lloyd’s Underwriters and Marc Lipman (in his capacity as “attorney-in-fact” in Canada for Lloyd’s underwriters) to adduce the proposed affidavit of Mr. William Timothy Edward O’Connor (Exhibit L-1); [ 35 ] RESERVES the applicants’ rights to contest the relevancy and probative value of the above evidence. [ 36 ] THE WHOLE without costs. __________________________________ DOMINIQUE POULIN, J.S.C.

Mtre Christine Nasraoui MERCHANT LAW GROUP LLP Counsels for the applicants Mtre Matthew Liben Mtre Anthony Cayer BLAKE, CASSELS & GRAYDON s.e.n.c.r.l. Counsels for the respondents Lloyd’s Underwriters and Marc Lipman (in his capacity as “attorney-in-fact” in Canada for Lloyd’s underwriters) Mtre Antoine St-Germain Mtre Catherine Chaput GASCO GOODHUE ST-GERMAIN, s.e.n.c.r.l.

Counsels for the respondents Federated Insurance Company of Canada and Northbridge General Insurance Corporation Mtre Claude Marseille Mtre Elizabeth Desrochers Mtre Ariane Bisaillon BLAKE, CASSELS & GRAYDON LLP Attorneys for the respondent The Wawanesa Mutual Insurance Company Hearing date Written submissions