Docket: 1519 Microcell Communications Inc., Microcell Solutions Inc., Fido Solutions Inc., Rogers Inc. v. Rogers Wireless Inc., 2011 SKCA 136

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2011 SKCA 136 Date: 20111115 Between: Docket: 1519 Microcell Communications Inc., Microcell Solutions Inc., Fido Solutions Inc., Rogers Inc. and Rogers Wireless Inc.

Appellants - and - Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk, D & S Homes Ltd., Dorothy Dietz, Neil MacDonald, Neil Woolston, Erik Doucet, Betty Lou Gaudette, Anna Hanson, Julie Elkerton, Gregory Teed, Scott Andrews, David Musarai, Mark Burke, Rozanne Aquin, Jeff Parent, Corey Oppebeon, John Fearon, Nevin Law, Jerry Karalash, Jennifer Evenson, Danielle Favreau, Jeff Ledding, Terese Hafichuk-Walkin, Jessica Cordingley, Alison Weinberger, Terry Parker, Carol Walker, Cindy Belton, Leigh Edmunds, Lauren Tomashich, Stan Pappas, Amanda Donald, Richard Skuce, Lant Lutterodt, Shelley Frank, Steve Drover, Jon Gillis, Michael Lucas, Respondents Between: Docket: 1521 Telus Corporation, Telus Mobility, B.C.

Tel, Telus Communications (B.C.) Inc., Clearnet Communications Inc.,

and Alberta Government Telephones Appellants - and – Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk, D & S Homes Ltd., et al. Respondents Between: Docket: 1522 & 1599 Bell Aliant Regional Communications, Limited Partnership Appellant - and – Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk, D &S Homes Ltd., et al. Respondents Between: Docket: 1523 & 1598 Bell Mobility Inc. Appellant - and – Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk, D&S Homes Ltd., et al. Respondents Between: Docket: 1524 MTS Communications Inc. Appellant - and – Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk, D&S Homes Ltd., et al. Respondents

Between: Docket: 1525 Saskatchewan Telecommunications and Saskatchewan Telecommunications Holding Corporation Appellant - and – Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk, D&S Homes Ltd., et al. Respondents Respondents Coram: Vancise, Jackson and Smith JJ.A. Counsel: Kent Thomson and Davit Akman for the Appellants Microcell Communications Inc., Microcell Solutions Inc., Fido Solutions Inc., Rogers Inc. and Rogers Wireless Inc. Gord Kuski, Q.C. and Phil Gallet for the Appellants Telus Corporation, Telus Mobility, B.C.

Tel, Telus Communications (B.C.) Inc., Clearnet Communications Inc., and Alberta Government Telephones William Johnson, Q.C. for the Appellants Bell Aliant Regional Communications, Limited Partnership Kathryn Podrebarac and Tim Morgan for the Appellants Bell Mobility Inc. Jeff Grubb, Q.C. for the Appellants MTS Communications Inc. Robert W. Leurer, Q.C., Jason Mohrbutter and Tristan Culham for the Appellants Saskatchewan Telecommunications and Saskatchewan Telecommunications Holding Corporation E.F.A. Merchant, Q.C. and Casey Churko for Respondents Mark Frey, Trudy Betthel, Bryan Pawlachuk, Nathalie Pawlachuk,

D&S Homes Ltd., et al. Appeal: From: 2008 SKQB 79 Heard: December 13-14, 2010 Disposition: Appeal Dismissed Written Reasons: November 15, 2011 By: The Honourable Madam Justice Jackson In Concurrence: The Honourable Mr. Justice Vancise The Honourable Madam Justice Smith Jackson J.A. I. Introduction [ 1 ] These reasons pertain to eight appeals, all arising out of decisions of Gerein J. of the Court of Queen’s Bench in relation to an application by the Respondents, Mark Frey, et al., for certification as a class action of a claim advanced against the Appellants.

The Appellants are six corporations that provide cellular or wireless voice services operating across Canada. [1] The Respondents assert a claim in unjust enrichment to recover what they claim were improperly imposed “system access fees” charged by the Appellants to their customers over a period of approximately 20 years. [ 2 ] The Appellants appeal from the decisions of Gerein J. on the basis that he made fundamental errors by concluding that the Respondents had met all the criteria necessary to certify a class action in this jurisdiction under s. 6 of The Class Actions Act , S.S. 2001, c. C-12.01.

Three of the Appellants raise issues of a jurisdictional nature. For the reasons that follow, I have concluded that Gerein J. made no error in certifying a class action in unjust enrichment or in asserting jurisdiction over all Appellants. Some refinement to the common issues may prove to be desirable, but that issue should be left to Gerein J. as he continues with the case management of this action. II. Background [ 3 ] The procedural aspects of the claim began in 2004 with the commencement of a class action brought in the name of Mark Frey and certain other named individuals.

The action was commenced against the six Appellants for the recovery of “system access” fees paid by the Respondents on the basis that the fees paid for “access” to a government network. It was alleged that the understanding or the implication of the collection of the fees was that they were required to be paid to the government or to pay for a service that was not provided or had already been compensated for elsewhere in the contract. The Respondents pleaded numerous causes of action: (

i) breach of contract; (ii) breach of the duty to inform; (iii) deceit, misrepresentation and negligence; (iv) collusion; (

v) breach of fiduciary obligation; (vi) violation of competition and consumer legislation; and (vii) unjust enrichment. [ 4 ] As Gerein J.’s view of the background facts and positions of the parties is crucial to the analysis that follows, I will quote from his reasons directly (see: 2006 SKQB 328 , [2006] 12 W.W.R. 545): [2] This case is about certain fees charged by the defendants and collected from the plaintiffs. The central issue is the legitimacy of those fees .

What follows is a brief overview of events as described in the pleadings, the several affidavits filed and the briefs of law provided. [3] The defendants, with a few exceptions which I will address elsewhere in companion decisions, provide wireless telecommunication services which include cellular telephone services. They do so in various regions of this country and have done so far into the past. Different defendants entered the field at different times.

[4] As of July 1, 1985, the Department of Communications (now Industry Canada) required each mobile cellular subscriber to be licensed and to pay a fee for that license. Some of the defendants collected the fee from the subscriber and remitted it to the Department of Communications. Others did not and the subscriber was required to remit the fee directly to the Department. In 1987 this changed. [ 5 ] On April 1 of that year, the individual licensing requirement and the attendant fees were eliminated.

In its place the Department sold radio channel licenses, also known as spectrum licenses, to the defendants as providers of wireless services. At about that time a certain charge appeared on the invoices sent to subscribers. The charge was described in different ways, including "license administration fees", "system administration fees", "system license administration fees" and "system access fees". The description "system access fees" was the most common and it is the one I will use throughout intending it to include all others. That situation has continued to the present time.

Therein lies the complaint of the plaintiffs. [ 6 ] They argue that when the individual licensing fees were abolished, the defendants continued to collect that fee under the guise of the "system access fees" . It is argued that they were not authorized to do so and they must account to the plaintiffs for the money received. The claim extends back some seventeen years (para. 110 of the statement of claim). [ 7 ] The defendants disagree.

They say the "system access fees" are legitimate and constitute a charge to defray various operating costs of which only a portion is the cost of the spectrum license fee which they must now pay. It is argued that they are entitled to recover those costs and the suggestion to the contrary is without merit . (emphasis added) [5] Gerein J. has been the case management judge since 2004, and he remains seized with that task. He has rendered numerous written decisions, some of which are now the subject matter of this appeal.

On July 18, 2006, he found that only one of the causes of action advanced by the Respondents could sustain a class action: the claim in unjust enrichment ( 2006 SKQB 328 ). He concluded that the Respondents had met all the criteria necessary to result in the certification of a class action, with respect to unjust enrichment, except for the filing of a workable litigation plan and the naming of a representative plaintiff. The Respondents were given leave to reapply. This they did, and in a further fiat, dated September 17, 2007, Gerein J. found that the new plan was satisfactory ( 2007 SKQB 328 , 312 Sask. R. 4).

At the same time, he found Colin Chatfield to be a suitable representative plaintiff. Finally, Gerein J. resolved certain jurisdictional issues ( 2008 SKQB 79 , 329 Sask. R. 42). Specifically, he found that (

i) Saskatchewan has jurisdiction over all of the Appellants, including Bell Alliant; (ii) he need not give effect to the exclusive jurisdiction clause in the Bell Alliant contracts; and (iii) Saskatchewan is the appropriate forum to host this class action against all of the Appellants. [6] The following is a

summary description of the various decisions made by Gerein J. that are relevant to the within appeal: 1. the pleadings disclose a cause of action for unjust enrichment in that, if the facts as pleaded are accepted as true, it is open to a court to find that the Appellants had unlawfully obtained monies from the plaintiffs and must account for it (see: 2006 SKQB 328 at para. 45 ); 2. there is an identifiable class, described as follows: All residents of Canada who have purchased wireless services from any of the defendants since April 1, 1987 and paid a fee variously described as a ( sic ) “system access fees”, “system administration fees”, “license administration fees” or “system license administration fees.” [2006 SKQB 328, at para. 56] 3. the claim supports these common issues (see: 2006 SKQB 328 at para. 65 ): (1) whether the defendants wrongfully collected from the plaintiffs certain fees variously described as “system access fees”, “system administration fees”, “license administration fees” or “system license administration fees” and must now account for those fees; and (2) what is the amount of the loss sustained based on the fees collected if an accounting is to be made. 4. a class proceeding is the preferable procedure for the resolution of the common issues (see: 2007 SKQB 328 at para. 3 ); 5. a representative plaintiff is not necessary for each defendant and Colin Chatfield is named as the sole representative plaintiff for the whole class (see: 2006 SKQB 328 at paras. 78 to 80 and 2007 SKQB 328 at para. 9 ); 6. the litigation plan is workable (see: 2007 SKQB 328 at para. 20 ); 7. the Court has territorial competence over Bell Aliant and a stay of the action against them was refused (see: 2006 SKQB 330 , 282 Sask.

R. 29 at para. 19 and 2008 SKQB 79 at para. 7 ); and 8. Saskatchewan is the appropriate forum notwithstanding the potentially small number of subscribers of Bell Mobility in this jurisdiction ( 2008 SKQB 79 at paras. 8 and 9 ); and 9. the Court should not decline jurisdiction over the action in relation to Bell Aliant, notwithstanding the presence of an exclusive jurisdiction clause in many of the contracts with that corporation ( 2006 SKQB 330 at paras. 16 and 17 and 2008 SKQB 79 at paras. 6 and 7 ). [7] Gerein J. also made other decisions, which are not the subject matter of this appeal: (

i) he amended the certification order to stay the claims of any parties who are bound by an arbitration clause ( 2008 SKQB 79 at paras. 10-12 ); (ii) he divided the identified class into resident and non-resident subclasses, pursuant to s. 8(2) of the Act , with the resident subclass being certified on an opt-out basis and the non-resident subclass being certified on an opt-in basis (see: 2006 SKQB 328 at para. 56 ); (iii) he amended the style of cause to replace

all Jane and John Doe plaintiffs with named plaintiffs, and he refused to add additional defendants (see: 2009 SKQB 165 , 334 Sask.

R. 55); and (iv) he refused to convert the identified class into a national class action on an opt-out basis because the amendments to The Class Actions Act, which permit such a class, came into effect after the class action was commenced and, according to him, the amendments do not apply retroactively (see: 2009 SKQB 165). [ 8 ] The Appellants applied individually to this Court for leave to appeal various aspects of the decision of Gerein J. to certify the within action as a class action, pursuant to s. 39(3) of The Class Actions Act .

While there are subtle differences between each of the notices of appeal, the Appellants’ arguments taken as a whole challenge almost every aspect of Gerein J.’s certification, and whether the criteria under s. 6 of the Act have been met. [2] Specifically, the Appellants allege that: (

i) the pleadings do not disclose a cause of action in unjust enrichment; (ii) no identifiable class can be identified that would support common issues or a class action; (iii) common issues cannot be found; (iv) a class action is not the preferable procedure for the resolution of the dispute; and (

v) the litigation plan is not adequate. In addition to alleging that Gerein J. erred in those respects, each of Bell Mobility, Rogers, MTS and Bell Aliant allege that there must be a representative claimant named in the actions against them. [ 9 ] In separate notices of appeal filed pursuant to s. 7(2) of The Court of Appeal Act, 2000 , S.S. 2000, c. C-42.1, Bell Aliant and Bell Mobility challenge the decisions of Gerein J. to assume jurisdiction over the actions against them.

Bell Aliant’s first position, unique to it in this action, is that Saskatchewan does not have territorial competence over it, but if Saskatchewan does have territorial competence, Gerein J. should, nonetheless, have given effect to the exclusive jurisdiction clauses contained in its contracts. Bell Mobility alleges that Gerein J. should have declined jurisdiction as it has only a few Saskatchewan customers. [ 10 ] Smith J.A. granted leave to appeal on March 15, 2010: (

a) to all Appellants against the certification order in files 1519, 1521, 1522, 1523, 1524, and 1525; (

b) to Bell Aliant on file 1599 in relation to the order that Saskatchewan has territorial competence over it; (

c) to Bell Mobility on file 1598 to appeal Gerein J.’s refusal to find that Saskatchewan is forum non conveniens in relation to the claim against Bell Mobility. Smith J.A. also granted leave to the Respondents to appeal Gerein J.’s decision denying them the right to certify a national class action on an opt-out basis in accordance with the amendments to The Class Actions Act (file 1773). In granting leave on this point, Smith J.A. directed the Respondents to “file a formal notice of appeal setting out the grounds of appeal within ten days of the date” of her fiat.

See: 2010 SKCA 30, 2010 SKCA 31, 2010 SKCA 32 , 2010 SKCA 33, 2010 SKCA 34, 2010 SKCA 35, 2010 SKCA 36, 2010 SKCA 37 and 2010 SKCA 38 at para. 28 . The Respondents did not file such a notice. [ 11 ] In this Court, the Respondents filed an application to adduce fresh evidence in the form of an affidavit by Bryan Pawlachuk, a Rogers customer, who attaches five documents, as follows: 1.

A report from Information Services Corporation of Saskatchewan on the registration of Bell Aliant Regional Communications, Limited Partnership showing Aliant was registered to do business in Saskatchewan as of September 21, 2006, which is after the Respondents commenced the within action. 2. A 1996 Cantel dealer’s manual which Mr. Merchant apparently obtained from a former unidentified employee of Cantel, which contains an instruction to the following effect: EXPLAINING FIRST MONTH BILLING Explain a typical first month’s bill to the customer.

Be sure to explain Service Initiation Fee (SIF) and System Access Fee (SAF). • Service Initiation Fee (SIF) – one time administration charge for activating the phone • Service [ sic ] Access Fee (SAF) – annual license fee charged for the use of the number charged by the CRTC and is collected by Cantel on their behalf • Monthly Fees for Enhanced Services – if applicable Inform the customer that if they should have any additional questions regarding their first month’s bill to either call the Sales Representative or Customer Service. 3.

A printout of the Rogers website (taken October 28, 2010), which notes that the system access fee would be phased out and the monthly service fee (in common parlance, the “rate plan” or “contract price”) would be increased by $5.00. 4. A printout of an

article from the CBC (dated September 22, 2009), which apparently establishes that October 5, 2009 was the last day that new contracts with Rogers would include a “system access fee” and describes how the rate plans and new fees would operate. 5. A printout of the TELUS website, which describes new “Clear Choice” plans, that do not include a system access fee, but instead charge $5.00 extra on the rate plan and include new services.

III. Issues and Standard of Review [ 12 ] I have determined that the various arguments of the Appellants give rise to the following broadly stated issues: 1. Whether the fresh evidence should be admitted? 2. Did Gerein J. err by finding an adequate claim for unjust enrichment had been pleaded in the Amended Claim, as required by s. 6(

a) of the Act ? 3. Did Gerein J. err by determining there is an “identifiable class” as required by s. 6(

b) of the Act and finding the common issues he identified were indeed “common issues,” as required by s. 6(

c) of the Act ? 4. Did Gerein J. err by finding that a class action is the “preferable procedure” for the resolution of the common issues, as required by s. 6(

d) of the Act ? 5. Did Gerein J. err by finding the litigation plan to be workable? 6. Did Gerein J. err by finding that it was not necessary to have a representative plaintiff for each defendant? 7. Did Gerein J. err by finding that the Court has territorial competence over Bell Aliant? 8. Did Gerein J. err by refusing to decline territorial competence over Bell Mobility and MTS? 9. Did Gerein J. err by not giving effect to the exclusive jurisdiction clauses contained in the Bell Aliant contracts? 10.

Did Gerein J. err by deciding the jurisdictional applications after having decided to certify a class action in unjust enrichment? It will become apparent that some of these issues require the analysis of a series of sub-issues. [ 13 ] For the most part, the way in which these issues have been cast, they raise questions of law, reviewable on a standard of review of correctness (see: Jameson Livestock Ltd. v. Toms Grain & Cattle Co. , 2006 SKCA 20 , 279 Sask. R. 281 at paras. 12 to 18 and Sorotski v.

CNH Global N.V. , 2007 SKCA 104 , [2008] 1 W.W.R. 386 at paras. 48 and 54 ), unless otherwise stated in these reasons. IV. Analysis 1. Whether the fresh evidence should be admitted ? [ 14 ] The Appellants resist the admission of the fresh evidence, largely on procedural grounds regarding notice and the Respondents’ choice of Mr. Pawlachuk as an affiant as he had been rejected by Gerein J. as a suitable representative plaintiff. Further, they assert that the proffered evidence violates the rules against the reception of hearsay evidence.

I have concluded that only the proof of Bell Aliant’s registration in Saskatchewan should be admitted, but the balance of the fresh evidence should be rejected for these reasons. [ 15 ] The fresh evidence, in relation to the Bell Aliant registration, is reliable, relevant evidence that bears on a potentially decisive issue and could be expected to affect the result in relation to the issue for which it is tendered. A registration after the action is commenced cannot clothe a jurisdiction with territorial competence under s. 4 (

d) of The Court Jurisdiction and Proceedings Transfer Act , S.S. 1997, c. C-41.1, (the CJPTA ), but it is a factor that could bear upon a potentially decisive issue in determining territorial competence under s. 4 (e). As I explain later in these reasons, I have concluded that Gerein J. did not err when he concluded that Saskatchewan has territorial competence over Bell Aliant by virtue of a real and substantial connection to the jurisdiction.

If there had been any doubt in that regard, the fact that Bell Aliant is now resident in this Province would play a decisive role. [ 16 ] The Respondents proffer the balance of the documents, referring to how the fee was described in the Cantel manual (a Rogers entity) and various websites belonging to Rogers and one in relation to Telus, to provide some further evidence to support the certification of a cause of action in unjust enrichment, the existence of the common issues, and the determination as to the preferable procedure against all of the Appellants.

Rogers, the Appellant to whom this evidence largely pertains, resists the admission of the fresh evidence, on the basis of its reliability. It challenges the Respondents’ choice of Mr. Pawlachuk as an affiant, as he had been rejected by Gerein J. as a suitable representative plaintiff. Further, Rogers asserts that the proffered evidence violates the rules against the reception of hearsay evidence. [ 17 ] The submission of this fresh evidence at this stage of the proceedings is clearly not required.

It is not required for the purposes of the certification of the cause of action as the facts in the pleadings must be taken as true, and extraneous evidence is neither relevant nor required on this issue (see: Hollick v. Toronto (City) , 2001 SCC 68 , [2001] 3 S.C.R. 158 at para. 25 ). While the Court must be satisfied there is some basis in fact for the balance of the certification requirements, this evidence goes far beyond that and is an attempt to convert the appeal into a consideration of the merits of the claim on the basis of untested evidence—in relation to two Appellants only.

Thus, I have concluded that the fresh evidence tendered in relation to Rogers and Telus is best left to be tested by the class action judge and should not be received in this Court. Its reliability has been questioned. It has limited applicability. Most importantly, it is not

necessary to resolve the issues on appeal. 2. Did Gerein J. err by finding an adequate claim for unjust enrichment had been pleaded in the Amended Claim, as required by s. 6(

a) of the Act ? [ 18 ] According to s. 6(

a) of the Act , a proposed representative plaintiff, seeking to certify a class action, must satisfy the court that “the pleadings disclose a cause of action.” In Hoffman v.

Monsanto Canada Inc. , 2007 SKCA 47 ; 283 D.L.R. (4th) 190 at para. 46, the Court emphasized the importance of the screening function provided by s. 6 of the Act , and held that a chambers judge, must guard against the certification of "less than genuine actions." As Cameron J.A. wrote, on behalf of the Court, the plaintiff must demonstrate “what appears to be an authentic cause or causes of action” (see: Hoffman at para. 45 , emphasis in original).

At this stage of the inquiry, it is necessary for this Court to be certain that “there exists a plausible basis for supposing the defendants could be liable to the claims of the class” (see Hoffman at para. 50 ). [ 19 ] The theory of the Respondents’ case is reflected in these paragraphs taken from the Amended Statement of Claim: The Plaintiffs 1.

The Plaintiff, Mark Frey, resides in the City of Saskatoon in the Province of Saskatchewan, and at all material times has been a customer of SaskTel for wireless and cellular service in Saskatchewan and Canada, and has been subject to pay system access fees on accounts from SaskTe1 . [3] . . . Factual Background 109. Cellular and wireless telecommunications services [hereinafter referred to as “cellular” or “wireless and cellular service(s)”] have been commonly available in Canada since approximately 1982. The Defendants are all of the current and past providers of wireless and cellular services in Canada.

In most of Canada, all of the Defendants enjoy, or at material times have enjoyed, a monopoly, duopoly, triopoly, or quadropoly over cellular and wireless services. In many areas of Canada, the choice of cellular service is or has been a singular or binary choice between one or two cellular or wireless service providers. 110.

Within the last seventeen ten [ sic ] years, all of the Defendants have adopted the practice of adding a monthly ( or annual ) “system access fee”, “system licencing charges”, or similarly described fees or charges [hereinafter referred to as “additional charges” or “extra monthly charges”] to each of their customers’ accounts (with the exception of recently introduced “All-in-One” service plans or pre-paid cellular service).... . . . 111. All of the Defendants implemented these additional charges to their customers' accounts contemporaneously, normally in the amount of $6.95 per month.

The same amount bears no relation to any actual cost of providing wireless or cellular services, but was an amount selected and designed by the Defendants to proliferate the misrepresentation that the same extra monthly or annual charges were being collected as a tax on behalf of a Government agency . 112. The Defendants provided insufficient, deficient, deceitful, fraudulent or misleading information to its customers with respect to the nature of these extra charges.

All of the Defendants adopted the practice of either not disclosing these additional charges when soliciting customers or misrepresenting the nature of these additional charges as being Government taxes, being collected on behalf of the Government of Canada, one of its agencies, or another level or authority of Government (hereinafter collectively referred to as the "Government".) 113.

Alternatively, the Defendants omit, or at material times have omitted, to make reference to the existence of an additional monthly or annual charges made by them, in their promotional materials and representations to customers, or made vague and ambiguous reference to the existence of a monthly or annual "system access fee" or "system licensing charge" without disclosing that the true nature of this additional charge is simply an additional fee charged to the Plaintiffs by the Defendants for their own benefit . 114.

There is in fact no Government tax, fee, or charge to be levied on wireless or cellular customers on a monthly basis or against individual wireless or cellular accounts. Although there are annual fees charged by the Government to the Defendants as providers of cellular and wireless services, these fees amount to less than 20% of the additional charges being charged to their customers under the guise of Government taxes.

For the four largest cellular providers (Bell, TELUS, Rogers, and Fido), the actual fees charged to them by the Government in 2004 is forecast to be $126,000,000.00, whereas the same Defendants will collect $863,000,000.00 in additional charges from their customers. The difference of $737,000,000.00 collected by the same four Defendants, in 2004 alone, represents a windfall 85.4% realized through the same Defendants’ deceit, misrepresentation, and false advertising. . . . The Common Issues 116. All of the Plaintiffs and Class Members have in common that each has suffered:

a. That their cellular accounts have been subject to an additional charge, normally $6.95 per month ( plus applicable GST, and where applicable, PST, HST, and other taxes thereon ), imposed by the Defendants, expressed, or implied, to represent a Government, regulatory, or third party tax, fee, or charge; b.

That they have been subject to deceit, misrepresentation, and false advertising, perpetrated by the Defendants, with the intent to deceive and misled the Plaintiffs into believing that the “system access fees”, “system licensing charges”, ”system license administration fees”, or similarly described fees and charges (which are herein generically referred to as “system access fee(s)”) were a form of Government taxation or a regulatory fee , and being collected by the Defendants on behalf of the Government or its departments and agencies such as the CRTC, or third party institutions ; … d.

That each has been charged an additional fee, normally $6.95 per month, by the Defendants, over and above the rate plan agreed to between the Plaintiffs and the Defendants . . . . Breach of Contract and Duty to Inform 120. The actions, omissions, and breaches of legal obligations made by the Defendants have caused the Defendants to be in breach of contract with the cellular service agreements made between them and the Plaintiffs.

The Defendants, both directly and through their agents, entered into agreements with the Plaintiffs and Class Members to provide cellular service at a given rate or amount per month, as defined in their rate plan promotional materials; and the Defendants are in breach of contract by having failed to disclose, falsely described or advertised, or misrepresented that additional monthly or annual charges commonly referred to by the Defendants as being a “system access fee" or “system licensing charge” were simply additional monthly or annual charges charged by the Defendants to the Plaintiffs, over and above the agreed monthly rate plan. 121.

Further, the Defendants made unilateral changes to their rate plans or service agreements, including the imposition of additional charges, without the consent of the Plaintiffs, in breach of the contractual terms which existed between the Plaintiffs and Defendants to provide cellular services. 122. It was an expressed [ sic ] or implied term of the contract between the Plaintiffs and the Defendants that the Defendants’ fees for providing cellular services would be limited to their rate plan.

The Plaintiffs are entitled to reimbursement for all amounts paid to the Defendants (plus interest at the same rates charged by the Defendants) in excess of the rate plans presented by the Defendants. . . . Aggravated, Punitive and Exemplary Damages 150. As a result of the Defendants' deceitful conduct and representations, their customers and the public were led to believe that a "system access fee" or “system licencing charge” was an unavoidable Government tax and charge, which the Defendants were mandated to collect on behalf of the Government. . . . General 155a.

By engaging in the acts and conduct described herein, the Defendants unjustly enriched themselves and deprived class members of a fair market place, as well as financially deprived members of the class and causing the Plaintiff class to suffer economic harm. Amongst other things, the Defendants received an unjust enrichment by reason of their additional charges of "system access fees", "system licencing charges", "system licence administration fees" or similarly described fees or charges, and the Plaintiffs have suffered a corresponding deprivation.

There is no juristic reason for the benefit or enrichment of the Defendants. The Plaintiffs claim that as a result of the Defendants imposing additional charges on their customers' accounts as system access fees , the Defendants have unjustly benefited from payment of these charges by the Plaintiffs.

The Plaintiffs claim for restitution of these monies unjustly charged and received by the Defendants . [underlining taken from the Amended Statement of Claim to indicate where the statement of claim has been amended; italics are added as emphasis.] [ 20 ] In order to determine whether these pleadings disclose a cause of action in unjust enrichment, Gerein J. began with a review of the relevant law. He concluded that the Supreme Court of Canada has recognized unjust enrichment as a cause of action capable of standing alone: Garland v. Consumers’ Gas Co. , 2004 SCC 25 , [2004] 1 S.C.R. 629 at para. 30 .

He noted that the cause of action has three elements: (

i) an enrichment of the defendant; (ii) a corresponding deprivation of the plaintiff; and (iii) an absence of juristic reason for the enrichment. He then succinctly stated: [45] When I review the facts pleaded, if they turn out to be accurate, it may result in a finding that the defendants unlawfully obtained monies from the plaintiffs and must account for it. This being so, it cannot be said that it is plain and obvious that the claim for unjust enrichment cannot succeed.

Conclusion [46] I have concluded that it is plain and obvious that the pleadings do not disclose a cause of action for breach of contract, misrepresentation in any form, breach of fiduciary duty, conspiracy or a cause of action based on a statutory entitlement. However, I also conclude that the pleadings do disclose a cause of action for unjust enrichment. Accordingly, the plaintiffs have demonstrated

compliance with the first statutory requirement that there be a reasonable cause of action. [2006 SKQB 328] [21] When Gerein J. determined who the class members would be, he made these further comments regarding the nature of the claim: [52] ... I have read all the affidavits and any cross-examination of affiants in ascertaining what factual basis has been established at thisstage of the proceedings. The second is that I have proceeded on the basis that I have found that there is only one valid cause of action,i.e., unjust enrichment.

Keeping the last in mind it must be remembered that the essence of this case is that the defendants have collectedmonies from the plaintiffs absent lawful authority to do so. [53[ There is testimony from several individuals that they purchased wireless services from one of the defendants. At the outset of thearrangement they were advised there would be a governmental charge which was frequently called a system access fee. Over the yearsthey have paid those fees. They now believe that they should not have been required to do so. [54] There was extensive cross-examination of each affiant.

The cross- examination addressed many areas. It demonstrated thatmemories are faulty and details are lacking. However, in the end I am satisfied that the various affiants paid a system access fee. It maybe that the fee was wrongly charged. At this stage of the proceeding no more is required.

However, at the same time I am satisfied thatthe claim should be restricted to that fee. [2006 SKQB 328, emphasis added] [22] For their part, the Appellants agree, generally, that the matter falls to be determined under the criteria established in Garland.Further, there is general agreement that the facts as pleaded are sufficient, if proven, to establish the first two requirements of this test: anenrichment of the defendants and a correspondent deprivation of the plaintiffs in respect of all or part of the system access fees collected.They argue, however, that the plaintiffs have failed to plead facts sufficient to establish an absence of juristic reason for the enrichmentand corresponding deprivation.

It is not enough simply to allege that charging the fees was “wrongful” or unlawful. [23] In Garland, the Court indicated that the proper approach to an analysis of a claim in unjust enrichment is in two parts.

In the firststage, the onus is on the plaintiff to show that the defendant has gained a benefit, that the plaintiff has suffered a corresponding loss, andthat there exists no juristic reason, or justification, for the defendant’s enrichment at the expense of the plaintiff in any of the establishedcategories of contract, disposition of law, donative intent or other valid common law, equitable or statutory obligation.

If the plaintiff issuccessful in this task, the onus then shifts to the defendant to rebut this prima facie case and establish another reason to deny recovery. [24] It follows, the Appellants argue, that to establish a cause of action in unjust enrichment, the pleadings must not only positivelyallege an enrichment and a corresponding deprivation, but must also plead sufficient facts to negate the established categories of juristicreason for the enrichment.

It is not enough, it is argued, simply to allege, in general terms, that there was no juristic reason for theenrichment, as the Respondents do in para. 155a of the Amended Statement of Claim. [25] In the instant case, the pleadings explicitly allege that the impugned fees were charged by the Appellants in the context of theprovision of cellular telephone services to consumers. Accordingly, the allegation of enrichment of the Appellants and a correspondingdeprivation to the Respondents is clear.

Further, in this context there is no reasonable argument that the pleadings are inadequate tonegate the existence of “disposition of law, donative intent or other valid common law, equitable or statutory obligation.” TheAppellants’ position, however, is that the pleadings allege that the payment of the fees was made “pursuant to” contracts between the Appellants and their subscribers, and that, accordingly, far from negating an established category of juristic reason, this allegationprovides one.

Thus, according to the Appellants, it was necessary for the Respondents to plead that the contracts were void or otherwiseunenforceable. This they have not done. [26] That the existence of a contract between the parties authorizing the impugned enrichment can provide a satisfactory juristic reasonjustifying the enrichment, and thus negate a cause of action based on unjust enrichment, is clear. This is inherent in the very notion of anenforceable bargain and is, in any case, confirmed in a number of cases in addition to Garland. See, for example, Peter Kiewit Sons’ Co.of Canada v.

Eakins Construction Limited, (SCC), [1960] S.C.R. 361; Rathwell v. Rathwell, (SCC),[1978] 2 S.C.R. 436 at 455-56; Jedfro Investments (U.S.A.) Ltd. v. Jacyk Estate, 2007 SCC 55, [2007] 3 S.C.R. 679 at paras. 30-34;Pacific National Investments Ltd. v. Victoria (City), 2004 SCC 75, [2004] 3 S.C.R. 575. [27] However, for the contract to provide a juristic reason for the enrichment, the clause doing so must in fact justify the defendant’senrichment at the expense of the plaintiff, and the clause must be valid and enforceable.

Thus, it is open to the Respondents to argueeither that the clauses authorizing the collection of the “system access fees”, properly interpreted, do not justify the Appellants’ retentionof these sums for their own use, or enrichment, or, alternatively, if they do, that they are not valid or enforceable. [28] Both positions find some support in the factual allegations in the statement of claim. In particular, I note the following allegationscontained in the pleadings:

(1) that the “system access fees” were charged as an “add on” or “extra” fee, over and above the charges imposed for the rate plan that subscribers had agreed to (although this allegation runs throughout the pleadings, see in particular paras. 110-116, 120-123 and 126 of the Amended Statement of Claim); (2) that the contracts expressly or implicitly provided that these extra charges were collected on behalf of the government or a third party government agency as a mandatorily imposed tax, fee or charge to be paid to that third party (see, especially, paras. 111 and 116(a), but also, inter alia, paras. 112-113, 115, 120, 126, 128-129, 137a and 141, among others of the Amended Statement of Claim); (3) that, in fact, there was no government tax, fee or charge to be levied on cellular customers and only a small portion of the system access fee was paid to the government for the Appellants’ spectrum licenses (see para. 114 of the Amended Statement of Claim); (4) that the sums paid to the Appellants by the cellular subscribers by way of “system access fees” were retained by the Appellants and amounted in fact to an extra charge, over and above the amount agreed to be paid for the provision of cellular services (see, inter alia , paras. 113, 116(d), 120-122, 127 and 141 of the Amended Statement of Claim). [ 29 ] These allegations are clearly sufficient, if proven, to support the contention that the clauses in the cellular service contracts permitting collection of “system access fees”, properly interpreted in all the circumstances surrounding their implementation, including the regulatory history, past practice, timing and mode of implementation as well as representations made by the Appellants to customers and the public, uniformly permitted collection of the “system access fees” solely for the purpose of paying those fees to a third party, and did not authorize the Appellants to retain the fees, or any portion thereof, for their own use.

This constitutes a clear pleading that the Appellants’ enrichment by way of collection of these fees was not “pursuant to the contracts”, and the contracts therefore do not constitute a juristic reason for that enrichment. [ 30 ] In argument before us, the Respondents have emphasized another aspect of this same point. They say that, in retaining these fees for their own use, the Appellants have in effect imposed an extra charge, over and above what the subscribers agreed to pay (in what is usually described as a “rate plan”), for the provision of cellular telephone services.

The Appellants have thus been “double compensated” or compensated twice for the same service. In effect, the Respondents argue, no consideration was given for the payment by subscribers of the system access fee because the charge was over and above what they agreed to pay for the service. The clauses in the contracts permitting collection of the “system access fees” are therefore unenforceable for lack of consideration—so the argument goes.

They, therefore, do not provide juristic reason for the Appellants’ enrichment at the expense of the subscribers. [ 31 ] This way of putting the point must be approached with some caution, in my view. The doctrine of consideration does not necessarily prohibit the imposition of two separate charges for the provision of the same services, so long as the parties have agreed that this would be their bargain.

In other words, if the Appellants, or any of them, are able to show that the subscribers agreed to pay two separate charges to the Appellants for the provision of cellular service (a “rate plan” charge, for example, based on the amount of cellular telephone use plus an “administration” fee charged to all users), such a contract would not fail for lack of consideration. Accordingly, the Respondents’ point, like the first one, depends upon the argument that the contracts, properly interpreted, in all the circumstances relevant to that

interpretation, did not provide for the imposition of the system access fees as part of the charge for the delivery of cellular service. Rather, they provided only for their collection for and on behalf of a third party (the government or a government agency) as a mandatory tax or fee imposed by that party.

Since no such fee was, in fact, imposed by the government, no consideration was provided for that charge. [ 32 ] On this understanding, the “failure of consideration” argument is, in fact, largely superfluous, since the real issue is whether the clauses in the cellular contracts authorizing collection of the “system access fees” permitted the Appellants to retain these for their own use as an agreed to extra or add on charge for services rendered. [ 33 ] I do note, however, that in a case in many ways similar to the one before us, the Northwest Territories Court of Appeal refused to strike a statement of claim in a class proceeding suing Bell Mobility for breach of contract and unjust enrichment based in part on a partial failure of consideration, although principally on the general argument of enrichment absent a juristic reason for the enrichment (see: Bell Mobility Inc. v.

Anderson , 2009 NWTCA 3 ). The plaintiffs, subscribers to mobile telephone services from Bell, claimed they were charged a fee for 911 services when such services did not exist or existed in a modified form only. Côté J.A., writing for the Court, found that the claims in contract and unjust enrichment were sufficiently arguable to allow the claims to move forward to the certification stage: [6] One heading mentions breach of contract. Though there may be here no express contract to supply 911 services, an implied contract is clearly also pleaded .

We cannot see why such a contract is not arguable on these very striking facts, especially if evidence of other circumstances and dealings is led at trial.

It would be an unusual contract which let one party charge for doing nothing, and clear words would be needed . [7] The other heading refers to unjust enrichment, which also seems to us arguable, both in the general form alleged (no juristic reason), and also under some of the nominate forms of unjust enrichment long recognized by English and Canadian case law. [8] One of those is money paid under a mistake of fact, which paras. 6 and 7 of the amended statement of claim would also support. A person paying an itemized invoice usually does so in the belief that the goods and services listed have been provided.

[9] Where someone has paid money under a contract but got nothing in return, there is a very old and well-established cause of action for return of the money for failure of consideration. The defendant may have a defence if the failure is partial and not total, but that defence may not work, and the plaintiff may win, if the parts of the consideration are separate or severable, or if the defence otherwise is unjust . The law is developing here. See 1 Chitty on Contracts , paras. 29-062 and 29-063 (pp. 1671-72) (29th ed. 2004).

A shrinking defence is no ground to strike out a statement of claim. (emphasis added) The Court held that the breach of contract claim could succeed, assuming the truth of the facts as pleaded, because the subscribers would otherwise be paying for nothing. The unjust enrichment claim could succeed, on the basis of an enrichment and corresponding deprivation in the absence of a juristic reason for the enrichment, and might succeed as money paid under a mistake of fact, or for the return of money paid for either total or partial failure of consideration.

Following the decision of the Northwest Territories Court of Appeal, the plaintiffs applied for certification: Anderson v. Bell Mobility Inc. , 2010 NWTSC 65 , [2011] 2 W.W.R. 106. Veale J. certified the action as a class action on the basis of both causes action. [ 34 ] Some of the Appellants assert that the alleged “wrongfulness” of the Appellants’ enrichment from the collection of the “system access fees” in this case is grounded entirely on the existence of the other causes of action pleaded in the Amended Statement of Claim and not sustained by Gerein J.

It is said that the cause of action in unjust enrichment is “derivative” of the other causes of action, and therefore must fail as they did. The argument comes from the Respondents’ pleading regarding “unjust enrichment.” For ease of reference, I will repeat the paragraph of the Amended Statement of Claim, putting forward a cause of action in “unjust enrichment”: 155a.

By engaging in the acts and conduct described herein, the Defendants unjustly enriched themselves and deprived class members of a fair market place, as well as financially deprived members of the class and causing the Plaintiff class to suffer economic harm. Amongst other things, the Defendants received an unjust enrichment by reason of their additional charges of "system access fees", "system licencing charges", "system licence administration fees" or similarly described fees or charges, and the Plaintiffs have suffered a corresponding deprivation.

There is no juristic reason for the benefit or enrichment of the Defendants. The Plaintiffs claim that as a result of the Defendants imposing additional charges on their customers' accounts as system access fees, the Defendants have unjustly benefited from payment of these charges by the Plaintiffs. The Plaintiffs claim for restitution of these monies unjustly charged and received by the Defendants.

The cause of action in unjust enrichment is said to be derivative of the other causes of action because of the opening words “by engaging in the acts and conduct described herein.” Since Gerein J. found those very same acts and conduct did not give rise to a claim in those other causes of action, he should have found, so the argument goes, that there could be no cause of action in unjust enrichment. [ 35 ] In my view, this argument is misconceived for two reasons, each of which is conclusive on this point.

First, it is clear that the argument for unjust enrichment in this case is based, primarily, on the stand alone, non-derivative form of the action discussed above based on decisions such as Garland i.e., on allegations that the Appellants have gained a benefit at the expense of the Respondents in the absence of a juristic reason justifying the enrichment. The pleadings do not suggest the contrary. Paragraph 155a mentions “the acts and conduct described herein”, not the “causes of action” pleaded above.

This paragraph is reasonably read as pleading unjust enrichment as an independent cause of action, not merely as a remedy sought in relation to other causes of action pleaded. [ 36 ] Second, however, it is important to recognize that the decisions of Gerein J. regarding other potential causes of action are of limited import on this appeal.

It is true that he refused to certify this class action on the basis of causes of action in breach of contract, breach of the duty to inform, deceit, misrepresentation and negligence, collusion, breach of fiduciary obligation or violation of competition and consumer legislation. He held in each case that the pleadings failed to disclose a reasonable cause of action. It is important to underscore, however, that he did not strike any of the allegations of fact in the Amended Statement of Claim and he clearly did not make any findings of fact in relation to those allegations.

In particular, he made no finding at all, and certainly no finding binding on this Court on this appeal, to the effect that the cellular service contracts at issue in this proceeding were not breached when the Appellants retained the “system access fees” collected for their own use rather than paying them over to a third party.

Nor, in refusing the claim for deceit or misrepresentation, did he strike the allegations that the Appellants had consistently described the fees at issue in terms to suggest that they were fees imposed by a third party, or make any finding at all as to the accuracy of those allegations. [ 37 ] The Respondents did not appeal the decision of Gerein J. in relation to these other proposed causes of action and, therefore, the question of whether his decision in that regard was correct is not before this Court.

What is before us is the question of whether the allegations in the statement of claim are sufficient to meet the test of authentic and plausible cause of action in unjust enrichment. If we conclude that they are, then it is irrelevant, in my respectful view, whether or not our reasoning might also have supported some of the other causes of action rejected by Gerein J.

In short, the question before us is whether the conclusion of Gerein J. that the pleadings support a cause of action in unjust enrichment is correct—not whether it is necessarily consistent with other conclusions he came to that are not before us. [ 38 ] When the Respondents reapplied to have the action certified as a class action based on a new representative plaintiff and an expanded litigation plan, one of the Appellants raised the issue as to whether a class action could be certified in relation to unjust enrichment as such a claim was based on the other causes of action, notably fraud and misrepresentation.

Gerein J. gave short shrift to the argument: [17] The second argument is that the plan is unworkable because there is no way in which the plaintiffs can establish an unjust

enrichment. It is said that the plan is an attempt to circumvent the earlier ruling rejecting the claims based on fraud andmisrepresentation. [18] It may happen that the plaintiffs cannot prove unjust enrichment. However, that is not to be determined at this stage of theproceedings. The plaintiffs must be afforded an opportunity to prove their claim and only then will it be determined whether or not theclaim is valid. (2007 SKQB 328, emphasis added) I am in complete agreement with that conclusion.

In short, the claim in unjust enrichment does not depend on the other proposed causesof action being certified for the purposes of the class action, although the facts underlying those causes of action may be relevant asmatters proceed. [39] The certification judge committed no error in concluding that the allegations in the statement of claim were sufficient to support aclaim in unjust enrichment for the purpose of s. 6(

a) of the Act. I recognize that Gerein J. did not speak in terms of whether there was “anauthentic or plausible cause of action.” He used the words “reasonable cause of action” and applied the “plain and obvious” test fromHunt v. Carey Canada Inc., (SCC), [1990] 2 S.C.R. 959 at 980. I am satisfied that nothing turns on this. His decisionpre-dated our decision in Hoffman, supra. I have determined that the test of authentic cause of action has been met in this case. 3. Did Gerein J. err by determining there is an “identifiable class” as required by s. 6(

b) of the Act and by finding thecommon issues he identified were indeed “common issues” as required by s. 6(

c) of the Act? [40] Clauses 6(

b) and (

c) require that there be an identifiable class and that the claims of the class members raise common issues.“Class” is defined in s. 2 of the Act to mean “two or more persons with common issues respecting a cause of action or a potential causeof action.” It is, therefore, apparent that the question of whether there is an identifiable class and the question of whether the cause orcauses of action raise common issues, while distinct, are inter-related. [41] As previously indicated, Gerein J. fixed the class as follows: ...

All residents of Canada who have purchased wireless services from any of the defendants since April 1, 1987 and paid a feevariously described as a (sic) “system access fees”, “system administration fees”, “license administration fees” or “system licenseadministration fees.” (2006 SKQB 328 at para. 56) [42] Class action jurisprudence has established that the purpose of the class definition is to identify individuals entitled to notice, toidentify those entitled to relief, if awarded, and to identify those bound by the judgment.

In Western Canadian Shopping Centres v.Dutton, 2001 SCC 46, [2001] 2 S.C.R. 534, the Court concluded those objectives dictate that the definition use objective criteria, whichbear a rational relationship to the common issues asserted by all class members, and that the criteria not depend on the outcome of thelitigation. The second requirement has been associated with a prohibition against overly inclusive class

definitions that includeindividuals who have suffered no loss or injury and could not have a cause of action against the defendant(s). [43] While the application of these criteria has proven to raise substantial difficulties in many cases, most of those do not arise in thiscase. The criteria for class membership in the within case are objective, they do bear a rational relationship to the cause of actioncertified in this case, and the class description includes all and only those who might have a cause of action against the defendants in thisregard.

Accordingly, the only issue that arises in relation to this definition is whether the members of this class have common issues.This, of course, leads to a consideration of s. 6(c). [44] I should add that an evidential basis has clearly been provided to substantiate the existence of the class as defined. On April 1, 1987,the regulatory regime for cell phone use changed in Canada. Before April 1, 1987, the Government of Canada required cell phone usersto pay a “fee” directly to it. On April 1, 1987, this requirement was changed, but the Appellants were required to pay a form of alicensing fee to the Government.

Subsequently, all the Appellants began at some point to charge “system access fees” to certain of theircustomers, all of whom are differentiated from other customers not in the class by the obvious fact of being charged a system access fee. [45] As indicated, the common issues fixed by Gerein J. are as follows: (1) whether the defendants wrongfully collected from the plaintiffs certain fees variously described as "system access fees", "systemadministration fees", "license administration fees" or "system license administration fees" and must now account for those fees; and (2) what is the amount of the loss sustained based on the fees collected if an accounting is to be made (2006 SKQB 328 at para. 65).

[ 46 ] The position of the Appellants is that it is not possible to identify an appropriate class or a common issue because of: (

i) the sheer number of cell phone users and contracts; (ii) the variation among the contracts; and (iii) the presence of multiple defendants.

Further, the Appellants argue that a common issue, based on “wrongfulness,” is so vague as to be meaningless and, if sustained, will amount to a fishing expedition. [ 47 ] In order to address those issues, it is necessary to begin with a consideration of whether the common issues selected by Gerein J. can be sustained as drafted and, if not, whether they can be varied to capture the essential ingredients of the cause of action in unjust enrichment in such a manner that they are common not only to the myriad of plaintiffs, but also to the six defendants. [ 48 ] I agree with the Appellants that the reference to “wrongfulness,” in the first common issue identified by Gerein J., is possibly somewhat vague.

In Rumley v. British Columbia , 2001 SCC 69 , [2001] 3 S.C.R. 184 at para. 29 , Chief Justice McLachlin stated that it does not serve the ends of fairness or efficiency to certify an action "on the basis of issues that are common only when stated in the most general terms." In Parsons v.

Coast Capital Savings Credit Union , 2007 BCCA 247 , leave to appeal to S.C.C. refused, [2007] 3 S.C.R. vii, Justice Newbury, relying on Rumley , redrafted the questions to better reflect the nature of the cause of action in unjust enrichment. [ 49 ] However, it is apparent from the previous discussion in relation to the certified cause of action that the “wrongful” conduct alleged in this case must relate to the cause of action identified in unjust enrichment and can easily be defined more precisely.

The claim in unjust enrichment is essentially a claim that the defendants collected from the class members fees variously described as “system access fees”, “system administration fees”, “license administration fees” or “system license administration fees”; that the defendants retained all or a large part of the fees collected for their own use and did not pay them over to a third party; and that the contracts properly interpreted did not authorize this retention. [ 50 ] This, really, is no more than a clarification of what is meant by the word “wrongfully” in the common issue as certified by Gerein J. and would not, in my view, require an amendment by this Court.

It is clear that only one cause of action has been certified. While this is a matter more properly left to the management of the class action, it may be that a slight amendment to the first identified common issue would be desirable to insure against the “fishing expedition” the Appellants fear. Two possible amendments to consider would be:

(1) Did the collection of fees by the defendants from the plaintiffs variously described as "system access fees", "system administration fees", "license administration fees" or "system license administration fees" constitute unjust enrichment of the defendants by the plaintiffs and entitle the plaintiffs to recovery of all or part of the fees paid? Or,

(2) Did the defendants collect from the plaintiffs fees variously described as "system access fees", "system administration fees", "license administration fees" or "system license administration fees" and retain all or part of those fees for their own use although the contracts between the plaintiffs and the defendants, properly interpreted, did not provide a juristic reason for the defendants’ enrichment at the expense of the plaintiffs in this respect?

I would leave the refinement of this common issue to the class action management judge. [ 51 ] While the common issues defined in this suggested way, particularly in the second option, seem a bit cumbersome, there does not seem to be any real issue between the parties as to whether the fees in question were charged. In fact, the class is defined as persons who were charged such fees.

Thus, the sole issue that divides these parties is whether the contracts, properly interpreted, represented these fees as government taxes or fees collected on behalf of a third party, or whether they should be interpreted as permitting the defendants to retain the fees as part of the consideration for providing cellular telephone service to the plaintiffs. If the latter, the contracts constitute a juristic reason justifying the defendants’ retention of the fees paid and would defeat the unjust enrichment claim.

If the former, they would not. [ 52 ] However, the fact that the common issue really comes down to a question of contract

interpretation raises a second set of concerns: that there are six different defendants all of whom employed distinct contracts that differed to some extent over the period of time at issue. Thus, it could be said, the issue cannot be common to all members of the class, for the answer to what might be the proper

interpretation of the clause permitting collection of these fees in respect of one contract might not be the same for the clause permitting such collection in another contract. [ 53 ] Again, the decision in Rumley is of some assistance in this regard. It should be noted that Rumley is particularly relevant to the Saskatchewan context. [ 54 ] The Court in Rumley was asked to consider s. 4(1) (

c) of British Columbia’s Class Proceedings Act , R.S.B.C. 1996, c. 50, which is

the same as s. 6 (

c) of Saskatchewan’s Class Actions Act : 6 The court shall certify an action as a class action on an application pursuant to

section 4 or 5 if the court is satisfied that: … (

c) the claims of the class members raise common issues, whether or not the common issues predominate over other issues affecting individual members ; [emphasis added] The emphasized portion does not exist in Ontario (the province of origin of Hollick v. Toronto (City) , supra )—a factor noted in Rumley , which prompted the Court to say: [33] ... I question the extent to which differences between the class members should be taken into account at this stage.

The British Columbia Class Proceedings Act explicitly states that the commonality requirement may be satisfied "whether or not [the] common issues predominate over issues affecting only individual members": s. 4(1) (c). (This distinguishes the British Columbia legislation from the corresponding Ontario legislation, which is silent as to whether predominance should be a factor in the commonality inquiry.) While the British Columbia Class Proceedings Act clearly contemplates that predominance will be a factor in the preferability inquiry (a point to which I will return below), it makes equally clear that predominance should not be a factor at the commonality stage.

In my view the question at the commonality stage is, at least under the British Columbia Class Proceedings Act , quite narrow . ( Rumley , emphasis added) Further insight into the degree of specificity or acceptable difference inherent in a proposed common issue can be gained from the application of the above principles to the class action in Rumley .

A class action was certified in Rumley notwithstanding a changing standard of care over the period of 42 years spanned by the allegedly wrongful conduct. [ 55 ] The development of the common issues must balance a number of broadly defined principles regardless of the legislative base chosen. The need to provide sufficient detail to prevent the common issues trial from devolving into a series of individual issues is one imperative.

A second imperative is that an appellate court must be mindful of the considerable leeway given to the class action judge to continue to develop and refine the issues, to create sub-classes and ultimately to decertify the action if need be. [ 56 ] In a series of decisions, all written by McLachlin C.J. in the same year, the Supreme Court of Canada provides this guidance with respect to the development of the common issues: (

i) the resolution of the common issues need not be determinative of each class member's claim: Dutton, supra ; (ii) success for one member must mean success for all in relation to the common issues: Dutton at para. 40 ; (iii) all members of the class must benefit from the successful prosecution of the action, although not necessarily to the same extent: Dutton at para. 40 ; (iv) the representative plaintiff need not show that everyone in the class shares the same interest in the resolution of the asserted common issue: Hollick , supra at para. 21 ; (

v) a court should avoid framing commonality between class members in overly broad terms as inevitably such an action would ultimately break down into individual proceedings: see: Rumley , supra at para. 33 ; (vi) there must be some basis in fact for the common issues: Hollick , at paras. 25-26 ; (vii) a court may find it necessary in certain cases to provide a nuanced answer to a common issue: Rumley at para. 32 ; and (viii) differences among class members should not be taken into account at the commonalty stage, but should be considered instead in the context of determining the preferability of the class action over other methods of resolving the dispute as part of considering whether individual issues will overwhelm common issues: Rumley at para. 33 . [ 57 ] Rumley concerned institutional neglect and allegations of systemic sexual abuse at a government-run school.

The following common issues survived certification and the appeal to the British Columbia Court of Appeal: 1. Was the defendant negligent or in breach of fiduciary duty in failing to take reasonable measures in the operation or management of the school to protect students from misconduct of a sexual nature by employees, agents or other students at the school? 2. If the answer to common issue no. 1 is "yes", was the defendant guilty of conduct that justifies an award of punitive damages? 3. If the answer to common issue no. 2 is "yes", what amount of punitive damages is awarded?

The first common issue was the most contentious. The appellant-defendant argued that the standard of care would be inherently individualistic. Chief Justice McLachlin rejected this argument, noting that the allegations were of a systemic nature—policy and planning errors which created the environment in which the abuse could thrive.

There would need to be substantial individual inquiry for each claimant after the common issue was resolved, but the resolution of the common issue was essential to each member’s claim. [ 58 ] Since Rumley , numerous trial and appeal courts have plumbed the differences between the statement in Dutton , i.e., “success for one class member must mean success for all” in relation to the common issues, and the apparent qualification of that statement in Rumley , i.e., “the court may find it necessary to provide a nuanced answer to the common question” (at para. 32).

The issue has been how to reconcile the two statements. [ 59 ] With some exceptions, the emerging jurisprudential consensus permits a nuanced answer that may not lead to success for all

particularly where the claim spans a number of years and changing practices as exist in the case at bar. See: Andersen v. St. JudeMedical Inc. (2003), (ON SC), 67 O.R. (3d) 136 (Ont. Sup.Ct.) at para. 38; supplemental reasons (2004), 48 C.P.C.(5th) 312; leave to appeal refused (2005), 136 A.C.W.S. (3d) 799 (Ont. D.C.) (a varying standard of care in an action involving allegedlydefective prosthetic heart valves); Healey v. Lakeridge Health Corp. (2006), 38 C.P.C. (6th) 145 (Ont.

Sup.Ct.) at paras. 97-99(certifying a common issue related to the breach of the standard of care that might be different before or after a certain date); J.L.G. v. A.W.W., 2002 BCSC 1219, 23 C.P.C. (5th) 336 at paras. 19-21; aff’d 2003 BCCA 367, 34 C.P.C. (5th) 216 (certifying a common issuerelating to the standard of care the Province owed to children under its care, in light of the extensive abuse suffered by the class in their foster homes); Knight v.

Imperial Tobacco Canada Ltd., 2006 BCCA 235, 267 D.L.R. (4th) 579 at para. 27 (allowing a common issue inrelation to a breach of trade practices despite the fact that the defendants’ advertising would have changed over time); Cloud v. Canada(Attorney General) (2004), (ON CA), 247 D.L.R. (4th) 667 (Ont. C.A.), leave to appeal to S.C.C. refused [2005] 1S.C.R. vi (a varying standard of care involving similar institutional sexual abuse claims as Rumley); Reid v.

Ford Motor Co., 2003 BCSC1632 at paras. 45 and 49 (standard of care varying across 12 years of motor vehicle construction was not an obstacle to certification). Exceptions to this list are readily explainable. For example, in Merck Frosst Canada Ltd. v. Wuttunee, 2009 SKCA 43, [2009] 5W.W.R. 228, the diversity of claims was fatal to the certification. There were eight subclasses and a distinct lack of clarity in the causesof action put forward by the plaintiffs. The net result was that every single possible negative side effect from taking Vioxx would needto be analyzed separately.

Even a broad Harrington-like “unfitness” (or “defect”) question would fail to be common, because the defectsalleged were myriad, and would have differed in nature and degree (see Harrington v. Dow Corning Corp., 2000 BCCA 605, 193 D.L.R. (4th) 67). [60] Having regard for these authorities, the common issue requirement, “success for one is success for all”, may in appropriate cases bemet in circumstances where different results may be possible for different class members, provided there is no conflict among the classmembers, in the sense that success for one class member must not mean failure for another.

In arriving at that conclusion, I have foundthe comments of Slatter J. in Metera v. Financial Planning Group, 2003 ABQB 326 , [2003] 10 W.W.R. 367 at para. 54 to beparticularly helpful: [54] "Success for one is success for all" means that if one class member is successful on a common issue then either (

i) all other classmembers are also successful or (ii) some other class members are indifferent to that issue. What it means is that there are no "common"issues on which success for one member of the class means defeat for another, for then there is a conflict of interest in the class. To put itanother way, some common issues may only be common to a sub-class.

Of course, if all the issues are only "sub-class common" andthere are no "universally common issues", then a class proceeding will probably not be appropriate and the action should be severed....(emphasis added) Admittedly, these comments were made in a province that had not as yet enacted a Class Proceedings Act, but they are nonethelessapposite and appear to have formed the basis of the reasoning in much of the decisions on point. (See also Papaschase Indian Band No.136 v.

Canada (Attorney General), 2004 ABQB 655, [2005] 8 W.W.R. 442 at para. 220, varied in 2006 ABCA 392, [2007] 2 W.W.R.440, affirmed in 2008 SCC 14, [2008] 1 S.C.R. 372. Note that the Queen’s Bench granted

summary judgment for the defendants. Thesummary judgment was appealed to the Supreme Court, which overturned the Court of Appeal and restored the chambers judge’sdecision on the

summary judgment. The question that concerns us at this point of the analysis was not appealed.) [61] Nonetheless, as this Court held in Merck Frosst, a high degree of commonality in the issues defined as “common” in a class actionis clearly required. In the instant case, where the common issue is one of the proper

interpretation of the contracts authorizing thecollection of “the system access fees”, the question is whether commonality is possible in light of the fact that there are six proposeddefendants, each of which had its own contracts with its subscribers, and for each of which the contractual provisions to some extentvaried over time. The issue to which we must turn is whether these differences, all of which raise the possibility, at least theoretically, ofdiffering answers to the common issues for different class members, are sufficient to defeat the possibility of certification in this case. [62] I begin by noting that a common thread runs through all of Gerein J.’s fiats pertaining to: (

i) the common issues, (ii) the need for arepresentative plaintiff, (iii) whether Saskatchewan has territorial competence or should decline it and so on. As he said, “there is onecommon set of facts” among all of the Appellants (see: 2006 SKQB 328, para. 19). When Gerein J. found that Saskatchewan hasterritorial competence over Bell Aliant, he wrote: [10] …The cause of action which I have upheld in the certification application is that of unjust enrichment. The conduct alleged toconstitute that tort is common to all the defendants, including those who have brought this action.

While the conduct as pleaded cannotbe said to constitute a conspiracy, it is marked by commonality and one part of it did occur in Saskatchewan. (2006 SKQB 330,emphasis added) In essence, Gerein J. found, for the purposes of the certification hearing that, if the Appellants did not act in concert, they acted intandem. [63] Some sense of this is gleaned from the Respondents’ pleadings in relation to collusion: Collusion …

139. The Plaintiffs have suffered injury, economic loss, and damages caused or materially contributed to by the collusion and civilconspiracy of the Defendants, including but not limited to, having contemporaneously instituted an additional monthly fee normally of$6.95 per month, to all cellular customers accounts, under the guise or misrepresentation that this additional charge represented aGovernment tax. 140.

The Defendants (particularly the four largest Defendants) have used their dominance and quadropoly [sic] over the Canadiancellular market, as the largest providers of cellular and wireless service in Canada to collude and engage in inappropriate business andtrade practices, by having all collectively misled the Plaintiffs in contemporaneously instituting and maintaining additional charges,normally of $6.95 per month (or such similar charges as have been charged in the past by the Defendants over and above their standardrate plans, and commonly described as "system access fee" or "system licencing charge"), without properly disclosing or defining thesame or implying or expressing that the same are a Government fee, charge, or tax. … 142.

The Defendants colluded to establish and maintain by the misrepresentation perpetrated against their customers and the public,concerning the nature of their "system access fees” and "system licensing charges', and even once it became clear that their customersand the public had been left with a false impression, been misled, and misinformed by the Defendants, the Defendants refused to act oracted inadequately to properly inform their customers and resolve the misrepresentation that had occurred; including having steadfastlyrefused a suggestion by Industry Canada that they clearly identify on monthly statements to their customers that: "System Access Feesare neither required nor collected by the Government.

None of the Defendants have adopt [sic] such a statement clarifying the nature oftheir additional extra charges.

Further, the Canadian Wireless Telecom Association, a group established by and representing the largecellular providers (Bell, Telus, Rogers and Fido) has refused to provide a clarification on the issue of "system licensing charges" or·'system access fees." (emphasis added) [64] The Respondents allege that the Appellants “colluded” to charge the same fee and to give the impression that it was a necessarygovernment fee and that the Appellants “colluded” to maintain the charging of the fee in such a manner even in light of a governmentsuggestion that they do not do so.

Gerein J. found that the pleading of conspiracy was deficient, but in doing so he stated “[t]he most thatis done is to plead a contemporaneous billing of the system access fee” (2006 SKQB 328 at para. 39).

The fact that it is alleged theAppellants acted in similar ways will be relevant to the determination of whether they were entitled to charge and retain the systemaccess fees. [65] Class actions have been certified against multiple defendants in somewhat similar circumstances in the following cases: Marcotte v.Fédération de Caisses Desjardins du Québec, 2009 QCCS 2743 (multiple defendants sued by the same plaintiffs alleging wrongfulnessin the collection of a fee charged on credit card transactions in foreign currencies); Ayrton v.

PRL Financial (Alta.) Ltd., 2005 ABQB 311, [2006] 2 W.W.R. 536 (aff’d, 2006 ABCA 88, 265 D.L.R. (4th) 240) (a “payday loans” case against four defendant companies andtheir principals); Collette v. Great Pacific Management, 2003 BCSC 332; refusal to certify overturned by the British Columbia Court ofAppeal, 2004 BCCA 110; leave to appeal to the Supreme Court of Canada dismissed with costs, [2004] 3 S.C.R. viii (an action fornegligence and/or breach of duty in the provision of professional services, stemming from a failed investment in certain commercialdevelopments); 2038724 Ontario Ltd v.

Quizno’s Canada Restaurant Corp. (2008), (ON SC), 89 O.R. (3d) 252,refusal to certify reversed by the Divisional Court (2009), (ON SCDC), 96 O.R. (3d) 252, certification affirmed bythe Ontario Court of Appeal, 2010 ONCA 466, 100 O.R. (3d) 721, leave to appeal to S.C.C. refused [2011] 1 S.C.R. x (former Quiznofranchisees in Ontario allege that they have been charged exorbitant prices for food and other supplies they are contractually required topurchase for use in their restaurants); Parsons, supra (banking contracts that differed over time and across defendants); Bodnar v.

TheCash Store, 2005 BCSC 1228 (QL), aff’d 2006 BCCA 260, [2006] 9 W.W.R. 41 “Bodnar #1” (plaintiffs were residents of BritishColumbia who had borrowed money from any Cash Store location in the province and had been charged what was alleged to be acriminal rate of interest); and Bodnar v. Payroll Loans Ltd., 2006 BCSC 1132 (different contracts and different, though related,defendants with different business models who provided payrol

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