Mandy Evans Applicant/Respondent (Plaintiff) v. General Motors of Canada Company, 2023 SKCA 86

Court of Appeal for Saskatchewan Docket: CACV3415 Neutral Citation: Evans v General Motors of Canada Company , 2023 SKCA 86 Date: 2023-08-09 Between: Mandy Evans Applicant/Respondent (Plaintiff) And General Motors of Canada Company and General Motors LLC Respondent/Appellant (Defendants) Before: Schwann, Kalmakoff and Drennan JJ.A. Disposition: Application dismissed Written reasons by: The Honourable Madam Justice Schwann In concurrence: The Honourable Mr.

Justice Kalmakoff The Honourable Madam Justice Drennan On application from: 2019 SKQB 98 , Regina Application heard: April 12, 2023 Counsel: Anthony Merchant, K.C., and Anthony Tibbs for the Applicant Kenneth Ready, K.C., and Robert Bell for the Respondent Schwann J.A. I. INTRODUCTION [ 1 ] The applicant, Mandy Evans, applies pursuant to Rule 59(1) of The Court of Appeal Rules for leave to adduce evidence to aid in her response to an appeal brought by General Motors of Canada Company and General Motors LLC [collectively, General Motors] from a decision made by a Queen’s Bench judge who certified Ms.

Evans’s claim as a multi-jurisdictional class action: Evans v General Motors of Canada Company , 2019 SKQB 98 , [2019] 10 WWR 725 [ Certification Decision ]. [ 2 ] The proposed evidence consists of seven affidavits. Given its breadth, and the likelihood that the parties may need to tailor their submissions if Ms. Evans’s application is granted, the panel hearing this appeal determined that the most expeditious course was to first hear and determine Ms.

Evans’s application, with the appeal hearing on its merits to follow shortly thereafter on a date to be scheduled by the registrar’s office. [ 3 ] I conclude the application must be dismissed. These are my reasons. II. BACKGROUND [ 4 ] In December of 2015, Mandy Evans launched a proposed multi-jurisdictional class action against General Motors on behalf of all persons in Canada who had purchased or leased a 2011 or newer Chevrolet Cruze automobile manufactured by General Motors. In her claim, Ms.

Evans asserted that General Motors had breached various common law and statutory duties in designing, manufacturing, marketing and selling the Cruze automobile, thereby causing economic loss to the members of the proposed class. She claimed general, special and punitive damages, restitution and declaratory relief. [ 5 ] The defects alleged in Ms. Evans’s claim relate to the vehicle’s cooling system. She alleges that General Motors received numerous complaints related to the radiator, radiator hoses, water pump, heater core, thermostat housing, water pump seal and reservoir [the coolant systems] of the Cruze.

According to her claim, these defects result in performance problems such as overheating and low coolant warning lights staying on and the entry of noxious and foul-smelling emissions into the passenger compartment of the vehicle. [ 6 ] In April of 2019, the proposed action was certified as a class action pursuant to The Class Actions Act , SS 2001, c C-12.01 , for the following class: “All persons in Canada that purchased or leased a model year 2011–2015 or newer Chevrolet Cruze with a 1.4 L engine” ( Certification Decision at para 77(1)).

The following causes of action were articulated by the Queen’s Bench judge (at para 77): 3. The nature of the claims asserted on behalf of the class are as follows: (

a) Negligence in relation to the development, design and manufacture of the cooling system of the class vehicles, resulting in a defect in the cooling system; (

b) Unjust enrichment resulting from payment by class members for class vehicles which did not suffer from the defect in the cooling system and receiving vehicles which had the defect; (

c) Breach of statutory warranties imposed by The Consumer Protection and Business Practices Act and similar consumer protection legislation in other provinces by selling class vehicles that were not reasonably fit for their intended purpose, durable and of acceptable quality;

(

d) Waiver of tort. [7] The Queen’s Bench judge narrowed the common issues to be determined at trial for the general class to the following (atpara 77(5)): (

a) Did the cooling system in the class vehicles contain a defect relating to the water pump and/or the reservoir that could causeunreasonable leakage of engine coolant [defect]; (

b) If the answer to Issue No. 1 is “yes”, when did or should the defendants have known of the defect; (

c) Did the defendants breach statutory warranties pursuant to s. 16 or s. 19 of The Consumer Protection and Business Practices Act orsimilar legislation in other provinces or territories by selling class vehicles with the defect; (

d) Did the defendants breach a duty of care owed to class members by designing, developing or manufacturing class vehicles with thedefect? [8] General Motors was granted leave to appeal from the Certification Decision on September 11, 2019, and perfected its appealin December of 2019. For reasons that were not explained at the time of this application, Ms. Evans did not file her factum until Novemberof 2022. I mention this fact only because of the significant gap in time between the date of the Certification Decision and the appealhearing (of nearly four years) and how it played into Ms.

Evans’s present application. III. THE TEST TO ADDUCE EVIDENCE ON APPEAL [9] Ms.

Evans asserts that the principles governing an application to adduce evidence on an appeal from an interlocutoryprocedural motion, where no substantive rights have been determined or will be determined (e.g., a certification ruling), should be relaxed.In support of that proposition, she relies on the following jurisprudence from other jurisdictions: MacMillan Bloedel Ltd. v Mullin (1985), (BC CA), 66 BCLR 258; Chalmers v AMO, 2009 BCSC 689, rev’d 2010 BCCA 560, 13 BCLR (5th) 37 (but not on thispoint); and SLMsoft.com Inc. v Rampart Securities Inc. (Trustee of) (2005), (ON SCDC), 204 OAC 240 (Sup Ct (DivCt)). [10] A similar argument was raised in MacInnis v Bayer Inc., 2023 SKCA 37 [MacInnis].

Ms.

MacInnis had argued that the policyreasons encapsulated by the test set out in R v Palmer, (SCC), [1980] 1 SCR 759 [Palmer], are not relevant to an appealfrom a certification hearing and that applications brought in that context should be dealt with in a liberal and flexible way. [11] This Court rejected those arguments, citing its previous decision in Pederson v Saskatchewan (Social Services), 2016 SKCA142 at para 24, 408 DLR (4th) 661, leave to appeal to SCC refused, , and decisions from other jurisdictions thatinvolved appeals from orders made in the context of proposed class actions: see Harrison v Afexa Life Sciences Inc., 2018 BCCA 165 atpara 18, 9 BCLR (6th) 271, leave to appeal to SCC refused, , and T.L. v Alberta (Child Welfare and the Public Trustee),2013 ABCA 368 at paras 22–23, 561 AR 297.

In MacInnis, this Court emphasized that, when considering an appeal from a certificationruling, it is exercising an appellate role and not one of original jurisdiction: [30] This Court is exercising appellate jurisdiction, not original jurisdiction, when it considers an appeal from a certification decision. Thefact that this action aspires to be a class action does not convert this Court into a court of first instance that may receive additional evidenceas a matter of course and then, of necessity, consider the application afresh. That would be the effect of accepting Ms.

MacInnis’ssubmissions in relation to the inapplicability of the Palmer test. Such a finding would not respect the need for finality and certainty thatexists even within a proposed class action proceeding nor would it correspond with the proper role of this Court. Like virtually all types oflitigation, a party is expected to put their “best case forward on the first go around” at a certification hearing and should not expect to beable to conduct “litigation by instalment” (Bear v Merck Frosst Canada & Co., 2011 SKCA 152 at para 60, 345 DLR (4th) 152).

As notedby Ottenbreit J.A. in Pederson, an appeal is not an extension or “continuation of the certification hearing by a s. 16 judge” (at para 24). [12] Ms. Evans does not distinguish MacInnis or offer any reason why that decision should not be followed here.

Accordingly, herapplication for new evidence will be analyzed through the lens typically applied to applications of this nature, which was most recentlyaddressed by the Supreme Court in Barendregt v Grebliunas, 2022 SCC 22, 469 DLR (4th) 1 [Barendregt]: [29] Appellate courts have the discretion to admit additional evidence to supplement the record on appeal: Catholic Children’s Aid Societyof Metropolitan Toronto v. M.(C.), (SCC), [1994] 2 S.C.R. 165, at p. 188; United States of America v. Shulman, 2001SCC 21, [2001] 1 S.C.R. 616, at para. 43. Whether in criminal or non-criminal matters (May v.

Ferndale Institution, 2005 SCC 82, [2005]3 S.C.R. 809, at para. 107), courts have typically applied the four criteria set out by this Court in Palmer when parties seek to adduceevidence on appeal: (

i) the evidence could not, by the exercise of due diligence, have been obtained for the trial (provided that this general principle will not beapplied as strictly in a criminal case as in civil cases); (ii) the evidence is relevant in that it bears upon a decisive or potentially decisive issue; (iii) the evidence is credible in the sense that it is reasonably capable of belief; and (iv) the evidence is such that, if believed, it could have affected the result at trial. [30] Palmer applies when evidence is adduced on appeal “for the purpose of asking the court to review the proceedings in the courtbelow”: Shulman, at para. 44.

Palmer does not, however, apply to evidence going to the validity of the trial process itself (R. v. Taillefer,2003 SCC 70, [2003] 3 S.C.R. 307, at paras. 76–77), nor to evidence adduced “as a basis for requesting an original remedy in the Court ofAppeal”, such as a stay of proceedings for an abuse of process (Shulman, at paras. 44–46).

See also Abbot Laboratories, Ltd. v Spicer , 2023 SKCA 55 at para 18 . [ 13 ] The Supreme Court in Barendregt went on to provide additional comments on how the test should be applied, noting as follows: “The Palmer test is purposive, fact-specific, and driven by an overarching concern for the interests of justice” and “ensures that the admission of additional evidence on appeal will be rare, such that the matters in issue between the parties should ‘narrow rather than expand as the case proceeds up the appellate ladder’” (at para 31, quoting Public School Boards’ Assn. of Alberta v Alberta (Attorney General) , 2000 SCC 2 at para 10 , [2000] 1 SCR 44). [ 14 ] To conclude on this part, I will apply the Palmer test in considering whether to admit Ms.

Evans’s proposed evidence on appeal. IV. EVIDENCE SOUGHT TO BE ADDUCED ON APPEAL [ 15 ] As noted, the proposed evidence consists of seven affidavits, sworn in February of 2023. Six of them were sworn by members of the class who own or owned a Cruze automobile. I provide a brief synopsis of those affidavits: (

a) Lena Azzalini – Ms. Azzalini describes a coolant problem she experienced in 2018, which was covered by warranty, and another similar problem that she paid to repair. (

b) Sandra Hall – Ms. Hall deposed to having experienced recurrent stalling and overheating problems on numerous occasions with her Cruze vehicle. Although most of the costs associated with those issues were covered by warranty, she incurred expenses for vehicle rental, the deductible on the warranty and the cost of further diagnostic testing. In 2021, she replaced the radiator cooling housing unit. (

c) Daniel Husbands – Mr. Husbands describes similar problems with the coolant system of his vehicle as well as stalling. He says he observed smoking in the engine and a burning smell seeping through the vents. Some of the issues he experienced with his Cruze were covered by warranty, but, after it expired in 2018, he had to absorb any further repair costs. (

d) Valerie Jessome – Ms. Jessome describes a coolant problem she had in 2021. She incurred the cost of those repairs because the warranty period had expired. Ms. Jessome subsequently experienced a head gasket problem that led to the loss of her engine. She attributes those problems to the Cruze’s faulty cooling system. She attached receipts for those expenses. (

e) Hayley Steele – Ms. Steele experienced overheating issues and engine concerns relating to the coolant system. Among other things, she says these problems led to the replacement of the head gasket and a leaking water pump. Most of those expenses were covered by warranty. She deposes that she continued to experience a multitude of problems with the vehicle, such as stalling, overheating and an assortment of strange noises. In 2020 she had an engine fire. (

f) Lorelei Strand – Ms. Strand also experienced coolant leaks and water pump issues. Some of these issues were covered by warranty but others were not. She believes the coolant hoses on the Cruze are substandard and break down easily. [ 16 ] The seventh affidavit is sworn by Nadine Covill, who is a paralegal with the Merchant Law Group LLP. She avers that, although there has been no advertising about the issues or the fact that the action was certified, 249 people have contacted Merchant Law Group to express interest in the class action. V. APPLICATION OF THE PALMER TEST [ 17 ] As I will discuss, Ms.

Evans’s proposed new evidence does not meet the test for admission under Palmer. In short, this is because it fails to satisfy the due diligence criterion. A. Due diligence [ 18 ] The first branch of the Palmer test asks whether, with the exercise of due diligence, the applicant could have adduced the proposed evidence at trial or, in this case, at the certification application. In addressing this question, an appellate court must consider what was in issue in the original hearing. In the present matter, one of the live issues at the certification hearing, as it will be on appeal, was whether Ms.

Evans’s claim in negligence should be certified given that the only loss outlined in her pleadings was for diminution in value, the cost of repairs and other consequential expenses that the Queen’s Bench judge described as claims “for pure economic loss” ( Certification Decision at para 33). [ 19 ] General Motors contends the proposed new evidence fails to meet the requirement for due diligence because it is all evidence that Ms.

Evans had available to her at the time of the certification hearing, and it all relates to the question of whether the class of plaintiffs suffered any form of compensable harm, apart from pure economic loss. General Motors submits that this issue was front and centre at the certification hearing, and, as such, Ms. Evans’s failure to lead evidence to address that issue was anything but diligent. [ 20 ] Ms.

Evans, on the other hand, asserts that, at the time of the certification hearing, she could not have anticipated that General Motors would argue on appeal that the law had changed such that a plaintiff in a certification application must provide proof of damages beyond pure economic loss. In this respect, Ms. Evans contends that the law has not changed since the certification hearing but, if this Court finds that the law has changed, that amounts to a development that she could not have foreseen, meaning her failure to lead that evidence cannot be seen as a lack of due diligence.

[21] Having regard to the parties’ arguments filtered through the recent refinement of the Palmer test in Barendregt, I find myselfunpersuaded by Ms. Evans’s due diligence submissions. Let me illustrate why that is so. [22] Given the state of the pleadings at the time of the certification application, General Motors argued that the law did not permit aparty to claim for pure economic loss against a product manufacturer.

The Queen’s Bench judge, relying on Winnipeg CondominiumCorporation No. 36 v Bird Construction Co., (SCC), [1995] 1 SCR 85 [Winnipeg Condominium], found that anexception to that general principle may operate to permit claims for pure economic loss against a manufacturer of defective materials thatpose a real and substantial danger.

In that regard, the Queen’s Bench judge also drew support from Sorotski v CNH Global N.V., 2007SKCA 104, [2008] 1 WWR 386, leave to appeal to SCC refused, , which he found demonstrated “the application of this‘dangerous goods’ principle in a products liability case” (Certification Decision at para 34). [23] In the end result, the Queen’s Bench judge concluded that “[i]t is not necessary to decide whether, as suggested by [GeneralMotors], Winnipeg Condominium decided not only that a plaintiff can claim against a manufacturer of dangerous goods, but that a plaintiffcannot claim against the manufacturer in negligence for economic loss if the goods are not dangerous” (emphasis in original, at para 35).However, he also stated that, had it been necessary to decide this question, he “would have found that Winnipeg Condominium did notresolve the issue” (Certification Decision at para 36).

He identified some debate in the jurisprudence about the direction in which thisissue might move, ultimately allowing the claim to proceed based on this uncertainty. [24] With this backdrop in mind, General Motors submits that the proposed new evidence cannot be admitted. It says the affidavitsMs. Evans seeks to adduce relate to vehicle concerns and repairs that occurred as early as 2014 – five years before the CertificationDecision – and, therefore, this information was or should have been available to her at the time of the certification hearing. Simply put,General Motors asserts that there is no reason why Ms.

Evans could not have tendered this type of evidence at the time of the certificationhearing. Additionally, General Motors argues that, contrary to Ms. Evans’s position, the law is neither new nor reasonably unanticipated:“While the issue of evidence of compensable harm has been the subject of much discussion in recent case law, courts have recognized thatthis requirement is, in fact, a longstanding and fundamental principle of class action certification”. [25] In her written submissions, Ms.

Evans maintains that pure economic loss continues to be recoverable: “if the Court [on appeal]deemed it otherwise, based on the new affidavits, the certification would be maintained on the basis of the class having suffered otherdirectly compensable losses”. In other words, I take her to say that if the law has changed since the time of certification, such that affidavitevidence of compensable harm is required to satisfy the some basis in fact criterion for certification, the due diligence requirement shouldbe relaxed in order to permit the admission of the proposed evidence. Ms.

Evans points to this Court’s decision in Bouvier v Bouvier, 2020SKCA 133, leave to appeal to SCC refused, [Bouvier], which allowed new evidence to be adduced on appeal, eventhough it was in existence at the time of the application in the court below. [26] Even if I accept that in the time that has elapsed since the Certification Decision was rendered, some courts have taken anarrower view of a plaintiff’s right to recover for pure economic loss – a point that will undoubtably be assessed on the appeal proper – itdoes not follow that Ms. Evans’s new evidence application should succeed.

In analyzing the due diligence prong of the Palmer test, theSupreme Court in Barendregt emphasized that a court’s focus must be on the conduct of the party, not the result. The Supreme Courtreiterated that the due diligence requirement “ensures that litigants put their best foot forward when first called upon to do so” (at para 38)and that its purpose is to “safeguard the delicate balance between finality and order, and the interest in a just result” (at para 54).

The needfor finality and order, the Supreme Court said, “speaks to the profound unfairness in providing ‘a party the opportunity to make up fordeficiencies in [their] case at trial’” (at para 39, quoting Stav v Stav, 2012 BCCA 154 at para 32, 31 BCLR (5th) 302, leave to appeal toSCC refused, ) and to deter a “second kick at the can” (S.F.D. v M.T., 2019 NBCA 62 at para 24).

The Supreme Courtwent on to speak of the unfairness of one party being allowed to “fill the gaps in their trial evidence” and that the opposing party generallyshould “not have to relitigate an issue decided at first instance, absent a reviewable error” (Barendregt at para 39). [27] In Barendregt, the Supreme Court also noted that a rigorous approach to the due diligence criterion serves the purpose ofpreserving the distinction between trial and appellate courts and maintaining the judicial architecture: “Evaluating evidence and makingfactual findings are the responsibilities of trial judges.

Appellate courts, by contrast, are designed to review trial decisions for errors. Theadmission of additional evidence on appeal blurs this critical distinction by permitting litigants to effectively extend trial proceedings intothe appellate arena” (at para 40).

A similar point was made in MacInnis, where the Court said this: “The fact that this action aspires to be aclass action does not convert this Court into a court of first instance that may receive additional evidence as a matter of course and then, ofnecessity, consider the application afresh” (at para 30). [28] In short, the question of whether a party is able to pursue a claim in negligence against the manufacturer of a defective productfor pure economic loss was a live issue at the time of the certification hearing and could have been addressed by Ms.

Evans at that time.Although it is possible to the read the jurisprudence since the Certification Decision was rendered as having added clarity to the issue, I donot interpret it as having altered the law in any significant way in the context of the present application.

To the extent that there is anyuncertainty in the law in this respect, i.e., whether and to what degree the principles set out in Winnipeg Condominium could or would beextended to defects of a non-dangerous variety, that uncertainty also existed at the time of the certification hearing. [29] Given that the uncertainty in the law surrounding this point would have been known to Ms. Evans at the time of thecertification hearing, allowing her to bring forth evidence on appeal would amount to a second kick at the can that the Supreme Courtcautioned against in Barendregt.

While the law may have inched forward since the time of the certification hearing, the tenor of theCertification Decision and the parties’ briefs of law filed at that time demonstrate that the economic loss issue was front and centre. Thisleads me to conclude that, knowing a court might strike her claim for pure economic loss, it was incumbent upon Ms. Evans to put herbest foot forward by taking all appropriate steps, which included filing the necessary evidence to show some basis in fact for thecertification criteria that depended on the evidence. [30] Finally, Ms.

Evans’s reliance on Bouvier does not assist her. Bouvier sets out the correct test for the admission of newevidence, but the application of the test to the particular facts of that case lends itself to a different result. [31] To conclude, Ms. Evans has not persuaded me that she exercised due diligence on an issue that she most assuredly understoodwould be raised by General Motors at the time of the certification hearing. Having found Ms. Evans failed to exercise due diligence within

the meaning of the Palmer test, her application for new evidence must be dismissed. While that conclusion is a full answer to Ms. Evans’sapplication, for the sake of completeness I will go on to address General Motors’s second argument – that the proposed evidence lackscredibility. B. Credibility [32] For new evidence to be admitted, it must be “credible in the sense that it is reasonably capable of belief when viewed in thecontext of other evidence relevant to that issue” (Bent v Platnick, 2020 SCC 23 at para 66, [2020] 2 SCR 645). Ms. Evans submits that theaffidavits are factual and believable.

As she goes on to state, the proposed affidavits “will not be determinative of the individual claims ofthe respective affiants” because they are to be used for certification purposes, which will “not detract from any rights [General Motors]might have to challenge the evidence or the conclusions that might be reached on that evidence at the appropriate time of the individualissues resolution process”. [33] However, as General Motors points out, the proposed affidavit evidence is not only untested by cross-examination, but, if it isadmitted at this level of the judicial hierarchy, General Motors will be placed at a distinct disadvantage because of the lack of opportunityto (

a) investigate, test and respond to the proposed evidence or (

b) cross-examine the affiants. To illustrate its point, General Motorshighlights the lack of clarity around some of the affiants’ invoiced expenses: for example, whether those invoices relate to the coolantsystem issues or if they were eventually covered by warranty. As a bottom-line position, General Motors says that, in the absence of somemeans to test the proposed evidence, it is impossible to assess whether it is credible, and, without that assessment, the admission of thisevidence amounts to little more than a specious attempt by Ms. Evans to bolster her argument on appeal.

All told, says General Motors, itwill result in significant prejudice to its appeal. [34] The credibility criterion of the Palmer test focuses on the evidence sought to be adduced. It speaks to the “importance ofreaching a just result in the context of the proceedings” and is said to be “directly linked to the correctness of the trial decision and thetruth-seeking function of our trial process” (Barendregt at para 45).

Contrary to the due diligence prong, the focus of this part of thePalmer test is on the nature of the proposed evidence, as opposed to a party’s conduct: “The last three Palmer criteria require courts toonly admit evidence on appeal when it is relevant, credible, and could have affected the result at trial. … [E]vidence that falls short ofthem cannot be admitted on appeal” (Barendregt at para 4). [35] I am also mindful of the impact the admission of the proposed evidence would have on General Motors.

The Supreme Court inBarendregt spoke about this consideration in this way: [46] After a court has decided to admit evidence on appeal, it should remain mindful that the evidence has not been put to the test of cross-examination or rebuttal at trial, and the adverse party may not have had the ability to verify its accuracy: Lévesque, [2000 SCC 47] atpara. 25.

If the evidence is challenged or its probative value is in dispute, appellate courts may, among other things, provide the opposingparty an opportunity to respond, allow cross-examination of a witness, permit the submission of expert evidence in response to additionalexpert evidence, or remit the matter to the court of first instance: Lévesque, at para. 25; see also Child and Family Services of Winnipeg v.J.M.F., 2000 MBCA 145, 153 Man. R. (2d) 90, at para. 27; Children’s Aid Society of Windsor-Essex (County) v. B.(Y.) (2004), (ON CA), 5 R.F.L. (6th) 269 (Ont.

C.A.), at paras. 12 and 19. [36] As I read Barendregt and Palmer, an applicant seeking to adduce evidence on appeal is required to demonstrate that theevidence is “reasonably capable of belief” (at para 29 and at 760, respectively). However, given the vagaries that General Motors hasidentified in the affidavits (especially on the critical issue of whether something more than pure economic loss was suffered by theplaintiff here), there is no way to assess – at this late date and without meaningful input from General Motors – whether the proposedevidence meets that standard. By way of

summary, Ms. Evans bore the burden of satisfying the Palmer test, but, as noted, there is no wayfor the Court to assess whether the credibility prong of the Palmer test has been met. [37] That said, I have considered whether General Motors’s concerns can be allayed by permitting it to apply to adduce its ownevidence in response to Ms. Evans’s application or by allowing for cross-examination of the affiants. However, bearing in mind thatMs.

Evans seeks to adduce not one but seven affidavits, adopting this course of action would prolong the appellate process and upend ourrole as an appellate court, which is to examine the Certification Decision for error. VI. CONCLUSION [38] For the reasons expressed above, I am not satisfied that the proposed evidence clears the Palmer test. Ms. Evans’s applicationto adduce new evidence on appeal must, therefore, be dismissed. Costs in relation to her application may be spoken to at the time of theappeal hearing. “Schwann J.A.” Schwann J.A.I concur. “Kalmakoff J.A.” Kalmakoff J.A.

I concur. “Drennan J.A.” Drennan J.A.