Why class-action lawsuits aren't always what abuse survivors hope for
Published Saturday, March 20, 2021 9:00AM EDT
TORONTO - Class-action lawsuits are a way for a group who has suffered similar damages to pursue justice collectively, instead of suing individually. Historically, they’ve worked well when it comes to defective car parts and food recalls, but some that have participated in the process question whether they actually work well in historic abuse cases.
Jim and Marilyn Dolmage were legal guardians in the Huronia class action, a lawsuit against the Ontario government for what happened at an institution for people labelled developmentally disabled.
We spoke to survivors, Pat Seth and Marie Slark, who described being locked in metal cages as children, not having privacy when they went to the bathroom, and even being physically and sexually abused by staff.
The stories are so horrific, Jim was surprised when their proposed $2 billion class action, settled for just $35 million.
“Nobody told us that in class actions in Canada 95 per cent of them never go to trial. Only five per cent go to trial,” Jim said.
It’s important to keep in mind that lawyers aren’t the only ones at the table. All class-action settlements in Canada are approved by judges and governed by a process set out in legislation.
Still, Marilyn was shocked to see how the $35 million was divided up.
“It's completely deceiving to talk about the $35 million because so much of it went to the lawyers, the class proceedings fund, expenditures and so on and couldn't be claimed by class members... pretty close to half went elsewhere. Let's put it that way,” she said.
In the cases involving Huronia, and two other institutions for children labelled developmentally disabled, Southwestern and Rideau Regional Centres, the total settlement was $67.7 million dollars. As approved by the court, the law firm Koskie Minsky made $14 million in legal fees. And while survivors received just over $37.5 million in total, the average payout to each survivor was around $11,000.
Koskie Minsky declined W5’s request for an interview but sent a five-page letter. In it, they point out that the courts recognize settlements as “a compromise that reflects the risks, delays and expense of continuing litigation.”
In the Huronia class action, the case management judge found that, “the settlement reflects the very real litigation risks the plaintiffs face if this matter proceeds to trial.” The same judge noted that, “given the advanced age of the class members and the historical nature of this litigation, the benefits of an immediate and certain settlement cannot be overstated.” The firm also noted that in the Huronia action, the process leading to the settlement “involved over nine days of mediation… with four different mediators… including three sitting judges…” And in Huronia, Southwestern and Rideau, up to “$7 million plus interest” would go to programs for people with disabilities.
There are other problems with these class actions that are being called into question by the Dolmage family. In several cases after Huronia, they’ve watched money unclaimed by survivors, returned to the defendants, in these cases, the Ontario government.
Jim Dolmage has been following payouts from class actions closely. In Rideau and Southwestern, he points out that, “a million and a half dollars wasn't claimed by survivors. So that went back to the government.”
Class actions in Canada have very specific rules. Class members are automatically added to the class action unless they opt out. That’s not the case everywhere around the world. In fact, according to the Director of the Class Action Clinic at the University of Windsor, Jasminka Kalajdzic, “more countries have opt-in processes than opt out. Almost all northern and western European jurisdictions have opt in.”
Also there’s a short window to claim money, so if class members miss the deadline, they’re too late. However, years later if they decide they’re finally ready to come forward and get compensation, they can’t. Survivors can’t personally sue again, once a class action is closed.
“Canada, the U.S., Israel, Spain and a few others have opt out,” Kalajdzic adds.
Koskie Minsky says that in all class actions, the law requires “robust notice be given of all stages of a class proceeding,” and are subject to “court approval.” Meaning a class action is monitored by judges and members are notified at every step.
Class-action legislation in Ontario is almost 30 years old. In 2019, the Law Commission of Ontario published a report questioning whether class actions were fulfilling their purpose of “access to justice, judicial economy, and behaviour modification.” Jasminka Kalajdzic was one of the lead researchers in that project.
The report came out with more than 40 recommendations to improve the class-action system. That includes reforming the Class Proceedings Act across a broad range of issues, including how a class action is started, settlement approval and the fees a law firm is allowed to charge.
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