3.31: Statement of defence

Case Summary

The Plaintiffs filed a prospective Class Action lawsuit against a host of cannabis industry companies. The Applicant Defendants, collectively applied for an Order deferring their obligations under Rule 3.31 to file Statements of Defence until after the Certification Hearing was heard and decided.

The normal rule is that Statements of Defence are due before the Certification Hearing. The Court cited Poundmaker Cree Nation v Canada, 2017 FCC 445 for principles guiding the Court for a decision to defer the filing of Defences. These principles are:

(a)               The decision is discretionary;

(b)               That discretion should balance flexibility with efficiency and fairness;

(c)                The burden of justifying the deferral lies on the Defendant; and

(d)               Factors to consider may include whether the Statement of Defence is helpful to the Certification process, the cost and time involved in filing Defences, the nature and complexity of the matter, and any prejudice to the Plaintiff.

The Court agreed with the Plaintiffs that the filing of Defences may assist the Plaintiffs and the Court in preparing for the Certification Hearing. The Court noted that Certification is not a decision on the merits of the claims and thus Defences may not be necessary to examine whether the Statement of Claim discloses a cause of action; however, the question is not whether Defences are necessary but whether they are likely to be helpful. The Defendants filed Affidavits for the Certification, but Affidavits are not pleadings and understanding the legal claims and defences may be helpful to the Court in analyzing the causes of action pleaded.

On the facts, the Court decided that the benefits of having complete pleadings outweigh the balance of work for the Defendants in drafting their Statements of Defence. To prepare their evidence for the Certification Hearing, the Defendants would have to formulate their defences, whether in the form of a filed pleading or not.

The Court dismissed the Defendants’ Application to defer filing of the Statements of Defence.

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