Ontario Court of Appeal says provincial bill stands in Telus class-action suit

Ontario’s Court of Appeal dismissed an appeal by Telus Corp. in a class-action lawsuit, ruling that a now-defunct provincial wireless consumer bill was constitutional when it was operative during the class period of the lawsuit. In a decision dated Oct. 21, the Court of Appeal justices said Telus did not bring any new arguments to the table, or raise any identifiable errors, regarding the Superior Court’s ruling that the 2013 Wireless Services Agreement Act (WSAA) was within provincial legislative jurisdiction and was not in conflict with federal legislation. The WSAA was an Ontario consumer protection bill that came into force in 2014 and was repealed in 2019 by the provincial Conservative Party. It was designed to complement the CRTC’s wireless code of conduct. The Court of Appeal also dismissed Telus’ alternative submission that the lawsuit should be stayed so the CRTC can determine whether the plaintiff is entitled to a refund, noting that the WSAA is valid. The CRTC and the Ontario and federal governments did not intervene in the proceedings. Costs to the respondent remain fixed at the agreed amount of $65,000, according to the decision. Plaintiff Marjorie Nelson sued Telus on behalf of the company’s non-business customers who cancelled their wireless service agreements between Jan. 6, 2016, and Oct. 1, 2018. Nelson alleged that the class members from across Canada were entitled to pro-rated refunds of prepaid charges because they were overcharged contrary to the Telecommunications Act and the CRTC’s Wireless Code, as well as the WSAA. Under the WSAA, if a “consumer cancels a wireless agreement, whether it is for a fixed term or no fixed term, the supplier shall not charge the consumer any fee, charge, penalty, interest or other amount.” In response to Nelson’s motion, Telus launched a cross-motion arguing that the WSAA was ultra vires, meaning Ontario had no power to enact the bill because telecommunications legislation is a matter of exclusive federal jurisdiction. The company also argued that if the court found the bill to be valid, then the WSSA would be “inoperative under the doctrines of paramountcy and interjurisdictional immunity,” meaning that the federal legislation would prevail in the case where two similar laws intersect. “Telus submits that the Wireless Services Agreement Act, 2013 was a colourable attempt by Ontario to exercise authority over the telecommunications industry,” Telus argued to the court in Dec. 2020, according to the documents. In the decision dated Jan. 12, 2021, an Ontario Superior Court of Justice found that Nelson had a certifiable class-action to advance a claim under Ontario’s WSAA but not a national class-action claim under the Wireless Code of the Telecommunications Act. According to the Constitution Act in each province legislature may develop laws in relation to matters such as telegraphs (which includes telephones and all types of wireless communication) and generally all provincial matters of a local or private nature. The justice, therefore, found that Ontario’s statute was not a matter of telecommunications as it fell within provincial authority regarding matters of trade, civil rights, and local issues. “Subject to the regulation of the CRTC, Telus can build its network, conduct financial planning. and decide what it charges for its wireless services. While the Wireless Services Agreement Act, 2013 regulates the contractual aspects of how the wireless service provider carries on business, it does not interfere with Telus’ rights to charge rates pursuant to the regulatory regime of the Telecommunications Act or pursuant to the forces of the marketplace where the CRTC forbears from setting a rate or tariff,” the justice wrote in January. In regard to Telus’ paramountcy argument, the justice wrote that “the mere fact that the federal government and a provincial government have legislated about the same matter does not create a conflict.” The jusice noted that when the WSAA was introduced, refunds were required for Ontario consumers who cancelled their wireless service agreements. However, it was not clear until 2016 how the CRTC’s Wireless Code dealt with refunds when a service was cancelled. In 2016, Telus applied for a review of the commission’s decision and asked for an extension of time to implement the decision. In 2018, the commission held that Telus was required to pro-rate charges and refund customers for the number of days remaining in a billing cycle for existing and new contracts cancelled on or after Oct. 1, 2018. It did not stipulate what to do with the refunds for the contracts cancelled before that date. The justice, therefore, reasoned that there was no operative inconsistency between the WSAA and the Wireless Code, because the CRTC did not order Telus not to pay refunds. -- Reporting by Jenna Cocullo at jcocullo@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca.

Ontario Court of Appeal says provincial bill stands in Telus class-action suit

News | October 25, 2021

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Ontario Court of Appeal says provincial bill stands in Telus class-action suit

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