Q2 2026: Five Noteworthy Ontario Class Action Decisions

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This quarter featured several Ontario decisions refusing stays of parallel and individual actions. Courts also considered competing approaches to the predominance test, allowed failure-to-warn and recall-notice claims involving allegedly flawed product designs to proceed and varied an unpaid costs award to make plaintiff’s counsel personally liable.

Parallel Class Action Not Stayed

In Yee v. Telus International (Cda) Inc., 2026 ONSC 3165, in considering the statutory factors laid out for stays, the court declined to stay a proposed Ontario global securities class action concerning alleged omissions about Telus’s developing AI products, despite a similar B.C. proceeding. The Ontario action was further ahead and likely to move faster, lowering the risk of inconsistent outcomes.

The decision offers a practical warning: adding more claims and defendants is not always helpful. Here, the B.C. pleading included oppression claims and directors who had not certified the impugned documents – features the court viewed as potentially burdensome and distracting.

Continuation of Individual Actions

Chisholm v. His Majesty the King in Right of Ontario, 2026 ONSC 3512, and Pavlioglu et al. v. FinanceIt Canada Inc., 2026 ONSC 1416, both refused stays of individual actions pending proposed class proceedings. In each case, prejudice to the resisting party was decisive.

In Chisholm, involving a motion to stay inmates’ actions for alleged retaliatory actions, delay was found to risk impairing evidence with passage of time and worsening plaintiffs’ financial, emotional, psychological and physical circumstances, given limited financial means for trauma treatment. In Pavlioglu, a motion to stay enforcement actions on loans for HVAC units, delayed enforcement would make recovery harder, weaken memory-based evidence about alleged misrepresentations and increase defaulting consumers’ debts beyond realistic recovery.

Predominance Test

The “predominance” test was debated in Chiang v. The Toronto Dominion Bank, 2026 ONSC 2013. TD argued, relying on Martin v. Wright Medical Technology Canada Ltd., 2024 ONCA 1, that Ontario’s amended certification test mirrors U.S. Rule 23 and calls for a standalone assessment whether the common issues are more “prevalent,” “important” and “substantial” than the individual issues, without considering the CPA’s objectives of judicial economy, behaviour modification and access to justice. 

The plaintiff relied on Banman v. Ontario, 2023 ONSC 6187, which takes a broader approach that considers those objectives. Because predominance was satisfied under either test, the court regrettably declined to decide between interpretations, finding any such analysis would be obiter.

Duty to Recall

In Pedersen v. Advanced Bionics LLC, 2026 ONSC 2239, the court allowed a novel duty-to-recall claim to proceed, along with negligent design and failure-to-warn claims, in a proposed class action involving cochlear implants. The defendant issued recall notices and advisories months after first learning of potential device failures.

The court rejected the argument that warnings or recall would be useless if the design was flawed, finding the pleaded facts supported early intervention to prevent further harm from gradually failing devices. It also noted that failure to warn may support punitive damages. While a standalone duty to recall has not yet been recognized, the claim should be tested on a full factual record rather than struck at the pleadings stage.

Class Action Counsel Liable for Costs

In Navaratnarajah v. FSB Group Ltd., 2026 ONSC 3314, the court noted that arrangements relieving the representative plaintiff of adverse costs exposure – through counsel or third-party funding – are standard in class actions and necessary for certification.

The court rejected the argument that it could not vary its costs order to add class counsel, finding the original order was based on a record that did not disclose circumstances contrary to the usual expectation of counsel or third-party indemnification. The order was varied to make class counsel responsible for the defendants’ outstanding costs.

The Class Actions Group at Aird & Berlis LLP offers a full range of services, including defending class actions, appellate advocacy, risk mitigation strategies, insurance coverage advice, representation at insolvency-related proceedings and settlement administration advice. Our team of lawyers brings decades of class action experience across a wide range of industries and subject matters. For more information, please contact Co-Leaders Kate Findlay or Steve Tenai.