Date Closed

May 2, 2008

Lead Office

Toronto

On May 24, 2006, eight class-action lawsuits, brought against major Canadian financial institutions, including The Toronto-Dominion Bank, Canada Trustco Mortgage Company and The National Bank of Canada, on behalf of hundreds of thousands of residential mortgage customers, seek hundreds of millions of dollars in compensation for alleged over-payments made by mortgage customers discharging their residential mortgages prior to maturity. The plaintiffs claim that the financial institutions have erred in calculating the compensation to be paid to the financial institutions in this circumstance, resulting in an over-payment to the financial institutions. The motions court Judge dismissed the plaintiffs’ motions for certification, finding that none of the requirements for certification were met. Significantly, the Court found that the conduct of the plaintiffs’ lawyer in devising, in some instances manufacturing the claim against the financial institutions, was a relevant factor in assessing the appropriateness of certification. Additionally, the motions court Judge found that a claim for breach of an implied term of a contract was not amenable to certification.

The plaintiffs’ appeal to the Divisional Court was heard in September 2007, and dismissed by reasons released in December 2007. The Divisional Court upheld the decision of motions court Judge. The Divisional Court found that the actions were not suitable for certification and agreed with the motion court Judge's findings with respect to the conduct of the plaintiffs' lawyer.

The plaintiffs' sought leave to appeal to the Court of Appeal for Ontario, which was denied in May, 2008. The plaintiffs' have advised that no further steps will be taken in these actions.