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Certification Denied for Action Alleging Pure Economic Loss

Written by on August 16th, 2012

Jason Squire

Partner, Deputy Leader, Class Actions Practice Group 

On the certification motion in Arora v. Whirlpool Canada LP, 2012 ONSC 4642, Justice Perell exercised his gatekeeper function, and prevented the plaintiffs from suing Whirlpool Canada for pure economic loss. It was alleged that Whirlpool’s design of certain front-loading washing machines was negligent, resulting in biofilm (mold, mildew, bacteria) buildup and a poor self-cleaning mechanism. Justice Perell reviewed the law of pure economic loss and concluded that there is no common law cause of action for a repair of a non-dangerous defect.

After engaging in a lengthy discussion addressing the cause of action criterion, Justice Perell held that there were no tenable contractual or statutory causes of action underpinning the plaintiffs’ claims. It was also “plain and obvious” that a negligence claim for pure economic loss for non-dangerous products is not a tenable claim in Ontario. Given that there was no wrongdoing recognized at law, a claim in waiver of tort was also untenable.

In contemplation of a potential appeal, in the event Justice Perell was wrong about the cause of action criterion, he went on to decide the other certification criteria. He found that the class definition criterion was satisfied; the common issue criterion was satisfied, but some of the questions were not certifiable and some required revision or substitution; the preferable procedure criterion was not satisfied for some proposed questions because of unmanageability but the preferability criterion was satisfied for the remainder of the questions; and, that the representative plaintiff criterion was satisfied, although the litigation plan would require some refinement.

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