Executive Summary: Key Legal and Evidentiary Issues

• Defendant sought to have its summary judgment application heard separately and in advance of the plaintiff's certification application, asserting both factual and legal flaws in the claim.

• The dispute centers on whether representations about ordinary pricing can be pursued under section 52 of the Competition Act or must exclusively be brought under the civil/reviewable practices provisions of section 74.01 before the Competition Tribunal.

• Parties disagreed fundamentally on the scope of the alleged wrongdoing—defendant contended the claim was limited to three specific furniture products, while plaintiff argued it applied broadly to all homeware products marketed with regular and discount prices.

• Evidence regarding the frequency with which specific products were offered at their "regular" (struck-through) price versus "discount" price became contested, with defendant relying on Competition Bureau enforcement guidelines suggesting a six-month evaluation period.

• The plaintiff advanced multiple legal bases including provincial consumer protection statutes and unjust enrichment, reducing the significance of any limitations on Competition Act remedies alone.

• No court decision had previously adopted the legal theory the defendant advanced regarding the exclusivity of Part VII.1 remedies for ordinary pricing claims, rendering the argument novel rather than well-settled law.

Facts of the case

Alisha Munson, a consumer who purchased a Turner Lift-Top Coffee Table from Leon's Furniture Limited, initiated a class proceeding on December 11, 2024, alleging that the online homeware retailer engaged in deceptive marketing practices. Leon's operates two e-commerce websites—leons.ca and furniture.ca—on which it offers furniture, appliances, electronics, and other homeware products. According to the plaintiff's notice of civil claim, Leon's displays two prices for its products: a "Regular Price" (struck through to indicate it is no longer the current selling price) and a "Discount Price" (the actual sale price). The plaintiff alleged that Leon's represents to consumers that the homeware products are ordinarily offered for sale at the higher regular price and are being offered at a steep discount, often for a limited time. The truth, according to the plaintiff, is that Leon's rarely, if ever, offers these products at the struck-through regular price. Instead, the products are almost always offered and sold at the so-called discount price. This practice, the plaintiff contended, deceives consumers into believing that the products they purchase have more value than they actually do and that they are obtaining a genuine bargain. The plaintiff specifically identified three products in her claim: the Turner Lift-Top Coffee Table (which she herself purchased), an Anthena Polyester Sofa in charcoal, and a Langsdale Glider Recliner in mocha. However, the notice of civil claim also contained broad definitions of "Homeware Products" that could encompass all products offered on those websites. The plaintiff sought certification as a class proceeding on behalf of all individuals and legal persons in Canada who purchased one or more products through the two websites at a discount price.

Legal bases for the claim

The plaintiff advanced claims under multiple legal frameworks. Primarily, she alleged that Leon's breached section 52 of the Competition Act by making false or misleading representations regarding the ordinary selling price of the homeware products, knowing or recklessly that the products were rarely, if ever, offered at the regular price. This breach, she contended, entitled her to damages under section 36 of the Competition Act. Additionally, the plaintiff pursued claims under section 174 of the Business Practices and Consumer Protection Act of British Columbia and comparable consumer protection legislation in other provinces, along with common law claims for unjust enrichment and punitive damages.

The defendant's challenge and sequencing application

Leon's Furniture Limited filed a notice of application seeking summary judgment to dismiss the claim, arguing that the claim was "fundamentally flawed in two ways, the first factual, the second legal." On the factual front, the defendant contended that the plaintiff's allegations regarding three specific products were incontrovertibly false. The defendant presented evidence showing that in the six months prior to the filing of the notice of civil claim, it had offered the Turner Lift-Top Coffee Table for sale at its ordinary price for 158 days and at its sale price for 35 days; the Anthena Polyester Sofa for 138 days at ordinary price and 56 days at sale price; and the Langsdale Glider Recliner for 131 days at ordinary price and 63 days at sale price. The defendant relied on the Competition Bureau's 2009 Enforcement Guidelines, which provide that the "substantial period of time" requirement is met if a product is offered at or above the reference price for more than 50 percent of the time period considered, with that period being six months prior to or following the representation. Since all three products were offered at their ordinary price more than 50 percent of the time according to this metric, the defendant argued the plaintiff's factual allegations could not succeed.

The legal theory advanced

The defendant's legal argument was more novel. It contended that the plaintiff's claim, notwithstanding its stated reliance on section 52, was "entirely premised on the Competition Act's ordinary sales price rules" and therefore fell under section 74.01 of the Competition Act, which governs "deceptive marketing practices" as "reviewable conduct." The defendant argued that ordinary price claims fall under the "civil/reviewable matters track" of the Competition Act, encapsulated in section 74, whereas section 52 represents the "criminal track." Accordingly, the defendant maintained that claims for damages under section 36—which the defendant asserted was limited to violations of Part VI (criminal offences)—were unavailable for ordinary price claims. Instead, any such claims must be brought before the Competition Tribunal under section 103.1, which permits private persons to apply to the Tribunal for leave to make applications regarding reviewable conduct. The defendant argued that allowing an ordinary price case to proceed as a class action in Superior Court would undermine Parliament's intentions in housing ordinary price prohibitions in the civil/reviewable matters track and in legislating that private individuals may only bring such claims before the Competition Tribunal with leave and where the Tribunal finds it in the public interest.

The plaintiff's response and scope dispute

The plaintiff argued that the defendant's application was based on a fundamental mischaracterization of the notice of civil claim. She emphasized that she did not rely on the ordinary price prohibition under section 74.01 to ground the statutory cause of action enabled by section 36 of the Competition Act. Rather, her Competition Act claim was expressly grounded in a breach of section 52, which prohibits false or misleading representations generally. She further stressed that the allegations applied broadly to all homeware products marketed with purported regular and discount pricing, not merely to three specific items. The plaintiff had also delivered a full certification application, supported by expert evidence on methods to assess and quantify class members' losses, along with evidence from a researcher who had tracked the prices of five products (distinct from the three mentioned in the notice of civil claim) over a ten-month period, demonstrating that most were offered at the full struck-through price less than 50 percent of the time. Additionally, the plaintiff pointed out that she advanced claims under provincial consumer protection legislation and in unjust enrichment, meaning that any limitation on Competition Act remedies would not eliminate her legal bases for recovery.

The procedural issue: Sequencing

The central procedural question was whether the defendant's summary judgment application should be heard separately and in advance of the plaintiff's certification application, or whether both applications should be heard together. The defendant sought pre-certification sequencing, arguing that its application could dispose of the entire action or at least substantially narrow the issues, that it could be heard on a limited record without undue cost, and that it could be dealt with efficiently and fairly. The plaintiff opposed sequencing, contending that the defendant's motion would fragment the proceeding, delay its resolution, and inevitably trigger an interlocutory appeal. She emphasized that she had already prepared and delivered her full certification record, making the applications appropriate for concurrent hearing.

The court's analysis

The court applied the "Shaver factors" established in prior case law to guide the exercise of discretion regarding sequencing applications. These factors included: any delay by the plaintiff in proceeding to certification; the extent to which a preliminary application might dispose of the whole proceeding or narrow the issues, taking account of the strength of the applicant's arguments; the cost to the parties of participating in pre-certification procedures; the potential for delay from interlocutory appeals; the complexity and interplay of the issues; whether the outcome would promote settlement; the interests of economy and judicial efficiency; and the fair and efficient determination of the proceeding. The court identified several concerns with sequencing. First, the defendant's proposed factual argument was built on the proposition that the plaintiff's claim was limited to three specific products, yet the plaintiff took a different view of the scope of her claim based on the broader definitions in the notice of civil claim. The court acknowledged that arguments supported either interpretation but declined to decide the scope issue at the sequencing stage. It noted that if it were to conclude that the action should be read as a three-product action, it would seriously consider giving the plaintiff an opportunity to clarify her pleading before proceeding to summary judgment. Second, the court found that the defendant's application would inevitably prompt the plaintiff to tender different evidence supporting her different view of the pleadings and applicable legal tests, creating a real risk of a fragmented record with contested facts from both sides. Third, the court viewed the legal theory advanced by the defendant—that any claim relating to ordinary pricing must be brought under Part VII.1 before the Competition Tribunal—as novel rather than well-settled by authoritative jurisprudence. The defendant could identify no case authority supporting its proposition, and the statutory language appeared permissive rather than mandatory. Section 52(6) of the Competition Act, which states that nothing in Part VII.1 excludes the application of section 52 to conduct that constitutes reviewable conduct, created additional difficulty for the defendant's interpretation. The court noted that while the defendant sought to rely on the historical development of the Competition Act to support a purposive interpretation, such an interpretation was not an "obvious flaw" that would not require lengthy submissions and careful consideration. Fourth, the court recognized that even if successful, the summary judgment application would at best narrow the legal theories on which the plaintiff's claim proceeded, but would not defeat the claim entirely. The plaintiff's other legal bases—provincial consumer protection statutes and unjust enrichment—would remain available, and the same factual issues regarding whether the representations were false or misleading would need to be tried based on the remaining theories. Thus, the streamlining that the application might achieve would not be substantial. By contrast, there was a clear risk that the hearing of the certification application would be delayed not only by a separate hearing of the summary judgment application but also by the possibility of an interlocutory appeal.

Outcome and decision

The court concluded that hearing the two applications separately would not contribute to the fair and efficient determination of the proceeding. Rather, it would likely result in litigating "in slices"—a practice that can lead to delays, higher costs, and increased complexity. The court determined that the better approach was to have the two applications heard together. Accordingly, the court ruled that the defendant's summary judgment application should be heard at the same time as the plaintiff's certification application. This decision meant that the threshold legal and factual issues regarding the availability of section 36 remedies and the scope of the plaintiff's claims would be addressed in the context of the full certification hearing, allowing the court to consider all relevant evidence and legal arguments in a comprehensive manner.