Executive Summary: Key Legal and Evidentiary Issues

• Defendants sought to split the trial, along with documentary production and pre-trial discoveries, into a liability stage and a later damages stage.
   
• Rule 6.1.01(2) of the Rules of Civil Procedure sets out the factors the court must weigh before ordering a separate hearing.
   
• Punitive damages, the plaintiff argued, link liability and quantum so closely that the same evidence would be relevant at both stages.
   
• Most categories of documents in the plaintiff’s Discovery Plan were found to be only potentially relevant to quantifying damages or deciding whether punitive damages should be awarded.
   
• Delay was the plaintiff’s main objection, but the court found it unclear that bifurcation would cause more delay than a single process.
   
• A proposed new common issue asking whether the Ontario Consumer Protection Act applies was rejected because the existing section 13 question already raises it.
   

Facts of the case

Karen Robson is the plaintiff in a certified class action in the Ontario Superior Court of Justice against Federal Express Canada Corporation, FedEx Ground Package System, Inc., and FedEx Ground Package System, Ltd. She alleges that the defendants charge hidden or confusing fees on their shipments that class members, the defendants’ retail customers, have neither understood nor agreed to pay. Membership in the class covers all individuals in Canada who, after ordering a shipment for personal, family or household purposes, paid a Federal Express Canada Corporation invoice for at least one of a “Clearance Entry Fee,” “Disbursement Fee,” or “Advancement Fee” from 2016 to the present. The claim seeks $500 million in compensatory, restitutionary and/or disgorgement damages, plus $50 million in exemplary or punitive damages. Certification was granted in 2024 (2024 ONSC 5002) and affirmed by the Court of Appeal in 2025 (2025 ONCA 831). On January 6, 2026, class counsel delivered a proposed Discovery Plan seeking wide-ranging documentary disclosure covering roughly the past decade, including organizational charts, intercompany and transfer pricing documents, remittance records, profit records, credit facility agreements, general ledger data, and financial statements. The defendants brought two motions: one to bifurcate the trial, documentary production and pre-trial discoveries into liability and damages stages, and another to add a new question to the certified common issues. Both were heard on September 25, 2026, and decided on October 1, 2026.

Policy and legislative provisions at issue

The Amended Statement of Claim alleges breaches of section 13 (unsolicited services) and sections 14 and 15 (unfair practices) of the Consumer Protection Act, 2002. Under the certified common issues, the court must decide whether the defendants breached section 13 by providing customs clearance services for which a clearance entry fee and/or disbursement/advancement fee was charged, and, in the alternative, whether they engaged in unfair practices under sections 14 and 15. Further issues address unjust enrichment, a permanent injunction against charging the fees, punitive damages, and waiver of notice requirements under the Act. Four of the common issues, numbered 1(d), 2(b), 3(b), and 5, deal with quantification of damages and with entitlement to and quantification of punitive damages. Rule 6.1.01(2) directs the court, in deciding whether to order a separate hearing, to consider whether doing so will dispose of issues, shorten or simplify the proceeding, or save costs. It also asks whether the issues are clearly severable without unduly repeating evidence or risking inconsistent findings, whether any party would be unduly prejudiced or advantaged, the impact at the current stage, and any other relevant matter. The defendants also relied on the case management judge’s mandate under section 12 of the Class Proceedings Act, described in Amyotrophic Lateral Sclerosis Society of Essex v. Windsor (City), 2015 ONCA 572, as active and strategic case management focused on the fair and efficient resolution of the issues. Their proposed additional common issue read: “Does the Ontario Consumer Protection Act apply to any matter raised in the statement of claim?”

Reasoning and analysis

According to the defendants, the damages evidence was severable from and greatly outweighed the liability evidence, and there was no reason to delay the liability stage while damages-only productions and expert evidence were gathered. Their counsel pointed to some 4.8 million transactions during the class period requiring analysis. They argued that the financial data sought was extremely sensitive in a competitive industry and might never need to be produced if liability were not established. The plaintiff countered that liability and damages evidence were not as easily severable as portrayed, particularly for punitive damages, and that bifurcation could create significant delay. Acknowledging that courts have historically avoided bifurcating trials, the court cited Kovach v. Linn, 2010 ONCA 126, and Peter v. Medtronic Inc., 2009 CanLII 56744, which reserved separation of issues for the rarest of cases where it is clearly advantageous and fair to both parties. Even so, most, if not all, of the Rule 6.1.01(2) factors favoured bifurcation here. Liability and damages evidence was for the most part easily differentiated, and the liability stage would dispose of some issues. There was no danger of inconsistent findings, the case was not a jury trial, and there were no counterclaims, crossclaims or third party claims. Financial information requested by the plaintiff was found to be irrelevant to the liability issues, which focus on whether the services were unsolicited under section 13 or, alternatively, whether the fees were misleadingly disclosed under sections 14 and 15. From Peter v. Medtronic, the court adopted the view that in a class action, postponing quantification lets the parties focus resources on the other certified issues, accelerates the timetable, and avoids prejudicing a defendant whose conduct may not warrant disgorgement. Relying on Yvonne Andersen et al. v. St. Jude Medical, Inc., 2010 ONSC 77, the court held that punitive damages pose no bar to bifurcation, since the evidence about the defendants’ conduct will already be in the record when the damages stage arrives. Delay was accepted as a legitimate concern, but documentary production for liability was complete and the parties were ready to schedule oral examinations for discovery, after which the plaintiff could serve a trial record for the first stage. In the meantime, the defendants can and should be collecting the second-stage evidence, a lengthy process that will have to happen regardless of bifurcation. Any prejudice to the plaintiff was described as speculative and far smaller than the burden on the defendants of completing full damages production before the liability issues were at least underway.

On the proposed new common issue, the defendants argued that the Court of Appeal’s certification ruling had brought new information to light by finding that the certification reasons went too far in opining that the parties’ relationship was an “Ontario legal relationship.” The court disagreed that this was new. It described the appellate comment as a restatement of the principle stated by Lord Abinger in Becham v. Drake (1841) that judges should decide only the points necessary to dispose of a matter. Whether the Act applies is already embedded in the first certified common issue. A finding that section 13 was breached necessarily means the Act applies, while a finding of no breach either resolves applicability or makes it unnecessary to answer. Adding the question would therefore contribute nothing or compel the kind of overreaching analysis the Court of Appeal had said was unnecessary.

Ruling and overall outcome

The defendants’ bifurcation motion was granted, with common issues 1(d), 2(b), 3(b), and 5 separated from the remaining common issues for documentary production, discovery, and the common issues trial. Their motion to add a new common issue was dismissed. Federal Express Canada Corporation and its co-defendants succeeded on the main motion to bifurcate but failed on the amendment, an outcome the court described as mixed. No costs were awarded for or against any party, and no monetary amount was ordered in this decision.