Background:
Linnea Gibbs appealed the British Columbia Supreme Court's decision refusing to certify a class action against HSBC Global Asset Management (Canada) Limited and HSBC Investment Funds (Canada) Inc. She alleged that HSBC misrepresented mutual funds as “actively managed” when they were actually “passively managed,” resulting in excessive fees for investors.

Legal Issues:

1. Whether the claim disclosed a valid cause of action under the Class Proceedings Act.
2. Whether the certification judge erred in requiring proof of fraud.
3. Whether the court should certify the class action.
4. Whether the trial judge erred in awarding costs against Gibbs despite the presumption against costs in class proceedings.

Court’s Findings:

• The lower court mischaracterized the claim as requiring fraud and wrongly dismissed the certification application.
• Gibbs properly pleaded causes of action for breach of trust, breach of fiduciary duty, failure to comply with statutory disclosure obligations, and unjust enrichment—none of which required fraud.
• The Court of Appeal certified the class action and found that the requirements for certification were met.
• The costs award against Gibbs was overturned, as there were no “exceptional circumstances” to justify it under the Class Proceedings Act.

Total Costs/Awards:
The court did not award costs to either party on appeal, adhering to the general rule against costs in class proceedings.