Legal Blog

Certification of Class Action against Toronto Dominion

Monday, December 03, 2007

In a blockbuster ruling the Ontario Court of Appeal has certified a Class Action against the Toronto Dominion Bank for collecting undisclosed fees on Visa card transactions dealing with foreign currency between 1986 and 2003.

The Chief Justice did not buy TD's argument that calculating damages would be expensive and time consuming. He wrote, "it would hardly be sound policy to permit a Defendant to retain a gain made from a breach of contract because the Defendant estimates its costs of calculating the amount of the gain to be substantial."

In a press release on Sutts, Strosberg LLP's website managing partner Harvey T. Strosberg representing the Plaintiffs stated, "this decision is of fundamental importance to TD Visa cardholders as class members and to the public. The Court of Appeal recognized the necessity of allowing a class action against a fundamental institution which allegedly, repeatedly, overcharged some of its customers' small amounts of money totaling tens of millions of dollars."

Lawyers Weekly reported that, "what gave rise to the class action was Dr. Paul Cassano's payment of a US$563.36 hotel bill in New York in 1994. Because the hotel mistakenly charged his TD Visa card twice for CDN$766.62, Cassano received a creditin the amount of CDN$745.44. The $21.18 shortfall consisted of additional fees charged by TD for foreign currency transactions."

The original motion to certify the action as a class action was unsuccessful in March 2005 when it was dismissed due to the fact the motion Judge found that certification could only occur if compensatory damages could be determined on a class-wide basis. As a result' the motion judge found the action did not satisfy the Class Proceeding Act's preferable procedure requirement. This decision was upheld at the Divisional Court until recently, when the Ontario Court of Appeal reversed that finding.

If the Plaintiffs are successful this could have huge implications for TD and the costs could be in the hundreds of millions of dollars.

As of 2001 TD amended its cardholder agreements disclosing the conversion and issuer fees.