Summary
35009
Bank of Montreal, et al. v. Réal Marcotte, et al.
(Quebec) (Civil) (By Leave)
Keywords
None.
Summary
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Consumer Protection - Financial Institutions - Credit Cards - Did the Court of Appeal err when it held that the Respondents’ conversion fees were not credit charges within the meaning of ss. 69 and 70 of the Consumer Protection Act, R.S.Q., c. P-40.1 (the “CPA”)? - Did the Court of Appeal err in stating in obiter that the violation of the CPA was covered by section 271 of this act? - On the issue of prescription, did the Court of Appeal err in finding in obiter that a new contract is not formed under the CPA when a new credit card is issued to the consumer? - Are the plaintiffs entitled to restitution under the Civil Code of Québec?
Constitutional Law - Interjurisdictional Immunity - Federal Paramountcy - Financial Institutions - Credit Cards - Consumer Protection - Applicability and Operability of the CPA in conjunction with Bank Act, S.C. 1991, c. 46, as am. and the Cost of Borrowing (Banks) Regulations, SOR/2001-101, as am. - Are ss. 12, 66-72, 83, 91, 92, 126, 127, 219, 228, and 271-272 of the Consumer Protection Act, R.S.Q., c. P-40.1, and ss. 55-61 of the Regulation respecting the application of the Consumer Protection Act, R.R.Q., c. P-40.1, r. 3, constitutionally inapplicable in respect of bank-issued credit cards by reason of the doctrine of interjurisdictional immunity? - Are ss. 12, 66-72, 83, 91, 92, 126, 127, 219, 228, and 271-272 of the Consumer Protection Act, R.S.Q., c. P-40.1, and ss. 55-61 of the Regulation respecting the application of the Consumer Protection Act, R.R.Q., c. P-40.1, r. 3, constitutionally inoperative in respect of bank-issued credit cards by reason of the doctrine of federal paramountcy?
Civil procedure - Class Actions - Do the plaintiffs have standing to bring an industry-wide class action without a cause of action against certain defendants?
In the context of this class action, the representative plaintiffs alleged that various banking institutions breached the CPA by failing to disclose foreign exchange conversion charges on credit cards as a “credit charge”. The CPA requires that all “credit charges” be included as part of the “credit rate” and disclosed to cardholders as an annual percentage. The representative plaintiffs further alleged that as a “credit charge”, foreign exchange charges were subject to the CPA’s 21-day “grace period” and hence could not be imposed to consumers who paid their balance within the grace period. Finally, it was also contended that during certain periods, the banking institutions did not disclose the foreign exchange conversion charge separately, thereby triggering liability for restitution and punitive damages under the CPA. All of these allegations were denied by the banking institutions, who maintained that foreign exchange conversion charges are not “credit charges” within the meaning of the CPA. Rather, it was contended that the charges at issue are part of the “net capital”, and are accordingly not subject to the provisions of the CPA regarding the manner in which the credit rate must be disclosed. Alternatively, on the basis of existing federal legislation applicable to the banking industry, the banking institutions contended that the CPA is constitutionally inapplicable under the interjurisdictional immunity doctrine, and that it is otherwise inoperative under the paramountcy doctrine.
Lower Court Rulings
Superior Court of Quebec
500-06-000197-034
Court of Appeal of Quebec (Montréal)
2012 QCCA 1396, 500-09-019849-090, 500-09-019850-098, 500-09-019851-096, 500-09-019852-094, 500-09-019853-092, 500-09-019854-090, 500-09-019855-097, 500-09-019856-095, 500-09-019857-093
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