A Defence of Detrimental Reliance in Competition Act Misrepresentation Class Actions

Abstract

This paper examines the recent jurisprudence which, some suggest, holds that detrimental reliance is unnecessary to certify a class in product misrepresentation cases under the Competition Act. Contrary to that conclusion, the author reviews the applicable jurisprudence and demonstrates that detrimental reliance is always required in misrepresentation cases. Cases that claim not to require detrimental reliance do in fact require it – just from third parties, not necessarily from the plaintiff class. Thus, detrimental reliance remains a critical link in the chain of causation in all misrepresentation cases. Where representations are made to the plaintiff class as opposed to third parties, experience demonstrates that such cases continue to raise individual issues and are not likely suitable for class treatment. It remains to be seen whether the recent amendments to the Competition Act will prove an effective option for consumers seeking compensation for misrepresentations.