Thus far, posts on this blawg have only discussed conflicts decisions from provincial courts. In a change of pace, I want to bring to everyone’s attention a recent conflicts case from the Federal Court of Appeal: Mitsui O.S.K. Lines Ltd. v. Mazda Canada Inc., 2008 FCA 219. This case – a legal component of the well-publicized “Cougar Ace” drama – is interesting both for its extensive discussion and application of FNC principles, and for its somewhat questionable approach to jurisdiction simpliciter.
Archive for July, 2008
Posted by Seva on July 23, 2008
Posted by Seva on July 21, 2008
The requirement for proving foreign law via expert evidence, and a presumption of similarity to lex fori in the absence of such evidence, has been trite law for some time. However, as the decision of Mr. Justice Matsuhara in Seidel v. Telus Communications Inc., 2008 BCSC 933 shows, at least part of this triteness is that no one has bothered to assail this proposition. In Seidel, the plaintiff, seeking the court’s conclusion that the law of Quebec on the subject of arbitration and certification of class action proceedings was substantially different from that of BC, argued that expert evidence on the law of Quebec is unnecessary and inadmissible. She argued that the court was qualified to consider Quebec law, particularly its statutory scheme, without additional help.
Unsurprisingly, the court disagreed with this assertion. Instead, it proceeded to analyze the question of admissibility via the principled approach to expert evidence from R. v. Mohan, focusing on necessity. The court took into account that foreign law has traditionally been proven by expert evidence, that Quebec law, under its civil tradition, is statutory; that under s. 24(2)(e) of the B.C. Evidence Act, the court must take judicial notice of statutes of other provinces; and that a judicially noticed fact is not open to rebuttal (R. v. Spence). The resolution of this dilemma lay in the conclusion that there is a difference between judicially noticing the existence of a foreign statute, and receiving expert evidence on its meaning and effect within that legal system. As Matsuhara J. concluded at para. 24:
It would be audacious of me to conclude that simply because I can read the translations of the provisions of the Civil Code I have the capacity to fully understand and interpret the meaning of such provisions. In other words, this is information that is “outside of the experience the trier of fact”, which makes expert evidence necessary.
As a not-so-long-ago law student, I find that it is always useful to find a case expounding on an otherwise trite principle of law and confirming its validity via principled analysis.
Posted by Seva on July 11, 2008
I am quite far behind the 8-ball on this one, but since I only read about it today in another case I thought I’d share. In December 2007, Cullity J., of the Ontario Superior Court of Justice, dismissed the action brought by Mr. Schreiber against the former Canadian prime minister Mr. Mulroney. The reason for the dismissal was that the plaintiff was not able to establish an RaSC between Ontario and the claim. What is notable about this case, at least from the conflict of laws perspective, is that Cullity J. concluded that the eight Muscutt factors may not be sufficient to test for RaSC, and added his own, contract-specific factors:
 Most of the Muscutt features do not weigh significantly in favour of one side or the other in this case and the connections counsel relied upon most strongly can, I think, be squeezed only into the first and the second most general categories that examine the connection between the forum and the plaintiff’s claim, and that between the forum and the defendant. Three of these factors are provided by rule 17.02(f) and (h) – the place where a contract was made; the place where it was allegedly breached; and the place where damage resulting from the breach was sustained. Other factors that may have special relevance to actions for breach of contract are the place where the contract was to be performed and, at least, in a contract for personal services, the place of the defendant’s residence during the term of the contract, as well as at its inception. I will consider these possible – specifically contractual – connections before looking at the other factors identified in Muscutt.
Nothing is particularly unusual about these factors except, of course, the authority given to them by this decision.
Posted by Seva on July 10, 2008
In an action involving foreign corporations or corporate-like trusts, how should the question of plaintiff shareholders’ standing to make a claim be decided? This issue was addressed by Madam Justice Newbury confirmed in Everest Canadian Properties Ltd. v. Mallmann, 2008 BCCA 276. Considering the classic rule from Foss v. Harbottle, which dictates that a shareholder cannot sue for injury to the corporation, she confirmed that this is a procedural rule. Thus, a shareholder’s standing is to be determined in accordance with lex fori even if the corporation involved is foreign. I think that it may useful to reproduce the two key paragraphs from the judgment where Newbury J.A. pays heed not only to precedents, but to academic literature on this subject as well:
12 Although the characterization of the rule in Foss v. Harbottle for conflicts of law purposes was not discussed by the court below, it is implicit in Ross J.’s reasons and in counsel’s arguments that the rule is a procedural one and that therefore the lex fori applies to determine a shareholder’s standing to sue. This was the view taken in Heyting v. DuPont,  2 All E.R. 273, 1 W.L.R. 843 (C.A.), where a shareholder of a Jersey company sought to sue, in England, a corporate director for misfeasance. At the outset of his reasons, Russell L.J. said this:
This appeal is from a decision of Plowman J. that a claim, asserting liability of a director of a Jersey incorporated limited liability company, to the company for damages for misfeasance, could not be put forward by a shareholder suing on behalf of himself and shareholders other than the allegedly liable director, who held the majority of shares and could therefore control a vote on whether the company should be a plaintiff in such a claim. It thus appears that the question is whether this is a case in which a departure from the rule in Foss v. Harbottle is required. I dare say that the rule in Foss v. Harbottle is a conception as unfamiliar in the Channel Islands as is the Clameur de Haro in the jurisdiction of England and Wales. But clearly this is a matter of procedure to be decided according to the law of this forum. [At 848; emphasis added.]
13 Although this reasoning was questioned by one writer (see Anthony Boyle, “A Liberal Approach to Foss v. Harbottle” (1964) 27 Mod. L. Rev. 603), the same author in a later article (“The Shareholders’ Derivative Action in the English Conflict of Laws” (2000) Eur. Bus. L. Rev. 130) retreated from his previous position and agreed that “… the principle of the company as the proper plaintiff (even if it rests upon the concept of corporate personality) should probably be regarded as procedural. Certainly the conditions that govern the use of the derivative actions are essentially procedural.” (At 131.) In Canada, although the matter is not free from doubt, the better view would appear to accord with Heyting v. DuPont. (See, e.g., Baniuk v. Carpenter (No. 2) (1987) 85 N.B.R. (2d) 385, at 393-4, 217 A.P.R. 385 (C.A.) and Teck Corp. v. Millar,  2 W.W.R. 385 at 388-9, 33 D.L.R. (3d) 288 (B.C.S.C.), at para. 13; cf. King v. On-Stream Natural Gas Management Inc.,  B.C.J. No. 1302 (S.C.) (QL) at para. 67.)
While the conclusion reached does not appear to be particularly controversial, it is always useful to have recent and persuasive authorities restating an old rule.
Posted by Seva on July 8, 2008
It’s a good thing I wasn’t deceived by the headnotes to Stanway v. Wyeth Canada Inc., 2008 BCSC 847; this case is much more than a run-of-the-mill application of s. 10 of the CJPTA. If accepted as an accurate statement of law, this decision may stand for two important propositions. First, “harmonization” and “co-ordination”, such as co-ordination of labelling and safety requirements, between an international parent company and a local, but substantially independent subsidiary may be sufficient to establish RaSC. Second, and I think more important and contentious, the eight Muscutt factors (or at least those that the court chooses to consider) may be used to prove a s. 10 presumption.
Posted by Seva on July 3, 2008
The Alberta case of Warren v. ABC Wilderness Adventures Ltd., 2008 ABQB 258 confirms that mailing an offer or a prospectus to a different province may be sufficient for the courts of that province to allow ex juris service and possibly even to establish jurisdiction simpliciter.