In Beaule v. Manufacturers Life Insurance Company, 2021 ONSC 1876, Mr. Justice James F. Diamond dismissed defendant’s application to decline jurisdiction on the basis of forum non conveniens. As part of his analysis of the presumptive connecting factors identified in Club Resorts Ltd. v. Van Breda, 2012 SCC 17 (CanLII), [2012] 1 SCR 572, Diamond J. also considered that Ontario, unlike Québec, imposed mandatory mediation. Diamond J. determined that depriving plaintiff of the mandatory mediation could quantify as a loss of juridical advantage and “slightly favours Ontario”.
Defendant terminated Plaintiff’s long-term disability benefits on February 10, 2020 and Plaintiff instituted proceedings on March 3, 2020 before the Ontario Superior Court. Defendant filed a motion arguing that, despite having jurisdiction simpliciter over the subject matter of the action, the Ontario Superior Court should exercise its discretion to find Ontario to be forum non conveniens and stay or dismiss the action in favour of the Québec courts.
Diamond J. listed the four (4) presumptive connecting factors identified in Club Resorts Ltd. v. Van Breda, 2012 SCC 17 (CanLII), [2012] 1 SCR 572 to determine the existence of a “real and substantial connection” to a particular jurisdiction: (a) the defendant is domiciled or resident in the province; (b) the defendant carries on business in the province; (c) the tort was committed in the province; and,(d) a contract connected with the dispute was made in the province.
Diamond J. noted that a plaintiff need only establish the existence of one (1) of the factors. On the record, Diamond J. determined that several presumptive factors existed ncluding that defendant operated in the province of Ontario and issued the insurance policy there. Diamond J. confirmed that he could assume jurisdiction over the action.
At paras 23-43, Diamond J. turned to address whether he should nonetheless decline jurisdiction due to forum non conveniens. He relied on the guidance set out in Club Resorts Ltd. v. Van Breda, cautioning that he “must engage in a contextual analysis, but refrain from leaning to extensively in favour of its own jurisdiction”.
He considered the location of the majority of the parties, the location of the key witnesses and evidence, contractual provisions or concerns addressing the applicable law or the court’s jurisdiction, the avoidance of a multiplicity of proceedings and enforcement of any potential judgment. On each he concluded with a determination that the factor was neutral or favoured either Ontario or Québec as a venue, if only “slightly” in some cases.
Of particular interest to alternative dispute resolution practitioners, Diamond J. closed his analysis on forum non conveniens with paras 40-43 captioned as “Will Declining Jurisdiction deprive the Applicant of a Legitimate Judicial Advantage available in the Domestic Court”.
Though not referred to expressly by Diamond J. in his reasons, the mention of “judicial advantage” no doubt drew on or rephrased the Supreme Court’s own mention of “juridical advantage” in Club Resorts Ltd. v. Van Breda at paras 63, 111-112 and 118. See more below in urbitral notes.
Diamond J. cautioned that he had little evidence before him with respect to the presence of a “loss of judicial advantage” if he dismissed or stayed the Ontario action. Despite some argument on the impact of language and the perceived advantages/disadvantages involving documentation written in French, Diamond J. noted only a single element which “slight favours Ontario” and involved either jurisdiction’s decision to make mediation mandatory or not.
“[42] The plaintiff gave further evidence that unlike Quebec, legal proceedings in Ontario are subject to the mandatory mediation rule, whereby the Civil Code of Quebec does not have such a corresponding rule, and any potential mediation is voluntary.
[43] In my view, this could quantify as a loss of judicial advantage, and as such I find that this factor slightly favours Ontario”.
Based on all the factors, Diamond J. dismissed Defendant’s application, holding that it had failed to meet its onus that Ontario was forum non conveniens.
urbitral notes – First, the preliminary provision of the Code of Civil Procedure, CQLR c C-25.01 (“C.C.P.”) and articles 1-7 C.C.P. do mention the obligation of litigants to consider private prevention and resolution processes before referring their dispute to the courts.
“Article 1 C.C.P. To prevent a potential dispute or resolve an existing one, the parties concerned, by mutual agreement, may opt for a private dispute prevention and resolution process.
The main private dispute prevention and resolution processes are negotiation between the parties, and mediation and arbitration, in which the parties call on a third person to assist them. The parties may also resort to any other process that suits them and that they consider appropriate, whether or not it borrows from negotiation, mediation or arbitration.
Parties must consider private prevention and resolution processes before referring their dispute to the courts”.
Regarding those provisions, see the recent Arbitration Matters note “Québec – precedents on attornment re-read in light of newer rules requiring compliance to judicial contract – #434”. In Bergeron v. 2528-1023 Québec inc., 2021 QCCS 539, Mr. Justice Babak Barin underlined (i) the importance of alternative dispute resolution and (ii) the principles applicable to submission/attornment to the court’s jurisdiction. Barin J. first drew attention to the primacy given by Code of Civil Procedure, CQLR c C-25.01 to alternative dispute resolution and then commented on the general principles and particular factual elements related to parties attorning to a court’s jurisdiction. Barin J. reconsidered earlier case law which issued before recent court rules updates which now oblige litigants, at the onset of the litigation, to identify their intention to raise declinatory exceptions. His comments suggest that earlier case law must be re-read in light of newer rules requiring parties to commit earlier and clearly to their procedural decisions and to abide by their “judicial contract”. Barin J.’s comments on attornment may assist litigants to determine whether a party has or has not waived the benefit of their agreement to arbitrate.
Second, though the Supreme Court in Club Resorts Ltd. v. Van Breda cautioned against “undue emphasis on juridical disadvantage as a factor in the jurisdictional analysis”, its addition of “undue” recognized that the disadvantage did have some weight. At para. 63 the Court observed “in passing, however, that undue emphasis on juridical disadvantage as a factor in the jurisdictional analysis appears to be hardly consonant with the principle of comity that should govern legal relationships between modern democratic states”.
Third, the following passages in Club Resorts Ltd. v. Van Breda addressed the role of “juridical advantage” which could ‘conflate’ two (2) different issues: “the impact of the procedural rules governing the conduct of the trial, and the proper substantive law for the legal situation”.
“[111] Loss of juridical advantage is a difficulty that could arise should the action be stayed in favour of a court of another province or country. This difficulty is aggravated by the possible conflation of two different issues: the impact of the procedural rules governing the conduct of the trial, and the proper substantive law for the legal situation, that is, in the context of these two appeals, the proper law of the tort. In considering the question of juridical advantage, a court may be too quick to assume that the proper law naturally flows from the assumption of jurisdiction. However, the governing law of the tort is not necessarily the domestic law of the forum. This may be so in many cases, but not always. In any event, if parties plead the foreign law, the court may well need to consider the issue and determine whether it should apply that law once it is proved. Even if the jurisdictional analysis leads to the conclusion that courts in different states might properly entertain an action, the same substantive law may apply, at least in theory, wherever the case is heard.
[112] A further issue that does not arise in these appeals is whether it is legitimate to use this factor of loss of juridical advantage within the Canadian federation. To use it too extensively in the forum non conveniens analysis might be inconsistent with the spirit and intent of Morguard and Hunt, as the Court sought in those cases to establish comity and a strong attitude of respect in relations between the different provinces, courts and legal systems of Canada. Differences should not be viewed instinctively as signs of disadvantage or inferiority. This factor obviously becomes more relevant where foreign countries are involved, but even then, comity and an attitude of respect for the courts and legal systems of other countries, many of which have the same basic values as us, may be in order. In the end, the court must engage in a contextual analysis, but refrain from leaning too instinctively in favour of its own jurisdiction. At this point, the decision falls within the reasoned discretion of the trial court. The exercise of discretion will be entitled to deference from higher courts, absent an error of law or a clear and serious error in the determination of relevant facts, which, as I emphasized above, takes place at an interlocutory or preliminary stage. I will now consider whether the Ontario courts properly assumed jurisdiction in these cases and, if so, whether they should have declined to exercise it on the basis of forum non conveniens”.
Fourth, see also Oppenheim forfait GMBH v. Lexus maritime Inc, 1998 CanLII 13001 (QC CA) referred to by the Supreme Court in Club Resorts Ltd. v. Van Breda at para. 107. The Supreme Court summarized its reading of that earlier decision involving article 3135 of the Civil Code of Québec, CQLR c CCQ-1991.
“[107] Quebec’s courts have adopted an approach that, although basically identical to that of the common law courts, is subject to the indication in art. 3135 that forum non conveniens is an exceptional recourse. A good example of this can be found in the judgment of the Quebec Court of Appeal in Oppenheim forfait GMBH v. Lexus maritime inc., 1998 CanLII 13001, in which an action brought in Quebec was stayed in favour of a German court on the basis of forum non conveniens. Pidgeon J.A. emphasized the wide-ranging and contextual nature of a forum non conveniens analysis. The judge might consider such factors as the domicile of the parties, the locations of witnesses and of pieces of evidence, parallel proceedings, juridical advantage, the interests of both parties and the interests of justice (pp. 7-8; see also Spar Aerospace, at para. 71; J. A. Talpis with the collaboration of S. L. Kath, “If I am from Grand-Mère, Why Am I Being Sued in Texas?” Responding to Inappropriate Foreign Jurisdiction in Quebec-United States Crossborder Litigation (2001), at pp. 44-45)”.