Canadian Maritime Law
Federal
Court Jurisdiction
Introduction / Canadian Maritime Law / Federal
Court Jurisdiction
The cases digested on this page consider two separate but closely related
topics; the definition, nature and scope of the body of law known as Canadian
Maritime Law and the Admiralty jurisdiction of the Federal Court.
Canadian Maritime Law is a separate and distinct body of law
enacted by s. 42 of the Federal Court Act and defined in section 2 of the
Federal Court Act. It is the law that governs matters relating to ships and
the sea regardless of the court in which proceedings are commenced. The
rights and remedies that apply under Canadian Maritime Law are often
different from those that would otherwise apply under the provincial laws of
general application. It is therefore important to always determine if a
matter is governed by Canadian Maritime Law and to determine the nature of
that law. The determination of whether a matter is governed by Canadian
Maritime Law frequently involves a constitutional law analysis of the
division of powers between the Federal and Provincial Governments, as can be
seen in many of the cases digested below.
The admiralty jurisdiction of the Federal Court is closely connected to
the definition, nature and scope of Canadian Maritime Law since it is a
statutory court and has only the jurisdiction specifically given it by
statute. Section 22 of the Federal Court Act gives it jurisdiction to hear
and determine any case "in which a claim for relief is made or a remedy is
sought under or by virtue of Canadian maritime law".
For further background and a review of the important cases in this area
please see the speaking notes entitled The Constitutional Implications of Ordon v Grail and
Expanding Definition of Canadian Maritime Law.
Jurisdiction – Personal Injury During Boat Trailering
- Limitation of Liability
Isen v Simms,
2006 SCC 41
The Defendant was injured when a bungee cord that was
being used to secure the engine cover of a small pleasure boat slipped from
the hands of the Plaintiff shipowner and struck the Defendant in the eye. At
the time of the incident the pleasure boat had just been removed from the
lake and was on a trailer being prepared for road transportation. The
Defendant commenced proceedings against the Plaintiff in the Ontario Supreme
Court for damages in excess of $2,000,000. The Plaintiff commenced this
action in the Federal Court to limit his liability to $1,000,000 and brought
this application under Rule 220(1)(c) of the Federal Court Rules to
determine a question of law, namely: whether the facts and circumstances
constituted “claims arising on any distinct occasion involving a ship with a
tonnage of less than 300 tons” pursuant to section 577(1) of the Canada
Shipping Act. The Defendant contested both the jurisdiction of the
Federal Court and the substantive relief sought. The Federal Court and the
Federal Court of Appeal both held that the claim was a maritime law claim
that was subject to the limitation of liability. On appeal to the Supreme
Court of Canada, the Supreme Court held that the matter was governed by
provincial law, that the Federal Court was without jurisdiction and that the
limitation was not applicable. In reaching this conclusion Rothstein J.
noted that Parliament did not have jurisdiction over pleasure craft per
se and that the Court must look at the allegedly negligent acts “and
determine whether that activity is integrally connected to the act of
navigating the pleasurecraft on Canadian waterways such that it is
practically necessary for Parliament to have jurisdiction over the matter”.
Although he agreed with the Federal Court of Appeal that launching of
pleasurecraft and their retrieval from the water would be within
Parliament's jurisdiction over navigation, he did not agree that the
securing of the engine cover with a bungee cord was part of the retrieval
process. He stated that the securing of the engine cover had nothing to do
with navigation and everything to do with preparing the boat to be
transported on provincial highways.
Constitutional Law – Occupiers Liability Act – Personal
Injury on Wharf
Jackson v Fisheries and Oceans Canada,
2006 BCSC
1492
This case concerned the constitutional applicability of the Occupiers
Liability Act of British Columbia to a slip and fall that occurred while the
Plaintiff was walking down a ramp from the shore to a wharf administered by
Fisheries and Oceans Canada. The Defendants argued that the Occupiers
Liability Act had no application as the matter was to be governed by
Canadian Maritime Law. The Judge considered the decision of the Supreme
Court of Canada in Ordon v Grail, [1998] 3 SCR 437 but held that a
provincial statute could incidentally affect matters coming within the
exclusive jurisdiction of Parliament. The Judge noted that the Defendants
needed to show that the subject matter of the Plaintiff's claim “is so
integrally connected to maritime matters as to be legitimate Canadian
Maritime law within federal competence” and held that they had failed to do
this. It is noteworthy that the Judge considered the case of Peters v ABC
Boat Charters, [1992] B.C.J. No. 2345, where it was held that the Occupiers
Liability Act applied to a slip and fall on board a ship, and was asked to
not follow it on the grounds that it had been implicitly overruled by Ordon
v Grail. The trial Judge held, however, that Peters v ABC Boat Charters was
still good law.
Personal Injury – Limitation Periods – Athens Convention
– Extension of Suit Time – Application of Provincial Limitation Statutes
MacKay v Russell et al.,
[2006]
NBQB 350
See the summary under “Miscellaneous/Personal
Injury” where it was held that a claim for personal injury on board a
whale watching boat was governed by the Marine Liability Act and not the
provincial limitations statute.
Enforcement of Foreign Judgements – Proper Test –
Attornment – Application of Provincial Statutes
Morgan v Guimond Boats Ltd.,
2006 FCA 401
reversing
2006 FC 370
See the
summary under “Miscellaneous”. A noteworthy
issue dealt with by the motions Judge but not addressed in the Court of
Appeal was whether the Foreign Judgments Act of New Brunswick had any
application. The motions Judge held that the statute, being a provincial
statute, can have no application to Canadian maritime law, even in the
absence of applicable federal legislation.
Constitutional Law – Division of Powers – Log Salvage - Forest Act – Salvage
Convention
Early Recovered Resources Inc. v British Columbia,
2005 FC 995
The issue in this case was the constitutional validity
or applicability of: first, Part 9 of the Forest Act of British
Columbia and the associated Log Salvage Regulation passed pursuant
thereto; and second, the Canada Shipping Act and the International
Convention on Salvage (the
“Salvage Convention”). Part 9 of the Forest Act and the Log
Salvage Regulation regulate, inter alia, the recovery of logs
adrift within a prescribed geographic area. The Plaintiff argued that the
Forest Act and Log Salvage Regulation were invalid regulation by
the province of “marine salvage”, a core element of exclusive federal
jurisdiction over navigation and shipping. The Judge reviewed relevant
authorities and held that the appropriate approach to the analysis was to
employ a “pith and substance” analysis to determine: 1. whether the impugned
provisions intrude on a federal head of power and to what extent; 2. If they
do intrude, are they nevertheless part of a valid provincial legislative
scheme; and, 3. If they are part of a valid provincial scheme, are they
sufficiently integrated with that scheme. The Judge specifically rejected
the suggestion that the appropriate analysis was to apply the
“inter-jurisdictional immunity” test set out in Ordon v Grail, [1998]
3 SCR 437. He held that the “inter-jurisdictional immunity” doctrine need
not be considered if the pith and substance of the impugned provision does
not intrude into a power of the other government. He then reviewed the
provisions of Part 9 of the Forest Act and the associated regulations
and noted that Part 9 provided a framework for dealing with forestry
resources that had become drift timber and needed to be recovered and
salvaged to realize its value. He held that these provisions had nothing to
do with navigation and shipping and that any connection with navigation and
shipping was tenuous. He further held that Part 9 of the Forest Act
and the regulations were an integral part of a valid resource management
scheme and even if they intruded on the federal navigation and shipping
power such intrusion was merely incidental and did not affect the
constitutional validity of the legislation. The Judge then considered the
constitutional validity of the Canada Shipping Act and the Salvage
Convention insofar as they purported to regulate the recovery and sale
of logs and the distribution of the proceeds of sale. He addressed the issue
of whether logs were “property” within the meaning of the convention and
held that they were. He then declared that the Canada Shipping Act
and the Salvage Convention were invalid insofar as they purported to
regulate the recovery and sale of logs and the distribution of the proceeds
of sale. The reason given for this declaration was to remain consistent with
his previous holding that the Forest Act was valid provincial
legislation.
Canadian Maritime Law – Workers Compensation
Laboucane v Brooks et al., 2003 BCSC 1247
The issue in this important summary trial application was
whether section 10(1) of the Workers Compensation Act of British
Columbia was valid provincial law or whether it was ultra vires the
province as infringing upon Federal jurisdiction over navigation and
shipping. The underlying facts were that the Plaintiff was injured while
performing a welding job on the Defendant's fishing vessel. The Plaintiff
commenced these proceedings against the Defendant alleging his injuries were
caused by the Defendant's negligence. The main defence to the action was
that both Plaintiff and Defendant were “workers” within the meaning of the
Workers Compensation Act, that the accident arose out of and during
the course of employment and that s. 10(1) of that Act prohibited the
Plaintiff from commencing or continuing the action. The Court reviewed many
of the leading constitutional authorities and concluded that the proper
approach was to first determine the “pith and substance” of the enactment
and then to determine whether the pith and substance of the enactment
relates to one of the heads of power granted to the enacting legislature.
Further, the Court noted that if the pith and substance falls within the
class of subjects assigned to the Province then the legislation will be
valid notwithstanding that it may have incidental or ancillary affects in
areas of Federal jurisdiction. The Court rejected the submissions of the
Plaintiff that the appropriate analysis was to assume the constitutional
validity of the provision and to commence with the tests set out in Ordon
v Grail, [1993] 3 SCR 437. Applying the pith and substance approach the
Court had little difficulty in concluding that the pith and substance of s.
10(1) of the Workers Compensation Act was solely within the exclusive
jurisdiction of the Province in relation to Property and Civil Rights. The
Court further held that the fact that the accident took place on a vessel
was of no relevance and that the subject matter was not integrally connected
with maritime matters and did not fall to be resolved under Canadian
Maritime Law. In fact, the Court found there was no encroachment upon the
Federal power over navigation and shipping. (Editors Note: It is arguably
difficult to reconcile the approach in this case with the four part test set
out in Ordon v Grail, [1993] 3 SCR 437. Additionally, it is difficult
to reconcile the finding in this case that there was no encroachment on
Federal jurisdiction when the Supreme Court of Canada in Ordon v Grail
held that Maritime negligence law is a core element of Federal
jurisdiction and that it was constitutionally impermissible for a provincial
statute to regulate this area.)
Federal Court Jurisdiction – Scope of Canadian Maritime Law
Kusugak v Northern Transportation Co. et al., 2004 FC 1696
In this case the Plaintiffs were the dependants
of crew members of the “Avatuq” which sank on 25 August 2002 while en route
from Churchill, Manitoba to Arviat, Nunavut. All of the crew members
perished. The Defendants included the Commissioner
of Nunavut, the Government of Nunavut and some of their employees (the
“Nunavut Defendants”). The allegations against the Nunavut Defendants were
that they failed to have in place or implement proper procedures in relation
to the search and rescue operation. The Nunavut Defendants brought this
application to strike the Statement of Claim against them on the grounds
that the Federal Court was without jurisdiction. The Plaintiff, on the other
hand, argued that the claim was within the maritime jurisdiction of the
court. The motions Judge reviewed the applicable authorities, in particular
Dreifelds v Burton, (1998) 38 OR (3d) 393, and noted that a matter
will only fall to be determined by Canadian Maritime Law if it is
sufficiently connected with navigation and shipping. She held that the
claims had nothing to do with navigation and shipping and were grounded
solely in common law principles of negligence. Accordingly, she concluded
that the Court was without jurisdiction. She further held that the Nunavut
Defendants were public authorities over whom the Court had no jurisdiction.
Constitutional Law – Distribution of Powers – Navigation
and Shipping – Salvage
Gulf Log Salvage Co-Operative Assoc. v Early Recovered
Resources, 2003 FCA 35
This case concerned the constitutional validity of the Log
Salvage Regulations of British Columbia. An application for summary judgment
was brought by the Province of British Columbia for a declaration that the
Regulations were valid. The motions Judge dismissed that application leaving
no doubt that he considered the Regulations ultra vires (2002 FCT
184). The Province of British Columbia appealed to the Federal Court of
Appeal but the Court of Appeal held that it was not appropriate to rule on
the constitutional validity of a statute except upon an adequate record and
that there was not an adequate record before the Court.
Constitutional Law - Division of Powers - s. 92(10) of the
Constitution Acts 1867-1992
Island Tug & Barge Ltd. v. Communication, Energy and Paperworkers
Union, Local 601, 2003 BCCA 247
The Respondent union had set up a “water” picket attempting
to prevent vessels from berthing at the Petro-Canada terminal in Vancouver
where the union was on strike. The Appellant tug and barge operators sought
an injunction from the BC Supreme Court to restrict or limit the picketing.
The BC Supreme Court held that it did not have jurisdiction as the matter
fell within provincial jurisdiction and the provincial
Labour Relations Code removed the courts’ jurisdiction to enjoin
picketing. The decision was affirmed on appeal on the basis that the
Appellant’s business was conducted wholly within the province and s. 92(10)
of the Constitution Acts 1867-1992 therefore governed. That section
assigns to provincial jurisdiction local works except, inter alia,
shipping lines connecting the province to other provinces or beyond the
limits of the province. By implication, therefore, a shipping line operated
wholly within the province was within provincial jurisdiction and the BC
Labour Relations Code applied.
Application
of Provincial Statutes
R
v Kupchanko, 2002 BCCA 63,
[2002] B.C.J. No. 148
This case raised
the issue of the constitutional validity of an Order made pursuant to section
7(4) of the Wildlife Act of British Columbia prohibiting motorized
vessels in excess of 10 horsepower from navigating part of the Columbia River.
The accused argued that the Order was an invalid infringement on Federal
Government jurisdiction over navigation and shipping. At first instance, the
Provincial Court agreed and the accused was acquitted. On appeal, the summary
conviction appeal judge held that the impugned order was aimed at promoting the
dominant purpose of the Act to which it was a part. That purpose was to protect
wildlife and their habitat, a matter clearly within the constitutional
jurisdiction of the provinces. The judge held that the fact that the Federal
Government through the Canada Shipping Act had also legislated
restrictions on boating similar to those in the impugned Order did not render
the Order invalid as the Federal Government had not legislated specifically with
respect to that part of the Columbia River the Order regulated. The summary
conviction appeal judge held that there would have to be an express
contradiction between federal legislation and provincial legislation before
otherwise valid provincial legislation could be declared invalid. In reaching
this decision the summary conviction appeal judge relied in large measure upon
dicta of the British Columbia Court of Appeal in Windermere Watersports Inc.
v Invermere, (1989) 37 BCLR (2d) 112. On further appeal the Court of Appeal
of British Columbia reconsidered the Windermere case in light of recent
judgments of the Supreme Court of Canada which were recognized to significantly
narrow the scope for the application of provincial laws to maritime matters. The
Court of Appeal affirmed the result in the Windermere case but noted that
the holding therein that the province could enact legislation affecting a matter
of shipping and navigation was incorrect. Accordingly, the Court of Appeal
allowed the appeal and held that the Order under the Wildlife Act was
inapplicable to conveyances operating in navigable waters.
Insurance - Subrogation
Porto Seguro Companhia De Seguros
Gerais v The "Federal Danube" et al., (January 31, 2001) No. T-2057-85 (F.C.T.D.), [2001] F.C.J. No.
152
This case is summarized under "Carriage of
Goods". One issue in this case was whether the Plaintiff cargo underwriters
had standing to bring suit in their own name for damage caused to the cargo they
insured and for which they indemnified the cargo owners. The Defendant argued
that under Canadian maritime law the Plaintiff ought to have commenced the
action in the name of the cargo owners. The Court, however, held that the matter
was governed either by the law of Brazil (where the insurance contract was made)
or the law of Quebec and that in either case the insurers became subrogated to
the rights of their insured upon payment and were entitled to bring the action
in their own name.
Application of Provincial Statutes
R v Jail
Island Aquaculture Ltd., [2000] N.B.J. No. 338 (N.B.Q.B.)
In this matter the accused had been charged with various
offences under the Occupational Health and Safety Act of New Brunswick.
The charges arose out of a fatal accident that occurred on board the accused’s
barge while smolt salmon were being unloaded into a salmon cage. The accused
argued that as the accident occurred on a ship it fell within exclusive federal
jurisdiction with respect to maritime law and, in particular, navigation and
shipping. At first instance, the Provincial Court Judge dismissed the motion
holding that the case was not about shipping but was about aquaculture, a matter
coming within provincial jurisdiction under property and civil rights. The
accused then brought an application for judicial review to the Court of Queen’s
Bench. The Court of Queen’s Bench did not deal with the substantive issues
raised in the application as it was of the view that the application was in pith
and substance an appeal from the order of the Provincial Court Judge and held
that there was no right to appeal such an interlocutory decision.
Application of Provincial Statutes
The Queen v Will, (1999), 44 O.R. (3d) 315, (Ont. Ct. Prov. Div.).
At issue in this case was the constitutional validity of a regulation passed
pursuant the Provincial Parks Act of Ontario requiring visitors to
provincial parks to purchase a $10 permit to stay in the park overnight. The
accused anchored his boat in Echo Bay on the eastern shore of Georgian Bay in
Lake Huron. Echo Bay was within the boundaries of a provincial park. The
accused, however, refused to purchase the $10 permit and was charged. The
accused argued that the regulation was constitutionally inapplicable. The
Justice of the Peace that heard the case at first instance (reported at [1998]
O.J. 5922) held that the Federal Government had exclusive power to legislate in
respect of navigation and shipping and that this included the right to anchor
without charge. He held that only the Federal Government may interfere with
navigation. He further held that "a province cannot justify even a slight
interference with navigation". Accordingly, the Justice of the Peace found
the impugned regulation to be constitutionally not applicable to the accused.
The court on appeal agreed with the Justice of the Peace. (Note: It is difficult
to reconcile this decision with that in The Queen v Kupchenko summarized
below.)
Application of Provincial Statutes
R v Williams,
(March 13, 2000) No. CC990702 (B.C.S.C.).
In this matter the accused was charged with selling liquor on board his
vessel without a liquor licence in contravention of the Liquor Control and
Licencing Act of British Columbia. The defences argued were that the Liquor
Control and Licencing Act was ultra vires the province insofar as it
attempted to regulate vessels, a matter coming under Federal maritime law, and
that the vessel was operating outside the territorial jurisdiction of the
province. The court determined that the proper test to apply was whether the
provinical legislation affected a vital part of the federal undertaking or
whether it impaired or sterilised a federal undertaking. If it did either, it
was ultra vires. The court found, however, that the sale of liquor on a vessel
was not a vital part of a ship's operations. The court held, therefore, that the
Liquor Control and Licencing Act did not encroach upon federal
jurisdiction over navigation and shipping and did not impair a federal
undertaking.The court further held that the vessel was, at the material times,
operating in and around the Greater Vancouver area which was within the
territorial jurisdiction of the Province of British Columbia.
Fatal Accidents - Limitation Periods
Nicholson v Canada, (February 17, 2000) No. T-748-94 (F.C.T.D.).
This was a summary judgment motion by the Crown for an order dismissing the
claims of the Plaintiffs as time barred. The Plaintiffs were the dependents and
the executor of the deceased who died when his vessel hit a rock and sank. The
Plaintiffs alleged that the accident was caused by the breach of statutory
duties on the part of the Coast Guard. The accident occurred on April 2, 1992,
but the action was not commenced until March 30, 1994. The Defendant argued that
the applicable limitation period was one year from the time of death as
prescribed by section 649 of the Canada Shipping Act. (Note: This
provision has since been amended and the limitation period is now two years.)
The Plaintiffs argued that the discoverability principle operated to extend the
time bar under the circumstances of the case, that the court had inherent
jurisdiction to extend the limitation period, that there was a non-statutory
cause of action to which section 649 did not apply, that the tolling provision
of the Ontario Limitations Act applied, and that, in any event, the claim
of the estate was not covered by section 649. The court dealt with each of these
arguments. With respect to the discoverability principle (i.e. that the
limitation does not run until the Plaintiff is aware of the material facts
giving rise to a cause of action) the court held that this principle applied but
that it did not assist the Plaintiffs as they were aware of the material facts
at the conclusion of the inquest into the death of the deceased yet they did not
commence their action within one year from that date. With respect to the
inherent jurisdiction of the court to extend the limitation period, the court
held that, in the absence of a clear statutory authority it had no such
jurisdiction. (Note: This is contrary to the decision of the Ontario Court of
Appeal in Dreifelds v Burton, (March 6, 1998) No. C 2456 &: C24580 (Ont. C.A.) but is consistent with the decision of the British Columbia
Supreme Court in Vogel v Sawbridge, (April 3, 1996) No. 24638 Kelowna
Registry.) With respect to the alleged common law non-statutory cause of action,
the court held that there was no such cause of action. With respect to the
argument that the tolling provisions of the Ontario Limitation Act
applied, the court held that the incorporation of the tolling provisions would
be inconsistent with the statutory scheme set out in Part XIV of the Canada
Shipping Act. Finally, with respect to the action by the executor of the
estate of the deceased, the court held that this action (which was newly created
by the Supreme Court of Canada in Ordon Estate v Grail, [1998] 3
S.C.R. 437) was not time barred as it was not a claim by dependents and was
governed by the two year limitation period in the Ontario Trustee Act as
incorporated by section 39 of the Federal Court Act. (Note: It is not
apparent why the limitation period in the Ontario Trustee Act would apply
to the action by the executor as that action is a common law action and is not
based on the Trustee Act.)
Supreme Court of Canada Defines Canadian Maritime Law and Applicability of Provincial Statutes
Ordon Estate v Grail,
(November 26, 1998) No.25702 (S.C.C.).
This case is essential reading for all Canadian maritime law practitioners. It concerns four separate actions commenced in the Ontario Court General Division. The actions involved two boating accidents which resulted in fatalities and in serious personal injury. The actions gave rise to similar legal issues. The issues were:
-
Do the superior courts of the provinces have jurisdiction over maritime fatal accident claims or are such claims within the exclusive jurisdiction of the Federal Court?;
-
When can provincial statutes of general application apply to maritime negligence claims? Specifically:
-
Do the provisions of the Ontario Family Law Act allowing claims for loss of care, guidance and companionship by dependants (including common law spouses and siblings) apply to boating accidents?
-
Do the provisions of the Ontario Trustee Act allowing the estate of a deceased person to bring an action for damages apply to boating accidents?
-
Do the provisions of the Ontario Negligence Act apply to boating accidents?
-
Is the the limitation period for fatal boating accidents one or two years?
The Supreme Court of Canada held as follows:
-
Provincial superior courts have an inherent general jurisdiction over maritime matters that can only be taken away by clear and explicit statutory language. The provisions of the Canada Shipping Act granting jurisdiction over fatal accident claims to the "Admiralty Court" (which is defined as the Federal Court) do not expressly exclude superior court jurisdiction. Therefore the superior courts have concurrent jurisdiction with the Federal Court over maritime claims.
-
The determination of whether a provincial statute is constitutionally applicable to a maritime negligence action involves a four part analysis:
Step 1: First, it must be determined whether the matter at issue is within the exclusive federal legislative competence over navigation and shipping,
ie. is the subject matter under consideration so integrally connected to maritime matters so as to be legitimate Canadian Maritime
Law;
Step 2: If the answer to step 1 is yes, the second step is to determine whether Canadian Maritime Law provides a counterpart to the statutory provision. If it does, Canadian Maritime Law applies;
Step 3:If there is no counterpart provided by Canadian Maritime Law, the third step is to consider whether the non-statutory Canadian Maritime Law should be altered in accordance with the principles of judicial reform established by the court,
ie. to reflect the changing social, moral and economic fabric of the country. Such changes should only be incremental. Changes with complex or uncertain ramifications should be left for the legislature. Additionally, in making changes to Canadian Maritime Law the courts should consider the fabric of the broader international community of maritime states and the desirability of maintaining uniformity in maritime law;
Step 4: Finally, and only if the matter cannot be resolved through the application of steps 1 through 3, the court must determine whether the provincial statute is constitutionally applicable to a maritime claim. The Supreme Court noted that matters within exclusive federal jurisdiction are subject to provincial statutes of general application provided the provincial laws do not go to the core of the federal jurisdiction. If they do, they will be read down. The Court held that Maritime negligence law is a core element of federal jurisdiction over maritime law and that it would therefore be constitutionally impermissible for a provincial statute to regulate this area of law. The Court cautioned that they were not saying that no provincial statute could ever apply in any maritime context, however, the Court was of the opinion that this would be a relatively rare occurrence.
-
With respect specifically to the application of the Ontario Family Law Act to boating accidents, the Supreme Court applied the above analysis and held that Canadian Maritime Law should be reformed to allow claims by dependants for loss of guidance, care and companionship in respect of both personal injury accidents and fatal accidents. The Court further held that "dependants" should include common law spouses but not siblings. Because the Court was able to incrementally reform Canadian Maritime Law to address the issues raised it did not need to consider the constitutional applicability of the Family Law Act (step 4) except with reference to whether siblings could be plaintiffs and, on this issue, the Court held the Family Law Act should be read down so as not to apply to maritime negligence actions;
-
With respect to the application of the Ontario Trustee Act, the Supreme Court also held that Canadian Maritime Law should be reformed to allow a claim by an executor of a deceased. Accordingly, the Court did not decide the constitutional applicability of the Act;
-
With respect to the application of the Ontario Negligence Act, the Supreme Court noted that Canadian Maritime Law includes a general regime of apportionment of liability resulting in joint and several liability and contribution among
tortfeasors. Thus, once again, having found a remedy in Canadian Maritime Law the Court did not address the constitutional question of whether the Negligence Act applied;
-
The final issue considered in the case was whether a fatal accident claim is subject to a one or two year limitation period. The issue arises because section 649 of the Canada Shipping Act provides that the limitation period for a fatal accident is one year whereas section 572(1), which deals with collisions, provides for a two year limitation period. The Court held that the plaintiff's claims prima facie came within section 572(1). The Court further held that the ambiguity created by the two sections must be resolved in favour of allowing the plaintiff to rely on the longer period.
Fatal Diving accident - Application of Canadian Maritime Law - Limitation Periods
Dreifelds v Burton, (March 6, 1998) No. C 2456 &: C24580 (Ont. C.A.) This was an appeal from a decision of the Ontario Court General Division. The case concerned a fatal scuba diving accident in Lake Ontario. A chartered vessel was used to take the divers to the dive site but the vessel was otherwise not involved in the accident. The deceased died from a gas embolism. The issue in the case was whether the accident was governed by Canadian maritime law and the one year limitation period in the Canada Shipping Act or by the two year period in the Ontario Family Law Act. Both at the trial level and on appeal it was held that the case was not governed by Canadian maritime law and that the two year period in the Family Law Act applied. The Court of Appeal noted that "not every tortious activity engaged in on Canada's waterways is subject to Canadian maritime law. Only if the activity sued about is sufficiently connected with navigation or shipping... will it fall to be resolved under Canadian maritime law." It is noteworthy that the Court of Appeal said, in obiter dicta, that if the case was governed by the one year limitation period in the Canada Shipping Act, the Court would nevertheless have the inherent jurisdiction to extend the one year limitation period and would have done so in the absence of any prejudice to the Defendants. (Editor's Note: Compare this to the decision of the British Columbia Supreme Court in Vogel v Sawbridge et.al.(April 3, 1996) No. 24638 Kelowna Registry
(B.C.S.C.) where that Court refused to recognize any such inherent jurisdiction.)
Contributory Negligence
Bow Valley Husky Ltd. v. St. John Shipbuilding Ltd.,
(December 18, 1997) No. 24855 (S.C.C.) This is an extremely important case that all maritime law practitioners should read carefully. The case involved a breach of contract and negligence claim relating to the building of an off shore oil platform owned by the Plaintiff. The significant maritime law issue was whether the Plaintiff's claim was barred by reason of contributory negligence. The Defendant argued that because the matter was governed by Canadian Maritime Law the Newfoundland Contributory Negligence Act, which would have apportioned liability, did not apply and the Plaintiff's claim was barred. The Supreme Court of Canada agreed that the Newfoundland Contributory Negligence Act did not apply to maritime torts. The court noted that the "(a)pplication of provincial laws to maritime torts would undercut the uniformity of maritime law". Nevertheless, the court said that this was "an appropriate case for ... an incremental change to the common law in compliance with the requirements of justice and fairness". The court held that the contributory negligence bar did not apply to maritime torts. This case is of significance not only because of the ruling on contributory negligence but also because the court dealt specifically with the so called "gap rule" (which holds that, for matters within the constitutional jurisdiction of both the provinces and the federal government, the provinces may legislate where the federal government has not done so). The court held that the absence of federal legislation did not mean there was a "gap" which the provinces could fill because the common law applied to fill any such gap. ( Although not specifically enunciated in the
judgement, presumably this is because the Federal Court Act enacts the common
law as Canadian Maritime Law.) The significance of this may be that no
provincial statute can ever apply to a matter governed by Canadian Maritime
Law.
Contribution and Indemnity
Canada v Mallett and Associates Engineering Ltd.,
(January 24, 1997) No. 127434 (N.S.S.C.).
This was an action against the Defendant for breach of contract and negligence in relation to dredging of the Liverpool Harbour and construction of a containment facility. The Defendant in turn brought Third Party proceedings against subcontractors. The Third Parties brought this application to strike out the Third Party proceedings on the grounds that they were governed by Canadian Maritime Law which did not recognize a claim for contribution and
indemnity. The Court refused to strike out the proceedings holding, first, that it was not clear the matter was entirely governed by Canadian Maritime Law and, secondly, that it was arguable whether there was a right to contribution and indemnity under Canadian Maritime Law.
Contributory Negligence
Newfoundland Processing Ltd. v The "South Angela", (September 23, 1996) Nos. T-457-88, T-584-90, T-620-90 (F.C.T.D.).
The Federal Court Trial Division held that the contributory negligence of the Plaintiff was not a bar to recovery. See the full summary under
Pollution. Fatal
Accidents - Application of Provincial Legislation
Vogel v Sawbridge et.al., (April 3, 1996) No. 24638 Kelowna Registry (B.C.S.C.);
Barker v Sawbridge et.al., (April 3, 1996) No. 24639 Kelowna Registry (B.C.S.C.).
This was a summary trial to dismiss two actions as time barred. The actions arose out of the deaths of two persons aboard the yacht "Kingfisher" while it was moored at Nanaimo
Harbour, British Columbia. It was alleged in the Statement of Claim that the deaths were caused by the faulty operation of a heater in the yacht which emitted high levels of carbon monoxide. The deaths occurred on December 22, 1992 but actions were not commenced until December 21, 1994. The Plaintiffs claimed relief under the Family Compensation Act of British Columbia. The British Columbia Supreme Court, following the earlier decision of the British Columbia Court of Appeal in Shulman v McCallum [1933] 7
W.W.R. 567, held that the actions were governed by Canadian Maritime Law and not the provincial Family
Compensation Act. Accordingly, the Court held that the actions were governed by the fatal accident provisions of the Canada Shipping Act and that the applicable limitation period was therefore the one year period provided by s.649 of that Act. The Court refused to exercise
any inherent jurisdiction to extend the limitation period stating that to do so would conflict with and abrogate the clear provisions of a statute which contained no curative provisions.
EDITORS NOTE: This decision should be read and relied upon with care
given the subsequent Supreme Court of Canada decision in Ordon v Grail.
Contributory Negligence
Conrad v Snair, (December 7, 1995) No. 109424 (N.S.C.A.).
The Nova Scotia Court of Appeal in obiter dicta held that Provincial contributory negligence apportionment legislation would apply to a collision governed by Canadian Maritime Law. See
summary under Collisions .
Provincial Court Jurisdiction –
Steamship Inspectors - Offshore Accord
Secunda Marine Services Limited
v The Queen et al., 2003 NSSC 2
This was an application to the Nova Scotia Supreme Court to
review the refusal of a Canada Steamship Inspector to issue a letter of
compliance. One of the issues in the case was whether the application should
have been brought in the Federal Court. The Nova Scotia Supreme Court held
that the application was properly within its jurisdiction since the matter
concerned the offshore area covered by the Nova Scotia Accord Act and
Canada Accord Act.
Federal Court Jurisdiction –
Enforcement of Foreign Arbitration Awards – Piercing Corporate Veil
Trans-Pacific Shipping Co. v Atlantic & Orient Trust Co. Ltd. et al.,
2005 FC 311
In this matter the Plaintiff shipowner had obtained an
arbitration award against one of the Defendants in London for breach of a
charterparty. The Plaintiff subsequently registered the award in the Federal
Court and then brought this action against the charterer and against various
related companies and the individual alleged to have effective control of
all of the Defendants. The relief claimed by the Plaintiff was a declaration
that the debts of the charterer were the debts of all of the Defendants and
a declaration that the assets of one of the Defendants were the assets of
the charterer. The Defendants brought this application challenging the
jurisdiction of the Federal Court arguing that the declarations sought were
matters of Property and Civil Rights and therefore within provincial
jurisdiction. The Prothonotary, however, held that enforcement of foreign
arbitral awards had long been considered within Federal Court jurisdiction.
Further, the Federal Court had the implied jurisdiction necessary to enforce
its judgements, including the recognition of the foreign arbitral award. The
Prothonotary next considered the issue of the piercing of the corporate veil
and concluded that it was arguable that the various Defendants were for many
purposes one and the same entity and thus should not be entitled to the
protection of incorporation as separate entities. The Prothonotary expressly
did not decide this issue but merely decided that it was not plain and
obvious the Plaintiff could not succeed. (Note: This case should be compared
with that of the British Columbia Court of Appeal in Pan Liberty
Navigation Co. Ltd. v World Link (HK) Resources Ltd., 2005 BCCA 206 (summary), and
TMR Energy Limited v. State Property Fund of Ukraine et al., 2005 FCA
28 (summary))
Jurisdiction - Rail Carriage
Herrenknecht Tunnelling Systems USA Inc. v Canadian Pacific Railway,
2002 FCT 1089
The issue in this case was whether the Federal Court had jurisdiction over a claim for damage
caused to cargo during the course of carriage from Quebec to Tacoma, Washington. The cargo
was damaged when the train derailed in Ontario. The Judge identified the test as being: 1. There
must be a statutory grant of jurisdiction by the federal parliament; 2. There must be an existing
body of federal law which is essential to the disposition of the case and which nourishes the
statutory grant of jurisdiction; and, 3. The law on which the case is based must a “law of Canada”
as the phrase is used in s. 101 of the Constitution Act. The Judge found the statutory grant of
jurisdiction in s.23(c) of the Federal Court Act which vests the court with jurisdiction in all cases
where a claim for relief or a remedy is sought in relation to works and undertakings connecting
one province with any other province. The second branch of the test was met by sections 113 and
116 of the Canada Transportation Act which oblige railways to receive, carry and deliver cargo
and which provide a right of action to any person against a railway for neglect or refusal to fulfill
its service obligations. Finally, the Judge held that the Canada Transportation Act was a “law of
Canada” within the meaning of s. 101 of the Constitution Act and hence satisfied the third branch
of the test.
Jurisdiction - Meaning of Ship
Cyber Sea Technologies Inc. v Underwater Harvester, 2002 FCT 794
One of the issues in this matter concerned whether a submersible device used to cut trees in a
flooded but unlogged reservoir was a ship so as to attract the admiralty jurisdiction of the Federal
Court. The Prothonotary referred to the definition of ship in the Federal Court Act, being, “any
vessel or craft designed, used or capable of being used solely or partly for navigation, without
regard to the method or lack of propulsion...”. The Prothonotary noted that this was a very
general and broad definition that seemed to encompass anything on or in the water and ultimately
concluded that the submersible was, in all probability, a ship and that the Federal Court therefore
had jurisdiction.
Jurisdiction
- Fisheries - Agency
Radil
Bros. Fishing Co. Ltd. v. Her Majesty the Queen et al., (19 October
2001) No. A-786-00 (F.C.A.)
The facts of this
case are quite complicated involving licence swaps, fishing quotas and catch
history. One of the issues in the case was whether the Federal Court had
jurisdiction to entertain a claim arising out of an agreement of purchase and
sale of a fishing licence. The Federal Court of Appeal concluded that such a
claim did not fall under section 91(10) of the Constitution Act (navigation
and shipping) as it was more specifically dealt with under section 91(12) (Sea
Coast and Inland Fisheries). The Federal Court of Appeal also extensively
reviewed the jurisprudence in relation to the definition of Canadian Maritime
Law and concluded that Canadian Maritime Law does not include a claim arising
out of an agreement to purchase a fishing licence or to matters arising out of a
breach of an agency contract entered into for the purpose of purchasing a
fishing licence. The Court of Appeal noted that agency claims cannot be
entertained under the court’s admiralty jurisdiction “ unless the true
essence of the contract relied upon is maritime”.
Jurisdiction
- Claims Against Insurance Brokers
Royal
& Sun Alliance v The “Renegade III”, 2001 FCT 1050 This case is fully
summarized under the heading “Admiralty Practice”. During the course of his
reasons the Prothonotary seemed to suggest that Canadian maritime law had
developed to the point where claims against brokers in a marine insurance
context might be within the jurisdiction of the Federal Court.
Jurisdiction - Claims against Crew Members - Inducing Breach
of Contract
Ruby Trading
S.A. v Parsons et al., (November 21, 2000) No. A-90-00 (F.C.A.), [2000] F.C.J. No.
1893
This matter concerned the jurisdiction of the Federal Court to
entertain an action by a foreign ship owner against foreign crew members for
breach of contract of employment and against a Canadian union for inducing
breach of contract. While the "Japan Rainbow II" was loading a cargo
of grain wage demands were made by the Defendants which were not satisfied by
the Plaintiff. A strike sign was posted on the ship which resulted in the
cessation of the loading activities. The Plaintiff then commenced this
proceeding and obtained an injunction restraining the picketing for 14 days. The
order granting the injunction was appealed but as the loading was completed
during the time the injunction was in effect the issue of the appropriateness of
the injunction was moot and the Court of Appeal declined to hear argument on
this point. The Court of Appeal did, however, agree to adjudicate the issue of
whether the Federal Court had jurisdiction to hear the claim of the Plaintiff.
The Defendant argued that it did not have jurisdiction as the claims were in
personaum and not in rem, did not fall within the maritime
jurisdiction of the court and jurisdiction was specifically assigned by the Canada
Labour Code to the Canada Industrial Relations Board. The Plaintiff argued
that the claims fell within the court’s admiralty jurisdiction.
The Court of Appeal reviewed the authorities and reiterated
that the test for jurisdiction was threefold: (1) there must be a statutory
grant of jurisdiction by Parliament; (2) there must be an existing body of
federal law essential to the disposition of the case that nourishes the grant of
jurisdiction; and (3) the law on which the case is based must be a "law of
Canada" as that phrase is used in s. 101 of the Constitution Act. The
Court of Appeal held that all three branches of this test had been met. The
statutory grant of jurisdiction was found in s. 22 of the Federal Court Act
and the nourishing law and the "law of Canada" was found in Canadian
maritime law. The Court of Appeal held that the claims advanced were integrally
connected with maritime matters as to be legitimate Canadian maritime law. The
Court of Appeal expressly held that it did not matter that the claims were in
personam and not in rem as the court had jurisdiction in either
event. The Court of Appeal further held that the Canada Labour Code had
no application as it did not govern relations between a foreign ship owner and a
foreign crew. In the result, it was held that the Federal Court had
jurisdiction.
Jurisdiction - Breach of
Agreement of Sale
John E.
Canning Ltd. v Tripap Inc., (April 5, 2000) No. T-477-98 (F.C.T.D.), [2000] F.C.J. No. 418
This was an application to dismiss the Plaintiff’s claim on
the grounds that it was not a maritime matter and the Federal Court lacked
jurisdiction. The claim arose from an agreement between the Plaintiff and
Defendant pursuant to which the Plaintiff had agreed to sell and deliver by
barge wood to the Defendant. The Defendant later purported to terminate the
agreement on the grounds that the Plaintiff had failed to perform its
obligations. The Plaintiff then brought this action alleging that the Defendant
breached the agreement without cause and sought damages including expenses
covering the barge. The Court held that, although the agreement between the
parties included some undertakings involving maritime matters, the sole claim
advanced of unlawful termination of a purchase and sale agreement had nothing to
do with the marine aspects of the agreement. In the result, the Court held that
it was without jurisdiction and dismissed the claim.
Jurisdiction - Warehousing
Pantainer
Ltd. v 996660 Ontario Ltd., (March 17, 2000) No. T-231-99 (F.C.T.D.), [2000] F.C.J. No.
334
One of the issues in this case was whether the Defendant’s
counterclaim against the Plaintiff for damage caused to cargo in a warehouse
after the carriage by sea was within the jurisdiction of the Federal Court as
coming under maritime law. The Court held that claims for warehousing and
storage that arose out of contracts of the carriage of goods by sea are within
the jurisdiction of the Court.
Third Party Jurisdiction - Stuffing of Container
Caterpillar Overseas S.A. v The "Canmar Victory" et al.,
(November 25, 1999) No.
A-488-98 (F.C.A.).
This was an appeal from a decision of the Trial Division denying a motion by
the Third Party Defendant for an order dismissing the Third Party Claim on the
grounds that the court lacked jurisdiction. The main claim by the Plaintiff was
for damage caused to an engine shipped in a container and carried from Chicago
to Denmark via the Port of Montreal. The Defendant brought Third Party
proceedings against the American company who was responsible for loading the
container. The Third Party challenged the jurisdiction of the Federal Court on
the grounds that its services were performed in Illinois and that there was
therefore not a sufficient nexus between it and the territorial jurisdiction of
the court. The Court of Appeal held that the stuffing of a container to be
placed on board a ship at Montreal was an undertaking of a maritime nature
integrally connected with the carriage of goods by sea. The Court of Appeal
further held that the knowing preparation of cargo for a marine voyage beginning
in Canada is an "act, conduct or agreement" that can be related in
personam to the territorial jurisdiction of the Federal Court.
Federal Court Jurisdiction Breach of Fishing Agreement
Inter Atlantic Canada ltd. v The "Rio Cuyaguateje", (2000) 180 F.T.R. 318 (F.C.T.D.)
This was an application to strike out the Statement of Claim and set aside
the warrant of arrest on the grounds that the Federal Court lacked jurisdiction.
The subject matter of the action was an alleged breach of an agreement relating
to the utilization and allocation of North Atlantic shrimp to Cuba. The court
held that this was not a claim involving Canadian maritime law and, therefore,
held that it was without jurisdiction and allowed the motion.
Jurisdiction of the Federal Court
- Land Lease
Corcovado yacht Charters Ltd. v Forshore Projects Ltd., (February 9, 1998) No. T-153-98 (F.C.T.D.)
The issue in this case was whether the Federal Court had jurisdiction to determine a dispute relating to the refusal of a landlord to renew a lease on a building that was, in part, built on pilings at Granville Island in False Creek, Vancouver. The Court held that the lease and its cancellation or non-renewal were in pith and substance matters within the property and civil rights jurisdiction of the provinces and not governed by Canadian maritime law. In the result, the Court declined jurisdiction.
Jurisdiction - Evidence on Motions
MIL Davie Inc. v Hibernia Management and Development Co.,
(May 7, 1998) No. A-314-97 (F.C.A.)
This was a motion by the Defendant to strike the Statement of Claim as being outside the jurisdiction of the Federal Court. The Plaintiff relied on the Competition Act as the jurisdictional basis for the claim. The Plaintiff alleged that the Defendants engaged in anti-competitive
behaviour, contrary to that Act, in the awarding of a construction contract. The Federal Court of Appeal reviewed the Statement of Claim and concluded that the Plaintiff had pleaded sufficient facts to invoke the Competition Act and the court's jurisdiction. In the course of its reasons the Court noted that there was some confusion in the caselaw as to whether a motion challenging the court's jurisdiction should be brought under Rule 401 or 419 and further noted that no evidence was generally allowed in a motion under Rule 419. The Court expressed the view that the prohibition against evidence in Rule 419(2) did not apply if the motion was to challenge the jurisdiction of the Court.
Federal Court Jurisdiction - Expenses paid by Shareholders - Practice - Affidavit to Lead Warrant
Jean v The "Capitaine Duval",
(June 26, 1998) No.T-536-98 (F.C.T.D.)
This was an application to strike out the Statement of Claim as being outside the jurisdiction of the Court. The Plaintiffs were former shareholders and officers of the Defendant. The claim was to recover various expenses paid by the Plaintiffs on behalf of the Defendant. The expenses were in relation to the construction of a vessel being built by the Defendant. The motions judge held that the Plaintiffs' claims were not maritime matters and were therefore outside the jurisdiction of the court.
In the course of his reasons the motions judge noted that an affidavit to lead warrant sworn by the Plaintiffs' solicitor had been based on double hearsay. The motions judge said that although signing such an affidavit might not be technically illegal it was most unusual and should not in normal circumstances be done.
Contribution and Indemnity
Ferguson v Arctic Transportation Ltd. et.al.,
(July 29, 1997) No. T-1941-93 (F.C.T.D.).
The issue in this matter was whether the Federal Court had jurisdiction to determine issues of contribution and indemnity raised in a Third Party action. The facts were that the Plaintiff, a pilot with the Panama Canal Commission, was injured on board a ship owned and operated by the Defendants while it was transiting the Panama Canal. The Defendant commenced Third Party proceedings against the Panama Canal Commission alleging that the Plaintiff's injuries were caused by the negligence of employees of the Commission. The Commission argued that the claim for contribution and indemnity was not a claim recognized by Canadian Maritime Law and was therefore not within the jurisdiction of the Federal Court. The Court, however, held that it did have jurisdiction as the claim related to
pilotage. The Court further noted that Canadian Maritime Law includes the law of torts.
Jurisdiction over motor carriers
Matsuura Machiner Corporation et.al. v. Melburn Truck Lines Ltd,
(March 12, 1997), Nos. A-213-96, A-220-96, A-221-96 (F.C.A.).
These three appeals concerned the jurisdiction of the Court over a road carrier in a through transit situation. Specifically, the Court considered whether s. 22(2)f (which grants the Court jurisdiction over claims "arising out of an agreement relating to the carriage of goods on a ship under a through bill of lading") supported jurisdiction against the road carrier. The Court of Appeal held that this section did not allow an action against a road carrier who was not a party to the through bill of lading.
Claim vs. Supplier of Packaging
Pakistan National Shipping Corp. v Canada (The Queen v. Grief Containers Ltd.), ,
(April 30, 1997), No. A-343-96 (F.C.A.).
This was an interlocutory application to strike a third party action on the grounds that the Federal Court had no jurisdiction over the subject matter. The main action was brought by the Plaintiff carrier against the Defendant shipper to recover expenses incurred when plastic drums containing the Defendant's cargo of canola oil began to leak and caused a collapse of stow. The Defendant, in turn, commenced Third Party proceedings alleging that the Third Party had negligently represented the quality and capacities of the plastic drums. The motions Judge allowed the Third Parties application to strike the Third Party claim. On appeal, the Court of Appeal noted that the claim was not simply for supplying defective drums but was for negligent misrepresentation and that the Third Party was well aware that the intended use of the drums was to transport oil by ships. The Court of Appeal held that the Court did have jurisdiction as the claim was integrally connected to the Court's admiralty and maritime jurisdiction.
Claim against
Sub-contractor
I. Deveau Fisheries Ltd. v Cummins Americas, Inc.,, (June 17, 1996) No. T-1312-95 (F.C.T.D.).
The Federal Court Trial Division held that a Third Party claim against a sub-contractor of a ship repairer was governed by Canadian Maritime Law and within the admiralty jurisdiction of the Court. See the full summary under Admiralty Practice
Jurisdiction over Rail Carriers
Marley Co. v Cast North America (1983) Inc. et.al., (March 31, 1995), No. T-2718-93, (F.C.T.D.).
The Plaintiff in the case had entered into a contract with CAST for the carriage of a container of goods from Illinois to Holland via Montreal. CAST in turn entered
into a contract with a rail carrier for carriage of the container to Montreal. The container was damaged while being loaded in Illinois. The Plaintiff joined both CAST and the rail carrier as Defendants. The rail carrier brought a motion to dismiss the claim on the basis that the Federal
Court was without jurisdiction. The Court held that its maritime jurisdiction under section 22(2)(f) of the Federal Court Act did not extend to the rail carrier because the rail carrier was not a party to the through bill of lading. The Court held that section 22(2)(f) only gives it jurisdiction against the actual parties to the through bill of lading. Accordingly, section 22(2)(f) would give the Court jurisdiction against CAST but not the rail carrier. The Court went on, however, to dismiss the rail carrier's motion on the grounds that it was possible the Court might have jurisdiction pursuant to
section 23(c) of the Federal Court Act. Section 23(c) gives the Federal Court jurisdiction over extra-provincial works and undertakings. The Court found that there was insufficient evidence to determine this issue. |
