Developments in Canadian Maritime Law 1999

I.     Marine Insurance

II.    Carriage of Goods

III.   Arbitration/Jurisdiction Clauses

IV.   Canadian Maritime Law

V.    Limitation of Liability

VI.   Admiralty Practice

VII.  Federal Court Jurisdiction

VIII. Mortgages, Liens and Priorities

X.    Miscellaneous  

Appendix: TABLE OF CASES 

 

I. Marine Insurance

Fraser River Pile & Dredge Ltd. v Can-Dive Services Ltd., 
[1999] 3 S.C.R. 108 (S.C.C.).

This was an action by the owners and underwriters of the derrick barge "Sceptre Squamish" against the charterer of the barge. The "Sceptre Squamish" was lost in the Strait of Georgia when it was left by the charterer unattended in heavy weather. The charterer defended the action alleging that the loss of the barge was due to the negligence of the owner, that there was an agreement that the owner would insure the barge for the benefit of the charter, and that the action, which was a subrogated action by hull underwriters, was barred by reason of a waiver of subrogation and "additional insureds" clause in the hull policy. The waiver of subrogation clause waived subrogation against charterers. The "additional insureds" clause gave the owner permission to charter and made the charterer an additional insured under the policy. The owners and underwriters argued that the charterer was not entitled to rely on these terms because it was not a party to the policy and because the owners and underwriters had executed an agreement following the loss in which they agreed to proceed with legal action against the charterer and in which the owner waived any rights it had under the waiver of subrogation clause. At trial (reported at (1995), 9 B.C.L.R. (3d) 260), the court held that the loss of the barge was due to the negligence of the charter, that there was not sufficient evidence of an agreement to insure, and that the doctrine of privity applied to prevent the charterer from relying upon the waiver of subrogation and "additional insureds" clauses. On appeal (reported at (1997), 39 B.C.L.R. (3d) 187), the British Columbia Court of Appeal upheld that part of the trial judgement holding that there was no agreement to insure. The Court of Appeal then embarked on a lengthy analysis of the doctrine of privity and concluded that the doctrine of privity no longer applied to prevent a third party from taking the benefit of a waiver of subrogation clause. The Court of Appeal further held that the agreement entered into between underwriters and owners following the loss was ineffective as the charterers rights had crystallized upon the happening of the loss. On further appeal to the Supreme Court of Canada, the Supreme Court upheld the decision of the Court of Appeal. The Supreme Court held that new exceptions to the doctrine of privity must meet a two part test: 1. the parties to the contract must intend to extend the benefit to the third party seeking to rely on the contractual provision; and 2. the activities performed by the third party must be the very activities contemplated as coming within the scope of the contract in general, or the provision in particular, as determined by reference to the intentions of the parties. Applying this two part test, the court found that there could be no question that owners and underwriters intended to extend the benefit of the waiver of subrogation clause to a class of third parties (charterers) that included the charterer and that the relevant activities arose in the context of the charter relationship, the very activity anticipated in the waiver of subrogation clause. With respect to the agreement entered into between underwriters and owners following the loss, the Supreme Court agreed with the Court of Appeal that the happening of the loss crystallized the charterer’s rights and that the waiver of subrogation clause could thereafter not be amended without the agreement of the charterer.

Trenton Cold Storage Ltd. v St. Paul Fire & Marine Insurance Co., 
(1999), 11 C.C.L.I. (3d) 127, (Ont. Ct. Gen. Div.).

Although not a marine insurance case this decision relates to an issue that marine underwriters are often called upon to deal with. The case concerned a fire at the assured's warehouse which resulted in damage to goods belonging to one of its customers. The assured had two liability policies; a warehouseman's legal liability policy and an umbrella excess policy that also provided comprehensive general liability coverage. The insurer under the warehouseman's legal liability policy settled the claim with the assured's customer and sought a 50% contribution from the insurer under the second policy. The court first considered whether the second policy was a true umbrella policy and held that it was not. The court next considered the "Other Insurance" clauses in the two policies. The clauses were virtually identical, each providing that their own insurance was excess. The court held that the two clauses were mutually repugnant and cancelled each other out. In result, both underwriters were required to share equally in the settlement. The insurer under the second policy was not, however, required to contribute to the defence costs as these costs were excluded in its policy.

Commercial Union Assurance Company PLC. v M.T. Fishing Co. Ltd., 
(1999), 162 F.T.R. 74, (F.C.T.D.), affirmed (1999) 244 N.R. 372, (F.C.A.).

In this matter the Plaintiff insurers paid out a fire damage claim. Subsequently, it was learned that the fire may have been intentionally set. The insurers then instituted a fresh investigation into these allegations which ultimately resulted in commencement of the present action to recover the insurance moneys paid. At issue in this motion was whether the reports and information subsequent to the commencement of the second investigation were privileged from production. The court at first instance reviewed the law of privilege and ultimately held that the dominant purpose of that investigation was to commence an action to recover the insurance moneys paid out. Indeed, the court could see no other reason for such investigation. On appeal to the Federal Court of Appeal, it was noted that the motions Judge did not determine if litigation was in reasonable prospect when the reports were prepared or whether litigation was the dominant purpose for the creation of the reports. The Court of Appeal noted that this was because counsel had agreed that they could determine what documents and information had to be disclosed if the Judge merely determined whether the dominant purpose of the investigation was to commence an action to recover the insurance moneys paid. In light of this agreement, the Court of Appeal found no error in the finding of the motion Judge and dismissed the appeal.

Russell v Canadian General Insurance Co., 
(1999), 11 C.C.L.I. (3d) 284, (Ont. Ct. Gen. Div.).

In this matter the Plaintiff claimed under an all risks marine policy for damage caused to a sailboat by the accumulation of water in the interior of the vessel. The damage to the sailboat occurred during the period from 1990 to 1993. The assured put the vessel into storage at the end of the summer in 1990 and left it in storage until October 1993 when it was discovered to be full of water. The accumulation of water had rendered the vessel a constructive total loss. The insurer denied coverage on the basis that there was wilful misconduct on the part of the assured, that the Plaintiff "courted the risk" and that the damage was caused by wear and tear, an excepted peril under the policy. There was conflicting evidence as to whether the assured periodically inspected the vessel while it was in storage. The assured testified that he did periodically inspect the vessel. The insurer led expert evidence to the effect that the assured could not have possibly inspected the vessel given the amount of water that had accumulated. The court, however, held that there was no requirement that the assured inspect the vessel. The court also held that there was no "wilful misconduct" on the part of the assured as he did not intend to damage the vessel and there was no deliberate courting of the risk as the damage was not foreseen. Additionally, the court found the damage was not caused by wear and tear as the damage was highly unusual and not the result of an occurrence ordinarily to be expected.

Laing v Boreal Pacific, 
(1999), 163 F.T.R. 226 (F.C.T.D.)

This was a claim under a marine insurance policy for the loss of an excavator. The excavator was loaded on the self propelled barge, "Palaquin", and was being carried across the Strait of Georgia. During the crossing the seas became rough and the excavator shifted and ultimately fell overboard. The Plaintiff settled an action brought by the owner of the excavator and brought this action for indemnity pursuant to the terms of his insurance policy. The Defendant insurer denied the claim on the basis that the vessel was unseaworthy at the commencement of the journey. The trial judge agreed with the insurer. She found that the barge was unseaworthy in that it was too heavily laden for the sea conditions that could reasonably be expected and the excavator was not properly secured. She further found that the Plaintiff had knowledge of the facts that made the vessel unseaworthy. In result, the Plaintiff's action was dismissed.

II. Carriage of Goods

Canadian Pacific Forest Products Limited et al. v The"Beltimber" et al., 
(1999), 175 D.L.R. (4^th) 449, (F.C.A.).

This was an appeal from a decision of the Trial Division. The case involved the loss of a part cargo of lumber carried on deck from Canada to Europe. The bills of lading were claused "on deck at shipper's risk" and clause 8 of the bill of lading was a "liberty" clause which specifically allowed the carrier to stow goods on deck. It provided that: "Goods stowed on deck shall be at all times and in every respect at the risk of the shipper/consignees. The carrier shall in no circumstances whatsoever be under any liability for loss of or damage to deck cargo, howsoever the same may be caused...". The Plaintiff argued, inter alia, that this clause did not protect the carrier as it did not include an express reference to negligence. The trial judge agreed with the Plaintiff and further noted that the express references to negligence in the "Both to Blame" and "Transshipment" clauses of the bill of lading implied negligence was not excluded in clause 8. On appeal, the Federal Court of Appeal agreed with the Trial Judge that negligence was not excluded. The Federal Court of Appeal held that the liability of a carrier of goods by sea is not confined to acts of negligence. Such a carrier is liable for failing to deliver the goods safely and for breach of the implied warranty of seaworthiness as well as for negligence. Because of the existence of these other heads of liability, the failure to include an express reference to negligence in the exclusion clause was fatal. The Federal Court of Appeal expressly distinguished the case of Mackay v Scott Packing and Warehousing Co., [1996] 2 F.C. 36 (C.A.) in which a similarly worded clause was held sufficient to exclude liability for negligence. In doing so, the court noted that the Defendants in the Mackay case were freight forwarders who did not have the common law liabilities of a carrier by sea.

Morlines Maritime Agency Ltd. v IKO Industries Ltd., 
(December 7, 1999) No. T-2522-96 (F.C.T.D.).

The issue in this case was whether the shipper was liable for the ocean carrier's freight charges when it had already paid the freight forwarder who went bankrupt without paying the carrier. The court relied upon the decision in C.P. Ships v Les Industries Lyons Corduroys Lte., [1983] 1 F.C. 736, where it was held that the debtor/shipper must pay the creditor/carrier his freight charges unless the shipper establishes either:

1. that the carrier authorized the third party/forwarder to receive the money on his behalf, or,

2. that the carrier held the third party/forwarder out as being so authorized, or

3. that the carrier by his conduct or otherwise induced the shipper to come to that conclusion, or

4. that a custom of the trade exists to the effect that both carrier and shipper would expect payment to be made to the third party/forwarder.

The court held that the third and fourth branches of this test had been met. The court relied upon the fact that the carrier never dealt directly with the shipper and never advised the shipper that it expected payment from them. Even after the forwarder began to have financial difficulties the carrier never contacted the shipper. This was conduct, the court held, that induced the shipper to believe that the forwarder was authorized to receive payments on behalf of the carrier. With respect to the fourth branch of the test, the court was satisfied that both the carrier and shipper expected the shipper to make payment to the forwarder and the forwarder to make payment to the carrier.

Riva Stahl GmbH v The "Bergen Sea" et al.,  
(1999), 243 N.R. 183, (F.C.A.).

This was an appeal from a decision of the Trial Division in which an application for summary judgment by the Defendants based on a time limitation defence was allowed. The case illustrates the dangers to Plaintiffs of suit time extensions. The Plaintiffs in the case obtained a suit time extension from the shipowner to June 13, 1995. This extension was conditional on the Plaintiffs obtaining a similar extension from charterers. The Plaintiffs did obtain a suit time extension from charterers but it was to a date of June 30, 1995. This extension was also conditional on the Plaintiffs obtaining a similar extension from owners. The Plaintiffs were unaware of, or failed to appreciate that, the extensions were not similar in that they expired on different days. The Plaintiffs issued a Statement of Claim on June 28, 1995, two days before the charterer's extension expired but after the owner's extension had expired. Both Defendants brought a summary judgment application to dismiss the action as being out of time. The Trial Division granted the application holding that there was no binding agreement to extend suit time to either June 13, 1995 or June 30, 1995, and further holding that the Defendants had not waived the time bar defence and were not estopped from raising it by reason of their continued negotiations with the Plaintiffs. The Court of Appeal agreed with the Trial Judge that there were no effective time extensions in place when the action was commenced and that there was no waiver or estoppel. 

Barzelex v The "EBN Al Waleed", 
(November 29, 1999) No. T-38-96 (F.C.T.D.).

In this matter the bill of lading contained a general paramount clause incorporating the Hague Rules as enacted in the country of shipment. The country of shipment was Turkey. However, Turkey had enacted the Hague Rules twice into its legislation. Initially, the Rules were enacted through ratification of the convention. This enactment gave a limitation of 100 pounds sterling gold value (approximately $12,500) per package or unit. Later the Rules were enacted as part of Turkey's Commercial Code. This enactment, as amended, gave a limitation of 100,000 Turkish Lire (approximately $2.31) per package or unit. At issue in the case was which of these limitations applied. The Plaintiff argued and led expert evidence that the enactment in the Commercial Code applied only to internal shipments. The court found as a fact however that under Turkish law the Commercial Code applied to international shipments as well as internal shipments. The Plaintiff then argued that a $2.31 limitation per package or unit was unconscionable and should not be enforced. The court, however, held that it was the result of a contractual provision which the Plaintiff could have avoided by declaring a value for the goods.

MacKay v Scott Packing & Warehousing Co., 
(1999), 164 F.T.R. 6, (F.C.T.D.).

This was a reference to determine the damages of the Plaintiff based upon a limitation of liability clause contained in the contract of carriage. The limitation clause limited the defendant's liability to 10 pounds sterling per cubic foot of the cubic capacity of the item lost or damaged or, at the Defendant's option, to the cost of repair or replacement. The Plaintiff argued that as the Defendant did not measure the cubic capacity of the articles upon shipment that it should not be entitled to limit its liability. The court disagreed. The Defendant sought to have its liability in respect of some items limited by the repair or replacement option. The court, however, held that the Defendant had not exercised the repair or replacement option and was therefore not entitled to limit its liability on this basis. The court awarded the Plaintiff pre-judgment interest compounded semi-annually. With respect to costs, the court awarded the Plaintiff its costs up to the time of the Defendant's settlement offer. Thereafter, the Defendant was awarded costs.

Kanematsu GMBH v Acadia Shipbrokers Limited et al., 
(1999), 163 F.T.R. 301, (F.C.T.D.).

This was a motion for summary judgment by the Plaintiff against the Defendant charterers for having induced the ship owner to deliver up the cargo to a third party without proper presentation of the bill of lading. The party to whom the cargo was delivered was the notify party on the bill of lading but it never paid for the cargo and, therefore, never received the original bills of lading. The Defendants argued that the case was not appropriate for summary judgment as the facts were too complex. The court, however, held that the fundamental issue was whether the cargo had been delivered without the surrender of the original bill of lading. As this was admitted, summary judgment was granted.

Westwood Shipping Lines v Geo International Inc. et al.,
(1999), 165 F.T.R. 290, (F.C.T.D.).

This was an action for fraudulent misrepresentation against the General Manager of the corporate Defendant. The corporate Defendant was the "Notify Party" on order bills of lading. The corporate Defendant obtained delivery of the cargo from the Plaintiff without surrendering the original endorsed bills of lading and without paying the purchase price to the shipper/vendor. In an earlier summary judgment motion ( Reasons dated June 24, 1998) the Plaintiff obtained judgment against the corporate Defendant and its President for conversion. The Plaintiff now sought judgment against the General Manager. The evidence established that the General Manager convinced the Plaintiff to release the goods by advising they were urgently needed and by representing that the original bills of lading would be forwarded when received. The Plaintiff argued that the General Manager knew the bills of lading would never be forwarded or was wilfully blind. The court, however, was not convinced that the General Manager had acted fraudulently. The court noted that, at the time, the corporate Defendant was a going concern and was receiving fifty to sixty containers per year. The court found it difficult to believe that the General Manager knew the goods would not be paid for. In result, the action was dismissed.

Kodak v Racine Terminal (Montreal) Ltd., 
(1999), 165 F.T.R. 299, (F.C.T.D.).

This was an application for summary judgment by a cargo owner for damage to a shipment of paper. The cargo was damaged by the crane operator of the Defendant terminal during unloading. The only issue in the case was whether the terminal could rely upon a Himalaya clause contained in the bill of lading. Although there was no written contract between the terminal and the ocean carrier authorizing the ocean carrier to insert a Himalaya clause, the terminal sought to rely upon a contract with the predecessor of the current carrier, whose business the current carrier had acquired. This contract, however, contained a clause prohibiting assignment unless consented to in writing. Express written consent was never obtained. The court held that failure to obtain the prior written consent was fatal. The court further held that the clause requiring written consent was fatal to the Defendant's alternate argument that there had been a novation of the contract. In result, the terminal was not entitled to rely upon the Himalaya clause.

Voest-Alpine Stahl Linz GmbH v The "Federal St. Clair" et al., 
(August 31, 1999) No. T-1296-95 (F.C.T.D.).

This was an action for damage to 35 steel coils. The coils were manufactured in Austria and carried by barge to Antwerp where they were loaded on board the Defendant vessel and carried to Montreal. A pre-loading survey at Antwerp noted some minor rusting to the coils. The cargo was not surveyed at Montreal. It was carried from Montreal to the consignee's premises where it was put in storage. Approximately two months later, when the coils were unrolled for use, they were discovered to be in a rusted condition. They were then surveyed and the surveyor concluded that the damage was attributable to contact with water in the vessel's holds (although only one of five samples indicated salt water contamination). The Defendants argued that the Plaintiff had failed to prove the damage occurred while the cargo was in its possession. The court, however, held that the Plaintiff had proven on the balance of probabilities that the damage occurred during the voyage from Antwerp to Montreal. The court further held that the burden was therefore on the Defendants to show the damage was caused by an excepted peril and that they had exercised due diligence to make the vessel seaworthy. The Defendants failed to discharge this burden. A secondary issue in the case was whether the time charterer of the vessel was liable together with the vessel's owner. On this issue the court held that the usual role of the time charterer is to find space on a vessel. Once it has booked the space the carrier or the owner issues the bill of lading which becomes the contract of carriage. The court found no specific undertaking by the time charterer to carry the goods and therefore the case against it was dismissed.

Haldane Products Inc. v United Parcel Service Canada Ltd., 
(May 14, 1999) No. 23258 (Ont. S.C.).

Although not a sea carriage matter, this case is nevertheless of interest. The Plaintiff entered into a contract with UPS for the carriage of cargo to Vancouver. The contract was governed by UPS's service conditions which were provided to the Plaintiff in advance. These conditions provided that the liability of UPS was limited to $100 for loss of or damage to cargo unless a higher value was declared. No value was declared for the shipment. UPS subcontracted the carriage to the second Defendant. During the course of the carriage the trailer caught fire and the Plaintiff's goods were lost. The court held that UPS was entitled to rely upon the limitation provision in its service conditions. The subcontractor, however, was held not be entitled to the benefit of the limitation clause. The court noted the decision of the Supreme Court of Canada in London Drugs Ltd. v Kuehne & Nagel International Ltd., (1992) 97 D.L.R. (4th) 261, and held that it would be implicit that employees of UPS would perform the obligations of UPS under the contract. The court reasoned that "if it is implicit that UPS would act through its employees, it follows that participation by subcontractors was implicitly excluded". In result, the subcontractor was not entitled to limit its damages.

III. Arbitration/Jurisdiction Clauses

Bill S-17, The Marine Liability Act, received first reading in the Senate on March 2, 2000. Section 46 of the bill provides that, if a contract for the carriage of goods by water to which the Hamburg Rules do not apply provides for the adjudication or arbitration of claims arising under the contract in a place other than Canada, a claimant may institute proceedings in Canada where:

(a) the actual port of loading or discharge, or the intended port of loading or discharge under the contract, is in Canada;

(b) the person against whom the claim is made resides or has a place of business, branch or agency in Canada; or

(c) the contract was made in Canada.

Once enacted, this provision will allow cargo claimants to commence proceedings in Canada notwithstanding the existence of a jurisdiction or arbitration clause in the bill of lading provided one of the above three conditions are met. Hence, the many stay applications based on jurisdiction and arbitration clauses will become a thing of the past.

Z.I. Pompey Industrie v Ecu-line N.V., 
(December 21, 1999) No.T-98-98 (F.C.T.D.),

This was an appeal from a decision of the Prothonotary (rendered September 22, 1999) in which the Prothonotary denied the Defendant's application for a stay of proceedings based on a jurisdiction clause in the bill of lading. The Prothonotary first considered the usual factors that are weighed on a stay application and determined that the balance of convenience was marginally in favour of granting the stay. However, even though the bill of lading called for the cargo to be shipped from Antwerp and discharged at Seattle, the cargo was, in fact, discharged at Montreal and carried further by rail to Vancouver. The Prothonotary held that this was an unreasonable deviation that brought the bill of lading contract to an end at Montreal. Accordingly, the Prothonotary held the Defendant was not entitled to rely upon the jurisdiction clause in the bill of lading. On appeal, the court held that the Prothonotary had taken into account all of the circumstances of the case and did not err by taking into the account the breach of contract by the Defendant.

Itochu Canada Ltd. v The "Fu Ning Hai", 
(August 17, 1999) No. T-1102-98 (F.C.T.D.).

This was an application for a stay of proceedings based on a Korean jurisdiction clause in the bill of lading. The stay was refused. The factors that led the court to deny the stay were many. First, the proceeding was against multiple Defendants, only one of whom requested the stay. The court considered that a stay would result in a multiplicity of proceedings with the possibility of inconsistent decisions. Second, the court found there was sufficient reason to refuse the stay in the fact that the Defendant had not agreed to waive the time bar that would otherwise apply to any Korean action. Third, the court considered that the lack of formal discovery procedures in Korea was a substantial point against allowing a stay. Fourth, the court noted that counsel for the Defendant had initially requested and been given a time extension to file a defence and had further advised the Plaintiff that they would make an application for late filing of their Statement of Defence. The court considered that this raised an estoppel and was a strong reason to deny the stay. Finally, the court noted that the Defendant's delay in bringing the stay application was also a strong reason to deny the stay.

Anraj Fish Products Industries Ltd. v Hyundai Merchant Marine Co. Ltd., 
(December 10, 1999) No.T-1571-99 (F.C.T.D.).

This was an appeal from a Prothonotary's decision allowing a motion for a stay of proceedings based on a jurisdiction clause in the bill of lading in favour of Korea. The underlying action was for damage to a cargo of fish shipped from Bangladesh to New York. The applicable law was probably American. The accident giving rise to the damage allegedly occurred in France and the negotiation of the bill of lading took place in Toronto. The Plaintiff, a Canadian company, filed affidavit evidence that it would be prohibited from pursuing the claim in Korea because of the expense. The motions judge reviewed the various factors and noted that the only connection with Korea was that the head office of the Defendant was located there. She found that as between Canada and Korea the evidence would be more readily available in Canada and at less expense. She therefore concluded that Canada was the more appropriate forum, allowed the appeal and denied the motion for a stay.

Town Shoes Limited v Panalpina Inc. et al., 
(1999), 169 F.T.R. 267, (F.C.T.D.).

This case concerned the theft of a container of shoes carried by the Defendants from Italy to Montreal. The theft occurred at a Montreal warehouse. The Defendants brought this motion to stay the proceedings pursuant to a law and jurisdiction clause in the bill of lading that provided for the exclusive jurisdiction of the Court of Hamburg and the application of German Law. The court denied the stay on the grounds that the choice of law clause was inconsistent with the Clause Paramount which provided for the application of the Canadian Carriage of Goods by Water Act. Additionally, the court held that there were strong reasons for denying the stay as the evidence and witnesses were in Quebec, the Defendants had little connection with Germany, and the Defendants would suffer no prejudice if the case were heard in Canada. The court further concluded that the Defendants did not have a genuine desire to have the trial take place in Germany.

Cerco Industries Ltd. v The "OOCL Canada", 
(November 16, 1999) Vancouver Registry No.C990101 (B.C.S.C.).

This was an application for a stay of proceedings based on a jurisdiction clause in the bill of lading in favour of Belgium. The court noted that a stay should be ordered unless the Plaintiff showed "strong cause" for not doing so and that the "strong cause" the Plaintiff must show goes beyond mere balance of convenience. The court further noted that it should show deference for forum selection clauses in commercial matters. The Plaintiff argued that the stay should be refused on the basis that it would be costly, inefficient and inconvenient to determine the dispute in Belgium and that a stay would result in duplicitous proceedings. Although the court accepted that the balance of convenience probably favoured British Columbia, this was not sufficient, and the court ordered the stay.

Thyssen Canada Limited v Mariana Maritime S.A. et al., 
(1999), 167 F.T.R. 105, (F.C.T.D.).

This was a motion to stay proceedings and refer the matter to arbitration pursuant to an arbitration clause contained in a charter party and incorporated by reference in the bill of lading. Clause 1 of the bill of lading expressly incorporated the charter party including any choice of law clause or arbitration clause. However, the details of the charter party were not filled in on the overleaf of the bill of lading. There were, in fact, two charter parties; a head charter and a sub-charter. Although both charters were subject to English law and called for English arbitration, the Plaintiff, the holder of the bill of lading, argued that there was no agreement to arbitrate as the details of the charter party were not filled in on the bill of lading. The court, however, held that clause 1 of the bill of lading was a sufficient agreement to arbitrate and that the failure to fill in the details of the charter party was not relevant. The court stayed the action.

Frontier International Shipping Corp. v The "Tavros", 
(November 5, 1999) No.T-2035-98, reversed in part (December 23, 1999) (F.C.T.D.).

In this matter the Plaintiff commenced proceedings to obtain security by arrest for arbitration proceedings in New York. Once the security was obtained the Plaintiff brought an application to stay the proceedings. The Defendant questioned the fairness of an arrest to obtain security for an arbitration and also requested counter-security for its counter-claim in the arbitration as well as security for costs for the arbitration and security for the costs of the Federal Court proceeding. The Prothonotary reviewed the authorities relating to the use of the court's in rem jurisdiction to obtain security for an arbitration and although he noted it had bothered judges from time to time he concluded that it was not open to the Defendant to urge any unfairness. He next considered the Defendant's request for counter-security. He accepted that Article 9 of the Commercial Arbitration Code gave the court the power to order interim measures of protection such as mareva injunctions, garnishment and arrest, however, these measures are based upon the presence in the jurisdiction of an asset which might be moved against. In the instant case there was no asset belonging to the Plaintiff in the jurisdiction. He next considered whether he could order that the Plaintiff post security for the costs of the arbitration. He held that this was the purview of the arbitrators, that the Federal Court Rules did not allow such security and that, in any event, there was not a demonstrated need for security. Finally, he considered the Defendant's request for security for costs of the Federal Court proceeding. Rather than ordering security for costs, however, he ordered that the Plaintiff pay costs to the Defendant as an interim measure of protection, including the costs of the security which the Defendant had posted. This latter part of the Prothonotary's order was overturned on appeal on the basis that it was not "interim protection" but was a final order.

IV. Canadian Maritime Law

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.)

The Queen v Kupchanko, 
(November 24, 1999) Cranbrook Registry No.9857 (B.C.S.C.).

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. The Crown successfully appealed. The court on appeal 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 court 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 court 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. (Note: It is difficult to reconcile this decision with that in The Queen v Will summarized above.)

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.

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.)

V. Limitation of Liability

Collisions - Limitation - Damage to Fishing Net

Capilano Fishing Ltd. v The "Qualicum Producer", 
(January 17, 2000) Vancouver Registry No. C072709 (B.C.S.C.).

This was an action for damages suffered during the 1997 herring fishery when the Defendant's vessel cut the net of the Plaintiffs' vessel. The Plaintiffs claimed damages for the net, for the value of the lost catch and for the costs of fishing licences thrown away. The Defendants denied negligence and claimed the right to limit liability. On the issue of liability the court found that the Master of the Defendant vessel was negligent in that he was aware of the Plaintiff's vessel yet maneuverer his vessel in a direction that ultimately led to the collision. With respect to damages, the court held that the damages should be calculated in accordance with the method established in Wishing Star Fishing Co. v The "B.C. Baron", [1987] F.C.J. No. 161, being the total catch divided by the number of vessels less the fish actually caught. The court denied the Plaintiffs’ claim based on unjust enrichment holding that such a claim was not available on the facts of the case. On the matter of limitation, the court found that the Defendant vessel was well equipped and had a competent Master and crew and, therefore, held that the Defendants were entitled to limit their liability to the amount of approximately $40,000.00. (Note: This case was decided under the old limitation of liability regime. Under the new regime the limitation amount is substantially higher ($500,000.00 for vessels under 300 tons) and the owner is entitled to limit unless the claimant establishes a personal act or omission committed with intent to cause loss, or recklessly, with the knowledge that loss would probably result.)

Bayside Towing Ltd. v Canadian Pacific Railway Company, 
(February 2, 2000) No. T-1692-99 (F.C.T.D.).

This was a limitation action by the owner of the tug "Sheena M" in relation to a collision between the barge "Rivtow 101" in tow of the "Sheena M" and a railway bridge owned by the Defendant. The Defendant challenged the right of the Plaintiff to limit liability pursuant to the 1976 Convention. The Plaintiff brought this application to strike out portions of the Statement of Defence. The court ordered that those portions of the Statement of Defence referring to faults allegedly committed by the owners of the tow be struck on the grounds that they were not relevant to whether the tug owner could limit liability. The court also struck out those portions of the Statement of Defence alleging mere negligence on the grounds that negligence has nothing to do with the test set out in Article 4 of the Convention for breaking limitation (i.e. personal act or omission committed with intent to cause loss, or recklessly, with the knowledge that loss would probably result). The court also struck out pleas of res ipsa loquitur, on the grounds that it was no longer applicable in Canada, and breach of statutory duty, on the grounds that it was not a recognized tort and was to be considered in the context of the general law of negligence. The court refused to strike out allegations of "wilful defaults", noting that concepts of wilfulness may be close to the test under the Convention. The court further refused to strike out an allegation that the tonnage for limitation purposes should be calculated on the combined tonnage of the tug and tow. The court doubted that the plea could succeed in the absence of common ownership of the tug and tow but it was not something that plainly and obviously would fail.

Canadian Pacific Railway Company v The "Sheena M" et al., 
(March 7, 2000) No. T-1887-99 (F.C.T.D.).

This is another action arising out of the collision between the barge "Rivtow 101" in tow of the "Sheena M" and a railway bridge. As a result of the collision $5 million in damage was caused to the bridge. Two actions were commenced following the collision; one by the owners of the "Sheena M" for limitation (the "limitation action") and the other by the Plaintiff for the damages occasioned by the collision (the "liability action"). This was an application by the owners of the "Sheena M" to stay the liability action pending the outcome of the limitation action and an application by the Plaintiff to consolidate the two actions. The court refused consolidation on the grounds that the two actions were incompatible for consolidation. The court noted that there were different issues, a conflicting burden of proof, and different standards of conduct at issue in the two actions. The court further noted that the limitation action should border on a summary procedure whereas the liability action would be a complex piece of litigation.

The Plaintiff raised two preliminary objections to the jurisdiction of the court to hear the stay application. First, the Plaintiff argued that the court was functus by reason of res judicata. This argument was based on the fact that the court had earlier made an order under section 581 of the Canada Shipping Act enjoining the Plaintiff and anyone else from commencing or continuing proceedings against the "Sheena M" interests in any court other than the Federal Court. The court held that it was not functus because enjoining an action and staying an action are two different proceedings and the same question is not decided on the two motions. The second preliminary objection raised by the Plaintiff was that section 581 of the Canada Shipping Act prevailed over section 50 of the Federal Court Act and section 581 did not provide for a stay. The court noted that the wording of section 581 had changed over time and that earlier versions specifically referred to a stay of proceedings. However, the court found that the drafters of the present wording of section 581 had enjoinment in mind and not stay. The court concluded that there was no conflict or tension between section 581 of the Canada Shipping Act and section 50 of the Federal Court Act. They dealt with different concepts.

With respect to the merits of the stay application, the court considered whether the test for granting a stay was to be governed by the two part test of Mon-Oil v Canada, (1989) 27 F.T.R. 50 (i.e. that the continuation of the action would cause prejudice or injustice to the applicant and not mere inconvenience and that a stay would not be unjust to the other side) or the three part test of RJR MacDonald Inc. v Canada, [1994] 1 S.C.R. 311 (i.e. that there was a serious issue to be tried, that the applicant will suffer irreparable harm if the stay is not granted, and that the balance of convenience favours the stay). The court held that the two part test was the appropriate one where the court is asked to stay its own proceeding whereas the three part test is appropriate for stays of tribunals or stays pending appeal. Applying the two part test, the court held that it would be prejudicial to the applicants if the stay was not granted since the liability action would be lengthy and complex and would result in the shutting down of the applicant's operations. The court further held that it would be unjust if the limitation procedure under the 1976 Convention was not allowed to unfold as it should which would result in reduced litigation. The court further held that there was no prejudice to the Plaintiff in ordering the stay as the limitation proceeding might do away with the need for the liability action and the Plaintiff would have full discovery and full ability to do whatever investigations and hire whatever experts they required.

VI. Admiralty Practice

Bow Valley Husky (Bermuda) Ltd. v  Saint John Shipbuilding Ltd., 
(1999) 181 Nfld. & P.E.I.R. 94, (Nfld. S.C.).

This was an application to determine the costs to be awarded the successful Defendant. The case is important because it illustrates how significant a cost award can be in a difficult and complex case. The action arose out of a fire on an oil rig. The trial of the action took 53 days and was followed by an appeal to the Newfoundland Court of Appeal and a further appeal to the Supreme Court of Canada. The case was a difficult and complex one. There were 26 applications and 13 pre-trial conferences. The successful Defendant asked for lump sum costs in excess of $3 million. The Plaintiff argued that the costs should be in the amount of approximately $500,000.00. The court ultimately awarded the Defendant $1.45 million. (Note: This award was not enhanced as a result of any double costs or enhanced costs rule based on a settlement offer.)

Trade Arbed Inc. v Toles Limited et al., 
(October 20, 1999) No. T-636-99 (F.C.T.D.).

This was an application to set aside the arrest of certain cargo belonging to the second Defendant. The underlying action was for breach of charter party. The Plaintiff had entered into a Gencon charter party with the first Defendant, the owner of the ship "Ideal", for the carriage of used axles to Newark on board the "Ideal". The second Defendant guaranteed the performance of the charter party by the owner and was also the shipper of a second cargo on the "Ideal". During the course of the voyage to Newark, the "Ideal" broke down and the Plaintiff was required to charter a second vessel to complete the voyage. The Plaintiff commenced arbitration against the Defendants in New York pursuant to the charter party and then brought this action against the Defendants in personam and against the cargo belonging to the second Defendant in rem to obtain security for the arbitration. The Plaintiff arrested the cargo belonging to the second Defendant. The court noted that the only claim against the second Defendant was that it had guaranteed the performance of the charter party by the vessel owner. The court held that this did not make the second Defendant's cargo "the subject of the action" within the meaning of section 43(2) of the Federal Court Act. Accordingly, the court set aside the arrest and struck out the in rem portions of the Statement of Claim.

Cold Ocean Inc. v The "Gornostaevka" et al., 
(1999), 168 F.T.R. 269, (F.C.T.D.).

This action concerned a claim by the Plaintiff for breach of a fishing agreement by the Defendant who was the demise charterer of the two Defendant ships. The Plaintiff arrested the ships and the cargo on board one of the vessels. The moving party, the sub-charterer of the ships and the owner of the cargo that had been arrested, brought the present motion for orders setting aside the warrants of arrest and striking out the Statement of Claim. The court reviewed the evidence and noted that it was clear that the Defendant was not the owner of the ships or cargo. Accordingly, the court held there was no in personam claim against the owner and an in rem action could therefore not be supported. The court set aside the arrest warrants and struck out the statement of claim.

B.C. Hydro & Power Authority v The "CSL Cabo" et al., 
(December 31, 1999) No. T-1194-98 (F.C.T.D.).

This was a motion to compel production of a report prepared by the Plaintiff. The evidence established that the Plaintiff was requested to prepare the report by its counsel. Plaintiff's counsel requested the report "for use in litigation". A later memo of the Plaintiff recorded that the report was required "for file and legal purposes". The Plaintiff claimed the report was protected from production by litigation privilege. The major issue on the motion was whose intention was relevant in determining whether the dominant purpose for the preparation of the report was for use in contemplated litigation. The court held that it was Plaintiff's counsel that procured the genesis of the report and that his intention ought to govern. Accordingly, the report was held to be privileged.

Barzelex v The "EBN Al Waleed", 
(December 30, 1999) No. T-38-96 (F.C.T.D.).

In this matter the Defendant had delivered two offers of settlement. The first was lower than the amount the Plaintiff was later awarded. The second was higher. The court held that the Plaintiff was entitled to normal costs up to the time of the second offer and the Defendant was entitled to double costs pursuant to Rule 420 from the date of the second offer. The court refused to take into account the first offer of the Defendant. The court further refused a request by the Defendant that the costs be calculated according to Column V of Tariff B. The court considered the point raised in the case, while novel, did not justify more than the normal costs. The court did, however, direct the taxing officer that when exercising his discretion as to the number of units to allow to choose at the higher end of the range allowed by Column III.

Pioneer Grain Company Ltd. v Far Eastern Shipping Co. et al., 
(December 15, 1999) No.T-891-94 (F.C.T.D.), affirmed (February 23, 2000).

This was an application to dismiss the Plaintiff's action on the grounds that the Plaintiff failed to comply with four successive orders of the court requiring production of specified documents. The court granted the order holding that the actions of the Plaintiff in ignoring the court orders amounted to an abuse of process.

James Fisher & Sons PLC v Pegasus Lines Limited S.A., 
(August 13, 1999) No.T-2161-98 (F.C.T.D.).

In this matter the court ordered that a representative of the general agent of the Defendant shipping line could be examined in aid of execution as an "officer" of the Defendant within the meaning of Rule 426. The court held that the term "officer" should not be restricted to the president, vice president and secretary. The term should be broadly defined and included anyone in positions of authority at the senior management level.

Richardson International Ltd. v The "MYS Chikhacheva", 
(1999), 166 F.T.R. 146, (F.C.T.D.).

In this case the court held that the cost of posting bail is an appropriate matter to factor into an award of security for costs. The court noted that local bonding costs might be a guide to the amount of security. The court reviewed the evidence as to the actual cost of posting the bail and ordered security for bail at 3.125% of the amount of the bail per year for two years. The court disallowed a request for 20% of the amount of the bail. This was the amount the Plaintiff's managers purported to charge the Plaintiff for arranging bail. The court considered this unreasonable.

Corner Brook Pulp & Paper Ltd. v Comm. Energy & Paper Workers Union, 
(July 23, 1999) No.T-1326-99 (F.C.T.D.).

This was an ex parte application for an injunction to restrain the Defendants from picketing the Plaintiff's wharf. The Defendants had erected a rope fence in the water opposite the Plaintiff's wharf and used small boats to allegedly interfere with vessels intending to dock at the wharf. The court noted that only in the most exceptional circumstances will an ex parte injunction be granted. There must be evidence that unlawful conduct created a situation of urgency. The court declined the order sought. First, the court considered that the Plaintiff had not made out a case of sufficient urgency. Second, although the court accepted that the matter fell within the maritime jurisdiction of the Federal Court, it was thought that the Provincial superior court was a more appropriate forum as the substance of the dispute was a labour matter.

VII. Federal Court Jurisdiction

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", 
(January 18, 2000) No. T-2282-99 (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.

VIII. Mortgages, Liens and Priorities

Fraser Shipyard & Industrial Centre Ltd. v The "Atlantis Two", 
(1999) 170 F.T.R. , varied in part (July 28, 1999) No. T-111-98 (F.C.T.D.).

This was a hearing to determine priorities to the sale proceeds of the Defendant vessel. The claimants and their claims were: a bunker supplier for bunkers supplied pursuant to a court order granting a priority as Marshall's expenses; the crew for wages; the Master for disbursements; the Crown for the costs of repatriating the crew; the charterer for bunkers supplied to the ship and for damages for breach of charter party; suppliers of necessaries claiming foreign maritime liens in respect of both goods supplied to the Defendant ship and goods supplied to sister ships; the sub-charterer for breach of charter party; the mortgagee; and a ship repairer, without possession, for work done to the vessel to remedy deficiencies noted in a Port State Control Detention Order.

The court allowed the claim of the bunker supplier pursuant to the previous court order as a first claim on the proceeds after the costs of sale. Next in priority was the claim of the crew and officers for wages and of the Master for disbursements for food for the crew, who had been abandoned by the owner. Next in priority was the claim of the Crown for the costs of repatriating the crew, which was a claim and priority that had been assigned to the Crown by the crew pursuant to an earlier court order.

The court next considered the claim of the charterer for fuel and damages for breach of charter party . With respect to the claim for fuel, the charterer claimed both for fuel consumed at Vancouver and for fuel on board the vessel when sold. The charterer’s claim for priority in respect of fuel consumed was disallowed by the court on the grounds that the charterer did not obtain a court order in advance of supplying fuel to the vessel. The court considered whether there were any special circumstances that might justify a variation in the normal order of priorities but held that there were no such special circumstances. The charterer was, however, entitled to the value of bunkers not consumed and on board the vessel when she was sold, this fuel being the charterer’s property. With respect to the charterer's claim for breach of charter party, the court held that the charter party made it clear that it was subject to English law and under both English and Canadian law there is only a statutory right in rem as a remedy for breach of a charter party and no priority.

With respect to the claims of foreign necessaries suppliers, primarily American suppliers, the court was invited to reconsider the fairness of allowing such suppliers a priority when their Canadian counterparts had only a right of action in rem. The court declined to do so but noted that it may be time for Canadian necessaries suppliers to press for legislative change. The court allowed the claims of all but one the American suppliers but only in respect of goods delivered to the "Atlantis Two". One claim allowed was in respect of goods supplied to the "Atlantis Two" at Mexico and Vancouver by a Norwegian company through an American agent. A claim that was disallowed at first instance was a claim in respect of cylinder heads sold F.O.B. Houston, Texas and delivered to Australia and Vancouver. The Prothonotary found that there was no evidence that the goods were, in fact, delivered to the vessel and held therefore that no maritime lien arose. On appeal, Rouleau J. found that the shipping invoices clearly indicated that the cylinder heads were to be shipped to a specifically identified vessel (the "Atlantis Two") in Australia and Vancouver. This, he held, was sufficient to establish delivery to the vessel and to find a maritime lien.

It is noteworthy that, insofar as the claims by American suppliers were for the supply of goods or services to sister ships of the "Atlantis Two", the court held that such claims did not attract a maritime lien and were mere rights of action in rem with no priority.

With respect to the claim of the sub-charterer for breach of charter party, the court held that this claim was governed by American law by virtue of an arbitration clause in the charter party calling for New York arbitration. The court considered the expert evidence that had been filed and concluded that pursuant to American law the sub-charterer had a maritime lien. Accordingly, the court found that the claim of the sub-charterer ranked ahead of the mortgagee. In doing so, the court acknowledged that this was a higher ranking than the sub-charterer would enjoy under American law. This result flows from the fact that the substantive nature of the lien is determined by American law yet the ranking of priorities is determined by Canadian law.

The court then turned to the claims of the mortgagee and the shipyard. The shipyard argued that it was entitled to priority over the mortgagee on two grounds: first, it argued that the mortgagee should lose its priority because it had been dilatory in enforcing the mortgage; second, it argued that the court in the exercise of its equitable discretion should grant it an enhanced priority because of the mortgagee’s delay in enforcing the mortgage and because the repairs done to the vessel (most, if not all repairs were done prior to the arrest) had added to the value of the vessel to the benefit of all creditors. With respect to the first argument the court accepted that a dilatory mortgagee might lose its priority if there was strong evidence the mortgagee knew money was being spent on the ship by the repairer and knew that the ship owner was insolvent. However, the court found as a fact that the mortgagee was not aware of the insolvency of the owner and was not fully apprised of the extent and value of the repairs being undertaken by the repairer. Accordingly, the court held that the mortgagee did not lose its priority. The court next considered whether it ought to exercise its equitable discretion to grant the shipyard an enhanced priority. The shipyard relied on various factors justifying an enhanced priority including that the repairs were done to correct deficiencies that had resulted in a detention order against the vessel being issued by Port State Control and that as a result of the work done by it the detention order was lifted and the value of the vessel was significantly enhanced. The shipyard argued that all of this increase in value would go to the mortgagee who had been dilatory in enforcing its mortgage if the usual ranking was not altered. The court ultimately agreed with the shipyard that there would be an unjust enrichment if the usual order of priorities was not altered. The court, therefore, granted the shipyard a priority equivalent to that of the American maritime lien claimants to the extent of US$220,000.00, being the increase in the value of the vessel consequent upon the repair work.

Holt Cargo Systems Inc. v The "Brussel", 
(February 11, 2000) No. T-738-96 (F.C.T.D.).

This was a hearing to determine priorities to the sale proceeds of the Defendant vessel. The claimants and their claims were: Holt Cargo Systems for costs of sale and Marshall's expenses; Halifax Port Corporation for port dues owed by the "Brussel" and her sister ships; Atlantic Pilotage Authority for pilotage services rendered to the "Brussel" and her sister ships; American maritime lien holders for goods and services supplied to the "Brussel" and to sister ships of the "Brussel"; the mortgagee for the mortgage debt; Canadian necessaries suppliers; and, the Trustee in Bankruptcy of the bankrupt ship owner. The court gave priority over the mortgagee to the claims of Holt Cargo Systems, the Halifax Port Authority, the Pilotage Authority and the various American maritime lien claimants who had supplied goods and services to the "Brussel". All of the other claimants ranked after the mortgagee, meaning they recovered nothing.

The claim of Holt Cargo Systems for the costs and disbursements related to the sale of the "Brussel" were granted a priority as were other costs which the court had previously ordered would be given a priority equivalent to Marshall's expenses.

The claim of the Halifax Port Corporation was granted a priority for port dues owed by the "Brussel" on the basis that section 43(5) of the Canada Ports Corporation Act gave it a priority over all other claims except the claims of seamen for wages. The Port Corporation was, however, not given priority for port dues owed by sister ships of the "Brussel". The court held that this claim was a mere statutory right of action in rem ranking behind the mortgagee.

The claim of the Atlantic Pilotage Authority was allowed and given priority for the services rendered to the "Brussel" but not for the services rendered to sister ships. In awarding the Pilotage Authority a priority the court noted that the Pilotage Act did not confer a priority, however, the Prothonotary was referred to Osborn Refrigeration Sales and Service Inc. v The Ship "Atlantean I", [1979] 2 F.C. 661, varied on other grounds 7 D.L.R. (4th) 395, and Ultramar Canada Inc. v Pierson Steamships Ltd. et al., (1982), 43 C.B.R. (N.S.) 9, which did grant a lien for pilotage services. On the basis of these authorities, and because the other claimants appeared to not contest the claim, the court granted the lien for pilotage services. (Note: The authorities on this point are not unanimous. In Ostogota Enskilda Bank v Starway Shipping Ltd., (1994), 78 F.T.R. 304 at 306, Muldoon J. said it had not been established "that there is in law a maritime lien for Canadian pilotage services". This decision was apparently not brought to the attention of the court in The "Brussel".)

With respect to the American lien claimants, the Trustee challenged the recognition of and the priority given to such liens and invited the court to reconsider these issues. The court held that the recognition and priority of such liens had been established by the Supreme Court of Canada and that it was not the role of the court to question established authority unless the circumstances were exceptional, which they were not. The court did, however, hold that the American claimants who had supplied goods and services to sister ships of the "Brussel" were not entitled to maritime liens and, therefore, were not entitled to a priority.

The court ordered that the balance of the sale proceeds after payment of all of the above creditors would go to the mortgagee who had a claim in excess of $68 million.

One of the other claimants, Halterm, had paid the wharfage for the "Brussel" to the Halifax Port Corporation and claimed to be subrogated to the statutory lien of the Port Corporation. The court found, however, that there was no evidence of an explicit assignment of the Port Corporation’s lien rights and further noted that the Canada Ports Corporation Act was silent regarding whether such rights could be assigned. The court ultimately held that there had been no assignment in favour of Halterm. In reaching this decision the court was careful to note that it did not "foreclose the possibility that a maritime right in rem or other lien may be assignable". (Note: in The "Atlantis Two" the court approved of an assignment of the seamens’ liens for repatriation costs to the Crown.)

Another claimant, Bridge Oil, alleged that it was entitled to a maritime lien for bunkers supplied to the "Brussel" in Belgium based on Article 2(5) of the Unification of Certain Rules Relating to Maritime Liens and Mortgages, 1926, which gives a maritime lien for contracts entered into by a Master provided, inter alia, the vessel is away from her home port and the contracts were necessary for the preservation of the ship or the continuation of the voyage. The court disallowed the lien claim on the grounds that the bunkers were ordered by the owner and not the Master.

A lessor of containers alleged that it had a maritime lien for unpaid lease payments on containers supplied to the "Brussel". The lease agreement expressly provided that the lessor was to have a contractual lien against the lessee’s vessels. The court held that such a lien has no special priority as against third parties. (Note: In The "Atlantis Two" the Prothonotary seemed to suggest that a contractual lien might be of some effect in a priorities hearing.)

Neves v The "Kristina Logos", 
(August 11, 1999) No. T-1041-95 (F.C.T.D.).

This was a hearing to determine priorities to the sale proceeds of the Defendant vessel. The vessel had been seized by the Crown for violations of the Fisheries Act and was later arrested and sold at the application of the Crown. The claimants were the Crown, the mortgagee, and the co-owners of the vessel. The Crown claimed a priority for the costs of sale, the costs of maintaining the ship, and for $50,000.00 ordered forfeited to the Crown by the Newfoundland Supreme Court following the conviction of one of the co-owners of an offence under the Fisheries Act. In addition, the Crown claimed $120,000.00, being the fine imposed on the co-owner by the Supreme Court of Newfoundland. No priority was claimed in respect of the $120,000.00. The Prothonotary granted the Crown priority ahead of the mortgagee for the costs of sale and for the $50,000.00 ordered forfeited by the Newfoundland court. (Note: The Newfoundland Court of Appeal set aside the order of forfeiture in a decision reported at R v Ulybel Enterprises Ltd., [1999] N.J. No. 232.) The court refused to grant priority for the costs of maintaining the vessel. The court held that the Crown had incurred these costs not because of the arrest of the ship in the Federal Court but rather in furtherance of a seizure and attempted forfeiture under section 71 of the Fisheries Act. Accordingly, the court held, it was the provisions of the Fisheries Act that should govern and section 71(1) of that Act provided that any claim for reimbursement for such costs had to be made to the Newfoundland courts. Further, the court held that the Crown could and should have brought an application at the time of arrest or shortly thereafter for an order that the costs of preserving the vessel be treated as Marshall’s expenses. The court also considered whether there were any special circumstances that might justify the priority sought by the Crown but found that there were none.

With respect to the $120,000.00 fine, there was an issue as to whether the amount could be claimed at all from the proceeds of sale. The court held that it could be on the grounds that the order imposing the fine could be executed against any of the co-owner’s property, including the ship or its proceeds. The court therefore held that the $120,000.00 should be paid from any amounts which would be due to the co-owner on distribution of the fund after payment to creditors. (Note: It is not apparent how the claim for the $120,000.00 was a claim in rem.)

This decision is further of interest in that the court ordered that the amount owing to the mortgagee should rank after the claim of one of the co-owners of the vessel to the surplus. This unusual ranking was explained on the basis that it would not prejudice the mortgagee, presumably because there were sufficient funds to pay out the mortgagee even if ranked in this position.

Canadian Imperial Bank of Commerce v The "Barkley Sound", 
(March 4, 1999) Vancouver Reg. No.A983054 (B.C.S.C.).

This was an application to determine priorities. At issue was whether a ship repairer in possession could claim priority over the mortgagee for storage charges and interest. The court found that the repairer had retained possession of the vessel and that the storage charges were incurred for the purpose of protecting the repairer's interest. Under these circumstances, the court held that such charges cannot be added to the maritime lien. On the matter of interest the court held that the repairer was entitled to interest at 5% per annum in priority to the bank. A secondary issue in the case was whether a supplier of goods to the vessel could obtain a priority over the bank on the basis of unjust enrichment. The court held that the supplier was a simple unsecured creditor and that he had not established any of the requirements of unjust enrichment.

The Bank of Scotland plc. v The "Nel", 
(1999) 161 F.T.R. 303, (F.C.T.D.).

This was an application by a shipping agent and ad hoc supplier of bunkers to recover from the sale price of the Defendant vessel the value of bunkers sold with the ship and supplied by the applicant. The supplier did not render an invoice to the ship owner when the bunkers were delivered. The supplier said it intended to recover the price of the bunkers from the freight when paid and led evidence that it did not intend to sell the bunkers to the owner until the freight was paid. The court was satisfied that the intention of the supplier was to not transfer title in the bunkers  to the ship owner until it was paid in full. The court therefore held that property in the bunkers had not passed and the supplier was entitled to the proceeds from the sale of the bunkers.

Royal Bank of Scotland plc v The "Kimisis III", 
(February 9, 1999) No. T-38-99 (F.C.T.D.).

This was a motion by a mortgagee for an order that the owner of a cargo of wheat on board the "Kimisis III" remove the cargo at its expense. The motion was denied on the grounds that it was premature as the mortgagee had not entered into possession of the vessel and had not applied for a court ordered sale. However, during the course of his reasons, Prothonotary Hargrave noted that there was a difference between the English approach to the removal of cargo from a ship under arrest and the American approach. The English approach is that the costs of discharging the cargo should fall upon the cargo owner whereas the American approach is that the costs of discharging cargo are in the nature of custodia legis and are therefore recoverable from the fund in priority to other claims. (Note: It would appear to be an open question which of these two approaches a Canadian court will follow.)

Nedship Bank N.V. v The "Zoodotis", 
(March 24, 1999) No. T-186-99 (F.C.T.D.).

This was an application by the second highest bidder for the Defendant vessel to set aside an ex parte order that extended by two days the deadline by which the successful bidder was to pay the purchase price. The ex parte order was granted because there had been a transfer error by bankers. The court refused the application holding that forfeiture is a drastic event and should not be ordered "to penalize a bona fide buyer who has run afoul of a bank clerk who cannot cope with a bank transfer".

Annacis Auto Terminals (1997) Ltd. v The "Cali", 
(1999) 163 F.T.R. 139, (F.C.T.D.).

This was a motion by the mortgagee to vary an order of sale. The motion arose because one of the terms of the sale order was that any moorage charges from the date of the sale order to the time the ship left the berth were to be given priority as sheriff's costs. At the time it was contemplated that the ship would leave the berth within 45 days of the sale. However, the ship remained at the berth 75 days after the sale and it was not apparent that she would be leaving any time soon. This resulted in ever increasing moorage charges which, as each day passed, meant a smaller recovery for the mortgagee. Although the court clearly had sympathy for the mortgagee, it held that the words "liberty to apply" in the sale order did not confer a right to vary the order. The court held that the order was final and binding. The court did, however, suggest that if a motion was brought pursuant to Rule 399(2) that the mortgagee might obtain some relief by way of an assignment of the claim of the dock owner against the purchaser of the ship.

The Royal Bank of Scotland v The "Kimisis III", 
(June 8, 1999) No. T-38-99 (F.C.T.D.).

In this matter the court allowed the late filing of several affidavits of claim as the order setting the time for filing was ambiguous and did not accord with what had been agreed to at the hearing. The court specifically cautioned against the use of the words "prior to" in orders and suggested instead that the words "on or before" should be used to avoid any misunderstanding.

The Royal Bank of Scotland v. The "Golden Trinity" et al., 
(1999) 170 F.T.R. 314, (F.C.T.D.).

These reasons dealt with a reconsideration of a previous Order made from the bench allowing an advance payment to the mortgagees of the Defendant vessel from the sale proceeds of the Defendant vessel. The court confirmed the previous Order on the grounds that the advertising and search of lien claimants had been completed, the funds remaining in court were sufficient to satisfy all claimants with a reserve for costs and interest, and the mortgagees had undertaken to return the advances should that be necessary.

Holt Cargo Systems Inc. v The "Brussel", 
(1999) 173 D.L.R. (4^th) 493, (F.C.A).

In this matter the Appellant, the Trustee in Bankruptcy, argued that the motions judge erred in refusing to stay the proceedings before the Federal Court in order to allow the Belgian Commercial Court to dispose of the Respondent's claim in the Belgium bankruptcy proceedings. The Federal Court of Appeal dismissed the appeal. The court held that a legitimate legal advantage would accrue to the Respondent if its claim was adjudicated in the Federal Court since it was unlikely the Belgium courts would recognise the Respondent's in rem claim. Further, the court held that there was a "real and substantial connection" with Canada as that was where the ship was arrested. The court was also critical of the Appellant's use of the Quebec Superior Court to obtain an order enjoining the Federal Court from releasing the arrested ship. The court said the Appellants should have sought the assistance of the Federal Court. (Note: This decision is under appeal to the Supreme Court of Canada.)

IX. Miscellaneous

Sail Labrador Ltd. v The "Challenge One", 
[1999] 1 S.C.R. 265, (S.C.C.).

This was an appeal from the Federal Court of Appeal. The Appellant/Plaintiff had entered into a 5 year charter party with the Respondent/Defendant. The terms of the charter party included an option to purchase the vessel at the end of the five year term subject to "full performance" of its obligations under the charter party. Clause 10 of the charter party specified an annual payment and clause 11 provided that the annual payment was to be paid in seven monthly instalments. The practice of the parties was for the Plaintiff to provide the Defendant with seven post dated cheques at the beginning of each year. Due to an error by the Plaintiff's bank, the first cheque for the fifth year was returned insufficient funds. The Defendant then wrote to the Plaintiff advising that the option to purchase was void. The Plaintiff immediately rectified the non-payment and all subsequent payments were made on time. Pursuant to clause 25 of the charter party, the Defendant also requested that the Plaintiff provide it with all of the log books for the vessel. The Plaintiff failed to do so. At the conclusion of the charter term, the Plaintiff attempted to exercise the option to purchase but the Defendant took the position that the option was void because of the late payment and the failure to provide the log books.

At trial, the trial judge held that the Plaintiff had substantially performed its obligations under the charter party and was entitled to exercise the option to purchase. On appeal, the Federal Court of Appeal held that a party exercising an option to purchase must strictly comply with the conditions of the option and that, as the Plaintiff had not done so, it was not entitled to exercise the option. On further appeal, the Supreme Court of Canada held that the option to purchase was part of a bilateral agreement between the parties comprising both the charter and the option. As a bilateral contract the doctrine of substantial compliance was applicable and the court found that there had been substantial compliance by the Plaintiff. Further, the court held that the words used in the option were not precise enough to make time of the essence of the contract. On the issue of the Plaintiff's failure to provide the log books the court noted that pursuant to section 26 of the Canada Shipping Act the log books must remain on the vessel. Therefore, the court held that all the Plaintiff was required to do was to make the logs available for inspection on the vessel. In result, the appeal was allowed.

Kajat v The "Arctic Taglu", 
(February 15, 2000) No. A-45-98 (F.C.A.).

This was an appeal from a judgement of the Trial Division in which the Defendants were found 85% at fault for a collision between the fishing vessel "Bona Vista" and a tug-barge combination operated by one of the Defendants. A critical determination made by the Trial Judge was that the accident occurred because of the use of a search light on the tug to warn mariners of the existence of the barge by panning the light up and down the port side of the barge . She found that this was perceived by those on board the "Bona Vista" as a signal of an unseen danger to the port side of the barge causing the "Bona Vista" to turn to port, a manoeuver which resulted in the collision. Her conclusions were based on the evidence of two mariners who each testified that they had encountered the tug-barge combination and that they had interpreted the panning search light as a signal of danger to the port side of the barge and turned to port to avoid the unseen danger. The Defendants argued that the Trial judge erred in allowing the evidence of these two mariners. The Federal Court of Appeal agreed. The court held that the Trial Judge had an obligation to determine whether the similar fact evidence was logically probative, i.e. whether it is logically relevant to determining the matter in issue. The court was unable to conclude from the record whether the Trial Judge had made a specific determination to that effect and, therefore, allowed the appeal and ordered a new trial. (It is noteworthy that the Court of Appeal did not determine that the evidence of the two mariners should not have been admitted by the Trial Judge. The court merely determined that the Trial Judge had not specifically addressed her mind to the appropriate test to be applied before admitting similar fact evidence.)

Laursen v Bemister, 
(1999), 47 C.C.L.T. (2d) 206, (B.C.S.C.).

This was an action in negligence, breach of contract and bailment against the Defendant in respect of damage to the Plaintiffs' vessels that were stored in the Defendant's barn when the roof collapsed under a snow load. The action was dismissed. The court held that the Defendant was aware of the potential risk from snow accumulation but took reasonable steps, including daily inspections, to care for the Plaintiffs' property. Thus, the Defendant was not negligent and had complied with the implied term of the contracts that he would use reasonable care in storing the Plaintiffs' property. On the issue of bailment, the court held that the relationship between the Plaintiffs and Defendant was one of licence and not bailment. In reaching this conclusion the court found that the Plaintiffs had not provided the Defendant with access to their chattels nor the means of moving same and that the barn was open to all. Therefore, the court held, the Defendant did not have exclusive possession of the Plaintiffs' chattels, a necessary element of bailment.

Glovertown Shipyards Ltd. v Hickey, 
[1999] N.J. No. 169, (Nfld. S.C.).

This was an action by the Plaintiff shipyard to recover the balance owing on a ship construction contract with the Defendant purchaser. The purchaser alleged that the vessel was constructed with numerous defects that amounted to a fundamental breach of contract by the shipyard and rendered the ship not fit for the purpose for which it was intended and not of merchantable quality. The purchaser further counterclaimed against the shipyard and against the ship's designer and steamship inspectors alleging their negligence resulted in the loss of the vessel at sea. In a judgment of 216 pages the court held that the ship when delivered was seaworthy, fit for the purpose intended and was of merchantable quality. The court noted that, although a number of problems were experienced by the vessel after delivery, these problems were repairable and were all dealt with by the shipyard and/or by suppliers of equipment. Accordingly, the court found that there had been no fundamental breach of the contract by the shipyard and allowed the shipyard's claim for the balance of the purchase price. With respect to the counterclaim, the court found some negligence on the part of the shipyard and the designers of the vessel but held that this negligence was not causative of the loss of the vessel. The cause of the loss was determined to be due primarily to the negligence of the purchaser in selecting an unqualified Master and to the negligence of the Master in the management and navigation of the vessel. Additionally, the court found that the steamship inspectors were negligent in their failure to reasonably interpret and apply the regulations and provisions of the Tonnage Guidelines under the Canada Shipping Act. The court apportioned liability and costs 65% against the purchaser and Master and 35% against the steamship inspectors. 

Nickerson v Canada, 
(May 5, 1999) No.T-2807-93 (F.C.T.D.).

This was an action against two steamship inspectors for providing the Plaintiff with negligent advice. The facts were that the inspectors wrote a letter to the Plaintiff recommending, inter alia, that he coat the wood core of his vessel with a suitable wood preservative before applying fibre glass. The Plaintiff alleged that in reliance on this advice he purchased and applied creosote to his vessel. The Plaintiff was later advised that fibre glass would not bond to wood coated with creosote. Accordingly, the Plaintiff brought this action for damages in the amount of $500,000. Unfortunately for the Plaintiff, the court completely disbelieved him. The court found as a fact that the plaintiff did not creosote his vessel as he alleged. Further, the court held that even if the Plaintiff did creosote the vessel the inspectors were not liable. The inspectors merely advised the Plaintiff to apply a suitable wood preservative. The court held that the Plaintiff had the duty to make necessary inquiries to determine what a suitable preservative would have been. Finally, the court held that, in any event, the Plaintiff's vessel had deteriorated to such an extent that it was beyond repair and any advice given by the inspectors would have been to no avail.

Grosvenor v Streifel, 
(May 13, 1999) Vancouver Registry No. C986282 (B.C.S.C.).

This was an action for the unpaid balance of the purchase price of a used vessel. The Statement of Defence and Counterclaim alleged that the vendor had made false representations. Specifically, the purchaser alleged he was induced to enter into the transaction by a marine survey that was given to him by the vendor and by statements made by the vendor that the engines were in perfect condition. The court found, however, that the marine survey had been prepared more than one year prior to the transaction for insurance purposes and that it was provided to the purchaser to assist him with his financing. The court further found that the purchaser had used the vessel for two seasons and had done some work to the engines without ever complaining to the vendor or making a claim. This, the court found, was not consistent with the alleged representation. Accordingly, the action for the unpaid balance of the purchase price was allowed.

LeCleir Bros. Contracting Ltd. v Canoe Cove Marina Ltd., 
(March 5, 1999) Victoria Registry No.981904 (B.C.S.C.).

This case concerned the interpretation of a marina moorage contract. The Plaintiff had moored his boat and boathouse at the Defendant marina for many years. The moorage agreement gave the Defendant the right the cancel the agreement and demand the immediate removal of the Plaintiff's personal effects. It also provided for a right of renewal upon 30 days. The Defendant damaged the Plaintiff's boathouse. As a consequence, the relationship deteriorated and the Defendant sent a letter purporting to terminate the agreement at the end of its annual term. In response, the Plaintiff purported to exercise the right of renewal. The Defendant argued that the renewal was ineffective as the agreement had been terminated. The court held that the letter terminating the agreement was ineffective as the Defendant had elected to allow the agreement to continue until the end of its terms. The court further held, however, that the renewal clause in the agreement was too vague and uncertain to be enforceable as it did not stipulate the rent payable. The court further held that the agreement was subject to the implied terms that it would not be terminated without good reason and that, in the event of termination, reasonable notice would be given.

TABLE OF CASES

Annacis Auto Terminals (1997) Ltd. v The "Cali", (1999) 163 F.T.R. 139, (F.C.T.D.). 

Anraj Fish Products Industries Ltd. v Hyundai Merchant Marine Co. Ltd., (December 10, 1999) No.T-1571-99 (F.C.T.D.). 

B.C. Hydro & Power Authority v The "CSL Cabo" et al., (December 31, 1999) No. T-1194-98 (F.C.T.D.). 

Barzelex v The "EBN Al Waleed", (December 30, 1999) No. T-38-96 (F.C.T.D.). 

Barzelex v The "EBN Al Waleed" (November 29, 1999) No. T-T-38-96 (F.C.T.D.)

Bayside Towing Ltd. v Canadian Pacific Railway Company, (February 2, 2000) No. T-1692-99 (F.C.T.D.). 

Bow Valley Husky (Bermuda) Ltd. v  Saint John Shipbuilding Ltd., (1999) 181 Nfld. & P.E.I.R. 94, (Nfld. S.C.). 

Canadian Imperial Bank of Commerce v The "Barkley Sound", (March 4, 1999) Vancouver Reg. No.A983054 (B.C.S.C.). 

Canadian Pacific Forest Products Limited et al. v The"Beltimber" et al., (1999), 175 D.L.R. (4^th) 449, (F.C.A.). 

Canadian Pacific Railway Company v The "Sheena M" et al., (March 7, 2000) No. T-1887-99 (F.C.T.D.). 

Capilano Fishing Ltd. v The "Qualicum Producer", (January 17, 2000) Vancouver Registry No. C072709 (B.C.S.C.). 

Caterpillar Overseas S.A. v The "Canmar Victory" et al., (November 25, 1999) No. A-488-98 (F.C.A.). 

Cerco Industries Ltd. v The "OOCL Canada", (November 16, 1999) Vancouver Registry No.C990101 (B.C.S.C.). 

Cold Ocean Inc. v The "Gornostaevka" et al., (1999), 168 F.T.R. 269, (F.C.T.D.). 

Commercial Union Assurance Company PLC. v M.T. Fishing Co. Ltd.,(1999) 162 F.T.R. 74, (F.C.T.D.), affirmed (1999) 244 N.R. 372, (F.C.A.). 

Corner Brook Pulp & Paper Ltd. v Comm. Energy & Paper Workers Union, (July 23, 1999) No.T-1326-99 (F.C.T.D.). 

Fraser River Pile & Dredge Ltd. v Can-Dive Services Ltd., [1999] 3 S.C.R. 108 (S.C.C.).