Defective Grapes and Jurisdiction: BC or Ontario?

In Andrew Peller Ltd. v. Mori Essex Nurseries Inc., 2017 BCSC 203, a BC Wine company sued an Ontario grape company alleging that they had been sold defective grape vines. As the issue was proceeding to trial, the Ontario based companies applied to court in British Columbia to transfer the proceedings to Ontario as the more appropriate court on the basis of forum non conveniens. In other words, they asserted that Ontario was the more appropriate place to have the action heard.

The British Columbia legislature has codified the test for when a BC court can assume jurisdiction over a matter; section 11 of the Court Jurisdiction and Proceedings Transfer Act. The test requires the court to take into account a non-exhaustive list of circumstances in whether to exercise jurisdiction:

 

11 (1) After considering the interests of the parties to a proceeding and the ends of justice, a court may decline to exercise its territorial competence in the proceeding on the ground that a court of another state is a more appropriate forum in which to hear the proceeding.

(2) A court, in deciding the question of whether it or a court outside British Columbia is the more appropriate forum in which to hear a proceeding, must consider the circumstances relevant to the proceeding, including

(a) the comparative convenience and expense for the parties to the proceeding and for their witnesses, in litigating in the court or in any alternative forum,

(b) the law to be applied to issues in the proceeding,

(c) the desirability of avoiding multiplicity of legal proceedings,

(d) the desirability of avoiding conflicting decisions in different courts,

(e) the enforcement of an eventual judgment, and

(f) the fair and efficient working of the Canadian legal system as a whole.

However, in some cases a party can take steps in litigation and are deemed to have “attorned” or accepted the Court’s jurisdiction. The issue in this application was whether the defendants could still argue that Ontario was the more appropriate place to have the action heard after attorning to the BC Court’s jurisdiction.

More complicated still is the wording of the Supreme Court Civil Rule 21-8 which states:

(1) A party who has been served with an originating pleading or petition in a proceeding, whether that service was effected in or outside British Columbia, may, after filing a jurisdictional response in Form 108,

(a)  apply to strike out the notice of civil claim, counterclaim, third party notice or petition or to dismiss or stay the proceeding on the ground that the notice of civil claim, counterclaim, third party notice or petition does not allege facts that, if true, would establish that the court has jurisdiction over that party in respect of the claim made against that party in the proceeding,

(b) apply to dismiss or stay the proceeding on the ground that the court does not have jurisdiction over that party in respect of the claim made against that party in the proceeding, or

(c) allege in a pleading or in a response to petition that the court does not have jurisdiction over that party in respect of the claim made against that party in the proceeding.

(2)  Whether or not a party referred to in subrule (1) applies or makes an allegation under that subrule, the party may apply to court for a stay of the proceeding on the ground that the court ought to decline to exercise jurisdiction over that party in respect of the claim made against that party in the proceeding.

The Ontario grape growers argued that Supreme Court Civil rule 21-8(2) allows a party to request that the Court stay proceedings on the basis of forum non conveniens, even if they had attorned. To complicate matters more are the conflicting case authorities on this point.

In Liu v. Huang, 2008 BCSC 288, despite the defendant attorning to the BC court’s jurisdiction, the court still went on to consider the factors under s.11 of the CJPTA and in the end declined to exercise jurisdiction. In Saskatchewan, a similar conclusion was reached in Ackerman v. Saskatchewan Association of Health Organizations, 2007 SKQB 146.

While Mr. Justice Holmes acknowledged the conflicting lines of case authority, in the end he was bound by the reasoning of the court of appeal in Blazek v. Blazek, 2010 BCCA 188 which affirmed the view that the CJPTA and the Rules of Court as they stand bar any forum non convenience challenges after one has attorned.

Mr. Justice Holmes still went on to consider the factors as to whether the court should decline to take jurisdiction and found that the Ontario grape companies had not established that Ontario is the more appropriate forum.

Until the BC Court of Appeal reconsiders this position, the law in BC is clear; once you attorn, you can’t argue forum non conveniens.

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