Commentaries are intended as an introduction or overview of the topic. The commentaries for some topics are more detailed than others but none of them should be taken as a complete and full recitation of the law applicable to the topic.
The cases under this title consider the Admiralty jurisdiction of the courts and which court has jurisdiction to hear a particular matter. More specifically, because the provincial superior courts have inherent jurisdiction, the cases usually concern the whether the Federal Court's admiralty jurisdiction is invoked. It is important to note that the Admiralty jurisdiction of the Federal Court is closely related to the definition, nature and scope of the body of law known as Canadian Maritime Law which is, in turn, partly dependant upon the constitutional division of powers between the federal and provincial governments. Therefore, the cases digested under the topic Constitutional Issues may also be relevant and should be consulted when addressing a jurisdiction issue.
The Admiralty Jurisdiction of Provincial Courts
The provincial superior court's have inherent jurisdiction which means that they have jurisdiction to hear all cases unless a statute specifically provides otherwise (see below for some examples of statutes that specifically provide otherwise). It is clear that they have admiralty jurisdiction, something which the Supreme Court of Canada confirmed in Ontario v Pembina Exploration
.,  1 SCR 206, at para. 15. Ontario v Pembina
also stands for the proposition that a provincial inferior court, such as a small claims court, also has jurisdiction to hear admiralty cases. However, with the exception of British Columbia, the provincial courts do not have in rem
actions or admiralty rules. Thus, as a practical matter, it is often prudent to commence admiralty cases in the Federal Court.
The Federal Court's Concurrent Admiralty Jurisdiction
The Federal Court is a statutory court and, as such, has only the jurisdiction specifically given to it. Section 22 of the Federal Courts Act is the primary source of the Federal Court's admiralty jurisdiction. Subsection 22(1) is a general grant of concurrent jurisdiction to hear and determine any case "in which a claim for relief is made or a remedy is sought under or by virtue of Canadian maritime law".
22. (1) The Federal Court has concurrent original jurisdiction, between subject and subject as well as otherwise, in all cases in which a claim for relief is made or a remedy is sought under or by virtue of Canadian maritime law or any other law of Canada relating to any matter coming within the class of subject of navigation and shipping, except to the extent that jurisdiction has been otherwise specially assigned.
Subsection 22(2) of the Federal Courts Act
also enumerates 19 specific categories of claims over which the Federal Court has jurisdiction. The categories are:
(a) any claim with respect to title, possession or ownership of a ship or any part interest therein or with respect to the proceeds of sale of a ship or any part interest therein;
(b) any question arising between co-owners of a ship with respect to possession, employment or earnings of a ship;
(c) any claim in respect of a mortgage or hypothecation of, or charge on, a ship or any part interest therein or any charge in the nature of bottomry or respondentia for which a ship or part interest therein or cargo was made security;
(d) any claim for damage or for loss of life or personal injury caused by a ship either in collision or otherwise;
(e) any claim for damage sustained by, or for loss of, a ship including, without restricting the generality of the foregoing, damage to or loss of the cargo or equipment of, or any property in or on or being loaded on or off, a ship;
(f) any claim arising out of an agreement relating to the carriage of goods on a ship under a through bill of lading, or in respect of which a through bill of lading is intended to be issued, for loss or damage to goods occurring at any time or place during transit;
(g) any claim for loss of life or personal injury occurring in connection with the operation of a ship including, without restricting the generality of the foregoing, any claim for loss of life or personal injury sustained in consequence of any defect in a ship or in her apparel or equipment, or of the wrongful act, neglect or default of the owners, charterers or persons in possession or control of a ship or of the master or crew thereof or of any other person for whose wrongful acts, neglects or defaults the owners, charterers or persons in possession or control of the ship are responsible, being an act, neglect or default in the management of the ship, in the loading, carriage or discharge of goods on, in or from the ship or in the embarkation, carriage or disembarkation of persons on, in or from the ship;
(h) any claim for loss of or damage to goods carried in or on a ship including, without restricting the generality of the foregoing, loss of or damage to passengers’ baggage or personal effects;
(i) any claim arising out of any agreement relating to the carriage of goods in or on a ship or to the use or hire of a ship whether by charter party or otherwise;
(j) any claim for salvage including, without restricting the generality of the foregoing, claims for salvage of life, cargo, equipment or other property of, from or by an aircraft to the same extent and in the same manner as if the aircraft were a ship;
(k) any claim for towage in respect of a ship or of an aircraft while the aircraft is water-borne;
(l) any claim for pilotage in respect of a ship or of an aircraft while the aircraft is water-borne;
(m) any claim in respect of goods, materials or services wherever supplied to a ship for the operation or maintenance of the ship, including, without restricting the generality of the foregoing, claims in respect of stevedoring and lighterage;
(n) any claim arising out of a contract relating to the construction, repair or equipping of a ship;
(o) any claim by a master, officer or member of the crew of a ship for wages, money, property or other remuneration or benefits arising out of his or her employment;
(p) any claim by a master, charterer or agent of a ship or shipowner in respect of disbursements, or by a shipper in respect of advances, made on account of a ship;
(q) any claim in respect of general average contribution;
(r) any claim arising out of or in connection with a contract of marine insurance; and
(s) any claim for dock charges, harbour dues or canal tolls including, without restricting the generality of the foregoing, charges for the use of facilities supplied in connection therewith.
Because the Federal Court has jurisdiction to hear and determine any case "in which a claim for relief is made or a remedy is sought under or by virtue of Canadian maritime law", it is often necessary to determine the scope and content of "Canadian maritime law" in order to assess the full extent of the Federal Court's admiralty jurisdiction. Canadian maritime law is a separate and distinct body of law defined in section 2 of the Federal Courts Act and enacted by s. 42 of the Federal Courts Act.
“Canadian maritime law” means the law that was administered by the Exchequer Court of Canada on its Admiralty side by virtue of the Admiralty Act, chapter A-1 of the Revised Statutes of Canada, 1970, or any other statute, or that would have been so administered if that Court had had, on its Admiralty side, unlimited jurisdiction in relation to maritime and admiralty matters, as that law has been altered by this Act or any other Act of Parliament;
42. Canadian maritime law as it was immediately before June 1, 1971 continues subject to such changes therein as may be made by this Act or any other Act of Parliament.
Since at least ITO Terminal Operators Ltd. v Miida Electronics Inc.,  1 SCR 752, the test for a finding of jurisdiction in the Federal Court has required that three essential elements be established:
(1) that there is a statutory grant of jurisdiction to the Federal Court;
(2) that there is an existing body of federal law, essential to the disposition of the case, which nourishes the statutory grant of jurisdiction; and
(3) that the law on which the case is based must be "a law of Canada" as the phrase is used in s. 101 of the Constitution Act.
The first element of the above test, that there be a statutory grant of jurisdiction to the Federal Court, is necessary but not sufficient, by itself, to give the Federal Court jurisdiction. This part of the test is usually satisfied, in relation to maritime matters, by referring to s. 22 of the Federal Courts Act.
The second element of the above test is that there be existing federal law to nourish the statutory grant of jurisdiction. In maritime matters the federal law nourishing the statutory grant is usually Canadian maritime law as enacted by s. 42 of the Federal Courts Act. There is a very large body of case law that explores the nature, scope and content of Canadian maritime law in relation to Federal Court jurisdiction. The more recent cases are digested on this site and, as well, there are papers listed below that address this issue in detail. In general, Canadian maritime law is the law that governs matters relating to navigation and shipping. It is federal law that is uniform throughout the country and is applied regardless of the court in which proceedings are commenced. It includes, but is not limited by, the rules and principles of English admiralty law as it was exercised in 1934. More specifically, it includes the laws relating to: carriage of goods by sea (Tropwood A.G. v Sivaco Wire & Nail Co); contracts relating to the sale of a ship (Antares Shipping Corp. v The “Capricorn); contracts for the repair of a ship or her equipment (Wire Rope Industries v B.C. Marine Shipbuilders Ltd); marine insurance (Triglav v Terrasses Jewellers Ltd); and stevedores (I.T.O. v Miida Electronics Ltd.). Canadian maritime law includes the common law principles of contract, tort, bailment and agency (Q.N.S. Paper Co. v Chartwell Shipping Ltd.) and tort liability (Whitbread v. Walley).
Finally, the third element in the above test, that the law must be a "law of Canada" within the meaning of s. 101 of the Constitution Act, requires that the nourishing law must be within federal legislative competence under s. 91(10) of the Constitution Act. This element of the test requires a constitutional analysis involving the division of powers under the Constitution Act between the federal and provincial governments. Again, the more recent cases considering these issues are summarized on this site but some are digested under the topic Constitutional Issues.
The three part test in ITO Terminal Operators Ltd. v Miida Electronics Inc. is somewhat easier to apply when one is addressing a matter that falls within one of the enumerated categories in ss. 22(2) of the Federal Courts Act. It has been held that claims within ss. 22(2) are necessarily nourished by Canadian maritime law and within the jurisdiction of the Federal Court. (Harry Sargeant III v. Al-Saleh, 2014 FCA 302, paras. 89-93; Siemens Canada Ltd. v. J. D. Irving Ltd., 2012 FCA 225 (CanLII), para. 35; Skaarup Shipping Corporation v. Hawker Industries Limited  2 F.C. 746)
The Federal Court's Exclusive Admiralty Jurisdiction
It is to be noted that the Federal Court's admiralty jurisdiction under section 22 is not exclusive but is concurrent. This means that, unless a specific statute provides otherwise, the provincial superior courts also have jurisdiction to hear and determine admiralty cases. Two statutes that provide otherwise are the Marine Liability Act and the Canada Shipping Act 2001. These statutes give the Federal Court exclusive jurisdiction in relation to the following matters, among others:
|Marine Liability Act
||The constitution and distribution of a limitation fund established under the LLMC Convention.
|Marine Liability Act
||The constitution and distribution of a limitation fund established under the CLC Convention.
|Marine Liability Act
||The constitution and distribution of a limitation fund established under the HNS Convention 2010, once it enters into force.
|Marine Liability Act
||Appeals from decisions by the Administrator of the Ship Source Oil Pollution Fund.
|Canada Shipping Act, 2001
||Claims for lien in respect of seamen's wages. (Note that such claims can be made in any court with an in rem procedure but only the Federal Court and the British Columbia Supreme Court have such procedures.)
For further background and a historical review of the important cases in this area please see the below papers but take note that the papers are not current and this area continues to develop.
Statutes and Regs
The database contains 48 case summaries relating to Admiralty Jurisdiction. The summaries are sorted in reverse date order with 20 summaries per page. If there are more than 20 summaries, use the navigation links at the bottom of the page.
Please note that to facilitate easier browsing and indentification of a relevant case on small devices, we have truncated the summaries which requires you to click "more" to view a full summary. If you wish to view these summaries without truncation, click here
Insolvency Proceedings - Judicial Sale of Ship -Competing Jurisdiction of Federal Court and Provincial Superior Court
Roynat Inc v. Phoenix Sun Shipping Inc, 2013 ONSC 7308
Précis: The Ontario Superior Court referred applications concerning the sale of a ship to the Federal Court on the grounds that deference had to be paid to the Federal Court Proceedings.
The ship “Phoenix Sun” was arrested in Federal Court proceedings by two creditors. The mortgagee subsequently commenced proceedings in the Ontario Superior Court and obtained an order for the appointment of a receiver over the assets of the ship owner. The mortgagee also obtained a very detailed sales order from the Federal Court that, among other things, appointed the receiver as “Acting Admiralty Marshall” to sell the ship and set up a priorities claims process. The receiver found a buyer for the ship and now brought applications in the Ontario Superior Court for an order approving the sale and for directions regarding the disposition of the sale proceeds.
Decision: The applications should not be brought in the Ontario Superior Court but in the Federal Court.
Held: Although the provincial superior courts and the Federal Court have overlapping jurisdiction in maritime law matters, a creditor must take great care that it sets up a process by which one court will have primary carriage of the realization proceedings. Once in rem proceedings are commenced in the Federal Court the provincial superior court should pay due regard or deference to the Federal Court proceedings. Considering the extensive order made by the Federal Court, it is not appropriate for the Ontario Superior Court to exercise any of its jurisdiction and the motion should be brought before the Federal Court. Any residual matters the Federal Court cannot deal with can then be brought in the Ontario Superior Court.
Federal Court Jurisdiction- Crown Immunity - Federal Court Has No Jurisdiction Over Province
Alberta (Canada) v. Toney, 2012 FC 1412 2013 FCA 217
Précis: The Federal Court of Appeal held that the Federal Court had no in personam jurisdiction over the Province of Alberta.
This was an in rem and in personam action against both the federal and provincial crowns and a vessel owned by the Alberta government. The action concerned a fatal accident that occurred on an Alberta lake. The plaintiffs alleged that the defendants were negligent in their performance of search and rescue duties. The Province of Alberta objected to the jurisdiction of the Federal Court over it and initially brought a motion to strike the statement of claim. That application was dismissed (see: Canada v Toney, 2011 FC 1440 and 2012 FCA 167). The parties then agreed that the issue of the in personam jurisdiction of the Federal Court over the Province of Alberta should be determined as a question of law and Alberta brought this application for such a determination. Alberta argued that the doctrine of Crown immunity applied and that it could not be bound by a federal statute. The motions Judge disagreed and held (at 2012 FC 1412) that the Federal Court did have in personam jurisdiction. In reaching this decision the motions Judge noted that the Federal Court had subject matter jurisdiction and further noted that s. 3 of the Marine Liability Act and s. 43(7) of the Federal Courts Act both permitted actions against a province. The Province of Alberta appealed.
Decision: Appeal allowed.
Held: The four basic principles are: first, the Crown (both federal and provincial) is prima facie immune from legislation; second, where Parliament (the federal Crown) has the authority to legislate in an area, a provincial Crown will be bound where Parliament so chooses; third, in order for a provincial Crown to be sued in the Federal Court, there must be some legislative provision permitting it; and fourth, the Federal Court must have jurisdiction over both the subject matter and the parties. The question is whether there is a legislative provision indicating a clear intent by Parliament to bind the province. The possibilities are ss. 22 and 19 of the Federal Courts Act and the Alberta Proceedings Against the Crown Act. Section 22 of the Federal Courts Act (granting jurisdiction “between subject and subject as well as otherwise”) does not contain a clear expression of intention to bind a Province. Section 19 of the Federal Courts Act (intergovernmental disputes) does not apply to claims by a private citizen and is therefore of no assistance. Finally, even though the Alberta Proceedings Against the Crown Act does not expressly reserve jurisdiction to the courts of Alberta, it also does not expressly grant jurisdiction to the Federal Court. In result, the appeal is allowed and the Federal Court has no in personam jurisdiction over the Province of Alberta.
Jurisdiction - Sale of Property not in Canada
SDV Logistiques (Canada) Inc. v. Dieselgenset Type 8M 25, Engine No. 45085 EX the Barge Andrea, 2013 FC 671
Précis: The court held that it had no jurisdiction to sell property that was not located in Canada.
The plaintiff, at the request of a ship builder, arranged for the pick-up and storage of generators at the Port of Hamburg. The generators were intended to be installed in two vessels being built by the builder. The builder originally paid the storage charges but ran into financial difficulties and ceased to make payments leaving the plaintiff with a debt owing of in excess of $200,000. The plaintiff brought these proceedings in personam against the successor of the builder and the mortgagee of the vessels and also brought in rem proceedings against the generators and other cargo. A Warrant of Arrest was issued but was never served with the result that the action proceeded solely as an in personam action. The plaintiff, nevertheless, brought a motion pursuant to Rule 379 for an order that the generators be sold. At first instance, the Prothonotary refused the order. The plaintiff appealed.
Decision: Appeal dismissed.
Held: Rule 379 cannot be applied because the generators are not and have never been in Canada and there is no evidence the generators are likely to deteriorate. Further, for the court to order the sale of property outside of the jurisdiction, there must be some enabling statutory provision and there is none. Consequently, the court has no jurisdiction to issue the order requested.
Federal Court Jurisdiction over Provincial Crown – Practice – Pleadings - Motion to Strike
Ship Source Oil Pollution Fund v. British Columbia (Finance), 2012 FC 725
Précis: The admiralty jurisdiction of the Federal Court was held to include jurisdiction in actions against a provincial crown. (This is probably no longer good law. See the "Comment" in the summary.
This action by the plaintiff was pursuant to the Marine Liability Act to recover costs it paid to clean up oil pollution from a vessel that sank in Brittania Bay, British Columbia. The defendant was the Crown in right of the Province of British Columbia who had allegedly became the “owner” of the vessel when its registered and beneficial owner was dissolved under the Society Act of British Columbia. The BC Crown brought this application to strike the claim on various grounds including that the Federal Court does not have in personam jurisdiction against it or, alternatively, that that Federal Court is without subject matter jurisdiction because the issue of ownership depended on provincial law.
Decision: Application dismissed.
Held: The test on a motion to strike for lack of jurisdiction is whether it is plain and obvious the claim discloses no reasonable cause of action. For the purpose of the application, the allegations of fact in the pleadings are accepted as proved unless patently ridiculous or incapable of proof. The onus is on the party moving to strike the pleading. The BC Crown is asking the Federal Court to engage in a complex exercise of statutory interpretation to justify the “draconian” measure of striking the Statement of Claim. “A motion to strike is not the proper forum to make a final determination on such weighty matters.” Alberta v Toney, 2012 FCA 167, is dispositive of the issue and, in any event, it is not plain and obvious the Federal Court is without jurisdiction. Jurisdiction is based on a three part test: there must be a statutory grant of jurisdiction; there must be an existing body of federal law essential to the disposition of the case that nourishes the statutory grant; and, the law on which the case is based must be “a law of Canada” within the meaning of s.101 of the Constitution Act. Section 22(2)(d) of the Federal Courts Act grants jurisdiction with respect to “damage done by a ship” and the sinking of a ship resulting in pollution is arguably damage within the meaning of s. 22(2)(d). There is case authority that the Federal Court has jurisdiction over a claim against a province as owner of a vessel where the claim is a maritime claim. Section 43(7) of the Federal Courts Act also suggests the Federal Court has in rem jurisdiction against a ship owned by a province. Section 3 of the Marine Liability Act also expressly provides that act is binding on a province. At the very least it is not plain and obvious the Federal Court does not have personal jurisdiction over the BC Crown. The fact that the ownership issue may require the application by the Federal Court of provincial law does not matter. The ancillary application of provincial law does not affect the jurisdiction of the Federal Court.
Comment: It is now clear that the Federal Court does not have jurisdiction over a province as decided in Alberta (Canada) v. Toney, 2013 FCA 217.
Federal Court Jurisdiction - Action vs Provincial Crown - In Rem Proceedings
Canada v. Toney, 2011 FC 1440 2012 FCA 167
This was an in rem and in personam action against both the federal and provincial crowns and a vessel owned by the Alberta government. The action concerned a fatal accident that occurred on an Alberta lake. The plaintiffs alleged that the defendants were negligent in their performance of search and rescue duties. The Alberta defendants moved to strike the in rem action on the basis that the vessel had been sold prior to the commencement of the action and also moved to strike the in personam action against them on the basis that actions against a provincial crown should be commenced in the provincial courts. The federal defendants also moved to stay the action or to have it struck as an abuse of process. At first instance, the trial Judge allowed the motions only with respect to the action in rem. The trial Judge held that the sale of the vessel prior to the commencement of the action did defeat the action in rem but it did not affect the action in personam. The trial Judge (2011 FC 40) held that the fact one of the defendants was a provincial crown was irrelevant as the action (and the Federal Court’s jurisdiction) was not grounded in s. 17 of the Federal Courts Act (which governs actions against the Federal Crown) but in s.6 and following of the Marine Liability Act. The Alberta defendants appealed.
Decision: Appeal dismissed.
Held: The Federal Court of Appeal Court noted that it was undisputed the plaintiffs’ claims fall within the subject of navigation and shipping and within the express terms of section 22 of the Federal Courts Act. It was not plain and obvious that the Federal Court was without jurisdiction.
Comment: In Toney v. Canada, 2012 FC 1412, the same point was brought to the court on a question of law (as opposed to the above case which was a motion to strike). At first instance the Federal Court held that it had jurisdiction in personam against a province in a maritime matter. However, on appeal, at 2013 FCA 217, the Federal Court of Appeal held that the Federal Court has no jurisdiction over a provincial crown.
Brokerage contract – Jurisdiction – Canadian Maritime Law
Alcan Primary Metal v. Groupe Maritime Verreault Inc, 2011 FCA 319
This case concerned whether the Federal Court had the jurisdiction to determine a dispute between the parties involving alleged breaches of a brokerage contract relating to tugs. The parties had entered into a contract whereby the plaintiff was to be paid a commission in the event that it found a tug or tugs that met the needs of the defendant. The plaintiff claimed it was owed commission under the contract and brought this action to recover the commission. The defendant responded by challenging the jurisdiction of the Federal Court. At first instance, the Motions Judge dismissed the motion finding that the contract was maritime in nature and fell within Canadian maritime law. The Federal Court of Appeal affirmed the Motions Judge. The Court did not accept that there was any distinction to be drawn between the purchase of a tug and brokerage services that enable the purchase. The Court held the two were inseparable.
Federal Court Jurisdiction - Dispute Between Shareholders over Funds in Court
JP Morgan Chase Bank v. Mystras Maritime Corporation, 2010 FC 1053
This matter concerned a dispute between two former shareholders and directors of the judgment creditor concerning who was entitled to the proceeds of an in rem action. The Court held that it was without jurisdiction to determine the dispute which was held not to be integrally connected to maritime matters.
Enforcement of Foreign Judgements – Proper Test – Attornment – Application of Provincial Statutes
Morgan v. Guimond Boats Ltd., 2006 FCA 401
In this matter the Plaintiff, a resident of Hawaii, commenced proceedings against the Defendant, a New Brunswick company, in Hawaii in relation to a contract for the design, manufacture and sale of a boat. The Defendant unsuccessfully contested the jurisdiction of the Hawaiian courts, filed a Statement of Defence to the action and participated in a pre-trial conference before withdrawing from the action. The Plaintiff subsequently obtained a default judgment against the Defendant and then brought this action and motion for summary judgement to enforce of the U.S. judgment. The Defendant contested the motion on the ground, inter alia, that the U.S. Court was without jurisdiction. At first instance, the motions Judge held that the appropriate test was whether there was a “real and substantial connection” with the foreign jurisdiction and noted that a fleeting or relatively unimportant connection will not be enough. The motions Judge further held that the connection with Hawaii was such a fleeting or unimportant connection given that the preliminary contract negotiations between the parties, the execution of the work, the delivery of the boat and the payment for the boat all occurred in New Brunswick and the contract was governed by the law of New Brunswick. The Plaintiff's main argument was that the Defendant had attorned to the jurisdiction of the Hawaiian courts. On this issue the motions Judge said that the law of attornment was in a state of flux and suggested that attornment could only bolster an otherwise real and substantial connection. In result, the motion for summary judgment was dismissed. On appeal to the Federal Court of Appeal, however, the Court of Appeal held that attornment to a foreign court was not simply a factor to take into account in determining whether there was a real and substantial connection with the foreign court but was determinative. The Court of Appeal further held that the Defendant had attorned to the Hawaiian courts by filing a defence and participating in settlement conferences. Accordingly, the Court of Appeal allowed the appeal and recognized the foreign judgment. (A noteworthy issue dealt with by the motions Judge but not addressed in the Court of Appeal was whether the Foreign Judgments Act of New Brunswick had any application. The motions Judge held that the statute, being a provincial statute, can have no application to Canadian maritime law, even in the absence of applicable federal legislation.)
Jurisdiction – Personal Injury During Boat Trailering - Limitation of Liability
Isen v. Simms, 2006 SCC 41
The Defendant was injured when a bungee cord that was being used to secure the engine cover of a small pleasure boat slipped from the hands of the Plaintiff shipowner and struck the Defendant in the eye. At the time of the incident the pleasure boat had just been removed from the lake and was on a trailer being prepared for road transportation. The Defendant commenced proceedings against the Plaintiff in the Ontario Supreme Court for damages in excess of $2,000,000. The Plaintiff commenced this action in the Federal Court to limit his liability to $1,000,000 and brought this application under Rule 220(1)(c) of the Federal Court Rules to determine a question of law, namely: whether the facts and circumstances constituted “claims arising on any distinct occasion involving a ship with a tonnage of less than 300 tons” pursuant to section 577(1) of the Canada Shipping Act. The Defendant contested both the jurisdiction of the Federal Court and the substantive relief sought. The Federal Court and the Federal Court of Appeal both held that the claim was a maritime law claim that was subject to the limitation of liability. On appeal to the Supreme Court of Canada, the Supreme Court held that the matter was governed by provincial law, that the Federal Court was without jurisdiction and that the limitation was not applicable. In reaching this conclusion Rothstein J. noted that Parliament did not have jurisdiction over pleasure craft per se and that the Court must look at the allegedly negligent acts “and determine whether that activity is integrally connected to the act of navigating the pleasurecraft on Canadian waterways such that it is practically necessary for Parliament to have jurisdiction over the matter”. Although he agreed with the Federal Court of Appeal that launching of pleasurecraft and their retrieval from the water would be within Parliament's jurisdiction over navigation, he did not agree that the securing of the engine cover with a bungee cord was part of the retrieval process. He stated that the securing of the engine cover had nothing to do with navigation and everything to do with preparing the boat to be transported on provincial highways.
Federal Court Jurisdiction – Enforcement of Foreign Arbitration Awards – Piercing Corp
Trans-Pacific Shipping Co. v. Atlantic & Orient Trust Co. Ltd. et al., 2005 FC 311
In this matter the Plaintiff shipowner had obtained an arbitration award against one of the Defendants in London for breach of a charterparty. The Plaintiff subsequently registered the award in the Federal Court and then brought this action against the charterer and against various related companies and the individual alleged to have effective control of all of the Defendants. The relief claimed by the Plaintiff was a declaration that the debts of the charterer were the debts of all of the Defendants and a declaration that the assets of one of the Defendants were the assets of the charterer. The Defendants brought this application challenging the jurisdiction of the Federal Court arguing that the declarations sought were matters of Property and Civil Rights and therefore within provincial jurisdiction. The Prothonotary, however, held that enforcement of foreign arbitral awards had long been considered within Federal Court jurisdiction. Further, the Federal Court had the implied jurisdiction necessary to enforce its judgments, including the recognition of the foreign arbitral award. The Prothonotary next considered the issue of the piercing of the corporate veil and concluded that it was arguable that the various Defendants were for many purposes one and the same entity and thus should not be entitled to the protection of incorporation as separate entities. The Prothonotary expressly did not decide this issue but merely decided that it was not plain and obvious the Plaintiff could not succeed. (Note: This case should be compared with that of the British Columbia Court of Appeal in Pan Liberty Navigation Co. Ltd. v World Link (HK) Resources Ltd., 2005 BCCA 206, and TMR Energy Limited v. State Property Fund of Ukraine et al., 2005 FCA 28, both of which are summarized below.)
Federal Court Jurisdiction – Scope of Canadian Maritime Law
Kusugak v. Northern Transportation Co. et al., 2004 FC 1696
In this case the Plaintiffs were the dependants of crew members of the “Avatuq” which sank on 25 August 2002 while en route from Churchill, Manitoba to Arviat, Nunavut. All of the crew members perished. The Defendants included the Commissioner of Nunavut, the Government of Nunavut and some of their employees (the “Nunavut Defendants”). The allegations against the Nunavut Defendants were that they failed to have in place or implement proper procedures in relation to the search and rescue operation. The Nunavut Defendants brought this application to strike the Statement of Claim against them on the grounds that the Federal Court was without jurisdiction. The Plaintiff, on the other hand, argued that the claim was within the maritime jurisdiction of the court. The motions Judge reviewed the applicable authorities, in particular Dreifelds v Burton, (1998) 38 OR (3d) 393, and noted that a matter will only fall to be determined by Canadian Maritime Law if it is sufficiently connected with navigation and shipping. She held that the claims had nothing to do with navigation and shipping and were grounded solely in common law principles of negligence. Accordingly, she concluded that the Court was without jurisdiction. She further held that the Nunavut Defendants were public authorities over whom the Court had no jurisdiction.
Provincial Court Jurisdiction – Steamship Inspectors - Offshore Accord
Secunda Marine Services Limited v. The Queen et al., 2003 NSSC 2
In this matter the Plaintiff shipowner had obtained an arbitration award against one of the Defendants in London for breach of a charterparty. The Plaintiff subsequently registered the award in the Federal Court and then brought this action against the charterer and against various related companies and the individual alleged to have effective control of all of the Defendants. The relief claimed by the Plaintiff was a declaration that the debts of the charterer were the debts of all of the Defendants and a declaration that the assets of one of the Defendants were the assets of the charterer. The Defendants brought this application challenging the jurisdiction of the Federal Court arguing that the declarations sought were matters of Property and Civil Rights and therefore within provincial jurisdiction. The Prothonotary, however, held that enforcement of foreign arbitral awards had long been considered within Federal Court jurisdiction. Further, the Federal Court had the implied jurisdiction necessary to enforce its judgements, including the recognition of the foreign arbitral award. The Prothonotary next considered the issue of the piercing of the corporate veil and concluded that it was arguable that the various Defendants were for many purposes one and the same entity and thus should not be entitled to the protection of incorporation as separate entities. The Prothonotary expressly did not decide this issue but merely decided that it was not plain and obvious the Plaintiff could not succeed. (Note: This case should be compared with that of the British Columbia Court of Appeal in Pan Liberty Navigation Co. Ltd. v World Link (HK) Resources Ltd., 2005 BCCA 206 (summary), and TMR Energy Limited v. State Property Fund of Ukraine et al., 2005 FCA 28 (summary))
Jurisdiction - Rail Carriage
Herrenknecht Tunnelling Systems USA Inc. v. Canadian Pacific Railway, 2002 FCT 1089
The issue in this case was whether the Federal Court had jurisdiction over a claim for damage caused to cargo during the course of carriage from Quebec to Tacoma, Washington. The cargo was damaged when the train derailed in Ontario. The Judge identified the test as being: 1. There must be a statutory grant of jurisdiction by the federal parliament; 2. There must be an existing body of federal law which is essential to the disposition of the case and which nourishes the statutory grant of jurisdiction; and, 3. The law on which the case is based must a “law of Canada” as the phrase is used in s. 101 of the Constitution Act. The Judge found the statutory grant of jurisdiction in s.23(c) of the Federal Court Act which vests the court with jurisdiction in all cases where a claim for relief or a remedy is sought in relation to works and undertakings connecting one province with any other province. The second branch of the test was met by sections 113 and 116 of the Canada Transportation Act which oblige railways to receive, carry and deliver cargo and which provide a right of action to any person against a railway for neglect or refusal to fulfill its service obligations. Finally, the Judge held that the Canada Transportation Act was a “law of Canada” within the meaning of s. 101 of the Constitution Act and hence satisfied the third branch of the test.
Arrest - Release - Security - Arbitration - Jurisdiction - Meaning of Ship
Cyber Sea Technologies Inc. v. Underwater Harvester, 2002 FCT 794
In this matter a submersible was arrested and the Defendant brought an application, inter alia, to release the submersible without bail or, in the alternative, to post security. The grounds for the Defendant’s application were that the action was without merit and that the dispute was subject to arbitration. The Prothonotary held that it is only in exceptional circumstances that a vessel will be released from arrest without bail. Moreover, the fact that the dispute was subject to arbitration did not disentitle the Plaintiff to security. The fact of arbitration was, however, relevant to the amount of security. In setting the amount of the security the Prothonotary took into account that each party was required to pay its own costs of the arbitration.
Another issue was whether a submersible device used to cut trees in a flooded but unlogged reservoir was a ship so as to attract the admiralty jurisdiction of the Federal Court. The Prothonotary referred to the definition of ship in the Federal Court Act, being, “any vessel or craft designed, used or capable of being used solely or partly for navigation, without regard to the method or lack of propulsion...”. The Prothonotary noted that this was a very general and broad definition that seemed to encompass anything on or in the water and ultimately concluded that the submersible was, in all probability, a ship and that the Federal Court therefore had jurisdiction.
Jurisdiction - Fisheries - Agency
Radil Bros. Fishing Co. Ltd. v. Her Majesty the Queen et al., 2001 FCA 317
The facts of this case are quite complicated involving licence swaps, fishing quotas and catch history. One of the issues in the case was whether the Federal Court had jurisdiction to entertain a claim arising out of an agreement of purchase and sale of a fishing licence. The Federal Court of Appeal concluded that such a claim did not fall under section 91(10) of the Constitution Act (navigation and shipping) as it was more specifically dealt with under section 91(12) (Sea Coast and Inland Fisheries). The Federal Court of Appeal also extensively reviewed the jurisprudence in relation to the definition of Canadian Maritime Law and concluded that Canadian Maritime Law does not include a claim arising out of an agreement to purchase a fishing licence or to matters arising out of a breach of an agency contract entered into for the purpose of purchasing a fishing licence. The Court of Appeal noted that agency claims cannot be entertained under the court’s admiralty jurisdiction “ unless the true essence of the contract relied upon is maritime”.
Stay of Proceedings - Insurance - Jurisdiction - Marine - Insurance - Brokers
Royal & Sun Alliance v. The “Renegade III”, 2001 FCT 1050
This was an application for a stay of proceedings. The applicant was the owner of the Defendant yacht which had been damaged during the 2000 Victoria-Maui race. The applicant made a claim under his insurance policy for approximately $122,000 which was paid except for the sum of approximately $12,000. Subsequent to the payment the underwriters learned of circumstances which might void the policy and advised the applicant of this. On the same day the applicant commenced proceedings in the British Columbia Supreme Court for payment of the $12,000 he alleged was owing under the policy. Underwriters later did purport to void the policy for material non-disclosure and commenced in rem and in personam proceedings in the Federal Court claiming the return of the moneys paid. The applicant then brought this motion to stay the Federal Court proceedings. The application for a stay was denied. The Prothonotary noted that the Court would grant a stay only in the clearest of cases. The onus was on the applicant to prove (1) the continuation of the action would cause prejudice or injustice, not merely inconvenience or additional expense and (2) the stay would not be unjust to the Plaintiff. The Prothonotary held that although the British Columbia Supreme Court was a convenient forum it was not clearly the more appropriate forum. The Prothonotary noted that if underwriters were forced to bring their claim in the British Columbia Supreme Court they could not bring an in rem action by way of counterclaim and would have to start new proceedings and arrest the vessel for a second time. Further, the Prothonotary noted, without deciding, that there might be an issue as to whether the British Columbia Supreme Court had in rem jurisdiction. The Prothonotary concluded that there was no real prejudice or injustice to the applicant and that to allow the stay would deprive the underwriter of a legitimate juridical advantage. It is noteworthy that during the course of his reasons the Prothonotary considered whether a claim by the assured against his broker could be properly brought in the Federal Court. The Prothonotary seemed to suggest that Canadian maritime law had developed to the point where claims against brokers in a marine insurance context might be within the jurisdiction of the Federal Court.
Jurisdiction - Claims against Crew Members - Inducing Breach of Contract
Ruby Trading S.A. v. Parsons et al.,  2 FC 174
This matter concerned the jurisdiction of the Federal Court to entertain an action by a foreign ship owner against foreign crew members for breach of contract of employment and against a Canadian union for inducing breach of contract. While the "Japan Rainbow II" was loading a cargo of grain wage demands were made by the Defendants which were not satisfied by the Plaintiff. A strike sign was posted on the ship which resulted in the cessation of the loading activities. The Plaintiff then commenced this proceeding and obtained an injunction restraining the picketing for 14 days. The order granting the injunction was appealed but as the loading was completed during the time the injunction was in effect the issue of the appropriateness of the injunction was moot and the Court of Appeal declined to hear argument on this point. The Court of Appeal did, however, agree to adjudicate the issue of whether the Federal Court had jurisdiction to hear the claim of the Plaintiff. The Defendant argued that it did not have jurisdiction as the claims were in personaum and not in rem, did not fall within the maritime jurisdiction of the court and jurisdiction was specifically assigned by the Canada Labour Code to the Canada Industrial Relations Board. The Plaintiff argued that the claims fell within the court’s admiralty jurisdiction.
The Court of Appeal reviewed the authorities and reiterated that the test for jurisdiction was threefold: (1) there must be a statutory grant of jurisdiction by Parliament; (2) there must be an existing body of federal law essential to the disposition of the case that nourishes the grant of jurisdiction; and (3) the law on which the case is based must be a "law of Canada" as that phrase is used in s. 101 of the Constitution Act. The Court of Appeal held that all three branches of this test had been met. The statutory grant of jurisdiction was found in s. 22 of the Federal Court Act and the nourishing law and the "law of Canada" was found in Canadian maritime law. The Court of Appeal held that the claims advanced were integrally connected with maritime matters as to be legitimate Canadian maritime law. The Court of Appeal expressly held that it did not matter that the claims were in personam and not in rem as the court had jurisdiction in either event. The Court of Appeal further held that the Canada Labour Code had no application as it did not govern relations between a foreign ship owner and a foreign crew. In the result, it was held that the Federal Court had jurisdiction.
Jurisdiction - Breach of Agreement of Sale
John E. Canning Ltd. v. Tripap Inc., 2000 CanLII 15207
This was an application to dismiss the Plaintiff’s claim on the grounds that it was not a maritime matter and the Federal Court lacked jurisdiction. The claim arose from an agreement between the Plaintiff and Defendant pursuant to which the Plaintiff had agreed to sell and deliver by barge wood to the Defendant. The Defendant later purported to terminate the agreement on the grounds that the Plaintiff had failed to perform its obligations. The Plaintiff then brought this action alleging that the Defendant breached the agreement without cause and sought damages including expenses covering the barge. The Court held that, although the agreement between the parties included some undertakings involving maritime matters, the sole claim advanced of unlawful termination of a purchase and sale agreement had nothing to do with the marine aspects of the agreement. In the result, the Court held that it was without jurisdiction and dismissed the claim.
Claim for Freight - Set-off - Jurisdiction - Warehousing
Pantainer Ltd. v. 996660 Ontario Ltd., 2000 CanLII 15080
This was a claim for freight charges owing. The Defendant alleged that it was entitled to a set-off for damage caused to cargo carried by the Defendant. The Court held the general rule was that freight is to be paid without deduction and that the Defendant accordingly had no right of set-off.
One of the issues in this case was whether the Defendant’s counterclaim against the Plaintiff for damage caused to cargo in a warehouse after the carriage by sea was within the jurisdiction of the Federal Court as coming under maritime law. The Court held that claims for warehousing and storage that arose out of contracts of the carriage of goods by sea are within the jurisdiction of the Court.
Federal Court Jurisdiction Breach of Fishing Agreement
Inter Atlantic Canada Ltd. v. The Rio Cuyaguateje, 2000 CanLII 14805
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.