Stays of Proceedings - Case Summaries
The database contains 31 case summaries relating to Stays of Proceedings. 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.
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Jurisdiction Clause – MLA s.46 – Parallel Proceedings – Appeal from Prothonotary – Standard of Review
Ford Aquitaine Industries SAS et al. v. The “Canmar Pride” et al., 2005 FC 431
This action concerned the loss of or damage to several containers carried from LeHavre to Montreal. The damages were estimated at $6 million. The carriage was pursuant to a transportation services agreement which provided for American law and jurisdiction. The carrier under the transportation services agreement was OOCL but OOCL was expressly permitted to subcontract the carriage, which it did, to CP Ships. The Plaintiff originally commenced proceedings against only OOCL in a U.S. District Court. The Plaintiff attempted to discontinue those proceedings but was not allowed to do so. The Plaintiff also commenced this proceeding in the Federal Court against both OOCL and CP Ships. The Defendants brought this application to stay the Canadian proceedings. At first instance, the Prothonotary granted the application for a stay. He held that section 46 of the Marine Liability Act did not oust the court's jurisdiction under section 50 of the Federal Court Act to grant a stay on grounds other than a forum selection clause. He then applied the test from the decision of the British Columbia Court of Appeal in Westec Aerospace v Raytheon Aircraft Co., (1999) 173 DLR (4th) 498. That test was: 1) Are there parallel proceedings underway?; 2) If so, is the other jurisdiction an appropriate forum?; and, 3) Has the Plaintiff established by cogent evidence that there is some personal or juridical advantage available to him in the British Columbia action that is of such importance that it would be unjust to deprive him of it? The Prothonotary held that the Plaintiff had failed to meet the third element of that test. In this regard a main point argued by the Plaintiff was that a U.S. Court would apply the COGSA limit which was substantially lower than the limitation that would apply in a Canadian court applying the Hague-Visby Rules. The Prothonotary, however, considered that the issue of the applicable limitation would be argued in either court. On appeal, the appeal Judge first considered the appropriate standard of review from a discretionary order of a Prothonotary and noted that the test had been recently reformulated to require the reviewing judge to first determine whether the questions raised are vital to the final issue in the case. If so, the discretion should be exercised de novo and the reviewing judge need not consider the second branch of the test (whether the orders were clearly wrong). The appeal Judge considered the Prothonotary's decision final and thus proceeded to exercise her discretion de novo. The appeal Judge held that the Prothonotary had erred in applying the test from Westec. She considered that the Westec approach was incorrect in that it set up “loss of juridical advantage” as a separate test or step rather than weighing it with the other usual factors to be taken into account. Moreover, she considered that the objective was not just to determine if the foreign forum was equally appropriate to the domestic forum but whether it was more appropriate than the domestic forum. Nevertheless, weighing the relevant factors she concluded that the U.S District Court was a more appropriate forum and upheld the decision of the Prothonotary.
Motion – Jurisdiction – Stay Proceedings
DSL Corporation v. Bulk Atlantic Inc., 2003 FC 1061
The Plaintiff claimed against the Defendant for damage to steel pipe carried from Turkey to Houston. The Defendant applied to set aside the ex juris service of the Statement of Claim or stay the proceedings on the grounds there was no real and substantial connection between the matter and Canada. The Plaintiff was an American company, one of the Defendants was a Maltese company, the carrying vessel, which had not been arrested, was registered in Malta, the time charterer of the vessel was a Marshall Islands Company, and neither the actual nor intended ports of loading or discharge were in Canada. The ships agent in Houston had however advised the Plaintiff that their principals were Atlantic Maritime Inc. of Montreal. The Prothonotary held that the latter advice created a connection with Canada and relied upon United Nations v. Atlantic Seaways Corporation  2 F.C. 541 for the proposition that the court's jurisdiction in respect of cargo claims extended beyond Canada. The Prothonotary did indicate that he might have considered ordering a stay in favour of Texas if the Defendants had been willing to waive the time bar defence.
Motion to Dismiss – Stay – Parallel Proceedings
Vilhena Shipping Ltd. v. Agro-hall Ltd., 2003 FCT 756
This was an application by the Defendant to dismiss the proceedings or, alternatively, for a stay of proceedings. The ground for the application was that the Plaintiff had commenced parallel proceedings for the same relief in France. The Plaintiff had attempted to withdraw those proceedings but this was not allowed by the French Tribunal. Under the circumstances the Prothonotary declined to dismiss the Plaintiff's action since it was possible that the Plaintiff's application to withdraw the French proceedings would be allowed on appeal. However, the Prothonotary did order that the action be stayed to avoid duplication of costs and the risk of conflicting judgements.
Application to Strike – Lis Pendens – Stay of Proceedings – Forum non conveniens – Arrest – Amount of Security - Motions – Foreign Affidavits
A. Paschos K. Katsikopoulos S.A. v. The “Polar” et al., 2003 FCT 584
This was an application to strike out the Statement of Claim because the Plaintiff had commenced an earlier action in Greece involving the same parties or, in the alternative, to stay the proceedings on the basis of forum non conveniens. The court was also requested to review the amount of the security that had been provided by the Defendants to obtain the release of the “Polar” from arrest. The application to strike on the basis of lis pendens was not granted because the Plaintiff was prepared to withdraw its action in Greece in favour of maintaining its action in Canada alone. However, the Court did order that the action be stayed on the grounds that there was no connection between any aspect of the litigation and Canada other than the temporary presence of the vessel in Canada. This order was subject to the condition that the letter of credit in place in relation to the Canadian litigation be maintained and amended to include payment of any judgment that may emanate from the Greek courts. Finally, regarding the amount of security, the Court declined to interfere because the bond reflected an amount sufficient to cover the reasonably arguable best case of the Plaintiff together with interest and costs.
As a preliminary motion to the application to strike out the Statement of Claim, the Defendant sought to strike out the Plaintiff’s affidavits because the notary public who took the affidavits failed to comply with the requirements of Greek law, the law of the place where they were taken, as to the terms and conditions that ought to surround the administration of oaths to affiants. Even on the assumption that the Defendants were right in their criticism of the work performed by the Greek notary public, it did not follow that the affidavits should be struck. There was no evidence of any collusion between the affiants and the notary public with a view to contravening the requirements of Greek law. The record indicated that at all relevant times the affiants wished to file some allegations that they considered true and, “within the context of [his] residual discretion”, the Prothonotary considered this to be the essential thing. To strike out the impugned affidavits owing to deficiencies attributable to the notary public would, in the circumstances, be akin to elevating form over substance, and this the Prothonotary refused to do.
Appeals - Stay Pending Appeal
Saskatchewan Wheat Pool v. Armonikos Corp. Ltd., 2002 FCA 444
In this matter the Appellant applied for a stay of a judgement pending appeal. The judgement appealed from had ordered that the Federal Court proceedings be stayed in favour of London arbitration pursuant to an arbitration clause in a charter party. The court noted that the test to be applied was three-fold: (a) there must be a serious issue to be tried; (b) the applicant must show irreparable harm will result if a stay is not granted; and, (c) that the balance of convenience favours granting a stay. The court held that the first part of the test had been met as the appeal was not frivolous or vexatious. The court held the second part of the test had also been met in that the London arbitration had already and prematurely been commenced and the Appellant had lost its right to appoint an arbitrator. Moreover, if the Respondent obtained and collected an award, the Appellant would not be able to recover the payment, if successful on the appeal, as the Respondent had no Canadian assets. Finally, on the question of balance of convenience, the court held that the balance favoured granting the stay to avoid the costs and effort of the arbitration and because the Appellant was prepared to post security.
Service Ex Juris - Stay of Proceedings
Continental Insurance Co. v. Almassa International Inc., 111 ACWS (3d) 470
This matter concerned a cargo policy taken out by a Quebec merchant from an Ontario based insurer insuring a cargo of lumber carried from Quebec to Saudi Arabia. During the course of the voyage the ship suffered engine damage and called at an intermediate port for repairs. As a result of the delay, the lumber cargo was damaged and a claim was made under the policy. The insurer initially made a payment on account but later denied coverage. The assured brought an action in Quebec against the insurer and the insurer brought an action in Ontario against the assured to recover the monies paid. The assured brought the present motion to stay the Ontario proceedings. The motion was granted. The motions Judge held that mere residency of the insurer in Ontario was insufficient to create a real and substantial connection with Ontario and that the appropriate forum was Quebec. The judgement was appealed. In a short endorsement the Ontario Court of Appeal affirmed the decision of the motions Judge.
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.
Stay of Proceedings - Convenient Forum
Nissho Iwai Company Limited et al v. Shanghai Ocean Shipping Company, 2000 CanLII 15777
This was an application to stay proceedings on the grounds that Canada was not the convenient forum. The action arose out of the grounding of the "Ning Hai" in the Kurile Islands and the consequent loss of the Plaintiff’s cargo. The Plaintiff alleged that the Defendant, as provider of the officers and crew of the "Ning Hai", owed it a duty of care to provide competent and qualified officers and crew and that it breached this duty. The Defendant argued that the Peoples Republic of China was a more convenient forum for the dispute because the officers and crew were Chinese nationals and were trained in China, the Defendant was a Chinese corporation and the grounding occurred far away from Canada. The Plaintiff argued that Canada was a convenient forum because the cargo was loaded in Canada, the charterer was Canadian, and there were a number of witnesses in Canada who had the opportunity to observe the competence of the crew before it left on the fateful voyage. The Plaintiff further argued that there would be no discovery of documents or examinations for discovery in China. The Court held that the fundamental issue in the dispute was the competence of the crew and that most, if not all, of the evidence on this issue was in China. In result, the Court allowed the motion and stayed the proceedings.
Limitation Proceedings - Stay of Action
Canadian Pacific Railway Company v. The "Sheena M" et al.,  4 FC 159
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,  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.
Stay of Proceedings - Jurisdiction Clause
Mitsui & Co. v. The "Evelyn", 1998 CanLII 5872 (BC SC)
This was an application to stay proceedings in British Columbia in favour of Japan. The action was for damage to a cargo of coils shipped from Japan to British Columbia. The Defendants relied upon a jurisdiction clause in the bills of lading selecting the Tokyo District Court as the appropriate forum. The motions judge followed well established case law to the effect that such clauses will be enforced unless the Plaintiff can show "strong cause" to override the agreement. The motions judge held that the Plaintiff had not shown "strong cause" for not enforcing the jurisdiction clause. The factors that the motions judge thought were persuasive were: that the contract was subject to Japanese law; that the shipper was a Japanese company; that the evidence of pre-shipment damage was in Japan; and that the Defendant had agreed to waive any time bar.
Stay of Proceedings
Humble v. The "Queen of Alberni", Reg. No.C940031, (B.C.S.C.)
This was an application by the Defendant for a stay of the Plaintiff's action on the grounds that there were similar actions pending in the Federal Court of Canada. The Defendant wanted all actions consolidated. The British Columbia Supreme Court refused the application on the basis that the Plaintiff's claim might be time barred in the Federal Court and the Federal Court actions concerned some matters which were not relevant to the Plaintiff.