Canadian National Railway Company v. Hanjin Shipping Co Ltd

In Admiralty Practice, Pleadings on (Updated )

PrĂ©cis: A motion by the Owner of the “Hanjin Vienna” to strike the Statement of Claim of the Canadian National Railway Company on the grounds that it disclosed no cause of action or was scandalous, frivolous or vexatious was dismissed.

Facts: Following the well publicized bankruptcy of Hanjin Shipping Co. Ltd. in 2016, the “Hanjin Vienna”, a ship under long term time charter to Hanjin, was arrested at Vancouver in the Federal Court. The plaintiff had provided rail services to Hanjin, including to the “Hanjin Vienna”, and was allegedly owed approximately $20 million in respect of these services. The plaintiff commenced this action against Hanjin and various vessels owned or chartered by it, including the “Hanjin Vienna”. The owner of the “Hanjin Vienna” then brought this application to strike the claim of the plaintiff as against it.

Decision: Application dismissed.

Held: The owner of the “Hanjin Vienna” brings this application to strike the statement of claim on the grounds that it discloses no reasonable cause of action or is scandalous, frivolous or vexatious. The burden on the owner is a heavy one. If there is a chance the plaintiff might succeed, the action should be allowed to continue. The plaintiff alleges that it has a maritime lien by virtue of s. 139 of the Marine Liability Act for services supplied to the vessel. The owner says that there can be no such lien as there is no contract between the owner and the plaintiff and therefore no personal liability on the part of the owner. However, it is not clear whether the personal liability of the owner is required for a lien under s. 139 of the Marine Liability Act. The plaintiff’s lien claim is therefore arguable. It is further arguable that the plaintiff’s claim is governed by Canadian maritime law. The claim of the plaintiff is arguably one for freight and may fall within s.22(1) of the Federal Courts Act. The Canada Transportation Act, S.C. 1996, c. 10, may also provide a basis for the plaintiff’s claims.