Arc-En-Ciel Produce Inc. v. BF Leticia (Ship)

In Admiralty Practice, Carriage of Goods by Sea, Stays of Proceedings, Uncategorized on

Facts: The plaintiff brought an action against the defendant carrier after cargos of fruit arrived damaged in Canada. The defendant sought to enforce the forum selection clause in its standard shipping documents seeking to have the action heard in the US District Court. The matter was heard by the Federal Court (2020 FC 23) and then appealed to the Federal Court of Appeal by the defendant carrier (2021 FCA 70) which remitted the matter back down to the Federal Court to determine if s. 46(1) MLA applies to the claim. At issue was whether the carrier’s shipping documents was a contract of carriage by water to which s. 46 MLA applied. If s. 46 MLA applies to the claim, the suit may be brought in Canada despite the forum selection clause.

Decision: S. 46 MLA does not apply; forum selection clause is enforceable.

Held: The court interpreted “contract of carriage of goods by water” in light of the Hague-Visby Rules in the MLA. Hague-Visby applies to bills of lading or other similar documents of title. The Court found that for the shipping document to be a bill of lading, it must be a receipt for the goods, evidence the contract of carriage terms and be a document of title. Although the shipping document used the term “bill of lading’, the fact that the document was not signed and did not need to be presented for delivery of the cargo weighed against it being a bill of lading. The Court held the shipping document was akin to a waybill, which is not a document of title and so Hague-Visby does not apply. S. 46 MLA only applies to bills of lading or other documents of title and therefore the shipping document was not covered by s. 46. The Court also held that the plaintiff did not establish a strong cause to avoid the effect of the forum selection clause.