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Information Note on the Use of Forum Non Conveniens in Canada Presented by the Canadian Delegation

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BACKGROUND

In Canada, the doctrine of forum non conveniens is now well recognized as part of the law, both in the common law provinces and in the civil law province of Québec.

The most recent leading authority in Anglo-Canadian common law is that of the Supreme Court of Canada in Amchem Products Inc. v. B.C. (W.C.B.), [1993] 1 S.C.R. 897. In Québec, the rule was codified in Article 3135 of the new Civil Code that was promulgated on January 1, 1994.

In both legal systems, a number of cases have applied the doctrine of forum non conveniens between Canadian provinces as well as in actions involving foreign States.

The Uniform Law Conference of Canada (ULCC) has also proposed in its 1994 Uniform Court Jurisdiction and Transfer of Proceedings Act that proceedings be transferred to other courts in Canada or abroad under certain conditions. To date, no Canadian province has adopted the Uniform Act.

DISCUSSION

The Amchem decision has articulated a new test for identifying the proper forum, moving from the traditional English law (oppression to the defendant and injustice to the plaintiff). In the opinion of Justice Sopinka (at pp. 919-921), the test before applying the rule on forum non conveniens includes the following elements:

-- the determination of any juridical advantages to the plaintiff or the defendant;
-- the qualification of the parties' connection to the jurisdiction as real and substantial; and
-- the existence of a more appropriate jurisdiction based on the relevant factors.

Justice Sopinka also discussed (at p. 921) the issue in relation to service outside the province (ex juris). In his view, the question remains the same whether the defendant is served in the jurisdiction or outside. "Whether the burden of proof should be on the plaintiff in ex juris cases will depend on the rule that permits service out of the jurisdiction. If it requires that service out of the jurisdiction be justified by the plaintiff, ..., then the rule must govern... While the standard of proof remains that applicable in civil cases, I agree with the English authorities that the existence of a more appropriate forum must be clearly established to displace the forum selected by the plaintiff."

The Amchem test has been codified in Article 11 of the above-mentioned ULCC Uniform Act. In addition to a restatement of the principles enunciated by the Supreme Court, the Uniform Act also contains a list of factors relevant to the exercise of the court's discretion when examining the question of forum non conveniens. Part 3 of the Uniform Act provides for a detailed procedure for the transfer of proceedings on the basis of a court's order requesting another court to accept the transfer if the court making the order is satisfied that "the receiving court has subject matter competence in the proceeding and ... is a more appropriate forum..." (article 14).

In Québec, Article 3135 of the Civil Code, the text of which is attached, provides in very general terms the circumstances in which forum non conveniens may be invoked as follows:

-- although the Québec authority has jurisdiction, the situation is exceptional; and
-- the authorities of another country are in a better position to decide.

It should be noted that the reverse doctrine of forum conveniens, which has also been codified in Article 3136, may apply on certain conditions as follows:

-- the dispute has a sufficient connection with Québec; and
-- proceedings cannot possibly be instituted outside Québec or their institution cannot be reasonably required.

In both the common and civil law systems in Canada, case law has developed and refined the interpretation of the doctrine of forum non conveniens. However, some uncertainty remains on the exact limits of its application. Procedural questions have also arisen.

For instance, does the appearance of the defendant before a foreign court to challenge its jurisdiction constitute attornment? On this point, the decision of the British Columbia Court of Appeal in Mid-Ohio Imported Car Co. v. Tri-K Investments Ltd., [1996] 2 W.W.R. 144, stated that a defendant may dispute an order for service ex juris upon him and challenge jurisdiction without being considered to attorn to the foreign court's jurisdiction. To go beyond this would run afoul of the strict rule at common law. This approach was based on the law of British Columbia and not the law of the court of origin which was not considered.

Another procedural question has to do with a stay of proceedings when forum non conveniens is invoked. Although a stay of proceedings would be granted pending the introduction of proceedings in the foreign forum, it has not been fully resolved whether or not a stay would be granted in the face of other proceedings already commenced or about to be commenced in the other court.

CONCLUSION

The theory of forum non conveniens is now well accepted in Canada and the state of the law appears to be settled on this point. However, the legal community has expressed fears concerning resultant concurrent proceedings and forum shopping that may prove to be disadvantageous to Canadian parties to international litigation. It has also identified a need to provide for clearer rules in order to secure fairness and predictability in international proceedings.

One avenue would be to establish acceptable and prohibited bases of jurisdiction that would be followed by courts in a large number of countries without judicial discretion to take or decline that jurisdiction. Another would be to allow domestic courts, on the basis of compelling and well-recognized factors, to use their discretion in deciding whether or not to take jurisdiction.

The Hague project on judgments might therefore provide an opportunity to examine various national solutions and lead to better understanding and use of forum non conveniens and in the process address these and related concerns.

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