JICP SUMMARY 2004
I. Introduction – Scope of Course _______________________________________________________ 5
II. Litigation and Other Forms of Dispute Resolution _______________________________________ 5
A. Forms of Dispute Resolution _______________________________________________________ 5
Litigation ________________________________________________________________________ 7
B. Problems with Litigation as a Form of Dispute Resolution_______________________________ 8
C. The Rise of Arbitration __________________________________________________________ 10
QUEBEC _______________________________________________________________________ 11
ONTARIO ______________________________________________________________________ 12
D. The advantages and disadvantages of arbitration _____________________________________ 14
III. The Economics of Litigation _______________________________________________________ 15
A. Costs Charged by the Courts ______________________________________________________ 15
QUEBEC _______________________________________________________________________ 15
ONTARIO ______________________________________________________________________ 16
B. Lawyers’ Fees __________________________________________________________________ 16
QUEBEC _______________________________________________________________________ 16
ONTARIO ______________________________________________________________________ 17
1) Contingency fees _______________________________________________________________ 19
QUEBEC _____________________________________________________________________ 19
ONTARIO ____________________________________________________________________ 20
2) Legal Aid _____________________________________________________________________ 22
3) Legal Insurance ________________________________________________________________ 22
4) Legal Assistance _______________________________________________________________ 22
C. Costs Awarded to a Party ________________________________________________________ 22
QUEBEC _______________________________________________________________________ 22
ONTARIO ______________________________________________________________________ 23
D. Liability for Instituting Proceedings ________________________________________________ 25
QUEBEC _______________________________________________________________________ 25
ONTARIO ______________________________________________________________________ 26
E. Costs in Arbitration _____________________________________________________________ 26
IV. The Lawyer _____________________________________________________________________ 27
A. Overview of Legal Profession _____________________________________________________ 27
QUEBEC _______________________________________________________________________ 27
ONTARIO ______________________________________________________________________ 28
B. The Practice of Law _____________________________________________________________ 29
C. Representation _________________________________________________________________ 33
1) Personally ____________________________________________________________________ 33
2) By lawyer ____________________________________________________________________ 34
GENERAL _____________________________________________________________________ 34
Exceptions to above propositions ____________________________________________________ 34
1. There are litigants who are not allowed to represent themselves. ________________________ 34
QUEBEC ___________________________________________________________________ 34
ONTARIO __________________________________________________________________ 35
2. Litigant cannot be represented by lawyer. __________________________________________ 35
QUEBEC ___________________________________________________________________ 35
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Ontario _____________________________________________________________________ 36
3) Representation by non-lawyer ___________________________________________________ 36
QUEBEC ___________________________________________________________________ 36
ONTARIO __________________________________________________________________ 36
D. Lawyer-Client Relationship _______________________________________________________ 37
QUEBEC _______________________________________________________________________ 37
ONTARIO ______________________________________________________________________ 40
Consensual Relationship ___________________________________________________________ 41
1. Conflict of interest ____________________________________________________________ 41
Quebec _____________________________________________________________________ 44
ONTARIO __________________________________________________________________ 44
2. Being called as witness ________________________________________________________ 46
QUEBEC ___________________________________________________________________ 46
ONTARIO __________________________________________________________________ 46
Changing lawyers ________________________________________________________________ 46
QUEBEC _____________________________________________________________________ 47
ONTARIO ____________________________________________________________________ 47
1. From Client _________________________________________________________________ 48
2. Disciplinary proceedings _______________________________________________________ 51
3. To court ____________________________________________________________________ 51
Ontario _____________________________________________________________________ 51
Quebec _____________________________________________________________________ 51
4. Contempt of court. ____________________________________________________________ 52
5. Liability to 3rd parties. _________________________________________________________ 52
V. The Judge _______________________________________________________________________ 53
A. Appointment of Judges___________________________________________________________ 53
Federally appointed judges _________________________________________________________ 54
Inferior court justices ______________________________________________________________ 55
QUEBEC _____________________________________________________________________ 55
B. Judicial Independence ___________________________________________________________ 56
I. Security of Tenure and Discipline __________________________________________________ 56
Federally appointed judges _______________________________________________________ 56
Provincially Appointed Judges ____________________________________________________ 59
II. Salaries ______________________________________________________________________ 61
Federally Appointed Judges ______________________________________________________ 61
Provincially appointed judges _____________________________________________________ 62
III. Administrative Independence ____________________________________________________ 63
3. Judicial Immunity _______________________________________________________________ 64
Can you sue a judge? ______________________________________________________________ 64
Judicial immunity from testifying ____________________________________________________ 65
4. Recusation _____________________________________________________________________ 65
5. Judicial Powers _________________________________________________________________ 69
a. Contempt of court ______________________________________________________________ 69
QUEBEC _____________________________________________________________________ 72
ONTARIO ____________________________________________________________________ 72
b. Parens patriae__________________________________________________________________ 73
c. General inherent power __________________________________________________________ 74
VI. The Organization of the Courts _____________________________________________________ 75
A. Trial Courts ____________________________________________________________________ 75
B. Appeal Courts - Generally ________________________________________________________ 76
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C. Court Structure in Quebec _______________________________________________________ 79
Superior court ___________________________________________________________________ 79
Inferior court ____________________________________________________________________ 79
Small claims court ________________________________________________________________ 80
Court of Appeal – Jurisdiction (Final Judgment) ________________________________________ 84
Interlocutory Appeals Before the Beginning of a Trial __________________________________ 86
Interlocutory Appeals After the Beginning of a Trial ___________________________________ 86
Interlocutory or Final? _____________________________________________________________ 87
Geography/organization of the courts _________________________________________________ 89
D. Ontario________________________________________________________________________ 89
Courts of first instance _____________________________________________________________ 89
Appellate Courts _________________________________________________________________ 90
Geography/organization of the courts _________________________________________________ 93
E. Federal Court __________________________________________________________________ 93
Federal Court Act – Trial Division ___________________________________________________ 94
Federal Court Act – Appeal division __________________________________________________ 94
F. Supreme Court of Canada ________________________________________________________ 98
SCC as court of appeal ____________________________________________________________ 98
SCC as court of original jurisdiction __________________________________________________ 99
VII. Territorial Jurisdiction of the Courts ______________________________________________ 101
A. Statutory or Common Law Jurisdiction ____________________________________________ 101
QUEBEC ______________________________________________________________________ 102
Rules regarding jurisdiction ______________________________________________________ 102
Internet Law________________________________________________________________ 106
Special rules: _______________________________________________________________ 107
Procedural matters ___________________________________________________________ 107
ONTARIO _____________________________________________________________________ 108
B. Jurisdiction based on consent ____________________________________________________ 113
QUEBEC ______________________________________________________________________ 113
ONTARIO _____________________________________________________________________ 114
C. Discretion in the exercise of territorial jurisdiction ___________________________________ 115
ONTARIO _____________________________________________________________________ 115
QUEBEC ______________________________________________________________________ 118
D. Recognition of foreign judgments _________________________________________________ 119
ONTARIO _____________________________________________________________________ 119
QUEBEC ______________________________________________________________________ 127
VIII. The Parties ___________________________________________________________________ 129
A. The Plaintiff___________________________________________________________________ 129
1. Capacity/Quality ______________________________________________________________ 130
QUEBEC ____________________________________________________________________ 130
ONTARIO ___________________________________________________________________ 131
2. Interest to sue/Standing _________________________________________________________ 131
Private law ___________________________________________________________________ 131
Public law ___________________________________________________________________ 132
3. Vexatious Proceedings _________________________________________________________ 134
4. Multiple Plaintiffs (Class Actions) ________________________________________________ 135
QUEBEC – Class Actions _______________________________________________________ 137
Ontario – Class Actions _________________________________________________________ 141
B. The Defendant _______________________________________________________________ 145
1. Capacity _____________________________________________________________________ 145
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2. Interest ______________________________________________________________________ 145
3. Multiple Defendants ___________________________________________________________ 145
IX. The Issue ______________________________________________________________________ 146
A. Issues that are moot ____________________________________________________________ 146
B. Arbitration____________________________________________________________________ 147
C. Justiciability __________________________________________________________________ 147
D. Issue which has already been decided, or which is pending before another court – Lis
Pendens/Res Judicata ______________________________________________________________ 148
QUEBEC ______________________________________________________________________ 148
ONTARIO _____________________________________________________________________ 150
E. Joinder of Issues _______________________________________________________________ 152
QUEBEC ______________________________________________________________________ 153
ONTARIO _____________________________________________________________________ 154
X. The Exchange of Pleadings ________________________________________________________ 156
A. Alternative Proceedings _________________________________________________________ 156
ONTARIO _____________________________________________________________________ 156
Applications __________________________________________________________________ 156
Actions______________________________________________________________________ 157
QUEBEC ______________________________________________________________________ 158
Exchange of pleadings ____________________________________________________________ 158
B. Motion to Institute Proceedings or Statement of Claim _______________________________ 159
ONTARIO _____________________________________________________________________ 159
QUEBEC ______________________________________________________________________ 161
C. Appearance or Notice of Intention to Defend ________________________________________ 163
QUEBEC ______________________________________________________________________ 163
ONTARIO _____________________________________________________________________ 163
D. Defence or Statement of Defence __________________________________________________ 164
QUEBEC ______________________________________________________________________ 164
ONTARIO _____________________________________________________________________ 166
E. Cross-Demand or Counter-Claim _________________________________________________ 167
XI. Interlocutory Matters ____________________________________________________________ 167
A. Procedure and Delays ___________________________________________________________ 167
QUEBEC ______________________________________________________________________ 168
ONTARIO _____________________________________________________________________ 169
B. Security for Costs ______________________________________________________________ 170
QUEBEC ______________________________________________________________________ 170
ONTARIO _____________________________________________________________________ 170
C. Dismissal of Proceedings or Determination of Issues _________________________________ 171
QUEBEC ______________________________________________________________________ 171
ONTARIO _____________________________________________________________________ 172
D. Matters relating to pleadings _____________________________________________________ 173
1. Motions for particulars _________________________________________________________ 173
QUEBEC ____________________________________________________________________ 173
ONTARIO ___________________________________________________________________ 174
2. Amendments _________________________________________________________________ 174
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I. Introduction – Scope of Course
 Dispute → solution. The solution is typically the court judgment. But we rarely look at what
leads up to outcome.
 We will look at judge, court system, lawyers, process that leads up to judgment.
 Why is procedure important:
1. It is essential to the practice of law.
2. It helps to understand other areas of law. Even if you know what your rights are in a
given situation, that knowledge is useless if you don’t know how to exercise a right or
how much it costs you to exercise it. A right is useless w/o a remedy. We will be
looking at the economics of litigation.
3. There are problems with current litigation system in Quebec and Ontario. Must
determine whether legislature is appropriately dealing with problems. Many
commentators think that it is currently too complicated or expensive to litigate.
Academics want to make the system more efficient.
 There are 3 parts to the course:
1. Alternatives to traditional litigation, economics.
2. Judge, courts, lawyers.
3. Civil procedure (i.e., exchange of pleadings, interlocutory matters, discovery (exchange
of evidence before trial))
 There are deficiencies of trial by ambush (i.e., no discovery)
1. Cannot settle because don’t know how strong other party’s case is.
2. Inefficiency: when surprise witness testifies, need recess to prepare witness to rebut.
 Limits on scope of course:
1. There is specialized court procedure for certain disputes that we don’t look at (e.g.,
criminal, family, bankruptcy)
2. There are specialized tribunals in certain areas (e.g., rental board, labour)
3. Procedural rules in Federal court are similar to those in Ontario.
II. Litigation and Other Forms of Dispute Resolution
A. Forms of Dispute Resolution
 There are a continuum of different ways to settle a dispute:
More formal,
adversarial
Negotiation Conciliation Mediation Arbitration Litigation
 Mediation, conciliation and negotiation are all win-win situations. They are designed so both
parties can walk away happy. In arbitration and litigation, there are winners and losers.
Negotiation
 No rules (procedural or otherwise).
 Only the parties are involved (no 3rd party decision-maker).
 Process is entirely consensual, cannot be forced to negotiate or agree.
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 A negotiated agreement to resolve a dispute is only legally binding because the parties have
agreed – in other words, it is a contract.
 In a negotiation, you are not limited in terms of the outcome that you can arrive at. Creative
solutions can be crafted to please the parties to the dispute.
Conciliation
 No rules, informal process.
 The difference between conciliation and negotiation is that a conciliation involves a neutral
3rd party (conciliator). He is neutral and plays a passive role. He has no decision-making power.
 A conciliator is involved to convey messages back and forth between the parties. He tries to
identify a common ground and to re-establish communications.
 Consensual process. Never obliged to go, never bound by result (exceptions in Labour law).
 The binding nature of agreements in conciliation is also based on mutual consent.
Mediation
 Informal process, no rules.
 Mediator is still assisting parties to voluntarily reach mutually acceptable solution.
 The 3rd party does not impose an outcome on the parties to the dispute but instead, plays a
more active role and tries to push the parties towards a solution. Mediator might structure
negotiations, make recommendations, articulate needs of parties, offer solutions (e.g., “If you
throw in an extra $50 000, I’ll get the other party to extend length of K.”).
Arbitration
 This refers to a wider range of dispute resolution processes.
 A neutral 3rd party renders a decision on merits of case, after presentation of evidence and
oral argument.
 The mediator tries to push the parties towards a mutually beneficial solution, whereas the
arbitrator imposes the solution.
 Parties have given power to make decision to 3rd party. Agree to be bound by decision.
 There are rules in CCP (Quebec) and Arbitration Act (Ontario), but parties do not have to
accept rules.
 Parties arbitrate because they can establish whatever procedures they deem the most useful.
This helps the parties get efficient justice at whatever time and under whatever process they
choose.
 Parties are also able to choose whoever they want to be the arbitrator. This can be a judge, an
accountant, a hockey coach… and the selection will be made based on the type of dispute.
 Parties are also able to set out rules with respect to the outcome.
i. Non-binding arbitration:
 Parties not bound by decision. Gives a sense of what a court would do and pushes the parties
to settle.
ii. Binding arbitration:
 Can choose procedure, and limit outcome to certain possibilities.
 Parties choose arbitrator.
 Parties choose procedure: to make oral argument, or argue by factum, to disclose evidence or
not.
 Can limit outcome to certain possibilities.
 The arbitrator’s decision is final.
iii. Final Offer Arbitrations (MLB arbitration)
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 Each party comes to the table with a number and the arbitrator chooses the most reasonable
one and the parties are stuck with it (forces parties to come up with reasonable numbers or they
will lose).
Arbitration Generally
 Voluntary: Cannot be forced unless you’ve agreed to go to arbitration or you agreed in
advance.
 Contractual mechanism: Arbitrator’s decision is binding because parties have agreed that it
would be.
 Enforceable only if you take decision, and ask court to declare it enforceable.
 Private process – nobody knows the results unless the parties publicize them.
 For each of these systems, parties don’t hate each other afterwards. Less formal, adversarial
than litigation.
 There are also issues which cannot be resolved by arbitration – i.e., you need the involvement
of courts. The most obvious examples are criminal and constitutional law.
Litigation
 This is the most formal and adversarial of the dispute resolution mechanisms.
 When parties are in a business relationship, it is easier to preserve that relationship when
there is a dispute using of the mechanisms other than litigation.
 Litigation, on its face, is not much different than formal arbitration - decision by 3rd party
after formal hearing during which evidence was presented and arguments made.
 Differences with arbitration:
1. Litigation is not a voluntary process: if one party decides to sue, you do not need the
consent of the other party to continue. The other party must be involved or risk having a
default judgment rendered. The only limitation is that the plaintiff decides where to sue
and the defendant has the right to contest the jurisdiction of the suit
2. Outcome of litigation is binding and enforceable - meaning that the successful plaintiff
can go to a bailiff and have the defendant’s property seized and sold.
3. The procedure and the structure of the institutions for litigation have been established and
paid for by the state, rather than by the parties:
 Parties cannot choose their procedure, rules or their decision-maker. Rather, the
state provides, the rules, procedures, judges (the only possible decision-maker),
courthouses, bailiffs which the parties only pay nominal fees for.
 The structure of the litigation system is provided by the state and placed at the
parties’ disposal.
4. Judge must choose from recourses sought by parties and recourse available at law.
 Judge is applying rule to facts to arrive at outcome. Not trying to find solution to
make everyone happy.
5. Litigation is a public process.
 Article 13 CCP: The sittings of courts are public… Anyone can walk in and
listen to details of dispute. All of the documentation is available for public
consumption at the courthouse (evidence and statements of claim).
 There is some ability to ask for things to be kept confidential or to use
pseudonyms (but this is exception – ex: family law).
 Essentially, litigation sucks and a wise lawyer will seek other methods of dispute resolution
before resorting to dispute resolution. Litigation is essentially for parties who are very
adversarial.
 The role of litigation has become more difficult because of 2 interrelated phenomena: the
increasing complexity of social relations leading to complex disputes and the increasing
litigiousness of society – courts are faced with more lawsuits.
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 Limitations on the use of litigation to resolve a dispute: Doctrines of Mootness and
Justiciability.
 We will focus on litigation because:
1. It is how most disputes are dealt with (ignoring negotiation)
2. It is ultimate fallback if you can’t resolve by other means. It is mandatory, binding.
3. It is basis for comparison with arbitration and mediation.
4. Other forms are too flexible to study. Hard to study arbitration → No Code.
B. Problems with Litigation as a Form of Dispute Resolution
 The state has created a 1-size fits all procedural system to fit the most cases but it is
not perfect for all cases. It is too complex for simple disputes and too simple for complex
disputes.
 2 issues:
(1) Access to justice
(2) Quality of justice
(1) Access to justice – Belleau, L’accessibilité à la Justice Civile et Administrative au Québec
 The criticism: litigation costs too much $, takes too long. Ordinary people don’t sue as the
costs provide a significant bar to the system for people who aren’t affluent.
 In 1990, 6 million lawsuits filed in Canada. 80% by banks, corporations, trusts, and
businesses. Only 20% by individuals.
 Expense very high relative to outcome: Average legal fees payable: $38 000, average size of
judgment: $58 000.
 Delays: between 2 and 3 years from starting a suit to receiving a judgment - longer with
appeal.
 A bank can pay $40 000 for a chance at $60 000 3 years later but I can’t.
 To improve access, legislature has been looking at ways to make lawsuits:
1. Easier
2. Cheaper
3. Quicker, more efficient
 Art. 2 CCP: Provisions must be interpreted to facilitate quick result, render justice.
2. The rules of procedure in this Code are intended to render effective the substantive law and to
ensure that it is carried out; and failing a provision to the contrary, failure to observe the rules
which are not of public order can only affect a proceeding if the defect has not been remedied
when it was possible to do so. The provisions of this Code must be interpreted the one by the
other, and, so far as possible, in such a way as to facilitate rather than to delay or to end
prematurely the normal advancement of cases.
 Art. 4.2 CCP: you shouldn’t do extensive discovery or appeal to the SCC for a $20 lawsuit.
4.2. In any proceeding, the parties must ensure that the proceedings they choose are
proportionate, in terms of the costs and time required, to the nature and ultimate purpose of the
action or application and to the complexity of the dispute; the same applies to proceedings
authorized or ordered by the judge.
 Rule 1.04 of ON Rules of Civil Procedure: Rules are meant to lead to just, cheap and efficient
dispute resolution.
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1.04 (1) These rules shall be liberally construed to secure the just, most expeditious and least
expensive determination of every civil proceeding on its merits.
 NOTE: In Ontario, detailed rules are in Rules of Civil Procedure. In Quebec, Code of Civil
Procedure contains detailed rules.
 There have been steps taken over past 5-10 years to address problem of access:
To make system simpler:
 Specialized Courts: In order to make things simpler, the legislature has created tribunals
dealing with specialized matters with its own procedures. An example is the rental board. You
don’t need a lawyer and the procedures are simple. Small claims court in QC forbids the
participation of lawyers altogether.
 Specialized Procedures:
o Ontario has a 2-size fits procedure. Rule 76 is the simplified procedure for cases worth
more than $25 000 and the regular procedure is for cases over $25 000. Small claims in
ON have their own procedure and these are for cases under $10 000.
o QC, in 1997, adopted a simplified procedure, like ON. $50 000 was the cutoff point. In
2003, QC deemed the simplified procedure to have been so good that it was extended
across the board. The regular procedure in Quebec is now the 1997 simplification.
To make litigation cheaper:
 If it’s simpler, will be cheaper.
 Cost awards: A successful litigant in Canada is awarded court costs from the other party.
These costs are supposed to cover all or most of the costs of litigation. This doesn’t exist in the
US.
 Legal Aid: The legal aid system was created in the 70’s in QC and ON. While it was initially
effective, it is now severely under-funded and available only to a small portion of the public.
 The Contingency Fee: It is an arrangement between client and lawyer whereby the lawyer is
not paid if the litigation is not successful but receives a percentage of the award if the suit is
successful. The payment to the lawyer is contingent on the outcome of the case. Contingency
fees make the system more available to plaintiffs by reducing risks. These fees are illegal at
common law but have been introduced by statute in all provinces. ON was the last holdout.
 Class actions: The class action allows one person to sue on behalf of a group of similarly
situated people. Instead of having 1000 CPA lawsuits, the company will only have one. There
are also funding rules so that the individual does not have to bear the entire cost of suing on
behalf of the class.
To make litigation quicker, more efficient:
 Mandatory mediation or conciliation. In Quebec, must sit down with judge of CA to try to
work out dispute. He will give you idea of where case is heading. At lower levels, have pre-trial
conference: encourage settlement.
 Discovery rules - Allow both parties to know most of the evidence in advance, allowing the
parties to know the strengths and weaknesses of the other case and their own – encouraging
settlements. Discovery is designed to avoid trial by ambush and the scheduling disasters that
would result.
 Pre-trial conferences with judge: Judge will identify specific issues, so that trial will be
shorter.
 Commercial cases? Will be dealt with by appropriate judge. Reducing backlog.
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 Power to dismiss frivolous actions: The have not always used this power in the past because
of the notion that people should have their day in court. Courts have moved away from this
recently (notably the QC Court of Appeal). They are more aggressively determining the content
of their caseload. In the early 80’s, the QC CA had a 4-year backlog. They have shortened that
down to 1 year by throwing out the stinker cases.
 The other trend in QC and ON is case management. This is a move away from 1 size fits all
procedure. It is an attempt to provide rules for each case that are suitable to that case (discussed
in more detail at end of course).
 Rule 77 is a pilot project in ON in case management. It is only being used in OTT and
TOR. If you institute a lawsuit in either of these cities, you have to indicate if it for the
fast track or the standard track. If your case is a case management case, you will have to
appear in front of a case management judge. His role is to participate in settlement
conferences and in procedure conferences. The idea is to get a judge in early to help push
the parties to court or to settle quicker.
 Quebec used to have a strict series of rules on when you can make which kind of motion
in all cases. In 2003, they adopted a new system whereby when you serve your
proceedings on a party, there is an initial presentation date 30 days out. Before that time,
the parties agree to a schedule as to when discoveries will be, what motions will be filed,
when defences will be filed and so on. If they cannot agree to a schedule prior to the
presentation date, they go to court on that date and a judge will set out a schedule based
on their needs. The limitation on the schedule is that the case must be ready for trial 180
days after serving the proceeding on the other party. This development has moved away
from 1-size-fits-all procedures by making parties subject to custom made schedules and it
has also imposed a 6 month delay in getting a case to court. The 6 month delay is
flexible – you can apply for an extension in the last month but you have to justify why
you need more time. The 180 delay is workable in smaller cases but it is not workable
for big cases. A negative aspect of this tool is that you have to create an arbitrary
schedule in a complex case because you cannot apply for the extension right away (you
have to wait until 5 months elapse).
(2) Quality of justice - Rapport du Comité de Revision de la Procédure Civile – Une Nouvelle
Culture Juricaire
 Criticism: Judges are not sufficiently equipped to deal with complex questions that arise.
Judges don’t often know about complex engineering, accounting or technological issues. What
happens is that parties bring in experts who tell conflicting stories about the issue. The judge has
to decide based on these experts.
 In response to these criticisms (access and quality), there has been a shift to arbitration and
mediation.
 Arbitration moves quickly.
 Hamilton says that the comparison is unfair (between litigation and arbitration). Arbitration
tends to be used by sophisticated parties who have the ability to cooperate with each other who
are interested in a cheaper and quicker solution. Litigation, on the other hand, is used by noncooperating parties who are not necessarily looking for a solution – they might want to drag it out
and raise hell for each other. If the parties to arbitration had litigated, it is possible that their
litigations would have been quicker because the relationships are less hostile.
C. The Rise of Arbitration
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 Quebec, Ontario legislatures have rendered arbitration more accessible, because more people
are using it. It goes so far as to be an encouragement to arbitrate.
QUEBEC
 In 1966, there was a substantial reform of the CCP. Prior to this, the CCP provided for
submissions to arbitration, but not undertakings to arbitrate.
o Submission: agreement between parties to submit current dispute to arbitration.
o Undertaking: agreement that if dispute arises in future, we will undertake to
arbitrate.
 Courts interpreted undertaking clauses as void, not existing in Civil Law as they were
considered contrary to public policy.
 Prior to 1966, there were limited rules on procedure, and they were optional. Ex: you could
only receive an award after homologation (asking the court to declare the award enforceable).
 When CCP was amended in 1966, art. 951 was enacted: An undertaking must be set out in
writing. Once dispute arises, must submit to arbitration.
o So undertakings enforceable. Mechanism set out.
 15 years later, Courts were still hesitant about undertakings. But in Zodiak, SCC held that
undertakings were valid and enforceable.
Zodiak International Productions Inc. v. The Polish People’s Republic [1983], Civil Law, p. 33
Facts:
A Polish business gave the appellant an exclusive mandate to distribute Polish films in Canada.
Appellant alleges a breach of the exclusivity clause and an unauthorized rescission of the contract
and, in accordance with the undertaking to arbitrate contained in the contract, applies to a Court
of Arbitration in Warsaw for compensation.
Issue:
Is a complete undertaking to arbitrate valid?
Held:
The mere presence of an undertaking to arbitrate suffices to bar the appellant’s action in court.
Ratio:
A complete undertaking to arbitrate is that by which the parties undertake in advance to submit
to arbitration any disputes which may arise regarding their contract, and which specifies that the
award made will be final and binding on the parties.
An undertaking can be contrasted with a “pre-judicial” or “condition precedent” arbitration
clause, which requires the parties to submit their dispute to arbitration, but does not preclude an
action in ordinary courts of law once the arbitration is completed.
Also, it can be contrasted with a submission which is defined as an act by which persons, in order
to prevent or to put an end to a lawsuit, agree to abide by the decisions of one or more arbitrators
whom they agree upon.
So, a submission applies only to existing disputes which an undertaking extends to future
disputes.
Under the 1897 CCP (before the 1966 revision), a complete undertaking to arbitrate was invalid
as it was considered to violate public policy.
The 1966 revision brought about CCP 951 which provided “an undertaking to arbitrate must
be set out in writing” and “when the dispute contemplated has arisen, the parties must execute a
submission. If one of them refuses, and does not appoint an arbitrator, a judge of the court having
jurisdiction makes such appointment and states the objects in dispute, unless the agreement itself
11
otherwise provides. This provision is proof of a recognition of the validity of the complete
undertaking to arbitrate in Quebec Law.
Art. 951 for the first time gives statutory recognition to an undertaking to arbitrate, and as far as
the pre-judicial undertaking to arbitrate is concerned, no legislation was needed to recognize its
validity.
 In 1986, provisions were added to the CCLC (now 2638-2643 CCQ):
o 2638 CCQ: An arbitration agreement is a contract by which the parties undertake
to submit a present or future dispute to the decision of one or more arbitrators, to
the exclusion of the courts.
o 2639 CCQ: Disputes over the status and capacity of persons, family matters or
other matters of public order may not be submitted to arbitration.
 At same time, arts. 940-951.2 amended in CCP. Detailed provisions about how arbitration is
to work – this is essentially a code of arbitration:
o Can opt out of most rules, other than public order provisions.
o Don’t have to negotiate how arbitration is to work. Can just refer to CCP and
adopt those rules. Makes it easier for parties to negotiate arbitration agreement.
 In 1994, when CCQ came into force, jurisdiction of courts clarified. 3148 sub 2 CCQ:
However, a Québec authority has no jurisdiction where the parties, by agreement, have chosen to
submit all existing or future disputes between themselves relating to a specified legal relationship
to a foreign authority or to an arbitrator, unless the defendant submits to the jurisdiction of the
Québec authority.
 Art. 814.3 CCP: Mediation required in family matters - No application that involves the
interests of the parties and the interests of thier children may be heard by the court if there is a
dispute b/w the parties regarding child cusotdy, support to a party or to the children, the family
patrimony or other patrimonial rights arising from the marriage or civil union, unless the parties
havee attended an information session on the mediation process and a copy of the mediator’s
report has been filed.
** All these steps show that the legislature is making it easier for parties to resolve disputes other
than through litigation.
ONTARIO
 Similar pattern as Quebec.
 Prior to 1991, existence of arbitration clause did not preclude parties from suing each other in
civil courts.
 By Arbitration Act, judge had power to stay proceedings and force arbitration OR to hear
matter.
 In 1991, Arbitration Act was amended. Section 7(1): Judge shall stay civil proceedings
unless (5 exceptions – 7(2) – see Kanitz):
 In 1991, legislature also adopted detailed rules about operation of arbitration. Again, can opt
out.
 At beginning of 1991, Pilot project (R. 24.1): In newly filed civil matters, must go to
mediation before trial. Now permanent part of law in Ottawa and Toronto. Will become rule
across Ontario.
Kanitz et al. v. Rogers Cable Inc. [2002], Common Law, p. 36,
Facts:
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The user agreement b/w Rogers and subscribers provided that Rogers could amend the agreement
at any time by posting notice of such changes on its web site and that continued use of the service
following notice meant the subscriber agreed to the changes.
Rogers amended the user agreement to add an arbitration clause that provided that any claim or
dispute would be referred to and determined by arbitration, to the exclusion of the courts, and that
the subscribers waived any right to commence a class action against Rogers.
Issues:
1. Whether there is, in fact an arbitration agreement within the meaning of s. 1 of the
Arbitration Act.
2. If there is an arbitration agreement, is that agreement invalid or unenforceable because it is
unconscionable;
Held:
1. Yes.
2. No.
Ratio:
Is it an arbitration agreement?
s. 1 Arbitration Act defines arbitration as an agreement by which two or more persons agree to
submit to arbitration a dispute that has arisen or may arise between them.
Concludes there was adequate notice given to customers of the changes to the user agreement and
consequently finds that there is an arbitration agreement between the parties.
The consequence of finding this is that there is a mandatory stay of any action by virtue of s. 7(1)
of the Arbitration Act: if a party to an arbitration agreement commences a proceeding in
respect of a matter to be submitted to arbitration under the agreement, the court in which
the proceeding is commenced shall, on the motion of another party to the arbitration
agreement stay the proceedings.
Notes that the only exception to a mandatory stay in s. 7(1) are contained in s. 7(2) of the Act: A
court may refuse to stay the proceeding in any of the following cases:
1. a party entered into the arbitration agreement while under a legal incapacity.
2. the arbitration agreement is invalid.
3. the subject-matter of the dispute isn’t capable of being the subject of arbitration under
Ontario law.
4. the motion was brought with undue delay.
5. the matter is a proper one for default or summary judgment.
Is it invalid for being unconscionable?
When looking for unconscionability we look for: (1) an inequality in bargaining power; (2)
some taking advantage of, or preying upon the weaker party by the stronger party; and (3) a
resulting improvident agreement – it is not sufficient to simply show that one party extracted a
better deal than the other.
Here, the first element is met (since it’s a contract of adhesion).
In terms of the second element, the mere act of inserting an arbitration provision in a consumer
contract does not inevitably lead to the conclusion that one party preyed upon the other – here
Rogers did not.
With respect to the third element, the plaintiffs tried to claim that the agreement was
improvident since no customer would pursue arbitration for the amounts that are involved here on
an individual basis (which they would have to do since there is no such thing as class action
arbitration). Court does not accept the argument noting that the expense of the arbitration cannot
13
be an excuse here since (a) they don’t know the expense; and (b) it is possible to negotiate so that
the losing party pays all expenses of the arbitration.
Main Point: Courts uphold all kinds of arbitration clauses.
 Why have legislatures favoured ADR?
1. Public demand
 There are problems with litigation: cost, delay. People are critical of the
litigation system and they simply want to arbitrate – they think it is better for them.
If people want to arbitrate, why not let them?
 There is increased demand in particular in multi-jurisdictional cases, particularly
international context. It allows parties to determine a mutually convenient (neutral)
jurisdiction for any arbitration and choose a neutral arbitrator (in terms of national
origin). Ex: A Quebec and Mexican company will agree to arbitrate in NYC. Both
parties have travel expenses and the location is neutral. The increase in cross-border
transactions has increased the use of arbitration.
2. Costs
 Litigation is state-subsidized, but parties still incur costs.
 Arbitration costs gov’t nothing, so it is in the state’s interest for people to
arbitrate.
3. International pressures
 International, multi-jurisdictional Ks.
 Canada adhered to UN Convention on the Recognition & Enforcement of
Arbitration Awards in 1986 (see Foreign Arbitral Awards Act). All provinces
followed suit (see arts. 948-951.2 CCP).
 In 1985, UN Commission on International Trade adopted the Model Law on
International Commercial Arbitration. This has been incorporated by reference at the
federal level (Commercial Arbitration Act). In Quebec, art. 940 CCP ff are based
largely on UN Model Law (art. 940.6 CCP makes explicit reference). Ontario
adopted UN Model Law in the International Commercial Arbitration Act.
 In 1986 and 1987, BC and Quebec respectively opened international arbitration
centers. This may be why UN Model Law was followed and Convention adopted:
there is monetary interest. If foreign parties arbitrate in Quebec and Victoria, money
comes into Canada (Tourism and employment of arbotrators).
D. The advantages and disadvantages of arbitration
Teplitsky and Low
 Remember the 3 criticisms of litigation: 1) cost; 2) delay; 3) expertise
1) Cost
 One a per hour basis, arbitration is more expensive than litigation. The Plaintiff and
Defendant are jointly paying for arbitrator(s), room rental, equipment, arbitrator assistants – all
aspects which would be paid by the state in litigations.
 On the other hand, arbitration takes less time than litigation so on cost: Undetermined.
2) Delay
 Litigation is slow for 3 reasons:
1. Pre-trial procedures. These are detailed and time consuming.
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2. Waiting for a judge – judicial backlog.
3. Appeal process.
 With arbitration, you can reduce pre-trial delays because the parties can adopt whatever
shortcuts they deem appropriate (no motions, limiting discovery…). Whether it is appropriate to
limit pre-trial procedures is another question (it may lead to surprises).
 The backlog delays are avoided altogether. The hearing takes place whenever you want.
 The appeals process is basically not available in arbitration. Sometimes, parties provide for
an appeals process.
 Arbitration clearly saves time.
3) Expertise
 Judges are highly unlikely to be experts in a technical field. Parties can select an arbitrator
with expertise in that area.
 What is gained in technical expertise is lost in judicial expertise.
 Keep in mind that judge is expert at running a courtroom, making a decision (all-or-nothing
solution) whereas an arbitrator may try to split the difference.
 Arbitration is a business. Arbitrators may not want to be seen as coming down too hard on
employers, or another category.
** Bottom line: There are clearly situations where arbitration is appropriate and preferable to
litigation. But it is not a cure all for all problems with litigation. Also, still need fallback:
litigation system.
III. The Economics of Litigation
 5 topics:
1. Costs to use court system.
1 & 2 are litigant costs.
2. Lawyer fees.
3. Court costs (“with costs”).
3 & 4 are recovery costs.
4. Successful Defendant suing unsuccessful Plaintiff.
5. Arbitration costs.
A. Costs Charged by the Courts
 System is state-subsidized, but there are amounts that litigants must pay to use system.
QUEBEC
 Fees are governed by the Tariff of Court Fees. Amount charged depends on amount at issue,
and whether litigant is natural person or legal person (legal person pays roughly 20% more).
These amounts are indexed to inflation. See p.48.
 The plaintiff must pay a fee (1st row of chart to start the suit).
 The defendant must pay a fee to file a defence.
 The fees are indexed to inflation and are adjusted every year.
 They vary with the size of the value of the litigation and whether the party is a legal or natural
person.
 In exchange for the payment of these 2 amounts, parties get unlimited use of the courthouse –
no matter how long or complex the trial.
 The Court charges are very insignificant compared to lawyers’ fees but the government is
trying to increase these costs to get more money.
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 Small claims court fees work in the same way.
ONTARIO
 Fees established under Administration of Justice Act (p.50).
 There is no distinction between legal and physical persons nor is there any difference in fees
based on the amount sought in the litigation. The plaintiff must pay (S.1.i) $157 and the
defendant must pay (s.3.ii) $125. The parties must also pay (S.3.ix) $293 for a trial record.
 The small claims court fees (p.53-55) are set out in the chart. In ON, it costs more to sue in
small claims court if you are a frequent claimant (>10 claims/year) than an infrequent claimant.
B. Lawyers’ Fees
 This is the costliest part of litigation.
 The lawyer-client relationship is essentially contractual so the parties can agree on
remuneration upon any basis. In most cases, however, costs are not negotiated and discussed
when the relationship is established. Usually, it is an implied contract or a usage.
 Historically, lawyers charged a fee based on their assessment of value of services (time, result
achieved, % of value of negotiated contract).
 At some point, lawyers started to keep track of time not as a billing matter but to know value
of service.
 Now, the principal basis of lawyers’ fees is the amount of time spent (adjustments can be
made for success or failure).
 Courts will imply that payment was to be done on hourly basis.
 In addition to the contractual element of the relationship there is an overriding legal and
ethical obligation on the lawyer:
o Arts. 3.08.01 and 3.08.02 Ethics Code for QC Lawyers (p.59): Fees charged by a
lawyer must be fair and reasonable – examples are given.
Code of Ethics of Advocates (Quebec) 3.08.02:
The fees are fair and reasonable if they are warranted by the circumstances and correspond to the
services rendered., In determining his fees, the advocate must in particular take the following
factors into account:
(a)
His experience;
(b)
The time devoted to the matter;
(c)
The difficulty of the question involved;
(d)
The importance of the matter;
(e)
The responsibility assumed;
(f)
The performance of unusual services or services requiring exceptional competence
or celerity;
(g)
The result obtained; and
(h)
The judicial and extrajudicial fees fixed in the tariffs.
o
Rule 2.08(1) of the Code of Professional Conduct of ON says that a lawyer shall
not charge for any service unless it is fair and reasonable and has been disclosed
in a timely fashion.
QUEBEC
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 A fee dispute can come up in different ways. In Quebec, an unpaid lawyer has a right to sue
his client. In such circumstances, the court will have to apply the ethical standard of what is
reasonable.
 If there is fee dispute, ask:
1. What was agreement?
2. Is that fair and reasonable in circumstances? If not, court will strike it down.
 Fee dispute can be argued in 2 different forms:
1. Lawyer can sue
 This is regular civil law suit. Court will look at the Contract and the notion of
“fair and reasonable”.
A c. B. [1983], Civil Law, p. 57
Facts:
A lawyer represented the wife in divorce proceedings and billed her a total of $11,631 for his
services.
Her account payments amounted to $2,160 and the action was for recovery of a balance of
$8,556.
The defendant had believed that she had been overcharged.
Issue:
Is the lawyer entitled to his fee?
Held:
Action allowed in part – defendant only liable to pay $4,596
Ratio:
It was the plaintiff’s duty to keep his client informed as to what the fees to expect either by
interim statement or in some other way.
In this case, six months after the expiry of the mandate the client received a bill for $8,500, this
being the first itemized bill sent in the course of two years.
The Court finds that the parties agreed to pay the lawyer by the hour but then, the judge applied
the “what is reasonable standard from 3.08.02. This rule enumerates factors to be taken into
account – they main 2 are time and experience but other factors are the difficulty of the matter,
the importance of the matter, the result…
The lawyer with 30 years of experience, paid by the hour, was entitled to a $100 per hour fee, yet
it appeared that they had charged an exorbitant time for some of the transactions. The amount of
hours billed was reduced
The lawyer with 2 years experience had his hourly rate reduced from $50 to $20.
2. Client can complain to Bar.
 Bar will appoint committee of 3 lawyers to assess proper amount (arbitration).
Lawyers’ right to sue is suspended.
 Clients are very successful at these proceedings.
ONTARIO
 Under Solicitor’s Act, either lawyer or client can ask that bill be assessed by the assessment
officer.
 Lawyer also has right to sue, but he can just go to the officer to force payment.
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Re Solicitors [1972], Common Law, p. 61
Facts:
Lawyers settled a matrimonial matter for their client in a short period of time.
The settlement was for $500,000 and the lawyers had billed about $2,000 worth of time but billed
the client for $24,000 which they based on the result they achieved.
Issue:
Was the bill excessive?
Held:
Yes.
Ratio:
Court looks at 8 factors (similar to those above). Notes that these factors must be considered in
every case but that some are more important than others in certain situations.
1. Time expended: I do not think the solicitors are entitled to charge the same fee in this case as
they would have been able to do if the time expenditure had been twice what it was and all
other considerations remained the same. Further, he is not convinced that the short amount of
time it took to settle this case was due to the expertise of the lawyers.
2. Legal complexity: nothing legally complex about this file.
3. Degree of responsibility: they assumed all the responsibility that solicitors normally assume
but it does not go much beyond that.
4. Monetary value of the matters at issue: $500,000 is a substantial sum but it is not as
uncommon a sum as was the case a few years ago.
5. The importance of the matter to the client: this matter was important to the client however,
it was of no greater in importance than to any other wife in a similar position.
6. The degree of skill and competence demonstrated: they demonstrated all the skill and
competence required to fully discharge their duty to their client on a high professional level.
7. The results achieved: these results were satisfactory to the client.
8. The ability to pay: court notes that this should only be used a limiting factor, not an
expansionary force.
 Average cost of litigation in 1990s: $38 000 – most of which is paid to lawyers.
 Clients have started to insist that billing be done on some basis other than time – some clients
insist on fixed fees. Ex: I’ll pay you $10 000 no matter how much time you spend. Another
option is to insist on a cap on total billing. Clients will negotiate lower hourly rates. Some
clients will limit the amount of hours that will be paid for. Clients ask for a budget (estimate) so
costs don’t skyrocket too fast.
 Most clients have little understanding of what lawyer is doing. Like giving a blank check.
Alexander v. McKenzie [1984], Common Law, p. 64
A lawyer sued a client to recover fees in BC (no assessment process). The Court concluded that the
contract provided for hourly pay to the lawyers but found that a budget given to the client was that he
would take about 10 hours of work at $65 plus $600 per full day court appearance and other disbursements.
At the end of the day, the lawyer billed for 37 hours plus court appearances over and above what had been
originally been anticipated. The lawyer had never told the client that he got over 10 hours. The court held
the lawyer to be bound to his budget. If the lawyer advised that his estimates were wrong, the client would
at least be able to make a choice. The lawyer should make it clear that his estimate was only an estimate
and that it could be exceeded.
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 If client withdraws mandate, could probably collect full amount of budget.
Alternatives to hourly fees: 1) Contingency fees; 2) Legal Aid; 3) Legal Insurance; 4) Legal
Assistance
1) Contingency fees
 Fee which is dependent on the success of the lawyer’s work. There are a wide variety of such
fees.
 E.g., % of recovery. Effect of this is to transfer risk to lawyer. Client will never end up out
of pocket. If lawyer is successful, amount lawyer receives will be > than what he would have
received on hourly basis.
 Other types of contingency fees:
1. Billing on interim basis on reduced hourly rate + % of recovery.
2. 2/3 of hourly rate + additional 2/3 (total 4/3) if case successful.
QUEBEC
 Contingency fees were expressly recognized and regulated by the Tarif de certains
honoraires extrajudiciaires des avocats (Tariffs of Certain Extra Judicial Fees of Advocates), pg.
65.
o Contingency fee agreement must be in writing.
o Maximum amount = 30%.
o Client had to be liable for any disbursements.
 This regulation is no longer in force: it’s open season, although it still must be fair and
reasonable. 30% may reflect what is fair and reasonable.
 Faribault (pg. 66) argues that a contingency fee agreement is illegal because it is the
acquisition by a lawyer of litigious right, contrary to art. 1783 CCQ.
 Hamilton disagrees with Faribault, who argues that CF agreements are equivalent to the
purchase of a share of a litigious right. It is not the sale of a part of the litigious right but rather, it
is an agreement as to the calculation of the fee. The lawyer does not become the owner of the
right of action – the lawyer does not direct the suit as though his rights were at stake. The client
still directs the litigation. The lawyer doesn’t have right to settle 1/3 of claim independently. The
lawyer remains a mandatary, and the client remains owner of the lawsuit. It is simply a
calculation of fees.
 Contingency fees lead to real conflicts of interest – if a settlement offer is not good enough
for the client but good enough for the lawyer – it’s a problem. If after the lawyer files the suit,
the defendant offers a quick “go away” settlement, the lawyer may want to go for the quick strike.
 Thus, it is valid under Quebec law. 30% is regarded as fair and reasonable.
COMMON LAW
 In ON, and at common law, there are notions of champerty and maintenance. Maintenance
refers to encourage or help somebody to sue if you have no valid legal interest in the dispute. If I
sue Hamilton’s arch enemy and he decides to help me for that reason alone, that is maintenance.
Champerty is an agreement whereby the person maintaining the party to the dispute receives a
share of the proceeds. Champerty and maintenance are both torts. These notions were always
interpreted to bar contingency fees. With the exception of ON, all Canadian Common Law
provinces found that contingency fee agreements ought to be accepted so legislated around the
common law torts of champerty and maintenance. In ON, S.1 of the Champerty act (an old law)
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renders “champertous” agreements invalid. This act has been interpreted as banning contingency
fees.
ONTARIO
 Ontario continues to prohibit them (s. 28 Solicitors Act, Act Respecting Champerty).
 When Ontario adopted Class Proceedings Act (class action), it carved out exception.
Contingency fees are allowed in this context. S. 33 Class Proceedings Act (pg. 69-70): “Despite
the Solicitor's Act and an Act Respecting Champerty, a solicitor and a representative party may
enter into a written agreement providing for payment of fees only in the event of success in a
class proceeding.” Must be in writing, must be approved by court.
 In class proceedings, can have traditional contingency fee. There is also new type (see s. 33):
Multiplier of Base Fee. Base fee = lawyer’s standard hourly fee (hours x rate). If action is
unsuccessful, lawyer gets nothing. If it is successful, lawyer gets base fee multiplied by a
multiplier to be fixed by court. Multiplier will reflect risk lawyer took on in undertaking and
proceeding with case on this basis.
Gagne v. Silcorp Ltd. [1998], Common Law, p. 67
Facts: This was a class action for the wrongful dismissal of 65 employees. The case was settled
3 weeks after the action was settled. $2 000 000 was paid out to the 65 employees. The base fee
was $109 000. The lawyer applied to the court to apply a multiplier of 3 so he would get $327
000 (approx. 15%).
Held: The Court analyzes the purposes of this legislation and how it works. The objective is the
provision of more access to justice to people who couldn’t afford to sue otherwise or for cases
where it doesn’t make sense for one client to sue. The provision of contingency fees is important
for the attainment of the objective of increased access to justice. The contingency fee convinces
the lawyer to take the class action – it is at the heart of the scheme to permit greater access to
justice. A higher contingency fee is there to compensate the lawyer for the risk that he would
have not gotten paid. In order to determine the risk, you have to look at what are the chances that
the class action wouldn’t certify and what the odds were that he wouldn’t succeed on the merits.
The Court said that 65 is a small class and the risk is high. The Court said that the claim had
merit so there wasn’t much risk there. The Court also looked at the speedy settlement positively
(success factors). The Court also said that they must test the reasonableness of the multiplier
sought (S.33(7)(b)). They can’t give the lawyer too much money. They said that the multiplier
should be between 1 (base fee only for slam dunk cases) and 3 or 4. You will never get more
than 3 or 4 times your base fee. The fee needs to be high enough to create a good incentive but
not too much if there wasn’t too much risk. In this case, the multiplier was 2.
POINT: things to consider in contingency cases in Ontario: (1) risk; (2) success factors; (3)
whether a given multiplier is fair and reasonable.
Notes:
 Range has thus far been from 1.5 to 2.9.
McIntyre Estate v. Ontario [2002], Common Law, p. 73
Facts:
McIntyre began smoking at the age of 16 and died of lung cancer in 1999.
McIntyre's Estate commenced a wrongful death action against Imperial Tobacco and Venturi Inc.
The Estate applied for a declaration that a proposed contingency agreement with its lawyers was
not prohibited.
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Under the agreement, the Estate would be required to pay the law firm 33 per cent of
compensatory damages, 40 percent of punitive, aggravated and exemplary damages, costs
recovered in the action and any unrecovered disbursements.
Issue:
Are lawyers and their clients prohibited from entering into contingency fee agreements in
Ontario?
Held:
No.
Ratio:
The courts have made clear that a person’s motive is a proper consideration and indeed,
determinative of the question whether conduct or an arrangement constitutes maintenance or
champerty. It is only when a person ahs an improper motive which motive may include, but is not
limited to “officious intermeddling” or “stirring up strife” that a person will be found to be a
maintainer.
The historic rationale for the absolute prohibition against contingency fee agreements was no
longer justified.
The basic regulatory framework necessary to address potential abuses in the use of such
agreements was already in place in Ontario.
POINT: Contingency fees are valid even in civil suits in Ontario.
 The CA basically invited the legislature to step in and legislate.
 This is a new development – looking at motive and the fairness of the fee in determining the
validity of contingency fees. This is a pretty big change of the law. The legislature has not
stepped in to respond yet but the LSUC’s position is that the bar against contingency fees should
be lifted.
 Contingency fee agreements play a role in providing access to justice. In Gagne, plaintiffs
recovered $30 000 each. In absence of the contingency fee, these people would not have
proceeded.
 Class actions are also more efficient, have one judge hearing case instead of 65.
 Governments like them because they improve access to justice at no cost to the government.
 Contingency fee agreements also raise a number of concerns – Hutchison, p.72, Makin, p.87:
1. Can promote frivolous litigation (more a US concern). A lawyer may be tempted to take
10 cases on this basis, because if 1 or 2 can be settled, potential huge upside to lawyers.
Especially true in class action suits, because suing for a lot more money.
2. Encourages lawyers to engage in ambulance chasing. Race among lawyers to get actions
filed. In classified section of paper, will find ads.
3. Raises ethical issues. Puts lawyer in delicate position vis-à-vis client. What if a
settlement offer comes in early, and lawyer has not invested much time? Lawyer wants
to grab settlement, client may want to wait things out. Thus, lawyer’s personal interest
conflicts with client’s interest.
4. What if there is a real disagreement between lawyer and client, and client wants to fire
lawyer? How much should lawyer get?
Jakab v. Sauer, Mogan, De Jager & Volkenant [1997], Common Law, p. 88
In this case, the lawyer quit because he found out he was mislead by his clients and then he sued for fees.
The 1st issue was whether the lawyer was entitled to anything because it was a contingency agreement and
the suit was pending. The other issue is how you would calculate it? The BCSC concluded that the lawyer
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is entitled to be paid and it is not the lawyer’s fault that a judgment has not yet been rendered. The Court
said that the lawyer is entitled to be paid on the basis of the value of the services he rendered (hourly
billing).
2) Legal Aid
 Under Legal Aid, a litigant who cannot afford legal services is either assigned a state lawyer
or the state pays for a private lawyer.
 Only the ultra-poor qualify.
 Resources have been frozen for many years and the system doesn’t work as well as it should.
3) Legal Insurance
 Been around since 1960s in Canada. In Quebec, introduced in 1993.
 Offered as an option under a homeowner’s premium. For an additional premium, insurance
company will cover 100% of legal fees that might be incurred in following year with respect to
certain types of litigation. Covers only unforeseen litigation.
 Estimates: 30% of Quebecois have it or 125 000 have it.
 Generally, has not worked in Canada.
4) Legal Assistance
 A monthly or yearly payment is made by member, and in exchange receive reduced hourly
rates for certain types of legal services.
C. Costs Awarded to a Party
 Must pay state for using court system, must pay lawyer. On the other side, if you are
successful, will get some back from other side.
 General rule in Canada: Losing party typically will be ordered to pay costs as part of a
judgment.
 In other jurisdictions (i.e. USA), historically there is no concept of court costs. So under
contingency fee agreement, there is absolutely no risk of being out of pocket. Won’t pay lawyer,
won’t pay other side.
 In Canada, even with contingency fee agreement, will have to pay other side for dragging
them to court unnecessarily. That is why we are less litigious society than US.
QUEBEC
 In Quebec, general rule in article 477 CCP: Losing party must pay all costs. This is
discretionary, court can hold that each party pays its own costs. In some cases, successful party
may have to pay losing party court costs.
CCP 477
The losing party must pay all costs, including the costs of the stenographer,
unless by decision giving reasons the court reduces or compensates them, or
orders otherwise.
As well, the court may, by a decision giving reasons, reduce the costs relating to
experts’ appraisals requrested by the parties, particularly if, in the opinion of the
court, there was no need for the appraisal, the costs are unreasonabel or a single
expert’s appraisal would have been sufficient.
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In a personal action, and subject to article 988, the amount of the costs of suit,
except costs of execution, that the defendant who loses may be required to pay
shall not exceed the amount of the condemnation, if that is not greater than the
amount contemplated in paragraph a of article 953, unless the court, by
judgement giving reasons, orders otherwise
 The general rule is that the losing party pays but the Court can do otherwise – ex: in a family
law dispute, the court will let the losing weak party off the hook.
 If one party undertook tactics to unnecessarily stretch things out, he may be ordered to pay
costs. This is rare.
 Court costs are paid to the lawyer, not to the party. Defendant must make payment to lawyer,
not to plaintiff and the lawyer pays the plaintiff.
 2 components to court costs:
1. Amount plaintiff had to pay for court stamp, to have case inscribed. This is small #.
2. Contribution towards legal fees.
 In Quebec, there is Tariff of Judicial Fees of Advocates (p.95). The tariff divides cases
according to the amount at issue. The tariff takes each step at legal proceeding, and arbitrarily
assigns a value to that step.
 S.25: Principal amount for judgment on the merits varies from $75 where amount is <$300 to
$1,000 where amount is >$50,000.
 S.26: Fee for every contested incidental proceeding ($10 - $50 – more if the proceeding ends
the dispute).
 s. 27: for examination of a party before or after a plea filed with the exclusion of an
examination held during an incidental measure or a trial ($10 - $30).
 s. 33: where a case lasts more than one day, for each additional half a day ($25 - $50).
 Typically, courts costs are in range of $1500 to $2000.
 There are two items that make costs substantial:
1. S.15 of the tariff says that the Court may grant a special fee in addition to all other fees in
an important case. Viel: S.15 is not intended to be punitive. It doesn’t matter if the
defendant acted unreasonably – what matters is the novelty and difficulty of the issue.
2. Additional fee (s. 42 Tariff). Provides for additional fee equivalent to 1% of amount of
judgment over $100 000 shall be taxable. So, say you have a $1,000,000 suit, in addition
to the court fees ($1,000 - $2,500), you get charged 1% of $900,000.
o 1% in Quebec is automatic. Court in theory can order that it not form part of
costs.
 The costs system in Quebec is a bit arbitrary – it provides little compensation and incentive.
You will not recover the overwhelming majority of what you paid for your lawyers. On the other
hand, the 1% overcompensates successful parties in some cases (ex: dismissing a $1 000 000 suit
on the 1st motion).
ONTARIO
 Hamilton prefers ON’s system.
 Governed by s. 131 of Courts of Justice Act: Court costs are at the discretion of the tribunal
(how much and to whom).
 Rule 57 in Rules of Civil Procedure sets out principles involved in exercising discretion.
Rule 57.01 lists factors to be considered.
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57.01 (1) In exercising its discretion under section 131 of the Courts of Justice Act to award
costs, the court may consider, in addition to the result in the proceeding and any offer to settle or
to contribute made in writing
(a)
the amount claimed and the amount recovered in the proceeding;
(b)
the apportionment of liability;
(c)
the complexity of the proceeding;
(d)
the importance of the issues;
(e)
the conduct of any party that tended to shorten or to lengthen unnecessarily the
duration of the proceeding;
(f)
whether any step in the proceeding was,
i.
i. improper, vexatious or unnecessary, or
ii.
ii. taken through negligence, mistake or excessive caution;
(g)
a party's denial of or refusal to admit anything that should have been admitted;
(h)
whether it is appropriate to award any costs or more than one set of costs where a party,
i.
i. commenced separate proceedings for claims that should have been made in one
proceeding, or
ii.
ii. in defending a proceeding separated unnecessarily from another party in the
same interest or defended by a different solicitor; and
(i)
any other matter relevant to the question of costs.
(2) The fact that a party is successful in a proceeding or a step in a proceeding does not prevent
the court from awarding costs against the party in a proper case.
 Settlement offers: If settlement if offered and declined, and outcome of litigation is less
favourable than settlement, then party who declined settlement must pay other party’s court costs
for period after settlement offer was made.
o E.g., A sues B for $100 000. B offers $60 000 to settle law suit. A says no. A is
eventually awarded $50 000 in judgment. A must pay B’s courts costs for period
after which settlement offer was made.
o This encourages defendants to make serious settlement offers and encourages
plaintiffs to accept serious offers.
 In Ontario, there are 2 scales for court costs. There is a partial indemnity scale (party and
party costs) and substantial indemnity (solicitor and client costs).
 Partial indemnity is general rule. Based on Tariff A (costs grid) found in the annex to the
Rules of Practice. Tariff is much closer to reality than in Quebec. Maximum hourly basis is
$225/hour (lawyer with <10 years experience), $300/hour (10-20 years), $350/hour (> 20 years).
There is also $2300/day of trial. A party can actually recover between ½ and 2/3 of what he spent
on lawyer. Probably more outside Toronto.
 Substantial indemnity is exception. There is punitive element here, attempt to punish one of
litigants because of misconduct in way litigation was carried out (e.g., big litigant drags trial out).
There may also be misconduct in facts giving rise to litigation (e.g., in employment matter, if
employee was fired in particularly brutal way). Sub. ind. is intended to provide full
compensation. It is at least 30% higher than partial indemnity, but can be as much as double $450 for lawyer with > 20 years experience. $4000 a day for trial.
24
Young v. Young, 1993 – SCC, p.99
Solicitor-client costs are only given where there is outrageous or scandalous conduct by one of
the parties. The court awarded a substantial indemnity for 4 days of the trial and partial
indemnity for the balance of it.
 Hamilton: Ontario costs are calculated on a step by step basis and represent either partial
indemnification (approximately 60%) or substantial indemnification (intended to be 100% of
necessary expenses). An unrepresented party can only recover out of pocket expenses.
 Note, sometimes, the court will just fix costs immediately i.e. without any particular
calculation, just, that day fix the award to a certain amount. This is at the judge’s discretion (s.
131) and is quicker and easier than the other methods of calculation. This method is, however,
less common in longer trials. Typically, this is not done without evidence – the judge will ask for
representations from the parties in order to determine the costs at the end of the trial.
 Court costs do not meet their objective of fully compensating a party in QC – but they coe
much closer in ON.
D. Liability for Instituting Proceedings
 In addition to the net cost of litigation, the party may have spent a lot of time and money on
the litigation as well as damage to reputation along with all sorts of other damages and
inconveniences. Can you recover them?
QUEBEC
 There is recourse for abuse of process, a civil delict.
Gendreau Viel v. Les Entreprises Immobilieres du Terroir Ltd. [2002], Civil Law, p. 101






Here, the court looks at the law of court costs, which is the starting point of the analysis. The
problem in Quebec is that the whole thing is codified i.e. tariffs are set…the only discretion is
provided for in s. 15 of the tarrif and so it is a very mechanical exercise.
S. 15 is the only discretion and is only for special cases – it cannot be punitive.
The result is an inadequacy of court costs that are awarded.
Court then discusses the delict of abuse of right to litigate (para. 75).
Court distinguishes b/w abuse of right to litigate and conduct giving rise to litigation.
In Quebec (unlike in Ontario), the fault is only for abuse of right to litigate and not for an
abuse of conduct giving rise to litigation (i.e. an outrageous behaviour that necessitates
suing). So, you can only recover where the party is abusive during the litigation – ex: You
can get compensation for time and money spent when the party drags out the litigation or
bashes you in the paper.
 Note there is a procedural shortcut for a situation whereby you feel that the claim made is
frivolous. You don’t have to go to court and wait for it to play out to have this assessment made:
75.1 CCP: At any stage of proceedings, the Court, on a motion, may dismiss an action or a
proceeding if the examination held pursuant to this Code shows that the action or proceeding is
25
frivolous or clearly unfounded, on a ground other than those provided in article 165, or if the
party who instituted the action or filed the proceeding refuses to have such examination.
75.2 CCP: If you get it thrown out via 75.1, the court, may, upon application, declare the action
or proceeding excessive or dilatory (delaying). In that case, the court may order the unsuccessful
party to pay damages in compensation for the prejudice suffered by another party if the amount
thereof has been determined.
Example: an employer gives employee 18 warnings and the employee repeats the conduct. The
employer fires the employee and the employee sues for wrongful dismissal. The employee may
use CCP 75.1 to avoid a trial and demonstrate that a trial would be excessive, frivolous…
523, 524 CCP: similar to above but for a Court of Appeal scenario.
ONTARIO
 In Ontario, it is less of an issue since (a) even in a normal case, a successful litigant gets costs
on a partial indemnity basis (1/2 – 2/3 the expense); and (b) if the conduct of another is abusive,
then maybe be entitled to substantial indemnity which provides for essentially a full
compensation.
 Here, the common law tort of abuse of process exists but it is narrow in that you need to show
that the other litigated not to vindicate a right, rather was done to inconvenience you.
 In Ontario, 75.1, 75.2, 523, 524 do not exist.
** If you are defendant, and you defend yourself successfully, most likely never recoup all costs.
This is a cost of doing business.
E. Costs in Arbitration
 Court costs are nominal in litigation as the state pays the bulk of the cost. In arbitration, the
parties pay for everything.
 There are essentially 2 different ways to arbitrate a dispute:
1. Arbitration institutions: Will take you through the process.
2. Hire whomever parties agree as arbitrator.
 For informal, parties have to pay arbitrator’s fees. They are usually retired judges or senior
litigators. Generally $400-500/hour. Generally a panel of three arbitrators. A 10-day arbitration
is >$100 000, just for arbitrator. Also costs for room rental, equipment, etc.
 For arbitration institutions, there is structured fee schedule. Depending on amount at issue,
will charge you certain administrative fees. For $50 000 case, administrative fee is $2000. For
$1 000 000, fee is $14 500. $10 000 000 case is $30 000. Fee for arbitrator, in $50 000, is $2
000-$7 500 per arbitrator.
 In Quebec, fee for court in $1 000 000 case is $1 181. In Ontario, $474. With International
Chamber of Commerce, and panel of three arbitrators, $40 000-$160 000 (see chart on p.104).
 What about lawyer’s fees? There is cost saving here, because process is more streamlined.
Also, don’t have to use lawyer who is member of bar of jurisdiction where arbitration takes place,
so don’t have to bring a new lawyer up to speed. Moreover, no appeal.
 Will the lawyer’s saving offset additional amount for arbitration? Not in most cases.
Arbitration more expensive than litigation. People go to arbitration to save time, and for
judgment that is more acceptable to parties.
26
Court costs in arbitration
 Under Quebec law, arbitrators bound to follow arbitration agreement. If agreement indicates
loser must pay costs, this is binding. Otherwise, it is discretionary.
 In Ontario, under ICC rules, it is discretionary. Typically, arbitrators do not make order for
costs.
IV. The Lawyer
A. Overview of Legal Profession
 Came into existence in middle ages. Court system was becoming more complicated. So
there was a growing need for individuals who understood the system.
 Historically, there has been a division of lawyers on functional grounds. At common law,
solicitor (gives advice) versus barrister (appears at court). In Civil Law, avocat (gives advice)
versus avoue (appears at court). Also have notary in Civil law.
 In litigation, both barristers and solicitors involved. Where matter becomes litigious, solicitor
will hire barrister, but solicitor will do research, interview witnesses, etc. Often, a barrister goes
to court without ever having met client.
 There are attempts to break down distinction in UK. Solicitor can appear at court, but
distinction still exists.
 In France, distinction between avocat and avoue abolished in 1966.
 Distinction never caught on in Canada. There is Law Society of Upper Canada, which is for
solicitors, and Bar for barristers. But when you are called to the Bar, become both at same time.
 In Quebec, only have avocat. Notary’s role is under increasing attack, and will probably soon
seize to exist. Notaries will be invited to join bar.
Organization of legal profession (p.105)
 In England, legal profession has always been self-regulating. Body elected by members of
profession regulates profession. This is historical phenomenon.
 Earliest barristers lived in Inns near courthouses in London. Inns came to take on educational
role in 1350. This role formalized in 1557, when law was adopted which stated that to be
barrister, had to be member of one of Inns of Court.
 Inns had established rules and criteria for admission. Inns also had power to enforce
discipline and to expel someone.
 Administration of Inns was performed by elected members from Inn (i.e., benchers).
 In Quebec and Ontario, gov’t plays role. Not left simply to lawyers, although it actually is to
a substantial degree.
QUEBEC
 Governed by Bar Act, which creates Barreau de Quebec. The Barreau is governed by the
Council, most of whose members are elected by members of the Bar – the others are appointed by
the government.
 The Bar is responsible for professional training (Bar School), for admission to the Bar, for
adoption and enforcement of Code of Ethics, and compulsory insurance.
27
 Government intervention:
1. Elect certain members of General Council
2. Bar and its members governed by Professional Code (pg. 107 CB)
 Aside from the Bar’s code of ethics, all professionals in QC are subject to the
professional code.
 S.3 of the Professional Code creates body (Office des professions du Quebec),
which ensures (s.12) that each professional order (including the Bar) acts in a way to
insure the protection of the public (that there is Code of Ethics, adequate insurance,
etc.)
 When a professional corporation adopts a regulation, it first goes to Office, who
passes it to gov’t with its recommendation as to whether regulation should be passed.
 The Bar ensures arbitration of billing disputes.
 Code also creates Tribunal des Profession, which hears appeals from decisions in
disciplinary matters. Tribunal is made up of three judges from the Court of Quebec
(independent judges)
ONTARIO
 Similar situation in Canada. LSUC is organization. Head is treasurer, governing body is
benchers. Benchers are elected by LSUC.
 LSUC has similar powers in terms of admission, education, discipline, etc.
 Government intervention:
1. Appointment of certain benchers.
2. Some regulations of LSUC are subject to government approval (important matters with
an impact on public).
3. Statutory appeals to Divisional Court (regular court system) for disciplinary matters.
Divisional Court is made up of three judges of Ontario Supreme court (independent
judges).
 In Ontario and Quebec, Code of Ethics is vigorously enforced – lawyers don’t sweep their
colleagues’ misdeeds under the rug.
 S.107(a) of the QC Bar Act gives the bar committee on discipline discretion to discipline
people for any act derogatory to the honour or dignity of the profession even if no actual rule was
broken.
 Pg. 117 CB: Address to law students in Ontario. Describes ways of getting disbarred.
Béliveau v. Committee on Discipline; Syndic [1992] , Civil Law, p. 130
Facts:
 A complaint was made against the appellant, a member of the Quebec Bar.
 The complainant alleged that he had committed 3 acts derogatory to the honour and dignity of
the Bar by having taken advantage of his status as an advocate to borrow or obtain from
clients significant sums of money, thus breaching their trust in violation of s. 107(a) of the
Barreau du Quebec Act.
 s. 107(a) provides that in the absence of a particular provision of this Act or a by-law, the
Committee on Discipline shall decide if the act complained of is derogatory to the
honour or dignity of the Bar or prejudicial to the discipline of its members. This is a catchall provision.
 The appellant said that this provision is too vague, and that it is unfair to not know what’s
derogatory.
28
Issue:
Is s. 107(a) of the Act too vague?
Held:
The provision is not too vague.
Ratio:
 The standard of conduct established by s. 107(a) is intelligible and not so vague and
imprecise that an advocate would be unable to understand its meaning.
 Therefore, there is no violation of s. 7 of the Charter.
POINT: Lawyers must not offend their profession by committing a derogatory act or by doing
something prejudicial to its members. What constitutes one of these acts may be left to the
discretion of the Committee on Discipline.
 2 reasons to believe why Code is enforced:
1. It’s their mandate to do so.
2. Bar recognizes that it has to enforce Code to maintain public confidence. If it fails to
maintain public confidence, gov’t intervention will increase and they don’t want that.
B. The Practice of Law
 Initially, all lawyers practiced individually.
 Practice of barrister is still largely individual. Barristers will share office space and
administrative expenses, but they each have their own clients.
 Other than barrister, most lawyers practice in association with other lawyers. There are many
advantages to this:
1. Allows for specialization, pooling of talents.
2. Take advantage of economies of scale.
3. Junior lawyers put more money in senior partners’ pockets.
4. Cheaper to practice, can share expenses. Have single library, etc.
5. Can establish a trade identity and goodwill.
6. Sharing of profits. At certain times, M&A lawyers busy, bankruptcy lawyers have
nothing to do. At other times, the opposite is true.
 Firms have become huge over time and especially over the last few decades. Firms are
national and multi-national whereas it used to be that a really big firm meant only a few
lawyers in one place. The same reasons that justify practicing in a firm also lead to major
growth – economies of scale, splitting expenses, increased specialization. There is now a
need to be able to handle legal issues in a multi-jurisdictional way. Law firm sizes increase
with the size of transactions. Another issue is that the more juniors there are at the firm, the
more money the partners make.
 The problems associated with large firms are:
o conflicts of interest arise;
o succession becomes a problem;
o sharing profits sometimes becomes problematic.
 In Quebec and Ontario, law firms must take form of partnership. Governed in Ontario by
Partnerships Act, in Quebec by CCQ. Consequences:
1. INTENDED CONSEQUENCE: Each partner has unlimited personal liability for debt of
partnership. In McDonic v. Hetherington (pg. 119 CB), one partner was engaged in
defrauding clients. Court held that other partners were liable, even though they knew
nothing of it. As a firm becomes bigger, this concept becomes less and less relevant.
When there ate 300 partners nationally, one doesn’t keep an eye on the work of the other
29
299 are doing. It doesn’t make sense to make the Toronto litigation partner responsible
for the negligence of the Montreal IP associate.
McDonic v. Hetherington [1997] p. 119
Facts:
 2 sisters entrusted money to a partner of a law firm for investment.
 The investments were improvident and the sisters suffered loss.
 Sisters sued the lawyer and his partners claiming they were negligent and breached their
fiduciary duty to the sisters.
 These partners were unaware of his negligent conduct.
Issue
Should his partners be liable?
Held:
Yes.
Ratio:
 The partners’ liability for Watt’s misconduct turns on the provisions of the Partnership Act
ss. 6, 11 and 12(a).
 Section 6 makes each partner an agent of the other partners in so far as the business of the
partnership is concerned.
Section 11 renders partners liable for a third party’s loss caused by another partner’s
misconduct if that partner was acting either with the partners’ authority or in the ordinary
course of the firm’s business. Liability under s. 11 flows from one partner’s express or
implied authority to act on behalf of the other partners.
 Subsection 12(a) extends the partners’ liability to situations in which the offending partner
does not have express or implied authority to bind the partnership but does have the apparent
authority to act on behalf of the partnership.
 Mr. Watt’s activities were within the scope of his implied authority since they fell within the
ordinary course of the business of the law firm. The fact that a transaction is dealt with in
the books of the firm is strong evidence that it is part of the ordinary course of the business of
the firm. Here, payments were made through the partnership account.
 Notes that the nature of the activity and not the manner in which that activity is
performed will determine whether that activity falls within the scope of the firm’s
ordinary business (i.e. you cannot simply say that our firm encourages honest, and prudent
conduct and because this conduct was imprudent it cannot be seen as conduct within the
ordinary course of business – if that was the case, vicarious liability under s. 11 would be
severely limited).
 In the alternative, even if you don’t find that he acted within the scope of ordinary business, it
could be held that he acted within the scope of his apparent authority. The clients felt they
were dealing with Mr. Watt as a partner of the law firm and so the partners would be liable
under s. 12.
 POINT: Partners may be liable for each other even when they are unaware of the illicit
acts taking place and being conducted by their partners (see LLPs below though).
2. UNINTENDED CONSEQUENCE: Tax consequences. Partnership structure is bad from
a tax perspective as compared to a corporation. You can retain profits in a corporation,
dividends to sh’s are taxed in a special way and corporations are taxed lower. Partnership
30
income is calculated as regular income tax. It is not clear why lawyers are faced with this
extra tax burden.
3. Difficult to manage. In principle, the structure is one partner/one vote. If you want to
expel a partner, unanimity is required. The structure can be changed with a partnership
agreement but the default rules are not easy to work with. As the partnership gets bigger,
the problems become more severe.
 New problems of mega-firms:
1. Financial issues. How do you share profits when costs of living are higher in Vancouver,
but TO brings in more business?
2. Culture differences. Vancouver lawyers go home early on Fridays.
3. Conflict of interests. Client of Montreal firm suing client of Vancouver firm.
4. Ethical issues. Each lawyer is bound by Code of Ethics. But in big firm, there is ethics
committee deciding ethical matter. Is this consistent with notion of individual ethical
responsibility?
5. Problems with bars. Traditionally, all members of law firm were members of local bar.
Had to be residents of province. Names of firms had to be names of current or retired
lawyers. This protected local firms from big firms in Mtl, TO, Vancouver.
i)
Rule that prohibited a partnership between a member of the bar
that is resident & a non-resident (member of the bar or not). E.g.,
Law Society of Alberta v. Black, pg. 124: Unsuccessful attempt by
Law Society of Alberta prohibiting partnerships between resident
and non-resident lawyers and prohibiting dual partnerships.
ii)
It is no longer the case that can't use the name of the firm unless
they are members of the Law Society (passed bars).
iii)
Now have truly national law firms.
 Other structures have appeared:
1. Legal Corporation (BC, Alta).
 Not a true corporation. This is an attempt to give lawyers some of tax benefits, without
affecting unlimited personal liability. Individual lawyer can incorporate, wherein only
shareholder of corporation is lawyer.
 Amendments to Law Society Act to introduce this corporation in Ontario were overturned.
 In Quebec, Professional Code was amended in 2001 to allow for creation of companies to
carry on professions, including practice of law (p.131, s.187.11 ff. of the QC Professional Code).
 2 characteristics:
1. Person making mistake would remain personally liable.
2. Bar would adopt rules to ensure that company had adequate insurance.
 SH: It is typically a one person corporation that is intended to get the tax benefits without the
limited liability. So, a lawyer would create a legal corporation with himself or herself as the sole
shareholder. That corporation would provide legal services or would be the partner in the
partnership that provides legal services. The income would be earned by the corporation and
taxed at corporate rates. It can pay a salary to the lawyer or to his or her spouse and children if
they provide some services to the corporation. It can also pay dividends. If there is a
professional fault, however, the claim lies against the lawyer as if there was no corporation.
2. Limited Liability Partnership.
 LLP: partnership whereby partners enjoy limited liability for some of the partnership’s
liabilities. The objective of the LLP is to shield members of professional partnerships from
vicarious personal liability for malpractice liabilities of the firm.
31
 When a partner is not involved in the negligent conduct, the partner is not liable for the
damages. You can sue the negligent partner and the partnership, but the client who was wronged
cannot sue the non-negligent partners personally.
ONTARIO
 Law Society Act in Ontario allows for LLP. Key feature: Innocent party not liable for debts
or liabilities of negligent partner.
 Can sue negligent partner personally and can sue partnership, but not innocent partner.
 Law Society Act requires compulsory insurance.
 Must include LLP/SRL in partnership name
QUEBEC
 Quebec rules will bring in similar structure. Can’t sue innocent party, and must have
adequate insurance (see p.131).
3. Multidisciplinary Firms.
 A firm in which lawyers are partners with people who are not lawyers. Typically, lawyers
and accountants.
 As rules currently stand, multidisciplinary firms are prohibited in Quebec and Ontario.
 R. 3.05.14 Code de deontologie des avocats (pg. 109): Lawyer cannot share fees with
someone who is not member of Bar. This rule is under attack. Accountants are moving into legal
sphere.
 Arguments to justify prohibition:
1. Privilege. If you are meeting with lawyer and accountant, lose privilege.
2. Independence. Lawyers must be in a position to provide independent advice to clients
and this independent might be shaken in the context of an accounting firm. If the audit
service is more valuable than the legal service, then the lawyer might not feel totally free
to give real advice on a legal matter.
3. Discipline. Bar can only discipline lawyers. Lose power to discipline all of individuals
involved.
4. Commercialization. Lawyers will become more commercial.
 These arguments are not convincing. The reality is that the multidisciplinary firm is coming.
 ON has accepted the concept of the multi-disciplinary firm in by-law 25 of the law society:
 The by-law expresses the lawyer’s real concern: that the accountants will wind up in control
and you will wind up with accountants running law firms. S.4(2) of the by-law sets out the
conditions that must be met for a multi-disciplinary practice. It states that the lawyers must be in
control of the association. The QC Bar’s working group on multi-disciplinary practice expressed
the same concern (p.134).
o
s.3: a member may, in connection with the member’s practice of law, provide to a
client only the services of an individual who is not a member who practices a
profession, trade or occupation that supports or supplements the practice of law.
o
s. 4: a member may enter into a partnership or association that is not a corporation
with an individual who is not a member who practices a profession, trade or
occupation that supports or supplements the practice law for the purpose of
permitting the member to provide to clients the services of the individual.
o
s. 4(2): provides the conditions of entering a partnership with a non-member. Cannot
unless:
1. the individual is qualified to practice a profession, trade or occupation that
supports or supplements the practice of law.
2. In the case of entering into a partnership with the individual, the individual is
of good character.
32
3. The individual agrees with the member in writing that the member shall have
effective control over the individual’s practice of his profession in so far as
the individual practice the profession to provide services to clients of the
partnership or association.
4. The individual agrees with the member in writing that, in partnership with
the member, the individual will not practice his profession except to
provide services to clients of the partnership.
5. The individual agrees with the members in writing that, outside of his
partnership or association with the member, the individual will practice his
profession independently of the partnership and from premises that are not
used by the partnership for its business purpose.
6. The individual agrees with the member in writing that, in respect of the
practice of his profession, the individual will comply with the Act, regs, bylaw, rules of practice and procedure…
7. In the case of entering into a partnership with the individual, the individual
agrees with the member in writing to comply with the Society’s rules,
policies and guidelines on conflicts of interest in relation to clients of the
partnership who are also clients of the individual practicing his profession
independently of the partnership.
50% voting share must belong to a member of the bar. Perhaps other 50% could be anything.
C. Representation
 Who can go to court on behalf of a litigant? 3 propositions:
o
A party has the right in legal proceedings to represent himself (art. 61 CCP and rule
15.01(3)).
o
A lawyer has the right to represent a party (art. 61 CCP, rule 15.01(3)).
o
A party cannot be represented by someone who is not a lawyer.

Quebec
Ontario
Personally
Yes – art. 61
Exceptions – 61, 1049
Yes – r. 15.01(3)
Exc. – 15.01(1), (2), 5.02(1)
By lawyer
Yes – art. 61
Exc – small claims (959)
Yes – 15.01(3)
By non-lawyer No
Exceptions – 959, Sp. Tribs.
No
Exceptions – s.26 C of J act, R.15.01(2), Sp.
Tribs.
1) Personally

Art. 61: No one is required to be represented by attorney (see exceptions from this article
below)
 R. 15.01(3): Any other party to a proceeding may act in person (see exceptions from this
rule below) or be represented by a solicitor.
33
2) By lawyer
 Art. 61: Implication: can be represented by lawyer – if its not required, the implication I that
it is possible.
 R. 15.01(3): May be represented by solicitor (see text above.)
 62 CCP: the right to act as attorney before the courts is reserved exclusively to advocates,
except in the cases set forth in paragraph 7 of section 16 of the Notaries Act.
QUEBEC
 s. 128 Bar Act also provides for exclusivity (p.148).
ONTARIO
 Exclusive right to represent litigants. Not statutory, but common law.
GENERAL
Why do lawyers have this exclusivity?
1. Correct Answer: Nature of process requires this. It is complex process. There are a series of
rules that have been adopted to make sure process works fairly. A person with expertise must act
to ensure rules are respected.
 Judge plays a passive role in this process. We don’t want him to examine witnesses, come up
with legal arguments. Common law system (adversarial system) is different than inquisitorial
system.
 Where an individual acts on his own behalf, judge forced to take on greater role: disallows
questions, finds legal arguments. But this is not how system is supposed to work.
2. Cynical Answer: Lawyers have tremendous political power. There are a large # of lawyers in
office, who contribute to political campaigns, etc. No legislator wants to mess with the Bar. The
Bar is essentially a protection racket.
Exceptions to above propositions
1. There are litigants who are not allowed to represent themselves.
QUEBEC
 Art. 61 CCP: Six exceptions – litigants who must be represented by a lawyer:
a. Corporation. It cannot stand up in court and represent itself. Must be lawyer, because
there are a variety of people who have interests in corporation (i.e., shareholders).
 Atomic Slipper case (p.146): A law suit had been instituted by bank against its
customer and the president and sole shareholder of a corporation who had given
guarantee. By the time case reached SCC, individual was representing himself and
company. SCC stated that when individual stands up, he can speak on his own behalf,
but not on behalf of corporation. So corporation was unrepresented. This is a strict
interpretation of the rule – even a sole proprietor cannot represent his corporation if he is
not a lawyer.
b. Public curator.
c. Trustees, guardians, liquidators, receivers, other reps of collective interests. An
individual acting on behalf of a group of persons.
34
d. Collection agents and purchasers of accounts. Here, there is exception because there are
instances when collection agent is not acting on his/her own account.
e. General or limited partnerships and associations within the meaning of the CCQ.
f. Persons acting on behalf of others. Lawyer can ensure that interests of all litigants are
properly protected.
 Art. 1049 CCP: The representative or member who applies to act as such must be represented
by an attorney. Same theory – To ensure that interests of whole class are represented.
ONTARIO
 R. 15.01(1): A party to a proceeding who is under disability or acts in a representative
capacity shall be represented by a solicitor – when you are not in a position to make your own
decisions. Such a person is not in a position to make his own decisions.
 R. 15.01(2): A party to a proceeding that is a corporation shall be represented by a solicitor
except with leave of the court. A corporate entity with a single shareholder will likely be
authorized to have that shareholder represent. Must satisfy court that he/she is competent to deal
with issues.
 Rule 5.02(1) – joint plaintiffs must have same lawyer: Two or more persons who are
represented by the same solicitor of record may join as plaintiffs or applicants in the same
proceeding where,
(a) they assert, whether jointly, severally or in the alternative, any claims to relief arising
out of the same transaction or occurrence, or series of transactions or occurrences;
(b) a common question of law or fact may arise in the proceeding; or
(c) it appears that their joining in the same proceeding may promote the convenient
administration of justice.
2. Litigant cannot be represented by lawyer.
QUEBEC
Small Claims Court

959 CCP: (small claims court – claims less than $7,000) natural persons must
represent themselves; they may, however give a mandate to their spouse, a relative, a
person connected by marriage or a friend to represent them. The mandate must be
gratuitous and be set out in a signed writing stating the reasons why the person is unable
to represent himself.

959 (cont’d): The State, legal persons, partnerships and associations may only be
represented by an officer or another person bound exclusively to them under a
contract of employment. [Note: if you have a lawyer under a full contract of
employment, he may represent the corporation].

959 (cont’d): Notwithstanding the Charter, no advocate or collection agent may act as
a mandatary. By way of exception, where a case raises a complex legal issue, the judge
may, on his own initiative or at the request of a party and with the consent of the chief
judge of the Court of Quebec, allow the parties to be represented y an advocate.
Here, the fees and costs of the advocates are borne by the Minister of Justice and may
not exceed the fees and costs set out in the tariff of fees prescribed by the Government
under the Legal Aid Act.

35
Notes

General rule: Parties represent themselves unless represented by someone else as a result
of a gratuitous mandate.

A lawyer cannot be the mandatary unless the case raises a complex legal issue, in which
case, he’d be paid by the QC Ministry of Justice (sub-para. 3).

Sub-Para 2: A lawyer can represent a corporation if he is employed by it full time or is an
officer of it
Nissan Automobile Co. v. Pelletier [1978], Civil Law, p. 147
The Bar challenged the constitutional validity of the non-representation clauses concerning small
claims court. In this case the S.C.C. adopted the C.A. reasons and held that the small claims
procedure was not ultra vires.
Held that what is fundamental is that justice be done.
 I am far from being convinced that the representation of parties by counsel may be qualified
as a fundamental right to the point that a provincial Legislature may not depart from it if it is
of the opinion that it may harm sound and expeditious justice as required in certain fields of
its legislative competence, within the terms of the constitution.
 The provisions sought a simplified administration of justice, easily accessible, more rapid
and less costly process, taking into account the purpose of it.
 The Court held that there was a fundamental right to justice, which usually requires a lawyer
but not in this case.
 Note: Art. 959 now has a notwithstanding clause.
Ontario
 There is no ban on lawyers in small claims court.
3) Representation by non-lawyer
QUEBEC
 Until recently, very few circumstances where you could be represented by non-lawyer.
 Exceptions:
1. Art. 955 CCP: Small claims. Can be represented by relative, person connected by marriage, or
friend.
2. Art. 956 CCP: Small claims. Company can be represented by a director, officer or employee.
3. S. 128 Bar Act exceptions where lawyers do not have exclusive right (p.148): labour matters,
rental board, social affairs division of Administrative Tribunal of Quebec. These are tribunals
which are less formal, where member of tribunal is more likely to intervene in process, and where
amounts at issue do not justify substantial fees charged by lawyer.
ONTARIO
 Small claims rules do not exclude lawyers. Limit in small claims is $10 000 (see regulation
on p.36 of vol. II).
 S. 26 Courts of Justice Act: Party may be represented in small claims by counsel or an agent.
But court may exclude agent if person is not competent to represent or does not understand and
comply with duties and responsibilities of advocate.
36
 R. 15.01(2): Ontario court may authorize a corporation to be represented by someone other
than a solicitor. Had the Atomic Slipper litigation taken place in ON, the individual could have
asked for leave and he probably would have gotten it in the circumstances.
 Also similar carve outs as in Quebec (see #3 above).
D. Lawyer-Client Relationship
 Essentially, a contractual relationship. Rights and obs are set out in K.
 If parties negotiate an agreement, they can set out all rights and obligations. But typically,
hiring of lawyer is limited to handshake, with limited discussion about fees. Therefore, you need
to find the implied terms or the relevant CCQ provisions.
 In addition to contractual obligationss, lawyer has ethical obligations imposed by Code of
Ethics which take precedence over his contractual obligations – ex: If the lawyer gives
undertaking to the court in litigation, the court can force the lawyer to respect his undertaking.
Even if the client says don’t do it – you have to. He is also officer of court, and has obligations to
court.
Witten Volgel, Binder & Lyons v. Leung, 1983, pg. 185
Lawyers were ordered to comply with certain undertakings that were contrary to their clients’
requests.
QUEBEC
 Under CCQ, basic rights set out according to type of K. Does lawyer-client K fall into one of
nominate Ks?
Pélissier v. Houle [1915] p . 152
 Analyzes position in France. Situation in Quebec is very straightforward. 1732 CCLC:
Advocates, attorneys and notaries, are subject to general rules in this title (title on mandate).
 The relationship is one of mandate.
 When CCQ was adopted, there was no equivalent to art. 1732 CCLC. But principle remains
the same.
 Chapter in CCQ on mandate (2130-2185) applies to lawyer-client relationship:
 2133 CCQ: Mandate is either by gratuitous title or by onerous title. A mandate entered into
between two natural persons is presumed to be by gratuitous title but a professional
mandate is presumed to be given by onerous title.

If you hire a lawyer, and don’t discuss fees, presumption is that lawyer is entitled to be
paid.
 2134 CCQ: Remuneration is determined by K. In absence, usage or law or value of services
rendered.

In Quebec, usage is hourly basis.
Powers of mandatary
 2136 CCQ: powers of a mandatary extend not only to what is expressed in the mandate, but
also to anything that may be inferred therefrom. The mandatary may carry out all acts which
are incidental to such powers and which are necessary for the performance of the mandate.
37

2137 CCQ: Powers granted to persons to perform an act which is an ordinary part of
their profession or calling or which may be inferred form the nature of such profession or
calling, need not be mentioned expressly.
 2175 CCQ ff.: Either party can terminate the contract.
 2185 CCQ: A mandatary is entitled to deduct what the mandator owes him by reason of the
mandate from the sums he is required to remit.
The mandatary may also retain what was entrusted to him by the mandator for the
performance of the mandate until payment of the sums due to him.
 Special rules apply to lawyer-client relationship
Pélissier v. Houle [1915] p .167
Facts:
 Lawyer sends his partner to replace him on the day of the trial. Plaintiff [Houle] declines and
court dismisses the action.
 Lawyer then turns around and sues Houle for fees for work done and Houle refuses on the
grounds that services were not properly rendered. Even though Partner sent Pelissier – it was all
w/in the Partner’s authority.
Held:
 Court concludes that mandate is presumed, unless the act is one that specifically requires
authorization.
 CCP 476: a party may renounce rights arising from a judgment rendered in his favour, by
filing in the office of the court a total or partial renunciation signed by him or by his special
attorney. A total renunciation accepted by the opposite party places the case in the position it was
in immediately before the judgment.
 Reference to King: A lawyer can bind a client until disavowed by any proceeding, even
though taken without client’s authority.
POINT: Once you’ve hired a lawyer, all steps are presumed to be authorized and you are
bound and liable. You must disavow if you don’t approve.
 Lawyers have a broad power to act in their clients shoes and tere is a presumption of
authorization. The client is bound unless the lawyer did something he needed special permission
to do (ex: 476 CCP, above) or until the client “disavows” the lawyer’s action (below).
 The purpose is to protect 3rd parties in GF so they can negotiate with the lawyer as if he was
the client.
 Note, this protects lawyers because short of disavowal, he cannot be challenged.
 In order to deny a mandate, the client must follow the disavowal procedures, whereby a nonauthorized act is cancelled..
Disavowal
 Governed by arts. 243-247 CCP. It is difficult to get, because want to protect stability of
legal relations.
 243 CCP: a party may disavow an attorney ad litem (at litigation) who has exceeded his
powers or who has acted for him without a mandate.
 244 CCP: Disavowal may be taken during the suit or after judgement.
 247 CCP: The consequences of disavowal: if disavowal is maintained, the acts disavowed
are annulled and the parties are placed in the same position as they were in when the acts
were done.
o The lawyer makes an admission that the client did not want to make – if disavowed, it is
stricken from the record.
38
 3 conditions to disavowal:
1. Client did not authorize act.
2. Client did not ratify act.
3. Act must be prejudicial to client.
Hebert v. Deschenes [1978] p. 153
Facts:
 Client goes to lawyer to have a defence filed.
 He was sued on a debt and his defence was that he paid it, but no defence was filed for
unclear reasons (negligence).
 Court renders a default judgement against Hebert. Hebert doesn't find out until bailiff knocks
on his door to seize his furniture.
 Hebert brought an action in disavowal saying he did not authorize lawyer to let the action sit
there, that this was not ratified and that it caused him prejudice.
Held:
 Action dismissed because disavowal is only allowed where lawyer has acted in a certain
way.
 Here there was only a failure to do something. Therefore disavowal is not an option. Can only
disavow an act and not a failure to act.
 POINT: disavowal is only allowed for a commission, not an omission. This shows the
narrow interpretation courts will give to disavowal procedure.
 Note: He still has a recourse – action in negligence against the lawyer.
Valliant v. Okrainec [1983], Civil Law, p. 154
Facts:
 Client hires attorney to sue the contractor who built his house and contractor sued the
subcontractor.
 Under settlement, client drops action against contractor, on condition that subcontractor does
certain work on house.
 The work is unsatisfactory, and client now sues contractor and contractor’s defence is that
they've already settled out of court.
 It is the lawyer’s fault that his client has now effectively lost his recourse.
 Client sues lawyer for recommending this settlement.
Issue:
Can client sue his lawyer here?
Held:
S.C.: Yes.
C.A.: No.
Ratio:
 The client has no right to recover from the lawyer because the client didn't use disavowal.
 Client had an obligation to mitigate damages, he could've disavowed the original settlement,
instead of suing for damages. (Wanted him to sue the contractor again)
 Disavowal was a tool at his disposal; he must use that right given to him by the Code.
 POINT: A plaintiff cannot neglect to use the life preserver (disavowal) that the law puts at
his disposal. Notice how disavowal protects the lawyer because cannot sue if never tried to undo
it.
39
 Policy: Allow debtor windfall, and have client go against lawyer OR fix initial mistake.
Courts have opted for the latter. First, try to fix problem, and let the loss fall where it belongs.
 At the end of the day, disavowal is just the flipside of the presumed mandate. It protects the
lawyer by allowing mistakes to be corrected and allows losses to fall where they ought to. The
fact is that most mistakes made by lawyers are paper mistakes which can be corrected and we
must ask why not let the loss fall where it ought to fall? If a mistake can be corrected, we should.
ONTARIO
 Nature of lawyer-client relationship is discussed in Scherrer v. Paletta (pg. 157). Court held
that the lawyer-client relationship is in general a question of agency. Client is principal, lawyer is
agent. Ontario law of agency applies. 2 consequences thus arise with respect to authority of
lawyer:
1. Between the lawyer and client, the relationship is contractual. The lawyer’s power is
only what is given in the retainer (lawyer-client contract) and subject to any limitations
therein. The lawyer’s authority is what the contract says it is.
2. As far as the 3rd party is concerned, the lawyer’s authority extends to all matters that
can be expected to arise during the proceedings. This is like ostensible authority. The
only limitation on that is that the 3rd party cannot rely on the lawyer’s ostensible authority
if he has knowledge of a limitation of authority.
Scherrer v. Paletta [1966], Common Law, p. 172
Facts:
 Lawyer negotiated an out of court settlement and client repudiates it and says he never agreed
to it.
 Other party asks the court to give effect to the settlement through judgment.
Issue:
Is the defendant entitled to enforce the settlement agreed to by counsel for the plaintiff?
Held:
Yes
Ratio:
 The relationship of a solicitor to his client is in general one of agent to principal.
 The authority of a solicitor arises from his retainer and as far as his client is concerned it is
confined to transacting the business to which the retainer extends and is subject to the
restrictions set out in the retainer.
 The same situation, however, does not exist with respect to others with whom the solicitor
may deal.
 In general, the solicitor is the client’s authorized agent in all matters that may reasonably
be expected to arise for decision in the particular proceedings for which he has been retained.
 Where a principal gives an agent general authority to conduct any business on his behalf, he
is bound as regards third persons by every act done by the agent which is incidental to the
ordinary course of such business or which falls within the apparent scope of the agent’s
authority.
 As between the agent and principal, the authority may be limited by agreements.
 In principal, a settlement is binding on a client, subject to:
40
o
whether the opposing party has knowledge of a limitation on part of the
lawyer i.e. if the plaintifff knew, court would probably not have enforced the
settlement.
o
whether the client is under a disability: courts tend to protect the rights of a
person under disability.
o
the court has discretionary power to intervene but if the terms are clear, they
will not use their discretion.
 POINT: Authority of a lawyer is similar to presumed authority with respect to third parties –
it extends to all matters that reasonably fall within the business of the lawyer.
 Note: If the lawyer did breach the client’s retainer, the lawyer can be sued for the difference
between what he did and what he was allowed to do. The client would have to prove that he
could have gotten what he wanted.
Notes:
 There is still recourse against lawyer. So inclination in Ontario is more to protect 3rd party.
In QC, on the other hand, the client would have to disavow and would not be able to sue the
lawyer as in Vaillant.
Ontario recap
 Under agency, can’t rely on apparent authority of someone you know doesn’t have authority.
 If there is disability, courts will be more inclined to intervene if there are allegations that
there was no authorization.
 Short of these two, sue your lawyer.
Consensual Relationship
 Lawyer-client relationship is consensual, whereby a client can choose which lawyer he wants
to represent him and lawyer is free to accept or reject that mandate.
 A clear exception is the duty to defend a person accused of a crime but this doesn’t apply in
the civil context.
 Exceptions to consensual relationship: Lawyer would be bound to decline mandate, or if he
started to act, should withdraw. Or other party can force to withdraw. There are 2 grounds:
1. Conflict of interest arising from prior representation.
2. Lawyer being called as witness.
1. Conflict of interest
 A lawyer cannot represent two parties. Problem relates to the issue of confidential
information i.e. a lawyer finds himself with confidential information from A that he may be
tempted to use in a matter concerning client B. This is a common situation – esp. with so many
lateral hires and the growing number of “mega-firms.”
McDonald Estates v. Martin [1990], Common Law, p. 159
Facts:
 The litigation was between the estate and the lawyer (Martin) who was a friend of
MacDonald’s in his life and his executor. The estate sued claiming that the lawyer had taken
money from MacDonald during his life and had also taken out money from the estate.
 Martin was represented by Twaddle and MacDonald Estate was represented by Thompson
Dorfman.
41
 Kristen Dangerfield was as associate working on the case for Twaddle (’83), and she switches
firms to Thomson, Dorfman (’87) (lateral hire).
 McDonald is represented by Thompson and Martin makes a motion to have Thompson
dismissed from the case b/c of access to confidential information (conflict of interest) through
Dangerfield.
 Thomson tries to assure the court there's no problem.
 Dangerfield files an affidavit saying she hasn't and won't ever discuss the case with Thomson
- in fact, she has not had further contact with the case because she was on maternity leave. Senior
lawyers file affidavits supporting Dangerfield's claims.
Issue:
What is the appropriate standard to be applied in determining whether Thompson, Dorfman, are
disqualified from continuing to act in this litigation by reason of a conflict of interest?
Held:
Thompson must be removed [4:3 on the reasons though].
Ratio:
[Sopinka J.(4)]:
Identified 3 competing interests at issue in a case like this one:
1. Maintenance and integrity of our justice system: We have rules designed to encourage full
and frank disclosure in the attorney-client relationship. If the associate can work for the other
side, this might damage the relationship with 2 consequences:

It will inhibit attorney-client communications.

The public perception of lawyers and the judicial system will be lowered if the public
senses that lawyers can move around and bring confidential information with them that
they can use against them in the future.
2. The right of litigants to choose their own lawyers and to keep the ones they've chosen
(McDonald has the right not be deprived of its choice of attorney. Doing so would create an
expense, and delay the proceedings, cause him to lose Thomson's expertise and would give
opportunity for harassment since such motions can be made to create difficulties for the other
side.
3. The desirability of permitting reasonable mobility in the legal profession – otherwise,
lawyers would be stuck in their firms forever.
 Sopinka Created a 2-step test:
 First step: Determine whether the “tainted lawyer” is in fact “tainted.”.
 Established a “presumption.”: If the complainant can show that there existed a previous
relationship between the client and the tainted lawyer and that this relationship was sufficiently
closely related to the current matter the court will presume confidential information was imparted.
 Rebutting the presumption is a difficult burden to discharge – not only must the court’s
degree of satisfaction be such that it would withstand the scrutiny of the reasonably informed
member of the public that no such information passed, but the burden must be discharged without
revealing the specifics of the privileged communication.
 If you don't rebut the presumption and lawyer is tainted, go on to 2nd branch of test
 Second step: consequences of having a tainted lawyer.
 Lawyer can't work on this action and the rest of the firm is also disqualified unless the
court is satisfied that all reasonable measures have been taken to prevent information from
being disclosed to the rest of the firm.
42
 Reasonably sufficient undertakings and affidavits are not enough. There must be a kind of
institutional mechanism which must be approved and regulated by the bar, setting out guidelines
(i.e. Chinese walls and cones of silence).
 Sopinka's application of this test to the case:
 She is a tainted lawyer. It is the same mandate, so presumed that she had access to
confidential information. Presumption is not rebutted.
 Court then held with respect the law firm that promises are not good enough. There is no
institutional mechanism in place approved by the Man. Bar. Therefore, because of inadequate
measures, the whole law firm is tainted and it must cease to act.
[Cory J. (3)]: Harder line:
 Disagrees with first branch of Sopinka’s test.
 Suggests that the presumption should not be a rebuttable one. Takes a narrower, more fact
specific approach. Once demonstrate the link, the lawyer is automatically tainted. since (1)
difficult to rebut; and (2) in rebutting, the confidential information comes to light.
 But, with respect to 2nd branch, where the tainted lawyer joins another firm, there should be
an irrebutable presumption that lawyers who work together share each others confidences.
 “Water Cooler Theory”: once one lawyer has confidential information, everyone in the firm
knows it. So whole firm is disqualified because presume she'll tell them everything.
 Cory's concerned w/pub opinion.
 Note: After the SCC, the estate replaced their firm and continued their litigation and got a
final resolution in 1993 on the merits. Martin (the lawyer) got his ass handed to him.
Notes:
 Cory’s judgment is problematic because he ends with the following: Assume that Twaddle
was a big firm, and that Dangerfield has nothing to do with Martin. She joins Thompson. Cory
leaves to another day to determine whether she was talking around water cooler at old firm.
o Implication: Whenever anyone changes firms, second firm has to be prepared to
lose all files which are opposite first firm.
 Sopinka judgment is now the law. Cory judgment is dangerous.
 After this decision, various law societies sprung into action to set up a body of rules, to
prevent law firm from becoming tainted. Note that the holding in Martin required the local Bars
to have a policy re: conflicts and to regulate conflict avoidance mechanisms.
 Canadian Bar Association set up rules (pg. 167 CB). There are 13 recommendations:
1. Screened lawyer (lawyer with information) should not participate in current
representation.
2. Screened lawyer should not disclose confidential information.
3. No member of new firm should disclose confidential information relation to current
matter or prior representation with screened lawyer.
4. Current client matter should be discussed only with limited group who are working on
matter.
5. Current files should be physically separated.
6. No member of the new firm should show the screened lawyer any documents relating to
the current client matter.
7. Should be written policy.
8. Relevant firm members should provide affidavits or undertakings setting out that they
have adhered to and they will continue to adhere to all elements of the screen.
43
9. Inform client of presence of lawyer.
10. Inform client of measures taken.
11. Screened lawyers office should be located away from offices of lawyers working on file.
12. Screened lawyers should work with different associate and support personnel.
 Prof. doubts that these are sufficient. The 13th is interesting:
13. Obtain former client’s consent.
 Recommendations summarized: The Canadian Bar Association set up a task-force and
adopted rules (p.167): the key concepts are that: 1) everyone involved on the case should know
not to talk to the tainted lawyer about the case; 2) all key documents should be kept away from
the tainted lawyer; 3) the measures taken by the firm to screen its lawyers should be in a written
policy and should include in the policy that the sanctions for breaching the policy extend to
dismissal. Another key aspect of these guidelines is that the lawyer should inform the client of
the existence of the potential conflict and get the client’s informed consent.
 Pursuant to the CBA’s recommendations, Quebec and Ontario adopted regulations.
Quebec
 Code of Ethics 3.06.08 (p. 109): To decide any question relating to a conflict of interest,
consideration must be given to (a) the higher interests of justice; (b) the explicit or implicit
consent of the parties; (c) the extent of prejudice for each of the parties; (d) the time elapsed since
the origin of the situation that could give rise to the conflict; and (e) the good faith of the parties.
 Code of Ethics 3.06.09: Where a member of a firm is in a conflict of interest, to avoid being
considered in a conflict yourself as a member, take special measures to ensure that
confidential information or documents pertaining to the file are not revealed. In assessing
the effectiveness of these measures, the following factors may be taken into account:
(1)
(2)
(3)
(4)
Size of the firm;
Precautions taken to prevent access to the file;
Instructions given as to the protection of the confidential information;
Relative isolation of the advocate in a conflict.
ONTARIO
 2.04(5) (p.120): where a lawyer has acted for a former client and obtained confidential
information relevant to a new matter, the lawyer’s partner or association may act in the new
matter against the former client if:
the former client consents to the lawyer’s partner or associate acting, or
the law firm establishes that it is in the interests of justice that it act in the new
matter having regard to all relevant circumstances, including
(i)
the adequacy and timing of measures taken to ensure that no disclosure of the
former client’s confidential information to the partner having carriage of the new
matter will occur,
(ii)
the extent of prejudice to any party,
(iii)
the good faith of the parties,
(iv)
the availability of suitable alternative counsel, and
(v)
issues affecting the public interest.
(a)
(b)
 2.05(4) (p.121): where the transferring member actually possesses relevant information
respecting the former client that is confidential and that, if disclosed to a member of the new law
44
firm, may prejudice the former client, the new law firm shall cease its representation of its
client in the matter unless …[see factors above].
Re Manville Canada and Ladner Downs [1998], Common Law, p. 168
Facts:
 Raises the problem of international partnerships.
 Ladner, Osler, and Ogilvy had an international partnership under the name Osler, Renaud,
Ladner. Which worked together I the US and overseas but still were separate entities in Canada.
 Problem was that an asbestos company names Manville had hired Osler and had disclosed
confidential information to the firm in Toronto and at the same time it was being sued by a client
of Ladner in Vancouver.
Issue:
Should Ladner should be disqualified for a conflict of interest?
Held:
No.
Ratio:
 The court looked at structure of partnership, and concluded that there wasn’t a sharing of
information in Canada.
 This was a partnership of partners. They remained separate for their Canadian practices, even
to the extent that they reserved the right to, and did in fact, compete with each other in the
domestic market.
 Note: today, looking at true national firms, would come to opposite conclusion. International
partnerships are largely a thing of the past.
 Firms handle these issues by circulating memos containing the names of people you are not
allowed to talk to. The sanction would be that you can lose the mandate and the client can try to
get back the money that he paid before the breach of the Chinese wall.
 The individual lawyer has a duty to keep information confidential.
 Another great shock that lawyers had was in Neil (2002 3 SCR 631) which held that lawyers
owe a duty of loyalty to their clients and the consequence is that the lawyer may not represent a
client whose interests are completely adverse to the interests of another client, even if the
mandates are unavailable. The way out is informed consent followed by independent legal advice
and that the lawyer is confident that he’s up to the job. So, if A is suing B (my firm’s client in
another file), My firm is not able to act for A in the litigation unless we get informed consent.
 This rule is a major problem for big firms – Osler cannot act for one client in Montreal and
against him in Calgary.
 Note that no duty of loyalty is owed to a former client – it is only due to a current client. You
cannot solve the duty of loyalty problem with an ethical wall – you need actual consent.
 The only exception is the doctrine of informed consent. The SCC recognized that there are
professional litigants who won’t mind if you are acting for them and against them in unrelated
files (governments and banks).
 The above discussion makes it clear that a client cannot choose any lawyer – he cannot
choose a lawyer that previously acted for the other party.
45
2. Being called as witness
 Lawyer may also be called as a witness. If you have sole practitioner, for that person to act as
lawyer and witness in same case is awkward. Lawyer’s credibility is at issue as witness. When
pleading, lawyer must say “As I explained when I testified” or “My version was correct.”
 Under Code of Ethics and CBA rules, there is fundamental contradiction between these two
roles. Not allowed.
o Exceptions: Testimony about fees.
 Problems:
1. Law firm context.
2. Not knowing if person will be called.
 For law firm, decisions have gone both ways. Depends how contentious matter is.
 Courts have tended to wait and see if lawyer will be called and point is contentious. They do
not force law firms to withdraw until situation actually arises (Federation des Medecins case).
 Law firms generally will try to make assessment in advance of trial, so as not to later disrupt
trial.
QUEBEC
Code of Ethics 3.05.06 (p.109): the advocate must not, personally, accept a mandate or
continue the execution thereof in a dispute if he knows or if it is evident that he shall be called
upon as witness. However, he may accept or continue such mandate if the fact of not filing it is
of a nature to cause serious and irrevocable prejudice to the client , or if his testimony only
refers to:
(a) An uncontested matter;
(b) A question of form and where there is no reason to believe that serious proof shall
be offered to contradict such testimony;
(c) The nature and value of the legal services he or his law firm have rendered the
client [i.e. sued on billing and testifies on billing].
ONTARIO
4.02(2) (p.128): Subject to any contrary provisions of the law or the discretion of the tribunal
before which a lawyer is appearing, a lawyer who appears as advocate shall not testify before
the tribunal unless permitted to do so by the rules of court or the rules of procedure of the
tribunal, or unless the matter is purely formal or uncontrovereted.
 The general problem is that you may not know whether you will be called as a witness. The
courts take a “wait and see” approach, that is, they will let you start pleading if it is not clear
that you will be called upon. Even if the other side says they will call the lawyer, the court
will let the trial proceed and allow the lawyer to take the risk (if he wants) that he will have to
remove himself.
Gestion Panaber Inc. v. Banque TD [2000], Civil Law, p. 1871
If it turns out that the lawyer does have to testify, there are 2 outcomes – either the firm cannot
continue to act as lawyers in the case or the judge will not allow the testimony.
Changing lawyers
46
QUEBEC
 Art. 248-253.1 CCP. Also provisions in Code of Ethics.
 In principal, a the attorney-client relationship is consensual. So the lawyer can be fired or can
quit anytime.
 3 limitations:
1. Rule to protect attorney. Client who fires lawyer must pay all fees and disbursements of
lawyers (art. 252 CCP). To give effect to this right, lawyer who has been fired has right
to retain property of client until he/she has been paid (e.g., hold on to documents,
physical evidence, etc.) (2185 CCQ)
2. Lawyer must not withdraw unless he/she has sound and reasonable grounds (R. 3.03.04
CE). If lawyer does withdraw, lawyer must take necessary provisions to avoid serious
and foreseeable prejudice to client (R. 3.03.05, pg. 108)
Code of Ethics 3.03.04: Unless he has sound and reasonable grounds to the contrary, an
advocate may not cease to act for the account of a client. The following shall, constitute these
grounds:
(a)
Loss of the client’s confidence;
(b)
The fact that he has been deceived by the client or his failure to cooperate;
(c)
Inducement by the client to perform illegal, unfair, immoral or fraudulent acts;
(d)
Persistence by the client to continue a futile proceeding;
(e)
Advocate is placed in a situation of conflict of interest or where his professional
independence may come into question;
(f)
Refusal by the client to acknowledge and obligation respecting costs, disbursements
and fees…
Code of Ethics: 3.03.05: the advocate may unilaterally terminate mandate after having taken the
necessary provisions to avoid serious and foreseeable prejudice to his client.
 Most sound and reasonable ground: Not getting paid. Also, difficulty
communicating with client, cannot find client, cannot agree on strategy.
 For second part, if you’re involved in securities file, cannot go to client day
before you’re supposed to sign off and issue prospectus and give bill for $100 000
and refuse to give if not paid immediately. Must give sufficient notice so client can
find someone to replace you.
 Right of retention. If give week to pay $100 000 bill, and client finds another
lawyer but does not pay, cannot retain file.
 SH: Have right of retention if lawyer has been fired or quits (art. 2185 CCQ).
3. If in the context of litigation and the client wants to fire the lawyer or the lawyer wants to
fire the client, the party needs permission from either the court or the other side since it
will cause the other side a prejudice. CCP 252 for client; CCP 249 for the lawyer.
 Once you’re in litigation, may have impact on other party. Judge has to decide if
other party will be unduly prejudiced.
ONTARIO
 Similar principles, similar limits.
 s. 6 Solicitor’s Act provides a right of retention until paid.
 2.09(1) (p. 112): a lawyer shall not withdraw form representation of a client except for good
cause and upon notice to the client appropriate in the circumstances.
47
 2.09 (3): where, after reasonable notice, the client fails to provide funds on account of
disbursements or fees, a lawyer may withdraw unless serious prejudice to the client would
result.
 2.09 (8): when a lawyer withdraws, the lawyer shall try to minimize expense and avoid
prejudice to the client and shall do all that can reasonably be done to facilitate the orderly
transfer of the matter to the successor lawyer.
 2.09 (9): upon discharge or withdrawal, a lawyer shall: (a) deliver all papers and property to
which the client is entitled; (b) give the client all information that he may need; (c) account for all
funds of the client then held; (d) promptly render an account for outstanding fees and
disbursements; and (e) cooperate with the successor lawyer so as to minimize expense and avoid
prejudice to the client.
Tory case, p. 175
 Mandate was to obtain injunction to prevent holding of referendum. Partner accepted
mandate.
 Executive Committee found out about mandate, was upset. Majority of Tory’s clients wanted
referendum. Wanted to get out of mandate. Problem: Only realized this a few days before they
were scheduled to be in court.
 Ontario Rules of Professional Conduct, Rule 8: Can’t withdraw if will cause prejudice. Here,
Native Women’s Association could not find adequate counsel in time.
 Compromise: Partner went on leave of absence. Tory’s allocated some of resources, but it’s
name came out of proceedings.
 NWA filed complaint, saying Tory’s had withdrawn, and that they were prejudiced. They
only had one associate instead of three, no access to Tory’s office, etc.
 LSUC: There was prejudice by this last minute change. No sanction imposed.
Ontario Rules of Civil Procedure
 R. 15.03: Under Ontario rules, client can fire lawyer and hire new lawyer by filing notice.
 R. 15.04: If solicitor wants to withdraw, need court order.
High Profile Custody Case, 2000, p.174
 A woman had gone through 21 lawyers in a year custody case. She fired some and others
quit because she was abusive.
 The 22nd lawyer wanted to quit.
 The judge refused to allow him to quit unless she could find new counsel before the trial was
going to resume, because he should have known what he was getting himself into.
Lawyer’s liability
 Because of the complicated nature of the lawyer-client relationship (contract + Code of Ethics
+ obligations to court, etc.), the lawyer has obligations which flow from several different sources.
 Complaint can be made by (a) client (i.e. failure to disclose stuff, failure to act w/in
instructions) or (b) another lawyer (i.e. frivolous litigation, unnecessary prolonging) (c) judge –
no examples exist of official complaints – but many judges have made comments within their
judgments which amount to warnings of sorts
1. From Client
 Can be sued for breach of K: Don’t render services, render services in negligent way, exceed
authority.
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 In Quebec, this is always subject to the possibility of disavowal so can undo the harm by
disavowing the particular act so then no need to sue the lawyer. But, if harm can't be undone,
client has this recourse against the lawyer.
Immunity
Limitation exists in England; barrister is immune from action for negligence in conduct of trial
(Rondel v. Worsley p. 177) the House of Lords reaffirmed this immunity based on 4 concerns:
1. Lawyer has a duty to the court and he may sacrifice it if he fears a suit by his client e.g.
duty to bring forth all relevant authorities even those that are detrimental to client's case.
(Exists in Que.)
2. Re-litigation: If lawyer is sued for having lost a case, the client would have to re-litigate
to establish that but for Barrister's negligence, he would have won.
3. Obligation to accept any client: regardless of difficulty of the case may be compromised
if lawyer is worried the client would turn around and sue him. (i.e. concerns re: v.
litigious clients.)
4. The immunity is consistent with the absolute privilege with respect to what gets said in
court (in the context of defamation).
5. Immunity is consistent w/the absolute privilege re what is said in court. Immunity is the
natural extension of the complete protection from defamation (The HL narrowed the
immunity by making it clear that it only extends to what goes on at trial).
In Canada, there is no immunity (Demarco)
Demarco v. Unger [1979], Common Law, p. 191
Issue:
Is a lawyer immune from action at the suit of a client for negligence in the conduct of the client’s
civil case in Court?
Held:
No.
Ratio:
1. No evidence to support argument that lawyers who fear litigation will sacrifice their duty to
the court
2. Re-litigation is inconvenient but doesn't justify leaving the client w/no recourse.
3. No such duty to accept any client exists in civil matters in Canada
4. Absolute privilege is limited to defamation and doesn't justify immunity from negligence.
POINT: Public interest in Ontario does not require this kind of immunity.
 The fact is that it would take some hardcore negligence to find a lawyer liable in the litigation
context.
 Outside of the litigation process – lawyers have liability. If the lawyer fails in drafting or
fails to do what the client wants to the client’s detriment, the lawyer can be held liable.
Summary: Immunity
49
Ontario: rule is that you can sue a barrister for negligently conducting a case in court. It would
be rare b/c it's difficult to establish that result would've been different, but as a matter of law, that
recourse is available. More likely to be treated as an error of judgment.
Quebec: Okrainec v. Vaillant (p.154): the 1st instance decision was that the lawyer was liable for
his error in drafting and he was held liable for the amount that should have been recovered if not
for that settlement. The CA overturned, insisting that the correct recourse for the client would be
to disavow. It seems that a client can only sue if the error cannot be fixed by disavowal.
Insurance
 Mistakes occur primarily with respect to real estate, not litigation. There are errors with title
and security.
 As a result of potential liability of lawyers, Bar has required mandatory insurance. See pg.
51.
 Quebec Bar insurance has substantial surplus, so there has been no premium for the last 3
years.
 In Ontario, there has been a rash of claims, and premiums have shot up.
 Bar insurance only covers acts entered into as a lawyer (not if lawyer provides investment
advice, or if lawyer defrauds client).
Rice et al. v. Canadian Lawyers Insurance Association [1996], Common Law, p. 183
 Liability insurance policy covered “any act, error or omission which occurs in the
performance of professional services for others”, “professional services” being defined as those
services normally provided by a lawyer within the context of the usual solicitor-client
relationship.”
 The lawyer induced persons to invest money by writing a letter in which he stated that in his
opinion there was adequate security for the investment.
 The letter was inaccurate and the investors lost money,
 He was sued and settled.
Issue:
What is the scope of the insurance policy?
Held:
Lawyer is liable, insurance company not because not covered.
Ratio:
 At no time was the lawyer retained to provide legal services for the plaintiffs.
 I can find no evidence that what he did was in any way connected to the practice of his
profession. He made none of the inquiries or investigations that a lawyer would be bound to make
before providing an opinion as to the security for the investment.
 No doubt the lawyer pretended to provide a legal opinion in order to facilitate a transaction to
meet his own personal requirements but he applied not a scintilla of legal skill or knowledge.
POINT: Professional insurance only covers negligence of acts committed in during the
practice of the profession.
 In Quebec, limit is $1 million.
 Most law firms have private insurance over and above.
 With LLP structure, compulsory insurance will increase, to ensure that public remains
protected.
50
2. Disciplinary proceedings
 The 2nd area of liability is with respect to disciplinary proceedings. Lawyers are obliged to
follow certain ethical rules. If client asks lawyer to do something contrary to Code of Ethics,
lawyer in awkward position. Obligation is to tell client that you cannot do it, and why. If client
still insists, must fire him. It is not defence that you were so instructed by client.
3. To court
 3rd area of liability – to court. This covers a few things:
1. Court can order lawyer to respect undertaking even if client orders lawyer no to comply
 Lawyers are officers of the court so the court can issue an order against the lawyer.
 Witten, Volgel, Binder & Lyons v. Leung [1983] p. 185: The enforcement of undertakings
being absed on the court’s aim of securing proper conduct on the part of its officers, the court has
an inherent jurisdiction to enforce an undertaking.
2. Court has power to request that lawyer personally pay court costs.
Ontario
57.07 of the Rules of Civil Procedure: where a solicitor for a party has caused costs to be
incurred without reasonable cause or to be wasted by undue delay, negligence or other default,
the court may make an order,
(a)
(b)
(c)
disallowing costs between the solicitor and client or directing the solicitor to repay to the
client money paid on account of costs;
directing the solicitor to reimburse the client for any costs that the client has been ordered
to pay to any other party; and
requiring the solicitor personally to pay the costs of any party.
Torquemada, p. 187: a lawyer whose handling of a personal injury case was described by a judge
as displaying gross negligence and incompetence and was consequently ordered to personally pay
the other side’s costs.
Young v. Young p. 203: McLachlin J. said that that any member of the legal profession might
be subject to a compensatory order for costs if it is shown that repetitive and irrelevant
material, and excessive motions and applications, characterized the proceedings in which they
were involved, and that the lawyer acted in bad faith in encouraging this abuse and delay.
 Courts must be extremely cautious in awarding costs personally against a lawyer, given
the duties upon a lawyer to guard confidentiality of instructions and to bring forward with
courage even unpopular causes.
Quebec
Foucault Pontiac Buick Inc. v. Clinique Auto [1985], Civil Law, p. 189
 Held that the court did not have the jurisdiction to order court costs.
 In this case, there was a valid recourse against the corporation but the plaintiff also sued the
plaintiff personally to turn up the heat. They also seized and removed his furniture. The QC
51
court said that this was a clear abuse since the dispute did not concern the president – they found
the defendant corporation liable but not the president and they made the plaintiff pay the costs.
The Court said that they would like to force the lawyer to pay court costs but that they couldn’t
since the lawyer was not a party. The judge also indicated that the plaintiff could probably
successfully sue the lawyer for the court costs.
 The court said that to force the lawyer to pay costs, you would need a separate action
because the lawyer is not a party to this litigation.
Droit de la Famille 1777 [1994 – C.A.] p. 206
Facts:
 Parizeau was representing a woman who had signed a prenuptial and was suing for an
additional $55 million in divorce settlement.
 There was a seizure before judgement - in 26 separate motions court froze husband's assets.
 At superior court the claim was dismissed after a lengthy trial and it quashed all 26 seizures.
 Court said the claim was ridiculous - she's entitled to amounts under prenuptial agreement so
this was a waste of time.
 Husband's lawyer suggested that Parizeau should have to pay his client's court costs because
the seizures were abusive and he knew about the settlement agreements...
 Judge agreed.
 Judge then gave the woman a separate hearing then ordered her lawyer to pay 75% of court
costs including a $20k special fee under s.15 (complicated case fee) and her to pay 25%.
 Judge reserved the wife's right to claim back fees from the lawyer and the husband’s right to
sue Parizeau in a separate action (J was really hard on her Lawyer).
Ratio:
 This isn't an appropriate case to order lawyer to pay but limited discretion does exist to order
lawyer to pay costs personally. (Overturning Foucault – by using Young v.Young).
 Reference to Young case, where SCC warned to be cautious: Whatever goes on between
client and lawyer is confidential. If you allow lawyer to pay costs too easily, putting pressure on
confidentiality of relationship. Court also referred to duty on lawyer to bring forward with
courage even unpopular causes. Don’t want to create situation where lawyer is afraid to take on
loser cases out of fear of paying court costs. Court went on to set standard for ordering that
lawyers pay court costs. Quebec CA undertook SCC standard. Also said that $20 000 special fee
was punitive.
POINT: Recognition in Quebec of the jurisdiction of the court to force a lawyer to pay court
costs.
4. Contempt of court.
If a lawyer disobeys a judge’s order or otherwise acts improperly inside or outside of the court, he
can be found in contempt of court.
5. Liability to 3rd parties.
 This is extra-contractual liability. In Droit de la Famille – 1777, the husband did actually sue
the wife’s lawyer. He claimed all of his legal fees and expenses that hadn’t been compensated by
the court order and he claimed damages from the seizures and the bank account freezes as well as
punitive damages ($2 000 000) and it was settled out of court. This shows that this kind of
recourse is at least possible.
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V. The Judge
 Topics:
1. Appointment
2. Judicial Independence:
a. Security of Tenure and Discipline
b. Salaries
c. Administrative Independence
3. Judicial Immunity
4. Recusation
5. Powers of judges, including contempt of court
A. Appointment of Judges
Provincial
Inferior
Superior
Federal
Better Administration
General Court of Appeal
 The Court system is essentially provincial. The more important courts are organized
province by province.
 S. 92.14 Constitution Act: The Administration of Justice in the Province, including the
Constitution, Maintenance, and Organization of Provincial Courts, both of Civil and of Criminal
Jurisdiction, and including Procedure in Civil Matters in those Courts.
 This is why the CCP is provincial legislation.
 This does not mean that all judges are provincially appointed…
 s. 92.4 Constitution Act: The Establishment and Tenure of Provincial Offices and the
Appointment and Payment of Provincial Officers.
 This would theoretically include judges but s.96 clarifies the situation.
 S. 96 Constitution: The Governor General shall appoint the judges of the Superior, District
and County Courts in each Province (SC’s), except those of the Courts of Probate in Nova Scotia
and New Brunswick.
 As such, court are divided into SC’s and Courts which are not SC’s (broadly: inferior courts).
The Provinces appoint the judges for courts which are not SC’s whereas the Feds appoint SC
judges.
 Constitutional Issue: Can a Province strip the jurisdiction of the SC’s by giving jurisdiction to
inferior courts? S.96 has been held to uphold the principle that the provinces cannot strip the
powers of SC’s.
 Provinces cannot abolish SC’s, because jurisdiction would be given to inferior court, and
judges that would exercise powers of SC judges would be provincially appointed and not
Federally appointed.
 So powers exercised by SC’s in 1867 must be continued to be exercised by an SC.
 This comes up in Administrative Law, because SC’s take on advisory role with respect to
administrative tribunals. If jurisdiction is given to inferior courts, have s. 96 issue.
 Also have federal courts. These courts have fairly restrictive jurisdiction. Creation is
authorized under s. 101. It allows for the creation of:
o General Court of Appeal: SCC.
o Courts established for better administration of the laws of Canada: Federal Court.
 These are federally organized courts.
53
Federally appointed judges
Superior court judges:
 Superior court, s. 96 Constitution. Appointed by Governor General. In US, there is
confirmation process – President has power to appoint judges, but judges must go through
confirmation process with Senate. Here, there is no role for anybody but Governor General.
 In practice, GG is Federal Justice Minister. Prime Minister only gets involved for the
appointment of CJ’s and SCC judges.
 S. 97 and s. 98 provide that judges are to be appointed from provincial Bar.
 Judges Act provides that a person who has been appointed as judge must be a member of Bar
of province for at least 10 years. There are no lay judges at Superior Court level.
Federal court judges:
 Nothing in Constitution.
 Under Federal Court Act, they are appointed by GG. In practice, Federal Justice Minister or
Prime Minister for chief justice.
 Must be either judge or member of Bar for 10 years.
 Of 31 judges, 10 must be from Quebec.
SCC judges:
 Nothing in Constitution.
 Under SC Act, appointed by GG. Again, see above.
 Must be judge or lawyer with 10 years practice.
 At least 3 of 9 judges must be from Quebec.
 Traditionally, have 3 from Quebec, 3 from Ontario, 1 from Maritime, 2 from West (1 from
BC, and 1 rotating from 3 prairie provinces).
 Role of CJ alternated between Anglo and Franco.
 Appointment of SCC judges has been one of Quebec’s issues with Constitution. It wants to
have role in appointment. Meech Lake Accord formalized process, provincial gov’ts would have
been given role (put together list of candidates from which Federal Gov’t could choose).
Argument is that SCC is national body. Moreover, it has final word on disputes between federal
and provincial gov’ts. But Accord fell. So still exclusively a federal prerogative.
 The Canadian Bar Association has been trying to gain a role for itself in appointments since
1967. That year, the CBA set up a committee on judicial appointments so that it could express its
views on upcoming judicial appointments and the Federal justice committee would informally
consult with them. The committee would rate judges (only yes or no) and the justice minister
would then do what he wanted.
 Two incidents in 1980s led to pressure to curtail discretion:
1. Rash of federal court appointments by Trudeau prior to his resignation. 4 of his cabinet
ministers were named directly to Federal Court. Should not have patronage decisions.
2. Mulroney gov’t named Lion, Premier of Manitoba. CBA had said no, but he was named
nevertheless.
 Ziegel (p. 193) is highly critical of these types of actions and recommended reforms.
 There was new process established in 1988, which formalized the status quo (p.194). It
established new commission (Federal Judicial Affairs Commission), which advertised positions,
created application process.
 Application forms are reviewed by advisory committees in each Province. This committee is
made up of the CJ, 2 members of Bar, 1 rep. of CBA, 3 members of public (public interest)
appointed by the Feds. Committee reviews applications, contacts references, makes independent
54
inquires. It classifies each applicant as highly recommended, recommended, or unable to
recommend.
 In first 10 years of this system, there were 4300 applicants reviewed by provincial advisory
committees. 42% were either highly recommended or recommended.
 Justice Minister has still not surrendered any of his discretion. He can choose whomever he
wants, so long as person has gone through application process.
 For SCC, no formalities whatsoever.
 There has been attempt to limit discretion with respect to government officials. This attempt
has been breached with respect to CJ of Nfld CA.
Inferior court justices
 All provincial appointees. Appointed by provincial Cabinet (Justice Minister).
 In all provinces, judges must be lawyers. Typically, 10-year req’t.
 In Quebec, Man, BC, there is Judicial Selection Committee established under legislation.
QUEBEC
 S. 87 Courts of Justice Act: A candidate must be a lawyer with at least 10 years practice or
other pertinent legal experience (professors).
 S. 88 Courts of Justice Act: A candidate must be apt for appointment as a judge. Regulations
set out procedure for establishing whether candidate is apt for judicial appointment:
1. Gov’t must publish ad in newspaper when there is opening (see p.197).
2. Applicant must submit CV, essay.
3. Selection committee is 1 judge, 1 lawyer, and 1 person who is neither judge nor lawyer.
Committee meets candidates. Selection criteria: assesses legal knowledge, insight,
capacity for judgment, concept of judge's duty (selection criteria at s.18) (note - no
language requirement). It comes to conclusions as to whether candidate is appropriate or
not.
4. Committee files report with Minister.
5. Minister can appoint any candidate who is apt. So candidates must pass this selection
process to be named. This is key difference with federally appointed judges.

There is no way of ensuring that best judges are selected. But generally have high quality of
judicial appointments in Canada.
 P.198: After Michel Robert was named CJ of the CA, this editorial appeared in the Gazette.
There was criticism because he used to be a Federal Liberal bigwig who was instrumental in the
ascension of Chretien. The Gazette called for a confirmation process to avoid any kind of
potential problem.
 In the US, the confrimartion process is bitter and circus-like. Clarence Thomas was accused
of sexual harassment by a former employee and it became a big circus. At the end, he said he
didn’t care if he got the nomination because it was such a rough ride (p.200).
 P.201: Judicial elections are another idea but it may be inconsistent with the judge’s role in
society. Issues that arise include campaign financing (where will the judge raise money? Can
they accept money from lawyers? What are the implications?), the impact on judicial
independence (are decisions based on electoral concerns rather than the law?), an uninformed
electorate (the public is not a good judge of judges). A judge should not have to be hustling for
votes.
55
B. Judicial Independence
 There is guarantee in Bill of Rights (2(f)) and Charter (11(d)) of independent and impartial
tribunal.
 Quebec Charter (23) guarantees independence in civil and criminal matters.
 Independence: Judge must be completely free of any interference with or pressure by gov’t.
Particularly significant in criminal matters, where one of litigants is State. The only concern that
a judge should have in making decisions is the law.
 Historically, in early Norman period, King was fountain of justice. If a citizen had a
problem, he’d go to King, the ultimate source of justice.
 King delegated power to entourage (Court of King’s Bench). Early judges acted on behalf of
and instead of King.
 Over time, specialized courts and professional judiciary emerged. Courts were free from
interference by Crown. Although in some cases, King would choose to exercise power. In 17th
Century, Stuart Kings would dismiss judges with whom they were displeased. King would also
retain salaries.
 When the Stuart line fell in 1688, Parliament dealt with judicial independence and the Act of
Settlement of 1701 was adopted.
 In 1701, Parliament adopted Act of Settlement. 2 fundamental changes:
1. Judges were no longer appointed at pleasure of King, but during good behaviour and
subject to removal only on joint address of both Houses of Parliament.
2. Judges salaries were taken out of hands of King and set by Parliament.
** The first notion refers to security of tenure, the second to security of salary, benefits. These
are cornerstones of judicial independence today.
I. Security of Tenure and Discipline
Federally appointed judges
 S. 99(1) Constitution Act: subject to subsection (2), the Judges of the Superior Courts shall
hold office during good behaviour, but shall be removable by the GG on Address of the Senate
and House of Commons.
 s. 99(2) Constitution Act: A Judge of the Superior Court, whether appointed before or after
the coming into force of this section, shall cease to hold office upon attaining the age of 75 or
upon the coming into force of this section if at that time he has already attained that age.
 For federal court judges and the S.C.C. judges, the same requirements stand (see s.8 Federal
Court Act and s. 9 Supreme Court Act).
 Power to remove judges is limited by terms of Judges Act. Before Parliament can exercise its
power, must be inquiry by Canadian Judicial Council and recommendation by Council that judge
be removed.
 Judicial Council was formed in 1971 and is composed of the CJ of the S.C.C and CJ of all
federally appointed courts (39 members on the council). The council was given the authority to
investigate judges and to recommend their removal from office (ss. 58-71 of the Judges Act –
p.205).
 If it recommends that a judge ought to be removed, Parliament can act on that
recommendation, but cannot act to remove a judge unilaterally.
 When Parliament alone had the power to do it, there were 5 instances where Parliament
considered removal. 4 of those were prior to 1882. In none of 5 cases did Parliament actually
56
remove judge. So delegation of power was not necessary from a practical point of view, but good
from principle point of view to have independent body play role.
 s. 63 Judges Act: The Council shall, at the request of the Minister or attorney general of
a province, commence an inquiry as to whether a judge of a superior court or of the Tax Court
of Canada should be removed from office.
 The Council can also investigate on its own.
 S.65(1): After investigating, the council submits its report to the appropriate minister.
 s. 65(2): Where, in the opinion of the Council, the judge in respect of whom an inquiry or
investigation has been made has become incapacitated or disabled from the due execution of the
office of judge by reason of:
(a) age or infirmity,
(b) having been guilty of misconduct,
(c) having failed in the due execution of that office, or
(d) having been placed, by his conduct or otherwise, in a position incompatible
with the due execution of that office,
The Council, in its report to the Minister, may recommend that the judge be removed from
office.
Re Gratton and Canadian Judicial Council et al. [1994] p. 222
Facts:
 A judge suffered from an illness (stroke) that made him unable to hear cases for more than an
hour and he refused to resign.
 The Chief Justice reported to the Canadian Judicial Council that there was reason to believe
that the applicant was incapacitated or disabled from the due execution of the office of judge
pursuant to s. 65(2) of the Judges Act.
 The judge challenged the constitutional validity of the proceedings on the ground that
incapacity was not a valid ground for removal of a judge as s. 99(1) of the Constitution Act
guarantees tenure to superior court judges until the age of 75 during “good behaviour”.
 He claimed that incapacity based on infirmity did not constitute a breach of good behaviour.
 Also, he claimed that s. 99(1) had vested the power to remove judges solely in Parliament and
that Parliament had unlawfully delegated that power to the Judicial Council.
Issues:
1. Could incapacity constitute a breach of good behaviour?
2. Did Parliament over-delegate?
Held:
1. Yes.
2. No.
Ratio:
 The failure to perform the function of the office of judge by reason of permanent infirmity
can constitute a breach of good behaviour.
 Breach of good behaviour extends beyond “misbehaviour” to include non-behaviour.
 A superior court judge permanently disabled so as to be incapable of performing his functions
as a judge may constitutionally be found to be in breach of good behaviour.
 There is noting unlawful in Parliament’s conferral of authority with respect to the
removal of judges on the judicial Council and its Inquiry Committee.
 Parliament, in the exercise of this jurisdiction did not unlawfully delegate functions assigned
to it by s. 99(1). Parliament has not abdicated its power - it is for the Canadian Judicial
57
committee to recommend removal but Parliament has the ultimate responsibility for removal of
judges by means of the joint address.
POINT: “good behaviour” includes misbehaviour. Parliament ultimately decides on
removal and has consequently not over-delegated.
 Where a complaint is received with respect to a judge, reviewed by Chair of Judicial Conduct
Committee (SH: The Committee is a committee of the Council and it has the jurisdiction to
investigate complaints and report back to the full Council.) At that stage, most complaints are
dismissed. If there is a serious issue, Judicial Conduct Committee will appoint panel to
investigate. This panel will look at case. Has power to close file, to express disapproval, or
conduct formal investigation.
 If there is formal investigation, a body will be set up, there are public hearings, etc. Council
will vote on whether to submit recommendation to Parliament.
 The Council can only recommend removal or no removal and no other potential sanction.
 There are between 150 and 200 complaints a year.
 There is issue as to whether Canadian Judicial Council has authority to reprimand. It is not
foreseen in CA or Judges Act. [In Quebec, reprimands are permissible i.e. suspension w/o pay].
 Some people argue that this all or nothing approach is wrong since a range of conduct
deserves a range of sanctions.
 Lamer J. says that increasing the range of possible sanctions might run the risk of
inhibiting at least some judges from making the sometimes unpopular rulings that all
judges are required from time to time to make (p. 254).
 Reprimands are counter intuitive because they create lame ducks; judges who
have had their authority challenged and their ability to perform their jobs
significantly challenged.
 Since 1971, there has been one instance where recommendation to remove was made (Berger
Affair). But judge resigned. He had made outrageous comment during a trial.
 The highest profile case in recent years involved Justice Boilard of the QC SC – a real
hothead. He was supposed to hear the Hell’s Angels Mega Trial. During the trial, he was sent a
letter by the council pursuant to his behaviour in another matter (p.234). Note that the council’s
only power is to recommend that parliament remove him (their power is all or nothing and the
reason is that you don’t want to compromise the judge’s authority). Notwithstanding that, a
practice has developed whereby the council will reprimand and criticize judges that it does not
recommend removal for. That’s what happened to Boilard – he got his wrist slapped.
Unfortunately, the letter was leaked to a newspaper. Boilard, humiliated by this letter, felt he had
lost the moral authority to hear this trial because his abilities had been called into question by the
council so he stepped down from the trial. The trial had to restart. A 2nd complaint was made
against him by the AG of Quebec saying that he shouldn’t have stepped down. There were 2
outcomes (p.235): 1) the council modified its rules so that before issuing a reprimand, they would
consult with the CJ of the given jurisdiction to verify that the timing won’t be problematic and 2)
the complaint against Boillard was dismissed – he couldn’t be blamed for stepping down.
 Grey wrote an article suggesting that it is not appropriate to remove a judge from the bench
for inappropriate remark. We should only remove them if there is a real prejudice caused or
corruption or something really damaging their judicial integrity. The appeals process will clean
up the problems of inappropriate remarks (p.237).
 Lamer wrote that the current process works and rejects any notion of intermediate sanctions
because they are harmful to the judicial process. All or nothing discipline works (p.238)
 There is a balance: Don’t want judges to be too easily fired (judicial independence). Don’t
want to sanction either, because:
58
1. Don’t want to interfere with ability to judge; and
2. People will not respect judge.
But want to be able to deal with cases where it is required.
 What do you do with judges who say stupid things? If it can be seen as an indication of
something more serious (the way he thinks), start thinking about removing him as judge.
Otherwise, should we give him slap on wrist, or would that create more problems (lame-duck
judges)?
 Don’t forget: There is also appeal system if judge renders wrong decision.
Provincially Appointed Judges
 We’ll focus on Quebec (Court of Quebec). In Ontario, there are no provincially appointed
judges on civil matters.
 Provincial judges are not protected by s. 99 of the Constitution Act.
 S. 92.1 Court of Justice Act (QC): is the statutory equivalent of s. 99 (retirement at 70) –
S.86 provides for appointment during good behaviour.
 Is legislation good enough to create independent and impartial tribunal?
 Since 1884, legislation required joint address of NA and Legislative Council (which was
abolished) to remove a judge.
 In 1941, that power was taken away from the legislature and given to the CA – at the end of
the day, the Minister of Justice needs to have the CA recommend removal – if they recommend
removal, the minister of justice can fire the judge himself.
 Hamilton thinks it makes sense to have the courts deal with disciplinary matters rather than
parliament – you avoid any potential conflict.
 In 1978, additional level added to process. Conseil de la magistrature was added (like
Canadian Judicial Council). Body made up of judges (Chief Justice of Court of Quebec, 5
associate chief justices of Court of Quebec, 4 judges of municipal court, 2 members of Bar, 2
members of public). Conseil has jurisdiction with respect to 2 issues (S.93.1 of the QC Courts of
Justice Act):
1. Is judge under permanent disability which prevents him from exercising duties of office?
Minister will ask Conseil to conduct inquiry. There is 4-step process:
1. Committee appointed by Conseil conducts investigation.
2. Committee reports to Conseil.
3. Conseil will vote as to whether judge will be removed.
4. It reports vote to Minister of Justice. Then Minister, if he decides to, makes
application to Court of Appeal to remove judge.
2. Impropriety. In Quebec, Conseil has adopted a Code of Conduct for judges: Judicial
Code of Ethics (p.239). Where there is allegation that judge has breached provision,
complaint will be made to Conseil.
 If a judge is accused of a breach of this code, it is investigated by the conseil which reports its
findings to the minister of justice. If the complaint is made by the AG, there is an obligation to
investigate but not if the complaint comes from anybody else (like the Canadian Judicial
Council).
 Removal: s. 279 courts of justice act (p.240): if the report of the inquiry establishes that the
complaint is justified, the council, according to the recommendations of the report of the inquiry,
(a) reprimands the judge; or (b) recommends that the Minister of Justice and Attorney
General file a motion with the Court of Appeal in accordance with section 95.
 s. 95: The Government may remove a judge only upon a report of the Court of Appeal
made after inquiry at the request of the Minister of Justice (p.240).
59
 Note how unlike at the federal level, here, reprimand is statutorily provided for.
 If Conseil recommends removal of judge, Minister of Justice has right to file motion with
CA. Minister cannot apply to have judge removed unless Conseil has so recommended. The CA
has the final decision.
Ruffo v. Conseil de la magistrature et al. [1995], Civil Law, p. 241
Facts:
 Ruffo is a judge of the Court of Quebec Youth Division in St. Jerome.
 She made many public statements about cases pending before courts. On two instances,
where a child was brought before her, she ordered that child appear before Minister’s office. The
Director of Youth Protection filed 58 complaints.
 Conseil maintained 4 complaints and issued a reprimand. She didn’t take reprimand well,
made more public comments against Conseil.
 Then Chief Justice laid further complaint
 She made motion to set aside proceedings alleging that since the Chief Justice is the head of
Conseil and has power over other judges of Court of Quebec, she cannot get a fair hearing [i.e.
she felt that she couldn’t get a fair trial because the Conseil’s “boss” was the complainant].
 Chief Justice responded that he would not be involved in process, and that he does not have
power over fellow judges.
Issue:
Was there a reasonable apprehension of bias in the proceedings?
Held:
No.
Ratio:
 Under these circumstances, this was workable arrangement.
 There are enough safeguards in place for this to work.
Notes:
 Ultimately, she was reprimanded again.
 A year ago, there were further complaints by Director and a further reprimand. She was
transferred from St. Jerome to Longeuil by Chief Justice.
Therien v. Minister of Justice et al. [2001], Civil Law, p. 242
Facts:
 Therrien applied to become a judge of the Court of Quebec 4 times.
 Disclosed that he had been convicted of an offence in connection with October crisis, for
which he was subsequently pardoned. Committee concluded hat he was not apt to become judge
each time.
 The next time there was an opening, he applied, and said he did not have a criminal
conviction. Committee concluded that he was apt, and was appointed to bench.
 Story broke immediately after appointment. Minister asked Conseil to conduct inquiry as to
fitness to remain judge, given (1) conviction (2) failure to disclose.
 Conseil concluded that he ought to be removed.
 This was deliberate attempt to not disclose something that he knew to be relevant. Minister
agreed, and made motion to C.A. to remove him as judge.
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 Therrien made a variety of challenges: He argued that the minister of justice could not
delegate this function to CA and that the protection of judicial independence required removal
upon joint address of the houses of the legislature – essentially, he contested the constitutionality
of s.95 of the Courts of Justice Act.
Held:
 The SCC upheld S.95. holding that it is not constitutionally mandatory for provincial judges
to have the exact same safeguards as required by ss.97-100 of the Constitution.
 S.C.C. dismissed appeal. Confirmed removal as judge. Failure to disclose the fact that he
had been convicted and pardoned when he knew that it was relevant consideration renders him
unsuitable to be judge.
 Referred to Valente: He was accused of a driving offense in front of the CQ and he argued
that he could not be tried in front of the CQ because the protections of judicial independence were
not adequate. The SCC dismissed the argument and held that although the safeguards were not
identical to federal safeguards, that they were sufficient.
POINT: s. 95 of the Courts of Justice Act is constitutional.
Note:
 Legislation creating the TAQ was held not to be in accordance with judicial independence.
The law provided for a 5 year renewable term rather than holding position during good behaviour.
The CA found that it wasn’t independent and impartial because judges shouldn’t have to worry
about keeping their jobs every 5 years.
II. Salaries
Federally Appointed Judges
 S. 100 of the Constitution: (pg. 70 CB): Salaries, allowances and pensions…shall be fixed
and provided by Parliament.
o This is modern drafting of 2nd branch of Act of Settlement 1701
 Parliament set out mechanism in Judges Act, which sets out salary for each court.
 There is annual adjustment for inflation (s.25).
 There are periodic inquiries. Every 3 years, independent commission is appointed to review
salaries of each federally appointed judge based on market conditions, etc. Then it makes
recommendation to Parliament (s.26).
R. v. Beauregard [1985] p. 256
Facts:
 The Feds changed the judges’ pension plan from non-contributory to contributory.
 Beauregard was the youngest judge and therefore, the most hurt by this change.
 He challenged the constitutional validity of this new pension scheme because requiring
judicial contributions to pensions reduced their salary.
 He alleged that this was undue influence by Parliament into salary, and taking away from
independence.
Held:
 Upheld validity.
 The SCC shat on this saying that virtually all pension plans are contributory and that this was
not a colourable attempt to reduce his salary.
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 There are federally appointed judges sitting in provincially operated courthouses. So this
dispute can come up between judge and province.
Bisson v. AG Quebec [1993], Civil Law, p. 257
Facts:
 Quebec decided to charge parking fee ($100/month) for parking at court house.
 Judges applied for injunction, arguing that indoor parking is essential as a matter of security
and as such for province to charge judges is reduction of salaries and this is unconstitutional since
Parliament is the only one with authority to set the salary of the judges.
Held:
 Judges won.
 The awkward thing is that the CJ has to go the SC to get an injunction (back-scratching
problem – what judge would disagree with an injunction to prevent parking fees).
 The case was eventually settled out of court for a lesser parking fee.
 This is a very embarrassing case. The underlying principle is valid though and it is that
Federally appointed judges have their salaries set by parliament and the provinces should not be
able to take away any of that salary (ex: the province should not charge judges for office space at
the courthouse). The province cannot charge judges for something that is an essential part of
their function.
Provincially appointed judges
Reference re: Public Sector Pay Reduction Act (P.E.I.) [1997] p. 258
Facts:
In the mid-90’s, PEI, MB and AB, as a part of a general reduction of civil service salaries decided
to reduce the salaries of all provincial judges. This was not colourable and no judge was singled
out (across the board). The judges challenged the constitutional validity of the salary reduction.
Held (Lamer):
Lamer held 1) that the independence of provincially appointed judges is constitutionally protected
as an unwritten principle that can be understood from the protections of Federal judges and from
the preamble (similar in principle); 2) this constitutional protection includes security of salary; 3)
If provincially appointed judges have constitutionally protected financial security, provinces
cannot reduce judges salaries without there being safeguards in place to protect judicial
independence; 4) safeguards: the province must establish an independent, effective and objective
body and submit to that body any proposed changes or freezes of judges’ salaries and it must
convene that body every 3 to 5 years in order to review salaries in light of inflation; 5) the
legislature is not bound to these recommendations of the committee but the legislature must
provide reasons.
Principles governing the collective dimension of financial security:
1. Governments are free to reduce, increase, or freeze the salaries of provincial court
judges, either as part of an overall economic measure which affects the salaries of all or some
persons, or as part of a measure which is directed at provincial court judges as a class.
2. Provinces are under a constitutional obligation to establish bodies which are independent,
effective and objective. Any changes to or freezes in judicial remuneration require prior
62
recourse to the independent body, which will review the proposed reduction or increase to
remuneration. Any changes to or freezes in judicial remuneration made without prior recourse
to the independent body are unconstitutional.
3. In order to guard against the possibility that government inaction could be used as a means of
economic manipulation by allowing judges’ real wages to fall because of inflation and to
protect against he possibility that judicial salaries will fall below the adequate minimum
guaranteed, the commission must convene if a fixed period of time (3-5 years) has elapsed
since its last report in order to consider the adequacy of judges’ salaries in light of the
cost of living and other relevant factors.
4. The recommendations of the independent body are non-binding.
5. Under no circumstances is it permissible for the judiciary to engage in negotiations over
remuneration with the executive or representatives of the legislature.
 When committee met, it concluded that salaries be raised 16.4%. National Assembly
considered recommendation and rejected it, granted 4% increase. Judges sued…
La Conference des Juges de Quebec v. PG Quebec [2000] p. 259
Committee recommended 16.4% raise in salary of judges, National assembly rejected, said 4%
raise. In justifying the refusal to go with 16%, the National Assembly referred to the fact that
there was a non-contributory pension plan and that their their salaries were in line with QC senior
civil servants. CA reviewed National Assembly’s conclusions. Decided that reasons for rejecting
were inadequate. Ordered gov’t to give effect to recommendation.
 Administrative tribunal legislation provided that salaries would be fixed by regulation.
Judges salary would be based in part on performance. This is not adequate to protect judges’
independence
III. Administrative Independence
 Security of tenure and salary are 2 traditional grounds for determining independence. There
is also a 3rd ground: administrative independence: Is right of CJ to assign judges from one district
to another limited? There are 2 conflicting decisions from 1999:
Ruffo, see above
Facts: Judge was ultimately reassigned from St. Jerome to Longueil. Ruffo sued CJ, applied for
injunction to prevent transfer.
CJ made motion to dismiss. She argued that the CJ has no power to punish her and that if judges
are worried about being sent to another jurisdiction, it fucks with their independence.
SC dismissed her claim holding that it is the CJ’s job to administer the courts.
Reilly v. Alberta
He was a provincial court judge and the territory where he was sitting had a lot of aboriginals.
The CJ did not agree with his ideas about aboriginal justice. The CJ tried to transfer him to a
district with less aboriginals. Riley argue that the CJ was transferring him because he didn’t
agree with his decisions. His argument was supported by correspondence between him and the
CJ so he won and costs were ordered against the CJ on the basis of substantial indemnity.
 So notion of administrative independence is emerging as 3rd branch.
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3. Judicial Immunity
Can you sue a judge?
 Historically, SC judges (and not inferior court judges) have absolute immunity for what they
do in court (judicial function). A judge can be sued for what he does as a private citizen.
Sometimes, it’s difficult to draw the line.
Morier v. Rivard [1985] p. 261
Facts:
 Involved law suit against police commission.
 Police commissioner was conducting an inquiry. The legislation setting up the commission
entitled the commissioners to the same immunity as Superior Court judges.
 Certain individuals instituted an action against the commission on the grounds that the report
issued was wrong and that it had contravened rule of justice in conducting the inquiry.
Held:
 Police commissioners were entitled to immunity because they had jurisdiction to conduct
inquiry and submit report.
 Anything within that context is entitled to absolute immunity. i.e., if judge does or says
something while wearing robe, protected.
 Can act outside your jurisdiction as long as you honestly believed you were within your
jurisdiction.
Dissent:
 The dissent suggests that a SC judge will lose immunity if he exceeds his jurisdiction. This
creates a problematic balance. The immunity doesn’t work if it is lost once jurisdiction is
exceeded.
POINT: In virtue of this information, we can also see that Superior Court judges are also immune
from being sued even when act outside their jurisdiction (as long as acting as a judge)= absolute
immunity.
Royer v. Mignault [1988] p. 264
Facts:
 Action resulted from trial of Denis Lortie, the man that killed the MPs in the National
Assembly.
 The defence lawyer is taking action against the TJ because after the jury returned a guilty
verdict the lawyer told TJ he wanted to call criminologists to establish that compulsory life
sentence without parole was cruel and unusual punishment and  unconstitutional.
 Judge then made comments about the competency of counsel, telling Lortie he should've
hired an expert criminal lawyer instead.
 Lawyer sued the judge for defamation claiming that he was trying to hide behind the
"absolute immunity" defence.
Issue:
Can the judge be sued?
Held:
No.
64
Ratio:
 Cited Morier v. Rivard and dismissed action at the preliminary stage. As long as judge
honestly believes he is within his particular jurisdiction, he isn't liable.
 Superior Court judges are protected by absolute immunity for anything they do in the
performance of their job.
 Judges have absolute immunity except where they step out of their particular scope of job,
i.e. hitting a witness.
 Notes that the purpose of the immunity is not to protect the personal interests of judges, rather
to protect the public interest in an independent and impartial justice system.
POINT: Morier is confirmed: the judge is not liable for anything in the context of the trial.
 In Quebec, for lower courts, there is Magistrates Privileges Act (p.267), which gives judge of
inferior courts same protection as Sup. Ct. judges.
Judicial immunity from testifying
 Judges cannot be called to testify regarding the reasons for a decision
 But, they can be called to testify in other instances, i.e. witness to a car accident.
MacKeigan v. Hickman [1989], p. 268
Facts:
 Donald Marshall was convicted of murder in 1971.
 In 1989, new evidence was found about his case, so the Federal Justice Minister referred the
matter to the NS CA which quashed the conviction – BUT said that Marshall’s lies to the police
had exacerbated the whole thing.
 The NS gov’t then set up the Royal Commission to find out what had gone wrong that
resulted in the conviction of an innocent person. The commission asked the court of appeal to
testify – wanted to ask why the AG from 1971 was on the bench for the case, what evidence had
been considered, why statements had been made regarding Marshall’s own involvement /
responsibility - but they refused.
 Subpoenas were issued and judges made motion to quash the subpoenas alleging that can't
testify with respect to the execution of their duties/judicial functions.
Issue:
Can the judges be forced to testify?
Held:
No.
Ratio:
 Judges cannot be compelled to testify re matters that take place within the
courtroom/jurisdiction.
 This is largely as a result of the independence of the judiciary.
 The judges only speak through their judgments.
4. Recusation
65
 So, can’t fire them, reduce their salary, sue them, or make them testify. Lastly, there is notion
of recusation.
 This has to do with issue of: What do you do if you are not satisfied that judge will deal with
your issue fairly? See articles 234, 235 CCP
 s. 234 CCP: a judge may be recused, in particular,
(1) If the judge is the spouse of or related to one of the parties;
(2) If the judge is a party to an action involving a similar question;
(3) If the judge has given advice on the matter in dispute, acted as lawyer, arbitrator or has
otherwise given his opinion ex-judicially on the matter;
(4) If the judge is directly interested ;
(5) If there is mortal enmity between him and any of the parties, or if the judge has made
threats against any of the parties since the start of the action or w/in 6 months of it starting;
(6) If the judge is the legal representative, mandatary or administrator of the property of a
party to the suit or if the judge is a successor or donee of one of the parties.
(7) If the judge is a member of an association, partnership or legal person which is a party;
(8) If the judge has any interest in favouring any of the parties;
(9) If the judge is the spouse of or is related or allied to the attorney or counsel or to the
partner of any of them directly or in the collateral line in the second degree;
(10) If there is a reasonable cause to fear that the judge will not be impartial.
Note – 234(10) is new. It was added and reflects the common law standpoint.
 s. 235 CCP: A judge is disqualified if he or his spouse is interested in the action
 234, 235 deals with relation to parties, having interest in outcome, or having prejudged case.
At common law, there is 1 ground: reasonable apprehension of bias. Is there a reasonable
apprehension of bias that judge will not render justice fairly as between these two parties?
R. v. Sussex Justices [1928] p. 271
Facts:
 The applicant was convicted on a charge of dangerous driving when he his W with his car.
 At the hearing, the acting clerk to the justices was a member of a firm who was acting for W.
 The applicant said this was unfair (note that the clerk did nothing on the file).
Issue:
Was there an injustice?
Held:
Yes.
Ratio:
 It is fundamental that justice should not only be done, but that it should also be manifestly
seen to be done; the question was whether he was so related to the case by reason of the civil
action as to be unfit to act for the justices in the criminal proceedings and the answer depended
not on what was actually done but on what might appear to be done.
 He might have created a suspicion that there had been an improper interference with the
course of justice and therefore the conviction of the applicant must be quashed.
POINT: The question is not only what was done but on what might appear to be done – you
cannot raise the suspicion of any bias.
P.S.-M v. A.J.-L.C. [1998], Civil Law, p. 272
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Issue:
Are ss. 234, 235 exhaustive?
Held:
No.
Ratio:
Reasonable apprehension of bias is a ground for recusation in addition to the enumerated list in
234.
Test: the apprehension must be:
(a) reasonable that is, there must be an apprehension that is both logical (i.e. inferred on
substantial grounds,) and objective (i.e. would be shared by the person described in (b)) it cannot
be slight, frivolous or isolated apprehensions.
(b) held be a person who is: (1) right-minded and not excessively sensitive or scrupulous, or
anxious or naturally worried, or quick to accuse; (2) well-informed because he has realistically
thought through the matter through, devoid of all emotion; the request for disqualification cannot
be impulsive; and
(c) be based on substantial grounds.
 Grounds relied on: (i) respondent’s complaint to the Quebec Judicial Council; (ii) the
complaint to the council by the psychologist; (iii) utterances during trial saying it wouldn’t be so
bad if he wasn’t on this case; (iv) article in La Presse whereby author felt judge’s animosity
towards husband; and (v) a similar remark on a television program.
 Notes that the seriousness of the grounds on which the apprehension of bias is based
must be assessed in light of the other conditions that must exist if such apprehension is to be
admitted as a valid case for disqualification.
 These include, for example, the test consisting of asking :what would an informed person,
viewing the matter realistically and having thought the matter through – conclude?”
 So, considers, his oath of office; expertise; ambiguous nature of his words; impressive
number of judgements delivered by the judge; the respondent’s repeated changes of lawyers – he
is difficult to satisfy; the length of the proceedings; his unbiased approach to dealings in the trial
thus far…
 The right minded person, the one who is to experience the reasonable apprehension of bias,
would conclude that the mere presence of complaints filed with the Canadian Judicial Council by
the respondent and his psychologist expert is not sufficient to justify a request for disqualification
in this case.
POINT: Reasonable apprehension of bias is a ground for recusation (note, now included in
s. 234(10).
 In general, judges are sensitive to these kinds of issues and the most likely outcome is that a
judge will spot a problem and step away from the case asap.
 If judge doesn’t say anything, the easiest thing to do is to postpone case. Come back another
day and be heard by another judge.
 Alternatively, can say nothing, and hope that everything works out. But this is dangerous
since:
1. If you know that judge has knowledge that would work in your favour, to not deal with it
upfront is dangerous, because if you win, other party might appeal and you will lose. See
Sussex Justices case.
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2. If judge is biased against you, and you lose, CA may take position that if you knew and
did nothing, you waived your right to appeal on this ground.
 The best approach is to bring the issue to the judge’s attention:
 236(1) CCP: A judge who is aware of a ground of recusation to which he is liable must,
without waiting until it is invoked, declare it in a writing filed in the record and so inform the
chief judge.
 236(2) CCP: likewise, a party who is aware of a ground of recusation against the judge must
declare it without delay in a writing filed in the record and notify a copy to the judge and other
parties.
 Formal procedure for recusation:
a. s. 236(2): make a formal written application.
b. The judge must respond in written form.
c. Next decide if want to go forward.
Note that it is risky since if you lose, you are stuck with a very angry judge (P.S.-M). In P.S.M,
the husband raised grounds for recusation so the husband made a formal motion asking for
recusation. Art. 238 provides that a judge must provide a written response to a motion for
recusation. One of the grounds upon which the husband asked for the judge to be recused is
because the husband made a complaint to the judicial council which was dismissed – this ground
was dismissed. There was also a newspaper report in which the reporter said that the judge was
angry at the husband and a television report which put words in the judge’s mouth. The CA said
that these were not valid grounds of recusation. He got stuck with the judge he was trying to have
recused and his standing in the case likely suffered.

So, have delicate decisions to make. If press issue forward, antagonize judge further, and
blow any chance of judge ruling in your favour VERSUS continuing to put up with situation and
hope to ultimately file appeal.
 Another issue that comes up would be with how to deal with an issue where a judge has a
direct interest in the outcome of the litigation (i.e. Beauregard or Bisson). A motion to recuse in
such a situation is usually dismissed on the grounds of necessity – a judge cannot sue if no judge
can adjudicate. A second argument is more procedural and it is that the AG has the power to
refer a question directly to the CA and if the AG was really concerned about SC bias in one of
these “judge salary” cases, they could have referred the case directly to the CA. The judicial
salary cases are an exception to the normal principles of recusation but the differences are
justified by necessity.
 Another problematic area is the class action. A class action is often defined in such a way
that the judge hearing the case is a part of the class. Ex: Visa’s exchange rate allegedly violates
the CPA. The judge hearing this case likely has a Visa and has likely used it in the US. He will
likely have an interest in the amount claimed in the lawsuit. Under art. 1001 in the CCP, the CJ
has the power to designate which judge will hear the class action and the CJ can make this
designation in the interests of justice notwithstanding arts. 234-5 (the apparent conflict).
 The judge’s personal background is also an issue in recusation – Locabail. This problem
comes up in a case where you have a charter case where the judge is a member of the group
who’s rights are at stake. The problem is that consistency will make it impossible for anybody to
hear the case. The UK CA held that they could not conceive of a sound basis of objection based
on the judge’s background, social position, wealth and so forth. As far as the UK courts are
concerned, the judge’s personal characteristics should not be relevant in determining whether the
judge should hear the case. By contrast, a real danger of bias if the judge were closely acquainted
with any member of the public involved in the case or if there was real ground to doubt the
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judge’s ability to make an objective judgment on the issue before the court. A “backroundbased” objection to the judge’s impartiality has to be strongly backed up in fact.
Locabail v. Bayfield Properties Ltd. and another [2000] p.276
 It would be dangerous and futile to attempt to define or list the factors which may or may not
give rise to a real danger of bias.
 We cannot conceive of circumstances in which an objection could be soundly based on the
religion, ethnic or national origin, gender, age, class, means or sexual orientation of the judge.
 Nor, at any rate ordinarily, could an objection be soundly based on the judge’s social or
educational or service or employment background or history, not that of any member of the
judge’s family; or previous political associations; or membership of social or sporting or
charitable bodies; or Masonic associations….
5. Judicial Powers
Judges have the powers that are expressly granted to them by statute in addition to certain
inherent powers (p.277).
a. Contempt of court
 Civil contempt is defined (278) in the Canadian judicial council’s guidelines and there are 4
categories:
o Interfering w/judicial proceedings.
o Improper criticism of a court or judge.
o Disobedience of orders or judgments.
o Obstruction of process.
 It is also defined in art. 50 CCP: Anyone is guilty of contempt of court who disobeys any
process or order of the court or of a judge thereof, or who acts in such a way as to interfere with
the orderly administration of justice, or to impair the authority or dignity of the court.
 Hamilton: there are 2 types of contempt – not following the court’s orders by act or omission
and disrupting the workings of the court.
 Criminal contempt of court (s. 9 of the Criminal Code) requires public defiance of the court’s
order designed to lessen the public’s esteem for the courts. It is like aggravated civil contempt.
 Obstructing the Process of the Courts:
Ouellet v. R. [1976], Civil Law, p. 280
Facts:
After losing, the following comments were made by a Minister, “I will ask to launch an appeal. I
find this judgment completely unacceptable, I think it is a silly decision. I cannot understand how
a judge who is sane could give such a verdict. It is a complete shock and I find it a complete
disgrace.”
Issue:
Contempt?
Held:
Yes.
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Ratio:
Minister found guilty of contempt, ordered to pay $500 in costs and to apologize.
Apology quashed on appeal, but conviction upheld.
R. v. Chippeway [1993] p. 284
Facts:
Lawyer did not appear in court when he was scheduled to do so as he was double-booked.
Issue:
Contempt?
Held:
Yes.
Ratio:
 Not every failure by counsel to appear in court will amount to contempt. Where adequate
explanation is advanced, counsel should not be convicted for contempt of court.
 The absence of counsel in scheduled proceedings can constitute contempt where the evidence
satisfies the court, beyond a reasonable doubt, that the lawyer’s failure to appear
demonstrated a decided indifference to his obligation to the court and to his client.
 Such conduct showed indifference to his professional obligations both to his client and to
the court.
 Here, found to be contempt.
 The other type of contempt (obstruction of process) is behaviour by participants or people in
the courtroom. Ex: the lawyer insists on asking questions that the judge held inadmissible or an
observer calls a witness a liar.
 For disobeying court order, usually occurs in context of injunctions. Seen often in labour
manners, where court orders to stop picketing, for example.
Everywoman’s Health Center Society v. Bridges [1988] p. 285
Facts:
Defendants were anti-abortion activists with knowledge that a restraining order had been made in
respect of access to an abortion clinic.
Nonetheless, the defendants stood in front of the clinic and held two signs that had provocative
and emotionally disturbing messages on them.
Issue:
Contempt?
Held:
Yes.
Ratio:
 They violated the watching and besetting term of the injunction (court order).
 Because the court was not satisfied beyond a reasonable doubt that the contempt identified
was open and public or that any of the accused intended, knew or was reckless about whether the
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conduct would tend to depreciate the authority of the court, they were guilty of civil contempt and
not criminal contempt.
POINT: Deliberately disobeying an order of the court will be considered contempt of court.
 This is controversial in family law context, where there are court orders to pay support.
 The failure to obey an order to pay a sum of money is more problematic. We don’t have
debtor’s prisons any more so we seize property and assets. The question is whether a deadbeat
dad can be charged with contempt. The answers in QC and ON are different.
Droit de la Famille 3579 [2000] p. 281
Facts:
 Father failed to pay child support to his daughter since 1983. The parties were divorced in
1986.
 The child, who was currently 19 years of age, always lived with the mother.
 The relationship between the parents was strained and all disputes were submitted to the
courts.
 Various interim judgments were pronounced, as well as corollary relief, which condemned
the father to pay child support. The arrears totalled $31,107.
 This is an exceptional case because the husband had disobeyed court orders for 17 years that
he simply never paid what he was ordered to pay.
Issue:
Can you use contempt of court to force payment? Can you exceed CCP 51?
Held:
Yes.
Ratio:
 The court said that without some drastic measure, the husband will never pay. The
deadbeat’s continuous breach of court orders constituted contempt of court.
 The father was sentenced to a 30 days imprisonment (unless he pays $10,000 )and 50 hours
of community work (unless he pays another $10,000).
 The court was not limited to the sanctions provided under section 51 of the Code of Civil
Procedure.
 The power to impose a punishment was among the inherent powers of the Superior
court.
 The Superior court had the power to render any coercive measures that were necessary in
order to ensure the respect of its orders.
 POINT: Court not limited to sanctions in CCP 51 ($5,000 and 1 year imprisonment).
The power is inherent an in no way limited by s. 51.
 CPP 51: Except where otherwise provided, anyone who is guilty of contempt of court is
liable to a fine not exceeding $5000 or to imprisonment for a period not exceeding one year.
Re Mills and Martin [1990] p.283
Facts:
Respondent was in breach of an interim order requiring him to make monthly payments on a joint
bank loan.
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Issue:
Can he be held in contempt?
Held:
No.
Ratio:
 With few exceptions, orders for the payment of money are not enforceable by way of the
contempt process.
 The court must exercise its jurisdiction in a manner consistent with s. 60.11(1) of the Rules of
Civil Procedure which provides: a contempt order to enforce an order requiring a person to do an
act, other than the payment of money, or to abstain from doing an act, may be obtained only on
motion to a judge in the proceeding in which the order to be enforced was made.
 It is obvious that the payment provision of the order sought to be enforced is an order for the
payment of money and should not be the subject matter of a contempt proceeding.
POINT: unlike Quebec, Ontario elected to not stray from the codification of contempt.
 In Ontario, R. 60.11(1): A contempt order to enforce an order requiring a person to do an act,
other than paying of money, or to abstain from doing an act, may be obtained only on motion to a
judge in the proceeding in which the order to be enforced was made.
 So contempt option is a possibility in Quebec for orders regarding paying of money. But it is
exceptional.
QUEBEC
 Articles 49-54 CCP
 Contempt can occur in 1 of 2 places: in front of judge or outside judge’s presence.
 Where it occurs in judge’s presence, CCP 52: Judge can call on that person to justify his
behaviour (on the spot). If that person cannot, judge can find him guilty on the spot and impose a
fine or send person off to jail.
 When it is not in judge’s presence, judge issues a special rule, which orders person to come to
court and explain why he or she should not be condemned for contempt of court. Judge can issue
special rule on its own if it has knowledge of behaviour. Alternatively, other party to litigation
will make a motion to court asking court to issue special rule CCP 53. [Same as R. 60.11 in
Ontario].
 Like criminal proceeding: There is criminal standard (53.1). Also, respondent may not be
compelled to testify.
 Judge ends up acting like accuser, judge and jury.
 Punishment (art. 51): Fine not exceeding $5000 or imprisonment not exceeding 1 year.
Imprisonment may be repeatedly inflicted until person condemned obeys.
ONTARIO
R. 60.11 (partial codification).
Balance of rules are common law rules.
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Criminal contempt requires public defiance of court order calculated to lessen societal respect for
courts. This is under Criminal Code.
b. Parens patriae
 Means “parent of the country”. Refers to role of sovereign as guardian of persons under legal
disability.
 Originally belonged to the sovereigns. Eventually delegated to Lord Chancellor, who
eventually delegated to Courts of Chancery.
 Role given to Superior Court in common law provinces.
Re Eve [1986], Common Law, p. 285
Facts:
 Sterilization of a mentally retarded woman.
 Both government authorities and individuals acting on behalf of the woman agreed that it
would be best for her to be sterilized.
 Typically, where 2 parties agree, the judge will accept what the parties are saying and render
a judgment at their request. But, in the context of parens patriae it is not so simple. The court can
render a different decision, notwithstanding representation of the parties.
Issue:
Does the court have jurisdiction using its parens patriae jurisdiction?
Held:
Yes.
Ratio:
 The court’s discretion under its parens patriae jurisdiction must be exercised for the
benefit of the mentally retarded person, not for the benefit of others.
 The courts should never authorize a non-therapeutic sterilization of a mentally retarded
person under its parens patriae jurisdiction.
 Court analyzed parens patriae power which it said was a broad jurisdiction including
custody questions, protection of property, health issues including blood transfusions re child
Jehovah’s witnesses, upbringing of kids (“protection against harmful associations.”)
 The court has the right to examine whether the proposed transaction was in the best interests
of the person with a disability.
POINT: Court has broad powers.
 There is academic debate in Quebec as to whether Quebec Superior Court can exercise this
power.
DS v. BW [1996] 2 CR 108
SCC: The Superior Court of Quebec does not have this power, because Courts of Chancery never
existed in Quebec. So power in Quebec resides with Lt. Governor. The inherent power of QC
Courts from art. 46 CCP can be used like the Parens patriae power.
 CCP 46: The courts and judges have all the powers necessary for the exercise of their
jurisdiction.
o General powers are conferred on the Superior Court by this section.
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c. General inherent power
 Superior courts have residual jurisdiction to grant appropriate remedy where Code or
common law is silent on the question.
 In Quebec, arts. 2, 20 and 46 CCP:
o CCP 2: …The provisions of this Code must be interpreted the one by the other, and, so
far as possible, in such a way as to facilitate rather than to delay or to end prematurely
the normal advancement of cases.
o CPP 20: whenever this Code contains no provision for exercising any right, any
proceeding may be adopted which is not inconsistent with this Code or with some other
provision of law.
o CPP 46: The courts and judges have all the powers necessary for the exercise of their
jurisdiction. They may…make such orders as are appropriate to cover cases where no
specific remedy is provided by law.
 If you are making a motion under arts. 2, 20 and 46, it is seen as a Hail-Mary motion.
 Usually, the inherent powers are used in the bankruptcy context. In the context of a CCAA
reorganization, the courts have held that the inherent powers gives them the flexibility to allow all
kinds of approaches to financing that are not allowed at law.
Kolomeir v. Forget [1972] p. 290
Facts:
 Defendant was an accused in criminal proceedings and defendant in civil proceedings
flowing from same events.
 CCP does not provide for which goes first, but in criminal context there is right to remain
silent.
Issue:
Even though not provided for in the CCP, can they postpone the civil trial until criminal trial is
completed?
Held:
Yes.
Ratio:
 If civil case proceeds, defendant will be compelled to speak, and this will breach his rights.
So suspend this case until criminal case resolved (under CCP 2, 20, 46).
Calvi Article p. 291
 Proceedings were instituted against his family to find stolen assets. Article refers to orders
made at common law: Anton Piller order and Mareva injunction.
 Anton Piller order: A civil search and seizure. Enable plaintiff to enter defendant’s premises
and seize things that may constitute evidence in a civil case.
 Mareva: Common law equivalent of seizure before judgment. Cannot dispose assets, remove
assets from jurisdiction.
74
 In Calvi, court took it one step further. These orders were being served on a whole variety of
parties. To render it effective, there was order to prevent anyone with knowledge about
seizures from talking to their lawyers.
 Strange order but some say that although drastic, were based on the inherent jurisdiction of
the court.
POINT: Inherent powers have broad range.
 s. 24 Charter, s. 49 Quebec Charter, pg. 96: Gives courts very broad power.
o Courts have not fully defined what remedies might be in all circumstances.
VI. The Organization of the Courts
A. Trial Courts
 Notion of trial court or court of first instance or court of original jurisdiction: Designates
court which will hear and dispose of case first and dispose of it on its merits first.
 There are 2 types of courts of first instance: Superior or Inferior
o Superior: Court of original general jurisdiction (S.96). Has jurisdiction over any
case unless jurisdiction is excluded by something. Another feature of the SC’s in
Canada is that they are the successors to the UK high courts and they enjoy the
same powers.
o Inferior: Court of specialized statutory jurisdiction. Has only powers and
jurisdiction given by statute.
 In Canada, statutory carve outs can take 1 of 2 forms:
1. Provincial legislature can give jurisdiction to provincial inferior court. Where provincial
legislature has sought to give jurisdiction to provincial inferior court, there is s. 96 issue.
If province seeks to give too much jurisdiction, end up with situation where provincially
appointed judge is deciding question that should be decided by federally appointed judge.
So power to expand is limited based on situation in 1867.
Séminaire de Chicoutimi v. The City of Chicoutimi [1973], Civil Law, p. 11
Ask yourself – in 1867 did this jurisdiction belong to a s. 96 judge? If yes, you cannot give that
power to a provincial judge. For example, you cannot say that the court of Quebec (provincial)
will have jurisdiction over all cases below $100,000,000. Doing this would effectively usurp
the powers of federal judges. The question is whether the jurisdiction conferred upon the
inferior court is consistent with the jurisdiction that the inferior courts had in 1867. It is an
exercise in historical analogy.
2. Federal court. Under s. 101 of the Constitution, can provide for courts for better
administration of laws of Canada. Parliament can only give jurisdiction if it is for better
administration of laws of Canada.
 Granting of jurisdiction to federal court or provincial inferior court can be concurrent or
exclusive. Concurrent: have option to sue in superior court or other court. Exclusive: jurisdiction
of superior court is excluded.
 Must understand constitutional role of provincial superior courts.
A.G. Canada v. LSBC [1982] p. 10
Facts:
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 There was an action taken to a B.C. Supreme Court for a declaration that the Combines
Investigation Act did not apply to the Law Society of B.C. or that if it did apply it was ultra vires.
 The A.G. made a motion to dismiss, saying that this debate should be taken in Federal Court
because it was dealing with federal legislation.
Issue:
Does the superior court have jurisdiction?
Held:
Yes.
Ratio:
 Superior courts are not provincial courts per se. Although they are organized by the province,
the judges who sit in them are federally appointed and so they cross the boundary b/w federal and
provincial.
 These courts have the power to declare whether a federal statute is ultra vires – they have
jurisdiction in all matters.
 If parliament wanted to carve out this power for the FC’s, Estey argues that this sort of law
would be invalid since it would not be for the better administration of the laws of Canada. Estey
interprets the FC Act as not removing the SC’s jurisdiction to examine the constitutional validity
of Federal statutes. The FC’s can have concurrent jurisdiction to review the validity of Federal
laws.
 This power cannot exclusively be given to the federal court.
 Not having that power would be unconstitutional.
B. Appeal Courts - Generally
 A Court of Appeal is any court which hears an appeal from a judgment of trial court or lower
court of appeal (in ON, there are 2 CA’s).
 Courts of appeal can have 2 different roles: Either it can review decision of lower court to
ensure that justice is rendered (usually, role of 1st level appeal court) or can review decision of
lower court to ensure that legal principles are correct (usually role of higher appeal court or SCC).
 There are 2 different types of judgment from which an appeal might lie:
1. Final judgments (puts an end to litigation between parties, generally rendered after trial (unless
there is motion to dismiss that is granted – this is final judgment)).
2. Interlocutory judgment: Judgment rendered during lawsuit but before final judgment. E.g.,
objections to evidence, permission to amend, motion for recusation, etc.
 The rules are different with the kinds of judgment. Appeals of final judgments are less
restricted than appeals of interlocutory judgments.
 There are 2 different procedural routes that an appeal can follow:
1. Appeals as of right: Dissatisfied party has right to have appeal heard.
2. Appeal with leave: Dissatisfied party must ask CA for permission to bring an appeal.
There are 4 types of Courts of Appeal:
1. Quebec C.A.
2. Divisional Court (Ontario)
3. Ontario C.A.
4. Federal C.A.
 May go to any of these courts either on Questions of law or fact or mixed law and fact.
76
 Question of Fact: The court concludes that an auditor made mistakes, which were negligent.
If you allege that the judge’s finding of fact is wrong (the auditor made no mistake), it is a
question of fact.
 Question of Law: The judge concludes that auditors owe a duty of care to creditors and you
think that is not the law.
 Mixed question: The auditor’s behaviour was negligent – mixed law and fact.
 Exception: In Ontario, since there are 2-level appeals, there is no appeal from Divisional
Court to the Ont. CA on a Question of fact alone (see s. 6(1)(a) of Courts of Justice Act). The
idea is that the appeal to the divisional court is the second kick at the can and parties should not
get a 3rd kick.
 Although appeals are allowed on questions of fact, an appeal is not the re-trial / re-hearing of
a case. C.A. will review transcripts – it does not re-hear witnesses. However, there are some
exceptions where the C.A. will hear new evidence.
1. Quebec: Art. 523 or 509 CCP (my notes say 523 but 509 makes sense), which is
discretionary. The C.A. may, permit a party to in exceptional circumstance, to adduce, in
such a manner as it directs, indispensable new evidence.”
 Evidence must be indispensable new evidence, This is a very high standard. It
means that the evidence must be such that it would change the outcome, and the
party bringing the new evidence must be able to explain why the evidence wasn't at
trial.
 Note, this occurs only in exceptional circumstances.
2. Ontario: s.134(4)(b) Courts of Justice Act which provides that the court may receive further
evidence in very exceptional circumstances: if evidence was unavailable at trial and if it is
practically conclusive on an issue before the court.
Practically conclusive: if the evidence is believed, it could reasonably, when taken with the other
evidence adduced at trial, be expected to have affected the result (changed it – altered the
judgment).
 Where judgment at trial is based on credibility of witnesses, CAs will not intervene.
 The CA’s function is to render the judgment that the trial judge ought to have rendered. In
some jurisdictions, the CA is more like a Cour de Cassation – they just send cases back for a new
trial. In Canada, CA’s can substitute their own judgment.
Thomas v. Radvak [1997] p. 62
 The appellant did not question the constitutional validity of s. 59(2)(a) at trial but tried to
challenge it as being contrary to s. 15(1) of the Charter as an alternative to the primary grounds
of appeal.
 Holds that the Charter cannot be entertained at this level without the matter having passed
through the trial process first.
 The Charter argument should not be heard for the first time on appeal.
POINT: C.A. will generally not consider an issue not raised at the trial level.
Joyal v. Construction Raymond Villeneuve Inc. [1987], Civil Law, p. 62
Facts:
 There was a demand from the Plaintiff vs. the Defendant and a cross-demand by Defendant
against the Plaintiff.
77
 The Trial Judge dismissed the first demand, but forgot to render judgment on the second
cross demand.
 The Defendant appealed saying cross-demand should have been granted.
Issue:
Can the Court hear the appeal?
Held:
No.
Ratio:
 Court of appeal rejected leave because it said that it had no jurisdiction.
 C.A. only deals with appeals from lower court decisions and here there was no decision on
this issue.
 Proper procedure for this: Art. 475 CCP: By this method, a Trial J. can correct his decision
and once he does, then you can appeal.
POINT: a C.A. will only hear appeals from decisions of the lower court. An error in a lower
court judgment (actual error, not error in the law) will be rectified by CCP 475.
 CCP 475: A judgment in which there is an error in writing or calculation or any other
clerical error may be corrected by the judge or clerk who rendered it. A judgment which , by
obvious inadvertence, has granted more than was demanded or has omitted to adjudicate upon
part of the demand may also be so corrected.
Re Ward et al. and Worker’s Compensation Review Division [1997] p. 63
Facts:
 There was an appeal from Mr. Justice Barry’s decision which quashed a decision of the
Worker’s Compensation Review Division but that appeal was discontinued.
 Mr. Ward, the successful party would like to nevertheless continue with his cross appeal
because he feels that although he is in agreement with Mr. Justice Barry’s decision, the decision
should be affirmed on grounds other than those given by the court.
Issue:
Can he appeal?
Held:
No.
Ratio:
 There is no need to support the decision on other grounds.
 In light of the withdrawal, the decision of Mr. Justice Barry remains in place in any event.
 This does not afford a basis for appeal – where the relief sought is obtained on the basis of
acceptance by the original judge of argument “A”, but not on the basis of argument “B”, the
successful party will generally have no right to an appeal because he cannot complain of the
result.
POINT: If you do not have a complaint about the result, there is no reason to appeal it.
Common law right of appeal
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 CA’s are statutory, and have whatever jurisdiction that are given by statute, and only that
jurisdiction. Legislator can abolish CA’s.
Ecole de Chicoutimi
Court: Even where CA does not have jurisdiction to hear merits of appeal, the CA would have
power to quash decision rendered by a court which does not have jurisdiction.
Notes:
 Art. 33 CCP gives SC’s general power to supervise and review the work of lower courts. If
Court of Quebec renders a judgment where it does not have jurisdiction, and there is no statutory
right of appeal to CA, art. 33 would come into play. Can make application to SC.
 Problem: Where you have decision of SC which has exceeded jurisdiction. Art. 33 does not
give one SC judge power to quash another judge’s decision.
 Where SC exceeds jurisdiction, and there is no statutory right of appeal, can nevertheless
make motion to CA, and CA can quash decision (Ecole de Chicoutimi).
C. Court Structure in Quebec
Court of
Appeal
Art. 26, 29
Art. 26, 29
No appeal – Art. 984
Superior Court
Art. 31-33
Court of Quebec
Small Claims Court
Art. 34-36.2
Art. 953
Superior court
 In QC, the s.96 “superior court” is called the “Superior Court”.
 Art. 31 CCP: the Superior Court is the court of original general jurisdiction; it hears in first
instance every suit not assigned exclusively to another court by a specific provision of law.
Inferior court

Arts. 34-36.2 CCP: Inferior court is Court of Quebec.
 The CQ has existed here in one form or another since before confederation. There were at
least 4 inferior courts – the circuit court had jurisdiction over matters under $100 and over
municipal matters. There was also the commissioner’s court and the court of the justices of the
peace and the recorder’s court. In 1869, QC created the magistrate’s court and gave it jurisdiction
in civil matters worth $200 or less. Nobody contested this court under s.96 at that time. The
$200 value is now the benchmark for s.96 disputes.
 Arts. 22 and 37 CCP gives the Municipal Court authority over certain civil matters but their
jurisdiction comes from other laws. In reality, the MC has no jurisdiction in civil matters – only
in minor criminal matters.
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 After confederation, the inferior courts in Quebec were amalgamated into the magistrate’s
court. In 1963, QC increased the magistrate court’s jurisdiction to matters up to $500 - see Re
Quebec Magistrates Court Act
 Over the years, courts have been amalgamated. In 1965, only 1 inferior court: Provincial
court. Had jurisdiction in matters where amount at issue $1000 or less and in certain specialized
issues.
 In 1990, name of court was changed from Provincial Court to Court of Quebec.
 In 1995, jurisdiction was increased from $15 000 to $30 000.
 There is s. 96 constitutional issue here. Whenever jurisdiction broadened, reducing
jurisdiction of Superior Court. See chart on p.14.
 In 1963, issue was litigated. Jurisdiction increased from $200 to $500. Re Quebec
Magistrates Court Act: SCC: This amendment is valid. Looked at Consumer Price Index.
Tripled over period of time, so increasing monetary jurisdiction by a factor of 2 ½ was valid. The
SCC held that increasing monetary jurisdiction to keep up w/inflation is valid.
 For now, art. 34(1) gives the CQ jurisdiction over matters worth up to $70 000.
Subparagraph 2 and 3 also refer to contracts and leases worth up to $70 000.
 Court of Quebec has jurisdiction in civil matters where amount at issue is less than $70, 000,
and in certain specialized areas (municipal taxation, expropriation, appeals from provincial
administrative bodies).
 The $70 000 jurisdiction is now 30 times what its correct jurisdiction should be.
 Hamilton thinks that this is a significant constitutional issue. He thinks that the $70 000 limit
is not valid based on the Magistrate’s Court Reference. The issue, however, has never been
raised.
Small claims court
 Small claims court: This is not a separate court; it is part of Court of Quebec. Arts. 953 ff
CCP creates a special procedure for small claims in front of the CQ rather than a special small
claims court.
 CCP 953: The money claimed in an action involving a small claim, that is,
(a) A claim not exceeding $7,000, exclusive of interest,
(b) For a debt owed to a person, partnership or association in the name of and for
the account of the person, partnership or association.
May only be recovered before the courts pursuant to this book.
 The plaintiff must be either a natural person or a legal person with 5 or less employee
throughout the 12 months preceding the filing of the claims. This means that a bank making a
small claim has to use the regular CQ procedures.
 No lawyers involved. Court plays greater role.
 No formal exchange of pleadings, discovery. Much simpler procedure. Court helps parties
prepare proceedings.
 A claimant has to figure out whether or not they are suing in the SC, the CQ or the CQ with a
small claims procedure. In QC, the choice and the consequences of a wrong choice are
problematic.
 The question of where to sue is answered based on the default principle that you must sue in
the SC unless specific legislation puts you in the CQ (in articles 34 to 36.2).
 984 CCP: the judgment is final and without appeal. Actions involving small claims are not
subject to the superintending and reforming power of the Superior Court, except were there is
want or excess of jurisdiction.
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Thériault v. Cormier [2000] p. 15
Facts:
 The plaintiff was suing for $28,000 and interest and court costs (adding to $33,000 +).
 The plaintiff brought an action in the Court of Quebec and the defendant did not show up.
 The plaintiff was awarded a summary judgment and the plaintiff sent a bailiff to the
defendant’s house.
 The defendant brought an action in nullity saying that the Court of Quebec did not have
jurisdiction because the sum claimed was above the prescribed amount (then, $30,000).
Issues:
1. When deciding on jurisdiction of the court, do you consider the claimed sum only or do you
add the court costs and interest to the principal?
2. What is the impact of the defendant not appearing in court and not contesting?
3. When neither the defendant nor the court raises the issue of jurisdiction how is it dealt with?
Held:
1. Look only at the principal amount, exclude the interest and costs when assessing
jurisdiction. In the absence of an expanded provision, you ignore the other associated costs. If
you considered it, at some point during the litigation, technically, the court of Quebec could
lose jurisdiction as the interest accumulated to a point beyond $30,000.
2. The SC held that even if the CQ had no jurisdiction, the defendant was screwed because he
cannot be heard to complain about the lack of jurisdiction later if he didn’t raise it at trial. He
essentially waived his right to appeal on jurisdictional grounds by not raising the issue
previously.
3. Generally, the rules of jurisdiction are of public order – the parties cannot agree to have
million dollar litigation under small claims procedure. Courts who recognize that they have a
jurisdiction problem should raise it on their own. The Court said that in a situation like this
one where the parties allowed a court to hear a case and render a judgment, they should not
be able to turn around and claim that it is null.
POINT: When looking at the jurisdiction of the court, look at the principal amount.
Greenberg v. Denis [1985] p. 18
Facts:
 The plaintiff was litigating on his own behalf and also as a mandatary for many other people
(art. 59 CCP).
 At the time of the case, the monetary limit was $15,000.
 Here, each of the claims was less than $15,000, but together, the sum was greater than
$15,000.
 They took it up in Superior Court.
Issue:
Do you look at each individual claim or the aggregate to determine jurisdiction?
Held:
Court of Quebec has jurisdiction (so they transferred jurisdiction – this is a very rare solution).
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Ratio:
 Art. 59 CCP: w/r/t suing as a mandatary it was silent on the issue.
 Art. 67 CCP: this article addressed a similar situation. “Two or more persons, whose claims
have the same juridical basis or raise the same points of law and fact, may join in the same suit.”
 The conclusion was that the suit must be instituted in the Court of Quebec if that court
has jurisdiction in each of the claims, otherwise it must be instituted before the Superior Court
and should be applied by analogy.
POINT: Look at the individual claims and not at the aggregate. If each is below $70,000, then
sue in the Court of Quebec but if any one of them is more than $70,000, all of them go to the
Superior Court.
 For class actions, the principle is different. The Greenberg principle doesn’t apply. Art.
1000 CCP gives the SC’s exclusive jurisdiction over class actions.
Bélanger v. Ladouceur [1975] p. 19
Facts:
 Plaintiff trying to get driver’s license from Quebec.
 Director of Motor Vehicles refuses to issue one.
 Plaintiff takes proceeding in Court of Quebec. This is motion for declaratory judgment
(application to court asking for declaration). Asking for declaration that Director ought to issue
license.
Held:
 Court of Quebec only has jurisdiction set out in 34 to 36.2.
 There is nothing there about declaratory judgments, or about reviewing and reversing
decisions of provincial officers – only the Superior Court can do this.
 So no jurisdiction, application dismissed.
POINT: The provincial court’s jurisdiction is limited to its statutory ambit as set out in Arts. 3436.2 of the CCP.
La Caisse Populaire de Notre Dame de Quebec [1969], Civil Law, p. 20
Facts:
Plaintiff made a motion for declaratory judgment relating to a municipal tax issue, $450 (tax bill)
and brought the issue before the Superior Court.
Issue:
Who has jurisdiction?
Ratio:
 Amount: Superior Court doesn't have the jurisdiction to hear a case concerning an amount
less than $1,000.
 Municipal tax issue: Specifically mentioned in Art. 35(i) as being within the jurisdiction of
the Court of Quebec.
 It does not matter that plaintiff proceeded by means of a motion for a declaratory judgement
(Belanger).
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POINT: Do not be guided in choosing one’s court by what one is seeking – i.e. Belanger lesson
is incorrect – do not to look to what is sought. Look at substance, not at form of recourse i.e. that
it is municipal tax for $450, not that it is a motion for declaratory judgment.
 Second case is probably correct. Nothing to prevent you from bringing declaratory judgment
in Court of Quebec. Focus should be subject matter of case.
 Court of Quebec is highly specialized with regard to municipal taxation. It is appropriate that
it deal with the question, even if brought by means of declaratory judgment.
 It would be wiser to not seek declaratory judgment. But in any event, follow substance, not
procedure.
Corporation des Maîtres Mécaniciens [1975], Civil Law, p. 21
Facts:
 Professional body took disciplinary proceedings against one of its members and fined him.
 The member didn’t pay the fine so the corporation sued.
 The amount of the fine places the matter with in the jurisdiction of the CQ, so the plaintiff
took the action there.
 The defence was that there was the professional corporation had exceeded its jurisdiction.
Issue:
Does this court have jurisdiction?
Held:
No.
Ratio:
 Jurisdiction for Court of Quebec is set out in CCP 34-36.2 and it does not include the power
to revise a decision made by a professional body and its use of jurisdiction.
 If there were review, would have to be by Superior Court, so it is irrelevant that amount fell
with in jurisdiction under 34(1).
 The CQ jurisdiction is therefore statutory – arts. 34-36.2 will tell you what the CQ is allowed
to do. If the CQ is allowed to do what you want it to, that is where you sue (CQ jurisdiction is
exclusive).
What happens if you end up in the wrong court?
 If you’re in small claims court but the case is worth too much – the answer is art. 967. One
party objects and if the judge finds it well founded, he well have the case moved.
 There is more of a problem when you have to move b/w the Court of Quebec and the
Superior Court.
 In Belanger, case was dismissed. In Corporation, defence was dismissed. So there is
uncertainty in Quebec as to what you do if sue in wrong court.
 Art. 164 CCP doesn’t tell you what happens: 164 CCP: Lack of jurisdiction by reason of the
subject matter may be raised at any stage of the case, and it may even be declared by the court of
its own motion. The court adjudicates as to costs according to the circumstances.
 Art. 163 CCP, dealing with territorial jurisdiction: A defendant, summoned before a court
other than that before which the suit should have been instituted, may ask that the suit be
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referred to the competent court within the legislative authority of Quebec, or that the suit be
dismissed if there is not such court.
 The problem is that article 164 doesn’t say what should happen when the court lacks
jurisdiction by reason of the subject-matter.
 Transfer is possible in some circumstances. Art. 34 CCP refers to some areas where cases are
transferred.
o Cross demand: Claim made by defendant against plaintiff. If cross demand
belongs within jurisdiction of Superior Court, case is transferred from Court of
Quebec. If the initial claim is in SC jurisdiction and the cross-demand is for CQ
jurisdiction, the case is not transferred.
o Amendment: If initially claiming $35 000, and later want to claim another $36
000, whole case is transferred to Superior Court.
 So it is possible to transfer. But what is the result if case is instituted before wrong court?
 Only Greenberg resulted in a transfer. The 3 other cases we looked at following resulted in a
dismissal.
 In Corporation des Maitres Mecaniciens, court dismissed the defence (b/c it was not within
its jurisdiction to consider it) and granted the action b/c there was no defence to it, rather than
transferring the case.
 Cases such as Bélanger v. Ladouceur and Caisse Populaire de Notre Dame de Quebec
suggest that such a case would be dismissed, not transferred. BUT, in Greenberg, the court
suggested a transfer.
American Home Assurance: Multiple plaintiffs brought an action in the SC when it should be in
the CQ. The plaintiffs recognized the lack of jurisdiction and just asked for a transfer. The SC
judge recognized that he has the power to transfer the case to the CQ. The conceptual problem is
if the SC has no jurisdiction to hear the case, how do they have jurisdiction to transfer it? The
legislature should give a specific power to transfer.
 This question used to be of tremendous significance. Under 2225 CCLC (p. 30), an action
instituted before wrong court was nullity and did not interrupt prescription.
 When CCQ was brought into force, rule changed. 2895 CCQ (pg. 30): Where the application
of a party is dismissed without a decision having been made on the merits of the action and
where, on the date of the judgment, the prescriptive period has expired or will expire in less than
three months, the plaintiff has an additional period of three months from service of the judgment
in which to claim his right.
 So debate has lost practical significance. Although there is cost ramification – more
expensive if have to start over.
Court of Appeal – Jurisdiction (Final Judgment)
 The jurisdiction of the CA differs depending on whether it is an appeal from a final or
interlocutory judgment.
 Art. 29 CCP: Any judgment is interlocutory which is rendered during suit before final
judgment. Final judgment deals with merits and disposes of case.
 Sometimes, an interlocutory motion will lead to a final judgment (ex: a successful motion for
declinatory exception). This kind of judgment will be a final judgment.
The rules on appeals for final judgments are in art. 26. The general rule (art. 26 (1)) is that if the
“value of the object of the dispute in appeal” is $50 000 or more, there is an appeal as of right to
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the CA (no permission necessary). The flipside is that if it is worth less than $50 000, you can
ask for leave to appeal (art. 26 para 2 (5)). This article gives guidance to judges in exercising
discretion in appeals for leave (the matter at issue is a question of principle, a new issue or a
question of law that has given rise to conflicting judicial precedents).
26 CCP: Unless otherwise provided, an appeal lies:
(1)
From any final judgment of the Superior Court or the Court of Quebec, except in a
case where the value of the object of the dispute in appeal is less than $50,000.
(2)
From any final judgment of the Court of Quebec in a case where such court has
exclusive jurisdiction under any act other than this Code.
(3)
From any final judgment rendered in matters of contempt of court for which there is
no other recourse.
(4)
From any judgment or order rendered in matters of adoption.
(5)
From any final judgement rendered in matters concerning confinement in an
institution or psychiatric assessment.
(6)
From any judgment or order rendered in the following matters: (a) changes made to
the register of civil status; (b) tutorship to minors or absentees and declaratory judgments of
death; (c) tutorship councils…
An appeal also lies, with leave of a judge of the Court of Appeal when the matter at issue is one
which ought to be submitted to the Court of Appeal, particularly where, in the opinion of the
judge, (a) the matter at issue is a question of principle; (b) a new issue; or (c) a question of
law that has given rise to conflicting judicial precedents.
(5)
…
From any other final judgment of the Superior Court or the Court of Quebec.
 So, for final judgments, determine value. If $50 000 or more, or not quantifiable, there is an
automatic right. If the value is less than $50 000, need leave to appeal.
 For small claims court, art. 984 CCP indicates that judgment is final and without appeal.
Rules on quantification:
 Art. 27: Calculate interest up to date of judgment, not thereafter. Don’t count court costs.
 What is the “value of the object of the dispute in appeal”? It refers to the amount that you are
seeking from the CA. If I sue for $100 000 and win $70 000 and both sides want to appeal (I
want the whole and the defendant wants none), is there an automatic right to appeal? From my
point of view, the value is only $30 000 and I need leave but the value for the defendant is $70
000 so he can appeal as of right. You have to look at the amount from the perspective of the
person who seeks the appeal. Art. 26.0.1. says that when one party exercises the right to appeal
(with leave or as of right), then the other party can cross-appeal as of right.
 When you want to appeal litigation potentially worth less than $50 000, you can file a motion
to appeal de bene esse (just in case) which means that you can file for leave and for an appeal as
of right to cover your bases.
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 Deal with all sorts of things: amendments, change of attorneys, objections, etc.
 Fundamental rule: We don’t like appeals from interlocutory judgments. We prefer you wait.
There is, however, an exception in art. 29 CCP.
Interlocutory Appeals Before the Beginning of a Trial
29 (1) CCP: An appeal also lies, in accordance with 511, from an interlocutory judgment of the
Superior Court or the court of Quebec:
(1)
(2)
(3)
when it in part decides the issues;
when it orders the doing of anything which cannot be remedied by the final judgment;
or
when it unnecessarily delays the trial of the suit.
511 CCP: An appeal lies from an interlocutory judgment only on leave granted by a judge of
the Court of Appeal if he is of opinion that the case is one that is contemplated in art. 29 and that
the pursuit of justice requires that leave be granted; the judge must then order the
continuation or suspension of the proceedings in first instance.
** Note, appeal can only be with leave from interlocutory judgments and is discretionary – must
be in the pursuit of justice and, must have already fit into one of 29’s exceptions.
 Art. 511 means that the actual trial will be suspended or stayed pending the outcome of the
interlocutory appeal (ex: an appeal on a motion to exclude important evidence).
 The CA has adopted an accelerated procedure for going through interlocutory decisions – it
takes about 4 months and there are no factums. For final appeals, it takes much longer.
Interlocutory Appeals After the Beginning of a Trial
 Art. 29(2): Matters during suit. Legislator is even less inclined to have trial interrupted.
29(2) CCP: However, an interlocutory judgment rendered during the trial cannot be appealed
immediately and it cannot be put in question except on appeal from the final judgment, unless it
disallows an objection to evidence based upon article 308 of this Code or on section 9 of the
CCRF, or unless it allows an objection to evidence.
 So, 2 exceptions:
1.
Disallowing objections on grounds of privilege (308 CCP or 9 Charter):
i.e. The judge orders a witness to answer a question even though the information might
be privileged. You can appeal this immediately because to wait for the final judgment would not
resolved the problem since once its disclosed, it cannot be undone.
511(2) CCP: an appeal from an interlocutory judgment dismissing an objection to
evidence based on 308 or 9 is not subject to leave. Furthermore, the appeal does not suspend
the proceedings but the judge of first instance cannot render final judgment or hear the
evidence contemplated by the objection until the appeal form the interlocutory judgement is
decided.
1.
2.
So,
appeal as of right.
no suspension of trial.
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3.
cannot render final judgment until appeal resolved.
If there is no privilege, the witness must testify, if there is privilege - the trial is finished
and the judge can render final judgment without the privileged testimony.
The general practice (when it is not a question of privilege – ex: when it’s hearsay) is that
the trial judge will take the objection under reserve and hear the evidence. There is essentially no
wrong because it could be fixed by going to the C.A. If court of appeal agrees with you, they will
exclude that element form the record. As seen, this doesn’t work for privilege.
2.
Allowing objections as to evidence
For example, objects on hearsay.
Here, you have to get leave from the court of appeal.
If the appeal is based on the acceptance of an objection based on evidence, there is no
rule in 511 – you get to interrupt trial when you go to the CA.
You are allowed to interrupt because if the judge has allowed the objection, the answer
is not in the court’s record. If you go through the whole trial without the answer to the question,
the decision on the merits will be incomplete so the trial should not continue as it would be a
waste of time.
Interlocutory or Final?
Steps to Solve the Problem:
1. Is this an interlocutory or final judgment - does the judgment put an end to the dispute?
2. If Final:
a. Is the value greater than $50 000 (or other grounds in art. 26)? – Appeal as of
Right.
b. Is the value less than $50 000 – Appeal by leave of one CA judge.
3. If Interlocutory: Before or During Trial?
a. Before: Appeal by leave if 3 conditions in art. 29 are met (decides issues? Cause
delay? Causes non-remediable damage?) and in the interests of justice. Trial will
be delayed.
b. During: No Appeal unless:
i. Interlocutory judgment disallows objection based on privilege – Appeal
as of right and trial will continue.
ii. Interlocutory judgment allows objection based on any other evidence
other than privilege – Appeal by Leave and the trial is suspended
Dubreuil v. Laliberté [1975] Que. CA, p. 30
Facts:
Defendant makes a motion to dismiss the action and the court dismisses the motion (165(4)).
Issue:
Is this an interlocutory judgement to which there lies an appeal?
Held:
It is interlocutory. No appeal here.
Ratio:
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 The first question is: is this interlocutory or is this final? This is interlocutory because it did
not allow for and end to the judgment. Note that if the judge had dismissed the case (i.e. accepted
the motion) then it would have been final – and would have to have looked to the amount at issue:
>$50K  right of appeal; <$50K  appeal by leave.
 Next, you look to article 29 CCP and ask whether what has occurred has occurred outside the
trial or during the trial. Here, before the trial so you look to the exceptions giving you an appeal
as of right before trial.
 The decision on the motion did not decide, in part, the issue, it did not delay the trial nor did
it cause for a party to do something which could not be undone
 Therefore, no appeal.
POINT: Note the procedure for appeals.
Callen v. Lefrançois [1969] Que. CA p. 31
Facts:
 Plaintiffs were from New Jersey and had been injured in a car crash.
 In order to sue in QC, they are required to put up security for costs (protects defendants from
foreign lawsuits – foreign means not in QC).
 Plaintiffs are suing together by CCP 67 and the court ordered each of them to pay in $700
(the calculation was incorrect – they took the formula that for a $21,000 case the costs are $750.
So basically, they charged them double).
 They appealed.
Issue:
Interlocutory or final? Is there an appeal?
Held:
Interlocutory. Yes.
Ratio
 This is interlocutory at it doesn’t end the trial
 This is before the trial begins.
 So, falls in paragraph 1 of 29, does it fit an exception?
 Yes, this cannot be remedied by a final judgment because they are required to put the money
up now and if they don’t they will be thrown out of court (what if they cannot afford it?). The
judgment takes that money out of their pockets for the length of the trial and that cannot be
remedied by final judgment.
POINT: Note the procedure for appeals.
Hullabaloo A-Go-Go v. Teen Clubs International [1967], p. 32
Facts:
 The respondent petitioned for an interlocutory injunction to prevent the appellant from using
the word “Hullabaloo” in its dance hall operations.
 The appellant asked that the respondent file all documents evidencing its incorporation, the
agreement whereby it acquired the exclusive right to license, the existence of the trademark…and
this motion was dismissed.
Issue:
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Interlocutory or final? Can it be appealed?
Held:
Interlocutory. Yes.
Ratio:
 Interlocutory because does not put an end to the case.
 It is pre-trial, so look to CCP 29(1).
 Does not in part decide the issues; but does order the doing of something which cannot be
undone (29(2)).
Hamilton:
The problem with the judgment is that dismissing an order to produce documents does not order
the doing of anything at all – in fact, it does just the opposite, it allows for the not doing of
something. This case broadens art. 29 CCP, b/c it now includes the ability to appeal where a
judge failed to order the doing of something and that failure cannot be remedied by the final
judgment.
Hamilton thinks this may not be good law and may be a stretch (it didn’t work for him).
 A problem for appeals in Quebec is that the CA is overworked. 10 years ago, it took 4.5
years to put the appeal through to completion. Now, the delay is only 15 months. This is a great
improvement. This efficiency increase has been achieved by limiting appeals as of right (the old
threshold was $20 000) and by becoming more strict in granting leave. The Court has also
become more aggressive in dismissing cases that they feel have no chance of success (art. 501
CCP).
Geography/organization of the courts
 Quebec divided into 36 judicial districts.
 You choose a district as plaintiff. All motions take place in that district. Trial takes place in
that district. Note that this is limited in that you cannot choose a district simply based on which
will inconvenience the defendant most.
 The defendant has a right to appeal the plaintiff’s choice of judicial district. If there is no
appeal, the court of record will be the plaintiff’s choice of district.
 For appeals, there are 2 districts (art. 30 CCP): Appeals from western district are heard by the
CA sitting in Montreal and appeals from the eastern district are heard by the CA sitting in
Quebec.
D. Ontario
Courts of first instance
 For courts of first instance, superior court is called Superior Court of Justice. Previous name
was Ontario Court General Division.
 Courts of Justice Act, s. 11 confirms status as superior court: Ontario Court General Division
is continued…under name Superior Court of Justice. Has all jurisdiction, power, and authority…
 Only other court of first instance in Ontario is Small Claims Court. S. 22 Courts of Justice
Act: Small Claims Court is a branch of Superior Court of Justice 
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 Small claims used to be provincial. Now, federally appointed judges. So can increase
jurisdiction of small claims to $100 000 without s. 96 issue arising. There are no Provincially
appointed inferior court judges in ON.
 Monetary jurisdiction of small claims court under s. 23 is $10 000 (s.23 of the Courts of
Justice Act and regulation on p.36).
 The other constitutional issue that they dodged in ON relates to the fairness of the process.
There is no rule barring lawyers in ON small claims court.
 Small claims does not have exclusive jurisdiction. Not obliged to go to small claims court if
have $1000 claim. Can go to SCJ. S.23(2): The SCJ can transfer small claims cases into small
claims court but can only do so with the consent of both parties.
 The only time you end up with a problem in ON is if you sue in small claims court and the
case exceeds the jurisdiction of that court ($10 001 value). It is not that serious since you are in
front of a SCJ judge any way. S.110 of the Courts of Justice Act makes it clear that the case can
be transferred on the motion of a party.
 It is much simpler in ON at the level of 1st instance since all judges are federally appointed.
Appellate Courts
 There are 2 courts of appeal in Ontario: (a) the divisional court; and (b) the court of appeal.
 s. 18 Courts of Justice Act p. 34: talks of creation of Divisional Court – created in 1985. It is
another branch of the Superior Court of Justice with the same judges – 3 judges. This is an
intermediate court of appeal.
 Zuber Report (p.37): suggested expanding the divisional court and giving it more
jurisdiction because you can handle expanded case load without reducing consistency by hiring
more judges. He thought it should be a real intermediate court with its own judges. This
recommendation was not implemented so the Divisional Court’s jurisdiction remains limited.
 Have jurisdiction over 3 types of cases:
(1) Courts of Justice Act, s. 19(1)(a): Appeals from a final order of the SCJ for a single
payment of not more than $25,000, exclusive of costs. This is appeal as of right, on
question of law or fact or mixed law/fact. Where amount at issue is > $25 000, have
appeal as of right to CA.
 The quantification here is different then QC – the value of the judgment that is
considered is the actual value of the judgment and not the value of the difference
sought. In Goh, the plaintiff had asked for $110 000 won $8 400 and sought to
appeal to increase damages to $110 000. The proper jurisdiction was the divisional
court since the judgment appealed from was for $8 400. In QC, there would be an
appeal as of right to the CA because the value of the appeal (what is being sought) is
$101 600. If the plaintiff had lost his case, it is a $110 000 decision and there is an as
of right appeal to the CA.
(2) Courts of Justice Act, s. 19(1)(b): Appeals from an interlocutory order of a judge of the
Superior Court of Justice, with leave as provided in the rules of court (easier than
Quebec; don’t have categories).
 Grounds set out in R. 62.02(4): Shall not be granted unless (a) there is a conflicting
decision by another judge or court in Ontario or elsewhere on the matter involved; or (b)
there appears to the judge hearing the motion good reason to doubt the correctness of
the order in question and the proposed appeal involves matters of such importance
that, leave to appeal should be granted.
 Interlocutory vs. Final Judgments: It has been suggested (p. 41 – Mettitt) that the test is
expanded in certain situations. For example, when dealing with orders affecting persons not
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parties to the action, an order may be final if it disposes of a substantive right in the action,
notwithstanding that the merits of the original suit remains to be determined.
Kampus v. Bridgeford [1982] p. 42
Facts:
 Pf was injured in a car accident by the df and sued
 Pf has to get treated by physicians and OHIP covered the costs.
 Df asked OHIP to produce certain records and OHIP denied.
 The court ordered OHIP to product the records and OHIP wants to appeal the order.
 They appeal to the CA reasoning that since they are not parties to the action, it is a final order
for them.
Issue:
Is this interlocutory or final order?
Held:
Interlocutory.
Ratio:
 Whether a judgment or order is final or interlocutory depends on whether it finally disposes
of the rights of the parties and an order made against one who is a stranger to the action is
generally treated as a final order.
 Here, however, OHIP is not a stranger to the action it is a party to the action – this was a
subrogated claim brought on behalf of OHIP.
 So, OHIP needed to ask for leave since was an appeal from an interlocutory order.
POINT: Although not the case here, normally an order made against a stranger to the litigation is
treated as a final order.
(3) Courts of Justice Act, s. 31: Final orders of small claims court, where amount at issue is
$500 or more. More extensive right of appeal in Ontario than Quebec. This is appeal as
of right.
McClellan’s Sand & Gravel Ltd. v. Rueter [1982] p. 44
Facts:
 The pf did some work and sues for $320.
 The df says that the pf did shoddy work and sues him for $280.
 Df doesn’t show up to trial and the pf is awarded $320.
 Df wants to appeal and since she wanted $280 and now owed $320, she is asking for $600.
Issue:
Is the appeal for more than $500 (i.e. combined) or separate appeals and therefore less than $500
and therefore no appeal?
Held:
Separate, no appeal.
Ratio:
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 These are to be considered as two (2) separate claims and each is less than $500 so there is no
appeal available to the df.
 However, there are circumstances where can add a claim and counterclaim together, this is
where it is because of mere accounting – that is, when the basic facts are agreed on and there is a
simple question of how much is owing you may add together. Here, each issue is separate
because we are dealing with the quality of the work – need to settle the facts
 POINT: If the issue is mere accounting, may be able to add the claims.
 Note: It is not clear why this dispute wasn’t an accounting dispute or what an accounting
dispute is.
 CA in Ontario has jurisdiction over 3 types of cases:
(1) Cases where the amount is not quanitifable.
(2) Courts of Justice Act, s. 6(1)(b): s. 6(1)(b) Court of Justice Act: appeal from a final
order of a judge of the Superior Court, except an order referred to in clause 19(1)(a)
(< $25,000) or an order form which an appeal lies to the Divisional Court. Also, where
not quantifiable. This is appeal as of right.
(3) Courts of Justice Act, s. 6(1)(a): appeal from an order of the Divisional Court on a
question that is not a question of fact alone, with leave of the C.A. 2 limitations:
1. Appeal must not be on question of fact alone (you can appeal to the DC on a question
of fact alone so you should not get more than 2 kicks t the can).
2. Not an appeal as of right. Require leave.
Re Sault Dock Co. Ltd. and City of Sault Ste. Marie [1973] p. 38
Facts:
 Company looked to get a building permit and were denied one by the building inspector.
 The company applied to the Court for a mandatory order directing the issue of the permit –
the application was granted from whose decision and appeal was taken to the Divisional Court.
 After judgment of the Divisional Court, they look to appeal to the C.A.
Issue:
Under what circumstances should leave to appeal be granted? Should it be granted here?
Held:
No.
Ratio:
 As a general rule, decisions in matters coming before the Divisional Court in its appellate
capacity are intended to be final and that review of those decisions by the Court of Appeal are
to be the exceptions to the general rule.
 The magnitude of the amount involved is not of significance in deciding whether or not leave
should be granted – cases involving small sums may well be of more importance to the litigants
than is a vastly greater amount to the contestants in another action.
 What is important is the impact which the decision on the question will have on the
development of the jurisprudence of Ontario.
 If the resolution of the question would largely have significance only to the parties and would
not settle for the future a question of general interest to the public or a broad segment to the
public, the requirements to obtain leave will not have been met.
 Lists number of matters which generally should hear:
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(a) Interpretation of a statute or regulation of Canada or Ontario including its
constitutionality;
(b) Interpretation, clarification or propounding of some general rule or principle of law;
(c) The interpretation of a municipal by-law where the point in issue is a question of public
importance;
(d) The interpretation of an agreement where the point in issue involves a question of public
importance.
This case does not raise an issue of public importance – the City has not demonstrated that leave
should be granted.
POINT: Note the emphasis on a question of public importance when deciding on the merit
of an appeal.
Note: Don’t forget about appeals as of from the SCJ right for matters worth more than $25 000.
 2 potential problems:
(1) Multiple jurisdiction. If one party has a right to appeal to the CA and the other party has
a right to appeal to the DC:
o Courts of Justice Act, ss. 6(2) and 19(2): if one party has an appeal as of right to
the CA and exercises it, the other party also has one.
(2) The possibility of appealing to the wrong court.
 Courts of Justice Act, s. 110 allows transfer. Appeal will not be dismissed on
procedural grounds. Note that in Kampus, the court dismissed the appeal without
transferring it to the correct court.
Geography/organization of the courts
 Ontario is divided into districts, counties, or regional municipalities (51), and there is a SCJ
courthouse in each.
 The Province is subdivided into 8 Regions where the Divisional Court sits.
 The CA is only in Toronto
 R. 14.01: If as P you are suing in Ontario, you can file statement of claim at any courthouse
in Ontario. Court will open file, but file can move around.
 Motions, trial, aren’t necessarily where statement is filed.
 R. 46: Where case is ready for trial, P will indicate where he wants trial to take place. D can
object. There will be debate.
 R. 37.03: For motions, party making motion will suggest it be heard where it wants. Again,
can have debate on issue.
 Much greater level of flexibility in Ontario than in Quebec.
E. Federal Court
 s. 101 Constitution Act: Parliament of Canada may, form time to time provide for the
Constitution, Maintenance, and Organization of a General Court of Appeal for Canada, and for
the Establishment of any additional Courts for the better administration of laws of Canada.
 In 1875, Parliament created the Exchequer Court. In England, Exchequer Court was court in
which Crown sued to recover money or property.
o Original Canadian Exchequer Court dealt with claims by or against federal
Crown. Also had jurisdiction in admiralty law, IP, Canadian Armed Forces,
inter-provincial railways (S.91 areas).
o There was only one division, so appeal would lie directly to SCC.
o From 1875, judges were SCC judges who would sit alone or in panel.
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 In 1971, Exchequer Court was replaced by Federal Court. 2 significant changes:
(1) 2 divisions: FCTD and FCA. FCA is principally court of appeal but has original
jurisdiction in certain areas.
(2) Expanded jurisdiction, particularly in administrative law.
 The federal court is a statutory court, no inherent jurisdiction. Has whatever powers are
given to it by statute.
 The federal Parliament can only give jurisdiction to Federal Court if it is for better
administration of laws of Canada. See s. 101 CA.
Federal Court Act – Trial Division
 There are specific grants in other legislation (e.g., Competition Act, s. 11), but most are in
Federal Court Act (p.45 CB).
 Jurisdiction of TD set out in ss. 17 to 26.
 S. 17 relates to actions by or against federal crown. Gives FCTD concurrent original
jurisdiction. Prior to 1992, the FCTD had exclusive jurisdiction here but this was problematic
because if you wanted to sue the Crown and another party, you’d have to sue in 2 courts. This is
no longer an issue.
 S. 18: TD has exclusive jurisdiction with respect to judicial review over federal
administrative tribunals. No s. 96 issue, because dealing with federally appointed judges.
 S. 28: Special jurisdiction for FCA: if you are seeking review of a decision or order made by
a Federal tribunal made on a judicial or quasi-judicial basis, the FCCA has jurisdiction.
 S. 20: For IP: In dealing with registration of IP rights, jurisdiction of FCTD is exclusive. For
other IP areas, concurrent jurisdiction. So can sue for patent infringement anywhere.
 S. 22: Concurrent original jurisdiction for maritime law. Defendant cannot challenge your
choice. In this field, the FC has a lot of specialization and expertise so most maritime suits are in
the FC.
 S. 23: Concurrent jurisdiction of FCTD with respect to bills of exchange and promissory
notes where crown is party, aeronautics, works and undertakings connecting a province with any
other province (bridges, railways)
 S. 24: TD has exclusive original jurisdiction to hear all appeals under Act of Parliament (e.g.,
from Tax Court, Immigration Appeal Board).
Federal Court Act – Appeal division
 S. 27: Appellate jurisdiction. Whether decision is interlocutory or final, whatever amount is
at issue, there is appeal as of right to FCA.
 If interlocutory, must file appeal within 10 days. If final, within 30 days.
 S. 28 FCA: FCA has original jurisdiction for applications for judicial review for specific list
of ad. tribunals.
 Suing in Federal Court versus Provincial Courts (concurrent jurisdiction):
1. Federal Court tends to be much quicker, due to narrower jurisdiction.
2. Federal Court is nicer, more polite, sweeter.
3. Federal Court judges tend to have positions based on patronage.
4. Federal Court tends to be quite specialized in its areas.
5. Court is a single Canada-wide court. Therefore, can file a document in any of the 17
cities. (St-John’s to Whitehorse – and can deposit a document at any of the: can save
time with time zones).
6. Note that FC judges are thought to have a pro-Fed bias so think twice before suing the
Crown there.
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7. Federal court is single nation-wide court (like Ontario). Happens to sit in 17 different
cities.
8. When making application, can indicate preference. But it is left to Federal Court.
9. It is bilingual court.
 General rule is the case must be brought in Superior Court unless there is specific federal
legislation that complies with s. 101 that gives jurisdiction to Federal Court.
 If want to sue in SC, ensure that there is no exclusive jurisdiction given to Federal Court. If
want to sue in FCTD, look for federal statute that gives exclusive or concurrent jurisdiction.
 If it is concurrent, choice cannot be challenged.
 s. 101 is a serious constraint. Requires that it must be 1) Federal Law 2) For the Better
Administration – i.e. can’t simply be about the application of Federal Law.
 The general rule is that the provincial Superior court hears the case unless:
a) a statute gives jurisdiction to the FC
b) it is applicable in certain circumstances for the FC to hear the case
c) it is Constitutionally valid according to ss. 91+92 for the FC to hear the case
Bourget v. La Cite de Quebec et la Commission [1963], Civil Law, p.48
Facts:
Plaintiff slipped and fell on streets of Quebec City. The street is on the Plains of Abraham so it
belongs to the Federal Government but the city is responsible for snow removal.
Plaintiff sued them both, bringing action before the SC.
The commission moved to dismiss on the ground that the Exchequer Court (FC) had exclusive
jurisdiction to hear cases of Federal Crown liability.
Issue:
1. Does the FC have jurisdiction in this case over Crown liability?
2. Could Plaintiff sue both the Crown and the municipality before the FC?
Held:
1. Action was dismissed rather than transferred to FC (Exchequer court).
2. No.
Ratio:
a) Jurisdiction rationae materia: Jurisdiction by reason of the subject matter of the litigation.
It's a matter of public order. The parties can't simply waive it b/c the court can raise this issue
on its own volition. Ex: can’t sue in small claims court for $1 000 000. (Argument can even
be made that if a decision made is incorrect that it can later be annulled.) Lack of jurisdiction
on subject matter can be raised at any time (i.e. not subject to any time limits). [Art. 164
CCP].
b) Jurisdiction rationae personae: jurisdiction by reason of the person = jurisdiction over a
particular defendant (considering personal qualities – e.g., domicile). Lack of jurisdiction
Rationae Personae is not a question of public order and can only be raised by the Defendant.
If the Defendant fails to raise the issue before the time period in the Code, it can no longer be
raised. The defendant may ask that the suit be referred to the competent court or that it be
dismissed if there is no such courtt w/in the jurisdiction. [163 CCP].
c) Court concluded that this is not a case of rationae personae (merely in virtue of the fact
that it was the federal Crown being sued), but was a Question of jurisdiction over the
matter: the subject matter is that of Crown liability  MUST BE FC.
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Note: S.12 of the Federal Court Act now gives FC concurrent jurisdiction w/r/t liability of the
Federal Crown but prior to 1992, it was exclusive.
Issue 2

No. Nothing says FC has jurisdiction w/r/t municipalities (it's an area of provincial law). The
only solution for the Plaintiff at the time would have been to bring 2 parallel actions:
one against the City in CS and the other against the Commission in the Exchequer
Court.
 Raises 2 problems:
1. Prescription: will there be time to start again over? CCQ amended so that 2895 allows for
instances that where a case has not been heard on its merits but has been dismissed,
prescription doesn’t apply.
2. Still need 2 actions…. AND  risk of contradictory judgements, + fees, etc
Quebec North Shore Paper v. Canadian Pacific [1976] p. 53
Facts:
 K between CP and QNSP to transport newsprint by railway from Baie Comeau.
 Railway cars were put on a ferry, and when they reached Quebec city, they were put back on
the tracks. This was done to benefit from tariffs in Railway Act.
 QNSP failed to meet contractual obligations of constructing railway terminal to get the trains
onto the boats so CP sued for breach of K and demand $36 MM in damages.
 CP sued in Federal Court (for “strategic reasons” saying that their action regards
interprovincial transportation and s.23(c) of Federal Court Act, gives concurrent jurisdiction
to the FC in all cases where “a claim for relief is made or a remedy is sought under an Act of
Parliament or otherwise in relation to works and undertakings extending beyond the
provincial boundaries.”
 The first question one asks when determining the jurisdiction of the Federal Court is, is there
statutory basis for the jurisdiction?
 CP pointed to s. 23 of the Federal Court Act and the court is interested in interpreting what
“or otherwise” means in the context of s. 23 (since they were not suing under the Railway Act
– a Parliamentary statute, but under contract law, which they claim falls under ‘otherwise’).
Issue:
Does the Federal Court have jurisdiction under 23(c)?
Held:
No.
Ratio:
Federal Court:
 Words “or otherwise” must be read restrictively in light of s. 101 “the better administration of
the laws of Canada” includes federal legislation and nothing else. Parties are seeking remedy
under K law, which is not part of Parliament.
Federal C.A.
 The laws of Canada include any law Parliament can validly enact, amend or repeal.
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


Since the Federal parliament could amend this K which applies to extra-provincial
undertakings, Quebec K law is part of the “laws of Canada”.
Held that CCQ applies simply b/c Federal Parliament has not chosen to enact its own K law
applicable but the mere fact that it could enact such legislation means the provincial
legislation in its place is created as a law of Can and therefore FC has jurisdiction.
Held that the Fed Ct. had the ability to hear the case.
S.C.C.: (Laskin J.)
 Substantially narrowed the definition of “laws of Canada” and overturned FC CA decision.
 Not enough that Federal parliament “could have done something” but there must be
some Federal legislation either re-enacting provincial law or incorporating it by
reference before it becomes a “law of Canada.”
 “or otherwise” therefore applies to Federal Common Law – i.e. the issue of crown liability
which is partially regulated by statute and partially within the Common Law.
POINT: Test = All you do is look at the revised statutes of Canada and find a Federal
statute that applies. There must be some Federal legislation either re-enacting provincial
law or incorporating it by reference for it to become a “law of Canada”.
 Realize that above, “or otherwise” must be qualified by s. 101 and the notion of better
administration of the laws of Canada, so the issue then becomes: what are the laws of Canada?
Notes:
 So notion of laws of Canada in s. 101 means federal statute (including incorporation by
reference or reenactment).
 What about Crown liability? This is not set out in statute, but we know court has jurisdiction
here. Laskin: Federal common law. In addition to federal statutes, there is federal common law
(i.e., federal crown liability). There are no other examples of federal common law.
 So:
1. Find statute that gives jurisdiction to Federal Court (Federal Court Act). Here, s. 23(c).
2. Statute must be in conformity with s. 101 CA. Must be a question of better
administration of laws of Canada, where laws of Canada means federal law, including
federal statutes and federal common law (i.e., federal crown liability).
 Whenever you sue Crown, federal court will have jurisdiction:
1. S. 17(1) FCA gives jurisdiction to Federal Court.
2. Statute is in conformity with s. 101 CA, because Federal crown liability is part of
federal law.
 When Federal Crown is suing:
1. S. 17(5) FCA: TD has original concurrent jurisdiction…in which Crown claims relief.
2. For s. 101 CA test, if have K with Federal Crown, and breach it, no federal law
involved. Notion of Federal Crown liability has no application. Must look at particular
law suit to see if it involves better administration of laws of Canada. A defendant in this
circumstance is likely able to contest jurisdiction in this circumstance because why is it
better for the administration of law in Canada for Crown to sue in FC?
Buenos Aires Maru [1986] p. 56
Facts:
A contract was made to deliver goods to Montreal.
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The goods were shipped, unloaded, stored and stolen.
Plaintiff sued transportation co. in FC saying it was a question of maritime law (s.22 Federal
Court Act even though goods were on dry land because it was stored at the port to which it was
delivered).
Issue:
Is it maritime law and thus within Federal Jurisdiction by virtue of the test above?
Held:
Yes.
Ratio:
3 conditions to be met for FC jurisdiction:
1. There must be a statutory grant of jurisdiction by the Federal Parliament. Here, statutory
grant in that s.22 Federal Court Act gives jurisdiction over maritime law.
2. Case must be based on the administration of Federal law. 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. Here, maritime law is a body of Federal law, incorporating by
reference all of the English Maritime Common Law through s. 2 and s. 42 of Federal Court
Act (e.g. of what Laskin J. referred to as
“Federal re-enactment or Federal incorporation
by reference”).
3. Federal law must be Constitutionally valid: must be a “Law of Canada.” Here, Federal
Parliament has Constitutional jurisdiction over maritime law and shipping under s. 91(10).
[Dissent]: This has nothing to do with maritime law – it has to do with tort.
POINT: See test for Federal Court jurisdiction.
F. Supreme Court of Canada
 Established in 1875 under second part of s. 101.
 When it was created in 1875, it did not have final word. There was appeal from SCC to
Judicial Committee of Privy Council. But still played important role: Ensured consistency.
 Appeal to PC was restricted over time, abolished in 1949.
 S. 52 Supreme Court Act: The court shall have and exercise exclusive ultimate appellate
jurisdiction. Its judgments are final and conclusive in all cases.
 SCC has 2 types of jurisdiction: acts as a Court of Appeal, and as a court of original
jurisdiction.
SCC as court of appeal
 Jurisdiction as CA for civil matters defined in s. 40(1) Supreme Court Act: Must go through
hierarchy before SCC. Only goes with leave of SCC. Test: sufficient level of public importance,
where question ought to be decided by SCC.
 Test for granting leave to appeal: s. 40(1)(c) SCA:
a) Whether the question involved in the appeal is, by reason of its public importance or
issue of law, or issue of mixed law and fact, one that ought to be decided by the SCC,
or
b) The issue is of a nature or significance as to warrant a decision by the SCC.
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 Note: From 1875 to 1975, had appeals as of right in civil matters (monetary threshold – $10
000 in 1975).
 From 1875 to 1975, had panels of 3 judges to listen to motions for leave to appeal. In 1988,
Court adopted process where it could decide on basis of written materials. Would invite parties
to court only if unsure.
 Pg. 64: S. 37 and 37.1: Certain courts have power to give leave with respect to final
judgments. Awkward to ask judge who just found against you for leave. Also not appropriate for
CA to be telling SCC what cases to hear. Power is infrequently exercised. SCC gets 600 motions
for leave and only hears 75-150 cases per year – the CA should use this power infrequently.
Ashmead v. B.C.C.A. [1992] p. 65
 In considering leave applications under s. 37 this court ought to have particular regard to
issues of provincial as well as national concern. It is in this respect that a provincial court of
appeal might be in a better position than the S.C.C. itself to recognize a case as one which
required final adjudication in the country’s highest court.
 It seems to be that we ought to grant leave only in very rare cases in which we are
convinced that an issue is raised of such obvious and compelling importance that the litigation
calls for the attention of the S.C.C.
 On criminal matters, see ss. 691-696 CC. There is an appeal as of right in certain
circumstances. Thus, SCC will be more stingy in granting leave to appeal in other cases, due to
increased workload.
 There are broad circumstances where either the accused or the Crown has an appeal as of
right in criminal matters:
1. The accused: on any question of law where there was a dissent in the C.A. or when the
accused was acquitted at trial but the acquittal by a jury and reversed in C.A. Can appeal
with leave on any other Q of law.
2. The A.G.: can appeal as of right when there is a dissent in the C.A. on a Q of law, and has
appeal with leave in any other case.
 Statistics:
o SCC hears 100 cases/year.
o 30-60/year appeals as of right.
o 14-15% of motions for leave are granted.
 There is a problem in Quebec for consistency of CA judgments because there are 20 judges.
Also, arguably get better judgment from CA judges specializing in particular area rather than 3
SCC Civil law judges and 2 SCC common law judges. Thus, there is talk of creating a Supreme
Court of Quebec.
 Tremendous portion of SCC workload is Charter, Criminal. Does not tend to hear a lot of
pure civil law cases.
 The delay is a bit less than 2 years to receive judgment from the day of your motion.
SCC as court of original jurisdiction
 Court also has role as court of original jurisdiction. Under s. 53 SCA, governor in council
may refer to court for hearing…constitutional matters. S. 53(2), governor in council may refer to
court…any matter.
 Less than 1 % of caseload are references.
 Milgard is only example of reference in area different than constitutional law.
Ernewein v. Min of Employment and Immigration [1979] p. 73
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Facts:
 She was ordered deported from Canada and appealed under the Immigration regime to the
Immigration appeal board, which said she must be deported.
 She made a motion for leave to the Federal C.A. and they denied her leave.
 This case dealt with an appeal to S.C.C. after the refusal of the Federal C.A. to grant leave to
appeal.
 She's not appealing from the merits of the decision, but from the Federal C.A.'s refusal to
grant her leave to appeal from a F.C.T.D. decision.
 Therefore, if she's successful before the S.C.C., she'd be granted leave by the S.C.C. to the
Federal C.A. because that's all the S.C.C. could do in the circumstances.
Issue:
Should the S.C.C. grant leave?
Held:
No.
Majority [Laskin J.]:
 S.C.C. does not have jurisdiction to order the Federal C.A. to hear a case.
 The Legislature has decided that the intermediate C.A. has power to determine whether it will
hear cases.
 It is a Question of policy to let the Federal CA have discretion.
 It is also a Question of judicial comity. If it'd be rude for C.A. to tell S.C.C. which cases to
hear, it'd be rude for S.C.C. to do so.
 Language of s.41 of the Supreme Court Act is not clear enough to require the S.C.C. to
grant leave to appeal to another court.
Dissent [Pigeon J.]:
 Looked at the merits of the decision and said that here it is necessary to interfere. He
experienced “grave doubts” as to the correctness of the immigration board's decision, from which
leave to appeal was sought. This is question of major importance. Language of s. 41(3) is broad
enough to include this. Here, it is necessary to intervene. Would have granted leave to appeal.
POINT: The S.C.C. will be hesitant to dictate the lower court’s case load.
Macdonald v. City of Montreal [1986] p. 76
Constitutional case involving language rights
 The plaintiff had received a traffic ticket that was solely in French – and appealed its
constitutionality.
 He lost at trail and asked the Quebec Court of Appeal for leave and it refused to grant it.
 The reason it refused to grant it is because it had recently heard a similar case and said that it
was constitutionally valid.
 However, important to note that the plaintiff of that case decided to not pursue it to the S.C.C.
 So, effectively, this case, if not accepted by the Quebec Court of Appeal would never be
decided on by the S.C.C.
 S.C.C. came to exactly the opposite conclusion (from above) in that it held that it did have
jurisdiction to hear an appeal from a CA decision refusing leave to appeal.
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 S.C.C. said the Quebec C.A. was wrong and said that now we’ll hear the case and that there
was no need to send it back to the Quebec C.A. since we know what they will decide.
VII. Territorial Jurisdiction of the Courts
A. Statutory or Common Law Jurisdiction
 Territorial jurisdiction is the first debated issue in litigation.
 2 types of jurisdiction:
1. Subject matter jurisdiction (rationae materiae)
 Which court within a territory has jurisdiction to hear this “kind of case”?
 I.e.: $20,000 breach of K - Sup Court, Court of Que. or Federal Court?
 Subject matter jurisdiction is of public order (cannot agree to file in Small Claims if the
action is for more than 3000$). Thus, if appear in wrong court, action is dismissed.
 Que.: debate over whether it is dismissed of transferred.
2. Personal or Territorial jurisdiction (rationae personae)
 Which court has jurisdiction? Question is not whether a court has jurisdiction in this type of
case, but whether the court of this territorial region has jurisdiction w/r/t this particular case
 Question is whether it is Que. Courts, Ont. Courts or courts of different country
 E.g., Which court has territorial jurisdiction over contractual dispute when K entered into in
Montreal and Plaintiff lives in Ont.?
 Within Quebec, there is the additional question of which district has jurisdiction. In Ont. and
the FC, only issue is whether it should be in Ont. or the FC. Not concerned with territorial
divisions; can file in any of the cities.
 If the plaintiff is from Quebec and Defendant from Italy, where will he want to sue? He’ll
pick the location where he can recover the biggest judgment for the least expense – likely Quebec
– several reasons why:
1. Home court advantage:
a) Financial: Less expensive (no travelling).
b) Familiarity: Will apply Que. rules of procedure.
c) Language: Doesn’t have to speak Italian.
d) Lawyers: Can have a lawyer with whom you’re familiar.
e) Judges: Parties always believe that judges are rooting for the local party.
2. Witnesses: Issue of expense. If the majority of witnesses are in Quebec, do not have to fly them
all to Italy.
3. Applicable law: Also an issue of expense. If the applicable law is Italian, need to pay experts to
swear to the content of that law. In the best possible world, conflict of law provisions would deal
with it all, but the reality is that tensions mean that it is always better for the court to try and
establish firmly that their law will apply.
4. Enforcement of judgment: If all of the defendant’s assets are in Italy, you’ll need to get the
Italian courts to enforce the judgment if you want to get paid. You might be better off suing in
Italy.
5. Likelihood of Success. You’d take a securities class action in the US and a Consumer
Protection Class Action in QC.
Look at the factors the defendant will consider:
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 The plaintiff chooses jurisdiction, but the defendant, however, can challenge. The same
factors as above will be considered, albeit from the opposite viewpoint.
 Defendant can challenge either on the basis that under the rules which the plaintiff has used there is no jurisdiction or the defendantfcan ask the Court to exercise its discretion. (i.e. “forum
non-conveniens”)
 There is a 3rd competing interest: Interest of court, legislature, public interest.
 There are a number of factors favoring that a court have broad jurisdiction:
1. Every court seems to be of the view that it is best qualified to deal with the matter.
2. Revenue for the courts.
3. Good for local plaintiff. Local legislature will want to help out local plaintiff.
 There are factors that militate a more narrow jurisdiction:
1. Court congestion. Because of backlog in Superior court, don’t want more people to able to sue
here.
2. Enforcement. Do not want courts to have such a broad jurisdiction that judgments are not
enforced elsewhere. Over the long term, court system here will be brought into disrepute.
 Must check your fact pattern against rules on territorial jurisdiction, to see which court will
hear your case. Often, there will only be one jurisdiction in the world that can hear your case.
 Where there is more than one, plaintiff is entitled to choose. Defendants will refer to this as
forum shopping. Defendant can challenge on two grounds:
1. Plaintiff has misinterpreted rules, and on rules court does not have jurisdiction. (See art.
163 CCP)
2. Court has jurisdiction, but it is inappropriate choice, and court should exercise discretion
to not hear case. Doctrine of “forum non-convenience”.
QUEBEC
Rules regarding jurisdiction
 In Quebec, rules in CCQ. See articles 3134-3154: International jurisdiction of Quebec
authorities (courts). First question: Do Quebec courts have jurisdiction?
 Second question: Where should lawsuit be instituted in Quebec assuming that a Quebec Court
has jurisdiction? Dealt with in arts. 68-75 CCP.
 There was no rule in CCLC regarding international jurisdiction. So 68-75 CCP were used to
answer both questions. If 68-75 CCP did not point to any jurisdiction, Quebec courts did not
have jurisdiction.
 Because 68-75 CCP were not amended, there is asymmetrical situation now in which CCQ
may indicate there is jurisdiction, but 68-75 CCP points nowhere.
Berube v. Burnac: The judge implies that art. 3148 has modified art. 68 CCP. If the CCQ says
that a QC court has jurisdiction, judges will now stretch the CCP to find you a district.
 3134 CCQ: Basic rule: Quebec authorities have jurisdiction where defendant is domiciled in
Quebec.
 75 CCQ: Domicile of a person is at the place of his principal establishment.
 83 CCQ: Election of domicile: Parties may elect a domicile in a writing.
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 3 categories of special provisions: (i) real and mixed actions, (ii) personal actions of an
extrapatrimonial and family nature, and (iii) personal actions of a patrimonial nature.
 We’ll be dealing with second category: personal actions of a patrimonial nature.
(i) Real and mixed actions
 Where plaintiff is asserting real right, this is real action. According to 3152 CCQ: Defendant
must live in Quebec or property must be in Quebec
 73 CCP: Real action or mixed action may be taken either before the court of the domicile of
the Defendant or before the court of the district where the property in dispute is situated in whole
or in part. This matches 3134 and 3152.
(ii) Extrapatrimonial and family matters
 Extrapatrimonial and family matters: Custody, adoption, etc. CCQ has special rules in 3141
to 3147. CCP has rules in 70-70.2. Not discussed further.
(iii) Patrimonial matters
 3148: In personal action of patrimonial nature, Quebec court has jurisdiction where:
(1) Defendant has domicile or residence in Quebec.
 Residence is broader than domicile. It is the place where he or she ordinarily resides.
 Residence is factual test, it is where you spend time. Domicile is about intention.
 Can have several residences, but only one domicile.
 A legal person’s domicile is its head office (307 CCQ). They can be sued in QC if their head
office is there.
 68(1) CCP covers this: A personal action may be instituted before the court of the
Defendant’s real domicile or, in the cases contemplated by article 83 CCQ, before that of his
elected domicile.
If the Defendant has no domicile in Quebec but resides or possesses property therein, he
may be sued before the court of his ordinary residence, before the court of the place where such
property is situated, or before the court of the place where the action is personally served upon
him.
 So 68(1) CCP adds notions of property and service. Item of property that could often be
found would be accounts receivable. Only had to establish that they were owed money by
someone in Quebec.
 The test for district is much broader than the test for jurisdiction
o Prof.: Legislature probably meant physical property. Not included in CCQ, but is
in CCP. So can’t bring in foreigners, but prone to abuse within Quebec.
 Service ground is only available if defendant has no domicile but resides or possess property
in Quebec. Note: This is traditional common law ground.
o Dropped from 3148 as well.
 If 3148 is not met, can’t sue in Quebec. SO the fact that 68 is broader is not so problematic.
But leads to potential to abuse within province.
(2) The D is a legal person, is not domiciled in Quebec but has an establishment in Quebec,
and the dispute relates to its activities in Quebec.
 An establishment of a legal person corresponds to the residence of a natural person. A & W
has a store in QC and that’s enough to sue them here if the suit relates to their store here.
 Prof.: Art. 68 CCP should probably have been amended to correspond with 3148 CCQ.
There is now a difficulty when jurisdiction is established under 3148(1)(2), and no district is
specified in 68.
103
(3) Fault was committed in Quebec, damage suffered in Quebec, injurious act in Quebec.
 Art. 68 CCP provides 2 rules that correspond to this: 68(2) and 68(3).
 68(2): Can sue before court of place where whole cause of action has arisen.
o Under old theory, all 3 (fault, damage, causal link) had to occur in Quebec, and
within single district. This is instance where art. 68 CCP is more narrow.
 This is a very stupid rule so the courts played w/it. There is still an inconsistency for
choosing district if different elements of a delict took place in different district.
 E.g., a plane crashes due to negligent maintenance. Injurious act is crash, fault was
committed where plane was made. What if these occurred in different places? If anyone of these
occurs in Quebec, there is jurisdiction under 3148(1)(3) CCQ. This is more liberal than art. 68
CCP, which requires whole cause of action to arise for there to be jurisdiction.
 Plane crash may meet 3148 CCQ, so can sue in Quebec, but applying art. 68 CCP, won’t
have district jurisdiction. Prof: There is gap, need amendment.
 Because 68 CCP is restrictive, courts have taken liberal approach to whole cause of action
requirement.
Bérubé v. Burnac Corporation [1994] p. 87
 Court says that when the National Assemble enacted 3148 CCQ, it amended 68 CCP by
adding the words “subject to the provisions of this Chapter and the provisions of Book Ten of the
C.C.Q….”
 The court went on to say that they made a mistake and that 68 needed to be amended to track
the language in 3148.
 The Court concludes that it will assume that 68 was implicitly amended by 3148 so instead of
looking at the “whole cause of action” if you have jurisdiction because the fault was committed in
Quebec, then you have jurisdiction in Quebec.
(3) One of the obligations arising from a contract was to be performed in Quebec.
 This replaced art. 68(3) CCP, which granted jurisdiction based on where the contract was
concluded.
 The notion of where a K was concluded used to be complicated because of technology (e.g.,
offer/acceptance via computer, conference calls, etc.) – “postal-rule” type difficulties.
 Now, with art. 3148(1)(3) CCQ test, situation is better, because courts look to substance of
the obligation.
 Hamilton: The court would have no choice but to be lenient in interpreting “where the
K…was made”. Presumably, the place where the obligation was to be executed would be the
most logical district.
 Another difficulty with art. 68(3) CCP: Consumer Protection Act has specific rules imposing
where K was concluded. Thus, may have jurisdiction via art. 3148 CCQ but nowhere to go in
68(3) CCP.
 Also, art 68(3) CPA deems that the contract was made if made by an agent where he gave his
consent.
 The new rule is less artificial – the inquiry is based on whether a part of performance was in
QC. This creates a real connection to QC.
Quebecor Printing Memphis Inc. v. Regenair Inc. [2001] p. 84
104
 Quebecor is based in Memphis, Regenair is based in Montreal.
 Quebecor entered into a contract to buy machines from Regenair and Regenair built the
machines in Montreal and delivered them to Quebecor .
 Quebecor did not pay and Regenair is suing (Regenair sues in Quebec).
Issue:
What is the appropriate jurisdiction?
Held:
Not Quebec
Ratio:
 Said that the contract said that Regenair was responsible for installing and supplying
machines in Memphis – there was no obligation implicit in the contract that was to be performed
in Quebec. Both obligations (supply & install) were to be performed in Memphis. Regenair could
have built the machines anywhere in the world.
 The fact that Regenair didn’t get paid doesn’t mean that a damage occurred in QC, the
location of Regenair’s head office. The debt was payable in Memphis, and its non-payment is not
a damage in QC.
 A broad interpretation of 3148 as suggested in the dissent would turn the normal rule
(jurisdiction if Defendant is domiciled or Resident in QC) upside down by giving QC jurisdiction
over any case where the plaintiff resides in QC.
[Dissent – Philippon J.]:
He made two arguments:
1. 3148(3) gives QC courts jurisdiction over disputes arising out of contracts where one of the
obligations was to be performed in QC. He says that it is a contractual action and the principal
obligation was to supply and install a machine in Memphis but Philipon noted that it was clear
that the machine was going to be custom built, therefore, the obligation to assemble the machine
was to be performed in QC and therefore, QC courts had jurisdiction.
2. 3148(3) gives QC jurisdiction when the damage was suffered in QC. Regenair’s head office
is in QC so when Regenair didn’t get paid, damage was suffered in QC.
 To support his decision, he said that if courts think that QC’s jurisdiction is too broad, there is
discretion to decline to exercise jurisdiction (Forum non Conveniens).
Note:
 If QC Courts take too much jurisdiction, other states will not recognize our judgments – the
rules must be interpreted strictly.
POINT: The word “damage” in 3148(3)(b) refers to physical damage, not non-payment.
Also, look at the obligations in the contract carefully to see where they are to be performed
– just because they are performed in a certain jurisdiction does not mean the contract
provided that they were “to be performed” there.
Spar not in Casebook
 The S.C.C. disagreed with the majority decision in Quebecor.
 The court opted for the broad interpretation provided by Philippon J.
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 Here, in this case, the only connection to Quebec was the fact that the plaintiff’s head office
was in Ontario but had a branch in Quebec. Spar alleged that its branch had suffered damage to
its reputation and the S.C.C. said Quebec had jurisdiction.
 Notes that if a problem, you always have a forum of non convenience to change the
jurisdiction.
Internet Law
Investors Group Inc. v. Douglas Frederick Hudson [1999] p. 87
Facts:
 Investor Group is suing Hudson, a former employee, for slander.
 Slanderous comments were posted on his website.
 Hudson resides in Quebec, the preparation of the website was carried out by Hudson in
Quebec and customers or potential customers of Investor Group reside in Quebec and Canada.
 The server was located outside of Quebec so the defendant contested QC’s jurisdiction.
Issue:
Who has jurisdiction?
Held:
Quebec
Ratio:
 The location of the server is irrelevant.
 Hudson is resident here in Quebec – he cannot hide behind the place of origin of his server.
 There is more than mere access to Hudson’s website tying this litigation to the province of
Quebec. All other facts giving rise to this litigation have their origins in Quebec – both parties are
resident here, the business dealings b/w them arose in QC, even the litigation instituted by
Hudson was instituted before the S.C. of QC.
 Whether the mere act of accessing a website in a specific jurisdiction is sufficient minimum
contact for suit to be brought in that jurisdiction is questionable.
Convectair NMT Inc. v. Ouellet Canada [1999] p. 88
Facts:
 Ouellet brought a motion for an order transferring the action brought by Convectair to the
district of Montmagny. Ouellet carried on business in Montmagny.
 The action for trade-mark infringement was commenced in Montreal where Convectair
carried on business. Convectair claimed that Ouellet was using the term Convectair in the subtext of its website on the Internet.
 The plaintiff alleged that the whole cause of action occurred in Montreal (the information was
disseminated in Montreal, caused confusion in the Montreal marketplace and caused him damage
in Montreal).
Issue:
Where should the action be brought?
Held:
Montmagny
106
Ratio:
 Convectair failed to prove that the facts giving rise to the cause of action arose in Montreal.
 Confusion to the consumer was not the sole criterion for establishing whether there was
trade-mark infringement. The facts giving rise to the confusion arose in Ouellet's place of
business in preparing the website.
 Convectair was unable to point to any fact which formed a part of the cause of action arising
in Montreal.
Note:
 Note, here, the fault was the design of the site, not the posting of it.
 The design took place in Montmagny. The whole cause of action was not in Montreal (68(2))
but 68(1) applied so action in Montmagny.
 You cannot sue in any jurisdiction – someone must have accessed the site.
Australia p. 89
 Australia’s court gave a businessman the right to sue for defamation in Australia over an
article published in the U.S. and posted on the Internet.
 So, now access gives jurisdiction – according to this court.
 The foregoing discussion shows the difficulty that courts have w/adjusting to new
technologies.
Special rules:
 Arts. 3149-3151 CCQ provide special rules on jurisdiction with respect to specific types of
Ks.
 Art. 3149 CCQ: Ks of employment, consumer Ks: Quebec courts have jurisdiction if
consumer or worker has his domicile or residence in Quebec.
 Art. 3150 CCQ: K of insurance: Quebec courts have jurisdiction if insured is domiciled or
resident in Quebec, if insured property is located in QC, or if loss was suffered in QC. Art. 69
CCP has the same rule – public order.
 Art. 3149, 3150 CCQ are intended to protect these parties with the assumption that these
parties are plaintiffs and have jurisdiction even if merchant, employer, or insurance K are outside
the province.
 Art. 3151 CCQ: Quebec authority has exclusive jurisdiction to hear in first instance all
actions founded on liability under 3129 CCQ. Art. 3129 CCQ: damage suffered in or outside
Quebec as a result of exposure to or the use of raw materials, whether processed or not,
originating in Quebec.
 Art. 3165 CCQ: The jurisdiction of a foreign authority is not recognized by Quebec
authorities in the following cases:
(1) where, by reason of the subject matter or an agreement between the parties, Quebec
law grants exclusive jurisdiction to its authorities to hear the action which gave rise to the foreign
decision.
 Arts. 3151, 3129, 3165 CCQ provisions are an attempt to say that all actions w/r/t asbestos
are governed by Quebec law and must be heard here. Not widely applied. Protects Quebec
asbestos producers. If a judgment is obtained against an asbestos producer anywhere but in
Quebec, the judgment will not be enforced in Quebec.
 If such a foreign judgment is Canadian, there will be a constitutional problem.
Procedural matters
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 Art. 3138 CCQ: Quebec authority may order provisional measures even if there is no
jurisdiction on the matter. (E.g., if an Enron defendant has property in QC and the plaintiffs want
the property seized, QC Courts can be used to seize the property even though they have no
jurisdiction over the merits.)
 Art. 3139 CCQ: Where a QC authority has jurisdiction to rule on the principal demand, it also
has jurisdiction to rule on an incidental demand or a cross demand. (E.g., where a customer buys
a defective product, and sues merchant, and merchant wants to turn around and sue manufacturer.
If Quebec court has jurisdiction over the first demand, then it will have jurisdiction over
everything.) This avoids splitting litigation. This is similar to 71 CCP
 Art. 72 CCP: A plaintiff who has joined several causes of action which did not all arise in the
same district may bring his action before any court which has jurisdiction over any one of them.
o Where the plaintiff has several causes of actions which arose in different
districts, the plaintiff can bring the whole cause of action in any of the districts
where one of the causes of action arose.
 Art. 75 CCP: Action against several defendants domiciled in different districts may be
instituted in the court before which any one of them could be summoned. A QC Court needs to
have jurisdiction over each defendant before they can all be sued before the same court.
ONTARIO
 Traditional Common law notion of jurisdiction is based on personal service of the writ of
statement of claim on the defendant within the jurisdiction (i.e, must serve in Ontario).
 Domicile, residence or subject matter are not relevant. Only exception: if you trick the D to
come to Ontario, and then serve him, ON has no jurisdiction.
 This notion is based on control: D must be within physical grasp of court. This is presencebased jurisdiction.
 This is not found in Rules of Practice.
 Two exceptions: Rules of Practice have been expanded to allow a plaintiff to serve a
defendant outside ON in 2 ways (see 17.02 and 17.03) Service Ex-Juris (assumed jurisdiction) –
authorized jurisdiction outside Ontario:
1. R. 17.02: Enumerates ex juris without leave: A party to a proceeding may, without a court
order, be served outside Ontario where the proceeding against the party consists of a claim or
claims,
(a) In respect of in respect of real or personal property in Ontario;
(e) In respect of a contract where (note: any of the 4 criteria are sufficient),
(i)
the contract was made in Ontario,
(ii)
the contract provides that it is to be governed by or interpreted in
accordance with the law of Ontario,
(iii)
the parties to the contract have agreed that the courts of Ontario are to
have jurisdiction over legal proceedings in respect of the contract, or
(iv)
a breach of the contract has been committed in Ontario.
(g) In respect of a tort committed in Ontario.
(h) in respect of damage sustained in Ontario arising from a tort, breach of contract, breach
of fiduciary duty or breach of confidence, wherever committed;
 This corresponds to art. 3148(1)(3) CCQ.
108
 Prof.: This provision is open to abuse and has been abused.
(o) against a person outside Ontario who is a necessary or proper party to a proceeding
properly brought against another person served in Ontario;
 This is different from QC where you have to establish the jurisdiction of QC Courts w/r/t
each party. Once QC has jurisdiction over each one, art. 75 CCP allows you to sue in any
applicable district. In ON, it says that if you serve one Defendant in ON and another defendant is
a party, you can serve them outside of ON.
(p) Against a person ordinarily resident or carrying on business in Ontario
(q) Properly the subject matter of a counterclaim, cross claim or third or subsequent party
claim under these rules.
2. R. 17.03: Permission from court to serve outside Ontario.
 Rule 17.03 (with leave): In any case to which rule 17.02 does not apply, the court may
grant leave to serve an originating process or notice of a reference outside Ontario.
 Where the defendant gets served outside of ON, he can object on the basis that the plaintiff
wrongfully invoked rule 17.02 or on the basis that leave shouldn’t have been granted. He must
make a motion to set aside the service pursuant to rule 17.06.
Rule 17.06 (defence): A party who has been served with an originating process outside Ontario
may move, before delivering a defence, notice of intent to defend or notice of appearance, for
(a) an order to set aside the service, or to (b) stay proceedings…
Rule 17.06(2): the court may make an order under sub rule (1) or such other order as if satisfied
that:
(a)
(b)
(c)
service outside Ontario is not authorized by these rules (not authorized by 17.02);
an order granting leave to serve outside Ontario should be set aside; or
Ontario is not a convenient forum for the hearing of the proceeding.
Muscutt et al. v. Courcelles et al. [2002] p. 90
Facts:
Three weeks after moving from Ontario to Alberta to work on a contract for his Ontario
employer, Muscutt was a passenger in a vehicle that was involved in a collision.
Muscutt was seriously injured in the accident. After he was released from hospital, he returned to
live in Ontario, where he received ongoing medical care.
At the time of the accident, all of the defendants resided in Alberta.
Muscutt brought an action in Ontario for damages. His statement of claim was served in Alberta
without leave under Rule 17.02(h), which provided for service outside Ontario for a claim in
respect of damage sustained in Ontario arising from a tort.
Simpson and Durcharme-Gullins (defendants) moved to set aside service ex juris and to stay the
action for want of jurisdiction and because Ontario was not the convenient forum (R.17.06). They
also argued that Rule 17.02(h) was ultra vires the province of Ontario because the Rule had extraterritorial effect.
109
Issues:
1. Is 17.02(h) ultra vires the province?
2. Did the motions court judge err in finding that the Ontario Superior Court could assume
jurisdiction against the out-of-province defendants?
3. Did the motions court judge err in refusing to exercise his discretion to decline jurisdiction on
the grounds that Ontario is not the forum of conveniens?
Held:
1. No.
2. No.
3. No.
Ratio:
a. Development of Assumed Jurisdiction:
 There are 3 ways in which jurisdiction may be asserted against an out-of province
defendant: (1) presence based jurisdiction (jurisdiction over an extra-provincial defendant
physically present in the territory of the court); (2) consent-based jurisdiction (jurisdiction over
an extra-provincial defendant who consents, by voluntary submission, attornment by appearance
and defence, or prior agreement to submit to disputes in that jurisdiction) ; and (3) assumed
jurisdiction (initiated by service pursuant to 17.02 – and, unlike presence based and consentbased jurisdiction, assumed jurisdiction, prior to Morguard and Hunt did not provide a basis for
recognition and enforcement of an ON judgment outside of the Province.
b. Law Relating to Recognition and Enforcement of Extra-Provincial Judgments
 Morguard established that the proper exercise of jurisdiction depends on 2 principles: (i)
there is a need for order and fairness; (ii) there must be a real and substantial connection.
This is the test for jurisdiction. The court in Hunt gave the Morguard principle constitutional
force.
 The language used to describe real and substantial connection is general deliberately so to
allow for flexibility.
c. Relationship b/w Assumed Jurisdiction and Recognition and Enforcement
 Even though Morguard dealt with jurisdiction from the perspective of recognition and
enforcement, the same real and substantial connection test applies to the assumption of
jurisdiction against an out-of-province defendant.
 The need for order, fairness and jurisdictional restraint also applies to assumed jurisdiction.
d. Distinction b/w Assumed Jurisdiction and Forum Non Conveniens
 Often, there is more than one forum capable of assuming jurisdiction so must decide where to
litigate.
 When more than one forum is capable of assuming jurisdiction, the most appropriate forum is
determined through the forum non conveniens doctrine, which allows a court to decline to
exercise its jurisdiction on the ground that there is another forum more appropriate to entertain
the action.
 List factors considered to determine most appropriate forum: (a) location of majority of the
parties; (b) location of key witnesses and evidence; (c) contractual provisions that specify
applicable law or accord jurisdiction; (d) the avoidance of a multiplicity of proceedings; (e) the
applicable law and its weight in comparison to the factual questions decided; (f) geographical
factors; and (h) whether declining jurisdiction would deprive the plaintiff of a legitimate
juridical advantage available in the domestic court.
110
 Must distinguish real and substantial connection test from discretionary forum non
conveniens: while the real and substantial connection test (fact specific) is a legal rule, the forum
non conveniens test is discretionary.
 Look at as a 2-staged test that first considers assumed jurisdiction and then considers
forum non conveniens.
 Note, the real and substantial connection test requires only a real and substantial connection,
not the most real and substantial connection.
I. Is Rule 17.02(h) Ultra Vires the Province?
 Rule 17.02(h) is procedural in nature and does not by itself confer jurisdiction - the rule is
intra vires the province.
 The constitutional rule of extraterritoriality requires that the only causes of action in respect
of which service ex juris is available are those in which there is a substantial connection b/w the
defendant and the forum province. It follows that provincial rules of court allowing for service
out of the jurisdiction, including 17.02(h) must now be read in the light of the constitutional
principles of order and fairness and real and substantial connection.
 It has long been accepted that service in accordance with the rules of court does not
determine the issue of jurisdiction.
 The grounds in 17.02 provide a rough guide to the kinds of cases in which persons outside
Ontario will be regarded as subject to the jurisdiction of the Ontario courts, however, these
grounds do not determine the issue of jurisdiction.
II. Did the Court Err in Granting Jurisdiction?
Court identifies 8 factors to help assess whether a court should assume jurisdiction:
1. Connection b/w the forum and the plaintiff’s claim
 A province undoubtedly has an interest in protecting the property of its residents within the
province but cannot do so by unconstitutional means.
 Here, the plaintiff required extensive medical attention in Ontario – this damage presents a
significant connection with Ontario.
2. Connection b/w the forum and the defendant
 If the defendant has done anything w/in the jurisdiction that bears upon the claim by the
plaintiff, the case for assuming jurisdiction is strengthened.
 Look at expectations – where it’s reasonably foreseeable that the defendant’s conduct would
result in harm within the jurisdiction (i.e. manufacturer of defective goods knows someone
anywhere may be harmed by them).
 Here, the defendants did not have any connection w/ Ontario that would justify the
assumption of jurisdiction. Although they engaged in an activity that carried an inherent risk of an
accident with an out-of-province party, their conduct falls short of what may constitute personal
subjection or submission to the jurisdiction of the Ontario Courts.
3. Unfairness to the defendant in assuming jurisdiction
 Here the assumption of jurisdiction would not result in any significant unfairness to the
defendant. The defendants were engaged in an activity that involves an inherent risk of harm to
extra-provincial parties.
 The defendant’s insurance provides for protection in lawsuits in other Canadian provinces.
4. Unfairness to the plaintiff in not assuming jurisdiction
 Must consider the plaintiff’s interest in access to the courts of his home jurisdiction.
111
 Here, if jurisdiction were refused, the plaintiff would be compelled to litigate in Alberta – this
would be inconvenient to the plaintiff given the injuries he has sustained and because of the fact
that unlike the defendants, the plaintiff does not have the benefit of an insurer to cover the costs
of litigation.
5. The involvement of other parties to the suit
 The twin goals of avoiding a multiplicity of proceedings and avoiding the risk of inconsistent
results are relevant considerations.
 Where the core of the action involves domestic defendants, the case for assuming jurisdiction
against a defendant who might not otherwise be subject to the jurisdiction of Ontario courts is
strong.
 Here, involvement of other parties is not a significant factor.
6. Court’s willingness to recognize and enforce an extra-provincial judgment rendered on
the same jurisdictional basis
 Court must consider whether it would recognize and enforce an extra-provincial judgment
against a domestic defendant rendered on the same jurisdictional basis.
 Where a court would not be willing to recognize and enforce an extra-provincial judgment
rendered on the same jurisdictional basis, the court cannot assume jurisdiction.
 It is appropriate for Ontario courts to recognize and enforce judgments from the courts of
sister provinces rendered on the same jurisdictional basis as in the case at bar.
7. Whether the case is interprovincial or international in nature
 Notes that Morguard held that the considerations underlying the rules of comity apply with
much greater force b/w the units of a federal state and that a federation implies a fuller and more
generous acceptance of the judgments of the courts of other constituent units of the federation.
8. Comity and the standards of jurisdiction, recognition and enforcement prevailing
elsewhere
 One aspect of comity is that in fashioning jurisdictional rules, courts should consider the
standards of jurisdiction, recognition and enforcement that prevail elsewhere.
III. Did Lower Court Err is Refusing to Exercise Discretion Based on Non Conveniens?
 Ontario is the most convenient forum for the action.
 The inconvenience the plaintiff would suffer if he were required to bring the action in Alberta
outweighed the inconvenience the defendant would suffer by ON accepting jurisdiction.
Note:
 Essentially threw out 17.02. Said 17.02 is only useful for the purpose of how to proceed once
you find a real and substantial connection exists.
 After Muscutt, meeting the criteria in 17.02 is not sufficient. You need the additional step of
working through the contact-counting test.
 This is the leading ON case on jurisdiction
Spar Aerospace – Not in CB
To what extent does Muscutt apply in QC. Do you need a real and substantial connection in QC?
Hamilton says that the courts have not dealt with this issue in QC. This is a non-issue because
under the grounds of 3148, you’d probably meet the “real and substantial connection” test and if
not, forum non conveniens would be used to get the case out of QC. If “real and substantial
connection” test is a constitutional principle, as the ON CA implies, it probably does apply to QC.
112
B. Jurisdiction based on consent
 If the Defendant doesn’t mind being sued somewhere, typically courts will allow the suit.
QUEBEC
 3 different mechanisms:
1. Positive consent
 Parties can give jurisdiction to court.
a) An agreement in advance specifying which court will preside. In Quebec, the parties can elect
domicile in their contract. This can be a simple choice of forum clause.
b) An agreement after the litigation begins where the parties agree to litigate in a particular
jurisdiction. This can take the form of a failure to object to the forum chosen by the plaintiff.
2. Negative Consent
 Ex: A clause in the contract indicating that there will be no suit in a particular jurisdiction.
 Positive Consent in QC:
 Art. 3148(1)(4) CCQ: Courts of QC have jurisdiction where the parties have by agreement
submitted to them all existing or future disputes between themselves arising out of a specified
legal relationship.
 Art. 3148(1)(5) CCQ: Courts of QC have jurisdiction where defendants submit to QC
jurisdiction. I.e., Plaintiff sues Defendant and Defendant comes to court and does not contest
jurisdiction. You have to object to jurisdiction in the specified delay according to your litigation
schedule.
 Negative Consent in QC:
 Art. 3148(2) CCQ: Quebec authority has no jurisdiction where parties have given jurisdiction
to foreign authority or arbitrator unless Defendant submits. I.e., court will not automatically
dismiss – it must be asked to do so.
 The above is subject to the principles of Forum non Conveniens (3135 CCQ) and Forum
Conveniens (3136 CCQ), whereby QC Courts can accept or decline jurisdiction based on
convenience, regardless of what the law is.
2736349 Canada Inc. v. Rogers Cantel Inc. [1998] p. 79
Facts:
 There was a contractual dispute b/w the two parties.
 The contract had a clause that said, “this agreement shall be construed and enforced in
accordance with the laws of the Province of Ontario and the parties irrevocably attorn (accept) to
the jurisdiction of the courts of such Province” (i.e. seems to grant exclusive jurisdiction to ON).
 Plaintiff sued in QC and Defendant made a motion to dismiss based on that clause
Issue:
 Does QC have jurisdiction?
Held:
 No.
Ratio:
 The clause falls within the second paragraph of 3148. Although an agreement to “attorn to
the jurisdiction” of ON does not necessarily mean a grant of exclusive jurisdiction (literally
113
means accept the jurisdiction), no magic words are needed so long as the intention is clear – the
word “irrevocably” has a big impact.
 The question of the interpretation of a choice of forum clause was described as a question of
jurisdiction rationae materiae.
Notes:
 Hamilton argues that this interpretations is too broad – the language of the clause seems to
only accept the ON courts but contains no language that excludes other jurisdictions (not
persuasive given “irrevocably”).
 Hamilton also argues that the characterization of this issue as being one of jurisdiction
rationae materiae, results in the courts being able to make an issue of this on their own motion.
This decision makes it possible to contest choice of forum clauses past the prescribed delays.
ONTARIO
 Positive Consent:
 Agreement in advance: R. 17.02(f)(iii): A contractual clause giving jurisdiction to Ontario
will justify service outside Ontario.
o Note that this rule is subject to the “real and substantial connection” test but it is
probably very difficult to argue out of your own consent.
 Submission: R. 17.06: Defendant can challenge service. Delivering a notice of appearance
or intent to defend will constitute submission.
o It is not a time issue in ON but it is a question of whether the defendant has taken steps
that are inconsistent with a desire to have the case dismissed in ON and moved
elsewhere.
 Negative Consent: Contractual clause for exclusivity for foreign court:
G & E Auto Brokers Ltd. v. Toyota Canada Inc. [1980] p. 82
Facts:
 Toyota and G & E had an agreement that said “this agreement shall be interpreted according
to the laws of the Province of Ontario… the parties agree to submit to the jurisdiction of the
Courts of the Proince of ON exclusively”
 G &E sues in B.C. and the defendant made a motion to dismiss, claiming that the court has no
jurisdiction over it.
Issue:
Does B.C. have jurisdiction?
Held:
No.
Ratio:
 It is agreed that, except for the clause in question, the B.C. courts have jurisdiction in this
matter because the parties have carried on business in B.C. and because the alleged reaches of the
contract have occurred in B.C.
 Accepts the view of Lord Denning that a stipulation that all disputes be judged by the
tribunals of a particular country is not absolutely binding. It is a matter to which the courts of
the is country will pay much regard and to which they will normally give effect, but is subject to
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the overriding principle that no one by his private stipulation can oust these courts of their
jurisdiction in a matter that properly belongs to them.
 I turn to consider whether the plaintiff has shown that the discretion of the court ought to be
exercised by refusing a stay.
 The plaintiff contends that all of the dealing b/w the parties were in BC and that both the
plaintiffs and defendants have a real connection with BC since they do business there. The
witnesses for the plaintiff are in BC and Ontario law on the question before the court is not
different from the law in BC.
 The defendant says that is will have to bring witnesses from Ontario.
 I do not think that the reasons advanced by the plaintiffs are of sufficient strength to
override the bargain made by the parties that the Ontario court should have exclusive
jurisdiction on the matter.
Notes:
 The clause in this case was much stronger than the clause in Rogers Cantel. It is a clear
exclusive jurisdiction clause.
 The Court gave itself wiggle room by saying that they will honour choice of forum clauses
but they are not binding.
 They reserved for themselves a power to weigh the balance of convenience and the question
of whether the plaintiff has sufficient reason to breach the choice of forum clause. In principle, if
the plaintiff can convince a court that the non-chosen court is more convenient, the court can
agree to ignore the clause.
POINT: Exclusive jurisdiction clauses are not absolutely binding. The balance of
convenience will be looked at and the plaintiff will have to satisfy the court that breach is
for good reason.
C. Discretion in the exercise of territorial jurisdiction
 Courts sometimes have discretion over whether or not they will exercise their jurisdiction
(Forum non Conveniens).
ONTARIO
 In ON, the “real and substantial connection” test has resulted in less scope for forum non
conveniens. The appropriate case is where there is jurisdiction under Rule 17.02 but there is no
“real and substantial connection”. After Muscutt, it is less likely that a plaintiff’s successful
claim to jurisdiction will be tenuous. In all likelihood, once jurisdiction is established, it will
likely also be found to be a convenient forum.
 This discretion works both ways in ON: ON courts can take jurisdiction where they don’t
have it or they can refuse to take jurisdiction when they have it.
 There are 3 types of discretion in the exercise of jurisdiction: Forum Conveniens, Forum non
Conveniens and anti-suit injunctions.
 Forum Conveniens: Ontario can take discretion even if it doesn’t fall within the rules (R.
17.03). This is discretion to authorize service outside the jurisdiction. This is done via ex parte
motion. A decision to grant leave is reviewable under rule 17.06 and the standard of review will
be whether or not there was a real and substantial connection between ON and the litigation.
 Forum non Conveniens: Courts have discretion to decline jurisdiction in circumstances
where under rules they have jurisdiction (R. 17.06). 17.06 sets out three circumstances:
1.
The plaintiff used a ground under rule 17.02 improperly.
2. A judge is convinced that leave was granted improperly.
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3. ON is not a convenient forum for the hearing of the proceeding.
 This is doctrine of forum non conveniens. Test is summarized in Amchem, pg. 107 in
Sopinka’s judgment. Looks at English test from The Spiliada:
o Look at where the defendant was served. If he was served in the jurisdiction, the
defendant has the burden to demonstrate that there is another forum which is
more appropriate (the most real and substantial connection, the natural forum).
Court will look at factors affecting convenience and expense – where are parties,
witnesses, governing law (e.g., must prove Quebec law to Ontario judge – this is
expensive and risky, because judge doesn’t know anything about law).
o If defendant is successful in establishing that there is a more appropriate forum,
burden shifts to plaintiff to justify his choice. Plaintiff can succeed in doing so
by establishing a valid reason for choosing other jurisdiction – to gain a
legitimate personal or juridical advantage (for example: assets of defendant are
located in chosen forum - possibility of executing judgment, the fact that the
plaintiff may benefit from privilege against self-incrimination, cannot sue unions
in Ontario). Court would not consider the fact that Mississippi juries hate
Quebecers, or trying to get large punitive damages.
o When defendant is served outside the jurisdiction, the plaintiff has the burden
throughout. Must establish that it is appropriate forum, and the benefit of which
he will be deprived.
 The Canadian rule isn’t quite as clear. Not clear if there is a difference w/r/t the burden of
proof if the defendant is served within or outside of the jurisdiction.
 Sopinka suggests that the 2-step approach described above is due to history and the 2nd step
is just a subset of the 1st step. In either case, we are looking at which is the more appropriate
form. How much weight you give to the advantages sought by the plaintiff is not clear.
 The “real and substantial connection” test from Muscutt has also muddied the waters.
Hamilton thinks that FNC tests might disappear if tests for jurisdictions keep subsuming “close
connection” and “convenient forum” ideas.
 Anti-Suit Injunctions: Ontario court can prevent exercise of jurisdiction by foreign court.
This can be looked at as discretion or as recognition of foreign judgments.
 E.g., plaintiff wants to sue in Texas in circumstances where natural forum is Ontario.
Assume that Ontario Court views Texas jurisdiction as inappropriate (they hate long-arm
jurisdiction and treble damages). Defendant has assets in Ontario. If plaintiff later comes to
Ontario and wants to enforce judgment, Ontario court can refuse. This is issue of recognition of
foreign judgment.
 If plaintiff has his/her domicile/residence in Ontario, Ontario court can go further. Anti-suit
injunction: defendant who is being sued in Texas can ask Ontario court to issue injunction
directly to plaintiff ordering him to not continue lawsuit in Texas. Note that this does not amount
to the Ontario court telling the Texas court what to do – it is simply an exercise of power by an
Ontario court over an Ontario resident. If the plaintiff ignores the order he will be held in
contempt of court.
Amchem Products Inc. v. B.C. Worker’s Compensation Board [1993] p. 103
Facts:
 194 persons, mostly residents of B.C., allege that injuries resulted from exposure to asbestos.
 B.C. Workers’ Compensation Board compensated some of the victims and has subrogated
their claims against the defendant asbestos producing corporations.
 The law suit was brought before a Texas court. Most of the defendants were US based
companies, none of which were incorporated in Texas, but most carried on business in Texas.
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 Defendants brought motion in Texas to stay the proceedings based on FNC and were denied.
Then defendants went to B.C. court to ask that an injunction be granted against the plaintiffs,
precluding them from bringing action in Texas. And, B.C. Supreme Court granted the injunction
with respect to plaintiffs still domiciled in B.C. (anti-suit injunction).
 The non-B.C. plaintiffs then went back to Texas court and asked for an order against the
defendants to not ask for an anti-suit injunction against them (anti anti-suit injunction)and
Texas granted it.
Issue:
Whether the anti-suit injunction issued in B.C. should be set aside.
Held:
Yes.
Ratio:
 Court notes that the courts have developed two forms of remedy to control the choice of
forum by the parties: (1) stay of proceedings; and (2) anti-suit injunction. The fundamental
difference between them being that in the case of the stay, the domestic court determines for itself
whether it should take jurisdiction whereas, in the case of the injunction, it in effect determines
the matter for the foreign court (even thought the order operates in personam on the plaintiff in
the foreign suit).
 Considerations of Comity are particularly important when a court is deciding on whether to
grant an anti-suit injunction.
 In order to develop criteria for granting anti-suit injunctions, it is necessary to consider
when a foreign court has departed from our own test of forum non conveniens to such an
extent as to justify our courts in refusing to respect the assumption of jurisdiction by the foreign
court and to consider in what circumstances such assumption amounts to a serious injustice.
Anti-Suit Injunctions
 First preliminary consideration: The domestic court should not entertain an application
for an injunction if there is no foreign proceeding pending. It is preferable that the decision of
the foreign court not be pre-empted until a proceeding has been launched in that court and the
applicant for an injunction in the domestic court has sought from the foreign court a stay or other
termination of the foreign proceedings (FNC) and failed.
 Second preliminary consideration: If the foreign court does not stay the proceeding based on
the defendant’s application, the domestic court must proceed to entertain the application for an
injunction, but only if it is alleged to be the most appropriate forum and is potentially an
appropriate forum (Note: an anti-suit injunction basically asks the domestic court to proclaim
jurisdiction – the suit is always in favour of another court. The applicant essentially says: the
action should have been commenced in the domestic forum as the more appropriate place of
trial).
 In applying for an injunction the following must be met:
1. Step one: Determine whether the domestic forum is the natural forum, that is the forum
that on the basis of the relevant factors, has the closest connection with the action and
parties. Under this test, the court must determine whether there is another forum that is
clearly more appropriate.
 In this step, the court, as a matter of comity, must take cognizance of the fact that the foreign
court has already assumed jurisdiction.
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 If, applying the principles relating to forum non conveniens, the foreign court could
reasonably have concluded that there was no alternative forum that was clearly more appropriate,
the domestic court should respect that decision and the application should be dismissed (apply our
standard for FNC).
2. Step two: If the domestic court concludes that the foreign court assumed jurisdiction on a
basis inconsistent with principles relating to forum non conveniens, step two requires the
court to ensure that granting an injunction will not deprive the plaintiff of advantages
in the foreign forum of which it would be unjust to deprive him of.
 Notes that this question must be asked in consequence and that a party can have no
reasonable expectation of advantages available in a jurisdiction with which the party and
the subject matter of the litigation has little or no connection.
 Any loss of advantage to the foreign plaintiff must be weighed against the loss of advantage
to the defendant in the foreign jurisdiction if the action is tried there rather in the domestic
forum.
 If the link to the forum is tenuous, the weight of the advantage will be reduced.
Application to the facts of this case:
 Found that B.C. courts were not clearly more appropriate. Some of plaintiffs lived in B.C.,
damages had occurred in B.C. only in some cases, defendant’s acts all occurred outside B.C. On
unjust deprivation, court stated that issues here were not substantial. No basis to issue injunction
to force plaintiffs to sue in B.C.
POINT: Notice the two step test applied to anti-suit injunctions: (a) is the domestic court
the more appropriate forum; and (b) would the injunction deprive the pf an advantage in
the foreign court and would therefore be unjust to deprive the plaintiff of?
Hamilton:
 Both forum non conveniens and anti-suit injunctions have the same purpose and should
therefore obtain the same result – that is, have litigation take place in the appropriate jurisdiction.
 However, there is a big difference is a court refusing to take jurisdiction (forum non
conveniens) and essentially determining a matter for a foreign court. The difference lies in the
notion of comity:
“Comity is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and
good will, upon the other. But it is the recognition which one nation allows within its territory
to the legislative, executive or judicial acts of another nation, having due regard both to
international duty and convenience and to the rights of its own citizens or of other persons
who are under the protection of its laws.”
QUEBEC
 Same 3 types of discretion (FC, FNC and anti-suit injunctions), but more recent development.
 In QC, prior to 1994, the situation was simple. If the plaintiff could bring himself w/in 68-75
CCP, the QC Courts had jurisdiction and no discretion to refuse. If not, there is no jurisdiction.
 In 1994, with CCQ, legislator has adopted notions of discretion.
 Forum non Conveniens - Art. 3135 CCQ: Even though Quebec has authority, it may,
exceptionally and on application, decline jurisdiction, if authorities of another country are in a
better position to decide.
Quebecor Printing Memphis Inc. v. Regenair Inc. [2001] p. 84
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The following factors are considered by courts in deciding whether or not another State’s
authorities are in a better position to decide:
1. Location of the formation and execution of the contract which gave rise to the dispute.
2. The existence and content of a similar foreign proceeding and the progress made in it.
3. The location of the defendant’s property.
4. The applicable law.
5. The advantages available to the plaintiff in the chosen forum.
6. The interests of justice.
7. The interests of the parties.
8. The necessity of an eventual judgment on recognition/enforcement of a foreign judgment.
 Forum Conveniens - Art. 3136 CCQ: QC courts can take jurisdiction even where they have
no jurisdiction under any other article. It can do so if the dispute is sufficiently connected to QC
and the proper forum would be more inconvenient or impossible to litigate. Ex: If Iraq was the
natural forum, a motion under 3136 would likely be successful.
 Anti-suit injunctions. Art. 758 CCP: Order of injunction can in no case be granted to restrain
legal proceedings…
o QC Courts have interpreted that an anti-suit injunction is against the plaintiff and not
the proceedings.
o This article, however, has been interpreted to mean that you cannot use an injunction to
restrain legal proceedings in QC so anti-suit injunctions are still ok.
D. Recognition of foreign judgments
 When will our courts recognize and enforce decision rendered by foreign court?
 Key issue: Do we think other court had jurisdiction?
 Enforcement vs. Recognition: In some instances, judgment requires only recognition. In
other cases, requires enforcement.
o If individual is divorced in France, gets remarried in Quebec and dies, who is
widow? Must recognize French divorce judgment to call 2nd wife widow.
o For monetary judgments, require enforcement. Have bailiff go out and seize
property. If there is no QC judgment ordering enforcement, the foreign judgment
is useless.
 For enforcement, there are 3 different methods:
1. Bring new action on original cause of action. Might get some mileage out of original
judgment, but in principal starting over. This is tremendously inefficient. Also creates
risk of contradictory judgments.
2. Bring action in Quebec, where cause is failure to pay amount under judgment.
3. Registration of foreign judgment. Bring judgment to judge, and ask for judgment
confirming it. This is like getting it rubber-stamped.
ONTARIO
 The general rule is that the plaintiff must sue on the judgment as a new cause of action.
There can be procedural shortcuts for this like summary judgments because the facts have already
been pleaded and settled.
 When suing on foreign judgment, key condition is that foreign court had jurisdiction. This
does not mean jurisdiction under their rules or our rules. We mean jurisdiction in the
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international sense: Does foreign court have jurisdiction in limited sense that we will recognize
judgment? This is essentially a stink-test and it is not based on the local court’s rules.
 Traditional common law grounds established in 19th C England. Emanuel v. Symon, pg. 116:
In actions in personam, there are 5 cases where courts of the country will enforce foreign
judgment:
1. Where defendant is subject of the foreign country. Prof: This is more complicated in
modern times with federal states and greater movement of people.
2. Where he was resident in foreign country.
3. Where defendant in the character of plaintiff has selected forum in which he is afterwards
sued.
4. Where he has voluntarily appeared.
5. Where he has contracted to submit himself to forum.
 None of issue of damages suffered in jurisdiction, K executed there, etc…Instead, look at
these factors.
 The test comes down to 3 notions, citizen of the foreign jurisdiction, resident of the foreign
jurisdiction or submission to the foreign jurisdiction.
 Problem: In Canada, can have judgment rendered in Ontario, that plaintiff tries to get
enforced in Manitoba. Traditional test: only have residence and voluntary submission. So in
Canada can only sue where they are resident or if they voluntarily submit. Otherwise, cannot do
anything with judgment.
De Savoye v. Morguard Investments Ltd. [1990] p. 114
Facts:
 Respondent took mortgages on land in Alberta.
 The appellant, then resident in Alberta and was guarantor under the mortgages, later took title
as mortgagor, then moved to B.C.
 There were defaults on the mortgages and the respondents brought action in Alberta and
served the appellant in B.C.
 Judgment was held in Alberta (the defendant did not show up) and properties were sold
pursuant to court orders against the defendant.
 The respondents then commenced a separate action in B.C. to enforce the Alberta judgment.
Issue:
Should B.C. accept Alberta’s judgment?
Held:
Yes.
Ratio:
 This traditional common law test is too limited, particularly in federal state like
Canada.
 At minimum, Canadian court should recognize judgment of another Canadian court
provided that other Canadian court had real and substantial connection to case.
 For decisions rendered within Canada, it is sufficient if there be a real and substantial
connection for the court to recognize the validity of jurisdiction of another province. This is an
attempt to widen jurisdiction within Canada only.
 “Why should a plaintiff be compelled to begin an action in the province where the defendant
now resides, whatever the inconvenience and cost this may bring, and whatever degree of
connection the relevant transaction may have with another province?” The real and substantial
connection is sufficient at least within Canada.
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 In this case, the dispute was about real estate in AB so AB was closely connected enough so
BC should have enforced it.
Notes:
 La Forest says that the old test was developed in the UK because of concerns over
international comity but Canada is a single state where the units are bound by a constitution and
the people have guaranteed mobility rights and judges in the SC’s are all appointed by the Feds.
 This was regarded as a development of the common law test. 2 limitations: Only within
Canada, and only applies to common law provinces.
 In the US, states are required to give full faith and credit to the judgments of other states and
in
 Morguard, the common law was modified to accept this kind of idea.
POINT: The court of one province will recognize another as long as the original provincial
court had a real and substantial connection to the case.
Hunt v. Lac D’amiante du Quebec Ltee [1993] p. 123
Facts:
 There is legislation in Quebec (Business Concerns Records Act) adopted in 1950s, the
purpose of which is to protect Quebec companies form being sued outside Quebec. It says that a
company in Quebec cannot provide documents in response to subpoena issued by foreign court.
 Hunt was suing Quebec based company (asbestos producer) in BC.
 Company did not give any documents, because of act.
Issue:
Must documents be produced? Is the statute valid?
Held:
Yes. No.
Ratio:
 Elevated the Morguard principle to a principle of constitutional law.
 As a matter of constitutional law, courts of one Canadian province cannot refuse to
enforce judgment of another Canadian province provided there was real and substantial
connection.
 Moreover, legislator of one province cannot interfere with litigation provided there was
real and substantial connection.
 Here, the Quebec legislation is unconstitutional within Canada. B.C. courts properly had
jurisdiction and were properly hearing case. There was real and substantial connection.
Note:
 Hunt likely renders the “asbestos provisions” of book X CCQ unconstitutional insofar as they
apply to litigation in other provinces.
POINT: Morguard’s real and substantial link principal is elevated to a constitutional
principle.
121
 The real and substantial connection test is now applied by Canadian courts with respect to
judgments rendered in US (see Braintech) and was also accepted by the SCC in Beals in the
context of foreign judgments.
Braintech Inc. v. Kostiuk [1999] p. 131
Facts:
Internet defamation case.
The plaintiff was a technology company based in B.C. The defendant was the individual who
lived in B.C.
Defendant posted comments about the plaintiff on an Internet bulletin board.
The plaintiff chose to sue in Texas since those courts are generous to plaintiffs and the defendant
probably did not have means to get himself to Texas.
The defendant did not challenge jurisdiction, did not show up and judgment rendered for plaintiff
(default).
Plaintiff then comes to B.C. to try and enforce his judgment.
Issue:
Can the plaintiff enforce his judgment in B.C.?
Held:
No.
Ratio:
Court says that it is obliged to recognize foreign judgments where there is a real and substantial
connection. Here the test isn’t met – the defendant had no connection to Texas, except that the
bulleting board could have been viewed by someone in Texas. There was no evidence that
anyone had actually seen it.
Conditions needed to give foreign jurisdiction:
1. Real and Substantial connection.
2. Judgment must be final and conclusive. If appeal was under way, would not be enforced.
3. Public policy. Will Ontario public policy in some way be infringed by enforcing foreign
judgment?
4. Judgment must not have been obtained by fraud.
There are 3 additional defences to deny enforcement on top of lack of real and substantial
connection (from Beals):
 The judgment must not have been obtained by fraud.
 The judgment must have been in accordance with Natural Justice.
 The laws applied must have been in accordance with Public Policy.
Old North State Brewing Co. v. Newlands Services Inc. [1998] p. 134
Facts:
The plaintiff is based in North Carolina, suing defendant based in BC.
BC defendant does not contest, and so default judgment is rendered by court.
Contract included attornement clause: This agreement will be governed by and…according to
laws of BC and parties will attorn (submit) to courts of BC.
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In its award, court calculates actual compensatory damages to be $300, 000. Under NC statute, it
awarded treble damages = $900, 000. Also ordered punitive damages of $250, 000 and
attorney fees. Final judgment = $1.2 million.
NC plaintiff comes to BC to ask that judgment be enforced (no assets in NC).
Issue:
Should the NC judgment be enforced?
Held:
Yes.
Ratio:
BC court looks at jurisdiction. Applied real and substantial connection test, and concluded there
was such a real and substantial connection to NC: One of parties was in NC, damages were
suffered in NC, Contract was to be performed in NC, etc.
Court then looked at law. NC court applied NC law, not BC law. Court held that this is not
grounds to refuse to recognize judgment. Moreover, even with a clear choice of law clause, NC
court is entitled to assume that BC law and NC law are the same, until someone proves
otherwise, which was not done here.
Court looked at attornment clause and concluded that this clause did not mean that parties must
necessarily sue in BC, so it was satisfied that NC court had jurisdiction.
On public policy, defendant argued it was offensive to enforce unreasonable judgment (triple
damages). BC court concluded that treble damages provision is not offensive in Canada.
Public policy limitation is narrow, there cannot be said to be in Canada a problem with treble
damages.
Analogy to Foreign Extraterritorial Measures Act: AG Canada is given discretion to declare
treble damages award unenforceable in anti-trust matters. Court held that if there is power to
declare it unenforceable in this instance, it must in general be enforceable. Punitive damages
and attorney fees not problematic either.
Beals v. Saldanha [2003], not in CB
Facts:
 The Saldanha’s, ON residents, owned a vacant lot in FL.
 They received an unsolicited offer to purchase the lot for $8 000 from the Beals’ real estate
agent.
 The written offer was for “lot 1” but the Saldanha’s informed the real estate agent that they
actually owned “lot 2” and the real estate changed the offer to indicate as much.
 The Beals’ began to build a mode home on “lot 1”, which they did not own, and when they
found out that they did not own it, they sued the Saldanha’s.
 Their statement of claim said they were suing for damages “in excess of $5000”, which is
customary in FL. The Saldanha’s filed a defence but the Beals’ dismissed the suit because they
filed in the wrong county.
 The Beals’ re-filed in the correct county in the same way but also alleged fraud and
mentioned treble damages and punitive damages. The Saldanha’s re-filed the exact same
defence.
 The Beals’ then filed an amendment and the Saldanha’s didn’t respond with a defence.
Under FL law, if you don’t file a defence with each amendment, you can be found in default.
123
 The Saldanha’s received notice of a jury trial to determine damages (having been found in
default) and did nothing. The Beals’ were awarded $210 000 in damages plus $50 000 in
punitive damages.
 When the Saldanha’s were notified about this, they called a ON lawyer who told them that
the judgment was unenforceable in ON so they did nothing.
 The Beals’ then sought to have the judgment enforced in ON and in the next few years, the
value of the judgment grew to $800 000 with interest.
 At trial, both parties conceded that the FL courts had jurisdiction pursuant to the “real and
substantial connection” test.
Issue:
 Should the ON Courts recognize this judgment?
Held:
 Yes.
Ratio (Major):
 In Morguard, the SCC laid down the rule for enforcement of foreign judgments in the interprovincial context – the “real and substantial connection” test. Courts of one province should
recognize and enforce the judgments of other provinces when they had jurisdiction – namely, a
real and substantial connection to the litigation.
 International comity and the prevalence of international cross-border transactions and
movement call for a modernization of private international law. The principles set out in
Morguard, and further discussed in Hunt, can and should be extended beyond the recognition of
inter-provincial judgments, even though their application may give rise to different considerations
internationally. Subject to the legislatures adopting a different approach by statute, the "real and
substantial connection" test should apply to the law with respect to the enforcement and
recognition of foreign judgments.
 The real and substantial connection test was met in this case – the dispute arose out of a
contract entered into over property in Florida. The Saldanha’s had an obligation to defend
themselves or contest jurisdiction.
 Once the real and substantial connection test has been made out, Canadian courts should
enforce foreign judgments unless one of 3 defences has been made out:
1.
Fraud Defence:

As a general but qualified statement, neither foreign nor domestic judgments will be
enforced if obtained by fraud. Inherent to the defence of fraud is the concern that
defendants may try to use this defence as a means of relitigating an action previously
decided and so thwart the finality sought in litigation. The desire to avoid the relitigation
of issues previously tried and decided has led the courts to treat the defence of fraud
narrowly. It limits the type of evidence of fraud which can be pleaded in response to a
judgment. If this Court were to widen the scope of the fraud defence, domestic courts
would be increasingly drawn into a re-examination of the merits of foreign judgments.
That result would obviously be contrary to the quest for finality.

Fraud going to jurisdiction can always be raised before a domestic court to challenge the
judgment. On the other hand, the merits of a foreign judgment can be challenged for
fraud only where the allegations are new and not the subject of prior adjudication. Where
material facts not previously discoverable arise that potentially challenge the evidence
that was before the foreign court (this means that the defendant must have prove that the
exercise of due diligence would not have turned up the new facts), the domestic court can
decline recognition of the judgment.
124

In this case, any fraud could have been discoverable had the Sladanha’s defended this
claim – they were not duly diligent. As such, the defence was not made out.
2.
Natural Justice Defence:

A condition precedent to that defence is that the party seeking to impugn the judgment
prove, to the civil standard, that the foreign proceedings were contrary to Canadian
notions of fundamental justice.

If the foreign state's principles of justice, court procedures and judicial protections are not
similar to ours, the domestic enforcing court will need to ensure that the minimum
Canadian standards of fairness were applied. If fair process was not provided to the
defendant, recognition and enforcement of the judgment may be denied.

The Saldanha’s argued that because the claim was for an “amount exceeding $5 000”,
they did not have adequate notice of the extent of their financial jeopardy. When a party
owns land in a jurisdiction, transacts in that jurisdiction and gets sued in that jurisdiction,
however, they have a duty to take steps to learn the rules of procedures. The notice that
they received is fair game in Florida.

This defence was not made out.
3.
Public Policy Defence:

This defence prevents the enforcement of a foreign judgment which is contrary to the
Canadian concept of justice. The public policy defence turns on whether the foreign law
is contrary to our view of basic morality.

There was no evidence that the Florida procedure would offend the Canadian concept of
justice.
 The parties agreed that the Florida court had a real and substantial connection to the action
launched by the respondents. Having properly taken jurisdiction, the judgment of that court must
be recognized and enforced by a domestic court, provided that no defences bar its enforcement.
None of the existing defences of fraud, natural justice or public policy have been supported by the
evidence. Although the damage award may appear disproportionate to the original value of the
land in question, that cannot be determinative. The judgment of the Florida court should be
enforced.
Dissent (Binnie):
 The Saldanha’s have successfully made out the Natural Justice defence.
 The notice was not proper since the Saldanha’s had no way of knowing that an $8 000 sale
could result in a $800 000 judgment.
Dissent (Lebel):
 The enforcement of this judgment, which has its origins in a straightforward sale of land for
US$8,000 and has now grown to well over C$800,000, is unusually harsh. In my view, our law
should be flexible enough to recognize and avoid such harshness in circumstances like these,
where the respondents' original claim was dubious in the extreme and the appellants are guilty of
little more than bad luck. To hold that the appellants are the sole authors of their own misfortune,
it seems to me, is to rely heavily on the benefit of hindsight; and to characterize the respondents'
case in the original action as merely weak is something of an understatement. The implication of
the position of the majority is that Canadian defendants will from now on be obliged to
participate in foreign lawsuits no matter how meritless the claim or how small the amount of
damages in issue reasonably appears to be, on pain of potentially devastating consequences from
which Canadian courts will be virtually powerless to protect them.
 The Extension of the “Real and Substantial Connection” Test to Foreign-Country Judgments:
The Morguard rule w/r/t inter-provincial disputes is justified because it is a "constitutional
imperative", inherent in the relationship between the units of our federal state, that each province
must recognize the properly assumed jurisdiction of another, and conversely that no court in a
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province can intermeddle in matters that are without a constitutionally sufficient connection to
that province. Comity, in the international context is not an enforceable duty but is more of a
convenience and courtesy. As such, the "real and substantial connection" test should apply to
foreign-country judgments, but the connections required before such judgments will be enforced
should be specified more strictly and in a manner that gives due weight to the protection of
Canadian defendants without disregarding the legitimate interests of foreign claimants.
 There is less hardship in terms of litigating in another province rather than another country.
Lebel is willing to enforce foreign judgments but will do so more strictly because at the end of the
day, it is a Canadian defendant being sued outside of Canada and he needs to be protected.
 Defences: Since the application of the Morguard principles to the international context have
broadened the scope of foreign judgments that are enforceable in Canada on their face, the
defences available to Canadian defendants should be broadened to ensure that there is an
appropriate balance.
1.
Public Policy Defence:
 The defence of public policy should not be reserved for such shockingly immoral laws that
one would be hard-pressed to find a non-hypothetical example of the kind of law that
would engage it. It should also apply to foreign laws that offend basic tenets of our civil
justice system. Among these, I would include the idea that civil damages should only be
awarded when the defendant is responsible for harm to the plaintiff, and the rule that
punitive damages are available when the defendant's conduct goes beyond mere
negligence and is morally blameworthy in some way. These are basic principles of justice
that are reflected in some form in most developed legal systems, although the particular
form in which they are expressed may vary.
2.
Fraud Defence:
 The rule that the defence of fraud must be based on previously undiscoverable evidence is a
reasonably balanced solution. would not, however, rule out the possibility that a broader
test should apply to default judgments in cases where the defendant's decision not to
participate was a demonstrably reasonable one. If the defendant ignored what it
justifiably considered to be a trivial or meritless claim, and can prove on the civil
standard that the plaintiff took advantage of his absence to perpetrate a deliberate
deception on the foreign court, it would be inappropriate to insist that a Canadian court
asked to enforce the resulting judgment must turn a blind eye to those facts.
3.
Natural Justice Defence:
 Notice is adequate when the defendant is given enough information to assess the extent of his
or her jeopardy. This means, among other things, that the defendant should be made
aware of the approximate amount sought.
 A requirement of particular relevance to this appeal is that adequate notice must include
alerting the defendant to the consequences of any procedural steps taken or not taken, to
the extent that those consequences would not be reasonably apparent to someone in the
defendant's position.
 Proper notice also requires alerting the defendant to the allegations that will be adjudicated at
trial. The defendant must be informed, by the pleadings or otherwise, of the basis on
which damages are sought and the case to be answered.
 The Natural Justice Defence has been made out since the Beals’ did not provide the
Saldanha’s with enough information to adequately assess what their financial jeaprdy would be
and what steps to take to defend the litigation.
 Even if the natural justice defence did not apply, however, I would hold that this judgment
should not be enforced. The circumstances of this case are such that the enforcement of this
judgment would shock the conscience of Canadians and cast a negative light on our justice
system. The appellants have done nothing that infringes the rights of the respondents and have
certainly done nothing to deserve such harsh punishment. Nor can they be said to have sought to
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avoid their obligations by hiding in their own jurisdiction or to have shown disrespect for the
legal system of Florida. They have acted in good faith throughout and have diligently taken all
the steps that appeared to be required of them, based on the information and advice they had. The
plaintiffs in Florida appear to have taken advantage of the defendants' difficult position to pursue
their interests as aggressively as possible and to secure a sizeable windfall.
 There are also statutory rules: Reciprocal Enforcement of Judgments Act (p.139). This act
provides for a simplified mechanism for enforcement of foreign judgments. Plaintiff must only
make motion to Superior Court of Justice, asking court to register judgment as if it was judgment
of Ontario courts (s.2).
 S. 3 creates a presumption that judgment will be registered unless (7 exceptions):
1. Original court acted without jurisdiction (under foreign rules).
2. Must demonstrate 1 of the following 3:
a. Defendant was not carrying on business in the foreign jurisdiction
b. Defendant was not Ordinarily resident in the foreign jurisdiction
c. Defendant had not Voluntarily submitted to the foreign jurisdiction
3. Plaintiff must show that there was valid service on defendant or appearance by defendant
4. Judgment was obtained by fraud
5. There is an appeal pending
6. Public policy
7. Defendant would have had good defence if action were brought on original judgment
(common law enforcement mechanism). Hamilton: This is meant to incorporate by
reference the common law defences, namely jurisdiction, not final, fraud and public
policy. Most of those are already covered elsewhere in the list of exceptions.
 This is time saving device. If you can’t bring yourself within these rules, fall back on more
broad common law rules (real and substantial connection).
 Reciprocating states are 8 common law provinces + territories. Quebec had been very stingy
on recognition of foreign judgments, so it has been excluded.
 There are other mechanisms: UK Act (UK-Ontario), Support orders
QUEBEC
 Prior to CCQ, it was very difficult to enforce foreign judgment in Quebec. Plaintiff was
required to take action on foreign judgment, but Quebec courts had significant powers to review
on merits (if assets were in Quebec, and you were sued abroad, had option of defending case
abroad, and if lost, when plaintiff came to Quebec to enforce, could raise same grounds again OR
could let plaintiff win default judgment and only raise grounds in Quebec)
 Some treaties allowed recognition of foreign judgments (e.g., with France, in custody
manners)
 Since January 1, 1994, Quebec has taken more modern approach. Now have articles 31553168 CCQ and arts. 785-786 CCP.
 There is now an application for registration based on the grounds set out in the CCQ.
 CCP 785: An application for recognition and enforcement of a decision rendered outside of
Quebec is made by way of a motion to institute proceedings. The time limit within which to
appear is 20 days and the application may not be presented before at least 40 days have elapsed.
CCQ 3155 – creates a presumption of enforceable judgment: A Québec authority recognizes
and, where applicable, declares enforceable any decision rendered outside Québec except in the
following cases:
(1) the authority of the country where the decision was rendered had no jurisdiction under the
provisions of this Title (CCQ 3164-3168);
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 3164 CCQ: Mirror principle: We’ll recognize your jurisdiction if we would have had
jurisdiction in the same circumstances. Incorporates substantial connection test as well.
If we would have had jurisdiction in the circumstances, but there was no substantial
connection, we will not recognize your jurisdiction.
 CCQ 3168: personal actions of a patrimonial nature, the jurisdiction of a foreign
authority is recognized only in the following cases (excludes 3164 in personal actions of
personal nature):
1. the defendant was domiciled in the country where the decision was rendered;
2. the defendant possessed an establishment in the country where the decision
was rendered and the dispute relates to its activities in that country;
3. a prejudice was suffered in the country where the decision was rendered and
it resulted from a fault which was committed in that country or from an
injurious act which took place in that country;
4. the obligations arising from a contract were to be performed in that country;
5. the parties have submitted to the foreign authority disputes which have arisen
or which may arise between them in respect of a specific legal relationship;
however, renunciation by a consumer or a worker of the jurisdiction of the
authority of his place of domicile may not be set up against him;
6. the defendant has recognized the jurisdiction of the foreign authority
 Compare 3148 (where Quebec has jurisdiction in patrimonial cases) to 3168:
3148
1. Domicile OR residence
2. Establishment + Act
3. Fault/Damage/Act/
One of obs was to be performed
4/5. Submission
3168
1. Only Domicile
2. Establishment + Act
3. Prejudice + Fault or Act
4. Obs under K (all obs)
5. Submission
6. Recognized
 There is quite a gap between 3148 and 3168.
 Note that 3168 may be unconstitutional in the inter-provincial context.
 3165 (1): The jurisdiction of a foreign authority not recognized where, by reason of
subject matter or an agreement between the parties, Quebec law grants exclusive
jurisdiction to its authorities to hear the action which gave rise to the foreign decision.
3151: Quebec authority has exclusive jurisdiction to hear in first instance all actions
founded on liability under article 3129. Where 3129 gives exclusive authority to Quebec,
must litigate in Quebec. 3129: Application is imperative in matters of civil liability for
damage suffered as a result of exposure to or the use of raw materials originating in
Quebec (i.e., asbestos).
 Under Moguard and Hunt, Canadian court must recognize judgment rendered by
another Canadian court where there is real and substantial connection. So even if don’t
meet 3168 criteria, Quebec court may be required by Moguard and Hunt to recognize
Canadian decision. In particular, for asbestos liability, if you sue in BC, although Quebec
court under 3165 would refuse to recognize and enforce, that provision would be
unconstitutional to the extent that it requires the QC court to not recognize BC judgment.
(2) The decision is subject to ordinary remedy or is not final or enforceable at the place where it
was rendered;
(3) The decision was rendered in contravention of the fundamental principles of procedure;
(4) A dispute between the same parties, based on the same facts and having the same object
has given rise to a decision rendered in Québec, or is pending before a Québec authority, or
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has been decided in a third country and the decision meets the necessary conditions for
recognition in Québec;
(5) The outcome of a foreign decision is manifestly inconsistent with public order as
understood in international relations;
(6) The decision enforces obligations arising from the taxation laws of a foreign country
(CCQ 3162 – exception is if they enforce our tax laws).
 3156 CCQ: Default judgments will not be enforced if the plaintiff cannot prove proper
service. The courts can still refuse to enforce default judgments where the defence can show that
it had inadequate notice.
 3157 CCQ: We will not refuse recognition or enforcement on sole ground that foreign court
applied different law than we would have applied.
 3158 CCQ: No examination on merits.
Cortas Canning v. Suidan Bros Inc. [1999] p. 144
Facts:
Action in unfair competition brought before Texas court.
Plaintiff was Lebanese company with Texas subsidiary.
Defendants based in Quebec.
To satisfy Texas court that it had jurisdiction, plaintiff demonstrated that defendant’s products
were available in Texas (purchased $96 worth of its goods there – so carrying on business in
Texas).
Default judgment rendered (defendant did not appear).
Issue:
Jurisdiction?
Held:
No.
Ratio:
Must go to CCQ 3155 and identify ground as justifying court’s refusal to enforce. Here, court
focused on question of jurisdiction under 3164-3168. Plaintiff is exercising jurisdiction on
purchase of $96 worth of defendant’s product. This is not prejudice that gives rise to $9,000,000.
No substantial connection
Also argued public policy. Court held that $9,000,000 is so disproportionate with amounts
awarded in similar situations in Quebec/Canada that could be regarded as non-conforming with
public policy.
Notes:
Why did the judge refer to substantial connection? This is a personal action of a patrimonial
nature which calls for examination under 3168 and not 3164. 3168 des not require a “real and
substantial connection”.
3168 (3) appears to have been met in this case: The fault and the prejudice occurred in TX.
It seems like QC’s rules would lead to the opposite conclusion of Beals v. Saldanha.
VIII. The Parties
A. The Plaintiff
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1. Capacity/Quality
 Straightforward notion.
 Same rules applicable to plaintiffs and defendants and other parties to litigation.
QUEBEC
 See arts. 56-60 CCP.
 General rule: Any person who is able to fully exercise his/her rights can be a party to
litigation.
 A person who is 18 or older and who is not under legal disability is able to sue and be sued
(art. 4 CCQ)
 A Minor represented by tutor can sue.
 Incapable person assisted by advisor (art. 258 CCQ) or represented by curator or tutor can
sue.
 Where represented by curator or tutor, litigation must be brought in name of tutor or curator
in capacity (art. 59(3) CCP)
 If person (legal or physical) is domiciled outside Quebec, arts. 57 and 58 CCP provide that
foreign law applies (if foreign law allows them to litigate, QC will respect that).
 For legal persons, art. 301 CCQ says that legal persons have full enjoyment of civil rights.
 For other structures (sole proprietorships, partnerships, unincorporated associations), more
complicated:
Sole proprietorships
 For sole proprietorships, there is not separate legal entity that can sue or be sued. It is the
person behind sole proprietorship who can sue or be sued.
 There are registration requirements in Quebec, so can find out person behind sole
proprietorship.
 Art. 115 CCP: If cannot identify defendant, under 115(3) or (4), can sue and designate
defendant by name that identifies defendant clearly. So if really don’t know who is behind sole
proprietorship, can name “Monkland Florist” as defendant.
Partnerships
 For partnerships, for certain purposes it is treated as separate legal entity. For other purposes,
it is simply a group of people who have gotten together and own property in common.
 Art. 2225 CCQ provides that partnerships can sue and be sued under partnership name. But
where you get judgment against partnership, judgment can only be executed against partnership
property. If there is not enough property to satisfy debt, must bring separate recourse under 2221
CCQ.
Unincorporated associations
 Unincorporated associations do not have legal capacity, cannot sue or be sued. Dealt with in
2267-2279 CCQ. 2271: Where unincorporated association wants to sue, directors are entitled to
bring proceeding on behalf of association. To sue, sue directors. Can bring action in name of
association (art. 115 CCP).
 Judgment can only be exercised against property of association (by directors in trust, or by
members in common). Under 2275, if there is not enough, can then go after property of directors
who approved decision or against members who have not paid dues.
What happens if a party has no capacity?
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 If litigation is framed with party that does not have capacity - under 165(2) CCP, action can
be dismissed.
 Under art. 167 CCP, the grounds for dismissal in 165 can be raised at any time.
 Problem can typically be fixed. 166 CCP: If motion is made, plaintiff can ask for delay to fix
problem. So capacity issues are not particularly serious.
ONTARIO
 Similar to QC
 Rules 7-10: Minors, mental incapacity, absentees. Each is dealt with by litigation guardian
who is responsible to court and to individual.
 There are specific rules dealing with partnerships (R. 8.01(1)). Can be brought using name of
partnership. Judgment against partnership is enforceable in principle only against partnership
property unless proceeding was served on individual partner or judge has authorized execution
against assets of partner.
 For sole proprietorships, 8.07. Can sue or be sued using business name, but judgment
enforceable only against business assets unless sue personally or get permission of judge.
 NO specific rules on unincorporated associations, which suggests that members as whole
must sue or be sued. Directors can sue or be sued.
 Capacity problem will result in dismissal of action (R.21.01(3)(b)), but plaintiff can ask for
permission to fix, even on retroactive basis.
2. Interest to sue/Standing
 Looking at this particular plaintiff, this particular defendant. Asking if plaintiff is the right
person to bring this action.
 Straightforward in private law context, difficult in public law context.
Private law
 Starting point is art. 55 CCP: whoever brings an action at law…to obtain a pronouncement
upon the existence of a legal situation, must have a sufficient interest therein.
 Art. 165(3) CCP: Defendant can ask for dismissal if plaintiff has no interest in suit.
 Can be raised at any time.
 Unlike capacity, difficult to remedy. Wrong person is suing, must substitute right plaintiff.
 In typical private law case, plaintiff is asking for money, return of property, etc. (recognition
of something concrete). Must ask 2 questions:
1. Is plaintiff asking for something for himself? A can’t ask that B pay money to C.
2. Is plaintiff entitled to that thing? The issue is where there are different parties who may
be entitled to remedy (e.g., does right belong to shareholder or company?/the insurance
company or the insured?)
Muller v. Ste. Marie [1971] p. 143
A taxi was damaged and the manager of the taxi company brought an action.
The case was dismissed as the manager was not he proper plaintiff – the owner of the cab was.
 59 CCP: A person cannot use the name of another to plead – you cannot sue on behalf of
someone else. This means that you can only sue where you have an interest.
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Jeunes Canadiens Pour une Civilisation Chrétienne v. La Fondation du Theatre du NouveauMonde [1979] p. 144
Facts:
Asked that the play Les fees ont soif stop production as it was risking severe moral, spiritual,
human and cultural prejudices.
Issue:
Does the organization (Jeunes Canadiens) have an interest?
Held:
No.
Ratio:
Looks at CCP 55 and the notion of “sufficient interest.”
Says that the plaintiff must show that they personally suffered a harm distinct from the harm
suffered by the society.
Public law
 In the public law context, interest is more interesting – the more complicated factor is that
you have a plaintiff that is asking for a recourse that will affect others (ex: a challenge to the
constitutional validity of a law).
 Courts are concerned about this for a number of reasons. Courts do not want to have to deal
with busybodies – they want to deal with genuine issues. The other issue is that our adversarial
system works under the idea that there will be 2 strongly interested parties arguing and if one
party doesn’t have enough of an interest, the court might not be hearing the best arguments.
 There are many potential plaintiffs. Is this the right one? Want to make sure that argument is
presented to court in best possible way.
Canadian Council of Churches v. R. [1992] Common Law, p. 146
Facts:
The Canadian Council of Churches represents the interests of a broad group of member churches.
It coordinates the work of the churches aimed at the protection and resettlement of refugees.
Parliament passed amendments to the Immigration Act and the Council has commenced an action
seeking a declaration that many if not most of the amended provisions violated the Charter and
the Canadian Bill of Rights.
Issue:
Does the Council have standing?
Held:
No.
Ratio:
The concern about the allocation of scarce judicial resources and the need to screen out the mere
busybody are considerations for standing.
The granting of public interest standing is not required when, on a balance of probabilities,
it can be shown that the measure will be subject to attack by a private litigant. The
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principles for granting public standing set forth by this court need not and should not be
expanded.
When public interest standing is sought, consideration must be given to three aspects: (1) is there
a serious issue raised as to the invalidity of legislation in question? (2) has it been established
that the plaintiff is directly affected by the legislation or if not does the plaintiff have a genuine
interest in its validity? and (3) is there another reasonable and effective way to bring the issue
before the court?
Branch 3 serves to guard against litigation by the busybody.
Here, there was probably a serious issue of invalidity, obviously a genuine interest, however, (3)
was not satisfied. The legislation directly affects all refugee claimants in this country. Each one
of them has standing to initiate a constitutional challenge to secure his own right under the
Charter.
POINT: Public interest group will get standing if it raises a serious issue, has been directly
affected or has a genuine link to the validity of the cause and there is no other reasonable
way to bring the issue before the court.
The Queen v. Harris [2000] p .150
Facts:
Harris is a member of an organization that seeks to ensure the fair administration of the taxation
system.
He bought an action claiming that the MNR illegally or improperly or for ulterior motives
provided preferential treatment to a taxpayer (Bronfman).
Issue:
Standing?
Held:
Yes.
Ratio:
1. Notes that a court should not decline to determine it on the ground that because of its policy
context or implications it is better left for review and determination by the legislative or
executive branches of government.
2. On the serious issue criteria, the issue he raises are far from frivolous – he raises a serious
issue.
3. He has a genuine interest in the issue as he is a taxpayer and is a member of an
organization.
4. On the issue of whether there is no other reasonable and effective manner in which the issue
may be brought before the court, here, there isn’t. A taxpayer who was allegedly was given
preferential tax treatment will not bring an action, nor will the branch of government that has
preferred him.
POINT: see an application of Canadian Council of Churches with different end results.
L’Association des proprietaires des Jardins Tache v. Enterprises Dasken [1971] p. 155
Facts:
Hull had issued building permits to builder to construct new buildings.
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Plaintiff asked for revocation of the permits, on grounds that they had been issued contrary to
zoning laws. Also asked for an injunction and for an order to demolish what had been
constructed.
There were two plaintiffs: (1) an incorporated association of members who were homeowners in
the area, and the other (2) Mme. Brossard who owns a house in the area.
Issue:
Who had standing?
Held:
Association had no interest, Brossard did.
Ratio:
Association had no interest – it does not own a house and cannot exercise rights that belong to the
members.
Brossard is a homeowner – her interest is in preserving the single family, residential character of
the neighbourhood and this was a sufficient interest. She is an appropriate plaintiff because the
value of her home is affected and so is her lifestyle.
Dissent:
She must show interest peculiar to herself – she must differentiate herself from the other
members.
Hamilton:
The dissent sets too high a standard: this standard would make it basically impossible to bring a
suit. Since all the neighbours have the exact same interest, according to the dissent, none would
have an interest to sue. This is clearly stupid.
 The suggestion has been made that the public interest standing rules are different in Quebec
than those in the common law above, but they were applied by the SCC in Quebec in Conseil du
Patronat v. CSST [1991] 3 SCR 685.
3. Vexatious Proceedings
 Because of past conduct as litigant, a person may lose right to be a plaintiff.
 S. 140 CJA p. 155: where a judge of the superior court of justice is satisfied, on application,
that a person has persistently and without reasonable grounds, (a) instituted vexatious
proceedings in any court; or (b) conducted a proceeding in any court in a vexatious manner,
the judge may order that, (c) no further proceedings be instituted by the person in any court; or
(d) a proceeding previously instituted by the person in any court not be continued.
 No further proceeding may be instituted except by leave of a judge.
 Courts don’t use this often because it is a serious restriction on individual rights but it is
appropriate in exceptional cases.
 S. 140 is not in Quebec, but CCP 46 which says that the courts and judges have all the
powers necessary for the exercise of their jurisdiction gives broad powers to the court to deal with
cases that have no remedy at law. As such, this power exists in QC.
Re Lang Michener and Fabian [1987] p. 156
134
Facts:
Mr. Fabian – an unsuccessful plaintiff in a motor vehicle accident case.
Sued the doctor who testified against him for $12MM.
Thrown out. Also thrown out at the CA. Sued for $32 MM vs. the doctors and lawyers. Sup. Ct.
threw it out. CA threw it out. CA threw it out and SCC says no way.
Further – a construction case – was successful to a certain extent, but the cross-demand was also
successful. CA says no and SCC says no.
Started another new action vs. the defendants for the $3.5 MM, an action for $3 MM vs. his old
lawyers, and one for $9.25MM vs. his current lawyers.
All dismissed re: no reasonable cause of action.
The new lawyers – Lang Michener, sue him and asks the court to limit this man’s ability to sue.
He has been condemned to costs every time, but is insolvent so it never really mattered.
Held:
The Court described a vexatious proceeding as one where you keep on losing and then try to retry
the case in a slightly new way.
Barred from suing anyone in Ontario w/out the judges’ permission.
4. Multiple Plaintiffs (Class Actions)
 How do you structure a recourse on behalf of a number of plaintiffs?
 Must distinguish 2 circumstances in which this can come up:
1. Everyone in group is looking for single thing (e.g., declaratory judgment, injunction)
2. Group is looking for something different on behalf of each member (e.g., damages)
 In the 1st circumstance, where everybody wants the same thing, you really only need 1
plaintiff who has an interest. Anybody who has an interest can be the plaintiff. Ex: In Jardins
Tache, any homeowner in the neighbourhood could have been the plaintiff. It wouldn’t matter if
no other neighbour sued or if they all did. The only difficulty is finding the right plaintiff (as in
the “standing cases”).
 The 2nd circumstance is more difficult to deal with.
2nd situation
 Where you’re making claim for damages payable to each member, can’t have one person
come forward. Run into question of interest.
 Art. 59 CCP: Person cannot use name of another to plead. This has been held to mean that
Mme. Brossard (Jardins Tache) cannot ask for damages for herself and for everyone else in the
group.
 There are several alternatives to manage this:
(1) Individual action - A vs. D, B vs. D, C vs. D: Each of 3 plaintiffs A, B, C can bring a separate
action against defendant D. No problem arises with interest. But there are other 3 problems that
arise: expensive, inefficient, and danger of contradictory judgments.
a) Joinder of actions (variation on 1): At the time that each of the 3 cases by the plaintiffs are ready for
trial, the parties can decide to have one trial together. This allows one judge to hear all of the evidence.
This eliminates the risk of a contradictory judgment since one judge will issue all 3 judgments.
 271 CCP: The court may also order that several actions brought before it, whether or not
involving the same parties, be tried at the same time and decided on the same evidence.
 This mechanism is still expensive, because each case proceeds on its own until inscription,
but better than 3 individual actions and there is no risk of contradictory judgments.
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 If each claim is for a different amount of damages, different claimants would be subject to he
jurisdiction rationae materiae of different courts. 273 CCP: Case in Court of Quebec and
Superior Court – Case in Court of Quebec stayed, case in Superior court proceeds, and then used
as precedent for Court of Quebec case.
 In Ontario, Rule 6.01(1): Where there are different actions, and have question of law or fact
in common, or arise as result of the same transaction or occurrence, court can order that they be
heard at same time (consolidated). The Court can also consolidate hearings at its own discretion.
(b) Test case (another variation).
 271 CCP: it may also order … that one be tried and decided first and the others meanwhile
stayed.
 A court which has several similar cases pending, the court will choose one which will be
heard on the merits. The others will be suspended. The judgment in that case will be applied to
the other cases where the judgments are pending.
 A big problem here is that it is difficult to impose the outcome of the test case on every client
if they have not been represented by counsel of their choice. The test case is designed to reduce
the burden on the courts by making a particular outcome apply to everybody. After this, there
would still be a need for individual trials for specific issues.
 This can proceed formally or informally. Formally: Court sets structure: “If A wins, B and C
win automatically” versus “If A wins, only have to deal with causation issue in B and C”
(2) Joinder of plaintiffs: A, B and C vs. D
 Plaintiffs join in a single action. Plaintiffs have to get organized beforehand, hire single law
firm, join together in single proceeding.
 CCP 67: two or more persons whose claims have the same juridical basis or raise the same
points of law and fact may join in the same suit. The suit must be instituted before the Court of
Quebec if that court has jurisdiction in each of the claims, otherwise it must be instituted in
the superior court.
 Rule 5. 02(1) in Ontario: two or more persons represented by the same solicitor may join as
plaintiffs in the same proceedings when their claims arise out of the same transaction, they’re
dealing with the same questions of facts or law or if this would be more convenient for the
administration of justice.
 This mechanism eliminates expense, inefficiency and the risk of contradictory judgments, but
adds the burden of getting organized beforehand. Also have to finance proceeding somehow
(e.g., everyone puts money into pot, contingency fee agreement (not in Ontario)).
 If suing on behalf of large group, those who don’t want to join are left out of the group. May
end up with situation 1 (individual actions).
(3) Action by a mandatary (only in Quebec): A (B, C) v. D.
 Governed by 59(2) CCP: When several persons have common interest in dispute, anyone of
them may appear on behalf of all, if he holds their mandate.
 This is the exception to art. 59 CCP which generally forbids people to plead in the name of
somebody else.
 So can give power of attorney to 1 member of group, who is authorized to bring lawsuit on
behalf of everyone.
 Requires “common interest”: Plaintiffs must be joint owners of litigation (e.g., joint owners
of building). Doesn’t apply where each have separate loss (e.g., 3 victims of the same defects in
Ford pintos do not have a common interest).
(4) Class Action/Class Proceedings
 Quebec was first province to adopt class action, adopted in 1978. Book 9 CCP, article 999 ff.
136
 Ontario was second province to adopt. Class Proceedings Act came into force 1993. BC is
only other province that has it.
 One person asks the court to authorize him to exercise on behalf of the class.
 Note that the plaintiff need not ask the permission of other class members to litigate on their
behalf as in the “joinder of plaintiffs” situation above.
QUEBEC – Class Actions
 Class actions are w/in the exclusive jurisdiction of the SC’s (art. 1000 CCP).
 First Step: Art. 1002 CCP: The person who wants to bring the class action needs to get
authorization from the court by making a motion. The motion states the (1) facts giving rise
thereto, (2) indicates the nature of the recourses for which authorization is applied for, and (3)
describes the group on behalf of which the member intends to act. It is accompanied with a notice
of at least 10 days of the date of presentation and is served on the person against whom the
applicant intends to exercise the class action; the motion may only be contested orally and the
judge may allow relevant evidence to be submitted.
o Under 999(c), a legal person can participate as a member of a class if it had 50 or
less employees in the year preceding the class action.
o The legislation stacks the deck in favour of the class. Recent amendments make
it possible to get authorization w/o an affidavit (1002) so now, there is no right to
cross examine anybody on an affidavit. 1002 also makes it clear that there is
only oral pleading at the authorization stage. The judge has discretion as to
whether or not to allow evidence and usually, they don’t. Usually, it ends up
being a debate based on the proceeding as drafted by the representative. If
somehow, you manage to beat authorization (as defendant), the plaintiff has an
appeal as of right to the CA but the losing defendant has no right to appeal
(1010).
 Second Step: Art. 1003 CCP sets out criteria that court applies to determine appropriateness
of class action (see below).
 Third Step: If the motion is granted and the class action is authorized, the representative
must publish a notice to the members in a newspaper (1006), describing the group, the action that
was authorized and the members’ right to intervene in the action (since they will all be bound by
the outcome) as well as the members’ right to be excluded from the group.
o 1005 CCP: The judgment authorizing the class action will stipulate where
publicatio should occur and how it should be worded.
o If a member of the class does not ask to be excluded, he will be bound by the
outcome. If the class action is dismissed, no member of the class can then sue on
his own. This is fundamental difference between 67 CCP and class proceedings.
Must take positive step of withdrawing. Don’t have to go door-to-door and sign
people up.
 Fourth Step: Once the class action has been authorized, it proceeds more or less like an
ordinary case. The court, however, has a supervisory power which it does not have in a regular
case (1011-1026). This is because the rep is acting on behalf of the group, so the court protects
the group.
o 1014: If the representative wants to make an admission, it is binding on the class
unless the judge decides that it prejudices the class.
o 1025: The Court must approve the settlement negotiated by the representative.
 Fifth Step: If the class action is successful, the court may order individual or collective
recovery of damages (1028 CCP):
137
o
o
Collective recovery: one big sum is paid into a pot and the plaintiffs take their
share. Individual recovery: each plaintiff must go to court and prove his specific
loss.
The balance left after collective recovery is as the discretion of the courts (1036
CCP) – usually, the money winds up with a community organization.
Funding the Class Action
 For funding in Quebec, can use contingency fees. This is very appropriate in circumstances.
 Other alternative in Quebec is public funding. Under the Act Respecting the Class Action
(p.159), have body called “Fonds d’aide au recours collectif”. It initially was funded by the
Provincial Government. To make an application, you must describe nature of the claim and
group, set out financial circumstances, and ask for sum of money.
 Test (S.23): Will class action be brought or continued without this assistance? If so, no
public funding. If it would not proceed, it will assist.
 Funds are used to pay lawyers, experts, court costs, etc (s.29).
 There is also a mechanism for reimbursement to the fonds when the class action is successful
– under s.30, court costs awarded to the class go back to the fonds and under s.42, there is an
amount payable to the fonds which is based on a percentage of the amount recovered (see
regulation – p.161). Up to 10% of individual recoveries go the fonds depending on the amount of
the litigation and up to 70% of the balance of an unclaimed collective recovery. This is what
keeps the fund going.
The Criteria for Authorization (Step 2) - Jurisprudence
1003. The court authorizes the bringing of the class action and ascribes the status of
representative to the member it designates if of opinion that:
(a) the recourses of the members raise identical, similar or related questions of law or fact;
(b) the facts alleged seem to justify the conclusions sought;
(c) the composition of the group makes the application of article 59 [action by mandatary]
or 67 [joinder of plaintiffs] difficult or impracticable; and
(d) the member to whom the court intends to ascribe the status of representative is in a position
to represent the members adequately.
Mathon v. Hotels Delta Ltee p. 162
Facts:
Relates to condo-hotel project at St. Sauveur: 3 buildings built to run as condos.
There was agreement that unused units would be rented out as hotel rooms, with mechanism for
sharing proceeds.
Each condo owner would be entitled to a share, depending on the size of their unit, the nights that
their unit was available, etc.
Ultimately the hotel manager didn’t pay.
First attempt at recourse was class action.
Issue:
Are the conditions of CCP 1003 met so that a class action may be authorized?
138
Held:
No.
Ratio:
1003 CCP provides that a Court authorizes and ascribes…if it is of the opinion that:
(a) Recourses raise identical, similar or related questions of law or fact:
Court held that this was met – the petitioners seek to represent all investors and unit holders in a
condominium complex so their legal position with respect to the hotel is identical in all respects
except for the amounts each will obtain.
With respect to different amounts, court held that that just comes down to a simple mathematical
computation and does not affect compliance with this subsection.
(b) Facts alleged justify conclusions sought.
Court noted that this is a low standard which simple looks to preclude frivolous claims. Here, the
court does not look to characterize the legal relationship or decide if liability should be based
on delegation of payment…It is sufficient for the court to declare that this is a serious matter
and that the facts alleged seem to justify the conclusions sought or at least some of them – here
it does.
(c) Composition of group makes application of 59 or 67 difficult or impracticable.
There is preference for these 2 mechanisms. Article 67 and 59 require you to go out and get
people to sign on. This is difficult if:
(1)
Size: if the group of affected plaintiffs is large. According to the court, if the
group is 25 or smaller, it is too small for a class action. If the group is larger than 150
people, it is not reasonable to do an action by mandatary or joinder of plaintiffs. If the
group is in between 25 and 150, might be reasonable to have a class action. Here, there
were 78 condo owners.
(2)
Identity, location of the members of the class. A plaintiff cannot use art. 67
if he doesn’t know who the other plaintiffs are or where they are. Here, the owners are
all registered at city hall. For location, there a is huge difference between an action
where everyone lives on same street and where everyone lives all across the province.
Here, the members of the class were not too spread out.
(3)
Value of claims (note that this is put in doubt in Tremaine). If the claim is
for a substantial amount of money, it makes sense to contact people personally. Difficult
to apply art. 67 where the claim is small because it is difficult to track people down and
then to get their attention if you do. It is difficult to place a burden on one person to
contact all members of the class for a very small amount. If it’s a big claim, there is more
of an onus on the members of the class to join a claim. Also, the costs outweigh the
benefits. Here, thousands of dollars at stake. As such, the amounts were enough that the
plaintiffs had a sufficient interest to act on their own.
(4)
Complexity. If litigation is complicated, it makes the application of art. 67
difficult. Hard to get people to sign up if it’s hard to explain litigation. Although slightly
complex here, the co-owners are not strangers to these issues.
Court held that (c) not complied with.
(d) Member to whom court intends to ascribe status of representative is in position to
represent members adequately.
Here, the individual who came forward owned building and was administrator. Even though the
court did not need to decide on this factor, it held that the petitioner was an appropriate
representative.
Notes:
139
After the class action was dismissed, the condo owners’ association then sued but Manoir Saint
Sauveur had it dismissed since the condo association had no interest. They then tried to do an
action by mandatary but it was dismissed since not everybody had the same interest. They
successfully got a joint action authorized but lost.
POINT: see the requirements of 1003 CCP to obtain authorization for a class action. Note
that it may be idea (according to (c)) to have a big group, hard to identify, scattered all over
province, each person entitled to small amount of money, and claim complex.
Tremaine v. A.H. Robins Canada Inc. [1990] p. 167
Facts:
Involves motion for class action on behalf of all women who used a particular IUD and suffered
damages.
The petitioner became pregnant and gave birth to a stillborn child.
Note that people were injured at different times, and the nature and extent of damages were
different.
Issue:
Authorization?
Held:
S.C.: No.
C.A.: Yes.
Ratio:
[Superior Court]:
S.C. dismissed the motion claiming that the case was not an appropriate case for class action.
3 reasons provided:
1.
Issues are too different, effects vary. Only common issue is whether IUD is defective,
and when is prescription required. There were different matters of causation, damages,
etc…
2.
The petitioner was not an adequate representative since the effects on her were quite
particular and severe.
3.
Individual claims are so large and complex that it would be appropriate for each to be a
separate recourse.
[Court of Appeal]:
This court overturned lower court and authorized the class action holding that:
1.
Essential issue is whether IUD is defective, that is same for every member of group.
There will be separate proof for each member of group for causality and damage, but
don’t need all questions to be related, identical, or similar.
2.
She is adequate representative on question of whether product is defective.
3.
Size of claims is not reason to bar (CA disagrees with Delta).
POINT: Note a dismissal of a motion for authorization for a class action may be appealed.
Also, note that not all issues must be similar, just need one essential question that is similar
to everyone to be sufficient.
Class Action vs. Joinder of Plaintiffs/Action by Mandatary
140
 There is a bias in favour of joinder or action by mandatary because in a class action,
undecided members are made a part of the lawsuit but not in the other two types of joint actions.
 Difference between class action and action under 59 or 67. If there are 100 members of the
class and you have to contact everybody in the class and get them to agree to be in the class if not
a class action. If it’s a class action – everybody is in the class unless they take steps to remove
themselves from the suit. People who do nothing are members of the class in a class action and
people who do nothing are not members of the class in the action under 67 or 59.
 A class action is less work for the plaintiff – it increases the number of plaintiffs and makes
the initial plaintiff have to do less work.
 A class action makes it easier to get a lawyer to take a case on contingency.
Ontario – Class Actions
 See Class Proceedings Act, pg. 173; Law Society Amendment Act (Class Proceedings
Funding), pg. 175.
 The basic structure is similar to what we have in QC with a few significant differences.
 Conditions for certification set out in s. 5, pg. 173. Court shall certify if:
a) The pleadings or notice of application disclose cause of action (compare to CCP
1003(b));
 Note: This is a significant difference vs. QC. In QC, the representative makes a
motion for permission to institute a class action. In ON, the Plaintiff sues the
defendant and then asks the court to certify the proceeding as a class proceeding.
The difference is that in ON, the plaintiff must have a valid proceeding in order to get
it certified whereas in QC, this is not necessary for certification. In ON, a plaintiff
wanted to sue a bunch of manufacturers who made a particular product. The courts
held that the plaintiff can only sue the manufacturer from whom he bought the
product. He did not have standing to sue the others. In QC, a representative can sue
other similar manufacturers if members of the class other than him have a lien de
droit with the others. Ex: In QC, a plaintiff can sue every DVD manufacturer but in
ON, the plaintiff can only sue the manufacturer of the DVD player that he actually
bought. In ON, you’d have to get one plaintiff for every manufacturer that you
wanted to sue. You would conceptually have 3 separate recourses but ON courts
would likely certify these 3 claims into 1 class action. Another possibility is to have
3 separate class actions that would be joined at trial.
b) There is an identifiable class of two or more persons that would be represented by the
representative plaintiff or defendant (Act does not specify, but QC cases say > 25);
c) The claims or defenses of the class members raise common issues (1003(a) – note in
ON, says “common issues” which is consistent with Tremaine which says do not
need identical issues);
d) Class proceeding would be preferable procedure (1003(c) – Ont. Standard bit lower
since must just show if ‘preferable’); and
e) Representative plaintiff who, (i) can fairly and adequately represent, (ii) has produced a
plan, (iii) doesn’t have an interest in conflict with other members (1003(e)).
 In ON, you can have a class of defendants – you can sue a single defendant and then expand
your case to include all of the defendants. This works if you are suing an unincorporated
association. You would sue one member and then ask to expand the proceeding to a class
proceeding against all members of the association.
 S.3 of the Act: A defendant in more than one proceeding can make a motion to the court at
any time to have the proceedings certified against him and to have a representative plaintiff
named.
141
 Right to Appeal: In ON, there is a right of appeal for certification decisions (s.30) – unlike
QC. S.30(4): If the representative does not appeal, any member of the class can.
 Funding the Class Action:
1. There are rules on fees and disbursements set out in s.32-3 to make room for a contingency fee
in order to fund the class action.
2. Also, the Law Society Amendment Act creates a class proceedings fund which pays for
disbursements (59.3(1)) but not lawyers’ fees. ON is stingier than QC.
 Class actions enjoys 2 benefits over joinder of plaintiffs:
1. Who is covered? For joinder of plaintiffs, the only people in the class are those who sign up.
For the class action, all members are presumptively in the group unless they take steps to exclude
themselves.
2. Funding. In Quebec, there are public funds. In Ontario, limited public funding, and
contingency fees.
Nantais v. Telectronics Proprietary [1995] p. 178
Facts:
Application for certification.
Leads in pacemakers are allegedly defective.
16-25% of Leads fail, and if they do, have heart attack or more serious problems. Even if it
doesn’t fail, there will be monitoring, mental suffering, etc...
Issues:
1. Can a court include in a proposed class members outside Ontario?
2. Can people implanted with the device that’s functioning normally have a cause of action and
be included?
Held:
1. Yes.
2. Yes.
Ratio
Court looked at 3 policy reasons for class proceedings: (a) increased access to justice; (b) judicial
economy (don’t debate the same issue over and over); and (c) modification of behaviour of
wrongdoers (no one will sue individually for $0.35. but will get involved as part of a class – big
companies should know that there is a price to be for causing small damages to lots of people).
The Act is procedural and can therefore be given a liberal interpretation.
Here even those whose pacemakers have not failed will suffer mental anguish and the
inconvenience of being constantly monitored, so they have a cause of action.
With respect to a national class, the court held that given the decision in Morguard, it makes
sense for the ON courts to include non-Ontarians in the class. If a non-Ontarian wants to opt out
in the future, the jurisdictional issue can be litigated then (see Wilson, below). In the meantime,
the defendant is not prejudiced - what is he going to say? I prefer to be sued in 10 provinces?
Here, liability is common issue. The fact that there will be individual damage assessments should
not be a bar to a class action.
Therefore, certification granted. Court creates national class: everyone in country with
pacemaker.
142
Wilson v. Servier Canada [2000], p.193
A jurisdictional problem arises when a national class of plaintiffs is trying to certify a class action
in ON against a non-ON defendant. In Wilson, A Canadian class wanted to sue a French
company in ON. There is a clear jurisdictional issue here. Can the ON courts take jurisdiction
over a class of plaintiffs where it would have had no jurisdiction over some of the individual
claims (ex: a class member in MB – the fault or injury didn’t occur in ON and the Defendant is
French)? The Court said that this was OK. The court held that there are issues of order and
fairness underlying all of this. It is sufficient that there be a real and substantial connection
between ON and the defendants or between ON and the subject matter. There were people who
purchased the product and were injured by it in ON. The product was marketed in ON. This
creates jurisdiction and allows ON to take a broader jurisdiction. Another factor was that only
ON, BC and QC had class action legislation – it was only fair to include all plaintiffs so nobody
would have to take an individual recourse in their home jurisdiction. The Court also said that
there would be an opt-out available for foreign defendants. Normally, when a court creates a
national class, they will exclude members of the class who are from another province where there
is also a class action going on. Courts want to make sure that all Canadians are caught by 1 class
action or another. The manufacturer, in marketing their products throughout Canada, risks suit
throughout Canada. A defendant doesn’t have a leg to stand on by saying that he is prejudiced by
the consolidation of litigation against him. The court also said that it is not useful to have the
same issue litigated in each province. Normally, a Canadian court will only carve out QC unless
a class action was started elsewhere. The jurisdictional issue will be overcome in the interest of
efficiency and comity and because the defendant is not prejudiced by having a single class action
rather than 10 class actions.
 Class actions in Quebec are popular for bad vacations, product liability, employees trying to
recover surpluses.
 2 areas of difficulty:
1. Shareholder recourses, after issuance of false information.
 In US, can have class action for this. In Canada, there have been some attempts (Bre-X).
 There is problem here, because shareholder’s recourse is in fraudulent misrepresentation.
One of elements is reliance. Must prove that you were aware of information and relied on it.
This cannot be resolved in class action format.
 In US, have concept of “fraud on the market”. If release information, there is premise that
that information has been released into market, and relied upon.
2. Environmental – potential classes are massive.
Hollick v. City of Toronto [2001] p. 186
Facts:
Hollick complains of noise and physical pollution from a landfill.
Hollick sought certification to represent some 30,000 people who live in the vicinity of the
landfill.
Hollick complains that the landfill has unlawfully been emitting onto his own lands and onto the
lands of other class members large quantities of methane, hydrogen sulphide…loud noises and
vibrations.
Issue:
Has the certification requirement been satisfied?
143
Held:
No.
Ratio:
Look at satisfaction of the test set out in s. 5.
No dispute as to the fact that Hollick’s statement of claim discloses a cause of action – that is
satisfied.
Next, look at whether there is an identifiable class – in my view, there is. The appellant has
defined the class by reference to objective criteria; a person is a member of the class if he owned
or occupied property inside a specified area within a specified period of time. Whether a given
person is a member of the class can be determined without reference to the merits of the action.
The class has not been named completely, but is not unlimited so it is identifiable (s. 5(1)(b)).
Next, look at “whether the claims of the class members raise common issues.” Here, the
underlying question is whether allowing the suit to proceed as a representative one will avoid
duplication of fact-finding or legal analysis. Thus an issue will be common only where its
resolution is necessary to the resolution of each class member’s claim. Further, an issue will
not be common in the requisite sense unless the issue is a substantial ingredient of each of
the class members’ claims.
Here, there is no doubt that if each of the class members has a claim against the respondent, some
aspect of the issue of liability is common within the meaning of s. 5(1)(c).
The representative need not show that everyone in the class shares the same interest in the
resolution of the asserted issue; there must be some showing however that the class is not
unnecessarily broad - that is, that the class could not be defined more narrowly without arbitrarily
excluding some people who share the same interest in the resolution of the common issue.
The representative must show some basis in fact for each of the certification requirements set out
in s. 5, other than the requirement that the pleadings disclose a cause of action.
The appellant has shown a sufficient basis to satisfy the commonality requirement.
However, I cannot conclude that a class proceeding would be the preferable procedure for
the resolution of the common issue (5(1)(d)). Look at this through the policy lens – judicial
economy, access to justice, and behaviour modifications (is class action preferable to joinder,
test cases, consolidation etc.).
To decide this, court must consider whether questions of fact or law common to the members of
the class predominate over any questions affecting only individual members. There must also be a
consideration to common issues in context. Ask “given all the circumstances of the particular
claim, would a class action be preferable to other methods of resolving these claims?”
I am not persuaded that the class action would be the preferable means of resolving the class
members’ claim.
Judicial economy: any common issue here is negligible in relation to the individual issues –
while each member must establish the landfill emitted physical and noise pollution, there is not
reason to think that any pollution was distributed evenly across the geographical area or time
period specified. It is likely that some areas were affected more seriously than others.
Access to justice: this would not be served either. Here, the appellant says that the claims are so
small that arguing as a class makes it economically feasible. The court held here though that if the
claims are so small as to engage access to justice concerns, it would seem that the Small Claim
Trust Fund would provide an ideal avenue of redress.
Behaviour modification: Here, we should expect that if individual class members have substantial
claims against the respondent they will be willing to prosecute those claims individually; on the
other hand if their claims are small, they will be able to obtain compensation through Small
Claims Trust Fund – in either case, the respondent will be forced to internalize the costs of its
conduct.
144
Note:
Is this consistent with Tremane decision (IUD case)? Yes, in that court suggests that there would
be a great deal of evidence on question of whether IUD was defective (more controversial issue).
More narrow range of health problems. So common issue more substantial, individual issues less
substantial. With IUDs, not obvious that they would be defective. Here, it was obvious that there
were emissions. You must weigh the importance of the common issue.
Criticisms of the Class Action
 Plaintiffs’ lawyers get rich and plaintiffs don’t. In many cases, the amounts recovered are so
small that they don’t get distributed to the plaintiffs but the lawyers get paid. If the amount of
individual damages is small, there is nothing left for the plaintiffs. The defendants pay out but it
is not so much in the interest of the members of the class. Class actions are driven by plaintiffs’
lawyers.
 Defendants are also accused of abusing the class action system (mostly in the US). The
argument is that there are class actions where the defendant encourages the bringing of the class
action so that they can settle and avoid a bigger liability down the road.
B. The Defendant
1. Capacity
 Question of capacity is same as rules for plaintiff. Individuals over the age of majority, not
mentally disordered, and corporations.
 If you sue someone without capacity, in principle, the action ought to be dismissed. But there
is some opportunity to fix problem (ask court for permission to amend).
2. Interest
 Interest: Must sue the proper defendant. E.g., suing shareholders for breach of corporation’s
contract.
 If you choose wrong defendant, there will be motion to dismiss on the basis that there is no
cause of action (even if all facts alleged are true, no recourse against defendant).
 In Ontario, the notion is whether there is a reasonable cause of action.
3. Multiple Defendants
 A plaintiff is going to want to sue every potential defendant, to make sure he has right
defendant (he’ll sue everybody and let the judge sort it out).
 2 factors would limit ability/desire to name everybody: jurisdiction and court costs.
o Jurisdiction: Must establish jurisdiction with regard to each defendant. This is
particularly true in Quebec: have to go through 3148 for each defendant. It is
less of an issue in ON but once you’ve served one defendant in ON, you can
serve the others ex juris if you can establish that they are properly parties to the
case (17.02(o)).
o Court costs: The more defendants you bring in, the more likely you will have to
pay court costs to the defendants who get the action against them dismissed.
 Unlike Quebec, there the possibility in ON of class proceeding that involves a class of
defendants. For unassociated corporation, can sue directors, and ask that they be recognized as
representative of 100 members.
145
IX. The Issue
 There are two basic topics – 1) there are certain types of issues which cannot be litigated; 2)
to what extent can you bring 2 or more issues in one lawsuit.
 Certain types of Issues cannot be litigated: (a) issues that are moot; (b) parties have agreed to
arbitration; (c) justiciability; and (d) already decided or pending.
A. Issues that are moot
 Issues that are Moot: by the time they get to trial, the underlying facts have changed so that
they are no longer relevant.
 Once an issue is moot – a court will typically not hear it (Ex: A sues B and there is a
settlement – the Court will not care about the legal issues if there is no more basis for the
complaint).
Coca-Cola v. Matthews [1949], p. 205
Facts:
 Plaintiff allegedly found dead mouse in bottle of Coke.
 Plaintiff sues Coke for $350, lost at trial, won at appeal.
 Coke asks CA for leave to appeal to SCC. CA granted leave, felt it was sufficiently
important.
 But CA also recognized that it was unfair to force Plaintiff to go to SCC. So CA gave Coke
leave, but said that whatever the outcome, you will pay Plaintiff $350, and reimburse him his
costs.
 Coke agreed because they wanted the legal principle clarified.
Issue:
 Can the SCC hear an appeal in these circumstances?
Held:
 No.
Ratio:
 We are being called upon to deal with issue that is of interest to one of parties, but not the
other.
 Plaintiff couldn’t care less about who wins so we don’t want to get involved. We are not here
to express opinions at the whim of a party. We are here to deal with real problems. There is no
real issue.
 Need to have 2 parties arguing their position the best they can for adversarial process to work.
 It is not appropriate to use the court for a theoretical question.
LSUC v. Skapinker [1984], p. 148
Facts:
 Skapinker was challenging the LSUC’s rule that made Canadian citizenshipe a prerequisite to
be member of bar.
 By the time the matter reached the SCC, he had become a citizen. As such, he had lost his
interest to sue.
146
 But along the way, Richardson intervened, and he didn’t have citizenship.
Issue:
 Should the SCC decline to hear this case because it is moot?
Held:
 No.
Ratio:
 The SCC agreed to hear the case because it raised a novel issue that they wouldn’t otherwise
be able to hear.
 It takes longer to get to the SCC than to be a citizen so this might have been the SCC’s only
chance.
 At least there was an intervener with an interest in outcome.
R v. Mercure
Facts: Traffic offence coming out of Saskatchewan where the defendant contested his ticket on
the basis that it was in English only. Before case reached SCC, Defendant passed away. But
again, there were interveners.
SCC: Even though we don’t have accused, we will proceed because we have interveners and
there is live issue before us. Usually, a criminal appeal dies w/the accused. In this case, his
conviction was less important than the constitutional issue so they proceeded.
Tremblay v. Daigle
Facts: Tremblay had obtained injunction to prevent Daigle from having an abortion. There is
only a 22-week window of opportunity. The Quebec CA and SCC rearranged schedules to hear
case in record time. When SCC arrived, Daigle’s attorney announced that she had an abortion.
SCC: It is appropriate to hear case, render judgment. There was still live issue, in that Daigle
may have breached injunction, and therefore liable in contempt. So must pronounce on validity
of injunction. Also, this was very important issue that SCC would not typically be able to hear.
B. Arbitration
 3148(2) CCQ in Quebec.
 s. 7 Arbitration Act in Ontario.
 Both provisions force courts to stay proceedings where the parties have agreed to submit to
arbitration.
C. Justiciability
 Some issues cannot be resolved by a court. Tends to come up in public interest litigation, as
opposed to private interest litigation.
Operation Dismantle
Facts: Disarmament groups brought proceeding challenging decision to allow missile testing in
Canada. Federal Crown felt it was not justiciable.
Held: Court recognized that it could not express opinion on wisdom of Cabinet’s decision – it is
political decision, cannot be contradicted by power. However, there is justiciable issue: Did
decision contravene anyone’s right to security of the person?
147
Notes:
 The court is basically saying that Charter says Parliament can render a decision that falls
within a certain permissible range. Within range, it is question of whether Parliament made best
decision, and this is not justiciable. Justiciable issue is whether Parliament went beyond
boundaries.
 Secession Reference: Argued that it was not justiciable issue. SCC said some elements were
within political domain, but there is legal component as well.
D. Issue which has already been decided, or which is pending before
another court – Lis Pendens/Res Judicata
 Already been decided: res judicata.
 At common law, there is issue estoppel, which is variation of res judicata.
 Pending before another court: lis pendens.
QUEBEC
 Art. 165(1) CCP: Defendant may ask for dismissal if (1) there is lis pendens or res judicata
 Art. 167: The dismissal of a law suit for one of the grounds set forth in article 165 may be
urged notwithstanding the failure to do so within the time limit, but there is costs consequence.
 Criteria for res judicata set out in 2848 CCQ: Authority of final judgment is an absolute
presumption (once it has been decided, there is absolute presumption that it was decided
correctly); this is from the CCQ rules on evidence.
 This is inconsistent with 165 CCP which puts it as a motive for dismissal.
 3 identities:
1. Same cause (cause of action: same underlying facts are alleged, same legal principle is
applied, same result is being sought),
2. Same parties acting in same qualities (Father suing as father and as tutor = no res
judicata),
3. thing applied for is the same (damages claimed, property right being claimed, etc. is the
same).
 Cases have added that res judicata only exists with respect to judgments of Quebec court.
This means that you need to get a foreign judgment recognized in QC to have it be the basis of
res judicata.
 3137 and 3155(4) CCQ: Extends to foreign judgment if you would recognize foreign
judgment.
 Judgment must be final. One under appeal doesn’t create res judicata.
 Default judgment does not create absolute presumption that facts alleged are true.
 We have res judicata because we believe that once a court has reached a final resolution of an
issue, it cannot be re-opened. If it were different, lawsuits would never end. Also, we are afraid
of contradictory judgments.
 There is also an efficiency argument – we don’t want the same cases tying up our courts.
 Lis Pendens is similar to res judicata – the difference is that there is no final judgment – only
pending litigation. You are not comparing a judgment to a new litigation – you are comparing
two litigations.
 The 3 identities apply to lis pendens.
Rocois Construction v. Quebec Ready Mix [1990], pg. 213
Facts:
 RC claimed to be victim of conspiracy to fix prices.
148
 Brings action in federal courts, asking for $1 000 000 in damages for breach of Combines
Investigation Act, and alleges breaches of 1053 CCLC.
 Federal court does not have jurisdiction for 1053 CCLC when the Federal crown is not a
party, so that claim was dismissed.
 RC then sued in Superior court, asking for $1 000 000 alleging delict. Defendants make
motion to dismiss, saying lis pendens.
Issue:
 Is there Lis pendens?
Held:
 Yes.
Ratio:
 It has long been recognized that recognition of lis pendens is governed by same principles of
res judicata. As such, there needs to be 3 identities.
 The parties were the same and the damages were the same too. The only issue is whether
there is identity of cause.
 The court held that these 2 actions are essentially the same thing. The conduct which gives
rise to recourse under Act is same conduct that gives rise to recourse under 1053. The Delict is
the unlawful agreement that is prohibited by the Act.
Deschamps v. Durand [1966], pg. 222
Facts:
 2 separate actions flowing from car accident.
 The insurance company (in the victim’s name) was claiming the cost of repairs and the victim
was claiming damages as a result of the physical injuries that he sustained.
Issue:
 Is there Lis pendens?
Held:
 No.
Ratio:
 Same parties, same cause, but different damages are being clamed, therefore no lis pendens.
Hopital Ste-Jeanne v. Garneau [1959], pg. 226
Facts:
 Doctor is expelled from hospital and brings 2 separate actions: one is proceeding in
mandamus to be reinstated, another is to recover damages from having been expelled.
Issue:
 Is there Lis Pendens?
Held:
 No.
Ratio:
149
 Have same parties, same cause, but recourses have different objects (mandamus, damages),
therefore, no lis pendens.
 The Court points out that he could have joined the 2 actions together for efficiency and cost
reasons. This would also make sense because it is possible that he wins one case and loses the
other.
ONTARIO
 Res judicata, issue estoppel, and lis pendens are matters of common law, flowing from the
inherent jurisdiction of the court.
 Similar to test in Quebec (3 identities).
 Procedurally, the motion for lis pendens is made under R. 21.01(3)(c): Defendant may move
before a judge to have action stayed or dismissed on ground that another proceeding is pending in
Ontario or another jurisdiction between the same parties in respect of the same subject matter.
 For res judicata, motion under 21.01(1)(b): Party may move before a judge to strike out a
pleading on the ground that it discloses no reasonable cause of action or defence. If you litigated
an issue and lost and want to try again, the other party says that you have no cause of action
 The courts have been more flexible in terms of res judicata in ON.
Angle v. MNR [1974], pg. 228
Facts:
 Transworld Exploration builds indoor swimming pool, bar, etc., in home of Angle, who
happens to be largest shareholder of company and president of company.
 MNR considers that value of improvements is part of her revenue as taxable benefit. She
challenges taxation on basis that she will eventually pay for things.
 She loses, so she pays taxes.
 One year later, MNR is trying to collect tax due by a company called KCT.
 MNR issued a writ of garnishment, which it sends to 3rd parties saying: if you owe any money
to KCT, pay directly to us.
 One such notice sent to Transworld.
 MNR then issues writ directly to Angle, claiming she owed money to Transworld for the
pool.
 Angle says she doesn’t owe anything. MNR says: You said you would pay for goods in your
house…give us $. Angle: There is court decision now that says I don’t owe it.
Issue:
 Is this Res Judicata? Does Angle have to pay?
Held:
 No Res Judicata – Angle has to pay!!!
Ratio:
 This is not res judicata, because this is different litigation.
 At common law, there is a way to deal with this: issue estoppel. If an issue was decided in
litigation, cannot raise issue again. The factors required are described by Lord Guest (p.232):
(1) Same question was decided;
(2) Judicial decision which creates estoppel was final; and
(3) Parties to judicial decision were same persons as parties to proceedings in which estoppel is
raised.
 So need same identity of parties and same question.
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 Not dealing with the same question. The question in the first case was whether there was a
taxable benefit – the court which decided that there was a taxable benefit did not necessarily
conclude that there was no debt. That is the question here.
Dissent:
 There is issue estoppel here. The question about whether this was a gift or something that
had to be paid for was decided. Crown is bound by decision that there was no debt.
Town of Grandview v. Doering [1975], pg. 233
Facts:
 A flood damaged the plaintiff’s farm.
 He is suing the town for causing the flood.
 In the first action, he tries to recover damages for flooding caused in 1967-68, alleging that
the dam was faulty and caused flooding and damage. Action is dismissed.
 A few years later, there is more flooding, and Plaintiff brings a new action, for damage
caused from 1969-1972, this time arguing that the dam caused aquifer layer under soil to be
higher which is what caused damage (rather than claiming that the dam caused the flooding).
Issue:
 Is this Res Judicata or issue estoppel?
Held:
 This is issue estoppel.
Ratio:
 Court is extending issue estoppel in 2 ways:
1.
Although different periods of time are covered, it can still be the same question in this
and the previous litigation;
2.
The judgment in the earlier case not only covers the question of whether the dam caused
the flooding but it also covers the related questions that could or should have been raised
in the earlier litigation.
 The whole question of how the water caused damage to the land as a result of the flood has
been dealt with and the court will not re-open it just because of a re-categorization of the issue.
Dissent:
 Whatever happened after 1967-68 was never litigated, therefore, there could be no issue
estoppel.
 Hamilton agrees with dissent.
Bjarnarson v. Manitoba, [1987] p. 238
Facts:
Plaintiff’s brother successfully sued gov’t of Manitoba with respect to flooding of farmland.
Government was negligent with draining system.
Plaintiff owns adjacent land, brings exact same lawsuit.
Gov’t wants to bring defence to the extent that it was not negligent.
No res judicata (different parties). Issue estoppel requires same parties as well. However, it is
clear that facts, issues are identical, that there is a risk of contradictory judgments.
Issue:
151
Does Issue Estoppel apply here irrespective of the fact that different parties exist? Can the gov’t
argue that it was not negligence (i.e. use the same argument it did before)?
Held:
Yes. No.
Ratio:
Extension of issue estoppel/Res Judicata. The Court reviewed Canadian jurisprudence which
held that it must be the same parties for res judicata but he also looked to US and UK
jurisprudence which said that mutuality was not required.
All that is needed is that the loser be the same in each case.
Defendant has already been found negligent once before for the very same conduct that resulted
in the flooding of the Plaintiff’s land. The defendant was a party to the previous action and, while
denying liability, had a full and fair opportunity to examine and cross-examine all the witnesses
on the evidence and to present evidence.
Gov’t of Manitoba had opportunity to raise arguments first time around and didn’t. It is now
estopped from doing so, even though there is a different Plaintiff. This is a reasonable outcome.
Notes:
This reasoning doesn’t work if the defendant wins – if he wins the 1st case, the 2nd plaintiff can
still sue because he might have raised different arguments or hired a better lawyer.
The 1st plaintiff’s loss has no effect on the 2nd plaintiff.
No authority has bound the 2nd plaintiff to the 1st plaintiff’s loss.
Courts tell all potential plaintiffs that they have standing in the 1st case so they can bring whatever
arguments they want to so that only the 1st case will be necessary.
The Court could have made an order in advance, however, that would have bound subsequent
plaintiffs to the outcome even if there was a loss – like a test case.
E. Joinder of Issues
How does one plaintiff raise multiple issues w/the same or a few defendants?
 There are a number of options:
1. Bring separate actions
 Gives rise to issues of expense, expediency, maybe contradictory judgments
2. Joinder of actions
 270 CCP: Even where the claims do not originate from the same source or from related
sources, two or more actions between the same parties, brought before the same jurisdiction,
may be joined by order of the court, if it appears expedient to the court to hear them together
and if it causes no undue delay for any of the actions or serious injury to any third person
interested in any of the actions.
 If you have 2 issues w/2 different defendants, 271 CCP provides that the court may order that
several actions brought before it may be joined even though there are different parties and issues.
Ex: The SH’s sue Enron, the directors and the auditors. They are all separate actions but it makes
sense to hear them together.
 In ON, r.6.01 provides that when 2 or more proceedings are pending before the court with a
common question of law or fact, or any other commonality, the court can order that they be heard
together. This is very broad. This can include different parties.
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3. Joinder of causes of action
QUEBEC
 Can be brought in single proceeding
 66 CCP: Several causes may be joined provided:
(1) that the recourses exercised are not incompatible or contradictory,
(2) that they seek condemnations of a like nature,
(3) that their joinder is not expressly prohibited and
(4) that they are susceptible of the same mode of trial.
 168(4) CCP: Defendant is entitled to ask that case be suspended where he has the right to
demand that Plaintiff declare his option between different recourses that he has joined, or that coplaintiffs disjoin separate actions which they have joined.
o If they should not have been joined, can make motion that they be separated.
 Hamilton: You can use art. 66 CCP to join cases involving >1 plaintiff, >1 defendant, and >1
issue.
 So, you can take them as separate actions, and combine them at trial under 271, 273 or under
66 - combine several causes in same suit (even if against different defendants).
Les Placements Esplanade v. Legare [1976], pg. 241
Facts:
 Plaintiff, the S/H of a company in difficulty suing 9 different defendants.
 5 were directors of company. Allegation was that they declared dividend when company was
insolvent.
 The other 4 were auditors, allegations of professional negligence.
Issue:
 Should the actions be separated?
Held:
 No.
Ratio:
 The court held that the only limitations on the plaintiff’s right to have a joint cause of action
are in art. 66.
 All of the conditions from art. 66 were met.
 Moreover, it is in the interest of justice for these to be heard together.
 They also crapped on the decision to bring this motion at the ending stages of the
proceedings.
MUC v. Reggio Foods [1975], pg. 242
Facts:
 Plaintiff in single proceeding asked for mandamus and damages. Mandamus was to order
MUC to deliver permit, and damages for not issuing permit first time.
Held:
 Court said art. 66 doesn’t work here, because mandamus is proceeding by means of motion,
and damages by means of an action (i.e., not susceptible of same mode of trial).
New Asia v. 2756-7916 [1994], pg. 243
153
Facts:
 The plaintiff alleged that the act in question was both a breach of contract and an extracontractual fault.
 Under 1458 CCQ, there is the rule against cumul – you sue under the contract if it exists.
 In art. 66, recourses exercised must not be incompatible or contradictory.
Held:
 Can’t sue someone for same act alleging that it is both contractual fault and delictual fault.
 1458 renders a contractual recourse and extracontractual recourse incompatible.
 Therefore 66 prohibits their joinder.
Notes:
 What you should do instead is ask for subsidiary conclusions – ex: if this isn’t a breach of
contract, it’s a delict.
 It is also not a problem to sue for some delicts and some contractual breaches at the same
time if they relate to different events (Boss beats you up and fires you – assault and wrongful
termination of employment contract).
 It is also possible to sue 2 defendants based on the same act, one in contract and one in delict
(sue the corporation for breach and sue the directors for delict).
ONTARIO
 In ON, the rule on joinder of issues is found in R.5.
 The structure of rule 5 is to set up a broad principle on joinder and to set up discretionary
relief against joinder.
 General Rule – anything can be joined and no connection is necessary: Rule 5.01(1): A
plaintiff may in same proceeding join any claims the plaintiff or applicant has against an opposite
party.
o Can claim K’al recourse, tort, failure to carry out fiduciary duties, etc. in single action.
 Rule 5.01(2): A plaintiff or applicant may sue in different capacities and a defendant or
respondent may be sued in different capacities in the same proceeding. (ex: personally and as
tutor).
 Rule 5.01(3): Where there is more than one defendant or respondent, it is not necessary for
each to have an interest in all the relief claimed or in each claim included in the proceeding.
 Rule 5.02: Joinder of parties.
 Rule 5.02(2): Multiple defendants: This ties into joinder of issues because what often happens
is that the plaintiff has different issues w/r/t two defendants and wants to sue them together. Ex: I
want to sue the company, the auditors and the directors. The claims arise out of the same facts
but the claims are separate. The rule is that two or more persons may be joined as defendants or
respondents where:
(a) there are asserted against them, whether jointly, severally or in the alternative, any claims to
relief arising out of the same transaction or occurrence, or series of transactions or
occurrences;
(b) a common question of law or fact may arise in the proceeding;
(c) there is doubt as to the person or persons from whom the plaintiff or applicant is entitled
to relief;
(d) damage or loss has been caused to the same plaintiff or applicant by more than one
person, whether or not there is any factual connection between the several claims apart from
the involvement of the plaintiff or applicant, and there is doubt as to the person or persons from
whom the plaintiff or applicant is entitled to relief or the respective amounts from which each
may be liable; or
154
(e) it appears that their being joined in the same proceeding may promote the convenient
administration of justice.
 Both provisions (5.01(1) and 5.02(2)) are very broad in terms of joinder.
 The plaintiff doesn’t have to ask for permission to join claims. This is a question of drafting
the action. If the defendant thinks that the plaintiffs drafting is not appropriate, the defendant’s
remedy is in R.5.05. The remedies include separate proceedings and hearings and so forth.
 There is a control in R. 5.05: Where it appears that joinder of claims or parties may unduly
complicate or delay the hearing or cause undue prejudice to a party, the court may,
(a) order separate hearings;
(b) require one or more of the claims to be asserted, if at all, in another proceeding;
(c) order that a party be compensated by costs for having to attend, or be relieved from attending,
any part of a hearing in which the party has no interest;
(d) stay the proceeding against a defendant or respondent…;
(e) make such other order as is just.
Bath v. Birnstihl [1975], pg. 246
Facts:
 Two groups of vacationers sued because they were dissatisfied with the package that they got.
 They sued the 2 travel wholesalers that packaged and promoted the tours and the 21 retail
travel agents that actually sold the trips in a single proceeding.
 5.02: Claims arise out of same transaction or occurrence. This is fine here, so only issue is
5.05.
 One of the defendants made a motion under rule 5.05 and said that it was too cumbersome to
have 23 defendants.
Held:
 The court held that the claims of the various plaintiffs arose from the same series of
transactions and occurrences and they raised the same questions of law and fact. The claims
against the wholesalers were identical and they were similar to the claims against the retailers.
The court concluded that it would be appropriate to continue this as a single trial.
Clough v. Greyhound [1979], pg. 247
Facts:
 Plaintiff is fired by employer and sues employer for unjust dismissal (breach of contract) and
3rd party for wrongfully inducing breach of contract (tort).
Held: The Court concluded that they can be joint defendants because there was a sufficient
relationship between the claims even though one was a contract and the other was a tort.
Notes:
 Again, think about cost, efficiency, contradictory judgments. This would all be affected if
relief were granted under 5.05.
Thames Steel v. Portman [1980], pg. 248
Facts:
 Plaintiff acquired business from Defendant.
 Plaintiff subsequently sues Defendant with respect to non-compete clause.
 Defence is that non-compete clause doesn’t apply because of release.
 Plaintiff then decides he wants to sue lawyers because they screwed up in drafting the
contract w/o a good non-competition clause and as a result, they have to go to trial.
Held:
 The court analyzed the facts and the rule and set out a test (250-1) to deal with the issue.
155
 The court held that the claims against the vendors and lawyers arose out of the same
contractual documents. Where the central issue in the litigation is the drafting of the contracts, it
is not oppressive or unjust that the lawyers who drafted the contracts be a part of the proceedings.
 The lawyers said why not wait and see if the clause is valid before allowing the purchaser to
sue them. The court said that the way the proceeding is drafted, the purchaser intends to sue the
lawyers whether the competition clause is valid or not. Because you are being sued regardless of
the outcome, you may as well be a party from the beginning.
 This was a good case for joinder.
 So joinder is quite broad. But there is a point where court will say that’s enough.
 Generally, Plaintiff selects issues he wants raised in action. So parties who were added as
defendants are the ones complaining.
 Defendants are concerned with making things complicated and delaying trials.
 We haven’t looked at cases where added defendants were not involved with principal issues.
X. The Exchange of Pleadings
A. Alternative Proceedings
Pleadings: Formal written allegations of parties setting out their respective claims and defences.
The Function of Pleadings:
1. To define the issues with clarity and precision (can see where the parties disagree).
2. Give the other party notice of what you are going to try to prove at trial. If new
evidence of claims are made, they must be added by amending the declaration or
statement of claim.
3. To assist the court - judge reads them before the court giving him/her an idea of
what case is about.
ONTARIO
Action
Ordinary
Simplified
Case Mgt
Small claims
Rules
Application
Statute
 In ON: Under rule 14.02, every proceeding in the court shall be by action except for where a
statute or the rules provide otherwise. This means that the body of rules about how an action
proceeds will apply except in some limited circumstances.
 Alternatively, there is the application. Rule 14.05 provides that a proceeding may be
commenced by an application to a SC of Justice where a statute or the rules allow it.
 Distinction between action and application: Action is the full procedure – exchange of
pleadings, discovery, trial and so forth. The application is a streamlined procedure designed for
the case where you don’t have as many factual issues. You don’t need the full fact-finding
mechanism that the action provides for and it makes more sense to get to court faster.
Applications
 The procedure is described in Rule 38.
 Rule 14.05(3) lists circumstances brought by way of application:
(a,b,c) Successions.
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(d) Interpretation of deed, K.
(f) Change in trust.
(g) Injunction.
(g.1) Remedies under the Charter.
(h) In respect of any matter where there will be no material facts in dispute.
 Applications proceed in a faster manner than do actions because less time is devoted to
factual issue. It deals with legal, not factual issues. So normally, if the facts are not under dispute,
you proceed by way of application. Instead of calling witnesses and making motions on
discovery, you get witnesses to sign written affidavits.
 Rule 38.10 says that on the hearing of an application, the presiding judge may grant the relief
sought or deny it or order that the application proceed to trial.
 38.10 (2): The judge has the power to transform the application into an action if an
application is not appropriate.
Re Danson and A.G. Ontario [1990] p. 252
Charter challenge that proceeded by way of application. Court therefore didn’t have much of a
factual background, but needed it.
There were real factual disputes so they moved them to an action 14.05(3)(h)
Note:
This was pre- r. 14.05(3)(g.1) which was a response to Danson and says remedies under the
Charter are meant to proceed by way of application.
Actions
1. The rules about how an ordinary action is done are in 14-36.
2. Small Claims Court: Where the amount in issue is less than $10 000, the plaintiff can sue
their with the applicable special rules which are designed to quicken things. S. 25 CJA: hear
in a summary way questions of law and fact. No discovery, no witnesses out of court.
3. In March 1996, Ontario introduced simplified procedures. Set out in R. 76.02(1): Procedure
shall be used in action if the plaintiff’s claim is exclusively for money, real property or
personal property and if the value of what is claimed is $50 000 or less. This procedure is
optional in any other case. Plaintiff can choose to use simplified procedure. Then up to
Defendant to object. If > $50 000, court will respect decision to proceed by ordinary
procedure.
o The simplified procedure is an attempt to step away from one size fits all civil
procedure. You can save time and money by eliminating certain procedural
safeguards. They’ve eliminated examination for discovery.
o On the upside, it saves time but on the downside, there can be surprises at trial.
o They’ve also created a “summary trial”. Normally, after discovery, you go to trial.
The plaintiff calls witnesses, the defendant crosses, the plaintiff re-examines and then
the defence goes forward. Under the summary trial, instead of the plaintiff calling
witnesses and asking questions in front of the judge (which is often a rehearsed
sham), the plaintiff will simply file affidavits where the witnesses explain what
happens. The defendant then has a chance to cross examine the witness on his
statement. Trial time is cut by eliminating examination in chief.
o Also, the simplified procedure has tight delays: The case has to be ready for trial
w/in 90 days of the filing of the statement of defence. The rules also provide for a
mandatory pre-trial conference. This is useful for highlighting what the issues are
and pushing the parties to settle. There is also a rule that judgment must be rendered
within 150 days of the statement of defence.
157
4. For balance left under ordinary procedure, Ontario introduced case management (R. 77).
Rule 77.02: The purpose of this Rule is to establish a case management system throughout
Ontario that reduces unnecessary cost and delay in civil litigation, facilitates early and
fair settlements and brings proceedings expeditiously to a just determination while
allowing sufficient time for the conduct of the proceeding. The scope for case management is
in 77.01 – TOR and OTT and 77.01(2) says that there are a number of cases that this system
does not apply to (family cases, commercial list cases, and other listed ones). Under this
system, the parties negotiate their own timetable for their case and if they cannot agree, the
assigned case-management judge imposes one. There are limits to what the parties can do
with the timetable. The plaintiffs will define at the outset whether the case will proceed on
the fast or standard track. On the fast track, there must be a settlement conference w/in 150
days of the defence (240 days on the standard track).
QUEBEC
 Now, all cases proceed by way of motions under CCP 110 – actions and applications are
introduced by means of motions. However, actions and applications pertaining to contempt of
court, habeas corpus, non-contentious matters and the recovery of small claims are governed y
their own special rules.
 There is essentially a single body of rules in 110-481 CCP.
 In this new body of rules, QC has adopted an equivalent of the ON case management system.
 In QC, you proceed with a motion which has an initial presentation date. In between the date
of the service of the motion and the initial presentation date, the parties must meet to agree to a
schedule. If they agree, the schedule is agreed upon it is binding. The schedule must result in the
case being ready for trial w/in 180 days of the date of the service of the motion. If they can’t
agree on a schedule, the judge imposes one.
Exchange of pleadings
 The pleadings are the written documents in which the parties set out their positions: Written
documents in which parties make formal allegations. One plaintiff suing one defendant.
 In ON: the simplest case, the plaintiff will provide a statement of claim, the defendant will
provide a statement of defence and the plaintiff will reply.
 In QC: the plaintiff starts with a motion to institute proceedings – this is a document in which
the plaintiff sets out the factual allegations and the remedies sought. The defendant’s response is
the defence. One of the changes introduced in Jan 1 2003 is the notion that the defendant’s
defence must sometimes be oral. They don’t file a motion but they have to go to court on the
initial presentation date and announces what their defence will be. The plaintiff’s response to the
defence is called answer.
1 pf / 1 df [P v. D]:
Pf serves document on df, setting out his position
Df responds and sets out position in a defence
Pf responds to the defence
Quebec
Motion to Institute Proceedings
Defence
Answer
Ontario
Statement of Claim
Statement of Defence
Reply
 The basic exchange of proceedings can be complicated in 3 different ways:
1. A vs. B: A serves a motion to institute proceedings against B. If B has not only a defence
but a claim against B (cross-demand – 172 CCP or counter-claim – r.27).
158
2. A vs. B: In addition to having a defence on the merits, the defendant might wish to pursue a
claim against a 3rd party, C (recourse in warranty – arts. 216 ff., 3rd party claim – r.29).
3. A vs. B and C: B has a defence and also wants to sue C, a co-defendant. This is a recourse
in warranty in QC(216 ff.) and a cross claim in ON, r.28.
B. Motion to Institute Proceedings or Statement of Claim
ONTARIO
 R. 14.03(1): Originating process for commencement of action is statement of claim.
 One exception: 14.03(2): Where there is insufficient time to prepare statement of claim, an
action may be commenced by notice of action, which contains short statement of nature of claim.
 R. 14.03(3): where a notice of action is used, the pf shall file a statement of claim within 30dayys after the notice of action is issued.
 Form of statement of claim - see handout:
 The 1st two pages of the statement of claim are a pre-printed form that must go to any
defendant. You fill in the names of the parties and the district. It says what the action is and
what steps the defendant must take to defend the actions (20, 40,60 days to file a defence if
served in ON, CAN, Elsewhere). It says that a failure to respond can lead to a default judgment.
 The statement of claim must set out the remedy sought and the facts. In the first paragraph,
you state what you are claiming (remedies sought) and in the 2nd paragraph, you state the facts
that you are relying on. Rule 25.06 are the rules of pleadings. Rule 25.06(1): the pleadings must
state the facts and not the evidence (note difference b/w facts and evidence – fact = you crossed
on a red light; evidence = I have a witness that saw you. You don’t state evidence here, just the
facts. The purpose of the trial is to prove your factual allegations). R.25.06(9): Where a pleading
claims relief, the relief must be specified and the amount of damages claimed must be specified to
the extent that it is known.
Allan v. New Mount Sinai Hospital [1981] p. 261
The defendant argued that the statement of Claim was deficient because it was a claim for battery
but it didn’t mention the word battery. The Court held that it didn’t matter that the legal term
wasn’t used. You just need to mention the facts to back up what you want. You don’t have to
allege the elements that are sufficient to lead to the conclusion. Your statement of claim should
be like a checklist of what you need to prove at trial to get the remedy sought.
Procedure
1. Draft statement of claim (see above)
2. Have the statement of claim issued by the court (issuance).
3. Serve the action
 Once the statement of claim is drafted, the next step is to get it issued by the court. Issuance
of statement of claim is done by registrar who dates, signs and seals, and assigns a number
(14.07). Copy is left in court file.
 For service, statement of claim must be served within 6 months of it having been issued
(14.08). Although R. 3.02 allows extensions.
 Delays to contest start to run from moment of service.
Paupst v. Henry [1983] p. 261,
159
Proceedings were never served on one of the defendants and court held that if it was never
served, the defendant hadn’t been sued.
 Rule 16: ON rules on Service. The best form of service is personal service (16.02). Rule
16.03 discusses the alternatives to personal service. As a further fallback, there is the possibility
of substituted service in rule 16.04. The hierarchy is described in rule 16.01.
 R. 16.02 sets out the rules on personal service, which is the preferred form. Sets out how to
effect personal service for each type of defendant:
o For individual, R. 16.02(1)(a): By leaving a copy of the document with the individual.
o For corporation, R. 16.02(1)(c): By leaving a copy of the document with an officer,
director or agent of the corporation, or with a person at any place of business of the
corporation who appears to be in control or management of the place of business.
 R. 16.03: Additional forms of service. Alternatives are available in all cases except divorce.
1. 16.03(2): Acceptance by solicitor. The solicitor must be authorized to accept it.
2. 16.03(4): By mail to last known address. The service is only effective when the
defendant sends back the confirmation of receipt.
3. 16.03(5): Service at place of residence (leaving a copy, in a sealed envelope
addressed to the person, at the residence with anyone who appears to be an adult
member of the household). Also have to mail a copy to person at place of residence.
Service is effective on 5th day after document is mailed.
4. 16.03(6): Where you are serving on a corporation that has given an address of service
in its constating documents, you can serve by mailing to that address.
 16.04: Where it appears to the court that it would be impractical to serve personally or with
an alterative, the court can authorize something else. The court’s discretion is very broad. They
can use service in the newspaper, service on a relative. Substituted service is not great because
the defendant can usually shit on a default judgment when he finally appears out of the
woodwork. It is in the plaintiff’s interest to ask for a substituted service that is likely to bring the
service to the defendant’s attention.
Canadian Dominion v. Corpex [1969] p. 263
Facts:
Action against corporation.
Process server trying to serve president of company. Sees president go into apartment. Knocks
on door. Daughter answers and says father not home. Leaves document in door. Sees father
take document and throw it at him. Process server puts it back.
President called his lawyer, lawyer said ignore it.
Issue:
Service?
Held:
Yes – valid service.
 Rules on drafting, issuance, and service apply same way under simplified procedure or for
case management, with following exceptions:
o Under simplified procedures, statement of claim must indicate that you’re using
simplified procedure (R.76).
o Under case management, document called notice of commencement of proceedings
must be completed. This is what is filed into court record. In notice, P indicates
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whether proceeding is under fast track or standard track (R. 77.06(5)). This refers to
how quickly this case is expected to get to trial. P must consider factors in 77.06(6)
(pg. 300). D can challenge.
QUEBEC
 CCP 110: actions and applications are introduced by means of motions.
 CCP 111: a motion to institute proceedings is a concise written statement of the facts on
which the action or application is based and the conclusions sought (note, order different than
Ontario). The motion is prepared and signed by the plaintiff or attorney of plaintiff.
 CCP 111.1: the motion to institute proceedings indicates the court seized of the action or
application and the district (unlike Ont.) in which it is brought and states the name, domicile and
place of residence of the plaintiff and the name and last known place of residence of the
defendant. It also indicates in what capacity a party is named in the motion if not in the party’s
personal capacity.
JLD v. Vallée [1996] p. 256
Plaintiff who wished to remain anonymous made a motion to court to use only initials and to
give his lawyer’s office instead of home address. Permission was granted. But general rule is
that must sue in your own name.
 Art. 118 CCP: If object of demand is property, must include description of property (lot
number and so forth).
 Art. 76 ff CCP: general rules on drafting. 76: Must indicate facts you intend to prove and the
conclusions you seek.
 There is significant difference between fact and evidence. E.g., for bike accident, would say
defendant was riding in reckless manner, etc. (factual allegations). This is what you intend to
prove. Not appropriate to say in declaration that Mrs. S. saw D riding recklessly. Don’t have to
say how you will prove it.
 Art. 76(2) CCP: Must be frank, precise, brief. Shall be divided into paras., each numbered
and referring to one essential fact.
 Art. 77 CCP: Every fact of such a nature as to take opposite party by surprise if not alleged,
or to raise an issue not arising from the pleadings already filed, must be expressly pleaded. This
has to do with situation where Defendant has made an extra-judicial admission, and you intend it
to use as evidence, must include it in declaration.
 After the factual allegations, you have to state the conclusions sought.
 Test that declaration must pass is art. 165(4) CCP: Defendant may ask for dismissal of action
if it is unfounded in law, even if facts alleged are true. Must allege sufficient facts that if you are
able to prove them, will be entitled to conclusion for which you are asking. Otherwise, no point
in going ahead with lawsuit.
 CCP 119: the motion to institute proceedings must be accompanied by a notice to the
defendant to appear within the time limit indicated in order to file an answer to the action
or application. The time limit is 10-days from service of the notice, except where otherwise
prescribed (2nd to last page of example).
 The second step (112 CCP) is to have the motion issued. You have to pay for the court’s
stamp (minimum $53 depending on amount at issue and whether person or corporation) and give
it to a clerk. The clerk will issue the document by giving it a number, signing and sealing it and
keeping a copy.
161
 The Court number: the 1st 3 digits are the judicial district (500=montreal), the next 2 numbers
refer to the court (09 = CA), the next 6 digits are issued sequentially and the last 3 digits are the
year and a randomly assigned number.
 After the motion is issued, it must be served. The defence’s delays only run once the motion
is served. The plaintiff has no limit on when he can serve. The problem that you run into in QC
is prescription. In principle, a motion must be issued and served w/in the prescription period in
order for it to be validly instituted.
 2892 CCQ: Prescription is in 3 years but if you issue your motion w/in the prescription
period, the clock is interrupted so long as you serve w/in 60 days of the end of the period.
 Note that unlike in Ontario, you do not need to serve w/in a particular time frame after issue
(you can sit on it).
 CCP 143: the judge or clerk may order the plaintiff who delays having a motion to
institute proceedings served to do so within the time fixed under pain of annulment of the
motion to institute proceedings.
 A defendant may want to be served because his name stays on record until this is dealt with.
 Service is done by bailiff (court officer).
 If you are dealing with individual, basic rule is personal service - CCP 123(2): personal
service may be made by handing a copy of the proceeding to him in person, domiciliary service
may be made by leaving the copy at his domicile or residence, with a reasonable person
residing therein (not an adult like Ont.).
 Alternatives are domiciliary service: 123(2): Leave copy at residence with reasonable person
residing therein.
 123(3): Service may also be made at the domicile elected by the person for whom it is
intended, or upon the person indicated by him (e.g., lawyer’s office).
 123(4): If he has no known domicile or ordinary residence within Quebec, service may be
made by leaving a copy of the proceeding in a sealed envelope addressed to the person for whom
it is intended at the person’s business establishment or place of work, speaking to a
reasonable person in charge thereof.
 130: For legal person, 2 alternatives:
(1) Service at head office, on of its establishments in QC or at the establishment of
an agent in the district where the cause of action arose. Service occurs by giving
the proceeding to a senior officer or to the person that appears to be in charge of
the establishment.
(2) Senior officer, wherever you find that person (if the above doesn’t apply).
Saratoga Construction v. Grenache [1979] p. 258:
Facts:
Plaintiff has taken action versus Saratoga. Service was made at the head office - bailiff left it
with receptionist. Following service of the proceeding, Saratoga did not reply. Judgement
rendered by default. When seizing property, construction made a motion to set aside judgement
because the action had not properly been served.
The receptionist threw out the proceeding so nobody in authority knew about it.
Held:
Invalid service as the receptionist was not ‘really’ the one in charge of the office.
Strictly speaking, this is obviously not a valid service to start with. The Court could have said no
service – no judgment.
162
The court was interested in discussing whether it was necessary to have knowledge on top of
service. The court seemed to say that valid service might not be necessary if the defendant
actually had knowledge of the suit. If the receptionist had given the senior officer the motion, the
default judgment would have probably stood up even though the service was no good.
 Substituted Service (139-140): 139 allows service by public notice (p.260). 140 allows for
service by mail. Other service not explicitly mentioned include leaving it in the mailbox if the
defendant refuses to accept service.
 Note that all documents can be exchanged between attorneys. From the moment that a
lawyer gets involved for the defendant, you can serve all future documents on him. Art. 140.1
allows for service to a lawyer by fax.
C. Appearance or Notice of Intention to Defend
 Once the initial document has been served on the defendant, he must respond.
 In QC, the defendant’s first step is the appearance and in ON it is the notice of intent to
defend.
QUEBEC
 The appearance is a document that says we hereby appear on behalf of the defendant which is
signed by the defendant’s law firm. If the defendant represents himself, that’s what his
appearance will say.
 The appearance is an acknowledgement of service. The filing of an appearance destroys any
defects in service.
 If the appearance is filed by a law firm, it announces that it has the defendant’s mandate and
the plaintiff now knows that they are dealing with the attorneys. All future communication will
be with the defence attorneys rather than the defendant himself.
 Appearance: arts. 149-51 CCP.
 Art. 149 CCP: Defendant must appear before the expiry of the time fixed, by filing in the
office of the court a written appearance signed by him or his attorney.
 The delay is in 119 CCP – 10 days from service of motion.
 Art. 150: If the defendant fails to appear w/in 10 days, as of the 11th day, the plaintiff is
entitled to note the default and start proceedings for a default judgment. The defendant can
appear after 10 days. If the plaintiff hasn’t started the default process, it doesn’t matter. If the
plaintiff has started the default proceeding, the defendant will either need the plaintiff’s consent
or a court order (151 CCP). Typically, plaintiffs are expected not to contest requests for
permission to file a late appearance.
ONTARIO
 They’ve eliminated the appearance in order to simplify.
 To proceed in ON, you simply file your defence (see 2nd para of ON statement of claim).
 There is a step that is akin to the appearance. You can file a notice of intention to defend
under r.18.02(2). It says that within the delay for filing a defence (20 days – ON, 40 days – CAN,
60 days – World), you can file a notice of intent to defend if you are not able to file the actual
defence. It is a 1 sentence document like the appearance. It’s effect is to add 10 days to the delay
to file a defence. It is the same under case management or the simple procedure.
 Fulfills similar role as appearance: indicates intention to defend, provides name of lawyer.
 For simplified procedure and case management, same rules.
163
D. Defence or Statement of Defence
 In ON and QC, this step is very similar with one exception.
 This document has 2 parts: the 1st part is a paragraph by paragraph response to the statement
of claim. The defendant has 3 options per paragraph – admit the allegation (ex: the defendant
will admit para. 2 of the ON statement of claim), deny the allegation (the affect of denying an
allegation is that the plaintiff will have to prove the allegation at trial) or the defendant can claim
they have no knowledge of the allegation (Ignorer en francais). When you claim no knowledge,
the effect is similar to a denial.
 In QC, you discuss each para individually. In ON, you have 3 paragraphs where you group
together the admits, denies and the no-knowledges.
 The 2nd part of the statement of defence is where the defendant adds additional facts which
will form the defendant’s defence. Ex: If the statement of claim is about goods delivered and not
paid for (see QC motion), the defendants will either say that the goods weren’t delivered or that
they were defective in some way. You could admit all of the plaintiff’s facts and still have a
defence if you add in the defect.
QUEBEC
 As a part of the CCP overhaul, they played around w/the defence.
 Under 172 CCP, the defence is defined: Defendant may plead by defence any ground of law
or fact which shows that the conclusions sought cannot be granted in whole or in part.
 175.1 introduced a notion that there are 2 types of defence. In some cases, you file a written
defence as above but in other cases, a defence is provided orally. The general rule is written
defence and the circumstances where an oral defence is required are set out in 175.2 (see esp. 4,
6, 7).
 175.2(4) relates to obligations – you must file an oral defence where the claim is related to
essentially simple contractual claims (the idea is that we don’t need to impose additional time or
delays for such simple cases).
 175.2(6) deals with PIL – it says that you do an oral defence when you are dealing with the
enforcement and recognition of foreign judgments or foreign arbitration awards.
 175.2(7): talks about certain procedural remedies (declaratory judgments, extraordinary
recourses), applications for which are defended orally.
 175.3 says that where a written defence is required, the parties can agree or the court can
order an oral defence and that the parties can agree to have a written defence where 175.2
mandates an oral defence.
 Hamilton doesn’t like the idea of oral defences.
 What happens is that at the initial presentation date (151.4 – set by the plaintif at least 30 days
after service), under 151.5, the defendant must set out the grounds of the defence.
 Rule 75 of the SC rules of practice says that the grounds of defence must be summarized in
the minutes of the hearing.
 Hamilton says that having an oral defence complicates things. The purpose of the pleadings
is to help the judge figure out what the issues are – objections based on relevance are based on the
allegations of the parties. We need to have the grounds in writing in front of the parties at all
times. What happens if the defendant wants to do a cross-demand – should it be oral?
 When you get to the presentation date, if it is an oral defence – there are 2 possibilities:
o 151.6 (1): If the parties are ready to proceed at the initial presentation date, the court may
hear the merits of the case immediately or decide on the date of the hearing.
164
If the parties are not ready to proceed immediately or if the judge doesn’t have the time to
hear the parties, the court will set a date.
 If it will be a written defence, at the initial presentation date, the judge sets a timetable to
ensure the orderly procedure of the hearing (151.6(4)).
 151.1: Before the presentation date, the parties are supposed to negotiate a timetable for the
proceeding. If they agree, they just have to file their timetable and procedures in court on initial
presentation date. They can set up whatever they want in terms of oral, written defences, dates of
appearances, dates of motions.
 The limitations on what the parties can agree to are in 110.1 – the case must be ready for
trial within 180 days of service of the motion to institute proceedings – the plaintiff must file
an inscription stating that the case is ready for trial. If the case hasn’t been inscribed w/in 180
days, the case will be dismissed by the courts. The plaintiff will have to start over unless there is
a prescription issue. 110.1 further says that the court can extend the time limit in the last month
before expiry of the 180 days if the case warrants it due to its complexity.
 Lawyers really didn’t like this provision because many lawyers know which cases won’t be
ready in 6 months on the 1st day and it is stupid to force the parties through the 1st 5 months with
an unreasonable target. The parties can’t even treat it as something to bargain around because it
is ultimately the court’s decision as to whether to extend the deadline. The minister of justice has
filed an amendment that allows you to ask for an extension at any time – it hasn’t been passed
yet.
 If the parties don’t agree on a timetable and presentation date comes, go to court.
CCP 151.4: here present preliminary exceptions orally (i.e. jurisdiction, motion for
particulars…)
CCP 151.6: what a court may do:
1) if defence is to be oral and parties are ready, hear the merits of the case,
or otherwise determine the date of the hearing.
2) hear contested preliminary exceptions, or defer the hearing of exceptions
to another date.
4) in absence of timetable, determine a timetable that ensures orderly progress
of the proceedings (note must respect 180 day time limit). Note this option
not available if the defence is oral.
o
Xerox v. Boily: The judge held that the plaintiff was a consumer which meant that the plaintiff’s
action would get thrown out. The defendant hadn’t raised it. The CA said that the judge is not
allowed to do this. This shows the problem of oral defences. If there was an oral defence in this
case, you have to study the summary of the hearing at the presentation. This summary, however,
is not in the defendant’s words.
 In QC, the plaintiff can respond to the allegations in the defence by filing an “answer”.
 The plaintiff used to be able to file an answer in any cases. Art. 182 says that an answer can
only be filed pursuant to the agreed upon timetable. If it is not in the timetable, the plaintiff
cannot file an answer.
 Once the answer is filed or if there is no answer, you have joinder of issues (186). This
means that the issues are set.
 There are discoveries which follow (out of court examinations of various witnesses). These
help to make the parties understand all of the facts of the dispute and narrows the debate. This is
to lead to a settlement or to simplifying the trial.
 Discovery takes place throughout the process between the motion to institute proceedings and
the defence. 398 CCP allows the defence to examine before filing the defence. After the defence
165
is filed, both parties have a right to examine. Usually, the timetable will make time for the
discoveries, before and after defence – all of which occurs before answer and joinder.
 Once the joinder of issues and discoveries are completed, the case is ready to be inscribed
(274 ff.)
 274: After joinder of issues, the case is ready to be inscribed. If it is an oral defence, there is
no inscription – the judge sets the date at the presentation.
 274.1: the inscription form is accompanied by a bunch of documents which helps the court
figure out how long the case will take and helps the parties figure out what the other is up to.
 After one party has inscribed the action, the other party has 30 days to file their declarations
(274.2).
 Once all the declarations have been filed, the parties will be called to the court for a
scheduling hearing. The judge will try to shorten the time.
ONTARIO
 ON: 20-40-60, see above – r.18.01. The possibility to add 10 days exists if you file a notice
of intent to defend. If the defendant misses the delay, under r.19, he can have the defendant noted
in default and commence default proceedings. If the plaintiff files default proceedings and the
DF shows up, he needs consent or a court order to defend. If no default procedure has started, no
harm no foul.
 In principle, preliminary matters do not extend delay.
 Discovery doesn’t start until after defence starts.
 Simplified procedure and case management rules do not affect this.
 After statement of defence, Plaintiff has right to file reply within 10 days after service of
statement of defence (R. 25.04(3)) after which the exchange of pleadings is completed.
 After that, R. 25.05: Pleadings are closed. Exchange of pleadings is completed. This event
triggers beginning of discovery.
 After the discoveries and introductory motions, the parties should be ready for trial.
 After those matters are completed, parties are ready for trial. Set action down for trial under
R. 48. Then case goes on list. They will be called by court, court calls lawyers in to discuss trial
date.
 Under simplified procedure (R. 76), some differences (the simplifications of procedure occur
here):
o First, no discovery (R. 76.04) – saves time and money but increases the
possibility of surprises at trial.
o Secondly, there are time limits. Once statement of defence is filed, Plaintiff has
90 days to file notice of readiness for pretrial conference (R. 76.09). At pretrial
conference, judge will try to get parties to settle. If he is unsuccessful, will set
trial date.
o R.76.12 – summary trial: witnesses testify through statements and those are
exchanged in advance of the trial. This lessens the blow of the lack of discovery.
 Under case management (R. 77), once statement of defence is filed, case management judge
will be assigned to case. His job is to accelerate mattes and get the parties to trial as quickly as
possible. The judge can set limits on discovery (number of witnesses or duration). The
advantage of having a case management judge is that he becomes familiar with the case. You can
do all of your initial motions to him and he will be familiar with the case so it will go faster.
 Also added under case management is mandatory settlement conference (R. 77.14). Try to
get parties to settle. Where case is on fast track, must have conference within 150 days from
filing of statement of defence. If judge cannot convince parties to settle, judge sets trial date.
Under slow track, have 240 days. Although case management judge can play around with this.
166
E. Cross-Demand or Counter-Claim
 Cross-demand (QC)/Counter Claim (ON): a claim by the defendant against the plaintiff.
 Where the defendant has a claim against the plaintiff, he has 2 options:
o Bring a new separate action against the plaintiff. If he chooses to do that, it creates a
certain inefficiency. They will be debating in different courts at different times. You can
ask the court to join the trial of the separate proceedings (270 CCP, r.6).
o In the alternative, rather than proceeding in a separate action, the defendant can raise the
separate claim as a part of his defence. The main reason to do that is to delay the
proceeding. A cross-demand delays the case by complicating it. It might also mean that
the parties’ claims are related to the same transaction.
 Cross-demand or Counterclaim forms part of the defence/ statement of defect (no motion to
institute proceedings or statement of claim that is separate for the cross/counter claim). And, the
defence to it is part of the answer/ reply
 172 CCP: The defendant may in the same proceeding constitute himself cross-plaintiff in
order to urge against the plaintiff any claim arising from the same source (this is the only limit) as
the principal demand, or from a related source.
 The test is to what extent the cross-demand is related to the principle action.
 In Gamache, the test used was very narrow – this is the older approach.
 In Foessl, the court used a broader approach which is in vogue now. In Foessl, the test for
relatedness is whether it is in the interests of justice to hear the case at the same time and
whether there is any prejudice to the plaintiff. This is a more practical approach. The factors
that the court looks at in establishing the interests of justice are the fact that the same facts are
raised in both claims (efficiency and danger of contradictory judgments). In terms of prejudice to
the plaintiffs, the court looks at whether the cross-demand is much more complex than the
principle demand.
 In ON, a counterclaim is covered by r. 27. The drafting of the rule shows a legislative bias in
favour of counter claims.
 27.01(01): The defendant can assert any counterclaim. Strong starting point.
 The limitation is in 27.08(2), where it appears that the counterclaim will cause undue delay or
complication or unduly prejudice the plaintiff, the court can order a separate trial or action.
 Bossa: The plaintiff alleged that the defendant defamed him and the defendant said that the
plaintiff defamed him. The court held that notwithstanding the similarity, the two claims raise
completely different issues. In each case, you have to look at what one said about the other.
Each case is the mirror image of the other and they should be done separately.
 Mogil: Complex litigation arising out of 2 separate actions with counterclaims (total of 4
claims). One of the counterclaims was challenged under 27.08. The Court held that where a
defendant is counterclaiming a debt claim with a set-off defence which results in a difference in
the defendant’s favour, this should be done with the initial claim. Set-off just goes one step
further from a claim for a debt.
XI. Interlocutory Matters
A. Procedure and Delays
 In litigation, there are a series of issues that can arise that can be submitted to a judge for
decision prior to a case getting to trial. Egs:
o Jurisdiction: not a defence at trial, raised at preliminary stage.
167
o Capacity: If D does not have capacity to be sued.
o Interest: If P does not have interest.
o Declaration unfounded in law.
o Security for costs.
o Amendments.
o Particulars: details about proceeding.
 Interlocutory: during the lawsuit.
QUEBEC
 In QC, the general rule is that interlocutory matters are raised by means of a motion. Art. 88
CCP says that raising interlocutory matters is done with a motion accompanied by an affidavit
swearing all evidence not before the court. Contestation is oral unless permission is granted for
written contestation.
 The process is this – you file a motion stating what you want – ex: I am the defendant and I
think this court lacks jurisdiction. It must be supported by an affidavit if the facts alleged don’t
appear on the record. Ex: If the plaintiffs don’t specify when the fault occurred, you don’t need
an affidavit to ask the plaintiff to tell you when it occurred. On the other hand, if you contend
that the fault occurred in QC, you need an affidavit.
 The motion can be served on the other parties’ lawyer (art. 78).
 Motion, supported by affidavit, is accompanied by 3rd document: notice of presentation. This
is notice advising other side of date and place when motion will be presented to court.
 The party instituting the motion can have a date selected unilaterally by one party so in those
circumstances, the presentation will be rescheduled.
 In principle, it is argued orally. Art. 88 CCP: Motion can only be contested orally, but can
ask court for permission to file written response.
 Usually, interlocutory motions don’t involve complex factual matters. The other party will
have a right to cross-examine the witness who gave an affidavit if necessary (art. 93). The right
to have witnesses at the hearing is provided for in art. 88.
 With the new system in QC of motions to institute proceedings and presentation dates, a new
structure has been created to handle preliminary exceptions.
 Peliminary exceptions are a category of interlocutory matters – 159 CCP ff.
 There are 3 categories:
1. Declinatory Exceptions (163-4): they are jurisdictional. 163 has to do w/territorial
jurisdiction (QC court has no jurisdiction). 164 is about subject matter jurisdiction
(you’re in SC and should be in CQ).
2. Exceptions to Dismiss (165): There are 4 circumstances in which the defendant can ask
for the action to be dismissed at a preliminary stage:
a. Lis Pendens or Res judicata.
b. One party is incapable (lacks capacity)
c. The plaintiff clearly has no interest in the suit.
d. The suit is unfounded in law even if the facts alleged are true. This is essentially
the defendant’s way of saying so what – if everything you say is true and you
prove all of your allegations, you’re still not entitled to the remedy you are
seeking. As such, there is no need for a trial.
3. Dilatory (means delay) Exceptions: You are asking for a delay on a deadline where
something needs to be done. There are 8 particular ones. The defendant may ask that the
suit be stayed where he needs more information about the allegations against him (para.
7). The defence is asking for time before he has to file a defence while waiting for
particulars.
 Preliminary exceptions get tied in with the idea of service followed by a presentation date.
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 Art. 159 sets out the general proposition that preliminary exceptions and conclusions sought
must be presented to the other party in writing before the presentation date. The defence must
essentially send a letter indicating what preliminary motions they intend to make on the
presentation date and this letter must be sent out prior to the presentation date.
 If the parties are successful in negotiating the timetable (151.1), they will set out the various
motions in the timetable (see p.281) and the dates when they will occur.
 If the parties don’t agree, the defendant must disclose his preliminary exceptions in writing
before the presentation date and they must be raised orally at the presentation date (159).
 Under 151.5, the preliminary exceptions must be raised orally in front of the judge.
 151.6 (2): The Court can choose to hear the exceptions on the spot or to delay it for a later
date.
 The court sets up the timetable as if the declinatory exception will be rejected. If it is
accepted, the timetable is thrown out.
 The parties are able to argue their declinatory exceptions on the spot on the presentation date.
In principle, the judge can hear all of the declinatory exceptions on the spot.
 Delays for presentation of preliminary exceptions in QC used to be very technical and
annoying but that is no longer the case. Now, motions are disclosed before the presentation date.
The parties either agree on a timetable (which will be logically ordered) or a judge will impose
one which will also be logical (ex: jurisdiction will be dealt w/first because if there is no
jurisdiction, there is no nee to hear any other declinatory or dilatory exceptions). Obviously, in
some circumstances, you will need to do a motion for particulars before a declinatory exception
in order to access information for a better motion for declinatory exception. You’d have to
specify that you were not conceding on the court’s jurisdiction.
ONTARIO
 Interlocutory matters are also raised by motion. Documents supporting motion are not
dissimilar to what you have in Quebec. Have notice of motion, which includes notice to other
party, in terms of where and when motion will be presented, tells other party what you are asking
for, and what you will be relying on (R. 37.06).
 Also submit motion record, which gives court materials that it needs to decide motion
(documents, affidavits, transcripts, etc.).
 Also have right to file factum (R. 37.10(6))
 Motions are typically heard by judge. Master will hear certain types of motions (same in
Quebec).
 More civilized in terms of scheduling of notions. In Quebec, party making motion chooses
date. In Ontario, there is practice of doing this by appointment. Ask court what dates are
available, debate with other party.
 Under case management rules, all of interlocutory motions are heard by same judge. This is
advantageous for 2 reasons:
1) Don’t have to spend first 15 minutes explaining to new judge whole background.
2) Judge has sense of how litigation is proceeding. Sometimes, motions are being made
strictly to delay process.
 Judge at settlement conference will point out strong and weak parts of claim. He can do this,
because he will not be judge at trial. But will hear interlocutory matters.
 Don’t have strict rules on delays within which motions are to be brought.
 21.01: Sets out a series of grounds on which motions can be made:
o Determination before trial of a question of law before the proceeding if doing so would
end the trial or save a lot of time or money.
o Strike out a pleading on the grounds that it discloses no reasonable cause of action or
defence (like 165(4) CCP).
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o
21.01(3): particular grounds for defendant: no jurisdiction, no capacity, lis pendens,
action is frivolous or vexatious (similar to 165 CCP).
 Delays: On the question of jurisdiction, a problem is acquiescence. There is a short time
delay before filing a defence (20-40-60 days). If you want to raise a question of jurisdiction, you
must do so before you file the defence. This has the effect of stopping the clock on your delay to
file a defence if you file a preliminary exception based on jurisdiction. The exception is that if
there is an appeal, the CA can tell you to continue your proceedings even if it turns out to be
useless.
 R. 21.02: Shall be made promptly, and a failure may be taken into account by court in
awarding costs.
 Also, there is one particularity: Security for costs motion cannot be made until after you have
filed defence.
B. Security for Costs
QUEBEC
 Typically, this is the 1st motion that is made.
 In Quebec, the right is set out in art. 65 CCP: Plaintiff who does not reside in Quebec must
give security for costs…
 This is simple rule, based on residence. A plaintiff who does not reside in QC must give
security for costs which may be incurred as a result of his suit. A foreigner who wants to sue in
QC must pony up dough in order for the courts to listen to him. The defendant figures out what
the potential costs might be and asks for them.
 Residence is defined in art. 77 CCQ: Residence of person is place where he ordinarily
resides. If he has more than one, his principal residence is considered in establishing his
domicile. This is drafted with a physical person in mind. Not usually hotly contested.
 There is nothing that defines residence of corporation. Courts have held that residence of
corporation is its head office.
 The defendant makes a motion under 152 CCP asking for the costs as he figured them out.
 He makes this motion at the presentation date. If the plaintiff cannot provide security, the
court can dismiss the action.
 The test for this is residential (Balmoral Mines) – the law in QC has been that the location of
the head office determines residence and then, asking for security for costs. This leads to stupid
situations – CIBC, headquartered in ON but w/billions in assets in QC, needs to pay security for
costs. In Dunn v. Whiteman, the court held that the new rule in the CCQ which talks about the
“establishment” of a legal person can be seen as analogous to the residence requirement. This
was overturned by the CA.
 In the 2003 amendments to the CCP, 152 was softened. It says that the court determines the
amount of security based on the nature and complexity of the case (…other factors…) and the
assets held by the plaintiff in QC. This rule makes it possible that CIBC won’t have to pay
security for costs. Most people pay security for costs by placing the amount in a trust account or
getting a letter of credit from the bank. Until recently, this system was particularly stupid.
 152: The court can reduce or increase the security for costs at any time during the
proceedings.
 153: The defendant can ask for security for costs at any time after the presentation date but
may be forced to pay the costs of this kind of hearing.
ONTARIO
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 Security for costs is raised later. R. 56.03: Motion for security may be made only after D has
delivered defence.
 This seems unfair to D, because he is exposed for period up until defence is filed.
 The reason is because in Ontario circumstances in which you are entitled to security are
different than in Quebec.
 56.01(1): SFC is available where the court feels that it would be just (discretionary) and sets
out 6 circumstances in which SFC would be open to the court:
o The plaintiff is normally resident outside of ON. All of the others relate to residents,
against whom SFC can be ordered.
o Lis Pendens (this is intended to be punitive).
o The defendant has an order against the plaintiff in other proceedings that has not been
paid in full.
o The plaintiff is a corporation and there is good reason to believe that it does not have
sufficient assets in ON to pay the costs. Note that in QC, a resident w/insufficient assets
doesn’t need to pay security for costs.
o There is good reason to believe that the action is frivolous and vexatious and the plaintiff
has insufficient assets (for physical persons).
o If a statute entitles the defence to security for costs.
 SFC in ON is discretionary and flexible. If there is reciprocity between ON and the other
jurisdiction, such that it would be easy to enforce an ON judgment there, the court will take that
into consideration in order to determine whether or not to order SFC.
 In terms of amounts, R. 56.04: Amount of security is determined by court. Time for payment
also determined by court, so can reflect more accurately costs incurred to date.
C. Dismissal of Proceedings or Determination of Issues
 There are certain issues that you can ask a court to determine before you get to the trial. Note
that the trial is the culmination of all of the steps of civil procedure. You place witnesses and
exhibits in front of the judge and you cross-examine. Once the judge discovers the facts, he will
apply legal principles to resolve the dispute.
 If there are no factual issues in dispute, you don’t need most of the steps. You can go right to
the legal question.
 Similarly, if there are legal issues that can be decided without going through all of the factual
determination, it might be appropriate to have the specific issue determined in advance as it might
remove the need for the trial or shorten it. Ex: prescription – if the defendant can show that the
plaintiff’s right of action is prescribed, there is no need for a trial.
QUEBEC
 Grounds for dismissal (there are 7):
1. Territorial jurisdiction – 163 CCP,
2. Subject-matter jurisdiction – 164 CCP,
3. Lis pendens/res judicata – 165(1),
4. Lack of capacity – 165(2),
5. Lack of interest 165(3),
6. Suit is unfounded in law even if the facts alleged are true - 165(4),
7. At any stage of proceedings, the court on a motion may dismiss an action or
proceeding if the examination held pursuant to this code shows that the action is
frivolous or groundless for some ground other than 165(4) - 75.1.
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 165(4) and 75.1 are related. 165(4) refers to the proceedings as drafted – even if the plaintiff
proves everything that he intends to prove, he will still not be entitled to the remedy sought as a
matter of law. This is only available if the consequence is the dismissal of the whole lawsuit (it is
not enough to show that one of many conclusions is unfounded). 75.1 is related to this but occurs
at another stage of proceedings – it is brought after examination on discovery. If during the
course of examination on discovery, the defendant questions the plaintiff and gets admissions
about the accuracy of the pleadings or pulls out additional facts, the defendant can move for a
dismissal. This is used when the pleadings lead to the conclusion sought but the pleadings are
BS.
 It is rare for courts to accept motions under 75.1 and 165(4) – courts think plaintiffs are
entitled to their day in court. Judges tend to see these recourses as exceptional and place a high
burden on a defendant to get a claim dismissed.
Valco Metal: The plaintiff sued the bank on which the check was drawn and the bank which
cashed it. The Court concluded that there was no legal theory upon which you can make the bank
that drew on the check liable. Hamilton thinks that this should have been done under 165(4).
The Court dismissed the proceedings.
ONTARIO
 The rules are somewhat broader – there are 2 provisions:
 R-20 on summary judgment – this essentially means judgment w/o going through a full trial.
It is available to either party (Def: you cannot find me liable on this statement of claim – plaintiff:
the statement of defence discloses no valid defence). This is only available after the statement of
defence has been filed and only when there is no genuine issue for trial or that the only genuine
issue is a question of law or the calculation of damages. One party applies for summary judgment
and the other party responds w/an affidavit setting out their position as to what the issues are. If
the court is satisfied that there is no genuine issue, the court will render a summary judgment.
For this to happen, the statement of claim must be crap or the statement of defence must not raise
any issues. If the judge concludes that the only issue is the amount of the judgment, he can either
render a judgment on liability and referring the calculation of damages to a clerk or go to trial and
instruct the trial judge that the only issue is the amount of damages.
 If the only issue is a question of law, there should be a hearing dealing with the legal issue
and legal argument will be made. If the judge concludes that there are other issues that need to be
determined, the judge will dismiss the motion for summary judgment but the process is not
completely wasted as the judge can take certain steps to simplify the trial. He can limit what facts
are really in dispute which will save time.
Vaughn: The plaintiff made figurines that looked like Gremlins. He sued Warner Brothers for
Copyright violations when they released the movie. The defendant asked for a summary
judgment dismissing the action. In the materials supporting the summary judgment, the
defendants showed that they didn’t know the plaintiff or hi figurines and showed how they
created the gremlins. The court looked at the evidence in front of it and found no basis to show
that there was any copying and that no member of the “gremlins” team that could have known of
these figurines. They also concluded that the figurines didn’t even look much like the gremlins.
The plaintiff said he was entitled to his day in court and the court responded that this was his day
in court. If we can avoid subjecting parties to costs and delays, then we should. They granted
summary judgment. They held that there was no genuine issue to submit to a trial judge – the
similarities between the figurines and the gremlins was insignificant and there was no evidence of
copying.
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 It is not always in a party’s interest to make a summary judgment application (nothing
happens if you lose) but r-20.06 makes it less appealing. This rule says that when the party
moves for a summary judgment loses, costs will be ordered against it on a substantial indemnity
basis and payable forthwith – this rule is softened if the court finds that there was a reasonable
basis for the motion. The intention is to have the parties think twice before making a summary
judgment application.
 Other Ontario provision is R. 21: Determination of an issue before trial. It enables parties to
submit to the court a specific legal issue and get judgment of court on that legal issue before trial.
 This is available when: 21.01(1)(a): determination of question of law where it may dispose of
all or part of the action, shorten trial, save costs. The issue is one of efficiency.
 Limitation is that because we are at pretrial phase, there may be factual disputes. If legal
issue is in some way contingent on resolution of factual dispute, court will not determine that
issue under R. 21. E.g., party may want to know what is applicable limitation period. Court may
not be in a position to resolve that specific question if facts are in dispute.
 In ON, it is enough if the determination of the issue will determine only part of the action.
 R. 21.01(1)(b) same as 165(4) in Quebec: A party may move before a judge to strike out a
pleading on the ground that it discloses no reasonable cause of action or defence. Test is
(Milgaard) from Hunt: In deciding a motion under 21.01(b), judge must assume that all facts will
be proven, and having done so, must strike the claim only if he determines that the claim could
not succeed.
 In Ontario, can strike part of a pleading, but that would only arise with respect to an entire
cause of action (not specific allegation).
 21.01(3): D may move before a judge to have an action stayed or dismissed if a) subject
matter jurisdiction, b) capacity, c) lis pendens, d) action is frivolous or vexatious or otherwise
abuse of process of court.
 So 21.01 enables parties to make motions to have action dismissed on a variety of grounds.
Also allows P to make motion to have defence thrown out if it raises no defence.
D. Matters relating to pleadings
1. Motions for particulars
QUEBEC
 Very commonly made to delay things.
 168(7): D’s right to obtain in respect of any vague or ambiguous…particulars.
 This is related to 168 (8), when the defendant has a right to a particular exhibit that will be
referred to at a hearing (ex: the contract).
 The reference refers to a right to obtain certain things and the rights come from 76, 77. These
are rules regarding drafting – if they are breached resulting in a lack of clarity, the other party can
ask for particulars. Plaintiffs draft clearly because if there is a motion for particulars, the case is
suspended until the particulars have been delivered.
 P can make motion for particulars about defence, but they usually want to get to trial.
Serabec: The judge says that pleadings are to be interpreted liberally in favour of the party that
filed them but the other party has a right to know the case that he has to meet. The defendant has
a right to know the essential facts. There is, however, no obligation to plead secondary facts. An
even more important notion from this case is that the plaintiff does not need to plead evidence
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(ex: the plaintiff must describe how the defendant caused the accident but he does not have to
describe how he will prove this).
 A frequent argument that arises at hearings over motions for particulars, is that the plaintiff
will say that the defendant already knows the answer – even better than the plaintiff. The courts
have taken the position that it doesn’t matter what the defendant knows or doesn’t know.
ONTARIO
 The motion for particulars is provided for in R-25.10, which says that where a party demands
particulars of an allegation, the party has 7 days to deliver them or the court may order their
production.
 In QC, the party must make a motion for particulars and make an oral presentation on the
presentation date or at the time set aside in the schedule. In ON, the procedure is less formal. 1st,
the party seeking particulars asks, if they are not provided, a court order can be sought.
 In Quebec, they are viewed as necessary for preparation of defence.
 In Ontario, 2 purposes:
1. The particulars are required for the purposes of the pleading. In order to respond to
the statement of claim or defence, the other party needs more info.
2. For purposes of trial. Would be helpful in order to narrow issues for trial.
 Depending on purpose, rules are slightly different.
 If you need particulars for the 1st purpose, the motion must be made before the pleading is
filed and the motion must be supported by the affidavit of the party stating that the particulars are
necessary and not w/in the party’s knowledge.
 If you need the particulars for the 2nd purpose, the motion can be made at any time prior to the
trial and there is no need for an affidavit because knowledge is irrelevant. All you are trying to
do is narrow the issues.
2. Amendments
 There are several circumstances in which it may become appropriate for a party to amend its
pleadings.
 Art. 199(2) CCP sets out circumstances in which an amendment may be appropriate - to
modify, correct or complete allegations or conclusions, to invoke new facts or to assert a right
accrued since service of the motion to institute proceedings.
 Where it talks about invoking new facts, this means that a party learned new facts subsequent
to the initial motion (ex: after the initial service, the defendant admitted liability).
 The other ground is to add another claim that occurred after service – if my tenant is 3
months behind in payment at the date of service, I can add the rest of the unpaid months at trial.
 The limits on the right to amend (cannot be useless or contrary to the ends of justice and does
not result in a new unconnected cause of action unrelated to the original one) are in 199(1).
 Procedurally, in the most recent amendments, the rules on amendments were substantially
simplified. Under 200, if you want to amend a pleading, you prepare an amended pleading, make
changes and underline the changes to notify the other party and you serve the amended pleading
on the other party. The other party has 10 days to file an opposition. If he files an opposition, the
amending party must make a motion for permission to amend. Ignoring the service for 10 days
results in deemed acceptance.
 Art. 204 says that the court may on its own motion prior to judgment order the immediate
correction of any errors of form in a pleading.
 Art. 205 says that the court may adjourn the trial and allow a motion for amendment upon
oral request.
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Munger: An individual sued the municipality for flood damage. On the morning of the trial, the
plaintiff made an oral motion to amend seeking to substitute a corporation for the individual as
the plaintiff (he owned the land through a corporation). The trial judge refused – he said that this
is not a simple correction, this is the substitution of a new plaintiff. It is contrary to the interests
of justice since in the meantime, the corporation’s prescription period passed. The CA held that
this was an appropriate case for amendment since there was no issue that this raised other than
prescription. If prescription had not expired, there would have been no reason at all to refuse the
amendment. The Court held that since the action was instituted w/in the delay and the error was a
common one and there was no prejudice, the amendment should be allowed. The municipality
should not get off the hook as a result of this error.
 In ON, r-26 deals w/amendments. 26.01 sets out the general rule that you can amend
anything at any time for any reason….
 Procedurally, there are 3 ways to amend depending on where you are in the proceedings.
 26.02(a): a party can amend w/o leave before the close of pleadings (statement of claim,
defence and reply or passing of delay for reply). Either party can amend unless the
amendment doesn’t hange who the parties are.
 26.02(b): by consent – all parties must consent and if you want to add another party, he
must consent as well.
 26.02(c): by leave of the court. You can make a motion at any stage of the proceedings.
26.01 says that the court shall grant the motion unless doing so would create a prejudice
that cannot be compensated.
 National Gypsum: A motion to amend the statement of defence on the eve of trial. The
master hearing the motion says that it would be fundamental to the basis of the whole trial and
refuses. The CA held that it may be true that the motion changes the entire defence but the
prejudice can be set-off by adjourning.
 Denton: An action in negligence against a dentist. Upon publication of a new case, the
plaintiff’s lawyer realized that on top of negligence, this can also be a claim for trespass of
person. All the facts were the same. The issue was the limitation period as the plaintiff was to
late to start an action for trespass at this point. The court said that this is just an alternative
ground for relief so there is no new cause of action raised. There would be no prejudice here so
the amendment should be allowed.
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