Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Canada's Federal Court of Appeal Decides Japan is Most Appropriate Forum in Case of Vehicles Perishing at Sea

Mitsui O.S.K. Lines Ltd. et al. v. Mazda Canada Inc. (Canada’s Federal Court of Appeal File Number A-420-07, found at 2008 FCA 219) is an important decision relating to forum non conveniens.  This decision is an appeal of a lower court decision.  Mazda Canada Inc. (“Mazda”) has instituted an action for damages against a ship and its owner after 4,813 Mazda automobiles and 110 Isuzu trucks were damaged (and later scrapped) during shipment from Japan to British Columbia (Canada).  The lower court dismissed an application filed by the Mitsui O.S.K. Lines Ltd. et al. (“Mitsui) to throw out the case on the basis that Canada was not the proper forum and Japan was the proper forum for the case to be heard.  The Federal Court of Appeal allowed the Mitsui’s appeal and threw out the case on the basis that Japan was the more appropriate forum.

 

Pursuant to Subsection 46(1) of the Maritime Liability Act (Canada), a Canadian plaintiff was entitled to sue in Canada because the destination port for some of the lost vehicles was New Westminster, British Columbia, Canada.  However, forum non conveniens arguments were available to the defendants.

 

The established Canadian case law governing the issue of forum non conveniens requires that the Court consider a non-exhaustive list of ten factors to determine if another forum is clearly and distinctly more appropriate.  The non-exhaustive 10 factors are:

(a)    the parties’ residence, and that of the witnesses and experts;

(b)   the location of the evidence;

(c)    the place where the contract was negotiated and executed;

(d)   the existence of proceedings pending between the parties in another jurisdiction;

(e)    the location of the defendant’s assets;

(f)     the applicable law;

(g)    advantages conferred upon the plaintiff by its choice of forum, if any;

(h)    the interests of justice;

(i)      the interests of the parties; and

(j)     the need to have the judgment recognized in another jurisdiction.

 

The Federal Court of Appeal held that the trial judge did not properly exercise his discretion, did not apply proper weight to some of the evidence, and could not consider new facts that have come to light.  The Federal Court of Appeal stated that “[i]n short, Japan, not Canada, is clearly the most appropriate forum for this litigation.”

 

The Federal Court of Appeal reviewed the facts in light of the above factors.  Some of the information that they considered to be significant included:

 

-         There were three complex and costly ongoing proceedings in Japan’s courts concerning the same incident;

-         The majority of the witnesses were outside Canada, many in Japan;

-         Japan’s laws were applicable to the contract and the Canadian courts would be required to apply and determine complex areas of Japan’s laws;

-         Greater damages could be applied by Canadian courts than Japan’s courts.

 

For more information about this case, please contact Cyndee Todgham Cherniak (416-307-4168), who did not represent any of the parties in the proceeding.

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