SUPREME
COURT OF CANADA
Between:
Teck
Cominco Metals Ltd.
Appellant
and
Lloyd’s
Underwriters and Seaton Insurance Company
Respondents
And Between:
Teck
Cominco Metals Ltd.
Appellant
and
Lombard
General Insurance Company of Canada
Respondent
Coram: McLachlin
C.J. and Binnie, LeBel, Deschamps, Fish, Charron and Rothstein JJ.
Reasons
for Judgment:
(paras. 1 to 41)
|
McLachlin
C.J. (Binnie, LeBel, Deschamps, Fish, Charron and Rothstein JJ. concurring)
|
______________________________
Teck Cominco Metals Ltd. v. Lloyd’s Underwriters, 2009 SCC
11, [2009] 1 S.C.R. 321
Teck Cominco Metals Ltd. Appellant
v.
Lloyd’s Underwriters and Seaton Insurance Company Respondents
- and -
Teck Cominco Metals Ltd. Appellant
v.
Lombard General Insurance Co. of Canada Respondent
Indexed as: Teck Cominco Metals Ltd. v. Lloyd’s
Underwriters
Neutral citation: 2009 SCC 11.
File No.: 32116.
2008: November 17; 2009: February 20.
Present: McLachlin C.J. and Binnie, LeBel,
Deschamps, Fish, Charron and Rothstein JJ.
on appeal from the court of appeal for british columbia
Private international law — Choice of forum — Forum
conveniens — Pollution produced by mining company in Canada but environmental
damage alleged to occur in U.S. — Environmental action against company
commenced in U.S. court — Company suing insurers for coverage in relation
to environmental damage in that court — Insurers commencing parallel
proceedings in British Columbia — Assertion of jurisdiction by U.S. court —
Whether British Columbia proceedings should be stayed given prior assertion of
jurisdiction — Court Jurisdiction and Proceedings Transfer Act, S.B.C. 2003,
c. 28, s. 11.
Teck sued its insurers in the U.S. for coverage in
relation to environmental damage alleged to have occurred in the U.S.,
downstream from its British Columbia smelter site. The insurers commenced
parallel proceedings in British Columbia seeking declaratory orders regarding
their obligation (or lack thereof) to defend or indemnify Teck. The parties
each took various steps to obtain jurisdictional rulings in order to have the
insurance coverage matter adjudicated in their preferred court: the insurers
filed a motion in the U.S. District Court seeking an order to dismiss Teck’s
claims against them, and Teck filed similar motions in British Columbia seeking
orders staying the British Columbia proceedings. The U.S. District Court
denied the insurers’ applications to dismiss Teck’s claims against them on the
basis of forum non conveniens. The British Columbia Supreme Court
refused to grant the stays sought by Teck, and the Court of Appeal upheld that
decision.
Held: The appeal should
be dismissed.
British Columbia’s Court Jurisdiction and Proceedings
Transfer Act creates a comprehensive regime that applies to all cases where
a stay of proceedings is sought on the ground that the action should be pursued
in a different jurisdiction (forum non conveniens). It requires
that in every case, including cases where a foreign judge has asserted
jurisdiction in parallel proceedings, all the relevant factors listed in
s. 11 be considered in order to determine if a stay of proceedings is
warranted. This includes the desirability of avoiding multiplicity of legal
proceedings. Section 11 is a complete codification of the common law test
for forum non conveniens admitting of no exceptions. [21‑22]
The prior assertion of jurisdiction by a foreign court
does not oust the s. 11 inquiry. The usual multifactored test under
s. 11 need not give way to a “comity‑based” test when a foreign
court positively asserts jurisdiction. Section 11 is itself a comity‑based
approach and gives due comity to foreign courts. Comity is not necessarily
served by an automatic deferral to the first court asserting jurisdiction. The
assertion of jurisdiction by the foreign court is also not an overriding and
determinative factor in the s. 11 analysis. The avoidance of multiplicity
of proceedings is only one factor, among many, to be considered. Furthermore,
the jurisprudence and policy considerations do not support a conclusion that a
foreign court’s prior assertion of jurisdiction is an overriding and
determinative factor in the forum non conveniens analysis. To adopt
such an approach would be to encourage a first‑to‑file system where
considerations having little or nothing to do with where an action is most
conveniently or appropriately heard would carry the day. Lastly, the exercise
of jurisdiction differs on an international level: a distinction should be made
between situations involving a uniform and shared approach to the exercise of
jurisdiction, such as interprovincial conflicts, and those, such as here, which
do not. Blind acceptance of a foreign court’s prior assertion of jurisdiction
carries with it the risk of declining jurisdiction in favour of a jurisdiction
which is not more appropriate. A holistic approach, in which the avoidance of
a multiplicity of proceedings is one factor among others to be considered,
better serves the purpose of fair resolution of the forum non conveniens
issue with due comity to foreign courts. [21] [23‑25] [29-30]
In this case, the chambers judge carefully considered
all of the factors mentioned in s. 11 and did not err in dismissing Teck’s
motions to stay the British Columbia proceedings. While a court should strive
to avoid parallel proceedings, the desire to avoid them cannot overshadow the
objective of the forum non conveniens analysis which is to ensure, if
possible, that the action is tried in the jurisdiction that has the closest
connection with the action and the parties. [32] [38]
Cases Cited
Distinguished: 472900
B.C. Ltd. v. Thrifty Canada, Ltd. (1998), 168 D.L.R. (4th) 602; Westec
Aerospace Inc. v. Raytheon Aircraft Co., 1999 BCCA 243, 67 B.C.L.R. (3d)
278; Ingenium Technologies Corp. v. McGraw‑Hill Cos., 2005 BCCA
358, 49 B.C.L.R. (4th) 120; Amchem Products Inc. v. British Columbia
(Workers’ Compensation Board), [1993] 1 S.C.R. 897.
Statutes and Regulations Cited
Comprehensive Environmental Response,
Compensation, and Liability Act, 42 U.S.C. §§ 9601‑9675.
Court Jurisdiction and
Proceedings Transfer Act, S.B.C. 2003, c. 28,
s. 11.
Authors Cited
Black, Vaughan, and John Swan. “Concurrent Judicial
Jurisdiction: A Race to the Court House or to Judgment?” (2008), 46 Can.
Bus. L.J. 292.
Uniform Law Conference of Canada. Uniform
Law Conference of Canada — Commercial Law Strategy. Ottawa: The Conference,
2005 (loose‑leaf updated 2008).
APPEAL from a judgment of the British Columbia Court of
Appeal (Newbury, Mackenzie and Kirkpatrick JJ.A.), 2007 BCCA 249, 67 B.C.L.R.
(4th) 101, 279 D.L.R. (4th) 257, [2007] 7 W.W.R. 281, 240 B.C.A.C. 218, 48
C.C.L.I. (4th) 1, 28 C.E.L.R. (3d) 191, 39 C.P.C. (6th) 20, [2007] B.C.J.
No. 841 (QL), 2007 CarswellBC 864, affirming a decision of Davies J., 2006
BCSC 1276, 60 B.C.L.R. (4th) 261, [2006] 12 W.W.R. 486, 40 C.C.L.I. (4th) 182,
24 C.E.L.R. (3d) 1, 31 C.P.C. (6th) 34, [2006] B.C.J. No. 1917 (QL), 2006
CarswellBC 2083. Appeal dismissed.
Gordon C. Weatherill,
Craig A. B. Ferris and Lisa A. Peters, for the
appellant.
Graeme Mew and Anna
Casemore, for the respondent Lloyd’s Underwriters.
Written submissions only by Gary M. Nijman,
for the respondent Seaton Insurance Company.
James H. MacMaster, Michael
J. Sobkin and Christopher A. Rhone, for the respondent Lombard
General Insurance Co. of Canada.
The judgment of the Court was delivered by
[1]
The Chief Justice — Teck
Cominco Metals Ltd. (“Teck”) sued the Lombard General Insurance Co. of Canada
(“Lombard”), Lloyd’s Underwriters (“Lloyd’s”) and Seaton Insurance Co.
(“Seaton”) (collectively referred to as the “Insurers”) for coverage in
relation to environmental damage alleged to have occurred in the United States,
downstream from Teck’s British Columbia smelter. Teck commenced its action in
Washington State. The Insurers commenced parallel coverage proceedings in
British Columbia. The issue on this appeal is whether the British Columbia
proceedings should be stayed. The courts below ruled they should not be
stayed. I agree with that result, and would dismiss the appeal.
I. Facts
[2]
Teck has various mining and smelting operations in British Columbia. In
2002 and 2003 it gave notice to the Insurers of four claims or potential claims
in respect of environmental damage arising from activities of a predecessor
company, Cominco Ltd. The claims or potential claims arose from Cominco’s
operations in four British Columbia sites: Port McNeill, Pinchi Lake, Vancouver
and Trail.
[3]
The largest claim arises from the discharge of waste material known as
“slag” into the Columbia River adjacent to Teck’s smelter in Trail. Allegedly,
the discharge accumulated in the Upper Columbia River and Lake Roosevelt in
Washington State. In an action filed in the U.S. District Court in 2004 (the
“U.S. Environmental Action”), numerous private citizens and the State of
Washington seek to hold Teck liable under a U.S. statute (the Comprehensive
Environmental Response, Compensation, and Liability Act, 42 U.S.C. __ 9601-9675) for environmental property
damage allegedly caused by the contamination.
[4]
Teck takes the position that the Insurers are required to defend and
indemnify it in the U.S. Environmental Action. In the period of 1958 to 1985,
Cominco Ltd. purchased general and excess liability insurance policies from the
Insurers (the “Policies”). Apart from coverage limits, the Policies provide
similar coverage, requiring each insurer to defend and indemnify Teck in the
event of any alleged liability resulting from an occurrence of property damage
taking place during the period of coverage anywhere in the world. Teck says
that the alleged contamination in Washington State is covered by the Policies.
[5]
The Insurers deny that they are obligated to compensate Teck on various
grounds.
[6]
The extent of the damages faced by Teck in the U.S. Environmental Action
is not known; however, it is expected to exceed the limits underlying each of
the policies, which collectively total over $779 million. (See motions
judgment, 2006 BCSC 1276, 60 B.C.L.R. (4th) 261, at paras. 35 and 63, and Court
of Appeal judgment, 2007 BCCA 249, 67 B.C.L.R. (4th) 101, at paras. 16-17.)
[7]
On November 23, 2005, Teck commenced an action in the Washington State
Superior Court seeking a declaratory judgment regarding its right to insurance
coverage under the Policies in respect of the U.S. Environmental Action (the
“U.S. Coverage Action”). On that same day, Lloyd’s commenced an action in the
Supreme Court of British Columbia seeking declaratory orders regarding their
obligation (or lack thereof) to defend or indemnify Teck in respect of the
claims or potential claims concerning the four British Columbia sites. Seaton,
a defendant in the Lloyd’s action, also filed a counterclaim. Lombard
subsequently filed a similar action to Lloyd’s. (The Insurers’ actions are
collectively referred to as the “B.C. Coverage Action”.)
[8]
The parties have each taken various steps to obtain jurisdictional
rulings in order to have the insurance coverage matter adjudicated in their
preferred court. As a result, the U.S. Coverage Action was moved from the
Washington State Superior Court to the United States District Court for the
Eastern District of Washington (“U.S. District Court”). The Insurers filed a
motion in the U.S. District Court seeking an order to dismiss Teck’s claims
against them in the U.S. Coverage Action. Teck filed similar motions in the
British Columbia Supreme Court seeking orders staying the B.C. Coverage Action.
[9]
On May 1, 2006, Suko J. of the U.S. District Court denied the Insurers’
applications to dismiss Teck’s claims against them on the basis of forum non
conveniens.
[10]
By agreement of the parties, the U.S. District Court temporarily
stayed the proceedings in the U.S. Coverage Action pending this Court’s
disposition of the appeal.
II. Judicial History
A. Supreme Court of British
Columbia (Davies J.), 2006 BCSC 1276, 60 B.C.L.R. (4th) 261
[11]
The chambers judge held that s. 11 of the Court Jurisdiction and
Proceedings Transfer Act, S.B.C. 2003, c. 28 (“CJPTA”), is “part of
a comprehensive remedial statutory scheme that is intended to codify the
determination of jurisdictional issues in British Columbia” (para. 102). He
denied the stay of the B.C. Coverage Action on the grounds that:
·
The convenience and expense of the parties and potential witnesses
favoured litigation in British Columbia rather than Washington State, having
regard to: the residence of the parties and where each carries on business; the
fact that the issues in the coverage actions (disclosure, risk assessment and
interpretation issues related to coverage and exclusions) have little, if any,
connection to Washington State; and the fact that the overall cost of
litigation would be greater if the coverage action proceeded in Washington
State.
·
The law to be applied to issues in the action would likely be British
Columbia law. Washington law would not apply because: the potential Washington
victims are not beneficiaries to the Policies; the Insurers’ obligations are
only to Teck; the coverage action involves declarations in relation to British
Columbia sites; and all of Teck’s alleged wrongful actions, while affecting
foreign residents, occurred solely in British Columbia.
·
The desirability of avoiding multiplicity of legal proceedings and
avoiding conflicting decisions in different courts requires a multi-factored
analysis, in which the prior assertion of jurisdiction by the U.S. District
Court is an important but not determinative factor.
·
Any damage award ordered by the U.S. District Court would be enforceable
in British Columbia. While enforcement of any declaratory judgment could be
more problematic, as a practical matter, it was unlikely that Teck would have
to resort to execution proceedings to obtain satisfaction from the Insurers.
·
The fair and efficient working of the Canadian legal system as a whole
favoured litigation in British Columbia, as it would not be efficient to have
contracts of insurance interpreted in accordance with more than one system of
law.
[12]
Considering all the factors in s. 11 of the CJPTA, the chambers
judge found that British Columbia was the jurisdiction with the closest
connection to Teck and the subject matter of the coverage action (the
Policies). Consequently, on August 21, 2006, he refused to grant the stays
sought by Teck in the B.C. Coverage Action.
B. Court of Appeal for British Columbia
(Newbury, Mackenzie and Kirkpatrick JJ.A.), 2007 BCCA 249, 67 B.C.L.R.
(4th) 101
[13]
Newbury J.A., writing for the court, found that the chambers judge
properly considered and weighed each factor in s. 11(2) of the CJPTA.
She agreed with Davies J. that the principle of comity did not require
deference to the first court to assert jurisdiction. Finding no error in
Davies J.’s conclusion that British Columbia was the more appropriate forum for
the trial of the coverage action, Newbury J.A. dismissed Teck’s appeal.
III. Relevant Statutory Provisions
[14]
Section 11 of the CJPTA provides that:
11(1) After considering the interests of the parties
to a proceeding and the ends of justice, a court may decline to exercise its
territorial competence in the proceeding on the ground that a court of another
state is a more appropriate forum in which to hear the proceeding.
(2) A court, in deciding the question of whether it or a court
outside British Columbia is the more appropriate forum in which to hear a
proceeding, must consider the circumstances relevant to the proceeding,
including
(a) the comparative convenience and expense for the parties to the
proceeding and for their witnesses, in litigating in the court or in any
alternative forum,
(b) the law to be applied to issues in the proceeding,
(c) the desirability of avoiding multiplicity of legal proceedings,
(d) the desirability of avoiding conflicting decisions in different
courts,
(e) the enforcement of an eventual judgment, and
(f) the fair and efficient working of the Canadian
legal system as a whole.
IV. Issues
[15]
The only issue on this appeal is whether the coverage proceedings
commenced in British Columbia should be stayed, in view of the prior parallel
proceedings in Washington State and the assertion of jurisdiction by the U.S.
District Court. Resolving this issue requires us to consider the application
of s. 11 of the CJPTA in circumstances where prior proceedings have been
commenced outside British Columbia and the foreign court has refused to stay
its action.
[16]
The reasons will go on to consider whether the chambers judge acted
properly in rejecting the Teck’s application to decline jurisdiction and stay
the B.C. Coverage Action, having regard to the appropriate test.
V. Analysis
A. Whether the Section 11 Test Iis Trumped by
a Comity-Based Test
[17]
Teck submits that where a foreign court has assumed jurisdiction in
parallel proceedings, the usual multifactored test under s. 11 of the CJPTA must
give way to a “comity-based” test that respects the foreign court’s decision to
take jurisdiction.
[18]
In favour of this approach, Teck argues that there is a distinction
between a situation where it is submitted that a foreign court would be the
appropriate forum, and the situation where a foreign court has in fact
asserted jurisdiction. A foreign court can be said to have asserted
jurisdiction when it has been asked to decline its jurisdiction over the matter
and has refused to do so, holding that it is the appropriate forum to hear the
dispute. Teck argues that where a foreign court has asserted jurisdiction on
the basis of factors similar to those found in s. 11 of the CJPTA, s. 11
does not apply and the court may decline jurisdiction simply on the basis that
the foreign court has asserted jurisdiction, and that comity requires that the
domestic court recognize that prior assertion of jurisdiction.
[19]
An alternative, slightly softer version of this argument is that
assertion of jurisdiction by the foreign court is a factor of overwhelming
significance in the determination of whether the local forum is appropriate (forum
conveniens) and that, since the U.S. District Court has positively asserted
jurisdiction, the British Columbia courts are effectively bound to stay the
parallel actions in British Columbia.
[20]
I will consider each of these arguments in turn.
[21]
The first argument is that s. 11 of the CJPTA does not apply
where a foreign court has asserted jurisdiction. I cannot agree. The CJPTA
creates a comprehensive regime that applies to all cases where a stay of
proceedings is sought on the ground that the action should be pursued in a
different jurisdiction (forum non conveniens). It requires that
in every case, including cases where a foreign judge has asserted jurisdiction
in parallel proceedings, all the relevant factors listed in s. 11 be considered
in order to determine if a stay of proceedings is warranted. This includes the
desirability of avoiding multiplicity of legal proceedings. But the prior
assertion of jurisdiction by a foreign court does not oust the s. 11 inquiry.
[22]
Section 11 of the CJPTA was intended to codify the forum non
conveniens test, not to supplement it. The CJPTA is the product of
the Uniform Law Conference of Canada. In its introductory comments, the
Conference identified the main purposes of the proposed Act, which included
bringing “Canadian jurisdictional rules into line with the principles laid down
by the Supreme Court of Canada in Morguard Investments Ltd. v. De Savoye,
[1990] 3 S.C.R. 1077, and Amchem Products Inc. v. British Columbia (Workers’
Compensation Board), [1993] 1 S.C.R. 897” (Uniform Law Conference of Canada
— Commercial Law Strategy (loose-leaf), at p. 3). Further, the drafters of
the model Act confirmed that s. 11 of the CJPTA was intended to codify
the common law forum non conveniens principles in “comments to section
11”:
11.1 Section 11 is meant to codify the doctrine of forum non
conveniens, which was most recently confirmed by the Supreme Court of Canada in
Amchem Products Inc. v. British Columbia (1993). The language of subsection
11(1) is taken from Amchem and the earlier cases on which it was based. The
factors listed in subsection 11(2) as relevant to the court’s discretion are
all factors that have been expressly or implicitly considered by courts in the
past. [p. 11]
Section 11 of
the CJPTA thus constitutes a complete codification of the common law
test for forum non conveniens. It admits of no exceptions.
[23]
Teck submits that the usual multifactored test under s. 11 of the CJPTA
must give way to a “comity-based” test when a foreign court positively asserts
jurisdiction. To the extent this argument implies that the usual test does not
give due comity to foreign courts, it must be rejected. Section 11 of the CJPTA
is itself a comity-based approach. As will be discussed, comity is not
necessarily served by an automatic deferral to the first court that asserts
jurisdiction. It follows that Teck’s argument, that s. 11 does not apply where
a foreign court has already asserted jurisdiction over the matter, cannot
succeed.
[24]
Alternatively, it is argued that if s. 11 applies, the assertion of
jurisdiction by the foreign court is an overriding and determinative factor in
the s. 11 analysis. This argument also must be rejected.
[25]
First, had actual assertion of jurisdiction by a foreign court been seen
as a factor that should override all others, one would have expected the
legislature to have stated this expressly. Rather, avoidance of multiplicity
of proceedings is simply listed along with other factors. This suggests that
the existence of foreign proceedings is only one factor, among many, to be
considered in a forum non conveniens analysis.
[26]
Second, the authorities are against this contention. Teck says 472900
B.C. Ltd. v. Thrifty Canada, Ltd. (1998), 168 D.L.R. (4th) 602 (B.C.C.A.), Westec Aerospace Inc. v. Raytheon Aircraft Co., 1999 BCCA 243, 67 B.C.L.R. (3d) 278, and Ingenium Technologies
Corp. v. McGraw-Hill Cos., 2005 BCCA 358, 49 B.C.L.R. (4th) 120, support
the fact that a prior assertion of jurisdiction is a factor of overwhelming
significance. In Thrifty, the British Columbia Supreme Court declined
to stay its proceedings in view of a prior assertion of jurisdiction by the
Ontario court over a parallel action. The Court of Appeal allowed the appeal
on the basis that the chambers judge erred by giving no weight to the fact the
parties had expressly agreed that the contract would be interpreted in
accordance with Ontario law and had agreed to attorn to the jurisdiction of the
court of Ontario. Ultimately, it was the various connections to Ontario, not
simply the prior assertion of jurisdiction by the Ontario court, that warranted
the granting of a stay in the British Columbia proceedings.
[27]
In Westec, the defendant commenced an action in Kansas. Shortly
thereafter, the plaintiff sued in British Columbia. The Court of Appeal, in
determining whether to grant a stay in the British Columbia action, considered
a number of factors, including: place of incorporation, place of business,
location of assets and the formation and performance of the contract. (Unlike Thrifty,
the foreign court had not asserted jurisdiction.) The Court of Appeal
concluded that both fora had “a real and substantial connection to the dispute”
(para. 46) and ultimately decided to stay the British Columbia action on the
basis that the plaintiff had failed to establish a juridical advantage that
would be lost if the proceedings were stayed.
[28]
The final case relied on by Teck is Ingenium. In Ingenium,
the British Columbia Court of Appeal reviewed the chambers judge’s decision not
to stay the British Columbia action in the face of a positive assertion of
jurisdiction by the U.S. District Court for the Southern District of New York
over parallel proceedings in New York. The Court of Appeal found that the
chambers judge was correct in concluding that “the existence of parallel
proceedings does not trump all other factors” (para. 9). However, the court
went on to allow the appeal on the basis that the chambers judge erred in
attaching no significance to the fact the U.S. District Court had positively
asserted jurisdiction in her analysis. I do not consider that Ingenium laid
down a new test for the determination of forum non conveniens in cases
where a foreign court has assumed jurisdiction in parallel proceedings.
[29]
Finally, policy considerations do not support making a foreign court’s
prior assertion of jurisdiction an overriding and determinative factor in the forum
non conveniens analysis. To adopt this approach would be to encourage a
first-to-file system, where each party would rush to commence proceedings in
the jurisdiction which it thinks will be most favourable to it and try to delay
the proceedings in the other jurisdiction in order to secure a prior assertion
in their preferred jurisdiction. Technicalities, such as how long it takes a
particular judge to assert jurisdiction, might be determinative of the
outcome. In short, considerations that have little or nothing to do with where
an action is most conveniently or appropriately heard, would carry the day.
Such a result is undesirable and inconsistent with the language and purpose of
s. 11, discussed above.
[30]
Also, the extent to which approaches to the exercise of jurisdiction
differ on an international level also weighs in favour of rejecting Teck’s
approach. A distinction should be made between situations that involve a
uniform and shared approach to the exercise of jurisdiction (e.g.
interprovincial conflicts) and those, such as the present, that do not. In the
latter, blind acceptance of a foreign court’s prior assertion of jurisdiction
carries with it the risk of declining jurisdiction in favour of a jurisdiction
that is not more appropriate. A holistic approach, in which the avoidance of a
multiplicity of proceedings is one factor among others to be considered, better
serves the purpose of fair resolution of the forum non conveniens issue
with due comity to foreign courts.
[31]
For the foregoing reasons, I conclude that s. 11 of the CJPTA
applies to the motions before the British Columbia courts to decline
jurisdiction, and that the prior assertion of jurisdiction by the U.S. District
Court is merely one factor to be considered, among others.
B. Applying the Proper Principles, Did the
Chambers Judge Err in Permitting the B.C. Coverage Action to Continue?
[32]
As set out earlier, the chambers judge dismissed Teck’s motions to stay
the B.C. Coverage Action. In arriving at this conclusion, the chambers judge
carefully considered all of the factors mandated for consideration by s. 11(2)
of the CJPTA, namely: the comparative convenience and expense for the
parties to the proceeding and for their witnesses, in litigating in the court
or in any alternative forum (s. 11(2)(a)); the law to be applied to issues in
the proceeding (s. 11(2)(b)); the desirability of avoiding multiplicity of
legal proceedings (s. 11(2)(c)); the desirability of avoiding conflicting
decisions in different courts (s. 11(2)(d)); the enforcement of an eventual
judgment (s. 11(2)(e)); and the fair and efficient working of the Canadian
legal system as a whole (s. 11(2)(f)).
[33]
Before this Court, Teck argued that the chambers judge erred in
disregarding the fact that the insurance coverage sought was in relation to
damages claimed in Washington State. Teck submits that the U.S. District
Court’s assertion of jurisdiction should be respected because the issues in the
environmental action brought by Washington residents under U.S. legislation may
impact on the issue of insurance coverage in this action.
[34]
The difficulty with this submission is that the chambers judge carefully
considered these arguments and the totality of the evidence before him. Having
done so, he determined that the central issues in the coverage actions
(disclosure, risk assessment, and policy interpretation) weighed in favour of
British Columbia, and that the only coverage issues properly the substance of
the U.S. Environmental Action are inconsequential.
[35]
He was alive to the fact that the environmental damage had occurred in
Washington State, but held that that fact alone did not lead to the conclusion
that foreign law should apply to the coverage action. On the contrary, he
concluded that it would be unreasonable to apply Washington law because, inter
alia, Teck’s alleged wrongful actions occurred solely in Canada, the
proceedings involved other British Columbia sites with no connection to
Washington State, and the Washington residents are not beneficiaries to the
Policies.
[36]
The chambers judge was also alive to the concern that on a forum non
conveniens application, the court should strive to avoid a situation where
two jurisdictions may be dealing with the same subject matter. While finding
the U.S. District Court’s prior assertion of jurisdiction to be a factor of
high importance, he concluded that it could not prevail in view of the fact
British Columbia was the forum most closely connected with Teck and the
Policies, and that Washington State, a jurisdiction with at best a tenuous
connection to the parties and the Policies, was not an appropriate forum.
[37]
I see no error in the reasons or the conclusion of the chambers judge.
He considered all the relevant factors under s. 11 of the CJPTA. Those
factors support his decision to refuse to stay the B.C. Coverage Action.
[38]
Teck argues that a refusal to stay the B.C. Coverage Action places the
parties in the difficult position of having legal proceedings on the issue of
insurance coverage in two separate jurisdictions. While I am sympathetic to
the difficulties presented by parallel proceedings, the desire to avoid them
cannot overshadow the objective of the forum non conveniens analysis,
which is “to ensure, if possible, that the action is tried in the jurisdiction
that has the closest connection with the action and the parties” (Amchem Products
Inc. v. British Columbia (Workers’ Compensation Board), [1993] 1 S.C.R.
897, at p. 912).
[39]
Teck also argues that to allow the coverage action to proceed in British
Columbia raises problems with regard to the enforcement of any judgment
obtained in the U.S. Coverage Action. If the U.S. District Court proceeding
(which has been temporarily stayed pending the outcome of this appeal) were to
conclude first, the resultant judgment would ordinarily be enforceable in
Canada. Would the British Columbia court be bound to recognize the judgment,
thus effectively nullifying the British Columbia proceeding? Or would
recognition of the foreign judgment be precluded on the basis that there is
ongoing litigation on the same subject matter in British Columbia? Professor
Black and Mr. Swan suggest the availability of three approaches to this
problem: (1) a race where the first judgment handed down prevails; (2) an
absolute preference for local proceedings; or (3) a middle ground that adopts a
general first-to-judgment rule but affords additional defences to enforcement
that may be engaged in some circumstances: V. Black and J. Swan, “Concurrent
Judicial Jurisdiction: A Race to the Court House or to Judgment?” (2008), 46 Can.
Bus. L.J. 292.
[40]
I do not propose to answer this question, as it was not fully developed
in the courts below or before us; nor is the answer necessary in order to
dispose of the appeal. As mentioned above, the enforcement issue was disposed
of by the chambers judge on the basis that he was satisfied that it was
unlikely that Teck would have to resort to execution proceedings in order to
obtain satisfaction from the Insurers.
VI. Conclusion
[41]
For the foregoing reasons, I would dismiss the appeal, costs to the
respondents.
Appeal dismissed with costs.
Solicitors for the appellant: Lawson Lundell, Vancouver.
Solicitors for the respondent Lloyd’s Underwriters: Nicholl, Paskell‑Mede,
Toronto.
Solicitors for the respondent Seaton Insurance Company: Alexander
Holburn Beaudin & Lang, Vancouver.
Solicitors for the respondent Lombard General Insurance Co. of
Canada: Branch, MacMaster, Vancouver.