Date: 20111121
Docket: A‑176‑11
Citation:
2011 FCA 319
CORAM: NOËL J.A.
TRUDEL J.A.
MAINVILLE J.A.
BETWEEN:
ALCAN
PRIMARY METAL
a division of RIO TINTO ALCAN INC.
Appellant
and
GROUPE MARITIME VERREAULT INC.
Respondent
and
The
owners and others interested
by
the tug STEVNS ICECAP
Mis‑en‑cause
REASONS FOR JUDGMENT
Noël J.A.
[1]
This is an appeal by
Alcan Primary Metal, a division of Rio Tinto Alcan Inc., (the appellant) from a
decision of the Federal Court, wherein Justice Pinard (the Federal Court judge)
dismissed its motion to object to the jurisdiction of the Federal Court.
[2]
The
appellant is challenging the Federal Court’s jurisdiction to rule on the action
filed by Groupe Maritime Verreault Inc. (the respondent). The appellant
contends that the Quebec civil courts have sole jurisdiction to hear the
respondent’s claim because it is a purely civil dispute and federal law is not
essential to the disposition of the case. In the
appellant’s view, the Federal Court judge committed a number of errors in
reaching the opposite conclusion.
[3]
For the
reasons that follow, I am of the opinion that the respondent’s claim falls within
Canadian maritime law and that the Federal Court judge rightly dismissed the
appellant’s motion.
RELEVANT FACTS
[4]
The dispute
between the parties is contractual in nature. It stems from the contract
they entered into on June 10, 2008. I think
it is useful to reproduce this contract in its entirety, with the addition of
numbered paragraphs for ease of reference (Appeal Book, pages 29 and 30):
[translation]
La Baie, June 10, 2008
AGREEMENT BETWEEN:
ALCAN PRIMARY METAL
262 1re Rue, P.O. Box 10
La Baie, Quebec G7B 3R1
Canada
HERE REPRESENTED BY Eric Favre,
Assistant to the
Superintendent,
Port Operations
Management.
And:
Ivan Bauret
Title: Port Facilities Director
AND
GROUPE MARITIME VERREAULT
146 PRINCIPALE STREET
LES MÉCHINS, QUEBEC
G0J 1T0
HERE REPRESENTED BY Francis Mimeault,
Executive Vice‑president
[1] Whereas Alcan wishes to either replace, repair,
sell for subsequent lease or increase the capacities of both tugs currently in
its ownership, that is, the “Alexis Simard”, having a capacity of 35 (thirty‑five)
tonnes, and the “Grande Baie”, having a capacity of 27 (twenty‑seven)
tonnes, to attain respective capacities ranging from 40 to 60 (forty to sixty)
tonnes.
[2] Whereas Groupe Maritime Verreault wishes to
assist Alcan in its search for a sustainable and worthwhile solution to its
problem.
THE PARTIES AGREE AS FOLLOWS:
[3] Groupe Maritime Verreault undertakes to seek out
one or more new or used tugs, meeting Alcan’s needs, to be sold to Alcan or
purchased and leased to Alcan, whatever Alcan decides.
[4] If Groupe Maritime Verreault finds one or more
tugs meeting Alcan’s needs, and Alcan decides to purchase the tug or tugs in
question, Alcan agrees to have Groupe Maritime Verreault charge up to 5%
(five percent) commission on the transaction price, this being considered
the usual commission in transactions of this type.
[5] If Groupe Maritime Verreault finds one or more
tugs meeting Alcan’s needs, and Alcan decides to lease them from Groupe
Maritime Verreault for a predetermined period, both parties must then agree on
a lease price, which will include fees for commissioning in La Baie,
maintenance fees, depreciation fees, financing fees and amortization fees for
normal use of the vessel(s) thus leased, in addition to a normal profit for
such use. All other operating costs, whether for fuel, operator wages or
various insurance policies or on account of any abnormal use, incidents,
accidents or other items, will be borne by Alcan.
[6] Alcan agrees to refrain from directly or
indirectly soliciting the owners and/or brokers representing the owners of the
tugs that Groupe Maritime Verreault finds for purchase or lease by Alcan and
also agrees, if ever Alcan is solicited by those owners or by the brokers
representing those owners, to refuse to enter into the purchase or lease
transaction or transactions for the tugs thus found without going through
Groupe Maritime Verreault.
[7] In either of those two (2) cases, if Alcan
leases or acquires those tugs, Alcan agrees to protect and pay the commission
to Groupe Maritime Verreault.
[8] If Alcan purchases the tug or tugs through
Groupe Maritime Verreault, the contract must include an agreement by which that
Alcan undertakes to have all manner of maintenance and/or repairs performed by
Groupe Maritime Verreault.
Signed at La Baie on this 10th day of June 2008‑06‑10
ALCAN: ______________________________
Eric
Favre
Assistant
to the Superintendent
Port
Operations Management
ALCAN: ______________________________
Ivan
Bauret
Port
Facilities Director
GRPE MARITIME VERREAULT: ______________________________
Francis
Mimeault
Executive
Vice‑president
[5]
It is the brokerage
component of this contract that is at the root of the current dispute. In its
action in Federal Court, the respondent contended that, in accordance with
paragraphs 3, 6 and 7, it had identified and put the appellant in contact
with the owner of two tugs likely to meet the appellant’s needs, one of which
was located in Denmark and the other, in Norway. The respondent added that, in
accordance with paragraph 4 of the contract, the appellant had paid it an
initial commission (reduced by agreement to two percent) following the
purchase of the tug “Stevns Iceflower”.
[6]
The dispute arose after
the appellant purchased the second tug, the “Stevns Icecap”. The respondent
alleged having learned, in 2011, that the appellant had made this acquisition
from the same owner without the respondent’s knowledge, and claimed
five percent commission under the terms of the contract.
[7]
Aiming to have this
action struck, the appellant filed a motion to object to the jurisdiction of
the Federal Court under Rule 208(d) of the Federal Courts Rules,
SOR/98‑106. The relevant legislative provisions are set out in the Annex.
DECISION OF THE FEDERAL COURT
[8]
The Federal Court judge
dismissed the appellant’s motion. After summarizing the facts, he reviewed the
principles from ITO‑Int’l Terminal Operators v. Miida Electronics,
[1986] 1 S.C.R. 752 [ITO] and Monk Corp. v. Island Fertilizers Ltd.,
[1991] 1 S.C.R. 779 [Monk], decisions in which the Supreme Court of Canada
charted out the Federal Court’s jurisdiction in matters of maritime law.
[9]
The bulk of the Federal
Court judge’s analysis is found at pages 4 and 5 of his reasons:
[translation]
It should be noted that in Monk, the party denying the
jurisdiction of the Federal Court submitted that the contract at issue
contemplated the purchase and sale of wares; it was a case in which there was
nothing maritime about the wares (fertilizer) and in which neither of the
parties was carrying on a maritime business (the plaintiff was a fertilizer
broker, and the defendant, a wholesale fertilizer distributor).
In this case, however, given the text of the agreement between the
parties and the nature and context of Group Maritime Verreault’s claim, I am of
the opinion that this agreement is maritime in nature, in accordance with the
analyses set out in Monk and ITO, above. Indeed, both parties
carried on maritime activities—Alcan as the operator of a port and the owner of
tugs used for mooring ships, and Groupe Maritime Verreault as a supplier of
maritime services, including sales of ships and brokerage services connected to
the purchase of ships. Groupe Maritime Verreault’s claim of a commission is connected
to its brokerage services for the purchase of a ship, an undoubtedly maritime
matter falling within maritime law. Against this backdrop, I am of the opinion
that Groupe Maritime Verreault’s claim is integrally connected to maritime
matters to the point that it legitimately constitutes Canadian maritime law,
over which Parliament has jurisdiction.
POSITION OF THE APPELLANT
[10]
The
appellant characterizes its contract with the respondent as a [translation] “contract for services”
(Appellant’s Memorandum, paragraph 4). It contends that this
contract consisted of two parts, the first of which contemplated the search for
tugs in consideration for a commission, and the second of which, in the event
of a sale, bound the appellant to entrust the maintenance and repairs of the
tugs to the respondent (ibidem). The
appellant submits that the claim in this case is derived from the first part of
the contract, which consists of a brokerage agreement, a matter outside the
Federal Court’s maritime jurisdiction.
[11]
The
appellant notes, relying on ITO, that Canadian maritime law is composed
of two bodies of law and contends that neither of the two applies to the
respondent’s claim. It argues that the jurisdiction emanating from the Admiralty
Act or any other statute of the same nature until 1934 does not apply
because the claim is not connected to it (idem, paragraphs 18 and
19). As for the second component—the body of
law that would have come within the Exchequer Court’s admiralty jurisdiction if it had had unlimited
jurisdiction in relation to maritime and admiralty matters, while avoiding
encroachment on property and civil rights—the appellant contends that it does
not apply, relying on Monk.
[12]
In that
case, the Supreme Court used the following analysis framework for applying the
second component: “one must begin by asking whether the claims made by Monk are
so integrally connected to maritime matters as to be legitimate Canadian
maritime law within federal competence” (Monk, pages 795 and 796). According to the
appellant, the claim in the case at bar does not have such a maritime aspect.
It is grounded in the specific performance of the
obligation resulting from the “brokerage” part of the contract.
[13]
Using
another line of reasoning, the appellant submits that the Federal Court judge
could not, in the absence of a supporting affidavit, accept as fact the
following statement by counsel for the respondent (Appeal Book, page 39):
In fact, the case at bar is much more obviously maritime than was Monk.
In this case, unlike Monk, both parties are engaged in maritime
endeavours, [Rio Tinto Alcan inc.] as the operators of a port and owners of
tugs required for the berthing of ships, Verreault as general providers of
marine services, including sales and purchase brokerage in relation to ships,
and the object of the transaction was, indeed, the purchase of ships, all of
which are “integrally connected to maritime matters”.
[Emphasis added]
[14]
According
to the appellant, the Federal Court judge confused the nature and the object of
the contract between the appellant and the respondent with the nature and the object
of the contract of sale concluded between the appellant and the seller of the
tugs (Appellant’s Memorandum, paragraphs 33 to 35). He did not take
into account that the two contracts are independent (idem,
paragraph 36).
[15]
In this regard, the appellant is relying on the decision by
Justice MacKay in Amirault v. Prince Nova (The), [1998] F.C.J. No. 557
[Prince Nova]. In that case, Justice
MacKay suggested that the fact that an action in damages is based on the breach
of a brokerage agreement rather than a sales contract could lead to a different
result in terms of whether the matter falls within the Federal Court’s maritime
jurisdiction. (idem, paragraph 39).
[16]
Finally,
the appellant notes that in John E. Canning Ltd. v. Tripap Inc., [2000]
F.C.J. No. 418 [John Canning], the Federal Court ruled that a
contract contemplating a number of undertakings, some of which were maritime
(the obligation to provide carriage of wood by sea), could be severed and that
the claim at issue in that case (termination of a contract for the sale of
wares) did not trigger the Federal Court’s maritime jurisdiction (idem,
paragraph 41).
ANALYSIS AND DECISION
[17]
In my
opinion, the Federal Court judge correctly identified and applied the approach
derived from ITO and Monk and was right in concluding that the
respondent’s claim falls within Canadian maritime law.
[18]
Before the
appellant’s arguments are addressed, it is appropriate to consider the contract
underlying the claim. The contract shows that the appellant’s tugs were no longer
adequate for it to carry out its port operations. In search of tugs having a greater capacity, the appellant
entrusted the respondent, a purveyor of maritime services, with the task of
finding vessels that could meet its needs. In
exchange, the appellant promised to pay a commission calculated on the selling
price of any tugs purchased from owners “found” for it by the respondent.
[19]
According
to the respondent’s contentions, which must be held as true in the context of
this dispute, it is as a result of the steps taken by the respondent that the
appellant acquired the “Stevns Iceflower”. The respondent contends
that the same applies for the “Stevns Icecap” and, therefore, requests that the
appellant abide by the terms of the contract it signed and pay the commission
owing to the respondent for this second purchase.
[20]
Addressing
the appellant’s arguments, I note, first, that no affidavit was required to
establish that the parties to the contract are both engaged in maritime
activities. On the one hand, the contract aims to allow the appellant
to acquire tugs meeting its needs and is signed on the appellant’s behalf by
the [translation] “Assistant to
the Superintendent of Port Operations” and the [translation] “Port Facilities Director”. The statement that the appellant operates a port in the
context of its aluminum works need not be substantiated further. As for the respondent, the fact that the appellant used its
services to find a solution to the [translation]
“problem” described at paragraphs 1 and 2 of the contract suffices to
establish its maritime vocation and, in particular, its role as a supplier of
brokerage services for the purchase of vessels.
[21]
There is
also no merit to the argument that the resolution of this dispute does not
depend on any specific rule of Canadian maritime law. According to the appellant,
the provisions of the Civil Code of Québec governing mandate are more
complete and better suited to resolving the dispute. In my opinion, this fails to take into account the plenary
nature of Canadian maritime law and the fact that it is the same no matter
where it applies (ITO, p. 779):
. . . Canadian maritime law is a body
of federal law encompassing the common law principles of tort, contract and
bailment. I am also of the
opinion that Canadian maritime law is uniform throughout Canada, . . .
[22]
The
appellant’s case rests entirely on the distinction it draws between the
purchase of the tugs, an eminently maritime activity, and the brokerage
services which enabled it to make that purchase. In my opinion, the two are
inseparable. The problem identified in the
contract and the goal sought out by signing it, that is, the leasing or
acquisition by the appellant of two tugs meeting its needs, go hand in hand.
The jurisdictional issue raised by the appellant
cannot be resolved by disregarding the contract that gave rise to the claim.
[23]
The fact
that the services rendered by the respondent were not [translation] “supplied to a ship for its operation or
maintenance” (Appellant’s Memorandum, paragraph 37) does not affect the
analysis. Such services are undeniably of a maritime nature, but so
too is the service through which the acquisition of a vessel is made possible
in the case at bar. The problem identified by
the parties to the contract is incontestably “integrally connected to maritime
matters” (Monk, page 795), as is the respondent’s claim to its due
for having provided a solution to this problem. This
is the perspective from which the claim must be considered.
[24]
The Federal
Court’s decision in Prince Nova does not support the appellant’s
argument. That case involved determining, in the context of a motion
for dismissal, whether an action in damages filed for the breach of a contract
governing the sale of a vessel, whose provisions were in dispute, was subject
to the Federal Court’s jurisdiction in maritime matters. In the course of his analysis, Justice MacKay suggested
that the ultimate decision on that issue might be different depending on
whether the contract at issue was a contract of sale or a brokerage agreement (Prince
Nova, paragraph 19). He concluded
this aspect of his analysis as follows (idem, paragraph 22):
If it is found there is no contract between the parties, or that the
agreement between them is other than one to sell the ship to the plaintiffs,
for example, a mere brokerage agreement to assist in sale of the ship for a
commission, the agreement may, or may not, be found to lie within the Court’s
maritime jurisdiction. That issue awaits determination by the trial judge,
if this matter should go to trial.
[Emphasis added]
The trial, it seems, was never held.
[25]
Finally, the Federal
Court’s conclusion in John Canning is that the claim at issue in that
case, that is, damages for unlawful termination of a contract for the sale of
pulp and paper, was unconnected to the maritime aspects of the contract (John
Canning, paragraph 20). This conclusion is consistent with the
principle established in Monk but has nothing to do with this case, as
the basis for the claim is eminently maritime.
[26]
I would dismiss the appeal
with costs.
“Marc Noël”
“I agree.
Johanne Trudel, J.A.”
“I agree.
Robert M.
Mainville J.A.”
Certified true
translation
Sarah Burns
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