Date: 20060327
Docket: T-1915-05
Citation: 2006 FC 388
Vancouver, British Columbia, March 27th, 2006
PRESENT: Roger R. Lafrenière, Esquire
Prothonotary
ADMIRALTY ACTION IN REM AGAINST THE VESSEL "GREAT PRIDE"
AND IN PERSONAM
SIMPLIED ACTION
BETWEEN:
SUMISHO REFTECH CO., LTD.
Plaintiff
and
THE OWNERS AND ALL OTHERS INTERESTED IN THE SHIP
"GREAT PRIDE", THE SHIP "GREAT PRIDE",
GRAND ATLANTIC SHIPPING PTE. LTD.
and COSCO CONTAINER LINE CO., LTD.
Defendants
REASONS FOR ORDER AND ORDER
[1] This simplified action arises out of a claim by the Plaintiff, Sumisho Reftech Co., Ltd. (Sumisho) for the carriage of goods, which is time barred in both China and Japan. The Defendant, Cosco Container Lines Company Limited (Cosco), seeks a stay of proceedings on the grounds that there is no connection between the Sumisho's claim for damages and Canada.
Facts
[2] There is no dispute on this motion about who the parties are, which witnesses would be called at trial, or what law governs the dispute.
[3] Sumisho is a Japanese company. Cosco is a Chinese company with a head office in Shanghai that owns or controls a subsidiary company in Canada named China Ocean Shipping (Canada) Inc. (China Ocean). The ship owner, Grand Atlantic Shipping Pte Ltd., appears to be a Vietnamese company.
[4] The carriage of goods at issue in the statement of claim was from China to Japan. Witnesses with respect to the loading of the cargo will be in China. Witnesses as to discharge of the goods, including a Japanese surveyor, will be in Japan. There are no witnesses in Canada.
[5] The carriage contract evidenced by the Cosco's bill of lading makes Chinese law the governing law of the contract.
Analysis
[6] That this Court has jurisdiction to entertain Sumisho's action is properly conceded by Cosco. Section 46 of the Marine Liability Act, S.C., 2001, c. 6, provides that "a claimant may institute judicial or arbitral proceedings in a court or arbitral tribunal in Canada that would be competent to determine the claim if the contract had referred the claim to Canada, where...(b) the person against whom the claim is made resides or has a place of business, branch or agency in Canada." The mere presence of a subsidiary of Cosco in Canada, therefore, is sufficient to give this court jurisdiction simpliciter: see Magic Sportswear Corp. v. Mathilde Maersk (The), [2005] 2 F.C.R. 236 (F.C.); Ford Aquitaine Industries SAS v. Canmar Pride (The), [2005] 4 F.C.R. 441 (F.C.). At issue is whether this Court should nonetheless decline to exercise its jurisdiction by staying the action.
[7] Section 46(1) of the Marine Liability Act prevents this Court from staying proceedings where the requirements of s. 46(1)(a), (b) or (c) have been met and the sole basis for the stay is a forum selection clause. However, the Court retains discretion under subsection 50(1)(b) of the Federal Courts Act to stay proceedings where Canada is not the convenient forum for the claim.
[8] The leading case on forum conveniens principles is the Supreme Court of Canada decision in Amchem Products Inc. v. B.C. (Workers' Compensation Board), [1993] 1 S.C.R. 897, which in turn applies a decision of the House of Lords in The "Spiliada", [1987] 1 Lloyds' Rep. 1 (H.L.). These authorities clarify that the discretion to stay proceedings should be exercised where there is a clearly more appropriate forum for the claim. The principles are based in comity between nations, to avoid multiple actions in different jurisdictions, and are designed to curb "forum shopping".
[9] On the evidence before me, it is clear that there is no connection between Sumisho's claim and Canada. Rather, all factors in the claim point to either China or Japan as being the natural forum for this claim. China is where the goods were loaded and whose laws govern the claim, while Japan is where the goods were discharged and where witnesses as to the condition of the goods are located.
[10] Sumisho submits that it instituted this action because it perceived some juridical or other advantages in Canada that are not available in Japan or China. It provided examples of disadvantages in the legal system in China, such as stringent requirements for authenticating evidence, and the requirement to translate documents into Chinese. As for Japan, Sumisho is concerned that the Japanese Court would uphold the jurisdiction clause in the bill of lading and stay the proceedings in favour of China.
[11] I am not satisfied that the procedural disadvantages identified by Sumisho would result in any unfairness, or that they outweigh the real and substantial connection of this matter to China or Japan. They certainly do not constitute sufficient grounds to refuse a stay. Differences in legal systems and procedure are to be respected provided substantial justice will be done: see The "Spiliada", above, at page 14:
The key to the solution of this problem lies, in my judgment, in the underlying fundamental principle. We have to consider where the case may be tried "suitably for the interests of all the parties and for the ends of justice." Let me consider the application of that principle in relation to advantages which the Plaintiff may derive from invoking the English jurisdiction. Typical examples are: damages awarded on a higher scale; a more complete procedure of discovery; a power to award interest; a more generous limitation period. Now, as a general rule, I do not think that the court should be deterred from granting a stay of proceedings, or from exercising its discretion against granting leave under R.S.C. Ord. 11, simply because the Plaintiff will be deprived of such an advantage, provided that the court is satisfied that substantial justice will be done in the available appropriate forum. Take, for example, discovery. We know that there is a spectrum of systems of discovery applicable in various jurisdictions, ranging from limited discovery available in civil law countries on the continent of Europe to the very generous pre-trial oral discovery procedure applicable in the United States of America. Our procedure lies somewhere in the middle of this spectrum. No doubt each of these systems has its virtues and vices; but, generally speaking, I cannot see that, objectively, injustice can be said to have been done if a party is, in effect, compelled to accept one of these well-recognised systems applicable in the appropriate forum overseas.
[12] Sumisho acknowledges that its claim has no real or substantial connection to Canada. It therefore does not vigorously oppose a stay of proceedings, provided that Cosco will consent to Japanese jurisdiction, that Cosco will undertake to waive any time bar defence and, in addition, that the Japanese Court accepts jurisdiction and the Cosco's waiver. Cosco has offered a waiver of reliance on the time-bar, but takes issue with the remaining conditions.
[13] I conclude that astay should be granted subject only to Cosco's waiver of any time-bar. It would not be appropriate to impose on the Cosco the requirement to consent to Japanese jurisdiction when it is unclear whether Japan is the appropriate forum to litigate Sumisho's claim. The Plaintiff will have to return to this Court to establish that it would be in the interests of justice to lift the stay in the event the Japanese Court declines jurisdiction.
ORDER
THIS COURT ORDERS that:
1. These proceedings are stayed.
2. This stay of proceedings is granted on the condition that the Defendant, Cosco Container Lines Co. Ltd., waives the applicable time-bar in Japan or China.
3. The Defendant, Cosco Container Lines Co. Ltd., is awarded its costs of this motion from the Plaintiff, hereby fixed at $750.00, plus reasonable disbursements, to be paid forthwith.
"Roger R. Lafrenière"
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