Ontario Court Finds Jurisdiction Resulting From Cumulative Effect of Individually Insufficient Connecting Factors

Andrew Ottaway, B.A. (Hons.), LL.B.Business Litigation, Civil Litigation, Commercial Contracts, Commercial Litigation, Contract Disputes, Contract Termination, Cross-Border Litigation, Forum Challenges, International Sale of Goods, Jurisdictional Challenges0 Comments

In Freshway Services Inc. v. CdEnviro Ltd., 2017 ONSC 6591, the plaintiff Ontario company contracted with the defendant Northern Irish company.  The defendant was to build a waste recycling facility and install it at the plaintiff’s facility in Ontario.  A third party to provide warranty coverage and servicing for components of the waste recycling plant, once it was built and delivered to Ontario.  A dispute arose between the parties, and the plaintiff sued the defendant in Ontario.  The defendant brought a motion to stay the Ontario action on the basis that Ontario lacked jurisdiction.

The motion judge considered the the presumptive connecting factors for jurisdiction set out by the Supreme Court in Club Resorts Ltd. v Van Breda, 2012 SCC 17, being whether the contract was made in the Ontario: whether the defendant was carrying on actual business in Ontario; whether the defendant is resident in Ontario; or where the incidents that form the basis of the action took place in Ontario.  The motion judge found that the contract was made in Northern Ireland; that the the majority of the design functions relating to the facility took place in Northern Ireland; and the defendant was not domiciled in Ontario.

However, the motion judge stated that a number of factors, while individually insufficient, cumulatively established a real and substantial connection to Ontario, being (1) the defendant made several business trips and conducted meetings in Ontario for the subject contract and another, prior deal; (2) the contractual warranty coverage was to be provided in Ontario by a business partner of the defendant; (3) spare parts for the facility were to be stored in Ontario; (4) the Ontario plaintiff contributed to the design of the subject equipment; and (5) the equipment was to be installed and operated in Ontario.  

The lawyers at Gilbertson Davis LLP have experience with cross-border disputes, including breach of contract claims.  Further, the lawyers at Gilbertson Davis LLP have brought and defended against jurisdiction challenges.  Please contact us for an initial consultation.

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About the Author
Andrew Ottaway, B.A. (Hons.), LL.B.

Andrew Ottaway, B.A. (Hons.), LL.B.

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