Desgagnés Transport v Wärtsilä Canada: Canadian Maritime Law Enters Uncharted Waters

The Supreme Court of Canada has plotted a new course for Canadian maritime law in Desgagnés Transport v Wärtsilä Canada, 2019 SCC 58. Distinguishing over 30 years of precedent, the Court held that provincial legislation that regulates private law matters (such as the Civil Code of Québec, or sales of goods legislation in common law provinces) can apply to contractual claims governed by Canadian maritime law. Parties to such contracts can no longer rely on the uniformity of Canadian maritime law; they will instead need to take particular care to ascertain and specify which province's private law will govern any claims that may arrive.

Background

Wärtsilä manufactured a component for a cargo vessel owned by Desgagnés Transport. The contract of sale included a limitation of liability clause, which was the subject of considerable negotiation. Over two years later, the component failed on the open water, causing considerable damage to the vessel. Desgagnés Transport's insurer repudiated the limitation of liability clause and sued to recover the full amount of the damage, which greatly exceeded the value of the component...