Ontario Court Weighs In On Assuming Jurisdiction Over Tort Claims Against Foreign Defendants

• Law Firm: Borden Ladner Gervais LLP
• Subject Matter: Corporate/Commercial Law, Litigation, Mediation & Arbitration, Contracts and Commercial Law, Court Procedure
• Author: Mr Robert Love, David Elman and Aidan Fishman
• Published date: 24 March 2023

On March 2, 2023, the Court of Appeal for Ontario released its decision in Sinclair v Amex Canada Inc., 2023 ONCA 142, grappling with the application of the test for determining whether a Canadian court should assume jurisdiction over an out-of-province defendant (Van Breda test). Specifically, the Court examined the extent to which a contract made in Ontario with one defendant might extend an Ontario court's jurisdiction over other defendants that were not parties to the contract, although providing services that were tangentially related.

While the court unanimously agreed that the Ontario court did not have jurisdiction, the existence of concurring reasons suggests that the application of the Van Breda test may continue to be the subject of judicial debate.

Background

The action arose out of an accident on July 25, 2017 in Venice, Italy. The plaintiffs are two Ontario residents who travelled to Europe to celebrate their son's high school graduation. They were injured when a water taxi hired to take them from the airport to their hotel was involved in a collision.

The plaintiffs sued Amex Canada Inc., which operates the travel service through which they had arranged their trip. They also sued the Italian water taxi driver, as well as four Italian companies that had been contacted by Amex or its subsidiaries in order to provide transportation services for the plaintiffs. While the statement of claim pleaded the existence of the contract between the plaintiffs and Amex, the claim was framed in negligence, rather than breach of contract.

The motion decision

Amex did not quarrel with being subject to the jurisdiction of the Ontario court given its connections to the province. However, three of the four Italian companies brought a motion to dismiss or stay the action as against them on the basis that the Ontario Superior Court of Justice lacked jurisdiction over them. The Motion Judge dismissed this motion, finding that, pursuant to the Supreme Court's seminal decision in Club Resorts Ltd. v Van Breda, 2012 SCC 17, the plaintiffs had satisfied the fourth presumptive connecting factor, namely that a contract connected with the dispute had been made in Ontario.

The appellate decision

The court unanimously granted the Italian companies' appeal, staying the action as against them on the basis of lack of jurisdiction. However, two sets of reasons emerged, granting this relief on different bases.

The majority judgment of Justices Nordheimer and Tulloch rejected the...