DATE: 20060407 DOCKET: M33625 (C43898)

COURT OF APPEAL FOR ONTARIO

RE:

OAKWELL ENGINEERING LIMITED (Applicant/Respondent in Appeal) and ENERNORTH INDUSTRIES INC. (Formerly known as Energy Power Systems Limited, Engineering Power Systems Group Inc. and Engineering Power Systems Limited respectively (Respondent/Appellant)

BEFORE:

McMURTRY C.J.O.

COUNSEL:

Richard Gibbs, Q.C.

for the Moving Party/Intervenor, Lawyers Rights Watch Canada

David R. Wingfield

for the Respondent/Appellant in Appeal, Enernorth Industries Inc.

Matthew Milne Smith For the Respondent/Respondents in Appeal, Oakwell Engineering Limited

HEARD:

March 28, 2006

ENDORSEMENT

[1] Lawyers Rights Watch Canada (“LRWC”) brought a motion on March 28, 2006 seeking to intervene in this matter as a friend of the court. The appeal is scheduled for a full-day hearing on April 10, 2006 and therefore this application was brought extremely late in the proceedings. The proposed intervenor sought to file a factum of 30 pages and requested one hour for oral argument. That “time” request and the nature of the arguments to be made could well have necessitated an adjournment of the proceedings. The appellant, Enernorth Industries Inc. (“Enernorth”), supported the intervention request and an adjournment, if necessary. The respondent, Oakwell Engineering Ltd. (“Oakwell”), opposed the intervention and any adjournment, although it reserved the right to request an adjournment and file fresh evidence should leave to intervene be granted to LRWC. On March 28, counsel were advised that I had dismissed the motion, with reasons to follow. These are those reasons.

[2] LRWC is a committee of Canadian lawyers who promote human rights and the rule of law by providing support internationally to human rights defenders in danger. Its primary focus is protecting lawyers whose freedoms and independence are threatened as result of their human rights advocacy.

[3] This appeal is not related to the defence of human rights lawyers as it is a commercial case. The issue in this appeal is whether a Canadian court should recognize a civil judgment rendered by the Superior Court of Singapore (and confirmed on appeal there). LRWC has taken up the cause of several human rights advocates in Singapore and submits that the legal system of Singapore is generally corrupt. The proposed intervenor has demonstrated no particular expertise in the law of Singapore but does not seek to assist the court in relation to that law. Rather it wishes to argue that the courts of Canada are bound by a constitutional imperative to refuse to enforce judgments emanating from any corrupt legal system.

[4] Enernorth, a Canadian company entered into an agreement with Oakwell, a Singapore company to build mobile power stations in India. In order for the project to be completed, certain steps had to be taken by the government of India and the particular state in which the power stations were to be built. After the project was commenced, the parties ran into difficulties, including the obtaining of required approvals and commitments from the two levels of Indian government. Ultimately, the parties decided to part ways. Litigation was commenced and later was settled. Pursuant to the settlement Enernorth purchased the interests of Oakwell in the project with an agreement for future payment of royalties to Oakwell on the completion of the project. The parties further agreed that the law and courts of Singapore would govern any disputes that might arise under the settlement. Thereafter, Enernorth carried the project forward but the Indian governments dramatically altered their requirements and Enernorth sold its interests in the project to an Indian company. Oakwell sued in Singapore for payment of royalties or sums in lieu of royalties. Enernorth defended on the basis that there were no monies owing by it to Oakwell as the acts of the Indian governments had the effect of frustrating the settlement agreement. After a trial that lasted some thirteen days, the court issued a lengthy judgment in favour of Oakwell. An appeal to the Singapore Court of Appeal was dismissed.

[5] Oakwell brought an application before Justice Day in the Superior Court of Ontario seeking to enforce its judgment. Enernorth defended on the basis that Ontario courts should not enforce judgments of Singapore because those courts are systemically corrupt. It led evidence that commercial disputes were inevitably determined in favour of those who were “connected to” the ruling oligarchy. Oakwell argued before Day J. that the Singaporean justice system did not respect the rule of law and accordingly its judgments should not be recognized by our courts.

[6] Oakwell responded that the government and courts of Singapore were institutionally patterned after those of Great Britain and similar to those of Canada. It further responded that there was no evidence of any impropriety in the particular case before the court involving Oakwell and Enernorth. It submitted that both parties were given a fair hearing and furthermore that, Enernorth adopted the Singaporean legal system by counter suing for some $175 million. It also argued that Enernorth had raised no issue of impropriety or bias at trial or on appeal in Singapore. It did so for the first time in defending the application before Justice Day.

[7] Justice Day found that the evidence before him did not support any inference of corruption or bias (actual or apprehended) on the part of the trial judge.

[8] The proceedings before Justice Day consumed some four days. I was advised that the record comprised of at least 15 volumes of material. The factums filed on the application are extensive and comprehensive. The appellant’s factum, which deals with the evidence and issues raised on the application and on the appeal, amounts to a “full frontal attack” on the legal system of Singapore. It is clear to me, on the basis of the material filed on this motion, that the attack on the alleged systemic deficiencies of the Singaporean legal system forms a significant element of the appellant’s argument before this court. Leave to intervene as a friend of the court may be granted when, on consideration of the nature of the case and the issues that arise, the court is satisfied that the proposed intervenor is able to make a useful contribution to the resolution of the appeal without causing any injustice to the immediate parties. See Peel (Regional Municipality) v. Great Atlantic and Pacific Co. of Canada Ltd. (1990), 74 O.R. (2d) 164, 45 C.P.C. (2d) 1 (C.A.).

[9] A friend of the court need not be “impartial”, “objective” or “disinterested” in the outcome of the case and this court has recognized the valid contributions to be in made in appropriate cases by classes of intervenors who may advocate a particular interpretation of the law. Such contributions may assist the court in its analysis of the issues for determination by placing them under scrutiny through a different lens or from a different perspective. The fact that the position of a proposed intervenor is generally aligned with the position of one of the parties is not a bar to intervention if the intervenor can make a useful contribution to the analysis to of the issues before the court. See Childs v. Desormeaux (2003), 67 O.R. (3d) 385 (C.A.); Halpern v. Toronto (City) Clerk (2000), 51 O.R.(3d) 742.

[10] Ontario courts, however, are more reluctant to permit intervention when the underlying litigation is essentially private in nature. In Authorson (Litigation Guardian of) v. Canada (Attorney General) (2001), 147 O.A.C. 355, 9 C.P.C. (5th) 218 (C.A.), at paragraphs 8 and 9, I pointed out:

Intervention of third parties into essentially private disputes should be carefully considered as any intervention can add to the costs and complexity of the litigation, regardless of an agreement to restrict submissions.

Many appeals will fall somewhere in between the constitutional and strictly private litigation continuum, depending on the nature of the case and the issues to be adjudicated. In my view, the burden on the moving party should be a heavier one in cases that are closer to the “private dispute” end of the spectrum.

[11] In Stadium Corp. of Ontario Ltd. v. Toronto (City) (1992), 10 O.R. (3d) 203 (Div. Ct.), Archie Campbell J. stated at page 208:

Proposed intervenors must be able to offer something more than the repetition of another party’s evidence and argument or a slightly different emphasis on arguments squarely [made] by the parties. The fact that the intervenors are prepared to make a somewhat more sweeping constitutional argument does not mean they will be able to add or contribute to the resolution of the legal issues between the parties.

[12] I am not satisfied that the proposed submissions of LRWC will bring anything new to the resolution of the issues under appeal. In my view it would provide largely a repetition of the submissions of Enernorth. The fact that it may bring a “somewhat more sweeping constitutional argument” than that made by Enernorth on the point will not particularly assist the resolution of the essential issue before our court.

[13] I should like to comment further upon two other matters. As stated earlier, this appeal is scheduled for hearing on April 10, 2006 and the motion brought by the proposed intervenor was filed only on March 20, 2006 and came on for hearing on March 28, barely two weeks before the scheduled hearing. The proposed intervenor did not seek to intervene on the application before Justice Day, which came on for hearing in late 2004. The decision, delivered in August 2005, was published on the Internet and in legal reports. The appeal has been in this court since the summer of 2005 and has been scheduled for hearing for several months. The only explanation given by the moving party for not seeking to intervene at an earlier date is that the appeal had not come to its attention until recently. In my view, any application for intervention should be made in a much more timely way. Only in exceptional circumstances would an intervention, bringing more extensive arguments, be permitted so close to the hearing date of an appeal when the parties have already delivered their factums and would have little time to properly prepare for and respond to any new arguments.

[14] There is a further issue that is also of considerable concern to me. The proposed intervenor filed an affidavit of a director of LRWC, in support of its application. The affidavit sets out the “rule of law” emphasis placed on the matter by the proposed intervenor, suggests that such issues were not fully addressed by the parties themselves and comments negatively on the decision of Justice Day. When Oakwell advised that it wished to cross-examine the director on his affidavit pursuant to the provisions of the Rules of Civil Procedure, counsel for LRWC responded that the request “to cross-examine Mr. Rubin is an affront to him and to LRWC”. Nevertheless, Oakwell took out an appointment for the cross-examination of the director who failed to attend. Oakwell submitted that the director’s affidavit should be struck for his failure to adhere to the Rules of Civil Procedure and that this would be a sufficient ground to dismiss the intervention motion.

[15] A party that refuses, contrary to the Rules of Civil Procedure, to produce the deponent of an affidavit for cross-examination does so at considerable risk. In this case, the moving party acted improperly in taking the position that the proposed cross-examination was an “affront” to the deponent and to the proposed intervenor. I would think that it would be a most exceptional case where a motion would be granted where the deponent of the sole affidavit in support of the motion refused to present him or herself for cross-examination pursuant to a reasonable and lawful request from opposing counsel.

[16] In conclusion, I am not satisfied that the Lawyers Rights Watch Canada has met the test for intervention as a friend of the court in this case and the application is therefore dismissed.

“R. Roy McMurtry C.J.O.”