Mosregion Investments Corporation et al. v. Ukraine International Airlines et al.
[Indexed as: Mosregion Investments Corp. v. Ukraine International Airlines]
103 O.R. (3d) 315
2010 ONCA 715
Court of Appeal for Ontario,
Sharpe, Blair and Rouleau JJ.A.
October 28, 2010
Limitation of actions -- International law -- Article 29 of Warsaw Convention providing that right to damages shall be "extinguished" if action is not brought within two years -- Plaintiffs issuing notice of claim against defendant within two years but not serving claim on defendant within six-month period provided by Rules of Civil Procedure -- Master not erring in granting extension of time nunc pro tunc -- Article 29 of Convention satisfied once claim is issued within two-year limitation period -- Claim then governed by Rules -- Claim not a nullity under Rules because it was not served within six months -- Nunc pro tunc extension of time for service not amounting to bringing of new claim -- Convention for the Unification of Certain Rules Relating to International Carriage by Air, 12 October 1929, 137 L.N.T.S. 11, art. 29 -- Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
The plaintiffs issued a notice of action against the defendant within the two-year limitation period set out in art. 29 of the Convention for the Unification of Certain Rules Relating to International Carriage by Air. The claim was not served on the defendant within the six-month period provided by the Rules of Civil Procedure. The plaintiffs brought a motion for an order extending the time for service. The motion was granted, and that decision was affirmed by the Divisional Court. The defendant appealed, relying on the fact that art. 29 of the Convention states that the right to damages shall be "extinguished" if an action is not brought within two years.
Held, the appeal should be dismissed. [page316]
Once a claim is issued within the two-year limitation period, art. 29 of the Convention has been satisfied, and the claim falls to be governed by the procedure in the jurisdiction where the claim has been issued. Under the Rules of Civil Procedure, an issued claim that is not served within the time frame provided by the Rules does not become a nullity. The nunc pro tunc extension of time for service did not amount to the bringing of a new claim.
APPEAL from the judgment of J. Wilson J. (2009), 2009 CanLII 63600 (ON SCDC), 99 O.R. (3d) 49, [2009] O.J. No. 4857 (Div. Ct.) affirming an order extending the time for service of claim.
Cases referred to Brown v. Humble, 1959 CanLII 174 (ON CA), [1959] O.R. 586, [1959] O.J. No. 696, 21 D.L.R. (2d) 38 (C.A.), consd Other cases referred to Mosregion Investments Corp. v. Ukraine International Airlines, [2009] O.J. No. 1457, 176 A.C.W.S. (3d) 338 (S.C.J.); Sheldon v. Brown Bayley's Steel Works Ltd., [1953] 2 Q.B. 393, [1953] 2 All E.R. 894, [1953] 3 W.L.R. 542 (C.A.) Statutes referred to Carriage by Air Act, R.S.C. 1985, c. C-26 [as am.] Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 3.02 Treaties and conventions referred to Convention for the Unification of Certain Rules Relating to International Carriage by Air, October 12, 1929, 137 L.N.T.S. 11, arts. 28, para. 2, 29
Gerard Chouest and Tae Mee Park, for appellant Ukraine International Airlines. Ernest H. Toomath and Courtney Toomath-West, for respondents.
[1] BY THE COURT: -- This appeal concerns the interpretation of the Carriage by Air Act, R.S.C. 1985, c. C-26 implementing the Convention for the Unification of Certain Rules Relating to International Carriage by Air, October 12, 1929, 137 L.N.T.S. 11 (the "Warsaw Convention"), which regulates liability for the international carriage of persons and property by air. The text of the Warsaw Convention is in French. Article 29 of the Warsaw Convention provides that an action "doit être intentée" (meaning "must be brought") within two years.
[2] Articles 28 and 29 of the Warsaw Convention read as follows: Article 28
L'action en responsabilité devra être portée, au choix du demandeur, dans le territoire d'une des Hautes Parties Contractantes . . .
La procédure sera réglée par la loi du tribunal saisi. [page317] Article 29
L'action en responsabilité doit être intentée, sous peine de déchéance, dans le délai de deux ans à compter de l'arrivée à destination ou du jour où l'aéronef aurait dû arriver, ou de l'arrêt du transport.
Le mode du calcul du délai est déterminé par la loi du tribunal saisi.
[3] The English text of arts. 28 and 29, as implemented in the Carriage by Air Act, reads as follows: Article 28
An action for damages must be brought, at the option of the plaintiff, in the territory of one of the High Contracting Parties . . .
Questions of procedure shall be governed by the law of the Court seised of the case. Article 29
The right to damages shall be extinguished if an action is not brought within two years, reckoned from the date of arrival at the destination, or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped.
The method of calculating the period of limitation shall be determined by the law of the Court seised of the case.
[4] In this case, the respondents issued a notice of action against the appellant, Ukraine International Airlines, and others regarding the destruction of documents contained in an Air France jet that overran the runway and caught fire at Pearson International Airport. The notice of action was issued within the two-year limitation period. However, the respondents were not successful in serving the claim on the appellant within the six-month period provided in Ontario's Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
[5] The respondents brought an ex parte motion before Master Sproat for an order extending the time for service. Master Sproat adjourned the motion for notice to be served on the appellant and the other defendants who had not yet been served. The motion later returned for hearing before Master Hawkins, who granted the extension of time nunc pro tunc. The appellant did not appear on the motions. The master's decision to extend time was consistent with this court's decision in Brown v. Humble, 1959 CanLII 174 (ON CA), [1959] O.R. 586, [1959] O.J. No. 696 (C.A.). The appellant brought a motion for reconsideration before Master Dash. The basis of the motion was that notice was never received by the appellant or, in the alternative, that the appellant failed to attend through mistake or insufficient notice. Master Dash confirmed the decision [[2009] O.J. No. 1457, 176 A.C.W.S. (3d) 338 (S.C.J.)], [page318] and a further appeal to the Divisional Court was dismissed.
[6] In the court below, the primary issue was whether the respondents had "brought" the action when the statement of claim was issued or only when service of the claim was effected. The appellant now concedes that the action was brought upon issuance of the claim and that this occurred within the two-year limitation period.
[7] In this court, the issue is presented somewhat differently. The appellant argues that the extension of time was improper because the statement of claim had expired due to the failure to effect service before the extension was obtained and that given the language of art. 29, the claim had expired and could not be revived.
[8] The appellant submits that the rule in Brown v. Humble has no application to a claim brought under the Warsaw Convention. Brown v. Humble dealt with a statutory limitation period. In common law jurisdictions, the expiry of a statutory limitation period does not extinguish the underlying claim, but rather creates a procedural bar to proceeding with the claim. The appellant submits that the two-year period laid down by art. 29 has a fundamentally different character and that after two years, the claim is extinguished. It follows, in the appellant's submission, that when the statement of claim expired for want of service after the two-year prescription in art. 29 had expired, the Warsaw Convention claim was extinguished and there was nothing to revive.
[9] We disagree. In our view, once a claim is issued within the two-year limitation period, art. 29 of the Warsaw Convention has been satisfied and the claim then falls to be governed by the procedure in the jurisdiction where the claim has been issued. Any subsequent procedural requirements, including those relating to the time for service or renewal of the statement of claim, are governed by the Rules. This is apparent from art. 28, para. 2 of the Warsaw Convention, which specifically provides that the procedure of the court seized of the claim governs. Indeed, the very requirement that service must be effected within six months is provided for by the Ontario Rules, not by the terms of the Warsaw Convention.
[10] Rule 3.02 of the Rules allows for the extension of time for service if the motion is brought either before or after the time for service has expired. This court's decision in Brown v. Humble is part of the jurisprudence governing the procedure for granting extensions to claims issued in Ontario. From this decision, it is apparent that an issued claim that is not served [page319] within the time frame provided in the Rules does not become a nullity. In Brown v. Humble, the court adopted the reasoning of the English Court of Appeal in Sheldon v. Brown Bayley's Steel Works Ltd., [1953] 2 Q.B. 393, [1953] 2 All E.R. 894 (C.A.). In that case, Denning L.J. held, at p. 897 All E.R., that, "if a writ can be renewed after 12 months have expired that must mean that it is not then a nullity". Similarly, Singleton L.J. commented, at p. 896 All E.R.:
I do not regard it as strictly accurate to describe a writ which has not been served within 12 months as a nullity. It is not as though it had never been issued. It is something that can be renewed. A nullity cannot be renewed.
[11] Applying the Rules of Civil Procedure and this court's decision in Brown v. Humble does not violate any of the provisions of the Warsaw Convention -- once the respondents complied with the requirement in art. 29 that a claim be issued within the two-year period, they brought themselves within Ontario's Rules. Pursuant to those Rules and the jurisprudence governing them, the nunc pro tunc extension to the time for service did not amount to the bringing of a new claim; the claim had already been "intentée" and the time for service of the existing claim was extended in accordance with Ontario procedure. Accordingly, we see no error in the master's application of the Ontario Rules, as interpreted by decisions of this court.
[12] As a result, the appeal is dismissed. The respondents are entitled to costs. With respect to the quantum of costs, we agree with the appellant's submission that a reduction in the amount sought should be made to take into account the fact that the motion for fresh evidence was unnecessary. Costs to the respondents fixed at $15,000, inclusive of disbursements and applicable taxes.
Appeal dismissed.