Trillium Motor World Ltd. v. General Motors of Canada Limited et al.; Lapointe Rosenstein Marchand Melançon SENCRL et al., Third Parties

[Indexed as: Trillium Motor World Ltd. v. General Motors of Canada Ltd.]

Ontario Reports

Court of Appeal for Ontario,

Doherty, LaForme and Lauwers JJ.A.

June 27, 2014

120 O.R. (3d) 598 | 2014 ONCA 497

Case Summary

Conflict of laws — Forum conveniens — GM offering compensation to terminated dealers on terms set out in wind-down agreements ("WDAs") — WDAs requiring dealers to obtain independent legal advice — Plaintiff bringing class action in Ontario on behalf of terminated dealers against GM and CB — Claim against CB alleging that CB was negligent while acting as legal counsel for dealers in failing to appropriately advise them about protections available under provincial franchise law — CB bringing third party claim against lawyers who signed certificates of independent legal advice claiming that it was retained by Canadian Automobile Dealers' Association and not by individual dealers and seeking contribution and indemnity if it was found to have been retained by dealers and to have been negligent — Out-of-province third parties moving unsuccessfully to stay or dismiss third party claim — Motion judge not erring in refusing to decline jurisdiction over third party action on basis of forum non conveniens. [page599]

Conflict of laws — Jurisdiction — GM offering compensation to terminated dealers on terms set out in wind-down agreements ("WDAs") — WDAs requiring dealers to obtain independent legal advice — Plaintiff bringing class action in Ontario on behalf of terminated dealers against GM and CB — Claim against CB alleging that CB was negligent while acting as legal counsel for dealers in failing to appropriately advise them about protections available under provincial franchise law — CB bringing third party claim against lawyers who signed certificates of independent legal advice claiming that it was retained by Canadian Automobile Dealers' Association and not by individual dealers and seeking contribution and indemnity if it was found to have been retained by dealers and to have been negligent — Out-of-province third parties moving unsuccessfully to stay or dismiss third party claim — Motion judge not erring in finding that Ontario court had jurisdiction — Presumptive connecting factor existing as WDA was contract connected with dispute which was made in Ontario.

The defendant GM terminated over 200 dealerships across Canada and offered compensation to terminated dealers on terms set out in wind-down agreements ("WDAs"). The WDAs provided that the agreement was governed by the laws of Ontario, that Ontario courts had exclusive jurisdiction to hear and determine claims between the parties pertaining to the agreement, that signing dealers waived their rights under provincial franchise laws, and that each dealer would obtain a certificate of independent legal advice. The plaintiff commenced a class action in Ontario on behalf of terminated dealers against GM and the defendant CB, alleging that GM forced dealers to sign the WDAs in breach of provincial franchise law and that CM, while acting as legal counsel for the dealers, was negligent in failing to provide appropriate advice about the protections available under provincial franchise law and had an undisclosed conflict of interest. CB issued a third party claim against lawyers who had signed the certificates of independent legal advice. It asserted that it was retained by the Canadian Automobile Dealers' Association, and not by the individual dealers, and sought contribution from the third party law firms in the event that it was found to have been retained by the individual dealers and to have been negligent. The third party law firms which were located in the province of Quebec brought a motion for an order dismissing or staying the third party claim. The motion was dismissed. The third parties appealed.

Held, the appeal should be dismissed.

The motion judge did not err in finding that the Ontario court had jurisdiction to hear the third party claims. A presumptive connecting factor existed as a contract connected with the dispute -- the WDA -- was made in Ontario. As found by the motion judge, it was reasonable for the out-of-province lawyers to be called upon to defend Ontario proceedings challenging their advice, since they had advised on the content of the WDA, which expressly provided both that it was governed by Ontario law and that all disputes about it would be litigated in Ontario.

The motion judge did not err in refusing to decline jurisdiction over the third party actions on the basis of forum non conveniens. The case management judge had discretion to structure the resolution of the third party actions in an efficient and expeditious way -- for example, by way of test cases -- to avoid the inefficiencies and costs cited by the appellants. [page600]

Club Resorts Ltd. v. Van Breda, [2012] 1 S.C.R. 572, [2012] S.C.J. No. 17, 2012 SCC 17, 291 O.A.C. 201, 2012EXP1452, J.E. 2012-788, EYB 2012-205198, 429 N.R. 217, 343 D.L.R. (4th) 577, 91 C.C.L.T. (3d) 1, 10 R.F.L. (7th) 1, 17 C.P.C. (7th) 223, 212 A.C.W.S. (3d) 712, affg (2010), 98 O.R. (3d) 721, [2010] O.J. No. 402, 2010 ONCA 84, 264 O.A.C. 1, 316 D.L.R. (4th) 201, 81 C.P.C. (6th) 219, 71 C.C.L.T. (3d) 161, 77 R.F.L. (6th) 1, 185 A.C.W.S. (3d) 68, apld

Export Packers Co. v. SPI International Transportation, [2012] O.J. No. 3126, 2012 ONCA 481, 294 O.A.C. 319, distd

Other cases referred to

Breeden v. Black, [2012] 1 S.C.R. 666, [2012] S.C.J. No. 19, 2012 SCC 19, 291 O.A.C. 311, 2012EXP-1450, J.E. 2012-786, 429 N.R. 192, EYB 2012-205200, 17 C.P.C. (7th) 1, 343 D.L.R. (4th) 629, 91 C.C.L.T. (3d) 153, 212 A.C.W.S. (3d) 713; Carom v. Bre-X Minerals Ltd. (1999), 1999 CanLII 14781 (ON SC), 43 O.R. (3d) 441, [1999] O.J. No. 281, 99 O.T.C. 335, 30 C.P.C. (4th) 133, 86 A.C.W.S. (3d) 32 (Gen. Div.); Christmas v. Fort McKay First Nation (2014), 119 O.R. (3d) 21, [2014] O.J. No. 390, 2014 ONSC 373, 14 C.C.E.L. (4th) 159, 236 A.C.W.S. (3d) 900 (S.C.J.); Eastern Power Ltd. v. Azienda Communale Energia and Ambiente, 1999 CanLII 3785 (ON CA), [1999] O.J. No. 3275, 178 D.L.R. (4th) 409, 125 O.A.C. 54, 50 B.L.R. (2d) 33, 39 C.P.C. (4th) 160, 90 A.C.W.S. (3d) 862 (C.A.) [Leave to appeal to S.C.C. refused [1999] S.C.C.A. No. 542]; Inukshuk Wireless Partnership v. 4253311 Canada Inc. (2013), 117 O.R. (3d) 206, [2013] O.J. No. 4014, 2013 ONSC 5631 (S.C.J.); McCutcheon v. The Cash Store Inc. (2006), 2006 CanLII 15754 (ON SC), 80 O.R. (3d) 644, [2006] O.J. No. 1860, 27 C.P.C. (6th) 293, [2006] O.T.C. 424, 148 A.C.W.S. (3d) 200 (S.C.J.); Meeking v. Cash Store Inc., [2013] M.J. No. 294, 2013 MBCA 81, 48 C.P.C. (7th) 41, 367 D.L.R. (4th) 684, 299 Man. R. (2d) 109, [2014] 3 W.W.R. 118, 230 A.C.W.S. (3d) 971 [Leave to appeal to S.C.C. refused [2013] S.C.C.A. No. 443]; Momentus.ca Corp. v. Canadian American Assn. of Professional Baseball Ltd., [2012] 1 S.C.R. 359, [2012] S.C.J. No. 9, 2012 SCC 9, 290 O.A.C. 202, 428 N.R. 141, EYB 2012-203609, 2012EXP-1107, J.E. 2012-605, 342 D.L.R. (4th) 1, 15 C.P.C. (7th) 227, 211 A.C.W.S. (3d) 850, affg (2010), 103 O.R. (3d) 467, [2010] O.J. No. 4595, 2010 ONCA 722, 270 O.A.C. 36, 325 D.L.R. (4th) 685; Morguard Investments Ltd. v. De Savoye, 1990 CanLII 29 (SCC), [1990] 3 S.C.R. 1077, [1990] S.C.J. No. 135, 76 D.L.R. (4th) 256, 122 N.R. 81, [1991] 2 W.W.R. 217, J.E. 91-123, 52 B.C.L.R. (2d) 160, 46 C.P.C. (2d) 1, 15 R.P.R. (2d) 1, 24 A.C.W.S. (3d) 478; Nantais v. Telectronics Proprietary (Canada) Ltd. (1995), 1995 CanLII 7113 (ON SC), 25 O.R. (3d) 331, [1995] O.J. No. 2592, 127 D.L.R. (4th) 552, 40 C.P.C. (3d) 245, 57 A.C.W.S. (3d) 414 (Gen. Div.) [Leave to appeal to Div. Ct. refused 1995 CanLII 7400 (ON SC), [1995] O.J. No. 3069, 129 D.L.R. (4th) 110, 40 C.P.C. (3d) 263, 58 A.C.W.S. (3d) 908 (Div. Ct.)]; Silver v. Imax Corp., 2009 CanLII 72334 (ON SC), [2009] O.J. No. 5585, 86 C.P.C. (6th) 273 (S.C.J.) [Leave to appeal to Div. Ct. refused (2011), 105 O.R. (3d) 212, [2011] O.J. No. 656, 2011 ONSC 1035, 80 B.L.R. (4th) 228 (Div. Ct.)]; Spar Aerospace Ltd. v. American Mobile Satellite Corp., [2002] 4 S.C.R. 205, [2002] S.C.J. No. 51, 2002 SCC 78, 220 D.L.R. (4th) 54, 297 N.R. 83, J.E. 2003-59, 28 C.P.C. (5th) 201, REJB 2002-36015; Tolofson v. Jensen; Lucas (Litigation Guardian of) v. Gagnon, 1994 CanLII 44 (SCC), [1994] 3 S.C.R. 1022, [1994] S.C.J. No. 110, 120 D.L.R. (4th) 289, 175 N.R. 161, [1995] 1 W.W.R. 609, J.E. 95-61, 51 B.C.A.C. 241, 100 B.C.L.R. (2d) 1, 77 O.A.C. 81, 26 C.C.L.I. (2d) 1, 22 C.C.L.T. (2d) 173, 32 C.P.C. (3d) 141, 7 M.V.R. (3d) 202, 52 A.C.W.S. (3d) 40; Trillium Motor World Ltd. v. General Motors of Canada Ltd., [2012] O.J. No. 1579, 2012 ONSC 1443, 76 E.T.R. (3d) 294, 92 C.C.L.T. (3d) 204, 37 C.P.C. (7th) 30, 214 A.C.W.S. (3d) 349 and [2012] O.J. No. 1578, 2012 ONSC 463, 92 C.C.L.T. (3d) 193, 37 C.P.C. (7th) 19, 214 A.C.W.S. (3d) 348 (Div. Ct.), affg [2011] O.J. No. 889, 2011 ONSC 1300, 7 C.P.C. (7th) 388, 82 C.C.L.T. (3d) 292 (S.C.J.) [Leave to appeal to C.A. refused August 24, 2012]; Webb v. K-Mart Canada Ltd. (1999), 1999 CanLII 15076 (ON SC), 45 O.R. (3d) 389, [1999] O.J. No. 2268, 107 O.T.C. 373, 45 C.C.E.L. (2d) 165, 99 CLLC Â210-038, 36 C.P.C. (4th) 99, 89 A.C.W.S. (3d) 522 (S.C.J.); [page601] Wilson v. Servier Canada Inc. (2000), 2000 CanLII 22407 (ON SC), 50 O.R. (3d) 219, [2000] O.J. No. 3392, [2000] O.T.C. 884, 49 C.P.C. (4th) 233, 24 C.P.C. (5th) 175, 99 A.C.W.S. (3d) 544 (S.C.J.) [Leave to appeal to Div. Ct. refused (2000), 2000 CanLII 29052 (ON SC), 52 O.R. (3d) 20, [2000] O.J. No. 4735 (Div. Ct.), leave to appeal to S.C.C. refused [2001] S.C.C.A. No. 88]

Statutes referred to

Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, c. 3

Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 25

Negligence Act, R.S.O. 1990, c. N.1

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rule 29

Authorities referred to

Waddams, S.M., The Law of Contracts, 6th ed. (Aurora, Ont.: Canada Law Book Inc., 2010)

Watson, Gary D., and Michael McGowan, Ontario Civil Practice 2014 (Toronto: Carswell, 2013)

Williston, W.B., and R.J. Rolls, The Law of Civil Procedure, vol. 1 (Toronto: Butterworths, 1970)

APPEAL from the order of Belobaba J., [2013] O.J. No. 2358, 2013 ONSC 2289 (S.C.J.) dismissing a motion to stay or dismiss third party action.

Jo-Anne Demers, Jean-Olivier Lessard and Susan Guzzo, for appellants.

Peter H. Griffin and Jonathan Erik Laxer, for respondent.

The judgment of the court was delivered by

[1] LAUWERS J.A.: — The appellants are law firms located in the Province of Quebec. They moved for an order dismissing or staying the third party claim issued by the defendant Cassels Brock & Blackwell LLP ("Cassels Brock") in this national class action. The motion judge dismissed the motion, and the parallel motion brought by the third party law firms in provinces other than Ontario and Quebec. Only the Quebec law firms appealed. For the reasons set out below, I would affirm the motion judge's decision and dismiss the appeal.

A. Background Facts

[2] In early 2009, as a result of the financial crisis and "auto bailout", General Motors of Canada Ltd. ("GMCL") terminated over 200 dealerships across the country. GMCL offered compensation to the terminated dealers on terms set out in wind-down agreements ("WDAs"). There were various forms of WDAs to address the various contractual arrangements with the dealers, but they had common provisions: [page602]

(a) "This Agreement is governed by the laws of the Province of Ontario" (article 13);

(b) "The parties consent and agree that the courts of the Province of Ontario have exclusive jurisdiction to hear and determine claims or disputes between the parties hereto pertaining to this Agreement" (article 19);

(c) a signing dealer released and therefore waived its rights under "any and all applicable statute, regulation, or other law, including Ontario's Arthur Wishart Act (Franchise Disclosure), 2000", as well as similar rights under other provinces' franchise laws (article 5(a)(v));

(d) the WDA signed by each dealer had attached a certificate of independent legal advice ("ILA") in standard form signed by a local lawyer.

[3] The motion judge found the following facts, at paras. 30 and 31, which are not disputed:

Here, local lawyers across the country were contacted by local GMCL dealers because the proposed WDA required each dealer "to obtain independent legal advice from a qualified solicitor concerning his/her rights and obligations arising out of or in respect of the Wind Down Agreement." The local lawyer was required [to] sign an ILA certificate certifying that: the lawyer was retained by the dealer; the lawyer has read the WDA; the lawyer has explained the nature and effect of the WDA, including the waivers, releases and indemnification obligations contained therein; the dealer acknowledged that he or she has carefully read the WDA; and the lawyer believes that the dealer was fully advised and informed with regard to all of the foregoing matters.

The two-page ILA Certificate (Exhibit B to the WDA) was signed by the local lawyer and the dealer/client and witnessed. The dealer then attached the ILA Certificate to the WDA, as required by Article 9, and sent the signed documentation to GMCL[.]

[Footnote omitted]

As noted below, the place where GMCL received the dealers' documentation is disputed.

[4] The offer in the WDA was conditional, as provided in article 1, upon all of the dealers sending back to GMCL a signed WDA and ILA by May 26, 2009 at 6:00 p.m. EST, or upon GMCL indicating that it had waived the threshold condition of unanimous acceptance.

[5] On May 30, 2009, Marc Comeau, vice-president of GMCL, sent a letter to the terminated dealers advising that GMCL was waiving the acceptance threshold condition, as he said in his affidavit, "given the high acceptance rate". Mr. Comeau then signed the WDAs for GMCL. [page603]

B. The Litigation History

[6] The plaintiff, Trillium Motor World Ltd., started a national class action in Ontario against GMCL and Cassels Brock claiming damages in the aggregate of $750 million. The terminated dealers are the class members.

[7] In the main action, the class members sue GMCL and Cassels Brock. They claim that GMCL forced them to sign the WDAs in breach of provincial franchise law. They claim that Cassels Brock, while acting as legal counsel for the dealers, was negligent in failing to provide them with appropriate advice about the protections available under provincial franchise law, and about the need for, and the benefit of, collective action. The class members also claim that Cassels Brock had an undisclosed conflict of interest.

[8] The class action was certified by Strathy J.: Trillium Motor World Ltd. v. General Motors of Canada Ltd., [2011] O.J. No. 889, 2011 ONSC 1300 (S.C.J.), affd [2012] O.J. No. 1579, 2012 ONSC 1443 (Div. Ct.) and [2012] O.J. No. 1578, 2012 ONSC 463 (Div. Ct.). On August 24, 2012, this court refused leave to appeal.

[9] In the third party actions, Cassels Brock asserts that it was retained by the Canadian Automobile Dealers' Association and not by any of the individual dealers. But if Cassels Brock is found to have been retained by the dealers and is found liable for negligence in failing to provide appropriate legal advice to them, then the firm seeks contribution and indemnity from the third party law firms that provided the individual dealers with independent legal advice on the advisability of signing the WDAs. If Cassels Brock is found to be liable to the class members for failing to provide appropriate advice about the WDAs, then, in the firm's submission, "so too are the lawyers retained by the non-continuing dealers who would have breached their duties to the class members". In commencing the third party actions, Cassels Brock pleads and relies on Rule 29 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 and the Negligence Act, R.S.O. 1990, c. N.1.

[10] Cassels Brock added about 150 law firms as third party defendants: of these, 67 are based in Ontario, 32 in Quebec and 51 in the eight remaining provinces (19 in Alberta, seven in Nova Scotia, six in each of British Columbia, Saskatchewan and Manitoba, five in New Brunswick and one in each of Newfoundland and P.E.I.). Six of the law firms are described as "national law firms" and have offices in Ontario.

[11] As noted, one jurisdictional motion to stay or dismiss the third party claims was brought by the 32 law firms based in [page604] Quebec and the other by the 51 law firms located outside of Ontario and Quebec. Only the Quebec group appealed. Regardless of the outcome of this appeal, about 118 third party defendants will have their cases determined in Ontario.

C. The Decision under Appeal

[12] On the motions, the out-of-province law firms argued that the Ontario Superior Court lacks jurisdiction over the third party actions, and relied on the decision of the Supreme Court in Club Resorts Ltd. v. Van Breda, [2012] 1 S.C.R. 572, [2012] S.C.J. No. 17, 2012 SCC 17. At para. 90 of Van Breda, LeBel J. established four presumptive connecting factors ("PCFs"), any one of which would, if present, entitle a provincial superior court to take jurisdiction over a legal dispute in tort law: (1) the defendant is domiciled or resident in the province; (2) the defendant carries on business in the province; (3) the tort was committed in the province; or (4) a contract connected with the dispute was made in the province.

[13] The moving parties argued that none of the PCFs were engaged by the third party actions on the facts of this case. In the alternative, they argued that if the Ontario Superior Court has jurisdiction over the third party actions, then it should decline to exercise that jurisdiction on the basis of forum non conveniens, applying the principles expressed in Van Breda. The motion judge disagreed.

[14] The motion judge addressed the application of the fourth PCF, the second PCF and the application of the principles of forum non conveniens.

(1) The fourth PCF: A contract connected with the dispute was made in the province

[15] The motion judge noted, at para. 27, that the "battleground" in the motion was the fourth PCF, which he construed as asking whether, with respect to the third party actions, "a contract connected with the dispute was made in the province". He found that the WDA was the relevant contract and that it was an Ontario contract; this gave the Ontario Superior Court jurisdiction simpliciter over the third party actions.

[16] The motion judge acknowledged that neither Cassels Brock nor the third party local lawyers were parties to the WDA, but he found that this fact was not dispositive, noting, at para. 32:

[T]he local lawyer in providing the required legal advice and signing the ILA Certificate was brought within the scope of the contractual relationship by the very terms of the WDA -- both by Article 9 and by the language of the [page605] ILA Certificate that was signed by the local lawyer and dealer and then attached to the WDA as an Exhibit.

(Emphasis in original)

He added [at para. 32] that the signed ILA certificate "became an integral part of the Ontario contract".

[17] The motion judge's analysis of the fourth PCF is found at para. 34:

Did "the events that gave rise to the [tort] claim flow from the relationship created by the [Ontario] contract?" In my view, they did. Recall that the substance of CBB's third party claim is that if CBB is liable to class members/dealers for failing to provide proper legal advice regarding the WDA, so too are the local lawyers that were retained by the same dealers. The local lawyers were obliged by the terms of the ILA Certificate to not only explain the nature and effect of the WDA and its various waivers and releases (including, one would assume, the waiver in Article 5(a) (v) of any rights or protections otherwise available under provincial franchise law) but also to ensure that the dealer/client was "fully advised and informed" thereto. In short, the dispute between CBB and the third party defendants about whether the latter provided proper legal advice arises and flows out of the relationship created by the WDA and the required ILA.

[18] The motion judge concluded, at para. 40, that "the WDA is sufficiently connected with the tort claim against the local lawyers so as to raise a presumption of a real and substantial connection between the subject matter of the litigation and Ontario".

[19] The motion judge added, at paras. 41-42, that it was reasonable for the out-of-province local lawyers to be called upon to defend Ontario proceedings challenging their advice, since they had advised on the content of the WDA, which expressly provides both that it is governed by Ontario law and that all disputes about it would be litigated in Ontario.

(2) The second PCF: The defendant carries on business in Ontario

[20] The motion judge found, at para. 26, that the six national law firms named as third parties carry on business in Ontario and were therefore caught by the second PCF. Three of them have offices in Quebec, but only two are relevant to this appeal because the third advised a class member who opted out of the class proceeding.

(3) Forum non conveniens

[21] The motion judge refused to decline jurisdiction over the third party actions on the basis of forum non conveniens. Instead, he found that Ontario was the most convenient forum [page606] for their determination. His analysis was sparse but direct. He found that [at para. 48] the moving parties had failed to meet the onus on them to demonstrate that another province was "clearly more appropriate", citing paras. 22-23 of Breeden v. Black, [2012] 1 S.C.R. 666, [2012] S.C.J. No. 19, 2012 SCC 19 and para. 108 of Van Breda. The motion judge concluded, at para. 49:

Here we have 67 defendants in Ontario, 32 in Quebec and the rest scattered across the remaining eight provinces. It cannot be seriously maintained that Quebec (with only 32 lawyers) or Alberta (with only 19 lawyers) are "clearly more appropriate" forums. If CBB's third party action against the 150 local lawyers proceeds it must proceed in Ontario. This is by far the most appropriate and convenient forum.

D. The Positions of the Parties

[22] The appellants argue that the motion judge erred in applying the fourth PCF, the second PCF and the principles of forum non conveniens.

[23] The respondent submits that the motion judge made no error in these determinations. The respondent adds that, in applying the fourth PCF, this court ought to consider the nature of the case as a national class action.

E. Analysis

(1) The standard of review

[24] The standard of review for errors of law is correctness. The motion judge's findings of fact and his exercises of discretion attract appellate deference unless he has made a palpable and overriding error or an error in principle.

(2) The issues

[25] The appellants aim their challenges at what are arguably some unclear points in the Supreme Court's Van Breda analysis. Their complaints form a useful framework for the analysis:

(1) Did the motion judge err in applying the fourth PCF?

(2) Did the motion judge err in applying the second PCF?

(3) Is Quebec clearly a more appropriate forum than Ontario for the third party actions against Quebec-based local counsel?

[26] Before turning to these issues, I make some preliminary observations about the real and substantial connection test for jurisdiction. [page607]

(3) The real and substantial connection test

[27] In Morguard Investments Ltd. v. De Savoye, 1990 CanLII 29 (SCC), [1990] 3 S.C.R. 1077, [1990] S.C.J. No. 135, La Forest J., noted, at p. 1108 S.C.R., para. 51, that the real and substantial connection test is a form of judicial self-restraint:

It seems to me that the approach of permitting suit where there is a real and substantial connection with the action provides a reasonable balance between the rights of the parties. It affords some protection against being pursued in jurisdictions having little or no connection with the transaction or the parties.

[28] Justice La Forest added, in Tolofson v. Jensen; Lucas (Litigation Guardian) v. Gagnon, 1994 CanLII 44 (SCC), [1994] 3 S.C.R. 1022, [1994] S.C.J. No. 110, at p. 1049 S.C.R., para. 40, that "[t]his test has the effect of preventing a court from unduly entering into matters in which the jurisdiction in which it is located has little interest".

[29] Morguard is often cited for some basic propositions about the importance of the Canadian common market. The ruling concept is comity, about which La Forest J. observed, at p. 1098 S.C.R., para. 35:

The considerations underlying the rules of comity apply with much greater force between the units of a federal state, and I do not think it matters much whether one calls these rules of comity or simply relies directly on the reasons of justice, necessity and convenience to which I have already adverted.

[30] This approach reflects, as La Forest J. noted, at p. 1099 S.C.R., para. 36, that "[o]ne of the central features of the constitutional arrangements incorporated in the Constitution Act, 1867 was the creation of a common market". He also observed, at p. 1107 S.C.R., para. 48, that "in Moran [Moran v. Pyle National (Canada) Ltd., 1973 CanLII 192 (SCC), [1975] 1 S.C.R. 393] Dickson J. derived the reasonableness of his approach from the 'normal distributive channels' of products and, in particular, the 'interprovincial flow of commerce'". La Forest J. added, at p. 1107 S.C.R., para. 49, that "[t]he above rationale is not, as I see it, limited to torts"; it was "obviously relevant to contracts". See, also, the supportive comments of LeBel J. in Spar Aerospace Ltd. v. American Mobile Satellite Corp., [2002] 4 S.C.R. 205, [2002] S.C.J. No. 51, 2002 SCC 78, at para. 53.

[31] Finally, at least part of the court's concern must be with the efficient operation of that common market and the need to avoid fragmenting lawsuits unduly. In Van Breda, LeBel J. noted, at para. 99: [page608]

I should add that it is possible for a case to sound both in contract and in tort or to invoke more than one tort. Would a court be limited to hearing the specific part of the case that can be directly connected with the jurisdiction? Such a rule would breach the principles of fairness and efficiency on which the assumption of jurisdiction is based. The purpose of the conflicts rules is to establish whether a real and substantial connection exists between the forum, the subject matter of the litigation and the defendant. If such a connection exists in respect of a factual and legal situation, the court must assume jurisdiction over all aspects of the case. The plaintiff should not be obliged to litigate a tort claim in Manitoba and a related claim for restitution in Nova Scotia. That would be incompatible with any notion of fairness and efficiency.

[32] The facts in this case exemplify the operation of the Canadian common market in goods and services. The interprovincial flow of commerce led to the appellants' retainers in this case.

[33] I make four observations about the Supreme Court's approach that are relevant to the task of the court in this case.

[34] First, the basic message is that an Ontario court should be neither too quick nor too slow to take jurisdiction over a dispute.

[35] Second, there is usually another court that could take jurisdiction on a similar basis.

[36] Third, there is no perfect court for a dispute that crosses borders. The connections with the province need not be the strongest nor all point in the same direction, as LeBel J. noted in Van Breda, at para. 34. There may not be a single preferable place when many of the witnesses and parties are from different places, as LeBel J. observed in Spar, at para. 73.

[37] Fourth, the smooth operation of the Canadian common market is a relevant consideration in the application of the real and substantial connection test.

[38] I turn now to consider the issues, bearing in mind the underlying question: Is it fair to subject the third party appellants to the jurisdiction of the Ontario courts?

(4) Issue one: The fourth Van Breda PCF

[39] To qualify for the application of the fourth PCF, the court must find, in the words of Van Breda [at para. 90], that "a contract connected with the dispute was made in the province". The motion judge found that the WDA was an Ontario contract and that it qualified to give the Ontario Superior Court jurisdiction over the third party actions.

[40] The appellants contend that the motion judge erred, first, in finding that the relevant contract was not the individual retainer agreements between the class members and their local [page609] counsel, but the WDA; and second, in finding that the WDA was a contract made in Ontario

I. Is the WDA the relevant contract?

[41] The appellants argue that the only contracts relevant to the fourth PCF are the contracts for legal services between themselves and the class members on which the third party actions are based, which, they submit "have no connection with Ontario as they were concluded and executed exclusively in Quebec, and not in Ontario". They assert the following arguments in support of their position that the WDAs are not connected with the third party claim: none of the parties to the third party actions were parties to the WDA; none of the third parties benefitted directly from the WDAs; Cassels Brock's breach of contract claims against the third parties are based on the contracts for professional services between the class members from Quebec and their Quebec-based local lawyers, and the advice they gave, not on the WDAs; and the motion judge did not properly apply this court's decision in Export Packers Co. v. SPI International Transportation, [2012] O.J. No. 3126, 2012 ONCA 481.

[42] I would not give effect to these arguments.

[43] The motion judge considered the fourth PCF, not by assessing the contracts for legal services alone, as the appellants say is required, but by assessing the actual work that the appellants undertook as lawyers under the contracts for legal services, according to the terms of the WDA and the ILA that was associated with it. The motion judge accepted the respondent's argument, noted at para. 22, that "[t]he 'epicentre' of the dispute . . . in both the main action against CBB and the latter's third party claim, is the legal advice that was given in relation to the WDAs" (emphasis added). He stated, at para. 32:

[I]n my view, the local lawyer in providing the required legal advice and signing the ILA Certificate was brought within the scope of the contractual relationship by the very terms of the WDA -- both by Article 9 and by the language of the ILA Certificate that was signed by the local lawyer and dealer and then attached to the WDA as an Exhibit. The extent to which the local lawyers were brought within the scope of the WDA relationship is, in my opinion, stronger here than was the case with Ms. Van Breda. She only received a benefit from the contract. Here, there are actual contractual terms that required local lawyer involvement and the completion of a signed ILA Certificate, which became an integral part of the Ontario contract.

[Emphasis in original]

[44] It is implicit in the appellants' position, which they did not deny in oral argument, that the court should divorce the [page610] third party actions from the main action in assessing the application of the fourth PCF to the third party actions, and consider only the contracts for legal services to be directly implicated in the third party actions.

[45] I would not give effect to this position.

[46] In my view, for the purpose of applying the jurisdictional test, the court must take the action as it finds it, and must consider the action as a whole, recognizing the legitimate engagement of the Rules of Civil Procedure in structuring the action. The respondent has invoked Rule 29 and added the appellants as third parties, not unreasonably. The objects of third party proceedings appear to be well engaged by the third party actions in this case. These are conveniently listed by W.B. Williston and R.J. Rolls in The Law of Civil Procedure, vol. 1 (Toronto: Butterworths, 1970), at pp. 426-27:

to avoid a multiplicity of actions. The procedure provides a substitute for another action, and disposes of all issues arising out of a transaction as between the plaintiff and the defendant, and between the defendant and a third party;

to avoid the possibility that there might otherwise be contradictory or inconsistent findings in two different actions on the same facts;

to allow the third party to defend the plaintiff's claim against the defendant;

-- to save costs; and

to enable the defendant to have the issue against the third party decided as soon as possible, in order that the plaintiff cannot enforce a judgment against him before the third party issue is determined.

(Footnotes omitted)

[47] In this court's decision in Van Breda v. Village Resorts Ltd. (2010), 2010 ONCA 84, 98 O.R. (3d) 721, [2010] O.J. No. 402 (C.A.), Sharpe J.A. noted, at para. 79:

With respect to rule 17.02(o), given the very generous scope of Rule 5 for the joinder of parties, the fact that a foreign defendant qualifies as a "necessary or proper party" to a proceeding is not, by itself, a reliable indicator that there is a real and substantial connection to support the assertion of jurisdiction over that defendant.

(Emphasis by Sharpe J.A.)

Justice Sharpe did not refer specifically to sub-rule 17.02(q), which addresses a "third or subsequent party claim under these rules", but I infer that he meant these reservations to apply to that sub-rule as well. At para. 102, Sharpe J.A. referred to the involvement of other parties as a "possible (not a presumptive) connecting factor that may justify assuming jurisdiction". His insight was that the action had to be considered as a whole. [page611]

[48] While it is true that the Supreme Court in Van Breda did not provide a road map for the application of the fourth PCF to third party actions, since LeBel J., at paras. 55 and 60, cited Sharpe J.A.'s observations, he was plainly alive to the possible presence of added parties. I infer that the Supreme Court expected the PCF analysis to apply to third party actions, with necessary modifications.

[49] In my view, the motion judge did not err in taking a holistic approach to the action as he found it. It was appropriate for him to do so and to consider the WDAs for the purpose of applying the fourth PCF to the third party actions. There is plainly a relationship between a third party claim and the main action with which it is associated. A third party claim is a "device by which a defendant may engraft on to the main action any 'related claim' he or she may have against non-parties": Gary D. Watson and Michael McGowan, Ontario Civil Practice 2014 (Toronto: Carswell, 2013), at p. 752. It is precisely because of the relationship between the main action and the third party actions that the third party actions proceed as such rather than independently. This relationship is reflected in the Rules of Civil Procedure, which permit a third party to defend the main action and provide that third party actions are ordinarily tried together with the main action. Accordingly, in applying the fourth PCF to the third party actions, I reject the appellants' argument that the WDAs, which figure prominently in the main action, should be ignored.

[50] The appellants' supporting arguments founder for similar reasons. I cannot improve on the motion judge's accurate description, at para. 34 of his decision, of the integral relationship between the WDAs, the contracts for legal services between the appellants and the Quebec class members, the advice the local lawyers were to give and the ILAs that they were obliged to sign attesting to having provided such advice. I see no basis for holding that the relevance of the WDA to the application of the fourth PCF depends on the parties to the third party claim also being parties to the WDA, or on the third parties having benefitted directly from the WDAs. (I note that the appellants did benefit indirectly from the WDAs in the fees they earned.) Even though Cassels Brock's claims against the third parties are based, in part, on the contracts for professional services between the class members from Quebec and their Quebec-based local lawyers, and the advice they gave, their professional duties and that advice are deeply connected with the WDAs. [page612]

[51] The appellants argue that the mere fact that a lawyer in a foreign jurisdiction gives an opinion on Ontario law does not subject the lawyer to the jurisdiction of the Ontario court for that reason alone. While I agree with the argument generally, it does not apply in this case, for the reasons just advanced.

[52] Finally, in my view the motion judge properly distinguished this court's decision in Export Packers. The plaintiff, Export Packers, was an Ontario company that sold food products. Export Packers contracted with SPI, a shipping agent with two offices in Ontario, to arrange transportation of cargo from a Quebec warehouse operated by a Quebec company, Entrepôt du Nord Cold Storage Inc. ("EDN"), to a Florida customer. SPI then contracted with a third party, Transvision Logistics, to transport the cargo to Florida. The pleadings asserted that a rogue purporting to be working for Transvision Logistics picked up the cargo at EDN's warehouse and absconded.

[53] Export Packers sued SPI for breach of contract and negligence in Ontario. SPI made a third party claim against EDN, claiming that EDN was negligent for failing to get sufficient identification from the rogue before releasing the cargo. The motion judge stayed the third party claim against EDN on the basis that the Ontario court lacked jurisdiction in the absence of a real and substantial connection between Ontario and the claim against EDN. This court upheld the motion judge.

[54] The motion judge correctly distinguished this court's decision in Export Packers, at paras. 39 and 40:

The Court of Appeal concluded that the three Ontario contracts had no connection to EDN other than that they anticipated that the cargo would be picked up at EDN's warehouse in Quebec. The dispute between SPI and EDN related only to the alleged negligence of EDN in releasing the cargo and "the contracts relied upon [did] not address the issue of release of the cargo by EDN as storer" (my emphasis).

Here however, the dispute between CBB and the local lawyers relates to the alleged negligence in the provision of legal advice and here, to track the language just quoted, the Ontario contract that is being relied upon, i.e. the WDA, does indeed address the issue of the provision of legal advice by the local lawyers. Thus, Export Packers, in my view, provides support for my conclusion that the WDA is sufficiently connected with the tort claim against the local lawyers so as to raise a presumption of a real and substantial connection between the subject matter of the litigation and Ontario.

[55] For the reasons set out above, I would agree with the motion judge that the most relevant contract for the application of the fourth PCF is the WDA. [page613]

II. Is the WDA a contract made in Ontario?

[56] To engage the fourth PCF, the WDA must be a contract made in Ontario. The motion judge noted, at paras. 5 and 9, that

. . . the Court in Van Breda did not really explain how it came up with this fourth presumptive connecting factor[.]

One has to interpret and apply what the Supreme Court has decided. However, given the somewhat shaky foundation for the Fourth PCF, motion judges would be well advised to proceed with caution until further appellate direction is provided.

[57] Legal disputes are increasingly extending beyond the boundaries of a province or country. The Supreme Court of Canada decisions recognize that, in this cosmopolitan environment, the place of a tort or a contract could not always be easily identified. In Morguard, for example, La Forest J. noted, at pp. 1108-1109 S.C.R., para. 51, that,

In a world where even the most familiar things we buy and sell originate or are manufactured elsewhere, and where people are constantly moving from province to province, it is simply anachronistic to uphold a "power theory" or a single situs for torts or contracts for the proper exercise of jurisdiction.

[58] Despite these observations, the fourth PCF assumes that it is relatively simple to identify the place of the contract.

[59] I consider this issue in two steps: first, as a matter of the simple application of the traditional common law rules for determining the place of the contract; and second, considering whether the strict application of the traditional rules makes sense in the context of the real and substantial connection test.

a. Traditional contract placement rules

[60] The appellants contend that the WDAs, as contracts between GMCL and the Quebec class members, were made in Quebec, because the Quebec dealers sent their executed WDAs to a regional zone office manager located in Quebec. This was the instruction in the letter from Marc Comeau, GMCL's vice-president, sales, service and marketing, dated May 20, 2009, by which the dealers got a copy of the WDA. His letter and the WDA offer were apparently sent from his office in Oshawa via e-mail, according to the exhibited copy that the principal of Trillium Motor World received. The letter provided:

Our offer, as set out in the Wind-Down Agreement, is conditional upon all of the Non-Retained Dealers accepting the offer (the "Acceptance [page614] Threshold Condition") and executing and delivering their respective Wind-Down Agreements to GM Canada on or before May 26, 2009 at 6:00 pm EST (the "End of the Offer Period"). GM Canada reserves the right, in its discretion, to waive the Acceptance Threshold Condition. Any Wind-Down Agreement signed and returned to GM Canada by the End of the Offer Period will not become effective unless and until GM Canada provides written notice to those dealers that the Acceptance Threshold Condition and any other required conditions have been met or have been waived by GM Canada.

These difficult actions with respect to GM Canada's dealer network restructuring are part of a number of initiatives that GM Canada has undertaken, and must achieve quickly, to avoid the necessity of filing for reorganization. If you are interested in entering into the Wind-Down Agreement, you should review the Wind-Down Agreement with legal, tax and any other advisors of your choosing. To accept, please request your counsel to complete a certificate of independent legal advice (attached as an Exhibit to the Wind-Down Agreement). Please send the signed certificate together with the executed Wind-Down Agreement by the End of the Offer Period by pdf or fax to your Regional Zone Office Manager, as listed below, with two original signed copies of the Agreement, each with an original signed Certificate, to follow by courier.

(Emphasis added)

[61] The appellants argue that, by sending the signed WDAs to GMCL's Quebec regional office, the Quebec dealers accepted GMCL's offer contained in the WDAs. The appellants note that there is no evidence that GMCL received notification of the Quebec dealers' acceptance of the WDAs in Ontario. It is clear, however, on the evidence that Mr. Comeau had the signed WDAs in Oshawa and signed them there for GMCL. (The appellants provided no evidence of their own on this issue but rely on the communications between Trillium Motor World and GMCL as the template pattern for all the dealers.)

[62] Based on the express terms of the WDAs and Mr. Comeau's covering letter, the receipt by the Quebec regional manager of signed WDAs from individual Quebec dealers did not create a binding agreement between the class members and GMCL. Article 1 of the WDAs provides that the offer made by GMCL to the class members was conditional upon all of the dealers sending back to GMCL a signed WDA and ILA by May 26, 2009 at 6:00 p.m. EST, or upon GMCL indicating that it had waived the acceptance threshold condition. Thus, the WDAs would not become binding agreements until one of these two events occurred.

[63] Most, but not all, of the dealers sent back signed WDAs by the May 26 deadline. It was then up to GMCL to decide whether or not to waive the acceptance threshold condition in order for the WDAs to become effective. [page615]

[64] Mr. Comeau's affidavit states: "on May 30, 2009, GMCL notified the Accepting Dealers that it waived the Acceptance Threshold Condition". His letter to the dealers on that day stated:

While not all Non-Retained Dealers accepted our conditional offer, we are very pleased to inform you that a substantial number of the Non-Retained Dealers have accepted GM Canada's conditional offer to enter into the Wind Down Agreement. This letter will serve as notice pursuant to Section 1 of the Wind Down Agreement that GM Canada is hereby waiving the Acceptance Threshold Condition and, accordingly, the Wind Down Agreement that you executed and delivered to GM Canada shall become effective as of today, May 30, 2009. GM Canada will be executing and delivering to you a fully executed copy of the Wind Down Agreement in the near future for your records.

[65] The exhibited letter was sent by e-mail to Trillium Motor World, and was presumably sent in a similar manner to the other dealers. Was this notice of waiver the last act of contractual formation?

[66] When acceptance of a contract is transmitted electronically and instantaneously, the contract is usually considered to be made in the jurisdiction where the acceptance is received: see Eastern Power Ltd. v. Azienda Communale Energia and Ambiente, 1999 CanLII 3785 (ON CA), [1999] O.J. No. 3275, 178 D.L.R. (4th) 409 (C.A.), at paras. 23, 27-29, leave to appeal to S.C.C. refused [1999] S.C.C.A. No. 542; Inukshuk Wireless Partnership v. 4253311 Canada Inc. (2013), 117 O.R. (3d) 206, [2013] O.J. No. 4014, 2013 ONSC 5631 (S.C.J.), at paras. 25-29; Christmas v. Fort McKay First Nation (2014), 119 O.R. (3d) 21, [2014] O.J. No. 390, 2014 ONSC 373 (S.C.J.), at para. 18.

[67] It seems to me, however, that the stipulated manner in which the WDAs would become effective renders inapplicable the general rule that a contract transmitted instantaneously is made in the jurisdiction where the acceptance is received. Certainly, the receipt of the signed WDAs by GMCL in Quebec was not the last act of contract formation, nor, in my view, was the notice of GMCL's waiver.

[68] The motion judge's conclusion that the relevant act of contract formation occurred at GMCL's head office in Oshawa, where Mr. Comeau accepted and signed the WDAs returned by the dealers that had already been signed by them, is supported by the evidence. This act of acceptance, and not the e-mail notification of the waiver, constituted the last act essential to contract formation: see S.M. Waddams, The Law of Contracts, 6th ed. (Aurora, Ont.: Canada Law Book Inc., 2010), at paras. 108-109.

[69] I see no error in this finding. [page616]

b. A broader approach

[70] Should the traditional rules for determining the place of the contract be determinative in applying the fourth PCF? This is perhaps an issue for another case, but I agree with the observation of Professor Waddams, at paras. 108-109, that the arbitrary common law rules for determining the place of a contract may not always be apposite in jurisdictional cases. The traditional contract placement rules respond to concerns that are different from those engaged by a jurisdictional analysis. A broader, more contextual analysis is required, which would inevitably engage the same considerations as the real and substantial connection test itself.

[71] In this case, the WDA provides expressly that it is governed by the law of Ontario and that the parties to it attorn to Ontario's jurisdiction in the event of a dispute related to it. This is not simply an arbitrary forum selection provision, as might be the case in a commercial contract that specifies an arbitral jurisdiction. GMCL's head office is located in Ontario. The bulk of the affected dealers were located in Ontario. The underlying structure of the business relationships and the litigation are deeply related to Ontario.

[72] On a broader basis, these contextual facts would support the correctness of the motion judge's conclusion that the WDAs were Ontario contracts.

c. Does the status of the appellants as participants in a national class action affect the application of the real and substantial connection test?

[73] On the certification motion, the issue of the jurisdiction of the Ontario court over the claims of non-resident class members was not raised by the parties, nor was it addressed by Strathy J. This is perhaps because the concept of a national class is well established in Ontario class proceedings jurisprudence: see Nantais v. Telectronics Proprietary (Canada) Ltd. (1995), 1995 CanLII 7113 (ON SC), 25 O.R. (3d) 331, [1995] O.J. No. 2592 (Gen. Div.), leave to appeal to Div. Ct. refused 1995 CanLII 7400 (ON SC), [1995] O.J. No. 3069, 129 D.L.R. (4th) 110 (Div. Ct.); Carom v. Bre-X Minerals Ltd. (1999), 1999 CanLII 14781 (ON SC), 43 O.R. (3d) 441, [1999] O.J. No. 281 (Gen. Div.); Webb v. K-Mart Canada Ltd. (1999), 1999 CanLII 15076 (ON SC), 45 O.R. (3d) 389, [1999] O.J. No. 2268 (S.C.J.); Wilson v. Servier Canada Inc. (2000), 2000 CanLII 22407 (ON SC), 50 O.R. (3d) 219, [2000] O.J. No. 3392 (S.C.J.), leave to appeal to Div. Ct. refused (2000), 2000 CanLII 29052 (ON SC), 52 O.R. (3d) 20, [2000] O.J. No. 4735 (Div. Ct.), leave to appeal to S.C.C. refused [2001] S.C.C.A. No. 88; [page617] McCutcheon v. The Cash Store Inc. (2006), 2006 CanLII 15754 (ON SC), 80 O.R. (3d) 644, [2006] O.J. No. 1860 (S.C.J.); Silver v. Imax Corp., 2009 CanLII 72334 (ON SC), [2009] O.J. No. 5585, 86 C.P.C. (6th) 273 (S.C.J.), leave to appeal to Div. Ct. refused (2011), 105 O.R. (3d) 212, [2011] O.J. No. 656, 2011 ONSC 1035 (Div. Ct.).

[74] The respondent submitted in its factum that "The fact that the Third Party Claim at issue was properly issued in the context of a national class action is a connecting factor which provides a basis for Ontario courts to assume jurisdiction." The respondent did not pursue this issue in argument. The appellants did not respond. In the absence of a complete argument, I would decline to deal with this issue.

[75] I observe, however, that in Meeking v. Cash Store Inc., [2013] M.J. No. 294, 2013 MBCA 81, 367 D.L.R. (4th) 684, leave to appeal to S.C.C. granted [2013] S.C.C.A. No. 443, the Manitoba Court of Appeal created a new class action-based presumptive connecting factor that is capable of establishing a provincial superior court's jurisdiction over a national class action.

(5) Issue two: The second Van Breda PCF

[76] As noted, the motion judge found, at para. 26, that the six national law firms named as third parties carry on business in Ontario and were therefore caught by the second PCF. Three of them have offices in Quebec, but only two are relevant because the third advised a class member who opted out.

[77] The appellants argue that the motion judge erred in failing to find that the presumption in the second PCF had been rebutted, consistent with the Supreme Court's decision in Van Breda, where LeBel J. noted, at para. 96: "the presumption can be rebutted by showing that the subject matter of the litigation is unrelated to the defendant's business activities in the province". The appellants assert that the PCF is rebutted because "only partners and employees working at their places of business in Quebec were involved". Accordingly, relying on para. 97 of Van Breda, they submit that there is "a weak relationship" between Ontario and the subject matter of the litigation.

[78] The motion judge mentioned but did not thoroughly address the second PCF argument. He focused instead on the fourth PCF. As will be noted below, he specifically rejected the appellants' argument that it would not be reasonable to expect that they would be called to answer proceedings in Ontario.

[79] The role of national law firms in Canada's common market, and the application of the real and substantial connection test to them, is best left to a case where the issue is fully [page618] engaged. In light of my conclusions on the application of the fourth PCF, I would not decide this issue.

(6) Issue three: The forum non conveniens test

[80] The motion judge refused to decline jurisdiction over the third party actions on the basis of forum non conveniens. His analysis of the issue was, as noted, sparse. The motion judge relied on Breeden for the proposition that he expressed, at para. 48:

When defendants are scattered over a number of jurisdictions and only one forum can be selected, the forum selected by the plaintiff can only be displaced if the defendants can point to an alternative forum that is "clearly more appropriate".

He concluded, at para. 49, that "[i]f CBB's third party action against the 150 local lawyers proceeds, it must proceed in Ontario. This is by far the most appropriate and convenient forum", given the large concentration of third parties in Ontario, and the distribution of the remainder across Canada. This disposition echoes the Supreme Court of Canada's Canadian common market orientation. See, also, Momentus.ca Corp. v. Canadian American Assn. of Professional Baseball Ltd. (2010), 103 O.R. (3d) 467, [2010] O.J. No. 4595, 2010 ONCA 722, at paras. 52-53, affd [2012] 1 S.C.R. 359, [2012] S.C.J. No. 9, 2012 SCC 9.

[81] The appellants argue that the motion judge did not apply the factors for addressing forum non conveniens specified by the Supreme Court in Van Breda, at para. 110:

[T]he factors that a court may consider in deciding whether to apply forum non conveniens may vary depending on the context and might include the locations of parties and witnesses, the cost of transferring the case to another jurisdiction or of declining the stay, the impact of a transfer on the conduct of the litigation or on related or parallel proceedings, the possibility of conflicting judgments, problems related to the recognition and enforcement of judgments, and the relative strengths of the connections of the two parties.

[82] The appellants point out that the relevant class members are all from Quebec; the appellants are all members of the Quebec bar, and are domiciled and carry on business there, where most of them were served. The main witnesses to these third party actions would be from Quebec. The appellants argue that the applicable legal standards respecting their legal advice would be those of the legal profession in Quebec, on which expert evidence would be required. Accordingly, the appellants say that the location of parties and witnesses favours Quebec, and that having their trials in Ontario would add significant cost. There [page619] would be no efficiency gain in hearing the third party claim against the appellants in Ontario.

[83] This argument assumes, in my view prematurely and improbably, that all of the third party actions will proceed independently as ordinary actions after judgment in the main action. The case management judge has discretion to structure the resolution of the third party actions in a more efficient and expeditious way -- for example, by way of test cases -- to avoid the inefficiencies and costs cited by the appellants.

[84] While I agree that the motion judge did not expressly carry out the Van Breda forum non conveniens analysis, he was alive to the issues. He noted, at para. 44, that "it would be reasonable to expect that the out-of-province local lawyers would be called to answer the legal proceedings in Ontario". This relates to "the relative strengths of the connections" factor referred to in Van Breda. The motion judge gave two reasons, which I consider to be sound, for finding that it would be reasonable to expect the out-of-province local counsel to defend in Ontario, at paras. 41 and 42:

One, the local lawyers reviewed the WDA and knew that it was governed by Ontario law and that all disputes would have to be litigated in Ontario. To be sure, they were not parties to the WDA, but, as already noted, they were brought within the scope of this contractual relationship by the dealer's need for legal advice and the provision of that advice as documented by the signed ILA Certificate that they knew would become a part of the contract.

Two, the third party claim is all about the provision and adequacy of the local lawyer's legal advice, a topic that was explicitly addressed within the scope of the lawyer/dealer/ GMCL relationship by the terms of both the WDA and the ILA Certificate.

[85] The appellants argue that obliging Cassels Brock to bring the third party claims against them in Quebec "will have absolutely no impact on the principal action". They assert that there are no common issues in the third party claims, and rely on the motion judge's comment, at para. 24:

[T]he 150 claims that would be brought in the other nine provinces would not be identical. Each case would be fact-specific and would depend on the particular advice that was given by each local lawyer to his or her particular dealer/ client.

[86] I disagree with the motion judge's observation that the third party actions lack commonality. Given the common elements of the WDAs, the ILAs and the content of Ontario law, it seems to me that the core of the legal advice that ought to have been given by local lawyers will be very similar for each, subject to any relevant differences in the applicable franchise [page620] legislation; such differences could still be addressed without resort to individual determinations. Although there may be some variation in the advice actually given and in the terms of the contracts for legal services, there is no reason to think that the case management judge would not be able to create efficient methods for adjudicating these issues, given the tools available under the Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 25.

[87] I infer that the motion judge's rationale for situating the third party actions in Ontario was to avoid inconsistent results, quite apart from the efficiency of a single lawsuit. It is obvious that the trigger for possible third party liability would be the conclusive judgment in the main action that Cassels Brock is liable on a legal and factual basis that would engage the advice given by the local lawyers to their clients. There is no reasonable basis for permitting divergent judgments to arise, after the main action, on that issue, by requiring Cassels Brock to pursue new, free-standing actions in Quebec.

[88] I am not persuaded that the motion judge made an error in principle in exercising his discretion to dismiss the appellants' forum non conveniens motion. His decision is entitled to deference.

F. Disposition

[89] For the reasons set out above, it is, in my view, fair to subject the third party appellants to the power of the courts of Ontario. I would dismiss the appeal, with costs to the respondent fixed by agreement at $12,000, all inclusive.

Appeal dismissed.

End of Document