The Supreme Court of Canada heard two appeals arising from a motion for a declaratory judgment filed by Hydro-Québec in the Superior Court of Quebec.
Hydro-Québec sought a declaration regarding its rights under a Power Contract with Churchill Falls, following an Order in Council by Newfoundland requiring Churchill Falls to supply it with power.
Newfoundland filed a declinatory exception, arguing the Quebec courts lacked jurisdiction over it, while Churchill Falls filed a motion to dismiss, arguing Hydro-Québec lacked sufficient interest and raising lis pendens.
The Court allowed Newfoundland's appeal, holding that the jurisdiction clause in the Power Contract did not bind Newfoundland, which was not a party to it.
The Court dismissed Churchill Falls' appeal, finding that Hydro-Québec had a real interest in resolving the genuine legal problem created by the threat to its contractual rights, and that there was no lis pendens with the proceedings in Newfoundland.
