SUPERIOR COURT OF JUSTICE – ONTARIO

PETERBOROUGH COURT FILE NO.: 119/11
DATE: 20120327

RE: Melanie Doris Young and Daniel Joseph Young, Plaintiffs

AND:

The Home Depot, U.S.A., Inc., Defendant

BEFORE: The Honourable Mr. Justice D.S. Gunsolus at Peterborough, Ontario

HEARD: March 21, 2012

COUNSEL: Robert W. Becker, Counsel for the Plaintiffs

S. Alexandre Proulx, Counsel for the moving party, Defendant

E N D O R S E M E N T

Background:

[ 1 ] The defendant Home Depot moves for a stay of proceedings on the basis that an Ontario Court should not assume jurisdiction of a tort action in relation to a trip and fall accident that occurred in Watertown, New York State, United States of America.

[ 2 ] On or about the 17 th day of June, 2011, the plaintiffs caused a statement of claim to be issued, naming the Home Depot, U.S.A. Inc., as defendant. Said statement of claim was issued by the Superior Court of Justice at Peterborough, Ontario, Canada.

[ 3 ] The plaintiff alleges that the named defendant operates numerous Home Depot stores across the USA, including one located at 391 College Heights, Watertown, State of New York.

[ 4 ] The plaintiff, Melanie Doris Young, claims damages for a personal injury suffered when she, on or about the 22 nd of June, 2009, allegedly fell within the Watertown Home Depot store, as a result of tripping over a bunched up section of rug located at the entrance to the Home Depot store.

[ 5 ] The plaintiff alleges that she attended the store with her brother who had undertaken internet research of the Home Depot Canada and Home Depot USA sites in search of certain products. He determined that the cheapest could be obtained at the Watertown location and thus the reason for the trip to Watertown.

[ 6 ] The defendant has not attorned to the jurisdiction of Ontario and has taken no steps, including the filing of a statement of defence, which could be deemed to be an attornment to this jurisdiction.

[ 7 ] It is acknowledged by counsel for the plaintiffs and defendant that the persons with the plaintiff did not witness her fall. No employees of Home Depot witnessed her fall, nor have either the plaintiffs or the defendant been able to find any witness to the fall. The employees of Home Depot will provide evidence, ultimately, that they are unaware of a similar incident ever having occurred at the premises; that they have received no similar complaints in relation to the alleged state of the rug in the store on the 22 nd of June, 2009, nor did they observe the alleged rug “pucker” during routine inspections and no other person complained of the state of the rug on the day in question. There is no camera surveillance of the location in question.

The Defendant’s motion:

[ 8 ] The defendant’s motion is for:

(a) An Order setting aside the service of the Statement of Claim pursuant to Rule 17 of the Rules of Civil Procedure ;

(b) An Order under section 106 of the Courts of Justice Act staying the proceedings due to the lack of jurisdiction of the Ontario Courts;

(c) In the alternative, an Order pursuant to Rule 17.06(1)(b) and Rule 17.06(2)(c) of the Rules of Civil Procedure staying these proceedings on the basis that Ontario is not the convenient forum for the hearing of proceeding;

(d) Substantial indemnity costs of this motion and of the action to the Defendant, The Home Depot; and

(e) Such further and other relief as counsel may advise and the Honourable Court may deem just.

The Issue:

[ 9 ] It is agreed that the issue before the court is: “Does this court have jurisdiction over an out-of-province defendant for damages sustained as a result of an alleged tort that occurred in New York State, and if so, should Ontario assume jurisdiction?”

The Law:

[ 10 ] In order to determine this issue of jurisdiction, the court must consider two tests:

(a) The real and substantial connection test ( jurisdiction simpliciter ); and

(b) Forum non conveniens .

[ 11 ] It is acknowledged by counsel that the proper application of those tests is as set out in the Ontario Court of Appeal decision of Van Breda v. Village Resorts Limited [2010] (ON C.A.).

[ 12 ] At paragraph 109 of that decision, the court summarized the approach this court must take in cases dealing with the “real and substantial connection test” and the forum non conveniens analysis:

To summarize the preceding discussion, in my view, the Muscutt test should be clarified and reformulated as follows:

• First, the court should determine whether the claim falls under rule 17.02 (excepting subrules (h) and (o)) to determine whether a real and substantial connection with Ontario is presumed to exist. The presence or absence of a presumption will frame the second stage of the analysis. If one of the connections identified in rule 17.02 (excepting subrules (h) and (o)) is made out, the defendant bears the burden of showing that a real and substantial connection does not exist. If one of those connections is not made out, the burden falls on the plaintiff to demonstrate that, in the particular circumstances of the case, the real and substantial connection test is met.

• At the second stage, the core of the analysis rests upon the connection between Ontario and the plaintiff’s claim and the defendant, respectively.

• The remaining considerations should not be treated as independent factors having more or less equal weight when determining whether there is a real and substantial connection but as general legal principles that bear upon the analysis.

• Consideration of the fairness of assuming or refusing jurisdiction is a necessary tool in assessing the strengths of the connections between the forum and the plaintiff’s claim and the defendant. However, fairness is not a free-standing factor capable of trumping weak connections, subject only to the forum of necessity exception.

• Consideration of jurisdiction simpliciter and the real and substantial connection test should not anticipate, incorporate or replicate consideration of the matters that pertain to forum non conveniens test.

• The involvement of other parties to the suit is only relevant in cases where that is asserted as a possible connecting factor and in relation to avoiding a multiplicity of proceedings under forum non conveniens.

• The willingness to recognize and enforce an extra-provincial judgment rendered on the same jurisdictional basis is as an overarching principle that disciplines the exercise of jurisdiction against extra-provincial defendants. This principle provides perspective and is intended to prevent a judicial tendency to overreach to assume jurisdiction when the plaintiff is an Ontario resident. If the court would not be prepared to recognize and enforce an extra-provincial judgment against an Ontario defendant rendered on the same jurisdictional basis, it should not assume jurisdiction against the extra-provincial defendant.

• Whether the case is interprovincial or international in nature, and comity and the standards of jurisdiction, recognition and enforcement prevailing elsewhere are relevant considerations, not as independent factors having more or less equal weight with the others, but as general principles of private international law that bear upon the interpretation and application of the real and substantial connection test.

• The factors to be considered for jurisdiction simpliciter are different and distinct from those to be considered for forum non conveniens . The forum non conveniens factors have no bearing on real and substantial connection and, therefore, should only be considered after it has been determined that there is a real and substantial connection and that jurisdiction simpliciter has been established.

• Where there is no other forum in which the plaintiff can reasonably seek relief, there is a residual discretion to assume jurisdiction. [1]

[ 13 ] Applying the foregoing to the real and substantial connection tests discloses the following. In this case, counsel conceded that a real and substantial connection could not be presumed as the case does not fall within a connection specified in Rule 17.02. The plaintiff relies on Rule 17.02(h), which does not create such a presumption.

[ 14 ] Therefore, the plaintiff bears the burden of establishing a real and substantial connection in this case.

The parties’ positions:

The connection between the forum and the plaintiff’s claim

[ 15 ] Counsel conceded that there is a very significant connection between the plaintiffs’ claim and the Province of Ontario. Both the plaintiff and her husband, Daniel Joseph Young, (the Family Law Act claimant) reside in Ontario and have done so their entire lives. All of the plaintiff’s damages and losses and all of her medical and physio treatment has occurred in Ontario. Both plaintiffs reside and work only in Ontario and did so pre- and post-accident.

The connection between the forum and the defendant

[ 16 ] Home Depot U.S.A. Inc. is associated with a large international group of associated corporations which operate box stores in approximately 2200 locations world-wide. It operates over 60 stores in Ontario alone. Its stores, including those based in the United States of America advertise into Canada. Indeed in this case, the plaintiff’s brother used Home Depot’s internet website to ascertain the best price and location of products which led the plaintiff to the Watertown, New York Home Depot store. On the one hand Home Depot U.S.A. appears to operate stores only in the US, whereas Home Depot Canada Inc. operates the stores located in Ontario. In this case the defendant argues that the Watertown Store operates only within that location and does not solicit or advertise into Ontario. The plaintiff argues that that store is part of an international organization which indeed, by way of the internet in the very least, pursues cross-border shoppers from Ontario. The plaintiff argues that the court should apply the principle of flexibility, which would be defeated by a narrow, legalistic interpretation of Home Depot as only a specific corporation that carries on the operation of stores only within the USA, in isolation from its worldwide operation, including its Ontario stores.

Fairness

[ 17 ] “Unfairness” is not, of course, the same as inconvenience. The plaintiff has acknowledged that it is a 2 hour drive from her home to the Watertown Home Depot store. The plaintiff is able to travel, as would witnesses for both the plaintiff and the defendant.

[ 18 ] The plaintiff suggests that there would appear to be nothing unfair in requiring Home Depot to defend this action in Ontario, given its substantial business presence in Ontario. It was conceded by counsel, however, that by and large, the expert witnesses (medical) are located within Ontario and there would be substantial costs incurred by the plaintiff should she require such experts to attend proceedings in New York State.

Necessary Third Parties

[ 19 ] Counsel conceded that there are currently none and no third parties are anticipated.

General Principles

[ 20 ] It was conceded by counsel that the laws of New York would be the applicable law and that, at the very least, an expert in relation to the law would be required to give evidence in an Ontario proceeding. While counsel conceded that the Ontario jurisdiction would tend to recognize a judgment rendered in New York and New York would tend to recognize a judgment rendered in Ontario, counsel for the defendant indicated that in all likelihood, should the Ontario Courts render judgment against Home Depot U.S.A. Inc., there could be, at best, a challenge in relation to enforcement of a judgment from Ontario in New York, based upon that State’s “minimum contact” principle. This, the defendant argues, could possibly create a “multiplicity of proceedings”. Such a challenge would, it was conceded, be a limited proceeding raised at the enforcement stage. Presumably, this principle of law can be raised in an Ontario proceeding through the expert contemplated above.

Analysis

Did the Respondent (plaintiffs) establish a real and substantive connection?

1. The connection between the forum and the plaintiff’s claim

[ 21 ] Given the residency of the plaintiffs and the fact that all damages and treatment were incurred within the Province of Ontario, there is a significant connection between the plaintiff’s claim and the Province of Ontario. This was conceded by counsel.

2. The connection between the forum and the defendant

[ 22 ] There is a connection between the defendant and the Province of Ontario. It is clear, as is the case with the plaintiff and her brother, that cross-border shoppers attend the Watertown store from Ontario. Indeed, the plaintiff’s brother was able to review advertising of the Watertown store by way of the internet and determined that the Watertown store had the best product and best price available. While the evidence may fall short of establishing that Home Depot U.S.A. Inc. carries on business in Ontario, it is conceded that the defendant is part of an international organization. Home Depot Canada Inc. is the entity that carries on business in Ontario. Given that they are both part of an international retailing organization, there is evidence to support a finding that the defendant’s internet advertising and membership within the international Home Depot organization, amounts to a significant connection to Ontario. Counsel for the defendant confirmed that Home Depot USA and Canada were both self-insuring.

[ 23 ] When considered as a whole, this level of activity, international business organization and presence in both Ontario and New York amounts to a significant connection with Ontario.

3. Fairness

[ 24 ] There is nothing in the evidence upon which I could conclude that it is unfair to require the defendant to defend this action in Ontario. The Home Depot organization already has a presence in Ontario and advertises into Ontario by way of its active website. Counsel could not direct me to any factor which would cause me to conclude that the defendant would suffer “unfairness” but only some “inconvenience”.

4. General Principles

[ 25 ] Counsel conceded that it could provide no evidence or law that would indicate that New York would be unwilling to enforce an extra-provincial judgment rendered on the same jurisdictional basis as that being asserted here. It would appear, that if an Ontario defendant were to engage in a comparable international retailing organization, including internet advertising and presence in an foreign jurisdiction, Ontario would recognize and enforce a judgment rendered against the Ontario defendant by the courts of that foreign jurisdiction. If an Ontario defendant were to engage in a comparable level of activity, as part of an international organization in a foreign jurisdiction, I believe Ontario would recognize and enforce a judgment rendered against the Ontario defendant by the courts of such a foreign jurisdiction.

[ 26 ] Based on all the foregoing, I have concluded that the plaintiffs have established a real and substantial connection between the forum and the plaintiff’s claim and between the forum and the defendant. The Ontario court may therefore assume jurisdiction based upon the real and substantial connection test.

Forum non conveniens

[ 27 ] The court must consider several factors in determining the most appropriate forum for this action and the existence of a more appropriate forum must be clearly established to displace Ontario as the plaintiff’s forum of choice. [2]

[ 28 ] In reviewing the factors that may be considered in determining the most appropriate forum for this action, and in particular those enumerated in the Van Breda and Muscutt [3] cases, the following are my findings:

1. The location of the majority of parties

The plaintiffs are in Ontario, and the defendant’s employees who will apparently be witnesses, are in New York. The defendant does conduct business within Ontario. Query: given the limited evidence that the defendant’s employees apparently are in a position to provide, could their evidence not be accommodated by way of video link?

2. The location of key witnesses and evidence

The plaintiff will in all likelihood be calling the larger number of witnesses, all of whom, including “medical experts”, are located in Ontario.

3. Contractual Provisions that specify applicable law or court jurisdiction

Counsel agree this is not applicable.

4. The avoidance of duplicity of proceedings

There is only this Ontario action and no other proceeding has been commenced. The issue as to whether or not New York will enforce a judgment of this court, presuming the plaintiff is ultimately successful, does not necessarily amount to a duplicity of proceedings. Rather, it would be at the enforcement stage.

5. The applicable law and its weight in comparison with the factual questions to be decided.

New York State law will apply to both liability and damages, however, it is conceded that it is similar to Ontario law. Expert evidence will be available to explain New York law. In this case however, it is conceded that liability and damages will turn on factual issues and credibility of witnesses.

6. Geographical factors suggesting a natural forum

While it is conceded that the cause of action arose in the State of New York, the defendant is part of a multi-national business with substantial connections and presence in Ontario. Most of the witnesses are located within Ontario, rather than the State of New York. Given that the alleged hazard, being a bunched up or puckered rug was conceded to be transitory, there would be no basis for viewing the site of the trip and fall in New York State.

7. Whether declining jurisdiction would deprive the plaintiff of a legitimate judicial advantage available in the Courts of Ontario

It was conceded that the plaintiff would lose the benefit of a potential costs award, including coverage for taxes on legal fees and a separate award for disbursements. (It was also conceded that this would work in favour of a successful defendant as well). It would appear that the plaintiff Daniel Joseph Young would not be able to pursue his Family Law Act claim in New York State.

[ 29 ] Having considered all of the above, I exercise my discretion and find Ontario to be the forum conveniens . Accordingly, the defendant’s motion is dismissed.

[ 30 ] The plaintiff and defendant may make submissions as to costs within 14 days of the receipt of this endorsement, if they are unable to agree as to costs. Cost submissions shall be limited to two written pages, together with applicable time dockets.

“Mr. Justice D. S. Gunsolus”

DATE RELEASED: March 27, 2012

[1] See: Van Breda v. Village Resorts Ltd. , supra, at paragraph 109

[2] See: Amchem Products Ltd. v. British Columbia (Workers’ Compensation Board) , 1993 , [1993] 1 S.C.R. 897

[3] See: Muscutt v. Courcelles (2002), 2002 , 60 O.R. (3d) 20 (Ont. C.A.)