Colavecchia et al. v. The Berkeley Hotel Limited

[Indexed as: Colavecchia v. Berkeley Hotel Ltd.]

112 O.R. (3d) 287
2012 ONSC 4747

Ontario Superior Court of Justice

Goldstein J.
August 17, 2012

Conflict of laws -- Jurisdiction -- Real and substantial connection -- Ontario-resident plaintiff booking room in boutique hotel located in London, England through TD Visa Travel Rewards website and paying for room by redeeming travel points -- Plaintiffs suing hotel in Ontario for negligence after plaintiff was injured in fall in hotel room -- Action dismissed for lack of jurisdiction -- No real and substantial connection with Ontario -- Defendant having no office or other premises in Ontario -- Mere fact that plaintiff booked room through TD Travel Rewards website not meaning that defendant carried on business in Ontario -- Plaintiff not entering into contract with defendant in Ontario.

The defendant was a boutique hotel located in London, England. The female plaintiff booked a room at the hotel through the TD Visa Travel Rewards website and paid by redeeming travel points. The male plaintiff was injured when he slipped and fell in the bathroom of their hotel room. The plaintiffs sued the defendant in Ontario for damages for negligence. The defendant brought a motion to dismiss the action for lack of jurisdiction.

Held, the motion should be granted.

The defendant had no office or other premises in Ontario, and there was no evidence that it engaged in a marketing campaign to specifically target Ontario residents. The fact that the female plaintiff booked a room through the TD Visa Travel Rewards website did not mean that the defendant carried on business in Ontario. The website was nothing more than a search engine for those who wanted to use their travel points. The female plaintiff did not enter into a contract with the defendant in Ontario. Rather, the contract was with TD Visa Travel Rewards. It did not appear that there was any connection or negotiation between the plaintiffs and the defendant until the plaintiffs checked in.

MOTION to dismiss an action for lack of jurisdiction.

Cases referred to
Club Resorts Ltd. v. Van Breda, [2012] S.C.J. No. 17, 2012 SCC 17 , 291 O.A.C. 201, 2012EXP-1452, J.E. 2012-788, EYB 2012-205198, 429 N.R. 217, 343 D.L.R. (4th) 577, 212 A.C.W.S. (3d) 712, 91 C.C.L.T. (3d) 1, 10 R.F.L. (7th) 1, 17 C.P.C. (7th) 223, apld
Noble v. Carnival Corp. (2006), 80 O.R. (3d) 392, [2006] O.J. No. 1430, [2006] O.T.C. 336, 24 C.P.C. (6th) 124, 147 A.C.W.S. (3d) 216, 2006 11441 (S.C.J.) ;
Sidlofsky v. Crown Eagle Ltd., [2002] O.J. No. 4152, [2002] O.T.C. 833, 2002 10208 , 117 A.C.W.S. (3d) 721 (S.C.J.), consd [page288]
Other cases referred to
Muscutt v. Courcelles (2002), 2002 44957 (ON CA) , 60 O.R. (3d) 20, [2002] O.J. No. 2128, 213 D.L.R. (4th) 577, 160 O.A.C. 1, 13 C.C.L.T. (3d) 161, 26 C.P.C. (5th) 206, 114 A.C.W.S. (3d) 634 (C.A.)

Statutes referred to
Innkeepers Act, R.S.O. 1990, c. I.7

Authorities referred to
Fridman, G.H.L., The Law of Contract in Canada, 6th ed. (Toronto: Carswell, 2011)

Michael A. Cohen, for plaintiffs.
Susan Keenan, for defendant.

[1] GOLDSTEIN J.: -- The plaintiffs live in Toronto. In February 2011, they decided to book a short holiday in the United Kingdom. The plaintiff Christene DeGasperis, using her TD Visa card, made a reservation online for the defendant, Berkeley Hotel in London (the "hotel"), a very upscale establishment. On October 26, 2011, the plaintiffs checked into the hotel. The next day, the plaintiff Sandro Colavecchia, Ms. DeGasperis' husband, was injured when he slipped and fell in the bathroom of their hotel room. Ms. DeGasperis called for a taxi and transported him to a hospital, where he was treated for his injuries. The plaintiffs returned to Ontario the next day. Mr. Colavecchia has been under the treatment of an Ontario doctor for the injuries he has sustained. He is a chef. He runs his own catering business. He claims that he has lost income and enjoyment of life as a result of his injuries.

[2] The plaintiffs have sued the hotel in Ontario. The hotel has not yet filed a defence. Instead, the hotel brings a motion to dismiss the action for lack of jurisdiction in the Superior Court of Ontario. I agree that there is no real and substantial connection with Ontario. Although it is not necessary for me to decide this point, even had I found that there is jurisdiction in this court, I would still have dismissed the action on the basis that the United Kingdom is the proper forum for the litigation. Accordingly, the hotel's motion is granted and the action is dismissed for the reasons that follow.

[3] The courts of Ontario will have jurisdiction on the basis of objective factors that connect the legal situation or the subject matter of the litigation with the forum: Club Resorts Ltd. v. Van Breda, [2012] S.C.J. No. 17, 2012 SCC 17 , at para. 82 . The [page289] objective factors identified by the Supreme Court of Canada are as follows (Van Breda, at para. 90 ): (a) the defendant is domiciled or resident in the province; (b) the defendant carries on business in the province; (c) the tort was committed in the province; and (d) a contract connected with the dispute was made in the province.

[4] In my view, none of these factors applies. The plaintiffs do not suggest that the hotel was domiciled or resident in Ontario, or that the tort was committed in Ontario (although they argue that by reason of Mr. Colavecchia's injuries he has sustained damages in Ontario). The plaintiffs rely on the presumptive connecting factors that the defendant carries on business in the province, and that a contract connected with the dispute was made in the province.

[5] The plaintiffs rely on two cases that were decided prior to Van Breda. In Noble v. Carnival Corp. (2006), 80 O.R. (3d) 392, [2006] O.J. No. 1430, 2006 11441 (S.C.J.) , the plaintiff was employed as a tour manager with Seabourn Cruise Line. She was assigned to work on a Cunard ship. While the ship was docked in St. Petersburg, Russia, she was injured in an automobile accident during a site inspection. She sued the various defendants in Ontario. None of the defendants was an Ontario corporation. Sachs J. applied the test set out by the Court of Appeal in Muscutt v. Courcelles (2002), 2002 44957 (ON CA) , 60 O.R. (3d) 20, [2002] O.J. No. 2128 (C.A.) and found that Ontario had jurisdiction.

[6] I have some doubts as to whether Sachs J. would have decided Noble the same way in 2012 as she did in 2006, given the Supreme Court's extensive changes to the test for jurisdiction. For example, in following Muscutt, Sachs J. found that since the plaintiff lived in Ontario and received most of her medical treatment in Ontario, she had suffered pain and suffering in Ontario. That was an element of the Muscutt test. The Supreme Court in Van Breda very specifically rejected damages as a presumptive connecting factor (para. 89):

The use of damage sustained as a connecting factor may raise difficult issues. For torts like defamation, sustaining damage completes the commission of the tort and often tends to locate the tort in the jurisdiction where the damage is sustained. In other cases, the situation is less clear. The problem with accepting unreservedly that if damage is sustained at a particular place, the claim presumptively falls within the jurisdiction of the courts of the place, is that this risks sweeping into that jurisdiction claims that have only a limited relationship with the forum. An injury may happen in one place, but the pain and inconvenience resulting from it might be felt in [page290] another country and later in a third one. As a result, presumptive effect cannot be accorded to this connecting factor.

[7] In any event, the facts in Noble are very distinguishable from the facts here. The plaintiff in Noble had an employment relationship with at least one of the defendants, which Sachs J. deemed of some importance.

[8] The plaintiffs also rely on Sidlofsky v. Crown Eagle Ltd., [2002] O.J. No. 4152, 2002 10208 (S.C.J.) . In that case, the plaintiff was injured at a Holiday Inn in Jamaica. He sued the Holiday Inn, a Tennessee corporation, as well as Sunquest, the Ontario tour operator from whom the package holiday had been purchased. It appears that Sunquest merely argued forum non conveniens, but Holiday Inn argued that Ontario had no jurisdiction. Backhouse J. found that Ontario had jurisdiction as Holiday Inn had been the agent for Sunquest in Jamaica. As well, it had an indemnity agreement and advertised in Ontario.

[9] I also have some doubts as to whether Backhouse J. would have decided Sidlofsky the same way in 2012 as in 2002 given the Supreme Court's decision in Van Breda. For example, the Supreme Court commented, at para. 87, that active advertising in the jurisdiction or access to a website would not be enough to establish that a defendant was carrying on business. In any event, Sidlofsky is distinguishable from the facts in this case. Like Dr. Charron, the Sidlofsky's purchased a package holiday from an Ontario tour operator, which was responsible for all aspects of the Sidlofsky's stay in Jamaica.

[10] There is no doubt that Noble and Sidlofsky were good law prior to Van Breda. I do not believe the plaintiffs are right to rely on them now.

[11] I turn now to determining whether the presumptive connecting factors relied on by the plaintiffs can be applied here. Does the Hotel Carry on Business in Ontario?

[12] In order to understand the plaintiffs argument that the hotel carries on business, it is necessary to set out some further facts. Ms. DeGasperis booked the hotel through the TD Visa Travel Rewards website. She logged on, conducted a search for a hotel in London, and based on the results she selected the hotel. The electronic invoice indicates that Ms. DeGasperis booked the Berkeley Hotel in Knightsbridge, London, on February 1, 2011 for a stay from October 26 to October 30, 2011. She paid for the hotel by redeeming travel points worth $2,500. Since the total bill for the hotel was $2,571.18, her TD Visa card was charged $71.18. Mr. Cohen argues that the hotel carries on [page291] business in Ontario by virtue of its connection with the TD travel rewards website.

[13] As I noted earlier, the hotel is located in London, in the United Kingdom. London is its only location. It has no office or other premises in Ontario. There was no evidence that hotel employees regularly visit Ontario or that the hotel engaged in a marketing campaign to specifically target Ontario residents.

[14] In Van Breda, Ms. Van Breda was injured while on holiday in Cuba at a resort managed by Club Resorts. Her husband, Victor Berg, was a professional squash player. Mr. Berg did not have a typical tourism arrangement. He had an arrangement with Club Resorts where he would provide two hours of tennis lesson per day in exchange for room and board for him and his spouse at the hotel. The arrangement had been made via one Mr. Denis (another defendant), who specialized in recruiting professionals for Club Resorts and others. In the companion case, Charron, the plaintiff was a doctor who had drowned while scuba diving at one of Club Resorts' properties.

[15] The court found in both cases that Club Resorts was carrying on business in Ontario. In the case of Ms. Van Breda's husband, he entered into a special contract specifically aimed at recruiting racquet professionals. For the purposes of the Charron matter, the court found that Club Resorts specifically marketed to Ontario residents. Indeed, a significant amount of its business came from holiday travellers from Ontario. As well, Club Resorts had the physical benefit of an office in Ontario and its employees frequently travelled to Ontario for business purposes. In other words, Club Resorts was specifically in the business of marketing and organizing tours from wintery Ontario to its properties in the sunny Caribbean.

[16] In this case, the hotel does not have an office or employees in Ontario. There is no evidence that it markets specifically to Ontario residents. The hotel was one of many hotels that came up on the TD Visa Travel Rewards website. The TD Visa Travel Rewards website seems nothing more than a search engine for those who want to use their travel points -- on any hotel that has a relationship with TD Visa Travel Rewards. The plaintiffs provided a screenshot of their search result for hotels in London. The search resulted in dozens of hotels.

[17] At best, TD Visa Travel Rewards is merely a booking agent of the hotel. I do not think that is enough to create the principal-agent relationship that the plaintiffs suggest. I think it is quite obvious that a boutique hotel in a foreign jurisdiction would make it possible to book through websites like TD Visa Travel Rewards specifically so that it does not have to carry on [page292] business in a foreign jurisdiction. Since the Web is everywhere, on the plaintiff's theory, every hotel in the world that can be booked through the Web does business everywhere. If the interaction between Ms. DeGasperis and the hotel through a Canadian booking website was enough to be "carrying on business", it would amount to a form of universal jurisdiction. I point to the Supreme Court's statement, at para. 87 of Van Breda:

Carrying on business in the jurisdiction may also be considered an appropriate connecting factor. But considering it to be one may raise more difficult issues. Resolving those issues may require some caution in order to avoid creating what would amount to forms of universal jurisdiction in respect of tort claims arising out of certain categories of business or commercial activity. Active advertising in the jurisdiction or, for example, the fact that a Web site can be accessed from the jurisdiction would not suffice to establish that the defendant is carrying on business there. The notion of carrying on business requires some form of actual, not only virtual, presence in the jurisdiction, such as maintaining an office there or regularly visiting the territory of the particular jurisdiction. But the Court has not been asked in this appeal to decide whether and, if so, when e-trade in the jurisdiction would amount to a presence in the jurisdiction.

[18] The evidence is clear that Ms. DeGasperis merely accessed a website. It is true that the court left the door open to e-trade, but it strikes me that this is the type of case that the Supreme Court had in mind when it stated that mere access to a website is not sufficient to establish that a defendant carries on business.

[19] Accordingly, I find that the hotel does not carry on business in Ontario. Was a Contract Connected with the Dispute Made in Ontario?

[20] Mr. Cohen's argument that the hotel carries on business in Ontario is intimately connected to the argument that the contract connected with the dispute was made in Ontario. He argues that by logging into the TD Travel Rewards website, the plaintiff Ms. DeGasperis made a contract with the hotel in Ontario. I disagree. My reading of the electronic invoice is that, at best, the plaintiffs had a contract with TD for TD to make a booking with the hotel.

[21] In order for there to be a valid contract, the elements of offer, acceptance and consideration must be present: G.H.L. Fridman, The Law of Contract in Canada, 6th ed. (Toronto: Carswell, 2011).

[22] The offer, acceptance and intention all indicate privity of contract between TD Visa Travel Rewards and the plaintiffs. I do not see any offer and acceptance between the hotel and the plaintiffs -- I do see it between TD Visa and the plaintiffs. It [page293] does not seem that there was any connection or negotiation between the plaintiffs and the hotel until the plaintiffs checked in. As for consideration, the plaintiffs largely paid with TD Travel Rewards points that were obviously accumulated with a TD Visa card. I think it is obvious that the plaintiffs collected TD travel rewards points so that they could use them through the TD Visa Travel Rewards service. I seriously doubt (and certainly there was no evidence to suggest) that the plaintiffs points could be redeemed directly with the hotel. The remainder of $78.18 was paid in Canadian dollars. It may be that the actual contract was between the plaintiffs and the hotel, but the one-page electronic invoice does not show that. I think it is a much stronger argument that the contract was formed when the plaintiffs actually checked into the hotel in London and that the legal aspects of their stay was governed by the U.K. equivalent of the Innkeeper's Act, R.S.O. 1990, c. I.7 .

[23] Even if there was a contract that was entered into between the hotel and the plaintiffs in Ontario, it was merely for accommodations. The contract has nothing to do with the dispute between the parties, which is a classic action for negligence. Accordingly, I find that there was no contract connected with the dispute that was created in Ontario. Forum Non Conveniens

[24] The parties contest whether Ontario is the proper jurisdiction for this case, even if I were to find that there is jurisdiction. Since I have decided that there is no jurisdiction, it is not necessary for me to decide this point. Had I found jurisdiction, I would still have granted the motion as I have no hesitation in saying that the United Kingdom is the appropriate jurisdiction. Disposition

[25] The motion is granted and the action is dismissed with costs to the moving party. If the parties are unable to agree on an amount, the defendant hotel may file submissions within 14 days of this judgment. The responding plaintiffs may file submissions after a further ten days.

Motion granted.