ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 09-12253
DATE: 2013-12-05
B E T W E E N:
Leeann Mitchell
Jessica Harrison, for the Plaintiff
Plaintiff
- and -
Sara Jeckovich, Diana Jeckovich and Pembridge Insurance Company
Christopher Missiuna, for the Defendant Pembridge Insurance Company
Jasdeep Bal, for the Defendants Jeckovich
Defendants
HEARD: July 17, 2013
The Honourable Madam Justice J. A. Milanetti
REASONS FOR JUDGMENT
BACKGROUND
[1] The moving parties, Sara Jeckovich and Diana Jeckovich, seek an Order dismissing the action as against them, on the grounds that Ontario does not have jurisdiction simpliciter. Alternatively, they seek an order staying the action on the grounds that Ontario is forum non conveniens.
[2] This personal injury action arose when the plaintiff, Leeann Mitchell, was involved in a motor vehicle accident in the City of Niagara Falls, New York on June 9th, 2007. Ms. Mitchell claims general damages and economic loss deriving from an inability to return to full-time hours of employment as a result of her injuries. Her prayer for relief exceeds $1,000,000
[3] The original statement of claim, issued on June 9th, 2009, in the Superior Court of Ontario, named “Janet Driver” and Pembridge Insurance (“Pembridge”) as defendants. The statement of claim was amended on August 6th, 2010 to name Sara Jeckovich and Diana Jeckovich as defendants in lieu of “Janet Driver”. Sara Jeckovich was operating the vehicle owned by her mother, Diana Jeckovich, at the time of the collision.
[4] I understand that at all material times, the Jeckovich defendants were residents of the State of New York, in the United States of America, and have never resided or carried on business in Ontario or elsewhere in Canada.
[5] The third defendant, Pembridge, is the plaintiff’s own insurer. Pembridge is headquartered in Ontario, and provides motor vehicle collision insurance in Alberta, Ontario, New Brunswick, and Nova Scotia. The plaintiff’s claim against Pembridge is made relying on the underinsured motorist coverage provisions of her automobile insurance policy.
[6] Pembridge initially filed a third-party claim against Sara Jeckovich. On July 4th, 2013, Pembridge amended their statement of defence to include cross-claims against co-defendants Sara Jeckovich and Diana Jeckovich. Pembridge did not proceed with the third party claim.
[7] I also note that Pembridge’s amended statement of defence deletes paragraphs 3, 4 and 5. These paragraphs challenged the jurisdiction of the Ontario Court on the grounds that there is no real and substantial connection with the province of Ontario, and that Ontario is not the forum conveniens for this litigation. I note that these former pleadings very much mirror the position of the moving party on this motion.
[8] It is clear from the evidence before me that no claim has been commenced in New York State, and that the limitation period to bring such a claim (three years) has expired.
EVIDENCE ON THE MOTION
[9] The plaintiff, Ms. Mitchell, claims general damages and economic loss deriving from an inability to return to full-time hours of employment. Her prayer for relief exceeds $1,000,000.
[10] While the plaintiff submits that liability is not at issue, the defendants have not conceded this point. That being said, the Jeckovich defendants have yet to file a defence.
[11] The plaintiff claims economic hardship if she were required to pursue a claim in New York State.
[12] Ms. Mitchell sets out all of her expenses and her limited annual income. She discusses the personal exposure associated with retaining a New York State attorney, and the expense attached to her being required to spend weeks in New York State to try the case.
[13] Ms. Mitchell claims that she would be prejudiced by her financial situation, thus losing the right to proceed with her claim on its merits.
[14] Both Ms. Mitchell’s affidavit and that of Mr. DiVincenzo for Pembridge, address the status of the Jekovich insurer, the Government Employees Insurance Company (“GEICO”). Both point to a list of insurers – which included GEICO, that have signed a property damage undertaking. The Pembridge affidavit of Mr. DiVincenzo states as well, that GEICO has made undertakings to the Financial Services Commission of Ontario (FSCO) that its third party limits could be considered to be $200,000.
[15] Mr. DiVincenzo also deposes that GEICO has filed several undertakings to agree to be governed by many conditions of the Insurance Act in Ontario. These allow GEICO to maintain their status as a protected defendant. In exchange, GEICO has agreed to be bound by the laws of Ontario.
[16] I note that there are a significant number of insurers listed as signatories to this document. Mr. DiVincenzo suggests that based on these documents, GEICO has at least contemplated responding to claims in the province of Ontario.
[17] Sara Jeckovich and Diana Jeckovich filed separate affidavits confirming they are American citizens with no business holdings in Canada. Neither had any familiarity with the plaintiff prior to the accident. They confirm policy limits of $100,000.
[18] Additionally, two affidavits of New York State attorney Mr. Daniel Archilla were filed in support of the Jeckovich defendants. Mr. Archilla states that New York civil law precludes a U.S. citizen residing in New York from commencing an action in New York against a Canadian citizen if the accident occurred in Canada and the requisite connection to New York is not present.
[19] Moreover, Mr. Archilla provides that under New York’s Civil Practice Law and Rules, unless personal jurisdiction is recognized in relation to a foreign judgment, the judgment will not be enforceable. Mr. Archilla deposes that given the circumstances of this case, judgment against the defendants would not be enforceable if obtained in Canada.
LEGAL FRAMEWORK
[20] As articulated by the Supreme Court of Canada in Club Resorts Ltd. v. Van Breda, [2010] S.C.J. No. 17 (“Van Breda”), the party arguing that the court should assume jurisdiction has the burden of identifying a presumptive connecting factor that links the subject matter of the litigation to the forum.
[21] In order to facilitate order and fairness in the resolution of conflicts between different jurisdictions, the Court in Van Breda identified the following four presumptive connecting factors that entitle a court to assume jurisdiction in a case concerning a tort:
(a) That 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.
(Van Breda, para. 90)
[22] It is clear from the Supreme Court that this list of presumptive factors is not closed; new factors might be developed over time which could also presumptively entitle a court to assume jurisdiction.
[23] The Supreme Court of Canada warns, however, that the framework for assuming jurisdiction mustn’t be an unstable or ad hoc system based on the circumstances of a particular case. The principles and rules at the core of the framework must be maintained to ensure security and predictability in the law governing the assumption of jurisdiction by a court.
[24] At paragraph 93 of the Van Breda decision, the Court states:
If, however, no recognized presumptive connecting factor — whether listed or new — applies, the effect of the common law real and substantial connection test is that the court should not assume jurisdiction. In particular, a court should not assume jurisdiction on the basis of the combined effect of a number of non-presumptive connecting factors. That would open the door to assumptions of jurisdiction based largely on the case-by-case exercise of discretion, and would undermine the objectives of order, certainty and predictability that lie at the heart of a fair and principled private international law system.
[25] If a court decides that none of the presumptive connecting factors have been established, it must dismiss or stay the claim, subject to the possible application of the forum of necessity doctrine.
[26] Even if jurisdiction is established, however, such may be rebutted, if the party challenging jurisdiction raises an issue of forum non conveniens. The Jeckovich defendants have done so in the case at bar. If jurisdiction is established, the Jeckovich defendants bear the onus of proving why this court should decline to exercise its jurisdiction, and displace the forum chosen by the plaintiff. This requires identifying what connections the alternative forum has with the subject matter of the litigation. The courts have held that the moving party must show that the alternative forum is “clearly more appropriate” (Van Breda, para. 108).
[27] At the end of the day, however, forum non conveniens will only come into play once jurisdiction has been established by proof of at least one of the four articulated presumptive connecting factors, or a new factor that is consistent with the Court’s decision in Van Breda.
ANALYSIS
[28] In the case before me, it is clear that the first three presumptive connecting factors cannot be established. The Jeckovich defendants neither live nor carry on business in Ontario. It is similarly clear that the tort was committed outside of the province, in New York State.
[29] The plaintiff’s claim is made relying on a contract for underinsured motorist insurance issued to the plaintiff by Pembridge, which provides protection if the plaintiff is injured by a motorist with insurance of less than $1 million. The defendants, Sara Jeckovich and Diana Jeckovich, were insured by a policy of insurance with GEICO in New York, with a policy limit of $100,000.
[30] Each of the parties relies upon case law dealing with jurisdiction both pre and post the Supreme Court’s Van Breda decision. Several of these cases dealt with the inclusion of insurers providing uninsured and underinsured motorist coverage, such as Pembridge.
[31] Does inclusion of an Ontario insurer as a defendant tip the jurisdictional scales? Does that mean that accidents anywhere in the world might be pursued in Ontario so long as one’s own insurer is involved as the result of unsatisfactory policy limits in the corresponding State? Given the very extensive lists of insurers that are signatories to the FSCO undertaking, it would appear that such would be the case if this logic holds. Was this the intention of the Supreme Court of Canada in framing the fourth presumptive connecting factor which asks if a contract connected with the dispute was made in the province?
[32] I was provided with case law that went both ways on this issue at the Superior Court level. I reviewed each of those cases, as well as several decisions of our Court of Appeal, often penned by Justice Sharpe, on this specific point. I note that the Court of Appeal decisions predate Van Breda, and in fact are referenced substantially by the Supreme Court of Canada.
[33] Justice Edwards’ decision in Cesario v. Gondek et al. 2012 ONSC 4563 (“Cesario”), which held that Ontario was the appropriate jurisdiction, is relied upon heavily by the responding plaintiffs and Pembridge. I find this case distinguishable on its facts.
[34] In Cesario, the plaintiffs were the husband driver and passenger wife who both lived in Ontario. They were involved in two motor vehicle accidents four weeks apart – the first in New York and the second in Ontario. Damages were claimed for injuries sustained from both collisions, within the same action, as the injuries and damages resulting from the two collisions could not, it was argued, be separately identified and assessed (Cesario, para. 12). In addition to a claim against the Ontario insurer, the wife commenced a separate action against her husband, the driver of the vehicle during both accidents.
[35] The court held, in accordance with Van Breda, that as there were multiple defendants, at least one of whom was resident in Ontario, there was a sufficient real and substantial connection for Ontario to assume jurisdiction over all aspects of the case (Cesario, para. 28).
[36] This case is quite different from the case before me. In Cesario, one accident occurred in New York and the other in Ontario. Therefore, the tort action involved both an Ontario and New York defendant. This in itself provides a sufficient “real and substantial” connection as defined in Van Breda.
[37] The decisions of Justice Perell in Misyura v. Walton, 2012 ONSC 5397 (“Misyura”), and Justice Lederer in Paraie et al. v. Cangemi et al., 2012 ONSC 6341 (“Paraie”), in particular, are quite similar factually to the case before me for consideration. Both cases deal with Canadians visiting New York State when the accident occurred. In both scenarios, the plaintiff sued the New York driver, as well as their own automobile insurer, relying on the uninsured and underinsured motorist coverage in the policy.
[38] In Misyura, Justice Perell also had before him the opinion of a New York attorney setting out the New York jurisdictional rules, and stating that a New York court would not enforce judgment granted in Ontario against a New York defendant (as in Mr. Archilla’s affidavits before me).
[39] What resonated with me most significantly was Justice Perell’s reliance on Justice Sharpe’s decision in Gajraj v. DeBernardo 2002 44959 (ON CA), 2002 60 O.R. (3d) 68 CA (“Gajraj”). At paragraph 20 of that decision Justice Sharpe states:
…the core of the claim is against the New York defendants and the claim against the Ontario defendant [and insurer] is entirely secondary and contingent. Jurisdiction over claims against extra-provincial defendants should not be bootstrapped by such a secondary and contingent claim against a provincial defendant.
[40] Accordingly, Justice Sharpe held in Gajraj that the involvement of the Ontario insurer did not favor assuming jurisdiction against the New York defendants.
[41] In coming to the same conclusion in Paraie, Justice Lederer refers to the contract between the Ontario insurer and the plaintiff as secondary and contingent. Justice Lederer goes on to state at paragraph 13:
The contract will be called on only if the damages awarded exceed the limits of the policy available in New York. For the court to be asked, at this stage, to examine the damages and to draw a conclusion as to the likely magnitude of the award only underscores the speculative nature of the investigation the court is being asked to undertake and the contingent character of any possible liability that would extend to the Canadian insurer.
[42] I also read carefully Justice Sharpe’s decision in Doiron v. Bugge 2005 36252 (ON CA), 2005, 258 DLR (4th) 716 (Ont. C.A.), which went the other way finding jurisdiction in Ontario for a tort involving a New York defendant. In that case, the plaintiff had gone as a volunteer to assist with the 9-11 aftermath. She was being driven in this capacity by her supervisor, the defendant Bugge. Justice Sharpe found that:
The fact that the respondent and the appellant had a relationship that existed prior to and independent of the accident distinguishes this case from Gajraj where the parties were strangers prior to the accident.
(para. 11)
Justice Sharpe goes on to say that:
[This factor] …does tend to neutralize what otherwise would be a factor favouring the appellant, and it makes the case for assuming jurisdiction stronger here than it was in Gajraj.
(para. 12)
[43] Given the guidance of Justice Sharpe in Gajraj, and its application in Misyura and Paraie, I do not accept that Ms. Mitchell’s contract with her Ontario insurer is a sufficient connecting factor to impose jurisdiction in Ontario.
[44] I do not accept that the plaintiff or Pembridge have established that Ontario is the appropriate jurisdiction to deal with this matter. Given this finding, I do not need proceed with an analysis of forum non conveniens.
[45] The thorny issue in the case before me is the passage of the New York limitation period. It is clear that if this case were to be dismissed for lack of jurisdiction, the plaintiff’s American action would be statute barred, and she would be left with a $100,000 deductible in her contract dispute with Pembridge with no means to fill that gap. Does this amount to necessity such that this court must assume jurisdiction even if the real and substantial test has not been satisfied?
[46] The Court of Appeal’s commentary on the forum of necessity doctrine in Van Breda v. Village Resorts Ltd., 2010 ONCA 84, was left largely untouched by the Supreme Court. The Court of Appeal wrote the following on this doctrine at paragraph 100:
…The forum of necessity doctrine recognizes that there will be exceptional cases where, despite the absence of a real and substantial connection, the need to ensure access to justice will justify the assumption of jurisdiction. The forum of necessity doctrine does not redefine real and substantial connection to embrace “form of last resort” cases; it operates as an exception to the real and substantial connection test. Where there is no other forum in which the plaintiff can reasonably seek relief, there is a residual discretion to assume jurisdiction. In my view, the overriding concern for access to justice that motivates the assumption of jurisdiction despite inadequate connection with the forum should be accommodated by explicit recognition of the forum of necessity exception rather than by distorting the real and substantial connection test.
[47] The only case provided to me by counsel was the decision of Justice Kenneth Campbell in Elfarnawani v. International Olympic Committee and Ethics Commission, 2011 ONSC 6784 (“Elfarnarwani”). In that decision, Justice Campbell denied jurisdiction, and went on to consider the missed limitation period as a potential basis for the forum of necessity analysis.
[48] In Elfarnawani, Justice Campbell was unable to conclude that there was no other forum in which the plaintiffs could reasonably seek relief. I do not have that situation. I have been persuaded that a New York action would be barred at this stage.
[49] That being said, I do not accept that I should be relying on a perhaps tactical decision on the part of plaintiff’s counsel not to commence an action in the appropriate jurisdiction, to engage the forum of necessity doctrine and assume jurisdiction despite the absence of a real and substantial connection. I do not believe that a missed limitation period, which I add could have been avoided, is an exceptional circumstance warranting the use of residual discretion. To borrow language from the Supreme Court in Van Breda, doing so, I believe, would “undermine the objectives of order, certainty and predictability that lie at the heart of a fair and principled private international law system” (Van Breda, para. 93).
CONCLUSION
[50] For the reasons referred to herein, the motion is granted. The action against the moving parties, Sara Jeckovich and Diana Jeckovich, is dismissed.
[51] My costs decision will follow in short order.
Released: December 5, 2013 ___________________________
MILANETTI J.
COURT FILE NO.: 09-12253
DATE: 2013-12-05
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Leeann Mitchell
Plaintiff
- and –
Sara Jeckovich, Diana Jeckovich and Pembridge Insurance Company
Respondents
REASONS FOR JUDGMENT
Milanetti J.
JAM:mg
Released: December 5, 2013