CITATION: Algonquins of Barriere Lake First Nation v. Attorney General (Canada), 2015 ONSC 3505
COURT FILE NO.: CV-15-521027
DATE: 20150604
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N :
ALGONQUINS OF BARRIERE LAKE FIRST NATION
Plaintiff
– and –
ATTORNEY GENERAL OF CANADA, ATMACINTA HARTEL FINANCIAL MANAGEMENT CORPORATION and BDO CANADA LLP
Defendants
Sarah Clarke for the Plaintiff
Michael Beggs for the Defendant Attorney General of Canada
Craig Mills for the Defendant Atmacinta Hartel Financial Management Corporation
Jeffrey Haylock for the defendant BDO Canada LLP
HEARD: April 29, 2015
JUDGMENT RE: JURISDICTION
CHAPNIK J.:
[1] The plaintiff, Algonquins of Barriere Lake (“Barriere Lake”) commenced an action against the defendants on January 30, 2015 in this court. The defendants seek a stay of proceedings pursuant to rule 21.01(3)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 and s.106 of the Courts of Justice Act, R.S.O. 1990 c. C.43. The defendants say that the action was brought in the wrong province and thus, this court lacks jurisdiction to hear it. In the alternative, Ontario is not the appropriate or most convenient forum in which to bring the action.
[2] Both parties have filed extensive materials and numerous documents relating to their background and litigation history. The issue before me is, however, a narrow one. Does this court have jurisdiction to hear this case and if so, does the principle of forum non conveniens apply?
the facts
[3] The Barriere Lake reserve is located 134 kilometers north of Maniwaki on the shores of the Cabonga reservoir in Quebec. Its members are alleged to hunt, fish, trap and harvest on more than 10,000 square kilometers of territory in the province of Quebec.
[4] Prior to 2006, Barriere Lake received funding for the administration of the First Nation and their essential services, including health care, pursuant to a Comprehensive Funding Agreement between the Minister for Aboriginal Affairs and Northern Development Canada (the “Minister”) and Barriere Lake. The Chief and Council controlled all of these funds and designated how the funds ought to be spent.
[5] In July 2006, for various reasons, the Minister decided to take over the managing and administering of the finances of Barriere Lake, and has controlled its funding since then through successive third party management agreements (“TPM agreements”), renewable on an annual basis.
[6] The Algonquins of Barriere Lake have a long history of litigation with respect to governance and third party management. It is important to note that this case does not challenge the Minister’s decision to impose third party management on Barriere Lake, but rather, it focuses upon the alleged fiduciary duties arising from that decision and the alleged breaches of those duties.
[7] In February 2010, the Minister entered into a TPM agreement with BDO Canada LLP (“BDO”). BDO acted as manager with respect to Barriere Lake from February 2010 to March 31, 2013. The third party administrator and advisory expert for BDO were based in Winnipeg, Manitoba.
[8] The plaintiff’s assertions include an allegation that BDO’s representatives “never visited the community of Barriere Lake and had almost no face-to-face meetings with the community” and that though the representatives were based in Winnipeg, Manitoba, its head office is located in Toronto. This latter fact is disputed by BDO.
[9] With respect to the Health Canada funding, the Minister of Health and Atmacinta Hartel Financial Management Corporation, (“Hartel”) entered into a five-year contribution funding agreement from April 1, 2010 to March 31, 2015. Hartel is a financial services company whose head office is located in Ottawa, Ontario. Hartel has acted as third party manager to Barriere Lake from April 1, 2013 to March 2015. However, in late 2014, Barriere Lake requested that Hartel no longer visit the community “given its failings and its express disrespect for Barriere Lake.”
[10] The plaintiff filed this claim in the Ontario Superior Court of Justice on January 30, 2015. In its pleading, it alleges that the funding and the agreements have been mismanaged. The crux of the argument rests on allegations of breach of fiduciary duty owed by the Minister to the Algonquins of Barriere Lake pursuant to the agreements.
[11] The plaintiff alleges the following against the defendants: breaches of fiduciary duty, breaches of contract, interference with economic relations and negligent misrepresentation.
the law
[12] Rule 21.01(3)(a) provides that a defendant may move before a judge to have an action stayed or dismissed on the ground that the court has no jurisdiction over the subject matter of the action.
[13] As well, pursuant to s. 106 of the Courts of Justice Act, the court may, on its own initiative or on motion by any person, whether or not a party, stay any proceeding in the court on such terms as are considered just.
[14] As noted in the Crown’s factum, at common law the Crown could not be sued in any court: Rudolph Wolff & Co. v. Canada, 1990 139 (SCC), [1990] 1 S.C.R. 695.
[15] Jurisdiction for claims against the Crown derives from the Crown Liability and Proceedings Act, R.S.C. 1985, c. C-50 (“CLPA”). Section 21(1) of the Act states:
In all cases where a claim is made against the Crown, except where the Federal Court has exclusive jurisdiction with respect to it, the superior court of the province in which the claim arises has concurrent jurisdiction with respect to the subject matter of the claim. [Emphasis added].
[16] To determine if a court has jurisdiction simpliciter, there must be a real and substantial connection between the litigation and the forum. In a case concerning a tort, the Supreme Court in Club Resorts Ltd. v. Van Breda, 2012 SCC 17, [2012] 1 S.C.R. 572 [Van Breda] at para. 90, crafted a non-exhaustive list of presumptive factors and held that the existence of jurisdiction is assumed if the plaintiff can identify one or more of the following presumptive factors:
(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; or
(d) a contract connected with the dispute was made in the province.
[17] Where a presumptive factor does not apply, the court should not assume jurisdiction. Where a presumptive factor does apply, a party may rebut the presumption of jurisdiction by demonstrating that the presumptive connecting factor does not point to any real relationship between the subject matter of the litigation and the forum, or it only points to a weak relationship between them: Van Breda.
[18] The court is required to examine the facts surrounding the claim in light of the elements of the alleged cause of action in order to determine where the substance of the claim arose. Rowe v. Canada (Attorney General) (2004), 2004 18898 (ON CA), 186 O.A.C. 106 (C.A.) [Rowe].
[19] In evaluating or weighing the presumptive connecting factors, the court must take into account the values of fairness and efficiency to inform its assessment of the real and substantial connection.
[20] Finally, if jurisdiction simpliciter is established and not rebutted, the defendant may invoke forum non conveniens in which case the defendant has the burden to show why the court should decline to exercise its jurisdiction by:
(a) identifying another appropriate forum;
(b) establishing the connection between the litigation and the alternative forum using the real and substantial test; and
(c) demonstrating why the alternative forum is more appropriate: Van Breda at para. 103.
analysis
[21] The plaintiff contends that since Hartel and BDO were selected as third party managers, the Minister “alienated his duties to Barriere Lake and in doing so, breached his fiduciary duties.”
[22] According to the plaintiff, since this complaint is focused upon the conduct of the Minister and the decisions taken in Ontario under his authority and powers, the alleged failures rest with the federal government in Ottawa, Ontario.
[23] Moreover, both Hartel and BDO are “located” in Ontario, the third party agreements were “presumably” executed in Ontario and BDO and Hartel spent “negligible time” at Barriere Lake in Quebec.
[24] As noted, under the CLPA, in order to establish whether the court has jurisdiction over a claim, the court must determine where the substance of the claim arose. I do not agree that the substance of the plaintiff’s claim arose in Ontario and find, based on the following that the plaintiff’s claims arose in the province of Quebec:
The Barriere Lake First Nation is located entirely in Quebec and the Chiefs and Councillors must use and occupy the traditional territory: Algonquins of Barriere Lake v. Algonquins of Barriere Lake (Council), 2010 FC 160, 362 F.T.R. 285 at para. 36.
Barriere Lake receives funding for its administration and essential services pursuant to comprehensive agreements with the Minister; and these agreements incorporate clauses that interpret them in accordance with the laws of Canada and the applicable laws of the province or territory in which the programs, services and/or activities are “delivered.” It is undisputed that the programs, services and/or activities are and were delivered to Barriere Lake in Quebec.
Though the forum selection is not determinative of the question of substance, it is one factor to be considered.
BDO is a partnership that carries on business throughout Canada. The third party agreement provides a contact address for them in Winnipeg, Manitoba and notices are stipulated in the agreement to be sent to the director in Gatineau, Quebec.
The record shows that funding cheques were and are sent to addresses in Quebec.
Although the third party agreements with Hartel provide a contact address for them in Ottawa, Ontario, notices are sent to the director in Gatineau, Quebec.
[25] I have read the affidavits of the plaintiff’s representative Tony Wawati affirmed April 23, 2015 and the defendants’ representatives, Jeffrey Le Blanc of Hartel sworn April 27, 2015 and Jacques Marion of BDO affirmed April 28, 2015. I have also read the transcripts of the cross-examinations of all of the affiants held on April 28, 2015. As a result of the above, I am able to make the following findings of fact relative to the issue of jurisdiction:
Re: Hartel – while certain clerical work and payroll processing took place in its Ottawa office, Hartel fulfilled its contractual requirement to attend at Barriere Lake a minimum of two days per week to meet with Mr. Wawati, members of the band council and other community members for a four year period. After it was refused access in late 2014 it has continued to meet with Mr. Wawati or other representatives of the First Nation community on a weekly basis in Quebec in order to deliver cheques, collect expense details, timesheets and other related documents.
Re: BDO – I am satisfied that BDO’s representatives have refuted the allegation it refused to visit the community and hold almost no face-to-face meetings there. The data submitted by BDO is quite to the contrary. Moreover, the relevant financial records referable to BDO were/are held in Winnipeg (which would be neutral territory) and other documents of BDO are situated in Winnipeg and/or Quebec.
Mr. Wawati’s own evidence under oath confirms much of the above findings. For example, when asked about the visits by Hartel and its representatives, he confirmed “they were there twice a week, alternating weeks” (see Question 203). He also copied Quebec regional officials in correspondence.
[26] As regards the specific causes of action claimed by the plaintiff, assuming the plaintiff can show that a fiduciary relationship exists between Barriere Lake and the Crown, the alleged breaches of that duty are rooted in allegations of failure, that is, failure by the Minister to work with or cooperate with the plaintiff regarding its finances, to manage the plaintiff’s affairs in a professional manner, to engage the leadership, to share financial information or to develop or implement a plan to assist the plaintiff to emerge from third party management.
[27] Regarding the claim of breach of contract, although Barriere Lake is not a party to the third party management contracts, they claim breach of the employment contracts between the third party managers and the Crown, specifically failure to work or cooperate with them in the financial management of the community, to take steps to return the administration of funding for the community back to the Chief and Council of Barriere Lake, to build capacity through the preparation and implementation of a plan, to provide all required financial disclosure and to develop or share the emergence plan with Barriere Lake.
[28] These allegations of breach of fiduciary duty and breach of contract are substantially the same and it appears to me, that, to the extent they have a physical location, it is within the community of Barriere Lake, located in Quebec. This court makes no comment whatsoever on the merits of the allegations. However, in my view, the alleged losses and failures and the claimed actions and inactions of the defendants emanate from and impact the community of Barriere Lake located in the Province of Quebec.
[29] The alleged tort of interference with economic relations pertains to 15 cheques that were allegedly issued with insufficient funds to “vendors” of Barriere Lake (which the defendants deny). Nevertheless, a review of the cheques that have been located, indicate that they were sent to recipients in Quebec.
[30] Regarding the tort of negligent misrepresentation, the Ontario Court of Appeal has stated in Central Sun Mining Inc. v. Vector Engineering Inc., 2013 ONCA 601, 117 O.R. (3d) 313 at para. 30 that for the purposes of jurisdiction “the core of the tort of negligent misrepresentation is that the misrepresentation is received and acted upon” in the jurisdiction at issue.
[31] The plaintiff alleges a number of misrepresentations in its pleading and claims that they resulted in losses and damages “within the community,” including diminished capacity to manage its own affairs. Thus, any reliance to its detriment would have occurred within the community of Barriere Lake.
[32] It seems to me that any consequences of an alleged misrepresentation would have been felt by the Algonquins of Barriere Lake in the community in Quebec. The plaintiff specifically refers to the “vulnerability” of the community and its alleged “right to self-government,” a right which would be exercised within the Barriere Lake community. The record demonstrates that the plaintiff’s representatives met with the defendants’ representatives generally through their regional offices in the province of Quebec. Any data crunching elsewhere was based on the interactions of the representatives of the third party managers within the Barriere Lake community.
[33] As noted by the Court of Appeal in Rowe at para. 7, where the elements that constitute the substance of a breach of contract occurred elsewhere, the claim cannot be said to arise in Ontario “simply because one of the underlying facts took place here.” See also David S. Laflamme Construction Inc. v. Canada (Attorney General) 2014 ONCA 775, 34 C.L.R. (4th) 187 where the court stated at para. 7:
[…] In Rowe, in order to determine jurisdiction under s. 21(1) of the CLPA, this court examined where the substance of the claim occurred and found that the motion judge erred in his conclusion on that issue. The court is required to examine the facts surrounding the claim in the light of the elements of the alleged cause of action in order to decide where the substance of the claim arose.
[34] Having examined the facts surrounding the plaintiff’s claim in light of the elements of the alleged causes of action, it is clear that the substance of the claim arises in Quebec and not in Ontario.
[35] In passing, it is noted that a possibility exists for parallel proceedings in another court. I am told that the Crown has brought a Notice of Application against the plaintiff in Federal Court with respect to its compliance with s. 10 of the First Nations Financial Transparency Act, S.C. 2013, c.7.
conclusion
[36] The plaintiff has failed to satisfy its onus of demonstrating a real and substantial connection to Ontario for any of the claimed causes of action. In my view, to establish the substance of the plaintiff’s claim, it is not about where decisions are made, or where the plaintiff’s financial records are kept or even where the agreements are executed (although this factor is unclear). What really matters is that each of the claims relate to an alleged failure or loss experienced in the physical location within the Barriere Lake community located in Quebec. In the circumstances, there is, in my view, no real relationship between the subject matter of the litigation and Ontario, and no good arguable case for an Ontario court to assume jurisdiction. The defendants have rebutted any presumption of jurisdiction to my satisfaction on a balance of probabilities.
[37] Thus, I find that the plaintiff’s action was brought in the wrong forum. Pursuant to s. 21(1) of the CLPA, the superior court of the province in which the claim arises is not Ontario but rather, Quebec. This court therefore lacks jurisdiction to hear this matter.
[38] Accordingly, the motion of defendant, the Attorney General of Canada for a stay of proceedings is allowed; and an order shall issue staying this action pursuant to s. 21.01(3)(a) of the Rules of Civil Procedure and s. 106 of the Courts of Justice Act. It is therefore, unnecessary for this court to deal with the issue of forum non conveniens.
[39] Costs are awarded to the defendant, the Attorney General of Canada, in the agreed amount of $2,000 inclusive of disbursements and HST. I make no comment whatsoever on the merits of the plaintiff’s claims and nothing said herein should be construed as my having done so.
[40] Finally, I express appreciation to all counsel for their clear and thoughtful submissions.
CHAPNIK J.
RELEASED: June 4, 2015
CITATION: Algonquins of Barriere Lake First Nation v. Attorney General (Canada), 2015 ONSC 3505
COURT FILE NO.: CV-15-521027
DATE: 20150604
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N :
ALGONQUINS OF BARRIERE LAKE FIRST NATION
Plaintiff
– and –
ATTORNEY GENERAL OF CANADA, ATMACINTA HARTEL FINANCIAL MANAGEMENT CORPORATION and BDO CANADA LLP
Defendants
REASONS FOR JUDGMENT
CHAPNIK J.
RELEASED: June 4, 2015