ONTARIO

SUPERIOR COURT OF JUSTICE

BARRIE COURT FILE NO.: 10-0511

DATE: 20151221

BETWEEN:

Gary Cook and Jennifer Corswandt
Plaintiffs

– and –

1293037 Alberta Ltd. operating as Traveller’s Cloud 9
Defendant

A.R. Kerr, for the Plaintiffs

D.W. Powrie, for the Defendant

HEARD: November 30, 2015

REASONS FOR DECISION

MULLIGAN J.:

[1] The plaintiff, Gary Cook, commenced an action in Ontario as a result of an accident which allegedly occurred while he was residing in the defendant’s hotel in Whitecourt, Alberta. The defendant moves to stay the Ontario action on the basis that this action has no real and substantial connection to Ontario, Alberta being the more appropriate forum for this action.

[2] The following timelines will assist and provide context for the discussion that follows:

May 9, 2008

Gary Cook alleges that he suffered injuries as a result of a slip and fall while he was a guest at the defendant’s hotel in Whitecourt, Alberta.

July 25, 2008

The plaintiffs’ Ontario counsel puts the defendant on notice of a claim. The notice does not indicate which forum, Alberta or Ontario, that the plaintiffs might choose.

May 7, 2010

The plaintiffs commence their action in Ontario. The plaintiff, Jennifer Corswandt, is the spouse of Gary Cook.

May 9, 2010

Two years have elapsed since the plaintiff’s alleged accident at the defendant’s Alberta hotel.

August 6, 2010

Counsel for the defendant puts the plaintiffs’ counsel on notice that it will bring a motion to stay the Ontario proceeding.

August 19, 2010

The plaintiffs serve their claim on the defendant corporation at Whitecourt, Alberta.

January 12, 2011

The defendant commences its motion to stay the Ontario action.

[3] The return of the defendant’s motion was adjourned on consent while cross-examinations were conducted. It was subsequently adjourned on terms making it peremptory on the plaintiffs.

[4] It is not disputed that both Ontario and Alberta had the same two-year limitation period with respect to negligence claims.

[5] At the time of the accident, the plaintiff, Gary Cook, was a temporary worker, working in Alberta for Steeplejack Corporation. He was a union employee. His employer, Steeplejack, arranged his hotel accommodation at the defendant hotel. Gary Cook claims that while taking a shower, the water turned inexplicably hot, scalding him and forcing him to jump out of the shower. He was taken by ambulance and provided with emergency care. He subsequently returned to Ontario and alleges that his injuries were determined to be far worse and he required back surgery. His subsequent medical attention and recovery was in Ontario.

[6] The defendant argues that Alberta is the appropriate forum. The alleged injuries occurred at a hotel where Mr. Cook was a guest. The issues of liability and damages are at play. Most of the liability witnesses reside in Alberta. Some of the damages witnesses also reside in Alberta, including initial healthcare providers.

The Law

[7] The defendant submits that Ontario does not have jurisdiction simpliciter. Alternatively, Ontario is not forum conveniens. The plaintiffs argue that Ontario does have jurisdiction simpliciter, or in the alternative, it is the forum of necessity.

[8] Both parties acknowledge the important reformulation of the law by the Supreme Court of Canada in Club Resorts Ltd. v. Van Breda, 2012 SCC 17, 2012 S.C.C. 17. The principles were restated by Perell J. in Forsythe v. Westfall, 2015 ONSC 758 at paras. 10 and 11:

[10] The test for whether an Ontario Court has jurisdiction simpliciter is whether there is a real and substantial connection between the matter, the parties, and Ontario.

[11] In Van Breda, in the context of tort claims, the Court identified four presumptive factors that would establish a real and substantial connection and jurisdiction simpliciter: (1) the defendant is domiciled or resident in the province; (2) the defendant carries on business in the province, (3) the tort was committed in the province; and (4) a contract connected with the dispute was made in the province.

[9] The plaintiffs submit that there is some evidence that the defendant was domiciled in the Province of Ontario and/or the defendant carried on business in the Province.

[10] At the time of the accident, the defendant corporation had two directors. On January 12, 2011, one of the directors, Nam Eun Kim, swore an affidavit indicating that at the time of the accident, he resided in Alberta, but in September of 2009, he moved to Toronto. However, his affidavit expressly states, “The defendant has no assets, employees or businesses in Ontario.” Mr. Kim’s current whereabouts are unknown.

[11] The plaintiffs argue that since Mr. Kim resided in Ontario and because he was the directing mind of the corporation, that factor that ought to be taken into account. However, there is no evidence that Mr. Kim took any steps to transfer the defendant corporation to Ontario. In my view, the fact that Mr. Kim resided in Ontario for a period of time after the accident, is not sufficient to indicate that the defendant is domiciled or resident in the Province of Ontario. The Alberta is domicile of the defendant corporation. This is not a case where the “corporate veil” ought to be pierced to find that this corporation is connected to Ontario based on the subsequent residence of one of the directors.

[12] The plaintiff further submits that because the hotel catered to temporary workers stationed in Whitecourt, and workers may have been from other provinces, therefore the defendant was doing business in other Canadian provinces and meets the presumptive factor.

[13] In my view, this does not accord with the evidence in this case. There is no evidence that this hotel marketed or solicited guests outside Alberta.

[14] Although the following case was decided prior to Van Breda, I find that the Court of Appeal’s decision in Sinclair v. Cracker Barrell (2002), 2002 44955 (ON CA), 60 O.R. (3d) 76 at para. 21 provides guidance:

To require restaurant owners and operators to litigate the claims of customers wherever they reside would impose a heavy burden that is difficult to justify under the principles of order and fairness expressed in Morguard and Hunt.

[15] The Court of Appeal made reference to those principles again in Van Breda v. Village Resorts Limited, 2010 ONCA 84, 98 O.R. (3d) 721 at para. 89, “Where the defendant confines his activities to its home jurisdiction, it will not ordinarily be subject to the jurisdiction of the forum.”

[16] I am not satisfied that the plaintiff has established a real and substantial connection to Ontario. The defendant, an Alberta corporation, was domiciled in Alberta. The defendant carried on its hotel business in Alberta. The plaintiff’s accident occurred while he was a guest in this Alberta hotel.

Forum Non-Conveniens or Forum of Necessity

[17] In Van Breda, Label J. provided the following guidance at para. 100:

If the court concludes that it lacks jurisdiction because none of the presumptive connecting factors exist, or because a presumption of jurisdiction that flows from one of those factors has been rebutted, it must dismiss or stay the action, subject to the possible application of the forum of necessity doctrine, which I need not address in these reasons. If jurisdiction is established, the claim may proceed, subject to the court’s discretion to stay the proceedings on the basis of the doctrine of forum non-conveniens.

[18] I am satisfied that jurisdiction not having been established, it is not necessary to consider the forum non-conveniens factors. However, I will review the forum of necessity issue. It is clear that the limitation period in Alberta has now expired. Does that therefore make Ontario a forum of necessity for the plaintiffs’ claim?

[19] The forum of necessity doctrine was explained by the Ontario Court of Appeal in Van Breda. As Sharpe J.A. stated at para. 100:

The forum of necessity doctrine does not redefine real and substantial connection to embrace “forum 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.

[20] In Forsythe, supra, Perell J. reviewed cases on the issue of forum of necessity and set out at paras. 27 and 28:

[27] I see no room for the operation of the forum of necessity doctrine. This doctrine is an exception to the real and substantial connection test that recognizes that there will be extraordinarily and exceptional cases where the need to ensure access to justice will justify the domestic court’s assumption of jurisdiction. [Citations omitted.]

[28] The exception is very narrow, and the plaintiff must establish that there is no other forum in which he or she reasonably could obtain access to justice. Typically, the doctrine is unavailable because of its high bar, and its availability has been rejected on numerous cases. The doctrine is reserved for exceptional cases such as where there has been a breakdown in diplomatic or commercial relations with the foreign state or where the plaintiff would be exposed to a risk of serious physical harm if the matter was litigated in the foreign court.

[21] In Forsythe v. Westfall, 2015 ONCA 810, the Ontario Court of Appeal upheld the decision of Perell J. in Forsythe, and stated at para. 53:

The forum of necessity doctrine is available in extraordinary and exceptional circumstances. For Ontario to accept jurisdiction as the “forum of necessity”, the appellant must establish that there is no other forum in which she can reasonably seek relief. [Citations omitted.]

[22] In Ibrahim v. Robinson, 2015 ONCA 21, the Ontario Court of Appeal found such exceptional circumstances. That was a case involving an accident which occurred in Michigan, U.S.A. The claim was commenced in Ontario within the two-year limitation period. Michigan has a three-year limitation period. In that case, the defendant did not bring its motion challenging jurisdiction until after the expiry of the three-year limitation period. In noting that very unique situation, the Court agreed with the motions judge’s decision to stay the action, and noted at para. 11:

The motions judge found that the appellants delayed in bringing their motion until after the expiry of the limitation period in Michigan, possibly lulling the respondents into a false sense of security.

[23] Moreover, in Ibrahim, the Court of Appeal made reference to its earlier decision in West Van Inc. v. Daisley, 2014 ONCA 232, noting at para. 10, “Hoy A.C.J.O. stated that the expiry of the limitation period in the proper foreign forum does not make Ontario the forum of necessity.”

[24] In Mitchell v. Jeckovich, 2013 ONSC 7494, Milanetti J. considered the forum of necessity doctrine in a situation where the limitation period in the other jurisdiction had expired. With respect to that issue, Justice Milanetti concluded at para. 49:

That being said, I do not accept that I should be relying on a perhaps tactical decision on the part of the 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 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”. [Citations omitted.]

Conclusion

[25] I am satisfied that the rare and exceptional circumstances required to find forum of necessity do not exist here. The plaintiffs’ counsel put the defendant on notice about a possible claim less than three months after the accident, but waited until just before the limitation period expired in both Alberta and Ontario to issue a claim in Ontario. This is not an exceptional case like Ibrahim where the defendants delayed bringing a motion until after the expiration of a limitation period. In this case, the limitation period expired shortly after the claim was issued and well before the claim was served on the defendant. Significantly, the plaintiffs were put on notice that a motion would be brought to stay the action when the claim was issued. There is no suggestion that the defendant engaged in any delay tactics as was the case in Ibrahim.

[26] In my view, the plaintiffs cannot take advantage of the forum of necessity doctrine by choosing one forum while allowing the limitation period to expire in the other forum.

[27] I therefore grant the relief sought by the defendant, a stay of this action.

Costs

[28] At the conclusion of the hearing, both parties agreed that the successful party ought to be awarded costs in the amount of $20,000. I therefore order costs against the plaintiffs to the defendants, payable forthwith in the amount of $20,000, all inclusive.

MULLIGAN J.

Released: December 21, 2015