QBD Cooling Systems Inc. v. Sollatek (UK) Limited, 2015 ONSC 947

QBD Cooling Systems Inc. v. Sollatek (UK) Limited, 2015 ONSC 947

Court File No. CV-13-475483

Date: 20150211

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN: QBD COOLING SYSTEMS INC. (Plaintiff)

AND: SOLLATEK (UK) LIMITED (Defendant)

BEFORE: K.W. WHITAKER J.

HEARD: October 10, 2014

COUNSEL: John J. Longo for the Plaintiff

M. Paul Morrissey for the Defendant

E N D O R S E M E N T

What is this Case About

1The plaintiff QBD Cooling Systems Inc. ("QBD") is based in Toronto, and makes commercial coolers that it sells around the world.

2QBD has initiated a claim in Ontario against Sollatek (UK) Limited ("SUKL.")

3SUKL resists the claim and asserts this court lacks jurisdiction over the dispute and in the alternative, that Ontario is forum non conveniens.

4For reasons which follow, I conclude this court has jurisdiction over the dispute and forum non conveniens has not been made out.

Overview

5The claim is in negligence and contract.

6SUKL manufactures electronic equipment and components, including electronic thermostats for industrial use. The company buys and sells products from 39 countries. It maintains its only offices in Slough, England where offices, officers, directors, employees and business records are housed and kept.

7QBD manufactures display cases and coolers for the food services industry. Sales occur inside and outside Canada. Facilities and head offices are in Brampton.

8In 2007, QBD purchased thermostats from SUKL. The written contract, entered into by the parties at the time of the sale, provided the contract was to be construed in accordance with the laws of England and that the customer agrees to submit to the jurisdiction of the English courts.

9In April of 2006, the parties entered into negotiations for a long term supply of electronic thermostats. Negotiations occurred by email for the most part. This purchase was particularly important for QBD as the thermostats would be used in coolers for their largest client – Pepsi.

10QBD anticipated ordering 20,000 thermostats by year 2 of the supply agreement.

11Between 2007 and 2013, QBD placed 25 to 30 orders for the purchase of more than 100,000 thermostats.

12Orders were initiated with QBD requesting product from SUKL. Contractual terms were sent by facsimile or mail for each order to QBD from SUKL.

13At no time did SUKL advise QBD of the “standard terms and conditions” that are referenced in the contract, drafted by QBD.

14After delivery, QBD decided the thermostats were defective. QBD claims to have suffered economic loss as a result.

15This claim was brought in contract and negligence in March 2013.

16SUKL was served with the claim in August 2013.

17On October 8, 2013 SUKL served a Notice of Intent to Defend and a demand for particulars.

18On March 18, 2014 QBD delivered its response to the demand for particulars.

19SUKL takes the position that this court lacks jurisdiction and the action should be put before the English courts.

20QBD argues that SUKL has attorned to this court that this court has jurisdiction and that forum non conveniens does not apply.

Non-Exclusive Jurisdiction

21The contract contains a non-exclusive jurisdiction clause:

28. Applicable Law – The contract shall be construed and have effect in all respects in accordance with the laws of England and the customer hereby submits to the jurisdiction of the English courts.

22The parties agree this means they are not bound to proceed before the English courts but the choice of law may be determined by contract.

The Law

23Ontario has presumptive jurisdiction. SUKL must rebut this presumption or establish that England is the clearly more appropriate forum to dispose of the claim.

24There are two questions that must be addressed on a motion to stay for want of jurisdiction or forum non conveniens. Firstly, do the Ontario courts have jurisdiction and secondly, has SUKL established that England is clearly a more appropriate forum for proceeding?

Jurisdiction

25In the leading case decided by the Supreme Court, Van Breda v. Village Resorts Ltd., 2012 CarswellOnt 4268, 2012 SCC 17, the court noted that where one of four presumptive connecting factors is present, the court is entitled prima facie to assume jurisdiction. These are; is the defendant domiciled or resident in the province; does the defendant carry on business in the province; was the tort committed in the province; and lastly, whether a contract connected with the dispute was made in the province.

26On these criteria, the torts of negligence and negligent misrepresentation were committed in Ontario. The presumptive connecting factor being the tortious conduct committed in the province indicates a strong relationship between Ontario and the subject matter of the litigation. Therefore, the governing law is that of Ontario: 2249659 Ontario Ltd. v. Siegen 2013 ONCA 364.

27A court hearing a stay application must find there is an alternative forum which is clearly more appropriate. The purpose of this inquiry is to find the forum which is best suited to deal with the dispute in a manner that is fair to all parties.

28In Van Breda, the Supreme Court of Canada has indicated that the court is entitled prima facie to assume jurisdiction over the dispute where one of the following factors is present; the defendant is domiciled or resident in the province, the defendant caries on business in the province, the tort was committed in the jurisdiction or the contract was made in the jurisdiction

29In my view, the Ontario courts have jurisdiction over the torts alleged here.

Forum Non Convenience

30Once jurisdiction has been established as it is now here, the plaintiff may establish that the alternative forum is “clearly more appropriate.”

31Factors a court may consider may vary depending on the context; the locations of parties and witnesses; the cost of transferring the action to another jurisdiction; the impact on the conduct of the litigation; the risk of conflicting judgments; recognition and enforcement issues; and the strengths of the parties relative to each other.

32Having reviewed this list of considerations, I conclude that the respondent has not persuaded me that the forum non conveniens has been clearly made out. I conclude that this court may exercise jurisdiction over this dispute.

33I agree with the respondent that even if it is assumed the forum selection was agreed, the respondent has failed to establish that the courts of England are more appropriate to displace the choice of forum made by the plaintiff.

The Outcome

34This motion is dismissed.

35The parties may make written submissions as to costs on two pages, within two weeks of the date of this decision.