Forsythe v. Westfall, 2015 ONCA 810 (CanLII)

Released November 24, 2015 | Decision [CanLII]

This was an appeal from a motion judge’s decision to permanently stay the plaintiff’s action.

The plaintiff was injured while a passenger on the defendant’s motorcycle. The defendant was an Alberta resident and the accident occurred in British Columbia. The defendant alleged that an unidentified driver caused the collision.

The plaintiff was an Ontario resident. She commenced a claim against the defendant in Ontario, along with a John Doe and her own automobile insurance company, pursuant to the uninsured coverage and the OPCF-44R Family Protection Coverage provisions of her policy.

The defendant brought a motion to stay the action against him on the basis that the Ontario court lacked jurisdiction over him. The motion judge allowed the motion on the basis that there was no “real or substantial connection” between the matter, the parties, and Ontario. He followed the Court of Appeal’s case in Tamminga v Tamminga and held that the plaintiff’s Ontario automobile insurance policy was not a factor that satisfied the “real and substantial connection test” as set out in the Supreme Court of Canada’s decision in Club Resorts Ltd v Van Breda.

The plaintiff appealed. The Court of Appeal rejected the appellant’s arguments that Ontario had jurisdiction simpliciter or that it was the forum of necessity.

 

Jurisdiction Simpliciter

The appellant noted that her automobile insurance policy, issued to her in Ontario, required that an Ontario court determine issues of liability and damages, pursuant to section 4(1) of Regulation 676 – Uninsured Automobile Coverage. Therefore, it was argued that her policy was a presumptive connecting factor that satisfied the real and substantial connection test set out in Van Breda. In that decision, Lebel J. set out the four presumptive connecting factors as follows:

  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.

The appellant argued that her automobile insurance policy was a “contract connected with the dispute”.

Regulation 676 compelled her to sue her insurer in Ontario and therefore, Ontario had jurisdiction over at least part of the dispute. The appellant argued that the Ontario court should assume jurisdiction over her entire claim. She argued that to do otherwise would force plaintiffs to conduct multi-jurisdictional litigation whenever there was a tort action arising out of an out-of-province motor vehicle collision and a related action against a plaintiff’s automobile insurer, pursuant to a contract made in Ontario. The appellant argued that this would be contrary to the Supreme Court’s decision in Van Breda.  The appellant relied on the following comments of Lebel J. in that decision:

I should add that it is possible for a case to sound both in contract and in tort or to invoke more than one tort. Would a court be limited to hearing the specific part of the case that can be directly connected with the jurisdiction? Such a rule would breach the principles of fairness and efficiency on which the assumption of jurisdiction is based. The purpose of the conflicts rules is to establish whether a real and substantial connection exists between the forum, the subject matter of the litigation and the defendant. If such a connection exists in respect of a factual and legal situation, the court must assume jurisdiction over all aspects of the case. The plaintiff should not be obliged to litigate a tort claim in Manitoba and a related claim for restitution in Nova Scotia. That would be incompatible with any notion of fairness and efficiency.

The Court of Appeal rejected this submission. It held that the appellant sued the respondent in tort and tort only.  It held that, absent the collision, she would have no claim against her own insurer. The potential claim against her insurer arose due to a private contract between the appellant and her insurer. The respondent was not a party to that contract and had nothing to do with it. The Court of Appeal cited Tamminga for the principle that there was no nexus between the appellant’s insurance contract and the respondent and, therefore, was not a “contract connected with the dispute”.

The appellant argued that Tamminga did not consider section 4(1) of Regulation 676, which requires insureds to litigation their uninsured/underinsured claims against their own insurer in Ontario. The Court of Appeal rejected this submission and refused to distinguish Tamminga on that basis. It held that whether that term was prescribed by statute or not, it remained a term of the contract between the appellant and her insurer. It had nothing to do with the respondent. The Court of Appeal cited their prior decision in Gajraj v DeBernardo for the following principle:

…the core of the claim is against the New York defendants and the claim against the Ontario defendant 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.

The appellant argued that this was inconsistent with prior Court of Appeal decisions that a plaintiff had a direct right of action against his or her own insurer and that her action against her insurer was not contingent on the outcome of her claim against the respondent. The Court of Appeal rejected this argument as well. While it held that the law was clear that a plaintiff had a direct right of action against his or her own insurer, the Court of Appeal held that Tamminga and Gajraj were not inconsistent with this proposition. They did not interfere with the appellant’s right to pursue a direct claim against her own insurer.

Finally, the appellant argued that if the appellant could not meet any of the four presumptive connecting factors set out in Van Breda, then a new presumptive connecting factor should be recognized. This factor should be based on the appellant’s insurance contract, the regulatory requirement, the fact that she resided in Ontario, that she sustained damages in Ontario, and that she is required to bring suit in two jurisdictions, which may give rise to inconsistent verdicts. The appellant argued that recognizing a new presumptive connecting factor in the circumstances would be consistent with the values of order, fairness, efficiency, and comity.

The Court of Appeal rejected this argument and held that these factors were not to be considered under jurisdiction simpliciter. As Lebel J. noted in Van Breda, jurisdiction simpliciter must be established primarily on the basis of objective factors that connect the legal situation and subject matter with the forum. Abstract concerns for order, efficiency, or fairness were no substitute for connecting, objective factors.

 

Forum of Necessity

The Court of Appeal also refused to assume jurisdiction on the basis of the forum of necessity doctrine. It held this was only available in extraordinary and exceptional circumstances. The Court of Appeal held that this doctrine was very narrow and the appellant must have established that there was no other forum in which she could reasonably have obtained access to justice. The appellant failed to do this as she was free to pursue her claim against the respondent in British Columbia and pursue her claim against her insurer in Ontario.

Read the full Decision [CanLII]

Liane Shepley-Brown
Written by

Liane first joined Oatley Vigmond as a law student and later joined the team as an Associate Lawyer after her call to the bar. She holds a JD from the University of Windsor and an undergraduate degree in Psychology from the University of Guelph.

Liane is committed to representing individuals who have suffered serious personal injuries and to families who have suffered the loss of a loved one. Her practice concentrates on personal injury law, including accident benefits, motor vehicle collisions, medical malpractice, occupiers’ liability, product liability and wrongful death cases.

When Liane isn’t practicing personal injury law, she enjoys working out and spending time with family and friends.