Muscutt is Dead! Long Live Muscutt! Another Canadian court applies old jurisdictional test

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Here’s more proof why lawyers and judges should read this blawg, or at least note up their cases once in a while.

In my earlier post,”Attention All Canadian Judges: Muscutt is Old News” I noted that some courts were still applying Muscutt v. Courcelles, despite Justice Sharpe’s modification of the the “real and substantial connection” test in Van Breda (currently pending appeal in the Supreme Court of Canada).

Despite the ubiquity of online legal resources; specifically CanLII (and  even subscription based legal research portals),  a handful of Canadian courts—Nova Scotia, Newfoundland & Labrador and even Ontario—continued to apply the Muscutt factors in motions challenging jurisdiction post-Van Breda.

I appreciate that sometimes it takes a few weeks, or a even a couple of months, before a legal development in one province filters down into another province. But a year later?

Check Group Canada Inc. v. Icer Canada Corporation, 2010 NSSC 463 (CanLII):

“[26]         The “Muscutt factors” have been adopted and applied in Nova Scotia in many decisions, and in respect of s.4 of the CJPTA, in McDermott Gulf Operating Co. v Oceanographia Sociedad Anonima de Capital Variable, 2010 NSSC 118 (CanLII), 2010 NSSC 118 [McDermott Gulf Operating].  Further, these factors, as well as Sharpe J.A.’s analysis, were explicitly endorsed by the Court of Appeal in Bouch v. Penny, 2009 NSCA 80 (CanLII), 2009 NSCA 80 [Bouch II].

[27]         The Choueke defendants submit that an analysis of the Muscutt factors strongly militates against the assumption of jurisdiction.  The plaintiff argues that the Muscutt factors support a finding of territorial competence.

[28]         In my view, at the first‑stage of the CJPTA analysis, if the only basis for territorial competence is a real and substantial connection, a detailed analysis of each Muscutt factor is not always necessary.  “The real and substantial connection test requires only a real and substantial connection, not the most real and substantial connection” [emphasis in original] (Muscutt at 594; See also Bouch II at para.49).  This is to be distinguished from the doctrine of forum non conveniens,  which acknowledges that more than one forum can have jurisdiction, and instead asks which forum is the most appropriate for adjudicating the subject matter.  Where the Muscutt factors support a finding of real and substantial connection, it is not necessary, at the first‑stage, to also ask whether the forum has the most real and substantial connection.

[29]         In this case, two Muscutt factors support a finding of a real and substantial connection to Nova Scotia:  1) the connection between the forum and the plaintiff’s claim; and 2) unfairness to the plaintiff in not assuming jurisdiction (without unfairness to the defendant in assuming jurisdiction).”

4 Responses to “Muscutt is Dead! Long Live Muscutt! Another Canadian court applies old jurisdictional test”

  1. M Says:

    You are aware that judgments of the Ontario Court of Appeal are not binding precedent in Nova Scotia? And that Nova Scotia has its own Court of Appeal?

  2. Antonin I. Pribetic Says:

    Based upon your comment, you’re likely not a lawyer which is why you missed the point of the post. The doctrine of stare decisis is not the issue, albeit appeal court judgments from one common-law province are persuasive authority in another. The point was the court’s incorrect application of the Muscutt test, instead of the revised Van Breda test for jurisdiction simpliciter.

  3. Nathan Boivin Says:

    The court in Van Breda specifically states that the Van-Breda Charron approach applies to tort cases, it has yet to be determined to what extent Van Breda will impact non-tort cases. Is the modified test from the Muscutt appeal pertinent for non-tort cases?

  4. Antonin I. Pribetic Says:

    The Supreme Court of Canada reformulated the Van Breda-Charron approach, which applies specifically to tort cases. See my previous posts:

    1. Supreme Court of Canada Further Modifies Jurisdictional Test in Tort Actions

    2. The Supreme Court of Canada Conflict of Laws Trilogy: Part I

    3. The Supreme Court of Canada Conflict of Laws Trilogy: Part II

    For contract cases, the “strong cause” test applies if there is a forum selection/exclusive jurisdiction clause.

    That said, Justice LeBel in Van Breda/Charron appears to limit the new formulation to “tort” cases, or perhaps including ” business tort” cases, stating:

    [90]                          To recap, in a case concerning a tort, the following factors are presumptive connecting factors that, prima facie, entitle a court to assume jurisdiction over a dispute:

    (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; and

    (d)      a contract connected with the dispute was made in the province. [emphasis added]

    In my view, the CJPTA is superior insofar as it addresses the connecting factors for contractual claims, albeit also reflected in Rule 17.02(f) which reads:

    Contracts

    (f) in respect of a contract where,
    (i) the contract was made in Ontario,
    (ii) the contract provides that it is to be governed by or interpreted in accordance with the law of Ontario,
    (iii) the parties to the contract have agreed that the courts of Ontario are to have jurisdiction over legal proceedings in respect of the contract, or
    (iv) a breach of the contract has been committed in Ontario, even though the breach was preceded or accompanied by a breach outside Ontario that rendered impossible the performance of the part of the contract that ought to have been performed in Ontario;…

    Muscutt is no longer applicable.

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