Nanisivik Mines Ltd. et al. v. F.C.R.S. Shipping Ltd. et al., (1993) 59 F.T.R. 272 (TD)

• Judge: Walsh, J.
• Court: Federal Court (Canada)
• Case Date: December 04, 1992
• Jurisdiction: Canada (Federal)
• Citations: (1993), 59 F.T.R. 272 (TD)

Nanisivik Mines v. FCRS Shipping Ltd. (1993), 59 F.T.R. 272 (TD)

MLB headnote and full text

Nanisivik Mines Ltd. and Zinc Corp. of America (plaintiffs) v. F.C.R.S. Shipping Ltd., Finnlines O.Y. A/B, Finnlines Group O.Y. A/B, Finncarriers O.Y. A/B, F.G. Shipping O.Y. A/B, Canarctic Shipping Co. Ltd., Matti J. Pulli, Kari K.J. Lautamies, Jouni Kalvi, John Doe and Kari Manninen (defendants)

(T-27-92)

Indexed As: Nanisivik Mines Ltd. et al. v. F.C.R.S. Shipping Ltd. et al.

Federal Court of Canada

Trial Division

Walsh, J.

January 19, 1993.

Summary:

A ship sank and the cargo was lost. The owner of the cargo sued the party the ship was chartered from (Canarctic), the ship owners, etc., in both contract and tort. A claim in tort was made against certain officers of the crew for whom the carriers were vicariously liable. Canarctic applied for an order referring the parties to arbitration. In the alternative, Canarctic applied for leave to file a conditional appearance in order that it could object to the jurisdiction of the court and for an order staying the proceedings to allow such objection to be raised and deter­mined.

The Federal Court of Canada, Trial Divi­sion, referred the matter to arbitration and stayed the proceedings against Canarctic pending the disposition of the arbitration.

Arbitration - Topic 2504

Stay of proceedings - Arbitration clause - Enforcement of - Canarctic executed a time charter for the ship Finnpolaris - The time charter stated that disputes would be settled by arbitration in London, England - Nanisivik executed a charter party with Canarctic for the shipment of zinc concen­trate - The charter party stated that dis­putes would be resolved by arbitration in London - The bill of lading stated that the terms of the charter party were incorpor­ated into the bill of lading - When the cargo was lost, Nanisivik sued, inter alia, Canarctic and the ship's owners - Canarctic applied for an order referring the matter to arbitration and for a stay of proceedings - The Federal Court of Canada, Trial Division, referred the matter to arbitration but stayed the proceedings against Canarctic only.

Arbitration - Topic 2505

Stay of proceedings - Arbitration clause - Effect of - The parties to a charter party agreed to arbitrate disputes in London - The bill of lading incorporated the terms of the charter party - Section 8 of the Schedule under the Commercial Arbitra­tion Act stated that a court in which an action is commenced, shall refer the parties to arbitration if the contract contained an arbitration agreement - However, s. 50 of the Federal Court Act gave the court dis­cretionary power to grant a stay of pro­ceedings - The Federal Court of Canada, Trial Division, stated "that even an agree­ment to arbitrate in a Bill of Lading cannot remove all discretion from the court to continue proceedings before it, and to decide whether or not a stay of such pro­ceedings will be granted" - See paragraph 29.

Practice - Topic 5277

Trials - General - Stay of proceedings - When available - [See Arbitration - Topic 2504 ].

Cases Noticed:

Ship M/V Seapearls and Patmos Naviga­tion Co. v. Seven Seas Dry Cargo Ship­ping Corp., [1983] 2 F.C. 161; 43 N.R. 517; 139 D.L.R.(3d) 669 (F.C.A.), consd. [para. 22].

Argo Co. of Canada Ltd. et al. v. Ship Regal Scout and Argonaut Marine Inc., [1984] 2 F.C. 851 (F.C.T.D.), consd. [para. 23].

Navionics Inc. v. Flota Maritima Mexicana S.A. et al. (1989), 26 F.T.R. 148 (F.C.T.D.), consd. [para. 24].

BC Navigation S.A. (Bankrupt) v. Canpotex Shipping Services Ltd. (1987), 16 F.T.R. 79 (F.C.T.D.), consd. [para. 26].

Ruhrkohle Handel Inter GmbH et al. v. Fednav Ltd. et al. (1992), 144 N.R. 70 (F.C.A.), consd. [para. 27].

Miramichi Pulp & Paper Inc. et al. v. Canadian Pacific Bulk Ship Services Ltd. et al. (1992), 58 F.T.R. 81, consd. [para. 28].

Paterson Steamships Ltd. v. Aluminum Co. of Canada, [1951] S.C.R. 852, refd to. [para. 39].

Iberfreight S.A. et al. v. Ocean Star Con­tainer Line A.G. et al. (1989), 104 N.R. 164 (F.C.A.), consd. [para. 42].

Statutes Noticed:

Bills of Lading Act, R.S.C. 1985, c. B-6, sect. 2 [para. 3].

Canada Shipping Act, R.S.C. 1985, c. S-9, sect. 574 [para. 11].

Carriage of Goods by Water Act, R.S.C. 1985, c. C-27, generally [paras. 11, 12].

Commercial Arbitration Act, R.S.C. 1985 (2nd Supp.), c. 17, Schedule, art. 8 [paras. 15, 16, 20, 24, 27, 30, 45, 48]; art. 8(1) [para. 16]; art. 8(2) [paras. 16, 47].

Commercial Arbitration Code - see Com­mercial Arbitration Act, R.S.C. 1985 (2nd Supp.), c. 17 Schedule.

Federal Court Act, R.S.C. 1985, c. F-7, sect. 50 [paras. 2, 15, 17, 45, 48]; sect. 50(1) [para. 15]; sect. 50(1)(a), sect. 50(1)(b) [para. 17].

Federal Court Rules, rule 319, rule 401, rule 1026 [para. 2].

Counsel:

George R. Strathy, for the plaintiff;

Gordon F. Henderson and Martin W. Mason, for the defendant Canarctic Shipping Co. Ltd.;

Jeremy Bolger, for the defendant F.C.R.S. Shipping Ltd. and Finncarriers O.Y. A/B.

Solicitors of Record:

Fasken, Campbell and Godfrey, Toronto, Ontario, for the plaintiff;

Gowling, Strathy and Henderson, Ottawa, Ontario, for the defendant Canarctic Shipping Co. Ltd.;

McMaster Meighen, Montreal, Quebec, for the defendant F.C.R.S. Shipping Ltd. and Finncarriers O.Y. A/B.

This matter was heard on December 4, 1992, at Montreal, Quebec, before Walsh, J., of the Federal Court of Canada, Trial Divi­sion, who delivered the following decision on January 19, 1993.