Newfoundland and Labrador (Attorney General) v. Rothmans Inc. et al., (2013) 345 Nfld. & P.E.I.R. 40 (NLTD(G))

• Court: Supreme Court of Newfoundland and Labrador (Canada)
• Case Date: June 20, 2013
• Jurisdiction: Newfoundland and Labrador
• Citations: (2013), 345 Nfld. & P.E.I.R. 40 (NLTD(G))

Nfld. (A.G.) v. Rothmans Inc. (2013), 345 Nfld. & P.E.I.R. 40 (NLTD(G));

    1074 A.P.R. 40

MLB headnote and full text

Temp. Cite: [2013] Nfld. & P.E.I.R. TBEd. DE.045

Attorney General of Newfoundland and Labrador (plaintiff) v. Rothmans Inc., Rothmans, Benson & Hedges Inc., Carreras Rothmans Limited, Altria Group, Inc., Philip Morris U.S.A. Inc., Philip Morris International Inc., JTI-Macdonald Corp., R. J. Reynolds Tobacco Company, R.J. Reynolds Tobacco International Inc., Imperial Tobacco Canada Limited, British American Tobacco P.L.C., B.A.T. Industries P.L.C., British America Tobacco (Investments) Limited and Canadian Tobacco Manufacturers Council (defendants)

(201101G0826; 2013 NLTD(G) 180)

Indexed As: Newfoundland and Labrador (Attorney General) v. Rothmans Inc. et al.

Newfoundland and Labrador Supreme Court

Trial Division (General)

Orsborn, C.J.T.D.

December 19, 2013.

Summary:

In February 2011, the government of Newfoundland and Labrador commenced an action against various tobacco manufacturers seeking to recover health care costs incurred by the province in treating "tobacco-related disease". The action was statutory, founded on the provisions of the Tobacco Health Care Costs Recovery Act, S.N.L. 2001, c. T-4.2. The statute and related court action mirrored similar legislation and proceedings in other provinces. The province asserted that the defendants had committed or conspired to commit tortious "tobacco-related wrongs", which wrongs caused or contributed to disease, the cost of treating which the province now sought to recover from the defendants. Some of the defendants were domestic companies; others were foreign. Six of the eight foreign defendants brought applications challenging the jurisdiction, or territorial competence, of the court to adjudicate the claims against them.

The Newfoundland and Labrador Supreme Court, Trial Division (General), held that, before considering the substantive applications challenging jurisdiction, it was appropriate to establish the legal framework of the jurisdictional challenge, in which the related evidentiary and procedural issues would be decided. The court determined the issues accordingly.

Conflict of Laws - Topic 601

Jurisdiction - General principles - General - [See first Conflict of Laws - Topic 603 ].

Conflict of Laws - Topic 603

Jurisdiction - General principles - Jurisdiction simpliciter (territorial competence) - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that "There are two traditional common law bases on which a court can assume jurisdiction over a defendant; the presence of the defendant within the jurisdiction or service on the defendant while within the jurisdiction ('presence-based jurisdiction'); and consent of the defendant by agreement or attornment ('consent-based jurisdiction'). The needs of the modern world led to the development of a more expansive basis upon which a court could legitimately assume jurisdiction - a real and substantial connection between the forum (state) of the court and either the claim before the court or the defendant. In these reasons, and as acknowledged by counsel, jurisdiction based on a real and substantial connection is equivalent to territorial competence. Jurisdiction assumed on traditional grounds and jurisdiction based on a real and substantial connection between the forum and either the defendant or the subject matter of the action are discrete means by which a court can legitimately assume jurisdiction over a dispute. They are separate and apart from issues of choice of law and forum non conveniens ... " - See paragraphs 9 to 12.

Conflict of Laws - Topic 603

Jurisdiction - General principles - Jurisdiction simpliciter (territorial competence) - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that "The interests involved in a determination of territorial competence are of a higher order than the parties' rights and obligations at issue in the dispute in question. Although heard in the context of a dispute between parties, the determination of the territorial competence of the court to adjudicate a particular claim is not an adjudication involving the competing interest of the parties. It is more in the nature of an assessment by the court of whether the claim presented is one that can be accepted for adjudication. In essence it is a question that is asked by the court of itself, rather than a question raised by a party in pursuit of or in defence of a claim. The determination of territorial competence based on a real and substantial connection is a non-discretionary exercise involving the identification of objective factor(s) that connect the claim to the forum. For the purpose of the determination of territorial competence based on a real and substantial connection between the subject matter of the claim and the forum, the subject matter is ascertained from the pleadings supplemented where appropriate, by evidence of any necessary jurisdictional fact(s). A distinction must be maintained between jurisdictional facts and substantive facts. (They may in exceptional circumstances overlap.) Jurisdictional facts are facts relevant only to the territorial competence of the court; substantive facts are facts relevant to the merits of the claim and which have no relevance to territorial competence." - See paragraphs 13 to 15.

Conflict of Laws - Topic 603

Jurisdiction - General principles - Jurisdiction simpliciter (territorial competence) - The Newfoundland and Labrador Supreme Court, Trial Division (General), reviewed the law respecting the law of territorial competence (real and substantial connection approach) - The court concluded that an assumption of jurisdiction could be grounded on a real and substantial connection between the jurisdiction and either the subject matter or the parties - A presumption of territorial competence (jurisdiction) could be rebutted by satisfying the court that the relationship between the established connecting factor and the litigation was too weak to justify the assumption of jurisdiction over the proceeding - A properly pleaded cause of action against a particular foreign defendant was not a necessary condition to an assumption of jurisdiction over the proceeding, as a matter of common law (i.e., subject to any specific rule of court) - At common law, a real and substantial connection between the cause of action as pleaded against a particular foreign defendant and the jurisdiction was not a necessary condition to an assumption of jurisdiction over the proceeding - The application of the real and substantial connection test, as a matter of common law, did not involve an assessment of the merits of the plaintiff's claim - A good and arguable case on the asserted jurisdictional fact or facts, was not a necessary condition to assuming jurisdiction over the proceeding, at common law - At common law, a good and arguable case on the merits was not a necessary condition to the assumption of jurisdiction to adjudicate the claim against a particular foreign defendant - See paragraphs 9 to 340.

Conflict of Laws - Topic 603

Jurisdiction - General principles - Jurisdiction simpliciter (territorial competence) - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that "A determination of jurisdiction (territorial competence) is a discrete determination which considers the proceedings in question not from the point of view of the parties, but from the point of view of the state and its courts. The court is concerned with the narrow issue of its own jurisdiction to process and consider the claim brought before it. It is concerned with the general nature of the claim and the connections of the claim to the jurisdiction. It is not concerned with and has no interest in the merits or otherwise of the claim; it is not the direct interests of the parties that are at issue. The interests and circumstances of the parties may inform any later determination of forum non conveniens." - See paragraph 314.

Conflict of Laws - Topic 641

Jurisdiction - Submission to jurisdiction - General - [See first Conflict of Laws - Topic 603 ].

Conflict of Laws - Topic 1661

Actions - General - Forum conveniens - General - [See fourth Conflict of Laws - Topic 603 ].

Cases Noticed:

Van Breda et al. v. Village Resorts Ltd. et al. (2012), 429 N.R. 217; 291 O.A.C. 201; 2012 CarswellOnt 4268; 2012 SCC 17, appld. [para. 19].

Morguard Investments Ltd. et al. v. De Savoye, [1990] 3 S.C.R. 1077; 122 N.R. 81, appld. [para. 19].

Moran v. Pyle National (Canada) Ltd., [1975] 1 S.C.R. 393; 1 N.R. 122, appld. [para. 19].

Beals v. Saldanha et al., [2003] 3 S.C.R. 416; 314 N.R. 209; 182 O.A.C. 201; 2003 SCC 72, appld. [para. 19].

Emanuel v. Symon, [1908] 1 K.B. 302 (C.A.), refd to. [para. 23].

Fewer v. Saisi Dene Education Authority - see Fewer v. Ellis et al.

Fewer v. Ellis et al. (2011), 305 Nfld. & P.E.I.R. 39; 948 A.P.R. 39; 2011 NLCA 17, appld. [para. 39].

Distillers Co. (Biochemicals) Ltd. v. Thompson, [1971] A.C. 458; [1971] 1 All E.R. 694, refd to. [para. 45].

Cougar Helicopters Inc. et al. v. Sikorsky Aircraft Corp. et al. (2011), 309 Nfld. & P.E.I.R. 143; 962 A.P.R. 143; 2011 NLCA 49, appld. [para. 76].

House v. Workers' Compensation Board (Alta.) et al. (2012), 318 Nfld. & P.E.I.R. 181; 989 A.P.R. 181; 2012 NLCA 14, appld. [para. 80].

Tolofson v. Jensen and Tolofson, [1994] 3 S.C.R. 1022; 175 N.R. 161; 77 O.A.C. 81; 51 B.C.A.C. 241; 84 W.A.C. 241, refd to. [para. 110].

Muscutt et al. v. Courcelles et al. (2002), 160 O.A.C. 1; 60 O.R.(3d) 20; 213 D.L.R.(4th) 577 (C.A.), refd to. [para. 112].

Van Breda et al. v. Village Resorts Ltd. et al. (2010), 264 O.A.C. 1; 2010 ONCA 84, refd to. [para. 112].

Spar Aerospace Ltd. v. American Mobile Satellite Corp. et al., [2002] 4 S.C.R. 205; 297 N.R. 83; 2002 SCC 78, refd to. [para. 139].

Éditions Écosociété Inc. v. Banro Corp. - see Banro Corp. v. Editions Ecosociété Inc. et al.

Banro Corp. v. Editions Ecosociété Inc. et al. (2012), 429 N.R. 293; 2012 SCC 18, refd to. [para. 157].

Breeden v. Black - see Black v. Breeden et al.

Black v. Breeden et al. (2012), 429 N.R. 192; 291 O.A.C. 311; 2012 SCC 19, refd to. [para. 163].

Ecolab Ltd. v. Greenspace Services Ltd. et al. (1998), 107 O.A.C. 199; 38 O.R.(3d) 145 (Div. Ct.), refd to. [para. 169].

Canadian Westinghouse Co. v. Davey, [1964] 2 O.R. 282 (C.A.), refd to. [para. 171].

Furlan et al. v. Shell Oil Co. et al., [2000] 7 W.W.R. 433; 140 B.C.A.C. 235; 229 W.A.C. 235; 77 B.C.L.R.(3d) 35; 2000 BCCA 404, refd to. [para. 178].

Bushell v. T. & N. plc (1992), 67 B.C.L.R.(2d) 330 (S.C.), refd to. [para. 179].

Northland Properties Ltd. v. Equitable Properties Co., [1991] B.C.J. No. 4068 (S.C.), refd to. [para. 183].

Quest Vitamin Supplies Ltd. v. Hassam (1992), 79 B.C.L.R.(2d) 85 (S.C.), refd to. [para. 183].

Stern v. Dove Audio Inc., [1994] B.C.J. No. 863 (S.C.), refd to. [para. 183].

AG Armeno Mines and Minerals Inc. v. PT Pukuafu Indah et al. (2000), 140 B.C.A.C. 93; 229 W.A.C. 93; 2000 BCCA 405, refd to. [para. 184].

Purple Echo Productions Inc. v. KCTS Television (2008), 253 B.C.A.C. 134; 425 W.A.C. 134; 76 B.C.L.R.(4th) 21; 2008 BCCA 85, refd to. [para. 194].

MTU Maintenance Canada Ltd. v. Jensen (Norman G.) Inc. et al. (2007), 248 B.C.A.C. 153; 412 W.A.C. 153; 2007 BCCA 552, refd to. [para. 201].

Stanway v. Wyeth Pharmaceuticals Inc. et al. (2009), 279 B.C.A.C. 158; 473 W.A.C. 158; 2009 BCCA 592, refd to. [para. 206].

Schreiber v. Mulroney, [2007] O.T.C. Uned. G72; 88 O.R.(3d) 605 (Sup. Ct.), refd to. [para. 222].

Tucows.com Co. v. Lojas Renner S.A. (2011), 281 O.A.C. 379; 106 O.R.(3d) 561; 2011 ONCA 548, refd to. [para. 235].

Singh v. Howden Petroleum Ltd. (1979), 24 O.R.(2d) 769 (C.A.), refd to. [para. 237].

Wall Estate et al. v. GlaxoSmithKline Inc. et al. (2010), 367 Sask.R. 21; 2010 SKQB 351, refd to. [para. 241].

Ontario v. Rothmans Inc. et al. (2013), 305 O.A.C. 261; 2013 ONCA 353, refd to. [para. 252].

2249659 Ontario Ltd. et al. v. Sparkasse Siegen et al. (2013), 306 O.A.C. 288; 115 O.R.(3d) 241; 2013 ONCA 354, refd to. [para. 269].

Central Sun Mining Inc. v. Vector Engineering Inc. et al. (2013), 310 O.A.C. 391; 2013 ONCA 601, refd to. [para. 280].

Yaiguaje et al. v. Chevron Corp. et al., [2013] O.T.C. Uned. 2527; 2013 ONSC 2527, refd to. [para. 285].

Pro Swing Inc. v. Elta Golf Inc., [2006] 2 S.C.R. 612; 354 N.R. 201; 218 O.A.C. 339, refd to. [para. 291].

Greenbuilt Group of Companies Ltd. v. RMD Engineering Inc., [2013] A.R. Uned. 438; 2013 ABQB 346, refd to. [para. 299].

Counsel:

Glenda Best, Q.C., for the Attorney General of Newfoundland and Labrador;

Ian Kelly, Q.C. and Annette Conway, for R. J. Reynolds Tobacco Company and R.J. Reynolds Tobacco International Inc.;

Craig P. Dennis and Owen James, for British American Tobacco (Investments Ltd.);

Ian Wallace and Christopher Rusnak, for B.A.T. Industries P.L.C. and Carreras Rothmans Limited;

Katherine O'Brien, David Byers and Lesley Mercer, for British American Tobacco P.L.C.

This case was heard on June 20, 2013, at St. John's, N.L., by Orsborn, C.J.T.D., of the Newfoundland and Labrador Supreme Court, Trial Division (General), who delivered the following decision on December 19, 2013.