T-1478-87
Newterm Limited (Plaintiff)
v.
Mys Budyonnogo and Murmanskrybprom
(First defendants)
and
Newfoundland Dockyard Company (Second
defendant)
INDEXED AS: NEWTERM LTD. V. MYS BUDYONNOGO (TAE)
(TD.)
Trial Division, Reed J.—Halifax, April 14; Vancou-
ver, May 22, 1992.
Federal Court jurisdiction — Trial Division — Motions to
strike out statement of claim for want of jurisdiction — Court's
maritime jurisdiction under Federal Court Act, s. 22 at issue
— Ship being spraypainted while moored at dock — Damage
caused by paint drifting onto 400 cars stored nearby —
Whether damage caused by ship "in collision or otherwise"
within meaning of s. 22 — That particular cause of action
outside enumerated categories of s. 22(2) not determinative of
jurisdiction — Test in ITO case applied — Case law reviewed
— Operational test should be applied in determining whether
damage "caused by a ship" for maritime law purposes —
Claim within scope of s. 22(1) as fed by s. 2(1).
Maritime law — Torts — Whether paint drifting onto parked
cars when defendant ship being spraypainted damage "caused
by a ship" under Federal Court Act, s. 22(2)(d) — "Damage
caused by a ship" when resulting from actions of crew acting
under directions of master and integrally related to operation
of ship — Activity giving rise to damage herein having close,
practical relationship to navigation of vessel and shipping —
Plaintiff's claim within Canadian maritime law, supported by
constitutionally valid federal law.
Defendants moved under Rule 419 to strike out the state
ment of claim for want of jurisdiction. Whilst the crew of the
defendant ship were spray painting the vessel, moored at the
second defendant's dock, paint drifted onto some 400 new cars
which were stored nearby, causing damage in the amount of
$200,000. The issue was whether the damage was "caused by a
ship either in collision or otherwise" within the meaning of
paragraph 22(2)(d) of the Federal Court Act and whether the
Federal Court had jurisdiction to try this case.
Held, the motions should be dismissed.
The starting point for any assessment of the scope of Federal
Court jurisdiction over maritime matters was the decision of
the Supreme Court of Canada in ITO—International Terminal
Operators Ltd. v. Miida Electronics Inc. et al. Section 22 of the
Federal Court Act, which confers jurisdiction on the Federal
Court in maritime matters, has two different aspects. First, sub
section 22(1) is general in scope while subsection 22(2) is
merely illustrative or explanatory. Thus, a finding that a partic
ular cause of action does not fall within any of the enumerated
categories of subsection 22(2) is not determinative of the
Court's jurisdiction. Second, section 22 is the statutory grant of
jurisdiction which satisfies the first requirement of the ITO
tests. The federal law which nourishes that grant of jurisdiction
is subsection 2(1) of the Federal Court Act and various other
federal statutes such as the Canada Shipping Act. To succeed
in their motion to strike, the first defendants would have to
demonstrate that plaintiff's cause of action does not come
within either the grant of statutory jurisdiction set out in sec
tion 22 or the law which nourishes that grant of jurisdiction.
There is no basis for the distinction suggested by counsel for
the first defendants between the decisions in Toronto Harbour
Commissioners v. The Ship Robert C. Norton et al., where no
act of navigation was involved, and in MacMillan Bloedel Ltd.
v. Canadian Stevedoring Co. et al., where one was. The deci
sion in the Toronto Harbour Commissioners case, in so far as it
relates to the Federal Court's maritime jurisdiction is no longer
good law in light of the Supreme Court decision in ITO. A
functional or operational test should be adopted in determining
when damage can be said to be "caused by a ship" for mari
time law purposes. When a ship is afloat, any damage resulting
from actions of the crew acting under directions of her master,
if those actions are integrally related to the operation of the
ship, should be classified as "damage caused by a ship". As in
the ITO case, the activity which allegedly gave rise to the dam
age herein was an integral part of the activity of shipping and
had a close, practical relationship to the navigation of the ves
sel and shipping. That activity was integrally connected to
maritime matters since it was performed by the crew on the
ship and in relation to the ship presumably under the direction
of the master for the purpose of enabling the ship to carry on
its navigation operations.
As to the second defendant's argument relating to the consti
tutional validity of the plaintiffs claim, it was too late to object
to it as being unrelated to maritime law in that the claim had
been pleaded over and discoveries held. At the very least, the
plaintiff would be entitled to amend to plead the claim with
more specificity to make it clear that it was based on maritime
law. This was a remedy the second defendant has not sought.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Admiralty Act, R.S.C. 1952, c. 1, s. 18(2),(3).
Canada Shipping Act, R.S.C., 1985, c. S-9.
Constitution Act, 1867, 30 & 31 Vict., c. 3 (U.K.) (as am.
by Canada Act 1982, 1982, c. 11 (U.K.), Schedule to
the Constitution Act, 1982, Item 1) [R.S.C., 1985,
Appendix II, No. 5], ss. 91, 101.
Federal Court Act, R.S.C., 1985, c. F-7, ss. 2(1) (as am.
by S.C. 1990, c. 8, s. 1), 22.
Federal Court Rules, C.R.C., c. 663, RR. 341(a), 419,
474 (as am. by SOR/79-57, s. 14).
CASES JUDICIALLY CONSIDERED
FOLLOWED:
ITO—International Terminal Operators Ltd. v. Miida
Electronics Inc. et al., [1986] 1 S.C.R. 752; (1986), 28
D.L.R. (4th) 641; 34 B.L.R. 251; 68 N.R. 241; Monk
Corp. v. Island Fertilizers Ltd., [1991] 1 S.C.R. 779;
(1991), 80 D.L.R. (4th) 58; 123 N.R. 1.
NOT FOLLOWED:
Toronto Harbour Commissioners v. The Ship Robert C.
Norton et al., [1964] Ex.C.R. 498.
CONSIDERED:
Westview Sable Fish Co. et al. v. The Ship "Neekis"
(1986), 31 D.L.R. (4th) 709; 6 F.T.R. 235 (F.C.T.D);
MacMillan Bloedel Ltd. v. Canadian Stevedoring Co. et
al., [1969] 2 Ex.C.R. 375.
REFERRED TO:
The Minerva, [1933] P. 224; Outhouse, Delma C. et al. v.
Str. Thorshavn, [1935] Ex.C.R. 120; [1935] 4 D.L.R. 628;
Currie v. M'Knight, [1897] A.C. 97 (H.L.); Rylands v.
Fletcher (1868), L.R. 3 H.L. 330.
MOTIONS brought by the first defendants and the
second defendant to have the statement of claim
struck out for want of jurisdiction. Motions dis
missed.
COUNSEL:
John F. Roil, Q.C., for plaintiff.
James C. Oakley for first defendants.
Edward A. Gores for second defendant.
SOLICITORS:
O'Reilly, Noseworthy, St. John's, for plaintiff.
Noonan, McGrath, Oakley, Orr, St. John's, for
first defendants.
Edward A. Gores, Halifax, for second defendant.
The following are the reasons for order rendered in
English by
REED J.: Both the first defendants and the second
defendant bring motions to have the plaintiff's state
ment of claim struck out as against them, albeit for
different reasons. Both argue that this Court has no
jurisdiction to hear the plaintiff's claim.
Mys Budyonnogo and Murmanskrybprom ("the
first defendants") argue that the claim as against them
does not come within the scope of the Court's mari
time jurisdiction as set out in section 22 of the Fed
eral Court Act [R.S.C., 1985, c. F-7]. They also adopt
the second defendant's argument.
Newfoundland Dockyard Company ("the second
defendant") argues that this Court has jurisdiction to
hear the plaintiff's claim as against the first defend
ants but that it has no jurisdiction to hear the plain
tiff' s claim as against the second defendant. It argues
that the plaintiff's claim as against the second defen
dant is a matter of "property and civil rights within
the province" and therefore a matter within provin
cial legislative jurisdiction.
Both the first and second defendants framed their
motions under Federal Court Rules [C.R.C., c. 663],
Rule 419:
Rule 419. (1) The Court may at any stage of an action order
any pleading or anything in any pleading to be struck out, with
or without leave to amend, on the ground that
(a) it discloses no reasonable cause of action or defence, as
the case may be,
(b) it is immaterial or redundant,
(c) it is scandalous, frivolous or vexatious,
(d) it may prejudice, embarrass or delay the fair trial of the
action,
(e) it constitutes a departure from a previous pleading, or
(f) it is otherwise an abuse of the process of the Court, and
may order the action to be stayed or dismissed or judgment
to be entered accordingly.
The argument before me however went beyond
what is normally addressed under Rule 419(1)(a)—
the paragraph usually relied upon when challenging
jurisdiction—in that certain admissions additional to
the facts stated in the statement of claim were
accepted by all counsel as relevant. The substance of
the plaintiff's statement of claim is found in
paragraphs 4 to 6:
4. That on or about the 23rd day of June, 1987, the First
Defendant ship allowed paint and other noxious substances to
emanate from the vessel which was moored in the Second
Defendant's facility at Berth 37 in the Port of St. John's, Prov
ince of Newfoundland, thereby causing damage to motor vehi
cles stored on the premises of the Plaintiff situated at St. John's
aforesaid, for which motor vehicles the Plaintiff is responsible
for the maintenance.
5. By virtue of the negligence of the servants and agents of the
Defendant ship and/or the Second Defendant, in allowing the
paint and other noxious substances to emanate from the Defen
dant ship and/or the Second Defendant's facility, the Plaintiff
has suffered damages, particulars of which are as follows:
Damage to 402 Automobiles $200,000.00
6. The Plaintiff's claim is against the Defendants for damage
caused by the Defendant ship and/or the Second Defendant in
the amount of Two hundred thousand dollars ($200,000.00).
Since the filing of the statement of claim on June
30, 1987, the first defendants filed their defence on
July 30, 1987, and an amended defence on September
28, 1987; the second defendant filed its defence on
October 15, 1987; there have been third party actions
and counterclaims; discoveries have been held.
All counsel now agree that what occurred on June
23, 1987, was that the crew of the vessel, Mys Budy-
onnogo were engaged in spray painting part of the
vessel and equipment thereon while the vessel was
moored at the second defendant's dock. (There were
no other noxious substances emanating from the ves
sel, other than the paint.) Some of the paint drifted
onto approximately 400 new cars which were stored
nearby awaiting trans-shipment to dealers.
Counsel for the first defendants argues that these
facts are sufficient to demonstrate that the damage, if
any, caused by the spray paint to the cars cannot be
classified as having been caused by a ship and there-
fore this Court has no jurisdiction. The second defen
dant, as has been noted argued that the claim against
it is based on a negligence claim which is grounded
in law falling within provincial not maritime (or fed
eral) jurisdiction.
It may be that the present motions should more
properly have been brought under either Rule 341(a)
or Rule 474 [as am. by SOR/79-57, s. 14] of the Fed
eral Court Rules, rather than under Rule 419, but in
any event I will deal with the arguments which have
been made.
Section 22 of the Federal Court Act
It is agreed that the starting point for any assess
ment of the scope of this Court's jurisdiction over
maritime matters is the Supreme Court decision in
ITO—International Terminal Operators Ltd. v. Miida
Electronics Inc. et al., [1986] 1 S.C.R. 752. In that
case, it was held that for the Federal Court to have
jurisdiction over a proceeding there must be: (i) a
statutory grant of jurisdiction to the Court by Parlia
ment; (ii) an existing body of federal law which is
essential to the disposition of the case and which
nourishes the statutory grant of jurisdiction; and (iii)
the law on which the case is based must be "a law of
Canada" as that phrase is used in section 101 of the
Constitution Act, 1867 [30 & 31 Vict., c. 3 (U.K.) (as
am. by Canada Act 1982, 1982, c. 11 (U.K.), Sched
ule to the Constitution Act, 1982, Item 1) [R.S.C.,
1985, Appendix II, No. 5]] (the federal law which
nourishes the grant of jurisdiction must be constitu
tionally valid).
In maritime matters, jurisdiction is conferred on
the Federal Court by section 22 of the Federal Court
Act:
22. (1) The Trial Division has concurrent original jurisdic
tion, between subject and subject as well as otherwise, in all
cases in which a claim for relief is made or a remedy is sought
under or by virtue of Canadian maritime law or any other law
of Canada relating to any matter coming within the class of
subject of navigation and shipping, except to the extent that
jurisdiction has been otherwise specially assigned.
(2) Without limiting the generality of subsection (1), it is
hereby declared for greater certainty that the Trial Division has
jurisdiction with respect to any one or more of the following:
(a) any claim with respect to title, possession or ownership
of a ship or any part interest therein or with respect to the
proceeds of sale of a ship or any part interest therein;
(b) any question arising between co-owners of a ship with
respect to possession, employment or earnings of a ship;
(c) any claim in respect of a mortgage or hypothecation of,
or charge on, a ship or any part interest therein or any
charge in the nature of bottomry or respondentia for which a
ship or part interest therein or cargo was made security;
(d) any claim for damage or for loss of life or personal
injury caused by a ship either in collision or otherwise;
(e) any claim for damage sustained by, or for loss of, a ship
including, without restricting the generality of the foregoing,
damage to or loss of the cargo or equipment of, or any prop
erty in or on or being loaded on or off, a ship;
(fl any claim arising out of an agreement relating to the car
riage of goods on a ship under a through bill of lading or in
respect of which a through bill of lading is intended to be
issued, for loss or damage to goods occurring at any time or
place during transit;
(m) any claim in respect of goods, materials or services
wherever supplied to a ship for the operation or maintenance
of the ship, including, without restricting the generality of
the foregoing, claims in respect of stevedoring and lighter-
age;
(n) any claim arising out of a contract relating to the con
struction, repair or equipping of a ship;
(o) any claim by a master, officer or member of the crew of
a ship for wages, money, property or other remuneration or
benefits arising out of his employment;
(p) any claim by a master, charterer or agent of a ship or
shipowner in respect of disbursements, or by a shipper in
respect of advances, made on account of a ship;
(q) any claim in respect of general average contribution;
(r) any claim arising out of or in connection with a contract
of marine insurance; and
(s) any claim for dock charges, harbour dues or canal tolls
including, without restricting the generality of the foregoing,
charges for the use of facilities supplied in connection there
with.
(3) For greater certainty, it is hereby declared that the juris
diction conferred on the Court by this section is applicable
(a) in relation to all ships, whether Canadian or not and
wherever the residence or domicile of the owners may be;
(b) in relation to all aircraft where the cause of action arises
out of paragraphs (2)(j) to (1), whether those aircraft are
Canadian or not and wherever the residence or domicile of
the owners may be;
(c) in relation to all claims, whether arising on the high seas
or within the limits of the territorial, internal or other waters
of Canada or elsewhere and whether those waters are natu
rally navigable or artificially made so, including, without
restricting the generality of the foregoing, in the case of sal
vage, claims in respect of cargo or wreck found on the shore
of those waters; and
(d) in relation to all mortgages or hypothecations of, or
charges by way of security on, a ship, whether registered or
not, or whether legal or equitable, and whether created under
foreign law or not. [Underlining added.]
It is important to note two aspects of section 22.
The first is that subsection 22(1) is general in scope
and subsection 22(2) merely an illustrative or explan
atory listing of the kinds of matters which fall within
subsection 22(2). Thus, a finding that a particular
cause of action does not fall within any of the enu
merated categories of subsection 22(2) is not deter-
minative of this Court's jurisdiction.
The second aspect to note is that section 22 is the
statutory grant of jurisdiction which fills the first
requirement of the ITO tests. Section 22 is not the
federal law which nourishes that grant of jurisdiction.
That requirement is fulfilled by subsection 2(1) [as
am. by S.C. 1990, c. 8, s. 1] of the Federal Court
Act' and by various other federal statutes such as the
Canada Shipping Act [R.S.C., 1985, c. S-9].
Subsection 2(1) of the Federal Court Act provides:
2. (1)...
"Canadian maritime law" means the law that was adminis
tered by the Exchequer Court of Canada on its
Admiralty side by virtue of the Admiralty Act,
chapter A-1 of the Revised Statutes of Canada,
1970, or any other statute, or that would have been
so administered if that Court had had, on its Admi
ralty side, unlimited jurisdiction in relation to mari
time and admiralty matters, as that law has been
altered by this Act or any other Act of Parliament;
I ITO, at pp. 772-773.
To succeed in their motion to strike, the first
defendants must demonstrate that the plaintiff's cause
of action does not come within either the grant of
statutory jurisdiction set out in section 22 or does not
come within the law which nourishes that grant of
jurisdiction. Also, if the law which allegedly nour
ishes the grant of jurisdiction is ultra vires the legisla
tive authority of Parliament because it does not relate
to a subject matter set out in section 91 of the Consti
tution Act, 1867 the motion to strike should be
granted.
The first defendants argue that the facts which
have been established cannot lead to a conclusion
that the claim in question comes within this Court's
jurisdiction because the damage (if any) was not
"caused by a ship". Counsel argues that in order for
there to be "damage caused by a ship", the ship must
be the instrumentality of the damage and there must
be some act or manoeuvre of navigation involved. He
agrees that, if some part of the ship had fallen off and
fallen on top of the cars, this would be damage
caused by a ship: see, for example, The Minerva,
[1933] P. 224 and MacMillan Bloedel Ltd. v. Cana-
dian Stevedoring Co. et al., [1969] 2 Ex.C.R. 375. He
agrees that if oil or smoke had escaped from the ship
and damage had thereby been caused that this would
be damage caused by the ship: see, for example Out
house, Delma C. et al. v. Str. Thorshavn, [1935]
Ex.C.R. 120. It is argued, however, that in this case
the actions were the actions of the crew not the ship.
Heavy reliance is placed by counsel for the first
defendants on this Court's decision in Westview Sable
Fish Co. et al. v. The Ship "Neekis" (1986), 31
D.L.R. (4th) 709 (F.C.T.D.). That case concerned an
action in rem and the setting aside of a warrant for
arrest, not this Court's general admiralty jurisdiction.
That case dealt with damage caused to a plaintiff as a
result of fishing traps allegedly being taken by the
crew of the defendant ship and used by that crew for
their own fishing activities. The Court concluded at
page 711 that there was no in rem jurisdiction
because there was no damage related to navigation
which could in some way sustain an action in rem:
"The ultimate goal of the navigating of the ship is the principle
upon which the extraordinary remedy of the action in rem must
find its basis." In these particular circumstances I am not satis
fied that the allegations contained in the statement of claim can
sustain this approach. Based on all the authorities there is no
basis for a maritime lien and an action in rem arising from the
entanglement of nets, cutting of lines or the conversion of gear.
The plaintiff undoubtedly has an action against those who stole
his fishing nets but the actions can only proceed in personam
against those who committed the acts. [Underlining added.]
Counsel for the second defendant and counsel for
the plaintiff argue that the Westview Sable case is one
which is very dependent on its particular facts. It is
argued that, clearly, in the mind of the presiding
judge, the situation was one in which the crew had
stolen the fishing gear in question and in that sense
were off on a frolic of their own. They argue that
drawing a distinction between lumber falling off a
ship, oil escaping or the paint which drifted in this
case is an artificial one. They argue that no ship ever
causes damage except as a result of the actions of its
crew under the directions of its master and that the
spray painting activity in question was of this nature.
What is more, the painting was being done in order
to ensure the ship's continued seaworthiness and thus
it was integrally related to the operation of the ship.
Counsel for the first defendants argues that if there
is not some more direct physical linkage to naviga
tion than exists here, damage which is caused, for
example, by a ship being pulled over land, and falling
off a lorry would be "damage caused by a ship", or
damage resulting from the painting of a ship in dry
dock by dry dock employees would be "damage
caused by a ship". Counsel for the first defendants
argues that the proper distinction can be ascertained
by comparing the decisions in Toronto Harbour
Commissioners v. The Ship Robert C. Norton, et al.,
[ 1964] Ex.C.R. 498 and MacMillan Bloedel Ltd. v.
Canadian Stevedoring Co., et al., [1969] 2 Ex.C.R.
375. In the first case a cargo of scrap iron which had
been unloaded from a ship onto a pier was too heavy
for the pier and the pier collapsed. (I find no descrip
tion in that case as to whether the cargo was unloaded
by stevedores or by the ship's crew acting under
direction of the master.) It was held that the damage
was not "damage done by a ship" under subsection
18(2) of the Admiralty Act 2 [R.S.C. 1952, c. 1]. In
MacMillan Bloedel damage was caused as a result of
a ship rolling from side to side as it was being loaded.
Lumber was thereby thrown from the ship's deck on
to the wharf causing damage to the wharf. It was held
that the claim related to "damage done by a ship" and
was properly a matter within the jurisdiction of the
Exchequer Court. In reaching his decision, President
Jackett in the MacMillan Bloedel case said the fol
lowing at pages 386-387:
The function of a freight vessel is to receive goods, carry them
and discharge them. During all of the time that it is performing
such functions, a ship is afloat in water and must be so man
aged and controlled as to make possible the achievement of her
function.
If this is so, there seems to be no reason why an action
against the person who is alleged to have been in charge of
loading the vessel would not equally fall within that provision.
As I read the allegations .... In effect, according to the allega
tion, this defendant was in the same position as the master or
the chief officer would have been if one of them had been in
charge of the loading of the vessel.
It is argued that the distinction between the
Toronto Harbour Commissioners case and the Mac-
Millan Bloedel case is that in the first no act of navi
gation was involved while in the second, one was. I
have trouble accepting that distinction. On reading
the Toronto Harbour Commissioners case it is not
clear to me exactly who was in control of the loading
of the scrap metal onto the pier. If in both cases the
loading or unloading was under the charge of the
master (or similar person in control) and the crew,
then it is difficult to see why a distinction should
exist. In any event, that decision in so far as it relates
to this Court's maritime jurisdiction is clearly no
longer good law in the light of the Supreme Court
decision in ITO.
2 In addition it was held that the claim did not come within
s. 18(3) of the Admiralty Act as "relating to the carriage of
goods in a ship", since it related to what had been unloaded
from a ship rather than carried in a ship. It was held that the
Court had no jurisdiction to hear the claim (either against the
ship or against the Warehouse Metals Ltd. those having control
over the placing of the cargo on the pier).
It also can be noted that the Toronto Harbour Com
missioners case and some of the earlier United King
dom cases 3 , which are often cited, were decided by
reference to a statutory provision which referred to
"damage done by a ship". While the distinction does
at first glance seem slight, that wording may have a
more restrictive scope than the present paragraph
22(2)(d): "damage" caused by a ship either in colli
sion or otherwise [underlining added]. I place little
reliance however on this.
In any event, it seems to me that counsel for the
plaintiff and the second defendant are right in sug
gesting that one should adopt a functional or opera
tional test in determining when damage can be said
to be "caused by a ship" for maritime law purposes.
When the ship is afloat, the damage is the result of
actions of the crew acting under directions of its
master and those actions are integrally related to the
operation of the ship, then the damage should be clas
sified as "damage caused by a ship". This is an attrac
tive formulation of the appropriate distinction.
While I have canvassed counsel's arguments
respecting "damage caused by a ship", I am not con
vinced that I have to decide that particular issue in
order to dispose of this application. As was noted at
the beginning of these reasons, the motion before me
relates to the maritime jurisdiction of this Court, not
whether or not an in rem action lies. For the purposes
of deciding the former, in my view, all that I need
decide is whether or not the claim in question comes
within the scope of subsection 22(1) as fed by sub
section 2(1). I am convinced that it does. In the ITO
case, Mr. Justice McIntyre wrote, at page 774:
3 For example, Currie v. M'Knight, [1897] A.C. 97 (H.L.),
(at pp. 106-107):
I think it is of the essence of the rule that the damage in
respect of which a maritime lien is admitted must be
either the direct result of the natural consequence of a
wrongful act or manoeuvre of the ship to which it attaches.
Such an act or manoeuvre is necessarily due to the want of
skill or negligence of the persons by whom the vessel is
navigated; but it is, in the language of maritime law, attri
buted to the ship because the ship in their negligent or
unskilful hands is the instrument which causes the
damage.
I would agree that the historical jurisdiction of the Admi
ralty courts is significant in determining whether a particular
claim is a maritime matter within the definition of Canadian
maritime law in s. 2 of the Federal Court Act. I do not go so
far, however, as to restrict the definition of maritime and admi
ralty matters only to those claims which fit within such histori
cal limits. An historical approach may serve to enlighten, but it
must not be permitted to confine. In my view the second part
of the s. 2 definition of Canadian maritime law was adopted
for the purpose of assuring that Canadian maritime law would
include an unlimited jurisdiction in relation to maritime and
admiralty matters. As such, it constitutes a statutory recogni
tion of Canadian maritime law as a body of federal law dealing
with all claims in respect of maritime and admiralty matters.
Those matters are not to be considered as having been frozen
by The Admiralty Act, 1934. On the contrary, the words "mari-
time" and "admiralty" should be interpreted within the modern
context of commerce and shipping.
The ITO case involved the negligence of a steve-
dore-terminal operator in the short term storing of
goods within the port area pending delivery to the
consignee. It was held that this was an integral part of
carrying on the activity of shipping and had a "close,
practical relationship" to the performance of the
"contract of carriage". Similarly in this case the activ
ity which allegedly gave rise to damage is an integral
part of the activity of shipping and has a close, practi
cal relationship to the navigation of the vessel and
shipping.
Mr. Justice Iacobucci in Monk Corp. v. Island Fer
tilizers Ltd., [1991] 1 S.C.R. 779 referred to the ITO
decision as follows [at pages 795-796]:
Reduced to their essentials for purposes of this appeal, the
reasoning and conclusions of McIntyre J. were as follows (at
pp. 774-76):
(1) The second part of the s. 2 definition of Canadian maritime
law provides an unlimited jurisdiction in relation to maritime
and admiralty matters which should not be historically con
fined or frozen, and "maritime" and "admiralty" should be
interpreted within the modem context of commerce and ship
ping.
(2) Canadian maritime law is limited only by the constitutional
division of powers in the Constitution Act, 1867, such that, in
determining whether or not any particular case involves a mar
itime or admiralty matter, encroachment on what is in pith and
substance a matter falling within s. 92 of the Constitution Act
is to be avoided.
(3) The test for determining whether the subject matter under
consideration is within maritime law requires a finding that the
subject matter is so integrally connected to maritime matters as
to be legitimate Canadian maritime law within federal compe
tence.
(4) The "connecting factors" with maritime law were the prox
imity of the terminal operation to the port of Montréal, the
connection between the terminal operator in activities within
the port area and the contract of carriage by sea, and the fact
that the storage in issue in the case was short term pending
final delivery to the consignee, Miida.
McIntyre J. then concluded that the claims of Miida were
within the Federal Court's jurisdiction.
Applying the principles and approach of ITO to the case at
bar, one must begin by asking whether the claims made by
Monk are so integrally connected to maritime matters as to be
legitimate Canadian maritime law within federal competence.
[Underlining added.]
In the Monk case it was held that an action for the
recovery of costs as a result of an excess quantity of
cargo being delivered, demurrage costs and the costs
of shore cranes used to unload cargo was within the
ambit of Canadian maritime law and the Federal
Court's jurisdiction. The activities to which the
claims related were integrally connected to maritime
matters.
Similarly, in the present case, the activity which
gave rise to the statement of claim was integrally
connected to maritime matters. It was performed by
the crew on the ship and in relation to the ship pre
sumably under the direction of the master for the pur
pose of enabling the ship to carry on its navigation
operations.
Constitutional Validity
The second defendant argues that the plaintiff's
claim as against it, is not within Canadian maritime
law and is not supported by constitutionally valid
federal law. If I understand counsel for the second
defendant correctly, he argues that the claim as
against his client is based on Rylands y. Fletcher
[(1868), L.R. 3 H.L. 330] and the law of nuisance as
it relates to adjoining landowners.
Counsel for the plaintiff readily admits that if the
plaintiff's claim were based on those premises, he
would not be pursuing a claim under Canadian mari
time law. He argues, however, that this is not the
basis of the plaintiff's claim. He argues that the claim
is based on the assumption that the second defendant
had some control over the defendant ship (for exam
ple, by telling it where to berth to undertake the
painting activity). He argues that it is only as a result
of a connection to the ship that a claim is being made
against the second defendant. He admits that the
statement of claim is somewhat sparse in this regard:
5. By virtue of the negligence of the servants and agents of the
Defendant ship and/or the Second Defendant, in allowing the
paint and other noxious substances to emanate from the Defen
dant ship and/or the Second Defendant's facility, the Plaintiff
has suffered damages, particulars of which are as follows:
Damage to 402 Automobiles $200,000.00
Counsel states that this is not a pleading which he
would wish to see preserved in the precedent files of
his firm. Nevertheless, that claim has now been
pleaded over by both parties; discoveries have been
held; particulars have not been demanded.
In my view, in the light of counsel for the plain
tiff's explanation, it is too late to object to the claim
as disclosing on its face no claim against the second
defendant based on maritime law. At the very least
the plaintiff would be entitled to amend to plead the
claim with more specificity so that it was clear that it
was based on maritime law. This is a remedy the sec
ond defendant has not sought.
For the reasons given the motions to strike out the
plaintiff's statement of claim will be dismissed.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.