Views
The Most Appropriate Forum: Assessing the Applicable Law
Another issue in the recent Supreme Court of Canada decision in Haaretz.com v Goldhar (available here) involves the applicable law as a factor in the forum non conveniens analysis. It is clear that one of the factors in determining the most appropriate forum is the applicable law. This is because it is quite easy for the forum to apply its own law and rather more difficult for it to apply the law of another jurisdiction.
So if the defendant can show that the forum would apply not its own law but rather the law of another jurisdiction, that points to a stay of proceedings in favour of that other jurisdiction. In contrast, if the plaintiff can show that the forum would apply its own law, that points against a stay of proceedings. In Haaretz.com the plaintiff was able to show that the Ontario court would apply Ontario law, not Israeli law. So the applicable law factor favoured Ontario.
Not so, argued the defendant, because an Israeli court would apply Israeli law (see para 88). So as between the two jurisdictions neither was any more convenient than the other!
In the Supreme Court of Canada, four of the judges rejected the defendant’s rejoinder. The dissenting judges held that “[i]t is entirely appropriate, in our view, for courts to only look at the chosen forum in determining the applicable law. Requiring courts to assess the choice of law rules of a foreign jurisdiction may require extensive evidence, needlessly complicating the pre-trial motion stage of the proceedings” (para 207). In separate concurring reasons, Justice Karakatsanis agreed with the dissent on this point (para 100). So because Ontario would apply Ontario law, this factor favours proceedings in Ontario rather than proceedings in Israel.
In contrast, Justice Cote, with whom Justices Brown and Rowe agreed, stated that “I am concerned that disregarding the applicable law in the alternative forum is inconsistent with the comparative nature of the forum non conveniens analysis” (para 89). She cited in support an article by Brandon Kain, Elder C. Marques and Byron Shaw (2012). The other two judges did not comment on this issue, so the court split 4-3 against looking at the applicable law in the alternative forum.
There is force to the practical concern raised by the dissent, and even with the assistance of the parties in many cases the court will be unable to form a sufficiently strong view as to what law the foreign forum would apply. But conceptually it does seem that if it is established that the foreign forum will apply its own law, that should go to negate the benefits of the plaintiff’s chosen forum applying its own law. Neither is any more convenient where compared against the other.
Perhaps because of the novelty of the approach, Justice Cote’s application of it may have missed the mark. She held that “[a]s each forum would apply its own law, the applicable law factor cannot aid Haaretz in showing that it would be fairer and more efficient to proceed in the alternative forum” (para 88). But the true point flowing from establishing that Israel would apply Israeli law, it would seem, should be that the applicable law factor cannot aid Goldhar (the plaintiff) in showing that it would be fairer and more efficient to proceed in Ontario. If it cannot aid Haaretz.com that Israel would apply its own law, then how is the factor relevant and why is the court indicating a willingness to consider it? It surely could not aid Haaretz.com that Israel would apply some other law.
On a motion for a stay, if the court did know what law would be applied in both the chosen forum and the alternative forum, we would have four possible situations. On Justice Cote’s approach, if both forums would apply their own law, this is a neutral factor. Similarly, if both forums would apply law other than forum law, this is also a neutral factor. In the other two situations, the applicable law factor favours the forum that would be applying its own law. With the court splitting 4-3 against looking at the applicable law in the alternative forum, this is not the approach – but should it be?
The Role of Foreign Enforcement Proceedings in Forum Non Conveniens
The doctrine of forum non conveniens, in looking to identify the most appropriate forum for the litigation, considers many factors. Two of these are (i) a desire to avoid, if possible, a multiplicity of proceedings and (ii) any potential difficulties in enforcing the decision that results from the litigation. However, it is important to keep these factors analytically separate.
In the Supreme Court of Canada’s recent decision in Haaretz.com v Goldhar (available here) Justice Abella noted that “enforcement concerns would favour a trial in Israel, in large part because Haaretz’s lack of assets in Ontario would mean that any order made against it would have to be enforced by Israeli courts, thereby raising concerns about a multiplicity of proceedings” (para 142). Similarly, Justice Cote concluded (paras 82-83) that the fact that an Ontario order would have to be enforced in Israel was a factor that “slightly” favoured trial in Israel.
Justice Abella has arguably conflated the two factors rather than keeping them separate. The concerns raised by a multiplicity of proceedings tend to focus on substantive proceedings rather than on subsequent procedural steps to enforce a judgment. Courts rightly try to avoid substantive proceedings in more than one jurisdiction that arise from the same factual matrix, with one of the core concerns being the potential for inconsistent findings of fact. Of course, enforcement proceedings do involve an additional step that is avoided if the judgment can simply be enforced locally. But that, in itself, should not be grouped with the kinds of concerns raised by multiple substantive proceedings. It will be unfortunate if subsequent courts routinely consider contemplated foreign enforcement proceedings as raising a multiplicity of proceedings concern.
Justice Cote (with whom Justices Brown and Rowe agreed) did not conflate enforcement proceedings and the concern about multiplicity. However, it should be noted that Club Resorts, which she referenced on this point, stated (para 110 that “problems related to the recognition and enforcement of judgments” is a relevant factor for forum non conveniens. The stress there should be on “problems”. If it can be anticipated that there may be problems enforcing the judgment where the assets are, that is an important consideration. But if no such problems are anticipated, the mere fact that enforcement elsewhere is contemplated should not point even “slightly” against the forum as the place for the litigation. In Haaretz.com the judges who consider the enforcement factor did not identify any reason to believe that enforcement proceedings in Israel would be other than routine.
The dissenting judges (Chief Justice McLachlin and Justices Moldaver and Gascon) properly separated these two factors in their analysis (paras 234-237). They did not treat enforcement proceedings as part of the analysis of a multiplicity of proceedings. On enforcement, their view was that in defamation proceedings it is often sufficient just to obtain the judgment, in vindication of the plaintiff’s reputation, and that enforcement can thus be unnecessary or “irrelevant” (para 236). Justice Cote strongly disagreed (para 83). Leaving that dispute to one side, the dissent could have also made the point that this was not a case where any “problems” had been raised about enforcement in Israel.
Staying Proceedings, Undertakings and “Buying” a Forum
One of the points of interest in the Supreme Court of Canada’s recent decision in Haaretz.com v Goldhar (available here) concerns the appropriateness of the plaintiff’s undertaking to pay the travel and accommodation costs of the defendant’s witnesses, located in Israel, to come to the trial in Ontario. The defendant had raised the issue of the residence of its witnesses as a factor pointing to Israel being the more appropriate forum. The plaintiff, one presumes, made a strategic decision to counter this factor by giving the undertaking.
The motions judge and the Court of Appeal for Ontario both considered the undertaking as effective in reducing the difficulties for the defendant in having the litigation in Ontario. However, the undertaking was viewed quite differently by at least some of the judges of the Supreme Court of Canada. Justice Cote, joined by Justices Brown and Rowe, stated that “consideration of such an undertaking would allow a wealthy plaintiff to sway the forum non conveniens analysis, which would be inimical to the foundational principles of fairness and efficiency underlying this doctrine” (para 66). Justice Abella, in separate reasons, stated “I think it would be tantamount to permitting parties with greater resources to tip the scales in their favour by ‘buying’ a forum. … it is their actual circumstances, and not artificially created ones, that should be weighed” (para 140). The other five judges (two concurring in the result reached by these four; three dissenting) did not comment on the undertaking.
Undertakings by one party in response to concerns raised by the other party on motions to stay are reasonably common. Many of these do involve some financial commitment. For example, in response to the concern that various documents will have to be translated into the language of the court, a party could undertake to cover the translation costs. Similarly, a party might undertake to cover the costs of the other party flowing from more extensive pre-trial discovery procedures in the forum. Travel and accommodation expenses are perhaps the most common subject for a financial undertaking. Is the Supreme Court of Canada now holding that these sorts of undertakings are improper?
The more general statement from Justice Abella rejecting artificially created circumstances could have an even broader scope, addressing more than just financial issues. Is it a criticism of even non-financial undertakings, such as an undertaking by the defendant not to raise a limitation period – otherwise available as a defence – in the foreign forum if the stay is granted? Is that an artificially-created circumstance?
Vaughan Black has written the leading analysis of conditional stays of proceedings in Canadian law: “Conditional Forum Non Conveniens in Canadian Courts” (2013) 39 Queen’s Law Journal 41. Undertakings are closely related to conditions. The latter are imposed by the court as a condition of its order, while the former are offered in order to influence the decision on the motion. But both deal with very similar content, and undertakings are sometimes incorporated into the order as conditions. Black observes that in some cases courts have imposed financial conditions such as paying transportation costs and even living costs during litigation (pages 69-70). Are these conditions now inappropriate, if undertakings about those expenses are? Or it is different if imposed by the court?
My view is that the four judges who made these comments in Haaretz.com have put the point too strongly. Forum non conveniens is about balancing the interests of the parties. If one party points to a particular financial hardship imposed by proceeding in a forum, it should be generally open for the other party to ameliorate this hardship by means of a financial undertaking. Only in the most extreme cases should a court consider the undertaking inappropriate. And perhaps, though the judges do not say so expressly, Haaretz.com is such a case, in that there were potentially 22 witness who would need to travel from Israel to Ontario for a trial.
News
Second Issue of ICLQ for 2023
Further to my post on first view articles for the second issue of ICLQ 2023, the second issue for ICLQ for 2023 was just published. It contains the following conflict of laws article that was not included in the first view articles:
S Camilleri, “Sense and Separability”:
This article explores the doctrine of separability, as understood in particular in the English legal tradition. It does so by reference to the decisions in Sulamérica Cia Nacional de Seguros SA and others v Enesa Engelharia SA and others and ENKA ?n?aat ve Sanayi A.?. v OOO ‘Insurance Company Chubb’ & Ors that explore the relevance of the concept when determining the law applicable to the arbitration agreement. These decisions largely treat the doctrine as irrelevant to the determination of the law governing the arbitration agreement. They do so because of the way in which English law views separability as tied inimically to the concept of enforcement of the arbitration agreement. This is unsurprising given the content of section 7 of the Arbitration Act 1996 and the position of the doctrine of separability as a legal fiction that must be restricted to its defined purpose. Viewed against the potential reform of the Arbitration Act 1996, the author asks whether a broader view of separability can be adopted. The author’s view is that there are cogent and compelling reasons for adopting a broader view, that would promote certainty and consistency in a way that is not best served by the current approach.
Conference & call for papers Sustaining Access to Justice
Save the date
On 19-20 October 2023 a conference on ‘Sustaining Access to Justice: Developments and Views on Costs and Funding’ will be held at Erasmus University Rotterdam. The conference is organised by the project team Affordable Access to Justice, financed by the Dutch Research Council. Confirmed keynote speakers include Rachael Mulheron (Queen Mary University London) and Andreas Stein (European Commission, DG Justice and Consumers, head of unit). More information on the program and registration will follow soon.
Call for papers
For this conference we invite submissions of abstracts from early career researchers and young practitioners.
The conference’s theme: Access to civil justice is of paramount importance for enforcing citizens’ rights. At the heart access to civil justice lies litigation funding and cost management. Yet, over the past decades, access to justice has been increasingly put under pressure due to retrenching governments, high costs of procedure, and inefficiency of courts and justice systems. Within this context, the funding of litigation in Europe seems to be shifting from public to private. Private actors and innovative business models emerged to provide new solutions to the old problem of financial barriers of access to justice. With the participation of policymakers, practitioners, academics and civil society representatives from all over Europe, the conference seeks to delve deeper into the financial implications of access to justice and the different ways to achieve sustainable civil justice systems in Europe. The topics addressed will include the different methods of financing dispute adjudication, particularly in the context of group litigation (third-party funding, crowdfunding, blockchain technologies), public interest litigation, developments in ADR/ODR, and the new business models of legal professionals.
Call for Papers: During the second day of the Conference (20 October) a panel will be organised which is intended to function as a forum for young scholars and young practitioners to present their work in front of a distinguished and broad audience. We particularly invite Early Career Researchers, PhD candidates (at an advanced stage of their PhD), and young practitioners to participate and present their research on the conference’s topics and beyond. While the contributions should fall within the Conference broader topic (costs and funding of civil justice), authors are free to include matters they deem interesting to explore within this context. Proposals can be theoretical, empirical as well as policy oriented. Interdisciplinary approaches and/or a Law & Economics approach are especially encouraged.
Submissions and deadline: Please submit an extended abstract (max 1000 words) in English to dori@law.eur.nl and cordina@law.eur.nl on 7 July 2023 at the latest. Please include your name, affiliation, and a link to your research profile. Submissions will be selected based on quality, originality, interdisciplinarity and the capacity to incite fruitful debates. Accepted submissions will be notified on 30 July 2023 at the latest. The selected participants will be asked to submit their final manuscript in early 2024.
The organisers aim to include the best papers in the conference proceedings, to be published as an edited volume with a reputable publisher. Further details in this regard will be communicated in due time.
Funding for travel and accommodation is available for the selected authors.
The conference venue will be @ Erasmus University Rotterdam – Woudestein Campus. The conference is organised by Erasmus School of Law in the context of the VICI Project ‘Affordable Access to Justice’. More information at: http://www.euciviljustice.eu/.
Online Panel on May 8: Fundamental Rights and PIL after the decision of the German Constitutional Court on the Act to Combat Child Marriages (in German)
On Monday, May 8, 2023, the Hamburg Max Planck Institute will host its 33th monthly virtual workshop Current Research in Private International Law at 3:00 p.m. – 5:00 p.m. (CEST). Deviating from the usual format there will be an online panel on
Fundamental Rights and PIL after the decision of the German Constitutional Court on the Act to Combat Child Marriages*
The panelist are Henning Radtke (Judge at the Constitutional Court), Dagmar Coester-Waltjen (Professor emeritus for PIL at University of Göttingen), Susanne Gössl (Professor for PIL at University of Bonn) and Lars Viellechner (Professor for Constitutional Law at University of Bremen). The discussion discussion will be in German.
After opening statements from the panelists, the discussion will be opened to the audience. All are welcome. More information and sign-up here.
If you want to be invited to these events in the future, please write to veranstaltungen@mpipriv.de.
* Information on the decision here.