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
New article published in African Journal of International and Comparative Law
A new conflict of laws article was just published today on the African Journal of International and Comparative Law. It is titled: CSA Okoli, A Yekini & P Oamen, “The Igiogbe Custom as a Mandatory Norm in Conflict of Laws: An Exploration of Nigerian Appellate Court Decisions.”
The abstract reads as follows:
Under the Igiogbe custom of the Bini Kingdom of Edo State Nigeria, the eldest surviving son exclusively inherits the ancestral home of his deceased father. This custom is a mandatory norm in conflict of laws. Litigation on the custom has been described as a matter of life and death. There is a widely shared view among academic writers, practitioners, and judges that this customary law is absolute. Contrary to this popular view, this work argues that the Igiogbe custom can be displaced by statute and other customary or religious laws. To substantiate this position, this article examines all the reported appellate court decisions on the Igiogbe custom and other connected principles. It is often taken for granted that every Bini man is subject to customary law, thereby leading to the overriding application of the Igiogbe custom. Recent developments in case law suggest otherwise. There is a conflict of personal law question that is often ignored in most litigation concerning the Igiogbe. Careful consideration of this question can potentially lead to the application of other systems of succession law (statutory, religious, and other customary laws) other than the Igiogbe custom. Besides, these conflict of laws techniques and constitutional human rights norms can be used to strike the appropriate balance between competing interests and reasonable legitimate expectations of the deceased and their heirs.
Call for papers: 2024 NGPIL Conflict of Laws’ Essay Prize
Originally posted in the NGPIL website
The Nigeria Group on Private International Law “(NGPIL”) invites submissions for the annual NGPIL Conflict of Laws’ Competition. The winner will be awarded for the best essay on any aspect of Nigerian conflict of laws. Entries will be accepted from the following: an undergraduate and/or postgraduate scholar studying in Nigeria, or any Nigerian lawyer five years call or below practising and residing in Nigeria. The essay should be unpublished at the time of submission. Submitted essays should be in the English language. Submitted essays should also be within five to eight thousand words. Competitors may be citizens of any nation, age or gender but must be an undergraduate and/or postgraduate scholar studying in Nigeria, or any lawyer below five years post-call experience practising and residing in Nigeria.
The first prize is 150,000 Naira (NGN), and the winner of the competition will be encouraged to publish the paper in any high-quality peer reviewed journal on private international law (conflict of laws). The second prize is 90,000 Naira (NGN), and third prize is 60,000 Naira (NGN). The prize is sponsored by and will be awarded by NGPIL.
Submissions to the Prize Committee must be received no later than January 15, 2024. Entries should be submitted by email in Word or pdf format. The winner will be announced no later than 2 months after the deadline. Decisions of the NGPIL on the winning essay and on any conditions relating to this prize are final. Submissions and any queries should be addressed by email to ngpilaw@gmail.com. All submissions will be acknowledged by e-mail.
Previous Winners
Oluwabusola Fagbemi (Winner for the 2022/2023 session)
Solomon Adegboyo (Winner for the 2021/2022 session)
Out Now: Torsten Kindt, Transnationale Verträge im nationalen Recht
It is a truth universally acknowledged that a significant portion of international commerce is organized around instruments and structures that do not emanate from national states and laws but from private entities. Traditionally, most legal scholars addressing this phenomenon could be sorted into one of two camps: those who want to limit the notion of ‘law’ to the state and see instances of private ordering primarily as social, rather than legal phenomena; and those who consider national law already as a abstract concept with limited and decreasing importance for the reality of international business. Torsten Kindt belongs to neither of those two camps. With his recently published book, based on his doctoral thesis, he attempts to fill the gap left between the two seemingly irreconcilable positions, with a special focus on the transnational dimension of private ordering.