Canada / 12 September 2011 / Federal Court of Canada / T. Co. Metals Inc v. The Vessel “Federal EMS”, Canada Moon Shipping Co. and Fednav International Ltd.
|Court||Canada, Federal Court of Canada|
|Date||12 September 2011|
|Parties||T. Co. Metals Inc v. The Vessel “Federal EMS”, Canada Moon Shipping Co. and Fednav International Ltd.|
2011 FC 1067, online: CanLII
|Summary||In 2008, T. Co. Metals LLC (“T. Co”) initiated an action against Canada Moon Shipping Co. (“Canada Moon”) and Fednav International Ltd. (“Fednav”) for damages to T. Co’s cargo while travelling from Brazil to Canada on board the Federal Ems, a ship belonging to Canada Moon. To transport the cargo, Fednav had signed a charter party with Companhia Siderurgica Paulista – COSIPA (“COSIPA”) which contained an arbitration clause providing for the resolution of disputes by three arbitrators in New York. After T. Co. initiated proceedings at the Federal Court of Canada against Fednav and Canada Moon, both filed a claim against COSIPA in the Federal Court. COSIPA then filed a motion seeking a stay of the claim in favour of arbitration in New York, relying on the arbitration clause in the charter party. The motion was dismissed by a prothonotary of the Federal Court, who found that a charter party constituted a “contract for the carriage of goods by water” as listed under Section 46 of the Marine Liability Act (“the Act”) and that, as a result, the jurisdiction of the Federal Court could not be ousted. COSIPA appealed. The Federal Court allowed the appeal and set aside the action. When debating whether “contract for the carriage of goods by water” in Section 46 of the Act was to be interpreted as including charter parties, the Federal Court held that Canada was aware of its international obligations, including its support for international arbitration agreements pursuant to the NYC, when it enacted the Act. For this reason, it considered that the term should be interpreted narrowly so as to allow the arbitration clause from the charter party to be given effect.|
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