Canada / 22 July 2005 / Canada, Supreme Court of Canada / GreCon Dimter Inc. v. J.R. Normand Inc. and Scierie Thomas-Louis Tremblay Inc. / 30217
| Country | Canada |
| Court | Canada, Supreme Court of Canada |
| Date | 22 July 2005 |
| Parties | GreCon Dimter Inc. v. J.R. Normand Inc. and Scierie Thomas-Louis Tremblay Inc. |
| Case number | 30217 |
| Applicable NYC Provisions | II | II(3) |
| Source |
2005 SCC 46, [2005] 2 S.C.R. 401 | online: CanLII |
| Languages | English |
| Summary | The Canadian company J.R. Normand Inc. (“Normand”) bought sawmill equipment from GreCon Dimter Inc. (“GreCon”) in Germany to resell it to Scierie Thomas-Louis Tremblay Inc. (“Tremblay”) in Canada. The sales contract between GreCon and Tremblay included a choice of forum clause providing for the jurisdiction of German courts. GreCon's failure to deliver certain equipment to Normand caused the partial nonperformance of the Normand’s obligations to Tremblay. Tremblay terminated its contract with Normand and commenced court proceedings in Quebec for breach of contract. Normand brought an incidental action against GreCon in the same court. GreCon objected to the Court’s jurisdiction on the basis of the forum selection clause in the sales contract. Both the trial and appellate level courts rejected GreCon’s submission, relying on Article 3139 of the Civil Code of Quebec (“CCQ”), which requires that an incidental action be heard together with the related principal action pending before a Quebec court. With reference to the doctrine of forum non conveniens, the courts at both the trial and appellate levels favored the jurisdiction of the Quebec courts. GreCon appealed the decision to the Supreme Court of Canada. The Supreme Court of Canada granted the appeal and reversed the decisions of the lower courts favoring the jurisdiction of the Quebec courts. The Court gave primacy to the principle of party autonomy and honored the choice of forum provision that GreCon and Tremblay had included in their sales contract. In so doing, it considered the relationship between Article 3139 of the CCQ and Article 3148(2) of the CCQ, which allows parties to derogate from the jurisdiction of Quebec courts in favor of foreign courts or arbitration "in respect of a personal action of a patrimonial nature." The Supreme Court considered that “[t]he interpretation of the provisions in issue, and the resolution of the conflict between them, must necessarily be harmonized with the international commitments of Canada and Quebec”, in particular with the NYC. In its reasoning, forum selection clauses and arbitration clauses are expressions of party autonomy that serve the interest of legal certainty, particularly in international commercial relations. The Court stated that the object and purpose of the NYC, in particular Article II(3) NYC, was to strengthen the recognition and value of arbitration agreements, which confirm[s] the position that the enforcement of an arbitration agreement cannot be precluded by procedural rules relating to actions in warranty.” |
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Attachment (1)
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