Digests

Berhad v. Canada

T-609-99

2003 FC 992, Hargrave P.

20/8/03

43 pp.

Motion to strike out statement of claim on basis contains no reasonable cause of action, scandalous, frivolous, vexatious, abuse of process--Lantau Peak 249.18-metre bulk carrier of 62,112 gross metric tonnes owned by plaintiff Budisukma, managed by Maritime Consortium Management Sendirian Berhad, both of Kuala Lumpur, Malaysia--Two Canadian steamship inspectors, employed by Department of Transport, detained Lantau Peak in Vancouver in early April 1997, primarily because of wastage of ship's frames requiring major repair work as condition of release--Vessel's classification surveyor took contrary view, minor repairs having been completed, certificate of seaworthiness having been issued, vessel fit to proceed on voyage--Defendants refused to release Lantau Peak--Ship departing Vancouver August 13, 1997--Plaintiffs arguing defendants negligent as to inspection, as to criteria used to evaluate condition of Lantau Peak, generally in dealing with plaintiffs, Malaysian government--Plaintiffs now seeking damages to recoup additional cost of repair, port and other ongoing expenses, loss of use, cost of surveyors--Defendants, three years after action begun, moved to strike out statement of claim--Plaintiffs filing motion to strike out latter portion of defendants' motion--Not open to defendants to bring motion to strike out under Federal Court Rules, 1998, r. 221(1)(c), (f)--While motion to strike out for want of reasonable cause of action not brought in timely manner, proper herein motion be allowed to proceed--Canada Shipping Act, s. 310 allowing steamship inspector to board, inspect ship, to detain ship if considered unsafe, to question those in charge--To find steamship inspectors, Warna and Hall, come within jurisdiction of Federal Court, one must look to ITO-International Terminal Operators v. Miida Electronics et al., [1986] 1 S.C.R. 752, where Court set out essential requirements to support jurisdiction in Federal Court--Court not prepared to deny plaintiffs day in Court, as against steamship inspectors, Warna and Hall, on basis of want of jurisdiction--Whether Court has jurisdiction to determine matter generally, or whether ought to have gone to Minister of Transport for decision-- Proceeding herein claim for damages arising from decision(s) in part under Canada Shipping Act, also based on International Convention for the Safety of Life at Sea, 1974 (SOLAS Convention)--Term "may" in Canada Shipping Act, s. 307(1) may be discretionary or alternatively non-discretionary--SOLAS, adopted by defendants, clear as to possibility of duty, liability in instance such as present-- Standard of negligence applied by courts in determining whether duty of care breached cannot be applied to policy decision, but can be applied to operational decisions-- Arguable that decision, following inspection, to detain vessel, purely operational--Economic loss, alternate remedy arguments additional points raised by defendants under rubric of duty of care--What occurred herein more reasonably, properly characterized as operational decision--Whether there may be cause of action in negligence outside administrative remedy--Not matter of substituting opinion of classification surveyor for that of steamship inspector, but of examining what steamship inspector did in light of law of negligence-- Also improper to strike out statement of claim in negligence on basis of available alternative remedies--Important and complex case, involving overlap of many aspects of law, statutes, conventions--To deny plaintiffs at this stage would require thorough analysis of facts, something not appropriate on motion to strike out--Plaintiffs having complex action involving administrative law, statutory remedies, remedy provided by SOLAS, all serious issues which ought not to be determined on summary motion, but should await full, complete examination, on merits, by judge at trial--Agents of Crown held liable when conducting inspections negligently, without reference to what defendants characterized as tort of "negligent inspection"--Arguments of breach of statutory authority, negligent investigation, made by defendants, leading to no conclusions which would justify action being struck out--Motion dismissed--Canada Shipping Act, R.S.C., 1985, c. S-9, ss. 307 (as am. by R.S.C., 1985 (3rd Supp.), c. 6, s. 33), 310--Federal Court Act, R.S.C., 1985, c. F-7, s. 17 (as am. by S.C. 1990, c. 8, s. 3; 2002, c. 8, s. 25)--Federal Court Rules, 1998, SOR/98-106, r. 221--International Convention for the Safety of Life at Sea, 1974.