Karl Mueller Construction Ltd. v. Canada
T-464-92
Jerome A.C.J.
27/11/92
7 pp.
Plaintiff awarded contract for tank replacement and pump installation at Hay River, Northwest Territories -- Defendant terminated contract for inadequate performance -- Statement of claim disputing validity of termination -- Plaintiff moving for judgment for failure to file defence within 30 days -- Defendant seeking stay of proceedings on ground Court lacking jurisdiction to hear proposed counterclaim -- Supreme Court of Canada cases dealing with Federal Court jurisdiction reviewed -- That Federal Court may need to apply provincial law in resolution of claim not bar to jurisdiction where claim validly founded on federal law -- Determination of when provincial component so great that case no longer based on federal law more difficult particularly where jurisdictional basis for secondary claim in question -- Prior to February 1, 1992, Trial Division had statutory grant of exclusive original jurisdiction in most cases involving contractual claims against Crown -- Often resulted in action being split between courts -- Amendments to Federal Court Act granted Court concurrent jurisdiction as rule and exclusive jurisdiction only in certain situations -- Clear statutory jurisdiction for plaintiff's claim under Federal Court Act, s. 17(2)(b) as claim arising out of contract entered into by Crown, and for Crown's claim by s. 17(5)(a) as civil proceeding in which Crown claims relief -- Both claims also grounded in s. 23(c) (public work beyond limits of province) -- Common law respecting federal public works existing and applicable federal law -- Fact Crown seeking to apply principles of set-off, incorporating provincial common law, only incidental to counterclaim -- Laws of Northwest Territories "laws of Canada" -- Even common law relating to subject-matter normally within provincial jurisdiction valid federal law when concerns Territories -- Applications dismissed -- Statement of defence to be filed forthwith -- Federal Court Rules, C.R.C., c. 663, RR. 402(2)(a), 432, 433 -- Federal Court Act, R.S.C., 1985, c. F-7, ss. 17 (as am. by S.C. 1990, c. 8, s. 3), 23, 50.1 (as enacted idem, s. 16).