In this issue:
1. Firm and Industry News
2. Arguing about Whether to Argue now or Argue at Trial: Can Summary
Judgment Make Litigation More Accessible and Affordable?
3. Rail Carrier Allowed to Limit Liability Despite Failure to Produce
Written Signed Agreement as Required by s. 137 Canada Transportation
4. Le vol à main armée : un cas de force majeure
5. The rise of legal alchemy: how con men are creating groups of
unreasonable litigants, for profit
1. Firm and Industry News
- October 4th, New York - Association of Average
Adjuster of the United States and Canada annual meeting and dinner
- October 5th, New York - Marine Insurance
Claims Association Dinner
- November 27th, Toronto - Canadian Board
of Marine Underwriters Annual Meeting and Dinner.
- November 28th, Toronto - Commons Institute
Conference on Aviation Issues.
- November 29th, Toronto - Toronto Transportation
Club Annual Dinner
- December 7th, Montreal - Grunt Club Annual
- January 17, 2013 Toronto - Fernandes Hearn
Annual Maritime and Transportation Law Seminar
Gordon Hearn will be presenting a paper on
"The Identity Theft of Cargo: Reducing Losses and the Allocation
of Liability by the Courts" at the Canadian Board of Marine
Underwriters Annual Conference in Toronto on November 27, 2012.
Rui Fernandes will be a presenting a paper
on "Environmental Concerns in the Aftermath of an Accident"
at the Commons Institute Conference on Aviation Issues on November
28th in Toronto.
2. Arguing about
Whether to Argue now or Argue at Trial: Can Summary Judgment Make
Litigation More Accessible and Affordable?
It could - if exercised wisely. In a recent
decision a judge of the Ontario Superior Court cites concerns that
many litigants and members of the Bar may not be "getting it"
in terms of when motions for summary judgment are appropriate and
setting a litigation strategy. (*1)
The summary judgment idea is simple enough. Litigation
can be expensive. Not all lawsuits should have to proceed to a conventional
formal trial, with all the trimmings of associated delays, witnesses,
and ongoing expense. If one side's position is clear enough, and
if the law is 'on their side', why should the matter not be presented
to a judge by way of an application for "summary judgment"
today, instead of waiting for a trial by judge or a jury tomorrow?
The recent concern expressed from the Bench is that
there may be a paradoxical or an unintended effect of the summary
judgment mechanism making the system even more expensive. Perhaps
the application for summary judgment is premature if the parties
may not have yet proceeded to examinations for discovery. In the
result, perhaps a full 'record' of facts has not yet ripened. Perhaps
the application, when heard, is disposed of on the basis that the
judge determines that in fact a trial is needed in the interest
of justice. In the result, the ambition of one party seeking summary
judgment has translated into extra costs and delays for the parties.
The casual observer might cynically look upon the approach as "lawyers
arguing about arguing". Certainly from the standpoint of the
party(s) paying for the process this is cause for serious concern.
For its part, the Superior Court laments the drain on judicial resources
and the concern that procedural strangleholds on lawsuits only serve
to undermine the public's confidence in the judicial system.
The Summary Judgment Process
Rule 20 of the Ontario Rules of Civil Procedure provides
a mechanism for a party to apply to the court for "summary
judgment". The application is generally heard on the basis
of a "paper record", typically consisting of affidavits
sworn by witnesses, transcripts of cross-examinations (if conducted)
on those affidavits filed and transcripts taken from an opponent's
examination for discovery, if a party wishes to refer to it. Recently
expanded judicial powers permit a judge hearing such an application
to direct the taking of certain oral evidence from witnesses for
the purposes of weighing competing evidence presented, evaluating
the credibility of a deponent of an affidavit or to draw inferences
from the evidence. On applications for summary judgment, the parties
are to "put their best foot forward": the party seeking
judgment is to show the clarity by which that there is no genuine
issue for trial [i.e. "we can deal with this now"] whereas
the responding party has to provide a detailed case in support of
why the matter should not now be disposed of [i.e. "we need
witnesses and a detailed trial to have justice done"].
The court shall grant summary judgment if:
- the court is satisfied that there is no genuine
issue for trial with respect to a claim or a defence; or
- the parties agree to have all or part of the claim
determined by a summary judgment and the court is satisfied that
it is appropriate to grant summary judgment.
Combined Air Mechanical Inc. v. Flesch
In the March, 2012 edition of this newsletter we provided
a case comment on the decision of the 2011 decision of the Ontario
Court of Appeal Combined Air Mechanical Services Inc. v. Flesch. (*2)
The Combined Air decision articulated guiding
principles for applications for summary judgment. With the benefit
of these pronouncements, counsel and litigants could embark on a
reasoned litigation strategy: can a matter be disposed of on summary
judgment, or should it proceed to trial? The experience since the Combined Air decision however shows how theory and practice
do not always mix.
A brief review of the Combined Air guiding
principles is in order:
- The purpose of the summary judgment rule is to
eliminate unnecessary trials but not all trials;
- Generally speaking, there are three types of cases
that are amenable to summary judgment. The first is where the
parties agree to submit their dispute to resolution by way of
summary judgment. The second is where the claims or defences can
be shown to be without merit in the sense that they have no chance
of success. The third type of case concerns situations where the
trial process is not required in the "interest of justice"
to perform a final adjudication on the merits of the case;
- The judge hearing the application is to weigh the
evidence, and to the extent possible to evaluate the credibility
of a deponent of an affidavit and to draw reasonable inferences
from that evidence and determine whether there is a genuine issue
for trial. In terms of determining if there is a genuine issue
for trial, he or she must ask the following critical question:
can the full appreciation of the evidence and issues necessary
to dispose of the matter be achieved by way of summary judgment
or can this full appreciation only be achieved by way of a trial?
Developments Since the Combined Air Decision: The
"State of the Union" and George Weston Limited v. Domtar
Justice D.M. Brown of the Ontario Superior Court recently
issued a thorough analysis on the "state of the union"
of summary judgments in Ontario. The analysis is provided in the
context of a sweeping 33 page decision rendered in the context of
two cases brought before the court for summary judgment. One case
is the noted George Weston case, the other concerns the case
of 1318214 Ontario Limited et al. v. Sobeys Capital Incorporated. (*3) Justice Brown took the occasion in ruling on both applications
for summary judgment to make observations on the post-Combined
Air experience noting that there are still inefficiencies and
that matters are far from being streamlined.
Justice Brown notes that certain counsel and litigants
still have a way to go in terms of assessing the viability of motions
for summary judgment and reducing or eliminating unnecessary costs
and delays. Justice Brown issues the admonition that counsel and
litigants need to develop a responsible and efficient litigation
plan - and that "efficiency" does not necessarily applying
for summary judgment as soon as possible. Rather, the notion of
"efficiency" is in the broader of context of employing
the wisdom of deciding if a case is ripe for summary judgment -
and if so, when in the course of the lawsuit should the "harvest"
Justice Brown proceeds to make further observations
of importance to counsel and litigants being of general relevance
beyond the narrow facts of the two cases before her:
- The intent that motions for summary judgment provide
a means for resolving litigation expeditiously and with comparatively
less cost than associated with the conventional trial can be undermined
when there is a dispute as to whether an application is premature
or inappropriate bearing in mind how far an action has progressed
or the complexity of the case. "Arguing about whether to
argue" can in and of itself be both unnecessary and expensive".
Citing language from the Combined Air decision, Justice
Brown notes that:
"the inappropriate use of [summary judgment applications]
has the perverse affect of creating delays and wasted costs associated
with preparing for, arguing and deciding a motion for summary
judgment, only to see the matter having to proceed to trial".
- Several counsel are now seeking to 'stay' or prevent
an application for summary judgment being brought by an opponent
are doing so by "taking a page" out of the Combined
Air decision. In that decision the Court of Appeal stated
that a party who asserts that an application for summary judgment
is premature or inappropriate (as being sought prior to the completion
of examinations for discovery) might "move to stay or dismiss
the application on the basis that the most efficient means of
developing a record capable of satisfying the full appreciation
test is to proceed through the normal route of discovery".
This new mechanism of an application to "stay" a motion
for summary judgment could however now lead to the curious effect
of lawyers arguing about whether the case can now be argued or
whether it should be later argued at trial! (*4) In short, picture
the process now involving a motion to stay an application for
summary judgment through which the parties would argue about whether
there should be a trial
The Combined Air court noted that a party seeking to "stay"
an application for summary judgment might bring a motion for directions
pursuant to the following Rules of Civil Procedure:
1.04(1) These rules shall be liberally construed to secure the
just, most expeditious and least expensive determination of every
civil proceeding on its merits.
1.1 In applying these rules, the court shall make orders and give
directions that are proportionate to the importance and complexity
of the issues, and to the amount involved, in the proceeding.
1.05 When making an order under these rules the court may impose
such terms and give such directions as are just.
- While agreeing that the above considerations should
govern, Justice Brown however notes that it is not appropriate
in all cases to bring a "stay" application when a litigant
gets "wind" of the other side moving for summary judgment.
For example, Toronto has a "Commercial List" of law
suits, comprised of specific commercial type claims derived or
based on various statutes. For Commercial List claims, if one
party is concerned that a pending summary judgment application
is premature or inappropriate, an appointment should be made to
meet with a case conference judge rather than the bringing of
a stand alone "motion to stay strike"- thus reducing
the costs for at least one generation of court proceeding.
- For those cases for which a party chooses to move
to "stay" an application for summary judgment (perhaps
concerning a case not on the Commercial List as per point 3 above),
Justice Brown suggests the following approach to be taken on a
motion brought to stay an application for summary judgment:
- The court should look at the contemplated motion for summary
judgment and the reasonable chances of success in determining
whether a stay is appropriate. The party seeking the stay should
put their best foot forward as they would on a motion for summary
judgment to say that there is a genuine issue requiring a trial
or why the matter is too complicated for the motion judge to ascertain
the full appreciation of the case;
- The court then ought to determine whether the matter is complicated,
what are the issues; and the nature of the evidence and law to
determine the issues and whether the case could be determined
without the necessity of a full trial. The judge hearing the stay
application should consider those factors listed in rules 1.04
and 1.05 above in examining whether the proposed summary judgment
motion is a good or appropriate candidate for a summary disposition
because the "right fit" exists between, on the one hand
the nature of the issues raised on the motion and the quality
of the record which the motion will generate, on the other hand,
the summary judgment procedure.
- Where a judge faces a request to schedule a lengthy summary
judgment motion before the parties have embarked upon or
completed discoveries, the court should take into account
various factors such as the nature and complexity of the issues
raised in the action, the extent of the record that the parties
are likely to develop if a summary judgment motion proceeds prior
to the completion of discoveries and whether the records built
through affidavits and cross examinations at any early stage would
offer a less complete picture of the case that the responding
party could present at trial, and so on.
- Where a request is made to schedule a lengthy summary judgment
motion following the completion of the discovery process concerns about the appropriateness of such a motion will relate
not so much to the quality of the record developed in light of
the nature and complexity of the issues but to whether i) there
is any "upside" to spending client money and judicial
time conducting a motion-based review of the case's merits when
the parties can set the matter down for and proceed to trial and
b) as to whether the summary judgment process in the circumstances
would provide an appropriate means for effecting a fair and just
resolution of the dispute.
- Only in the clearest of cases should the court impose a stay.
- Justice Brown cites confusion on the part of certain
counsel between motions for summary judgment in Ontario with so-called
"summary trials" available in British Colombia and Alberta.
The latter permits parties, under certain circumstances, the opportunity
to conduct a trial using only a written record. By contrast, Ontario's
summary judgment mechanism does not create an alternative mode
of trial, but rather provides a mechanism by which an action may
be disposed of on its merits without proceeding to trial. This
important distinction seems to be lost amongst certain counsel
who may think that the summary judgment mechanism may be used
in and of itself to build a court 'record' of facts as distinct
from the expectation there be an existing court record for the
- Justice Brown reminds counsel and litigants that
there are benefits to the trial process itself. There is not necessarily
any loss or failure in and of itself in not 'squeezing' a matter
into summary judgment as opposed to proceeding to trial. Failed
summary judgment applications are expensive, involve degrees of
waste, and cause delay. By way of contrast, in planning for a
trial, the parties will then be assured that there will for certain
be a final disposition at the trial and expenses may be incurred
perhaps more efficiently with the trial itself in mind (as opposed
to expenses being incurred on a failed summary judgment application
hearing either as a matter of waste or duplication, in light of
the fact that the trial will take place perhaps well into the
- Justice Brown also reminds counsel and litigants
that "civil trials are capable of adapting (and indeed must
adapt) to new ways in the adjudication of cases". Counsel
are always invited to agree on facts and to consider alternative
ways of proving facts at trial other than through having to call
witnesses to make trials less expensive. Perhaps evidence can
be admitted by way of affidavit. Perhaps the parties might agree
on time limits in the examination on witnesses at trial. Parties
might also agree on having their experts meeting before trial
to come to an agreement on technical items. These are just a few
examples cited by Justice Brown as to how trials can themselves
be rendered less expensive.
If well thought out, the summary judgment mechanism
can be incredibly effective as a means to get a ruling without undue
delay on a solid claim or to root out a poor defence. The summary
judgment process is however still evolving. In several places in
her analysis Justice Brown talks for the need for a deliberate and
efficient litigation plan. This must be a product of counsel's professional
judgment and a close working relationship with the client. Sometimes
"efficiency" is not simply a function of getting things
in front of a judge as fast as possible - and some cases are simply
"meant for trial".
*1 George Weston Limited v. Domtar Inc. 2012 ONSC 5001 (CanLII)
*2 Combined Air Mechanical Inc. v. Flesch (2011) OJ 5431
*3 Court file 10-8668-00CL
*4 My cynical use of words, but this is the thrust of where Justice
Brown takes us in her analysis.
3. Rail Carrier Allowed to Limit Liability Despite
Failure to Produce Written Signed Agreement as Required by s. 137
Canada Transportation Act
In the recent British Columbia Superior Court decision
of Mitsubishi Heavy Industries Ltd. v. Canadian National Railway
Company *(1) the rail carrier was allowed to limit its liability
under a confidential rail contract even though it could not produce
a copy of the written signed agreement at trial.
Section 137 of the Canada Transportation Act provides that:
137. (1) A railway company shall not
limit or restrict its liability to a shipper for the movement
of traffic except by means of a written agreement signed by the
shipper or by an association or other body representing shippers.
A train was carrying certain aircraft parts owned
by the plaintiff Mitsubishi Heavy Industries Ltd. ("MHI")
derailed and, one of those parts was severely damaged resulting
in damages of $1.6 million. CN took the position that its liability
was limited to $50,000 pursuant to a certain contract between it
and Casco Forwarding Limited ("Casco"), who arranged for
the carriage of the aircraft parts with CN.
Casco had been employed by an freight forwarding agent
of MHI, namely Fujitrans Corporation ("Fujitrans").
The first issue was who was the "shipper"
for the purposes of section 137 of the Canada Transportation
Act. The British Columbia Superior Court judge had no problem
finding that the "shipper" was Casco - the party that
had entered into a contract with CN. In this respect the Court followed
the decisions and reasoning in three prior important decisions on
the s. 137 issue of who is a shipper. *(2)
The second, and more interesting issue, evolved from
the failure of CN to locate and produce a signed written agreement.
The Court commented on the unfairness of allowing
CN to rely on the limitation because it could not produce a signed agreement, stating:*(3)
In my view, it would be a completely unfair
and arbitrary result to hold in this case that a simple failure
to produce the written document with signatures should deny the
benefit of the limitation clause which CN negotiated in good faith
with its contractual partner, Casco. This is nothing more than
a "form over substance" result which does not do justice
between the parties.
Having arrived at this result the Court then proceeded
justify it with an analysis of the intent and purpose of the legislation.
It also then reviewed in painstaking detail the evidence showing
that MHI was aware of the limitation and was a sophisticated commercial
party. And finally it concluded in fact that there was a "signed"
written agreement. It did so by finding that an assignment of the
confidential contract (CTA-13349) by Casco had its signature on
the assignment (not on the original agreement) and that as such
the requirement of s. 137 were met. *(4)
The assignment of CTA-13349 by Casco plays
an important role in meeting the requirements under s. 137(1)
of the Act. In the present case, Mr. Weymark signed the
assignment of CTA-13349 to P&O Ports Canada Inc. By doing
so, he accepted and agreed with the terms in the assignment. The
assignment clearly indicated that CTA-13349 had been made between
Casco and MHI as the "Customer" and CN and was considered
by Casco to be an extant agreement between it and CN. While it
is somewhat unclear on the evidence, a copy of CTA-13349 was attached
to the assignment. This was the document that clearly set out
the basis upon which Casco and CN arranged for the rail services
and upon which those rail services were provided.
 Mr. Weymark's signature on the assignment
is an indication or "sign" of both Casco's agreement
and acknowledgement that the contract, CTA-13349, existed between
Casco and CN and also Casco's agreement and acknowledgement of
the underlying contractual terms of CTA-13349, which included
the limitation of liability clause.
 Section 137(1) of the Act requires
a "written agreement signed by the shipper". Mr. Weymark's
clear signature on the assignment provides a written, signed document
by which Casco agrees with or acknowledges the underlying terms
of CTA-13349. In this way, it can be said that Mr. Weymark's signature
on the assignment represented the "signing" of CTA-13349
by Casco as the shipper.
It was obvious that the judge was not comfortable
with the concept that the shipper was bound by a limitation clause
in a confidential contract to which it was not a party or privy
to. The judge took solace in the evidence which clearly showed that
MHI had actual knowledge of the limitation clause. The judge also
took comfort that even in the face of that knowledge, MHI continued
to ship its aircraft parts under CTA-13349, knowing that such a
limitation would apply. "Consent was therefore given by MHI
as to the terms by which the CN shipments would occur." Finally,
the judge took refuge in the fact that section 137 had been satisfied,
albeit in a circuitous manner.
*1 2012 BCSC 1415
*2 See Canadian National Railway Company v. Sumitomo Marine &
Fire Insurance Company Ltd., 2007 QCCA 985 (CanLII), 2007 QCCA 985,
leave to appeal to SCC refused, 32282 (February 28, 2008); Boutique
Jacob Inc. v. Pantainer Ltd., 2006 FC 217 (CanLII), 2006 FC 217,
288 F.T.R. 78, rev'd 2008 FCA 85 (CanLII), 2008 FCA 85, 375 N.R.
160; and more recently Cami Automotive, Inc. v. Westwood Shipping
Lines Inc., 2009 FC 664 (CanLII), 2009 FC 664, 351 F.T.R. 236, aff'd
2012 FCA 16 (CanLII), 2012 FCA 16, 428 N.R. 382.
*3 Paragraph 153
*4 Paragraphs 141 to 143
4. Le vol à main armée : un cas de
In a recent decision, the Quebec Superior Court
had the opportunity to review the possibility to rely on the Act
of God defence in response to a cargo claim against a carrier resulting
from an armed robbery. The Court held that yes, in some specific
circumstances, an armed robbery is irresistible and unforeseeable
and therefore amounts to an act of God as defined by the article
1470 of the Quebec Civil Code.
Le vol de cargaison est un fléau face auquel
tous les acteurs impliqués dans le transport de marchandise
doivent faire face sur une base quotidienne. Récemment, dans Ace-Ina Insurance c. Clarke Transport Inc. *(1), l'Honorable
Jean-Jude Chabot de la Cour Supérieur du Québec a
eu l'opportunité d'étudier la possibilité d'assimiler
un vol à main armée perpétré par des
malfaiteurs à un cas de force majeure.
1. Les faits
Dans cette affaire, la demanderesse Nexans Canada
Inc. (ci-après « Nexans ») avait retenu les services
de la défenderesse Clarke Transport Inc. (ci-après
« Clarke Transport ») pour le transport d'une cargaison
de rouleaux de cuivre de Montréal jusqu'à destination
de Saskatchewan. Clarke Transport a par la suite décidé
de sous-traiter la première partie du transport entre son
terminal et l'usine de Nexans en retenant les services d'un autre
transporteur, soit Lazer Transport Inc. (ci-après «
Lazer Transport »).
En cour de route, alors que la cargaison était
en la possession de Lazer Transport et de sa conductrice, celle-ci
est victime d'un détournement à main armée
commis par des malfaiteurs qui s'emparent de la cargaison et abandonnent
la conductrice dans un stationnement, les mains ligotées.
Dans sa Requête introductive d'instance, la
demanderesse Nexans plaida que la défenderesse Clarke Transport
avait une obligation de résultat en ce qui a trait à
la livraison de la cargaison pour laquelle ses services avaient
été retenus tout en précisant que la défenderesse
s'était vue remettre un document portant sur énonçant
les précautions à prendre pour éviter les détournements
et vols de cargaison.
En défense, la défenderesse Clark Transport
plaida que le vol s'était produit soudainement par voie de
détournement, qu'il avait été imprévisible
et irrésistible et que le tout était assimilable à
un cas de force majeure, la dégageant de toute responsabilité
pour la perte subie par la demanderesse Nexans.
2. La question en litige
Afin de pouvoir trancher ce litige entre la demanderesse
Nexans et la défenderesse Clark Transport, l'Honorable juge
Chabot de la Cour supérieure a dû répondre à
la question suivante :
Est-ce qu'un vol à main armée peut
constituer dans certains certaines circonstances un cas de force
3. La décision
La réponse de l'Honorable juge Chabot à
la question susmentionnée fut positive. Dans les circonstances
en l'espèce, le vol de la cargaison appartenant à
la demanderesse Nexans constituait à son avis un cas de force
majeure et par conséquent, la défenderesse Clark Transport
fut dégagée de toute responsabilité.
Au soutient de sa décision, l'éminent
juge a tenu à rappeler les deux concepts juridiques en opposition
dans cette affaire, soit tout d'abord l'obligation de résultat
pour un transporteur de délivrer le bien à destination
tel que stipulé à l'article 2049 du Code civil du
Québec et la notion de force majeure édictée
à l'article 1470 du Code civil du Québec :
2049. Le transporteur est tenu de transport le bien
Il est tenu de réparer le préjudice
résultant du transport, à moins qu'il ne prouve
que la perte d'une force majeure, du vice propre du bien ou d'une
1470. Toute personne peut se dégager de sa
responsabilité pour le préjudice causé à
autrui si elle prouve que le préjudice résulte d'une
force majeure, à moins qu'elle ne se soit engagée
à le réparer.
La force majeure est un événement
imprévisible et irrésistible, y est assimilée
la cause étrangère qui présente ces mêmes
L'Honorable juge Chabot a tenu à rappeler les
critères d'analyses du concept de force majeure:
« Ainsi pour prouver le cause de force majeure,
le débiteur de l'obligation doit prouver que l'événement
qui a causé la perte était imprévisible,
qu'il ne pouvait y résister et que cet événement
a rendu impossible l'exécution de l'obligation (voir Jean-Louis
Beaudoin et Pierre-Gabriel Jobin, Les Obligations, 6e édition,
2005, paragraphe 915). Ces mêmes auteurs définissent
la notion d'imprévisibilité comme un événement
qui n'était pas normalement prévisible pour une
personne placée dans les mêmes circonstances :
« 916 - Imprévisibilité -
La loi requiert d'abord l'imprévisibilité de l'événement
(article 1470 du Code civil). La jurisprudence, reprenant les
données de la doctrine classique, demande au débiteur
de démontrer non seulement qu'il n'a pas effectivement
prévu l'événement, mais encore que celui-ci
n'était pas normalement prévisible. Établir
le caractère imprévisible de l'événement
consiste à comparer la conduite du débiteur au
moment de la formation du contrat à celle d'un modèle
abstrait du débiteur avisé. Les tribunaux ne poussent
cependant pas cette comparaison à la limite; toute chose
est, en effet, théoriquement prévisible, même
les événements les plus inattendus. Pousser cette
exigence jusqu'au bout aurait pour effet de vider le concept
même de force majeure de son contenu. La jurisprudence
fait donc appel, encore une fois, à la notion classique,
relative, de la personne raisonnablement prudente et diligente
et se pose la question suivante : l'événement
était-il normalement prévisible pour une telle
personne placée dans les mêmes circonstances? (
Le critère d'irrésistibilité
se caractérise par le fait que toute opposition du débiteur
serait inutile ou futile ou périlleuse :
917 - Irrésistibilité - Le caractère
irrésistible de l'événement doit être
tel qu'il rende toute opposition de la part du débiteur
inutile ou futile. Celui-ci a, en effet, le devoir de tout mettre
en uvre pour fournir l'exécution, même si
un changement de circonstances a accru pour lui la difficulté
de paiement. L'événement qui rend l'exécution
simplement plus difficile, plus périlleuse ou plus coûteuse
pour le débiteur ne tombe pas dans la catégorie
des cas fortuits; en d'autres termes, l'événement
invoqué comme force majeure doit être tel qu'il
empêche l'exécution de l'obligation d'une manière
absolue et permanente. Un certain rapprochement peut être
fait ici avec la théorie de l'imprévision. Par
ailleurs, le débiteur n'est pas déchargé
si l'exécution partielle d'une obligation divisible est
encore possible ou si les effets de l'événement
ne sont que temporaires (à moins, dans ce dernier cas,
que le moment pour exécuter l'obligation ne soit essentiel).
L'impossibilité d'exécution ne saurait être
personnelle au débiteur, mais doit revêtir un caractère
général; en d'autres termes, l'événement
doit être qu'il rende l'exécution impossible pour
Quant au critère d'extériorité,
il présente un certain flottement dans la jurisprudence
et se définit comme un événement à
l'extérieur du champ de compétence du débiteur
de l'obligation. »
Dans son analyse, l'Honorable juge Chabot a retenu
que les caractères d'imprévisibilité et d'irrésistibilité
doivent obligatoirement se rattacher à l'événement
et aux obligations incombant au transporteur, qu'en l'espèce,
la conductrice n'aurait pas pu empêcher le détournement
armé de la manière dont il s'est produit et que dans
les circonstances, il n'y avait absolument rien dans le comportement
et la procédure adoptée par la conductrice qui aurait
pu constituer un manquement aux règles de sécurité
et qu'elle s'était comportée comme une personne raisonnablement
instruite dans les mêmes circonstances. Le juge a aussi retenu
le fait que des milliers d'envois qu'effectue annuellement la demanderesse
Nexans, une infime partie seulement est perdue pour cause de détournement
armé faisant en sorte que bien que possible, le risque de
détournement armé appartient plus au domaine de la
possibilité qu'à celui de la probabilité. Ainsi,
l'Honorable juge a décidé que vu les circonstances,
le vol de la cargaison était imprévisible et irrésistible
et que par conséquent il constituait un cas de force majeure.
* Il est important de noter que cette décision
a été récemment portée en appel par
*(1) Ace-Ina Insurance c. Clark Transport Inc.,
2012 QCCS 3227 (CanLII).
5. The rise of legal alchemy: how con men are creating
groups of unreasonable litigants, for profit
I had discovered, early in my researches, that
their doctrine was no mere chemical fantasy, but a philosophy they
applied to the world, to the elements, and to man himself.
W.B. Yeats - 19th Century Irish Poet
Alchemy was a medieval philosophy whose practitioners
believed that a sort of pseudo-chemistry was the secret to unlocking
vast power and wealth. The most famous of their claims was that
their special knowledge could turn lead into gold.
In recent years, an emerging alchemy has brewed in
North America. Its practitioners promise exemption from taxation,
an existence free from the authority of the state, and effortless
overnight wealth. The only things needed to unlock these amazing
gifts, so they say, are the secret words and techniques that these
gurus possess (and are willing to share, for a price).
Rather than promising power through an understanding
of magical chemistry, these gurus promise that the path to power
is through an "understanding" of the legal process. They
promise methods that unlock secret government bank accounts and
charm judges into bending at will.
There are a number of these groups in Canada and the
United States and they are becoming the bane of judges and reasonable
(and cost conscious) litigants alike.
In a recent judgment by a judge of the Alberta Court
of Queen's bench, Justice Rooke took pains to document and discredit
the methods of these legal alchemists. Having seen a growing trend
of this brand of difficult litigant clogging the courts and wasting
time and money, Justice Rooke was motivated to set a clear and authoritative
response that would serve as a warning to these practitioners and
as a handy reference guide to those dealing with them.
Justice Rooke's judgment in Meads v. Meads,
2012 ABQB 571 (CanLII) is nearly 200 pages long and is encyclopedic
in its treatment of this growing problem. To assist Justice Rooke
in the public service element of bringing awareness to this problem
and in providing solutions to it, the object of this article is
to condense his detailed judgment.
To roughly track the structure of Justice Rooke's
reasons, I divide this article into three sections (1) Who are legal
alchemists and what are their methods? (2) How can you tell if you're
dealing with a legal alchemist?, and (3) How should you respond?
Who are the legal alchemists?
What I have dubbed "legal alchemists", Justice
Rooke calls Organized Pseudolegal Commercial Argument litigants
or "OPCA litigants" for short (from paragraph 1 of his
This Court has developed a new awareness and
understanding of a category of vexatious litigant. As we shall
see, while there is often a lack of homogeneity, and some individuals
or groups have no name or special identity, they (by their own
admission or by descriptions given by others) often fall into
the following descriptions: Detaxers; Freemen or Freemen-on-the-Land;
Sovereign Men or Sovereign Citizens; Church of the Ecumenical
Redemption International (CERI); Moorish Law; and other labels
- there is no closed list. In the absence of a better moniker, I have collectively labelled them as Organized Pseudolegal
Commercial Argument litigants ["OPCA litigants"], to
functionally define them collectively for what they literally
are. These persons employ a collection of techniques and arguments
promoted and sold by 'gurus' (as hereafter defined) to disrupt
court operations and to attempt to frustrate the legal rights
of governments, corporations, and individuals.
The key to identifying OPCA litigants is to recognize
that they do not always identify as such. They may simply appear
to be "impossible" people. Since their methods and "philosophies"
are not uniform, it may be difficult to determine if you are dealing
with an OPCA litigant, or not. However, Justice Rooke explains that
there are some unifying themes (from paragraph 4):
OPCA litigants do not express any stereotypic
beliefs other than a general rejection of court and state authority;
nor do they fall into any common social or professional association.
Arguments and claims of this nature emerge in all kinds of legal
proceedings and all levels of Courts and tribunals. This group
is unified by:
1. a characteristic set of strategies (somewhat
different by group) that they employ,
2. specific but irrelevant formalities and language which they
appear to believe are (or portray as) significant, and
3. the commercial sources from which their ideas and materials
The most important thing, however, to understand about
OPCA litigants is that the central tenant of all their theories
is that they are free from any obligations to anyone.
This category of litigant shares one other critical
characteristic: they will only honour state, regulatory,
contract, family, fiduciary, equitable, and criminal obligations
if they feel like it. And typically, they don't.
Justice Rooke groups the concepts used by legal alchemists
into a limited number of categories, which are often interwoven
by a litigant in the same document or argument:
A) They are not subject to court authority,
B) All obligations (even those mandated by law) require agreement
(and they don't agree),
C) They have two selves, one natural self, free from state interference,
and a second one that is a social fiction created by the government,
with which they refuse to associate,
D) They have the power to force others to be legally obligated
to them by the use of pseudo-legalistic documents, and
E) They have the ability to access virtually unlimited government
funds through the use of more pseudo-legalistic documents.
I detail each further below.
Claim #1: They are immune from court authority
Justice Rooke writes at paragraph 267 that,
[a] very common OPCA scheme category is that
the OPCA litigant is in some manner outside the jurisdiction of
the court or state, or is somehow rendered immune from legal obligations.
This category has three general forms:
1. the jurisdiction of the court is restricted
to certain specific domains, and the OPCA litigant falls outside
2. the jurisdiction of the court is eliminated due to some defect;
3. the OPCA litigant is in some manner immunized from the court's
Challenges to jurisdiction include claims that the
court is a military or admiralty court (or conversely, that the
matter can only be heard by a military or admiralty court,
see paragraph 269), that religion trumps the courts, or that some
defect in a judge's oath or other court formalities renders the
court without authority (paragraphs 276 and 282). Other litigants
claim immunity that flows from some special status or actions taken.
As Justice Rooke calls it, the OPCA will attempt to don a "magic
hat" that purports to take the wearer outside of the jurisdiction
of the court (for instance, by claiming that they are only subject
to "Moorish Law" see paragraph 302).
Claim #2: They are immune from all laws
If OPCA litigants cannot manoeuver their way out of
the jurisdiction of the court, they try to argue that essentially
the law does not apply to them because they never agreed that it
could (from paragraphs 379-380):
A second common OPCA litigation category is grounded
in a belief that all legally enforceable rights require that a
person agree to be subject to those obligations. This strategy
takes two closely related forms:
1. every binding legal obligation emerges from
a contract, and
2. consent is required before an obligation can be enforced.
Persons who advance this concept extend it to
interactions between state actors, including Canada and the provinces,
and individual persons. This is a kind of 'magic hat'; the OPCA
litigant says he or she has not agreed to be governed or subject
to court authority, and the OPCA litigant is therefore allegedly
Claim #3: They are really two people and only one
is subject to law and (unsurprisingly) they wish only to be the
person not subject to law
If the OPCA cannot sidestep the court's jurisdiction,
and the state's authority to pass laws then, the OPCA litigant has
a third line of defence: they are really two people, only one of
whom is subject to the court and the law - the other is natural,
free and unconstrained (from paragraphs 417 and 421):
A strange but common OPCA concept is that an
individual can somehow exist in two separate but related states.
This confusing concept is expressed in many different ways. The
'physical person' is one aspect of the duality, the other is a
non-corporeal aspect that has many names, such as a "strawman"
There are different explanations for the non-corporeal
similarity. Some OPCA gurus promote the idea that this aspect
is created by the state, burdened with legal obligations, then
'shackled' to the physical person. Other OPCA gurus present the
non-corporeal aspect as a part of a person that can be split away,
and then burdened with obligations and debts.
Claim #4: They believe that they have legal authority
The fourth line of defence appears to be that 'if
others can declare laws that unilaterally bind me, then I can do
the same' (from paragraphs 447, 449).
OPCA litigants frequently attempt to unilaterally
foist obligations on other litigants, peace officers, state actors,
or the court and court personnel
Common examples of these
foisted agreements purport to appoint someone a fiduciary, establish
a contractual relationship or declare an OPCA person no longer
has an obligation, such as to pay income tax. Some purport to
unilaterally settle lawsuits or legal claims, without court direction.
Others provide a system of predetermined fines.
Claim #5: They have magic words that provide unlimited
As if promising freedom from the state and unlimited,
unilateral power over others is not enough, OPCA litigants also
believe that they can unlock unlimited wealth by use of a few legalistic
sounding words and phrases (from paragraphs 532-536):
As I understand it, A4V's guru promoters claim
that each person is associated with a secret government bank account,
which contains millions of dollars. The exact sum varies from
guru to guru
[they] claim that the government maintain these
bank accounts to monetize the state after it abandoned the gold
standard. Put another way, the theory, as I understand it, is
that people are property of the state that it uses to secure its
[they] claim that, with a correct combination of
government documents, a person can access their secret bank account
and its funds.
None of these arguments has any legal merit, but the
gurus who sell these schemes continue to profit from the gullible
that believe in them.
How can you identify them "in the wild"?
According to the judgment, legal alchemists utilize
a number of distinctive motifs in their written material and their
(1) They use unusual punctuation when writing their
name or the names of others, usually colons and dashes (for example
"James John Jones" would be written as "::james-john:
of the jones family::", see paragraph 206);
(2) Document formalities and markings such as thumbprints, postage
stamps, and the use of differently coloured inks are also common
(3) OPCA litigants use distinctive phrases and language such as
'flesh and blood man' or 'free will full liability person' (paragraph
(4) They use atypical mailing addresses; many refuse to use postal
codes (they believe use of the postal codes acknowledges state
power and therefore binds them to its laws, see paragraphs 232).
(5) OPCA legal arguments often refer to "obsolete, foreign,
or typically otherwise irrelevant legislation," such as the Magna Carta or the 1931 Statute of Westminster, and rely
on obsolete versions of Black's Law Dictionary (paragraphs
11 and 12).
In court, legal alchemists often follow strict scripts
in the mistaken belief that certain arcane words and phrases have
the power to halt or reverse the course of a proceeding. These 'scripts'
often include demands to see the oath of the judge or that the judge
prove his or her appointment. Some OPCA litigants will even demand
that the judge take a new oath of office in front of them before
Often, the OPCA litigants will give documents to judges
or opposing counsel that purport to bind these people into contracts
with the OPCA litigant (including owing substantial sums of money)
Different groups of OPCA litigants use different combinations
of these techniques. The techniques they employ depend on from which
guru they bought their kit.
How should you respond?
Justice Rooke advises any judge who faces an OPCA
litigant to use all their tools to constrain the party early in
the proceeding. The court should consider striking claims or dismissing
an action (paragraphs 586-587). In fact, Justice Rooke advocates
looking at these schemes as a form of extortion that may be exemplary
with punitive damages (paragraph 593)"
It appears to me that asserting an OPCA scheme,
particularly one that has been identified and dismissed as ineffective,
can attract punitive damages, where specifically sought by the
party opposing the OPCA litigant. The manner in which 'fee schedules'
and other foisted unilateral agreements are used seem to make
that strategy a particularly appropriate target. These documents
have no basis in law, reverse the burden of evidence, and typically
involve grotesque and unwarranted 'fines'. To quote Justice Brown,
in MBNA Canada Bank v. Luciani, 2011 ONSC 6347 at para. 3, these
are "[a] good old-fashioned shake-down!" Extortion deserves
a punitive response.
Justice Rooke also calls for elevated costs (paragraph
594-597), security for costs (paragraphs 601-602), findings of contempt,
restricting the litigants' ability to initiate or continue an action
(paragraphs 612-613). Justice Rooke also suggests having only one
judge on an OPCA litigant's matter throughout so that the litigant
is closely monitored and controlled (paragraph 610):
it makes sense that a single judge should usually
supervise a court proceeding in which OPCA activities have emerged,
and that action is an ongoing process. This may be achieved by
having a judge seize themselves of the matter, or a more formal
process such as assigning a case management judge - in our Court,
the former converts into the latter.
The bottom line is that when faced with a legal alchemist
who threatens to drag out a legal process and make it very expensive,
the suggested strategy is to bring the matter immediately before
a judge and to request his or her assistance in controlling the
legal alchemist. These are people who have been duped by con men
into believing that they are above the law and they cannot be reasoned
with. The only solution is to demonstrate early and often that,
despite what their guru has told them, they are subject to the laws
of Canada and all the penalties that come with trying to flaunt
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