Law Times

CaseLawLaw PAGE 18 FEDERAL COURT OF APPEAL Admiralty LIENS Choice of law clause in supply contract should generally Vessel arrested in Halifax and sold by Federal Court at re- quest of respondent mortgagees. Vessel owned by Liberian corpo- ration and managed by Greek company. Two of appellants, Kent and Praxis, incorporated under laws of British Virgin Islands, supplied fuel to vessel at ports in Spain and Trinidad. Fuel supplied pursuant to con- tracts containing United States choice-of-law provisions. Third appellant, CP3500, incorpo- rated under laws of Cyprus, ar- ranged for Singaporean supplier to provide combustion catalysts to vessel while in Singapore. CP3500's contract included ar- bitration clause providing for arbitration in Washington State. Under Canadian law supplier of necessaries to ships accorded statutory right in rem. Under United States law necessaries supplier afforded maritime lien. Statutory right in rem ranks below mortgage which is itself outranked by maritime liens. Ranking of claims to proceeds of ship's sale decided by law of forum. Appellants claimed they enjoyed maritime liens by virtue of United States choice-of-law provisions in supply contracts and argued their claims to ves- sel's judicial sale proceeds should be satisfied ahead of respondents' mortgage. Priorities judge held that each supply transaction only gave rise to statutory right in rem. Priorities appeal judge also found that appellants only had statutory rights in rem. Appeal to Federal Court of Appeal al- lowed. Choice of law clause in supply contract should generally govern maritime transactions, including rights which may arise from these transactions. Absent express or implied choice of law proper law of contract de- termined by assessing which govern maritime transactions jurisdiction has closest and most substantial connection. Where maritime transaction strongly connected to a jurisdiction, however, that jurisdiction's sub- stantive law should govern trans- action. Evidence established that manager had authority on behalf of owner to do all things neces- sary for management of vessel and all invoices addressed direct- ly to manager. Even if personal liability of ship owner necessary element, proper law of Kent and Praxis contracts, based on choice of law rules, was American law. No explicit choice of law clause in CP3500 contract but British and Canadian courts normally take arbitration clause as indica- tive of proper law of contract. United States law appropriate. Expert evidence established that United States law would recog- nize maritime lien for necessar- ies where, under supply contract governed by United States law, foreign supplier provides goods or services to foreign vessels in foreign port. Appellants proved they each had maritime lien. Kent Trade and Finance Inc. v. JP Morgan Chase Bank (Dec. 12, 2008, F.C.A., Richard C.J., Pelletier and Ryer JJ.A., File No. A-191-06) Order No. 009/022/069 (27 pp.). Immigration orders when obtained solely to defer parent's removal This was appeal of judge's dis- missal of appellant's application for judicial review. Appellant entered into Canada in 2001 and claimed Convention refu- gee status. Claim was denied and she was ordered deported. Her removal had been deferred or stayed several times. While in Canada appellant had two chil- dren. Appellant obtained cus- tody order that awarded her sole custody of children and prohib- ited their removal from Ontario. Enforcement officer refused to de- fer appellant's removal to Nigeria. Appellant's application for judicial review was dismissed. Judge held that appellant's removal, without children, would not directly con- travene custody order because it EXCLUSION AND EXPULSION Priority not given to custody April 27, 2009 • lAw Times COURT DECISIONS CaseLaw is a weekly summary of notable unreported civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada and all Ontario courts. Single or multiple copies of the full text of any case digested in this issue can be obtained by: ainmaker_LT_June2_08.indd 1 5/28/08 10:43:29 AM i) completing and mailing in the order form in this issue; or ii) calling CaseLaw's photocopy department at (905) 841-6472 in Toronto, (800) 263-3269 in Ontario and Quebec, or (800) 263-2037 in other provinces; or iii) faxing a copy of the completed order form to (905) 841-5085. did not require that she remain physically with them. Appeal dismissed. It was contrary to scheme of Immigration and Refugee Protection Act (Can.), to interpret s. 50(a) as enabling non-nationals to defer removal by obtaining custody order from provincial court on basis of best interests of children where there was no genuine dispute about custody. Parliament did not in- tend to give priority to custody orders when obtained solely to defer parent's removal and not to deal with family law dispute over custody. When text of s. 50(a) was considered in context of statutory scheme created by Act and in light of its purposes, Parliament did not intend that removal was stayed by judicial order obtained from provincial court for purpose of preventing or delaying enforcement of re- moval order. Idahosa v. Canada (Minister of Public Safety and Emergency Preparedness) (Dec. 23, 2008, F.C.A., Sexton, Evans and Ryer JJ.A., File No. A-567-07) Appeal from 162 A.C.W.S. (3d) 473, 66 Imm. L.R. (3d) 159 dismissed. Order No. 009/022/058 (21 pp.). Taxation INCOME TAX Scholarship money given by taxpayers' employer to children did not constitute employment benefit in hands of respondents This was appeal from decision of tax court judge holding that scholarship money given by re- spondent taxpayers' employer to children did not constitute em- ployment benefits in hands of respondents pursuant to s. 6(1) (a) of Income Tax Act (Can.). Respondents were employed by D.C. and respondents' chil- dren received payments from D.C. pursuant to higher edu- cation award program. D.C. paid awards directly to recipi- ents after tuition had been paid. There was no evidence that re- spondents ever received money that was paid to children. Tax Court Judge determined that respondents had not received or enjoyed benefit within meaning of s. 6(1)(a) of Act. Appeal dis- missed. Tax Court Judge made did not make palpable and over- riding error. Tax Court applied correct legal test in ask- ing whether respondents had received economic advantage measurable in monetary terms. There was no evidence that re- spondents reduced amount they would have otherwise had to paid to support children at university as result of award of scholarships to children. Canada v. Bartley; Canada v. DiMaria (Dec. 9, 2008, F.C.A., Sexton, Evans and Ryer JJ.A., File No. A-160-08; A162-08) Consolidated Case. Order No. 009/026/097 (7 pp.). Judge ONTARIO CIVIL CASES Agency TRAVEL AGENTS Travel agents failed to comply with statutory obligation to inform clients about passport or other required travel documents in invoice or receipt This was appeal of trial judge's de- cision that appellant travel agents were in breach of statutory duty to inform respondent clients with respect to passport restrictions for travel. Respondents booked pack- age vacation with appellants to Panama City. Entry into Panama City required valid Canadian passport not to expire within six months of date of travel. Respondents' passports were val- id but they expired three months from date of travel. Respondents were denied carriage by airline and could not travel. Respondents successfully claimed that appel- lants failed to comply with statu- tory obligations to inform clients about passport restrictions pursu- ant to Travel Industry Act, 2002 (Ont.). Appellants were ordered to reimburse respondents for cost of aborted trip. Appeal dismissed. Statutory duty to inform clients involved obligations before and after entering into contract. Obligation of travel agents un- der s. 38 of Act to inform clients about passport or other required travel documents in writing in invoice or receipt after purchase was not complied with. There was competing evidence about whether information was given to respondents prior to entering into contract. Trial judge pre- ferred evidence of respondents. Evidence supported made by trial judge and should not be disturbed, as there was no palpable and overriding error. Miskewycz v. Gaal (Jan. 21, 2009, Ont. S.C.J. (Div. Ct.), Wilson J., File No. 33/08) Order No. 009/028/012 (6 pp.). findings Family Law PROPERTY Increase in investment not excluded under s. 4(2) of Family Law Act (Ont.) Parties separated after 13 years of marriage. Respondent husband had managed his father's financial affairs since 1995 until his death in 2002. Respondent had invested aggressively and at date of separa- tion had grown original $500,000 into $640,000. Trial judge erred in holding that entire $640,000 should be excluded from equaliza- tion of property. While $500,000 principal amount was excluded, same could not be said of in- come stream from capital. While ordinarily income or growth on trust funds would also be held in trust for beneficiary, respondent's evidence was that he was entitled to use income for himself, which he did. Accordingly, $140,000 increase fell within definition of "property" under s. 4(1) of Family Law Act (Ont.), not be excluded under s. 4(2). Equalization payment ordered recalculated accordingly. Appeal allowed in part. Harrington v. Harrington (Jan. 19, 2009, Ont. C.A., Weiler, Juriansz and MacFarland JJ.A., File No. C47432) Appeal from 157 A.C.W.S. (3d) 384 was allowed in part. Order No. 009/020/132 (10 pp.). and should Insurance DUTY TO DEFEND Indemnity agreement required insurer to pay for Law Society member's ongoing costs of defending claim indemnify and save harmless Law Society member for costs of defending claim regarding title that its obligation to Applicant insurer sought dec- laration Your next best move? SMSS.COM CHARLOTTETOWN StewartMck_LT_Apr27_09.indd 1 Choose to have our IT expertise in your corner. FREDERICTON www.lawtimesnews.com HALIFAX MONCTON SAINT JOHN ST. JOHN'S 4/22/09 10:20:41 AM

• Cover
• Web Site Photos
• Curb Expert Bias
• Focus On IT/Telecommunications Law