In Sgromo v. Scott, 2018 ONCA 5, the Court of Appeal considered the scope of one of the presumptive grounds for jurisdiction of the Ontario Court: whether a party carried on business in Ontario. The Defendants were incorporated in jurisdictions outside of Ontario. The Defendants brought motions to stay or dismiss the subject actions.
On the motion, the Plaintiff alleged that because the products of some of the Defendants were advertised, marketed, and distributed by third party retailers in Ontario, the Defendants were carrying on business in Ontario, such that Ontario had presumptive jurisdiction. The motion judge rejected that argument.
On appeal, the Court of Appeal agreed with the motion judge’s reasons, stating that:
- as set out by the Supreme Court of Canada in Club Resorts Ltd. v. Van Breda, 2012 SCC 17 (CanLII), the Courts must be cautious when considering whether an entity is carrying on business in the jurisdiction, to avoid what would amount to assuming universal jurisdiction in respect of tort claims arising out of certain categories of business or commercial activity;
- carrying on business in Ontario requires some form of actual, not only virtual, presence in Ontario, such as maintaining an office or regularly visiting the territory of the particular jurisdiction.
The Court of Appeal added that, as the Supreme Court stated in Van Breda, even active advertising in Ontario would not be enough to establish that a defendant was carrying on business in Ontario. The Court of Appeal dismissed the appeal.
The lawyers at Gilbertson Davis LLP have experience advancing and responding to jurisdiction challenges, including in the context of international sale of goods contract disputes, international distribution litigation, and international product liability claims. Please contact us for an initial consultation.
Brief informational summaries about insurance litigation, commercial litigation and family law litigation matters in the courts of Ontario and Canada are periodically published on our website. Please note that our website content is for informational purposes only, and should not be construed or relied upon to provide legal advice. If you require legal advice, please request an initial consultation with Gilbertson Davis LLP using the Request Consultation Form on this webpage or by contacting our Intake Coordinator on (416) 979-2020, ext. 223 (both subject to the Terms of Use described on our Contact page).
Comments & Opinions by Gilbertson Davis LLP lawyers and staff on its Blog, or in media interviews, appearances or publications, or in professional publications, are personal to them, and do not necessarily represent the opinions of the Firm or anyone at the Firm other than the individual expressing those comments or opinions.
About the Author
