Kremikovtzi Trade v. Phoenix Bulk Carriers Ltd.

Kremikovtzi Trade v. Phoenix Bulk Carriers Ltd. Court (s) Database Federal Court of Appeal Decisions Date 2006-06-26 Neutral citation 2006 FCA 240 File numbers A-409-05 Decision Content Date: 20060626 Docket: A-409-05 Citation: 2006 FCA 240 CORAM: NADON J.A. SHARLOW J.A. MALONE J.A. BETWEEN: KREMIKOVTZI TRADE also known as KREMIKOVSKI TRADE Appellant and PHOENIX BULK CARRIERS LIMITED, THE CARGO OF COAL loaded on the Ship "M/V SWIFT FORTUNE" and THE OWNERS OF THE CARGO AND ALL OTHERS INTERESTED IN THE CARGO OF COAL loaded on the Ship "M/V SWIFT FORTUNE" Respondents Dealt with in writing without appearance of parties. Order delivered at Ottawa, Ontario, on June 26, 2006. REASONS FOR ORDER BY: NADON J.A. CONCURRED IN BY: SHARLOW J.A. DISSENTING REASONS BY: MALONE J.A. Date: 20060626 Docket: A-409-05 Citation: 2006 FCA 240 CORAM: NADON J.A. SHARLOW J.A. MALONE J.A. BETWEEN: KREMIKOVTZI TRADE also known as KREMIKOVSKI TRADE Appellant and PHOENIX BULK CARRIERS LIMITED, THE CARGO OF COAL loaded on the Ship "M/V SWIFT FORTUNE" and THE OWNERS OF THE CARGO AND ALL OTHERS INTERESTED IN THE CARGO OF COAL loaded on the Ship "M/V SWIFT FORTUNE" Respondents REASONS FOR ORDER NADON J.A. [1] Before us is a motion by the respondent Phoenix Bulk Carriers Limited (Phoenix) for an Order granting it leave to appeal to the Supreme Court of Canada the decision rendered by this Court on January 6, 2006, 2006 FCA 1. [2] Phoenix's motion is brought pursuant to section 37.1 of the Supreme Court Act, R.S.C. 1985, c. S-26, and Rule 357 of the Federal Courts Rules, which provide as follows: SUPREME COURT ACT 37.1 Subject to sections 39 and 42, an appeal to the Court lies with leave of the Federal Court of Appeal from a final judgment of the Federal Court of Appeal where, in its opinion, the question involved in the appeal is one that ought to be submitted to the Court for decision. **************** FEDERAL COURTS RULES 357. (1) Notwithstanding rule 352, where a judgment of the Federal Court of Appeal is delivered from the bench, a motion under section 37.1 of the Supreme Court Act for leave to appeal from the judgment to the Supreme Court of Canada may be made at the time the judgment is delivered and without prior notice. (2) A motion for leave to appeal under section 37.1 of the Supreme Court Act shall, unless the Court permits otherwise, be argued on the case, and on the reasons for judgment, from which leave to appeal is sought. (3) A motion for leave to appeal under section 37.1 of the Supreme Court Act shall be heard before not fewer than three judges, who need not be the judges who heard the matter under appeal. LOI SUR LA COUR SUPRÊME 37.1 Sous réserve des articles 39 et 42, il peut être interjeté appel devant la Cour, avec l'autorisation de la Cour d'appel fédérale, d'un jugement définitif rendu par cette dernière lorsqu'elle estime que la question en jeu devrait être soumise à la Cour. ******************** RÈGLES DE LA COUR FÉDÉRALE 357. (1) Malgré la règle 352, la requête présentée en vertu de l'article 37.1 de la Loi sur la Cour suprême pour obtenir l'autorisation d'interjeter appel, devant la Cour suprême du Canada, d'un jugement de la Cour d'appel fédérale peut être faite sans préavis, au moment où le jugement est rendu, si celui-ci est rendu à l'audience. (2) Sauf autorisation accordée par la Cour, le débat sur la requête se limite au dossier tel qu'il a été constitué devant la Cour d'appel fédérale et aux motifs du jugement à l'égard duquel la requête est faite. (3) La requête est entendue par au moins trois juges, qui peuvent ne pas être ceux qui avaient entendu l'affaire portée en appel. [3] By our decision of January 6, 2006, we allowed the appellant's appeal of an Order of the Federal Court dated September 15, 2005 (in Court file T-1558-05) and, as a result, we struck Phoenix's Statement of Claim in rem and we set aside a warrant for the arrest of a cargo of coal. [4] As appears from our Reasons for Judgment, we reluctantly concluded as we did because the point at issue had previously been decided by a panel of this Court in Paramount Enterprises International Inc. v. "AN XIN JIANG" (The), [2001] 2 F.C. 551 (FCA), and because we were of the view that it was not open to us to reverse that decision. [5] The issue in both Paramount, supra, and in the present matter is the determination of a party's right to arrest property pursuant to section 43 of the Federal Courts Act, R.S.C. 1985, c. F-7 (the Act). More particularly, in both instances, this Court was called upon to construe the words "property that is the subject of the action" found in subsection 43(2) of the Act, which provides as follows: 43. (2) Subject to subsection (3), the jurisdiction conferred on the Federal Court by section 22 may be exercised in rem against the ship, aircraft or other property that is the subject of the action, or against any proceeds from its sale that have been paid into court. 43. (2) Sous réserve du paragraphe (3), elle peut, aux termes de l'article 22, avoir compétence en matière réelle dans toute action portant sur un navire, un aéronef ou d'autres biens, ou sur le produit de leur vente consigné au tribunal. [6] Our Reasons for Judgment set out the contending views regarding the proper interpretation of the subsection. I need not repeat what we said in our Reasons for Judgment, except to say that we were of the view that the panel in Paramount, supra, had misinterpreted the subsection. We ultimately concluded that we could not overturn the decision rendered in Paramount, supra, because Phoenix had been unable to persuade us that that decision was manifestly wrong, i.e. that the Court had overlooked a relevant statutory provision or a case that ought to have been followed (see Miller v. Canada (A.G.), 2002 FCA 370). [7] I am satisfied that the question at issue is one of considerable importance to the maritime Bar and to the shipping community. There cannot be much doubt that if the interpretation accepted by this Court in Paramount, supra, prevails, the right of parties to arrest property under subsection 43(2) will be dramatically curtailed. Given that two panels of this Court have taken diverging views of the words "property that is the subject of the action", I believe that the question is one that ought to be submitted to the Supreme Court of Canada for its consideration. [8] In granting leave to appeal a decision of this Court to the Supreme Court of Canada in Prassad v. Minister of Employment and Immigration, [1985] 2 F.C. 81, Hugessen J.A. made it clear that notwithstanding that this Court's practice was to generally refuse to grant leave to appeal to the Supreme Court of Canada, allowing thereby the Supreme Court to set its own agenda, and that leave ought to be granted only in the most obvious of cases, it was this Court's duty under the applicable legislation to grant leave where, in the Court's opinion, the question at issue was one that "ought to be submitted to the Court for decision". [9] Prassad, supra, like this case, involved an important legal question that had been determined by this Court on the basis of its own prior decision. The Court considered itself bound by that decision, but there was significant disagreement within the Court as to whether the decision was correct (see the discussion in Prassad v. Canada(Minister of Employment and Immigration, [1989] 1 S.C.R. 560, at pages 572-3, per Sopinka J.). [10] In my view, the duty imposed upon us by section 37.1 of the Supreme Court Act cannot be avoided. Since the question at issue is one of law which, by reason of its importance, ought to be decided by the Supreme Court of Canada, I would grant leave to the respondent to appeal our decision of January 6, 2006. "M. Nadon" J.A. "I agree. K. Sharlow J.A." Malone j.a.(Dissenting) [11] I respectfully dissent from the reasons given by my colleagues. While I do acknowledge that the present grounds for leave do give rise to a legal issue of importance to stakeholders in the maritime law community, I would not grant leave pursuant to section 37.1 of the Supreme Court Act, R.S.C. 1985, c. S-26 (the Act). [12] While that section of the Act grants this Court the power to grant leave to appeal one of its decisions to the Supreme Court of Canada, this has been considered to be a power of an exceptional nature which should only be resorted to in the rarest of circumstances. I do not believe that the mere fact of contradictory decisions in this Court comes within the ambit of such rare circumstances. [13] Subsection 40(1) of the Act creates a concurrent leave procedure which is used regularly by other Canadian litigants who believe that their appeals give rise to questions of public importance or important legal issues that ought to be decided by the Supreme Court of Canada. In 2005, some 420 leave to appeal applications were filed while only 61 appellants were granted leave. [14] It seems to me that the principles of fairness dictate that, where possible, all leave to appeal applications to the Supreme Court of Canada should be considered by members of that Court. Panels of that Court are experienced in such matters, thus ensuring that the same review principles are consistently applied. While factors such as the public importance of a question and the importance of certain legal issues may appear obvious, other factors, such as the past practice of the Supreme Court of Canada in allowing leave applications in certain areas of law and the case load of that Court are simply unknown to outsiders. Accordingly, I would encourage the appellant to seek leave under subsection 40(1) in the normal way. "B. Malone" J.A. FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-409-05 STYLE OF CAUSE: Kremikovtzi Trade v. Phoenix Bulk Carriers Ltd. Et al. MOTION DEALT WITH IN WRITING WITHOUT APPEARANCE OF PARTIES REASONS FOR ORDER BY: NADON J.A. CONCURRED IN BY: SHARLOW J.A. DISSENTING REASONS BY: MALONE J.A. DATED: June 26, 2006 WRITTEN REPRESENTATIONS BY: John W. Bromley FOR THE APPELLANT Jean-Marie Fontaine FOR THE RESPONDENTS SOLICITORS OF RECORD: Bromley Chapelski, Barristers & Solicitors Vancouver, British Columbia FOR THE APPELLANT Borden Ladner Gervais LLP Montreal, Quebec FOR THE RESPONDENTS