Mosregion Investments Corporation v. Ukraine International Airlines

Mosregion Investments Corporation v. Ukraine International Airlines Collection Decisions of the Court of Appeal Date 2010-10-28 Neutral citation 2010 ONCA 715 Docket numbers C51774 Judges Sharpe, Robert J.; Blair, Robert Ashley; Rouleau, Paul S. Subject Civil Decision Content CITATION: Mosregion Investments Corporation v. Ukraine International Airlines, 2010 ONCA 715 DATE: 20101028 DOCKET: C51774 COURT OF APPEAL FOR ONTARIO Sharpe, Blair and Rouleau JJ.A. BETWEEN Mosregion Investments Corporation and Technopark Dimitrov Corporation and Yury Trushin Plaintiffs (Respondents) and Ukraine International Airlines, Société Air France, Greater Toronto Airports Authority, NAV Canada, Alain Rosaye, Frederic Naud and Airbus S.A.S. Defendants (Appellant) Gerard Chouest and Tae Mee Park, for the appellant Ukraine International Airlines Ernest H. Toomath and Courtney Toomath-West, for the respondents Heard: October 19, 2010 On appeal from the order of Justice Janet Wilson of the Divisional Court dated October 23, 2009, with reasons reported at (2009), 99 O.R. (3d) 49 (Div. Ct.). By the Court: [1] This appeal concerns the interpretation of the Carriage by Air Act, R.S. 1985, c. C-26, implementing the Convention for the Unification of Certain Rules Relating to International Carriage by Air, 12 October 1929, 137 L.N.T.S. 11 (the “Warsaw Convention”), which regulates liability for the international carriage of persons and property by air. The text of the Warsaw Convention is in French. Article 29 of the Warsaw Convention provides that an action “doit être intentée” (meaning “must be brought”) within two years. [2] Articles 28 and 29 of the Warsaw Convention read as follows: Article 28 (1) L’action en responsabilité devra être portée, au choix du demandeur, dans le territoire d’une des Hautes Parties Contractantes… (2) La procédure sera réglée par la loi du tribunal saisi. Article 29 (1) L’action en responsabilité doit être intentée, sous peine de déchéance, dans le délai de deux ans à compter de l’arrivée à destination ou du jour où l’aéronef aurait dû arriver, ou de l’arrêt du transport. (2) Le mode du calcul du délai est déterminé par la loi du tribunal saisi. [3] The English text of articles 28 and 29, as implemented in the Carriage by Air Act, reads as follows: Article 28 (1) An action for damages must be brought, at the option of the plaintiff, in the territory of one of the High Contracting Parties… (2) Questions of procedure shall be governed by the law of the Court seized of the case. Article 29 (1) The right to damages shall be extinguished if an action is not brought within two years, reckoned from the date of arrival at the destination, or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped. (2) The method of calculating the period of limitation shall be determined by the law of the Court seized of the case. [4] In this case, the respondents issued a notice of action against the appellant, Ukraine International Airlines, and others regarding the destruction of documents contained in an Air France jet that overran the runway and caught fire at Pearson International Airport. The notice of action was issued within the two-year limitation period. However, the respondents were not successful in serving the claim on the appellant within the six-month period provided in Ontario’s Rules of Civil Procedure. [5] The respondents brought an ex parte motion before Master Sproat for an order extending the time for service. Master Sproat adjourned the motion for notice to be served on the appellant and the other defendants who had not yet been served. The motion later returned for hearing before Master Hawkins, who granted the extension of time nunc pro tunc. The appellant did not appear on the motions. The master’s decision to extend time was consistent with this court’s decision in Brown v. Humble, [1959] O.R. 586 (C.A.). The appellant brought a motion for reconsideration before Master Dash. The basis of the motion was that notice was never received by the appellant or, in the alternative, that the appellant failed to attend through mistake or insufficient notice. Master Dash confirmed the decision, and a further appeal to the Divisional Court was dismissed. [6] In the court below, the primary issue was whether the respondents had “brought” the action when the statement of claim was issued or only when service of the claim was effected. The appellant now concedes that the action was brought upon issuance of the claim and that this occurred within the two-year limitation period. [7] In this court, the issue is presented somewhat differently. The appellant argues that the extension of time was improper because the statement of claim had expired due to the failure to effect service before the extension was obtained and that given the language of article 29, the claim had expired and could not be revived. [8] The appellant submits that the rule in Brown v. Humble has no application to a claim brought under the Warsaw Convention. Brown v. Humble dealt with a statutory limitation period. In common law jurisdictions, the expiry of a statutory limitation period does not extinguish the underlying claim, but rather creates a procedural bar to proceeding with the claim. The appellant submits that the two-year period laid down by the article 29 has a fundamentally different character and that after two years, the claim is extinguished. It follows, in the appellant’s submission, that when the statement of claim expired for want of service after the two year prescription in article 29 had expired, the Warsaw Convention claim was extinguished and there was nothing to revive. [9] We disagree. In our view, once a claim is issued within the two-year limitation period, article 29 of the Warsaw Convention has been satisfied and the claim then falls to be governed by the procedure in the jurisdiction where the claim has been issued. Any subsequent procedural requirements, including those relating to the time for service or renewal of the statement of claim, are governed by the Rules. This is apparent from article 28(2) of the Warsaw Convention, which specifically provides that the procedure of the court seized of the claim governs. Indeed, the very requirement that service must be effected within six months is provided for by the Ontario Rules, not by the terms of the Warsaw Convention. [10] Rule 3.02 of the Rules allows for the extension of time for service if the motion is brought either before or after the time for service has expired. This court’s decision in Brown v. Humble is part of the jurisprudence governing the procedure for granting extensions to claims issued in Ontario. From this decision it is apparent that an issued claim that is not served within the time frame provided in the Rules does not become a nullity. In Brown v. Humble, the court adopted the reasoning of the English Court of Appeal in Sheldon v. Brown Bayley’s Steel Wks., [1953] 2 All. E.R. 383, 894. In that case, Denning L.J. held at p. 897 that, “if a writ may be renewed after 12 months have expired that must mean that it is not then a nullity.” Similarly, Singleton L.J. commented at p. 896: I do not regard it as strictly accurate to describe a writ which has not been served within 12 months as a nullity. It is not as though it had never been issued. It is something that can be renewed. A nullity cannot be renewed. [11] Applying the Rules of Civil Procedure and this court’s decision in Brown v. Humble does not violate any of the provisions of the Warsaw Convention – once the respondents complied with the requirement in article 29 that a claim be issued within the two-year period, they brought themselves within Ontario’s Rules. Pursuant to those Rules and the jurisprudence governing them, the nunc pro tunc extension to the time for service did not amount to the bringing of a new claim; the claim had already been “intentée” and the time for service of the existing claim was extended in accordance with Ontario procedure. Accordingly, we see no error in the master’s application of the Ontario Rules, as interpreted by decisions of this court. [12] As a result, the appeal is dismissed. The respondents are entitled to costs. With respect to the quantum of costs, we agree with the appellant’s submission that a reduction in the amount sought should be made to take into account the fact that the motion for fresh evidence was unnecessary. Costs to the respondents fixed at $15,000 inclusive of disbursements and applicable taxes. “Robert J. Sharpe J.A.” “R.A. Blair J.A.” “Paul Rouleau J.A.” RELEASED: October 28, 2010