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A.G. Ontario v. Pembina Exploration Canada Ltd
William Tetley*
In A.G. Ontario v. Pembina Exploration Canada Ltd,I the S.C.C. held
that an Ontario Small Claims Court has jurisdiction over Admiralty matters.
According to the author, this holding is sound, in light of the essentially
unitary nature of Canada’s court system, and in view of the potential ab-
surdity of granting concurrent jurisdiction in actions involving large sums
of money, and of denying such jurisdiction in actions involving small claims.
I. Small Claims Courts and Admiralty
Does a provincial small claims court have jurisdiction over Admiralty
matters? In particular, does the Ontario Small Claims Court have jurisdic-
tion to hear a case concerning the entanglement of a trawling net with an
unmarked gas well on Lake Erie? The answer is “yes” according to the
Supreme Court of Canada, and the conditions given for such jurisdiction,
and the logical explanation furnished by La Forest J., make this yet another
useful decision defining Canadian Admiralty jurisdiction.
II. The Constituents to Federal Court Jurisdiction over Admiralty
Before considering La Forest J.’s reasoning, I will comment briefly on
Admiralty jurisdiction in Canada, which has been slowly but methodically
developing since 1976, through the landmark decisions of McNamara Cons-
truction (Western) Ltd v. R.,2 Quebec North Shore Paper Co. v. Canadian
Pacific Ltd3 and ITO (International Terminal Operators Ltd) v. Miida Elec-
tronics Inc. (The Buenos Aires Maru).4
*Professor of Law, McGill University. The author acknowledges with thanks the assistance
of Kathleen A. Lannan, B.A., in the preparation and checking of this case note.
1[1989] 1 S.C.R. 206.
2[1977] 2 S.C.R. 654, 75 D.L.R. (3d) 273, 13 N.R. 181.
3[1977] 2 S.C.R. 1054, 9 N.R. 471.
4[1986] 1 S.C.R. 752, 28 D.L.R. 641, 34 B.L.R. 251 [hereinafter Buenos Aires Maru, cited
to S.C.R.].
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McIntyre J. in the Buenos Aires Maru summarized the findings of the
foregoing decisions by holding that there were three requirements for Federal
Court jurisdiction:
1. There must be a statutory grant of jurisdiction by the federal Parliament”
[Le., the federal statute establishing the court pursuant to s. 101 of the Cons-
titution Act, 18675 must confer upon it jurisdiction over the matter in issue].
2. There must be an existing body of federal law which is essential to the
disposition of the case and which nourishes the statutory grant ofjurisdiction”
[i.e., there must be applicable federal law in place].
3. The law on which the case is based must be “a law of Canada’ as the phrase
is used in s. 101 of the Constitution Act, 1867 [i.e., Parliament must have
legislative authority over the subject matter involved in the dispute]. 6
Subsections 22(1) and 22(2) of the Federal Court Act 7 grant the Trial Division
“concurrent original jurisdiction” over Admiralty matters. There is, of
course, federal legislative jurisdiction pursuant to s. 91(10) of the Consti-
tution Act, 1867.
III. Five Step Process
A five step process is used by La Forest J. in arriving at jurisdiction in
the case at hand. (In addition to the three steps outlined above, the juris-
diction of a provincial inferior court was also at issue.)
First, since judicial jurisdiction is not coextensive with legislative ju-
risdiction, the Court notes that s. 92(14) of the Constitution Act, 1867 grants
the provincial legislature jurisdiction over “the Administration of Justice
in the Province”, thereby giving each province the right to invest its superior
courts with jurisdiction over Admiralty and other federal matters. La Forest
J. notes that the jurisdiction of provincial superior courts over Admiralty
matters arising in a province is dependent upon “the essentially unitary
nature8 of the Canadian court system”, 9 rather than on any historical
considerations.
Secondly, this right may exist only if there is no specific exclusivity in
federal law which accords jurisdiction to the Federal Court. Of course, the
Federal Court is the major exception to the unitary court system. Subsection
22(l) of the Federal Court Act, however, makes the concurrent right abun-
5Constitution Act, 1867 (U.K.), 30 & 31 Vict., c. 3.
6Supra, note 4 at 766.
7R.S.C. 1970 (2nd Supp.), c. 10 [now R.S.C. 1985, c. F-7].
8What of course is meant here is that the Canadian court system is not a federal one such
as exists in the United States, where there is corresponding judicial authority for each level of
legislative competence.
9Supra, note 1, at 217.
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dantly clear. The Federal Court, then, unquestionably shares concurrent
Admiralty jurisdiction with provincial superior courts.
The third aspect of the judgment is key. Since provincial superior courts
derive their jurisdiction from s. 92(14) of the Constitution Act, 1867, not
solely from their particular nature as superior courts, or because Canada’s
court system is essentially unitary, it follows that the provinces may also
invest their inferior courts with a general jurisdiction which includes areas
of federal legislative authority such as Admiralty matters.
Fourthly, it is necessary that the Ontario Small Claims Court Act10
includes Admiralty matters in its general terms and does not specifically
exclude them. La Forest J. determines that the Ontario statute is broad
enough to include Admiralty matters through its conferral of jurisdiction
in s. 55 over “any action” within the prescribed monetary limits.
The fifth step arises in respect to s. 96 of the Constitution Act, 1867
which gives the federal Parliament sole authority to appoint judges of the
Superior, District and County Courts in each province. Since Small Claims
Court judges are appointed provincially, the argument was raised that s. 96
precludes them from exercising Admiralty jurisdiction. La Forest J. notes,
in response, that Admiralty Courts are not listed in s. 96 and are conse-
quently not subject to this provision. Therefore, the Small Claims Court
judges of Ontario named by the Ontario provincial government are compe-
tent to hear Admiralty matters.
IV. Overruling Heath v. Kane
A.G. Ontario v. Pembina Exploration Canada Ltd clearly overrules
Heath v. Kane.” In that case, the Ontario Court of Appeal affirmed the trial
judge’s holding that the County Court had no jurisdiction in Admiralty
matters. Mr. Justice La Forest notes that the historical jurisdiction relied
upon in Heath v. Kane is irrelevant, and with great care and skill, goes on
to demonstrate the validity of the reasoning in Balfour Guthrie (Canada)
Ltd v. Far Eastern Steamship Co.12 In Guthrie, the British Columbia Court
of Appeal refused to follow Heath v. Kane, instead holding that the County
Courts of that province were included in the grant of concurrent jurisdiction
over Admiralty matters. La Forest J. then correctly grounds his reasoning
in the case at hand upon statutory principles, which are the primary source
of law in Admiralty and jurisdictional matters. That being so, I shall not
burden the reader with any further details of the earlier decisions.
10R.S.O. 1980, c. 476.
1(1975), 10 O.R. (2d) 716 (C.A.); leave to appeal to S.C.C. dismissed (1975), 10 O.R. (2d)
716n (S.C.C.).
12(1977), 82 D.L.R. (3d) 414, 5 B.C.L.R. 60 (C.A.) [hereinafter Guthrie cited to D.L.R.].
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V. Collisions on Internal Waters
Another noteworthy aspect of the case at hand is its clear declaration
that Canadian maritime law covers collisions (or allisions) on inland waters,
and not merely those on the high seas (see s. 22(3)(c) of the Federal Court
Act). This declaration is interesting in light of The Goring,’3 where the House
of Lords recently took a restrictive view of Admiralty jurisdiction, holding
that pursuant to British statute, there was no right to salvage in England in
non-tidal waters.
VI. Interesting Comments by La Forest J. on Statutory Interpretation
Mr. Justice La Forest intersperses his reasoning on the foregoing matters
with interesting comments concerning the practical benefit of the expansion
of Admiralty jurisdiction. He notes, for example, that provincial inferior
courts routinely dispose of disputes involving federal matters, such as bills
of exchange and commercial paper, and that superior courts would be se-
verely overworked if they were the only courts which could hear matters
falling within federal legislative competence without regard to the sum in
dispute.’ 4 In addition, he declares that in light of the essentially unitary
nature of Canada’s court system, it would be illogical to limit provincial
grants of jurisdiction when any grant of jurisdiction to a federal court is
already limited’ 5 by the strict tests set out in the Buenos Aires Maru16 and
its predecessors.
La Forest J.’s observations on practicality are also useful as rules of
statutory interpretation. For example, he expresses his agreement with Farris
C.J. in Guthrie,17 that it would not make sense to interpret Parliament as
having given the Federal Court and the provincial superior courts concurrent
jurisdiction in actions involving large sums of money, yet as having declined
to grant the same convenience regarding small claims. 18 It is arguable that
this is not merely a practical consideration, but rather an attempt to divine
the intention of the legislator. At any rate, a clear reference to legislative
intent appears in La Forest J.’s comment that “Small Claims Courts were
established to lessen the burden on superior courts in cases involving re-
latively small amounts of money and to give greater access to justice to the
public.”’19
13[1988] 1 All E.R. 641 (H.L.).
14Supra, note I at 225.
“5Ibid. at 226-27.
16Supra, note 4 at 766.
7Supra, note 12.
18Supra, note I at 227.
191bid. at 225.
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VII. Summary
In summary, it may be said that the decision is not only useful in
conferring concurrent Admiralty jurisdiction on another court (in this case,
an inferior small claims court), but it also confirms the concurrent nature
of jurisdiction over Canadian maritime law. Furthermore, it reasserts that
collisions on Canadian internal waters constitute part of shipping and
navigation.
