A-312-74
The Ship Mesis and Transportes Intermar
Armadora, S.A. (Appellants) (Defendants)
v.
Louis Wolfe & Sons (Vancouver) Limited
(Respondent) (Plaintiff)
Court of Appeal, Jackett C.J., Pratte and Urie
JJ.—Vancouver, September 14 and 15, 1976.
Maritime law—Procedure—Appeal from ex parte order for
service out of jurisdiction—Circumstances when courts can
exercise powers outside their geographical jurisdiction—
Applicability of Rule 307 to actions in rem—Federal Court
Act, s. 46(1)(a)(vii)—Federal Court Rules 307, 1001 and 1002.
Appellants seek to set aside an ex parte order for service out
of the jurisdiction. Counsel agreed that that part of the appeal
relating to the authorization of service out of the jurisdiction on
the appellant company be discontinued.
Held, the appeal is allowed in so far as the order authorizes
service out of the jurisdiction on the ship. Rule 307 only applies
to service of legal persons who are out of the jurisdiction and
does not authorize an order permitting the Rule 1002(5)(a) or
1002(6) type of service out of the jurisdiction. Since the owner
of the ship is a named defendant, it is not necessary to decide
whether, in an action naming only the ship as defendant, an
order for personal service of the owner out of the jurisdiction
could be made under Rule 307.
APPEAL.
COUNSEL:
P. Donovan Lowry for appellants.
John I. Bird, Q.C., for respondent.
SOLICITORS:
Macrae, Montgomery, Spring & Cunning-
ham, Vancouver, for appellants.
Owen, Bird, Vancouver, for respondent.
The following are the reasons for judgment
delivered orally in English by
JACKETT C.J.: This is an appeal from an order
of the Trial Division, made on September 9, 1974,
authorizing service of notice of the statement of
claim in the action in which the order was made on
the "defendant The Ship `Mesis" wherever she
may be found and on the "defendant Transportes
Intermar Armadora, S.A." at "Embiricos Ship
ping Agency Ltd., 132 Cheapside, London,
England."
This appeal was argued at the same time as an
appeal (A-313-74) from an order of the Trial
Division, the terms of which will be referred to
later, made on October 21, 1974, upon an applica
tion inter alia to set aside the order of September
9, 1974. That appeal will be dealt with separately.
The facts and proceedings that, as it seems to
me, are relevant in so far as the two appeals are
concerned, may be summarized as follows:
1. On September 5, 1974, the respondent, as
plaintiff, filed a statement of claim entitled
"Statement of Claim—Action In Rem and In
Personam" for services supplied to the appellant
ship under agreement with its owner the appel
lant company.
2. On September 6, 1974, in support of an ex
parte application for an order inter alia for
liberty to serve a notice of the statement of
claim out of the jurisdiction on the defendant
ship and the defendant company, the "Appel-
lants" herein, the respondent filed an affidavit
the body of which reads as follows:
1. I am a member of the firm of Douglas, Symes &
Brissenden, which firm are the solicitors for the plaintiff
herein and I have personal knowledge of the facts which I
herein depose, save and except where the same are
expressed to be stated upon information and belief, in
which case I verily believe the same to be true.
2. The plaintiff claims $143,403.51 against the defend
ants herein being the balance owing to the plaintiff by the
defendants for grain fitting and cleaning services per
formed at the request of the agent for the defendant
Transportes Intermar Armadora, S.A., the owner of the
ship "Mesis" to the said ship "Mesis" in the Port of
Vancouver, British Columbia in January and February
1974.
3. I verily believe that the plaintiff has a good cause of
action in personam and in rem against the said defendants
for the said sum of $143,403.51.
4. I am advised by the plaintiff and verily believe that the
said ship "Mesis" is not presently located in the Port of
Vancouver, British Columbia. The defendant Transportes
Intermar Armadora, S.A. of Monrovia, Liberia, has an
address in the Lloyd's Register of Shipping care of
Embiricos Shipping Agency Ltd., 132 Cheapside, London,
England.
5. I am informed by the plaintiff and verily believe that
the defendant Transportes Intermar Armadora, S.A. was
in January, 1974 and is at the present time owner of the
defendant ship "Mesis".
6. I am informed by the plaintiff and verily believe that
the ship "Mesis" is presently located at the Port of
Kalama near Portland, Oregon, U.S.A. and will be leav
ing that port at some time on Wednesday, 11th September
1974.
3. On September 9, 1974, an order was made
by the Trial Division, on the ex parte applica
tion of the respondent, reading as follows:
The Notice of Statement of Claim may be served out of
the jurisdiction on defendant The Ship "Mesis" wherever
she may be found and on the defendant, Transportes
Intermar Armadora, S.A. at Embiricos Shipping Agency
Ltd., 132 Cheapside, London, England. Defendants shall
have 45 days after service to appear. Costs in the cause.
(This is the order against which this appeal has
been taken.)
4. On October 1, 1974, an affidavit was filed,
reading in part:
That I did on the 12th day of September 1974 serve the
Ship "Mesis" the above named Defendant with papers
which purported to be the original of the Notice of
Statement of Claim and a certified copy of the Order filed
in this cause in the Court on the 9th day of September,
1974, by delivering to and leaving the said original and
certified copy with George Paschalis, Chief Mate of the
said Ship "Mesis", on the Ship "Mesis".
5. Having obtained leave under Rule 401 to file
a conditional appearance, the "owners" of the
defendant vessel, "Transportes Intermar
Armadora, S.A. of Liberia" filed a conditional
appearance on October 2, 1974.
6. Pursuant to a motion made, on notice to the
respondent, by "Transportes Intermar
Armadora, S.A., the owners of the defendant
vessel", for an order that the order made by the
Trial Division on September 9 be set aside and
that any service effected pursuant thereto be
ruled ineffective, on October 21, 1974, the Trial
Division made the following order:
And upon the undertaking of counsel for the plaintiff at
the hearing of this motion to not oppose a motion by the
defendants for an extension of time to appeal the order of
the Honourable Mr. Justice Walsh of the 9th of Sept.
1974.
It is hereby ordered that, on condition that the defend
ants apply for leave to extend the time for appealing the
aforesaid order within four days from to-day, the time for
filing a statement of defence be stayed and that subject to
further order of this Court, the aforesaid stay continue
until the appeal has been heard or the matter has been
otherwise disposed of by the Court of Appeal.
No Costs.
(This is the order against which the companion
appeal has been taken.)
As already indicated this appeal is an appeal
from the order made ex parte on September 9,
1974, for service out of the jurisdiction.
Part II of the "Appellants' Factum" filed in this
Court summarizes the position of the "Appellants"
as follows:
a) There is no power in the Trial Division of the Federal
Court of Canada to make an order permitting service on a
ship that is not within the Court's jurisdiction at the time
service is effected.
b) The Notice of Motion and Affidavit before the learned
Chamber Judge on September 9th, 1974 were not adequate
support for granting an order for ex -juris and substitutional
service on the Appellant Transportes Intermar Armadora,
S.A.
The following Rules of this Court should be kept
in mind in considering the appeal.
PART III
GENERAL RULES APPLICABLE TO
PROCEEDINGS IN THE COURT
Rule 304. (1) Except in the case of an appeal from the Trial
Division to the Court of Appeal or of an action, appeal or other
proceeding against the Crown, an originating document, that is
to say, a statement of claim or declaration, a notice of appeal,
an originating notice of motion, a petition, a notice of a motion
for leave to appeal under section 31 of the Act or under any
other Act, a notice of an application under section 28 of the
Act, or other notice of an application that is not made in the
course of some other proceeding, shall be served on the defend
ant, respondent or other interested person personally.
Rule 307. (1) When a defendant, whether a Canadian citizen,
British subject or a foreigner, is out of the jurisdiction of the
Court and whether in Her Majesty's dominions or in a foreign
country, the Court, upon application, supported by affidavit or
other evidence showing that, in the belief of the deponent, the
plaintiff has a good cause of action, and showing in what place
or country such defendant is or probably may be found, may
order (Form 5) that a notice of the statement of claim or
declaration may be served on the defendant in such place or
country or within such limits as the Court thinks fit to direct.
(Form 6).
(2) An order under paragraph (1) shall fix a time, depend
ing on the place of service, within which the defendant is to file
his defence or obtain from the Court further time to do so.
Rule 309. (1) Personal service of a document upon a person
other than a corporation is effected by leaving a certified copy
of the document with the person to be served or by such other
method as may be provided by statute for the case.
(2) Personal service of a document upon a corporation is
effected by leaving a certified copy of the document
(a) in the case of a municipal corporation, with the warden,
reeve, mayor or clerk,
(b) in any case other than a municipal corporation,
(i) with the president, manager, or other head officer, the
treasurer, the secretary, the assistant treasurer, the assist
ant secretary, any•vice-president, or any person employed
by the corporation in a legal capacity, or
(ii) with the person apparently in charge, at the time of
the service, of the head office or of the branch or agency in
Canada where the service is effected, or
(c) in the case of any corporation, with any person discharg
ing duties for the particular corporation comparable to those
of an officer falling within subparagraph (a) or (b)(i),
or by such other method as may be provided by statute for the
particular case or as is provided for service of a document on a
corporation for the purposes of a superior court in the province
where the service is being effected.
Rule 310. (1) If it be made to appear to the Court that from
any cause prompt service of a document cannot be effected, the
Court may make such order for substitutional or other service
as may seem just.
Rule 401. A defendant may, by leave of the Court, file a
conditional appearance for the purpose of objecting to
(a) any irregularity in the commencement of the proceeding,
(b) the service of the statement of claim or declaration, or
notice thereof, on him, or
(c) the jurisdiction of the Court, and an order granting such
leave shall make provision for any stay of proceedings neces
sary to allow such objection to be raised and disposed of.
Rule 402....
(2) A defence may be filed
(a) within 30 days from service of the statement of claim or
declaration.
Rule 432. Where the plaintiffs claim against a defendant is
for a liquidated demand only, if that defendant has not filed a
defence, the plaintiff may, after the expiration of the period of
30 days fixed by Rule 402, apply for final judgment against
that defendant for a sum not exceeding that claimed in respect
of the demand and for costs, and proceed with the action
against the other defendant, if any.
DIVISION G
SPECIAL RULES FOR ADMIRALTY PROCEEDINGS
Rule 1000. This Division applies to proceedings in which the
Court is asked to exercise the jurisdiction conferred by section
22 of the Act, which proceedings are hereinafter referred to as
"Admiralty" proceedings.
Rule 1001. Except to the extent that they are inconsistent with
a rule in this Division, the rules applicable to other proceedings
are applicable to Admiralty proceedings.
Actions in Rem and in Personam
Rule 1002. (1) Actions shall be of two kinds, actions in rem
and actions in personam.
(2) The style of cause of the statement of claim or declara
tion in an action in rem may be in the following form:
Between:
A.B.,
Plaintiff,
and
(a) The Ship
Defendants.
(3) The style of cause of the statement of claim or declara
tion in an action in personam may be in the following form:
Between:
A.B.,
Plaintiff,
and
The Owners of the Ship
(or as the case may be),
Defendants.
(4) In the case of an action in rem, the indorsement (Form
4) on the statement of claim or declaration shall be directed to
"the owners and all others interested in the Ship
(her cargo and freight, etc., or as the case
may be)" instead of to "the Defendant within named" as in the
case of other actions.
(5) In an action in rem, the statement of claim or declara
tion shall be served
(a) upon a ship, or upon cargo, freight or other property, if
the cargo or other property is on board a ship, by attaching a
certified copy of the statement of claim or declaration to the
main mast or the single mast, or to some other conspicuous
part of the ship, and leaving the same attached thereto,
(6) If access cannot be obtained to the property upon which
a statement of claim or declaration is to be served under
paragraph (5), instead of serving it in the manner provided by
paragraph (5), it may be served personally on the person who
appears to be in charge of the property.
(7) Subject to the rules applicable to joinder of causes of
action, proceedings in rem may be joined in the same action
with proceedings in personam.
In the absence of authority by or under a stat
ute, a court cannot, in my view, exercise powers
over persons or things outside its geographical
jurisdiction. Compare In re Busfield'. The only
authority suggested for the order under attack in
this appeal is Rule 307, which is authorized by
section 46(1)(a)(vii) of the Federal Court Act.
In so far as an Admiralty action in rem under
Canadian law is a proceeding distinct from an
action against the owner and other persons inter
ested in the ship or other thing named in the style
of cause, in my view Rule 307 (which, as I read it,
only applies to service of legal persons who are out
of the jurisdiction) does not extend to authorize
service out of the jurisdiction. I am, therefore, of
opinion that Rule 307 does not authorize an order
permitting the Rule 1002(5)(a) or 1002(6) type of
service out of the jurisdiction. If the law is that an
action in rem under Canadian Admiralty law is
merely a way of compelling interested persons to
come before the Court as the real defendants,
which I doubt, then Rule 307 does authorize ser
vice of such persons out of the jurisdiction. What
ever the correct view of the nature of a Canadian
Admiralty action in rem is, in my view, Rule 307
does not authorize the Rule 1002 type of service
out of the jurisdiction. 2 In my view, not only is
Rule 307 applicable only to service on a legal
person but, having regard to the mandatory
requirements of Rule 1002(5), Rule 1001 does not
make Rule 307 applicable to the service of a
statement of claim in an action in rem. In this
case, as the owner is a named defendant to the
1 (1886) 32 Ch.D. 123, per Cotton L.J. at page 131.
2 Such service may lead to a judgment against the ship that
would support a judicial sale giving to the purchaser a title free
not only from claims by the owners but also free from claims by
any other person because such service is regarded as service on
"the owners and all others interested in the ship." In my view,
personal service on the owners or the equivalent thereof cannot
support such a judgment.
action, it is not necessary to decide whether, in an
action naming only the ship as defendant, an order
for personal service of the owner out of the juris
diction could be made under Rule 307.' In my
view, in so far as the order of September 9, 1974,
authorized a Rule 1002(5)(a) or 1002(6) type of
service, it cannot stand.
I am, therefore, of opinion that the appeal
should be allowed with costs and that, in so far as
the order appealed from authorizes service out of
the jurisdiction on the ship, it should be set aside.
Counsel for the respondent consented during
argument to leave being granted to the appellant
to discontinue this appeal without costs in so far as
it relates to that part of the order of the Trial
Division that authorizes service out of the jurisdic
tion on the defendant Transportes Intermar
Armadora, S.A.; and counsel agreed that, to that
extent, the appeal is to be deemed to be
discontinued.
* * *
PRATTE J. concurred.
* * *
URIE J. concurred.
3 When one compares the styles of cause authorized by the
Canadian Rules and the English Rules in actions in personam
and in rem since 1890 (compare the 1892 Canadian Admiralty
Rules as found in Volume 3 of the Exchequer Court Reports
and the Canadian Rules in force since that time with the Rules
adopted under the Judicature Acts of 1873 and 1875 and
subsequent United Kingdom Judicature Acts) and the respec
tive rules of the two jurisdictions for service out of the jurisdic
tion in so far as applicable in Admiralty matters, I doubt that
English jurisprudence or text books can safely be relied upon in
this connection. See, however, Aichhorn & Co. v. Ship M.V.
"Talabot" (1974) 48 A.L.J.R. 403.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.