A-516-76
Hawker Industries Limited (Appellant) (Defend-
ant)
v.
Santa Maria Shipowning and Trading Company,
S.A. (Respondent) (Plaintiff)
Court of Appeal, Jackett C.J., Pratte and Urie
JJ.—Montreal, May 18; Ottawa, June 5, 1978.
Jurisdiction — Maritime law — Contract — Contract to
replace rudder, breached — Whether or not contract for repair
of a ship that arrives in port after becoming disabled at sea is
a subject matter falling within the body of Canadian maritime
law — Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, ss.
2, 42.
This is an appeal from a decision of the Trial Division that
respondent recover from the appellant "the amount of its
damages" resulting from the appellant's "failure ... to perform
its contract ... to be fixed at a subsequent hearing". Trial
Division's judgment is based on a finding that the respondent
made a verbal contract with the appellant for the installation of
a new rudder and a finding that the respondent suffered
damages as a result of a breach of that contract by the
appellant. The question for consideration by this Court is
whether a contract for repair of a ship that arrives in port after
becoming disabled at sea is a subject matter that falls within
the body of Canadian maritime law.
Held, the Trial Division has jurisdiction in the matter giving
rise to the judgment under appeal and therefore there should be
no judgment of this Court on the appeal at this time. Admiralty
courts throughout the centuries have exercised inter alia juris
diction over disputes concerning contracts for the provision of
necessaries to ships—albeit such jurisdiction in certain cases
may have been limited by statutory provisions or injunctions
issued by domestic courts—and in so doing have applied a body
of law that is something other than the "law of the land"
dealing with contracts and torts. Admiralty law, without any
limitations arising out of arbitrary jurisdictional fetters, falls
within the body of Canadian maritime law. A contract for the
repair of a ship disabled at sea is, and always has been
recognized as, a contract for enabling the ship to carry on its
navigation operations in the same way as a contract to provide
a ship with "necessaries" has always been so recognized. It is
not an over-generalization to say that the doing of what is
necessary to enable ships to carry on their navigation operations
is something that falls within the field of activity regulated by
admiralty law.
Associated Metals & Minerals Corp. v. The "Evie W"
[1978] 2 F.C. 710, referred to.
APPEAL.
COUNSEL:
Stewart McInnes, Q. C., and Wylie Spicer for
appellant (defendant).
Donald A. Kerr, Q.C., for respondent
(plaintiff).
SOLICITORS:
McInnes, Cooper & Robertson, Halifax, for
appellant (defendant).
Stewart, MacKeen & Covert, Halifax, for
respondent (plaintiff).
The following are the reasons for judgment
rendered in English by
JACKETT C.J.: This is an appeal from a decision
of the Trial Division [T-486-75] that the respond
ent recover from the appellant "the amount of its
damages" resulting from the appellant's "failure
... to perform its contract ... to be fixed at a
subsequent hearing" together with costs.'
The contract in question concerned a vessel
owned by the respondent, which lost its rudder at
sea and was towed into Halifax where the appel
lant carried on a business which included "ship-
repairing". The judgment of the Trial Division is
based on a finding that the respondent made a
verbal contract with the appellant to install a new
rudder and a finding that the respondent suffered
damage as a result of a breach of that contract by
the appellant.
While, in my view, they are not relevant to the
decision of what is to be decided at this time, I
deem it appropriate to refer to certain events that
have occurred since the original action was
launched, viz:
1. On February 6, 1976, this Court dismissed
an appeal from what was, in effect, a judgment
' No question has been raised as to whether the decision is
appealable under section 27 of the Federal Court Act. While
not as aptly worded as it might be, I interpret it, for the
purpose of these reasons, as "a judgment that determines a
substantive right except as to some question to be determined
by a referee" and as being, therefore, a "final judgment" by
virtue of section 27(4) of the Federal Court Act. (Such
"referee" might be a judge. See Rule 500(1).)
of the Trial Division dismissing an oral applica
tion of a co-defendant to strike out the state
ment of claim as against that defendant on the
ground that it did not disclose a cause of action
as against that defendant within the jurisdiction
of the Trial Division. The question before this
Court was whether the Trial Division wrongly
exercised its discretion as to whether the state
ment of claim should have been struck out; 2 and
the only serious contention was that there was
an implied limitation on the subject matter
jurisdiction of the Court to subject matter aris
ing within the geographical limits within which
the Court can exercise jurisdiction.
2. This appeal was launched on July 23, 1976.
3. In 1977, certain decisions of the Supreme
Court of Canada gave rise to constitutional
questions that had not previously occurred to
counsel or the Court concerning the extent of
the jurisdiction of the Trial Division in Admiral
ty matters.
As a result, on the application of the appellant, an
order was made by this Court, on November 7,
1977, for a hearing of this appeal "limited to the
question whether the Trial Division had jurisdic
tion to render the judgment appealed from". This
question has now been argued. It is apparent that
(a) if the Court decides that the Trial Division
had no jurisdiction, the appeal should be allowed
and the judgment of the Trial Division should be
set aside, and
(b) if the Court decides that the Trial Division
did have jurisdiction, arrangements should be
made for hearing of the appeal on the merits—
possibly by another Division of the Court.
It is clear that the matter falls within the juris
diction that Parliament has purported to confer by
section 22 of the Federal Court Act. The constitu
tional question that has to be considered following
the 1977 decisions of the Supreme Court of
Canada is, as I understand it, whether the judg
ment of the Trial Division in respect of that matter
2 Compare The Queen v. Wilfrid Nadeau Inc. [1973] F.C.,
1045.
is founded on
(a) provincial law, in which event it does not
fall within the "laws of Canada" in respect of
which Parliament could confer jurisdiction on
the Trial Division, or
(b) federal law, in which event it does fall
within the "laws of Canada" in respect of which
Parliament could confer jurisdiction on the Trial
Division.
Since the order providing for the preliminary
argument of this jurisdiction question—on Decem-
ber 20, 1977—this Court has come to the conclu
sion, in Associated Metals & Minerals Corpora
tion v. The "Evie W" [1978] 2 F.C. 710, that the
Trial Division has jurisdiction in a dispute con
cerning a claim arising out of a contract for the
carriage of goods by sea, in effect, on the ground
that there is a body of Canadian maritime law
(which inter alia regulates such matters) that is
federal law, and not provincial law, and therefore
falls within the class of matters that can be
assigned to the Trial Division under section 101 of
The British North America Act, 1867. In my
reasons in that case, I expressed my reasons for
reaching that conclusion and I do not propose to
repeat them at this time. 3
The only question, therefore, that, in my view,
arises for consideration by this Court at this time
is whether a contract for repair of a ship that
arrives in port after becoming disabled at sea is a
subject matter that falls within that same body of
Canadian maritime law.
In my view, no good purpose would be served by
a detailed review of statutes in relation to the
jurisdiction of Admiralty courts, cases that have
been dealt with by Admiralty courts or text books
and articles dealing with the history of Admiralty
law. 4 From my reading of such materials, I am
3 That decision is, I believe, under appeal to the Supreme
Court of Canada. Pending a decision with regard thereto, or
some other relevant decision of the Supreme Court of Canada,
in my view, we should follow the decision of this Court.
4 I should say, however, that I am indebted to Mr. Kerr,
counsel for the respondent, for putting before us extracts from
The Black Book of the Admiralty edited by Sir Travers Twiss
(1874) and for the light thereby thrown on the original Admi
ralty jurisdiction. For a brief historical review of Admiralty
jurisdiction in England, see MacMillan Bloedel Limited v.
Canadian Stevedoring Co. Ltd. [1969] 2 Ex.C.R. 375.
satisfied that Admiralty courts have throughout
the centuries exercised inter alia jurisdiction over
disputes concerning contracts for the provision of
necessaries to ships either before sailing or when
they have put into port in the course of their
voyages—albeit such jurisdiction may in certain
cases have been limited by statutory provisions or
injunctions issued by domestic courts—and, in so
doing, have applied a body of law (originally
referred to as the "law of the sea" as opposed to
the "law of the land" and commonly referred to as
"Admiralty" law) that is something other than the
"law of the land" dealing with contracts and torts.
I am satisfied that such disputes have, when they
were dealt with by Admiralty courts, been dealt
with under "Admiralty" law and not under the
ordinary domestic law that was applied when such
disputes were brought before the ordinary courts;
and such law, without any limitations arising out
of arbitrary jurisdictional fetters, falls within the
body of "Canadian maritime law" as defined by
section 2 of the Federal Court Act, which has been
continued by section 42 of that Act as part of the
substantive law of Canada. 5 (It is to be noted that
section 42 is part of a group of sections appearing
under the heading "Substantive Provisions".)
To make my view clear, I should say that, as I
grasp the situation,
(a) there was, in early times, a body of Admi
ralty law or "law of the sea" governing matters
of navigation and shipping and international
trade that was a part of the law of most mari
time nations, including England,
5 2. In this Act
"Canadian maritime law" means the law that was adminis
tered by the Exchequer Court of Canada on its Admiralty
side by virtue of the Admiralty Act or any other statute, or
that would have been so administered if that Court had
had, on its Admiralty side, unlimited jurisdiction in rela
tion to maritime and admiralty matters, as that law has
been altered by this or any other Act of the Parliament of
Canada;
42. Canadian maritime law as it was immediately before the
1st day of June 1971 continues subject to such changes therein
as may be made by this or any other Act.
(b) that, when early statutes inhibited the Eng-
lish Admiralty Court from exercising jurisdic
tion in certain matters, they neither purported
to, nor had the effect of, abolishing any part of
such law, even though, during the operation of
such inhibitions, there was no occasion to apply
certain parts thereof,
(c) that as, and to the extent that, such inhibi
tions were removed, such parts of the Admiralty
law, as amended by substantive legislation,
again became operative,
(d) that, as part of the law of England, such
Admiralty law was introduced into Canada and,
as amended by substantive legislation, was in
fact resorted to to the extent that Admiralty
courts in Canada had jurisdiction at different
periods of Canada's history,
(e) that such Admiralty law or law of the sea is
"federal" law and not provincial law and juris
diction with regard thereto can be conferred by
Parliament under section 101, and
(f) such Admiralty law, 6 as amended by sub
stantive legislation, is a part of the law that was
continued (enacted) by section 42 of the Federal
Court Act in 1971.
It remains only to say that, in my view, a
contract for the repair of a ship disabled at sea is,
and has always been recognized as, a contract for
enabling the ship to carry on its navigation opera
tions in the same way as a contract to provide a
ship with "necessaries" has always been so recog
nized; and, in my view, it is not an over-generaliza
tion to say that the doing of what is necessary to
enable ships to carry on their navigation operations
is something that falls within the field of activity
regulated by Admiralty law.
For the above reasons, I am of the view that the
Trial Division has jurisdiction in the matter giving
rise to the judgment under appeal and that there
should, therefore, be no judgment of this Court on
the appeal at this time. When the appeal is ready
for hearing on the merits, an application may be
made for an order fixing a date and place for such
6 I do not intend to suggest that, quite apart from substantive
changes by statute, the Admiralty law did not undergo develop
ment by reason of changing circumstances and times just as the
common law of England did.
hearing on the understanding that such hearing
will be a new hearing—not a continuation of the
hearing on the jurisdiction question—and may be
before a different Division of the Court.
* *
PRATTE J.: I agree.
* * *
URIE J.: I concur.
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.