T-193-80
Nisshin Kisen Kaisha Ltd. (Plaintiff)
v.
Canadian National Railway Company and all
other persons having claims against the plaintiff,
its Ship Japan Erica or the fund hereby to be
created (Defendants)
Trial Division, Addy J.—Vancouver, February 26;
Ottawa, April 10, 1980.
Maritime law — Motion to set aside ex parte order that
upon payment into Court of a specified amount, all other
proceedings in any court arising from collision between plain
tiffs ship and defendant's bridge be stayed — Whether claim
ant's proceedings should be stayed pending determination of
owner's right to limit liability unless owner admits liability —
Whether s. 648 of Canada Shipping Act empowers Federal
Court to issue a restraining order — Whether Federal Parlia
ment has constitutional capacity to empower Federal Court to
restrain litigant from exercising its civil rights in a provincial
superior court — Whether Federal Parliament has constitu
tional capacity to authorize Federal Court to stay civil pro
ceedings in a provincial superior court — Whether, in the
circumstances, the Court should exercise its discretion to stay
proceedings and to issue restraining order — Motion denied —
Canada Shipping Act, R.S.C. 1970, c. S-9, as amended by
R.S.C. 1970 (2nd Supp.), c. 10, ss. 647, 648 — The British
North America Act, 1867, 30 & 31 Vict., c. 3 (U.K.) [R.S.C.
1970, Appendix 11, No. 51, ss. 91(10), 92(13),(14) — Federal
Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 22.
Plaintiff instituted present action for limitation of its liability
as owner of a ship that struck and heavily damaged a bridge
owned by Canadian National Railway Company. The Court
made an ex parte order that, upon payment into Court of a
certain amount, all other proceedings arising from this event in
any court be stayed. Canadian National Railway Company
moves to set aside the order on the following grounds: a
claimant's proceedings should not be stayed pending determina
tion of owner's right to limit liability unless owner is prepared
to admit liability to claimant; the Federal Court is not empow
ered by section 648 of the Canada Shipping Act to issue a
restraining order; the Federal Parliament does not have the
constitutional capacity to empower the Federal Court to
restrain litigant from exercising its civil rights in a provincial
superior court; the Federal Parliament does not have the consti
tutional capacity to authorize the Federal Court to stay civil
proceedings in a provincial superior court or, in these circum
stances, the Court should not exercise its discretion to stay
proceedings and to issue a restraining order.
Held, the ex parte order will be confirmed, subject to certain
amendments. The objection on the basis that the admission was
incomplete must fail. Action for limitation of liability can be
instituted and prosecuted without any admission of liability, but
that liability must be either established or admitted before any
order, decree or judgment limiting liability can be granted. The
admission of liability of its very nature embodies without
specifying them, an admission of all the facts required to create
the legal liability. All admissions of fact in a pleading are
considered formal admissions and cannot be contradicted by
the party making them. However, they are only absolutely
binding for the purpose of the particular action in which they
are made. Therefore, a statement that the admission is made
for the purposes of that action only cannot add to or derogate
from the essence of an unqualified formal admission made in
any pleading. With regard to the second objection, it is clear
that section 648 does not specifically mention the power to
issue a restraining order: it refers only to the power to stay
proceedings. Every Court of superior jurisdiction must possess
the innate right of controlling its own process and to control the
actions before it. The Federal Court has the right to impose as
a condition of any person being allowed to prosecute an action
therein, a restriction against that person prosecuting in another
forum an action for the same cause or matter. As to the third
objection, section 648 does not authorize the Federal Court to
restrain a person from instituting an action in a provincial
court. Applicants must also fail on the fourth ground. Sections
647 and 648 deal with procedures directly related to the
subject-matter of navigation and shipping which is under the
exclusive jurisdiction of the Parliament of Canada. The right of
Parliament to interfere with property and civil rights exists
where such interference is necessary for the purposes of legis
lating generally and effectively in relation to matters confided
to it by The British North America Act, 1867. The Parliament
of Canada has the right to confer on a court or courts of its
choosing exclusive jurisdiction over any matter which is
reserved to its own exclusive jurisdiction by the constitution. It,
also, is entitled to exercise the right to deprive the provincial
courts of jurisdiction in this field. Since the Parliament of
Canada has the right to control civil procedures in provincial
courts pertaining to navigation and shipping, being a subject-
matter within its exclusive power to legislate, it must possess
the capacity to grant to the Federal Court a right to exercise on
its behalf, control of that procedure in certain circumstances.
Section 648 is a clear exercise of that power. As to the final
ground of objection, the circumstances weigh very heavily in
favour of a stay being granted. The present case is a classical
one for which section 648 was specifically designed. There was
a great deal of damage caused and there is a real possibility of
numerous claims. Should the limitation action succeed, this
would greatly reduce the amount of litigation not only for the
shipowner, but for many of the claimants who might save a
great deal of time as well as legal expenses and disbursements
in attempting to establish liability when liability is in fact
admitted in the limitation action.
The Ships "A. L. Smith" and "Chinook" v. The Ontario
Gravel Freighting Co. (1914) 51 S.C.R. 39, applied.
Miller v. Powell (1875) cases decided in the Court of
Session, No. 168, 4th series, Vol. 11, applied. Canadian
National Railway Co. v. Lewis [1930] Ex.C.R. 145,
applied. Valin v. Langlois (1879) 3 S.C.R. 1, applied.
Attorney General for Alberta v. Atlas Lumber Co. [1941]
S.C.R. 87, applied. British Columbia Telephone Co. v.
Marpole Towing Ltd. [1971] S.C.R. 321, referred to. The
"Abadesa" [ 1968] 1 Lloyd's Rep. 493, referred to. Trop-
wood A.G. v. Sivaco Wire & Nail Co. [1979] 2 S.C.R.
157, referred to.
MOTION.
COUNSEL:
P. D. Lowry for plaintiff.
E. Chiasson for defendants.
P. Gordon for Neptune Bulk Terminals Ltd.
J. W. Perrett for Vancouver Wharves Ltd.
M. Moseley for Saskatchewan Wheat Pool.
J. Casey for Pioneer Grain, and Burlington
Northern Inc.
D. B. Smith for Captain Jones.
SOLICITORS:
Campney & Murphy, Vancouver, for plain
tiff.
Ladner Downs, Vancouver, for defendants.
The following are the reasons for order ren
dered in English by
ADDY J.: The plaintiff instituted the present
action pursuant to section 648 of the Canada
Shipping Act' for limitation of its liability as
owner of the ship Japan Erica which, on the 12th
of October 1979, struck and heavily damaged the
bridge known as the Second Narrows Railway
Bridge spanning Vancouver Harbour. The bridge
is owned by the Canadian National Railway Com
pany, one of the defendants herein. The latter had
previously instituted an action in this Court
against the plaintiff in the present limitation of
liability action, the ship itself, the captain of the
ship and the pilot, claiming damages resulting
from the collision.
R.S.C. 1970, c. S-9, as amended by Federal Court Act,
R.S.C. 1970 (2nd Supp.), c. 10, s. 65, Schedule 11, item 5.
In the statement of claim in the present action
the plaintiff pleads that the damage was caused by
an act or omission in the navigation of the ship but
without its actual fault or privity and, therefore,
claims to be entitled to limit its liability pursuant
to section 647 of the Canada Shipping Act.
On the 18th of January 1980, following an ex
parte application of the plaintiff, an order was
issued by this Court providing, among other
things, that, upon payment into Court of $1,395,-
627.60 being the amount payable based on the
ship's tonnage pursuant to sections 647 and 651,
the following restrictions on other litigation
against the owner on this matter would apply:
5. (a) Any proceedings in any court then pending in relation to
this event shall by virtue of section 648 of the Canada Shipping
Act be stayed except for the purpose of taxation and payment
of costs; and
(b) The defendant, Canadian National Railway Company,
and all other persons having any claims against the plaintiff for
loss of or damage to property or any infringement of any rights
arising out of or resulting from this event shall thereafter be
restrained from bringing any action in any court against the
plaintiff, its ship Japan Erica and all persons who have liability
that is limited by virtue of sections 647 and 649(1) of the
Canada Shipping Act in respect of this event.
The amount above stated was in fact paid into
Court and the above-mentioned provisions of the
order became effective. The order also provided
for the usual advertising and notices to any persons
wishing to merely claim against the fund to file
notices of claim in the action and to those who
wished to contest the plaintiffs right to limit its
liability or the amount of the limitation, to file
defences in the action. It also provided for various
other procedural matters.
On the 6th of February 1980, a motion to which
the present reasons relate, was launched by the
Canadian National Railway Company and the
other defendants to set aside the above-mentioned
ex parte order. The pilot of the ship, as well as
various potential claimants or defendants in the
limitation action, some of whom were undoubtedly
alerted by the public advertisement provided for in
the ex parte order of the 18th of January 1980,
also appeared on the present motion through coun
sel and made representations. My decision was
reserved to allow counsel to submit written argu
ment. Meanwhile, the provisions of the ex parte
order were continued.
The following grounds for setting it aside were
urged upon the Court:
1. A claimant's proceedings should not be stayed
pending the determination of an owner's right to
limit liability unless the owner is prepared to
admit liability to the claimant;
2. The Federal Court is not empowered by
section 648 of the Canada Shipping Act to issue
a restraining order;
3. The Federal Parliament does not have the
constitutional capacity to empower the Federal
Court to restrain a litigant from exercising its
civil rights in a provincial superior court;
4. The Federal Parliament does not have the
constitutional capacity to authorize the Federal
Court to stay civil proceedings in a provincial
superior court;
5. Alternatively, in the circumstances of the case
at bar, this Honourable Court should not exer
cise its discretion to stay proceedings and to
issue a restraining order.
As to the first ground, the law is clear that an
action for limitation of liability can be instituted
and prosecuted without any admission of liability
on the part of a plaintiff shipowner, but that
liability must be either established or admitted
before any order, decree or judgment limiting lia
bility can be granted. See Edward Stanley Roscoe,
The Admiralty Jurisdiction and Practice of the
High Court of Justice 2 ; The Ships "A. L. Smith"
and "Chinook" v. The Ontario Gravel Freighting
Company 3 ; Edward C. Mayers, Admiralty Law
2 Fifth Edition, 1931, at pp. 242 and 243.
3 (1914) 51 S.C.R. 39 at p. 44.
and Practice in Canada'; also, David Maclachlan,
A Treatise on the Law of Merchant Shipping's at
page 97:
It is 'necessary before a decree in a limitation suit can be
obtained that the liability of the shipowner should be estab
lished by a judgment or by admission.
It seems equally true that, unless liability is
admitted or established, actions commenced to
establish it will not be stayed pending determina
tion of an owner's right to limit liability. See
Miller v. Powells at page 979:
When they [owners] admit liability the Court will proceed to
stop all actions and suits brought or to be brought for the
purpose of constituting liability. [The word in parenthesis is
mine.]
Also Michael Thomas and David Steel, British
Shipping Laws, The Merchant Shipping Acts 7 :
Where he admits liability, but not otherwise, the Court will
stay actions brought for the purpose of establishing liability.
The question arising in the present case is really
not whether there was in fact an admission of
liability but, more specifically, whether the admis
sion was too restricted. The last sentence of para
graph 2 of the statement of claim reads as follows:
For the purposes of this action, and this action only, the
Plaintiff admits liability to the Defendants up to but not
beyond the aggregate amount of "The Fund" hereby to be
created.
The relevant portions of sections 647 and 648
read as follows:
647. (I) For the purpose of this section and sections 648 to
653
(2) The owner of a ship, whether registered in Canada or
not, is not, where any of the following events occur without his
actual fault or privity, namely,
(d) where any loss or damage is caused to any property,
other than property described in paragraph (b), or any rights
are infringed through
(i) the act or omission of any person, whether on board
that ship or not, in the navigation or management of the
ship, in the loading, carriage or discharge of its cargo or in
4 First Edition, 1916, at p. 165.
5 Seventh Edition, 1932.
6 (1875) cases decided in the Court of Session, No. 168, 4th
series, Volume 11.
7 Volume 11, Seventh Edition, 1976.
the embarkation, carriage or disembarkation of its passen
gers, or
(ii) any other act or omission of any person on board that
ship;
liable for damages beyond the following amounts, namely,
(3) The limits on the liability of an owner of a ship set by this
section apply in respect of each distinct occasion on which any
of the events mentioned in paragraphs (2)(a) to (d) occur
without that owner's actual fault or privity, and without regard
to any liability incurred by that owner in respect of that ship on
any other occasion.
648. (1) Where any liability is alleged to have been incurred
by the owner of a ship in respect of any loss of life or personal
injury, any loss of or damage to property or any infringement of
any right in respect of which his liability is limited by section
647 and several claims are made or apprehended in respect of
that liability, the Admiralty Court may, on the application of
that owner, determine the amount of his liability and distribute
that amount rateably among the several claimants; and such
court may stay any proceedings pending in any court in relation
to the same matter, and it may proceed in such manner and
subject to such regulations as to making persons interested
parties to the proceedings, and as to the exclusion of any
claimants who do not come in within a certain time, and as to
requiring security from the owner, and as to payment of any
costs, as the court thinks just.
Counsel for the defendant Canadian National
Railway Company contends that the admission of
liability must be without restriction and be abso
lutely binding for all purposes. He was, however,
unable to quote any authority for this proposition.
Section 648 states that where any liability is
alleged against the owner in cases where his liabili
ty is limited under section 647, the judge may
proceed to determine the amount of the liability
and to distribute it. The expression "is limited by
section 647" in the first sentence of section 648(1)
must be taken to mean "is alleged by the owner to
be limited" because the very issue which the judge
would normally be called upon to try would be
whether, according to the facts as established,
there existed in law any privity or fault of the
owner. If so, then, obviously there would be no
limitation and section 647 would not apply.
The lack of privity or fault and the resulting
limitation of liability and therefore, of necessity,
the very existence of liability must, according to
section 647(3), be related to the one distinct occa
sion on which the "events" occurred which are
mentioned in section 647(2) and which would give
rise to the limitation. An admission of liability in
an action for limitation must therefore be specifi
cally related to the occasion in question and to the
circumstances surrounding it. Since it is not an
admission made without prejudice and is not for
the purpose of settling any legal action, it is not in
any way privileged. I cannot see how it would
enjoy any particular protection by reason of the
fact that it is purported to be made "for the
purpose of this action only," as opposed to a bare
admission in any pleading.
The statement that the plaintiff considers itself
liable contains in essence mixed elements of law
and of fact. Law cannot as such be admitted: it
exists per se at all times until modified or revoked
by legislative authority. The admission of liability
of its nature embodies without specifying them, an
admission of all the facts required to create the
legal liability. All admissions of fact in a pleading
are considered formal admissions and cannot be
contradicted by the party making them. They are
as such to be distinguished from informal admis
sions which are merely considered as evidence.
However, it is important to remember that formal
admissions made in any pleading whatsoever,
although they cannot be contradicted in the action,
are only absolutely binding on the person making
them for the purpose of the particular action in
which they are made. (See Cross on Evidence,
Third Edition, page 137.) I therefore fail to see
how a statement that the admission is made for the
purposes of that action only, can add to or dero
gate from the essence of an unqualified formal
admission made in any pleading. As a necessary
corollary to the principle that an admission in a
pleading is only binding on the person making the
admission for the purpose of the particular action
in which it is made, is the principle that any
formal admission need be made only for the pur
pose of determining the issues before the Court
and for no other purpose. The admission in issue
before me is by that test obviously sufficient. That
admission of necessity would be absolutely binding
in this action on the plaintiff in so far as the
present defendants and claimants are concerned
and in so far as anyone else who might later on be
entitled to either defend or share in the fund.
The objection on the basis that the admission
was incomplete must for the above reasons fail.
Turning now to the second ground of objection
to the effect that this Court is not empowered by
section 648 to issue a restraining order, it is clear
that section 648 does not specifically mention such
power: it refers only to the power to stay proceed
ings. Statutory provisions conferring jurisdiction
must be strictly construed. As Audette J. stated in
Canadian National Railway Co. v. Lewis' at
pages 150-151:
Statutory provisions giving jurisdiction must be strictly con
strued and that is especially true when the statute confers
jurisdiction upon a tribunal, like the Exchequer Court, of
limited authority and statutory origin, and in such a case a
jurisdiction cannot be said to be implied. A court must not
usurp a jurisdiction with which it is not clearly legally vested;
but must keep within the limits of its statutory authority and
should not exercise powers beyond the scope of the Act giving it
jurisdiction and it cannot assume jurisdiction, unless clearly
conferred, in respect of matters of prior origin to the Act.
This principle would certainly apply to any
power which the Court would be attempting to
exercise over a person's right to sue in another
Court. The power to stay an action does not in any
way include the power to restrain a person from
instituting an action nor to order a person to
refrain from prosecuting any action: a staying
order is addressed to the procedural process of the
Court itself against which the order is given. It is
enforceable by the officers of the Court which is
subject to the order to stay, while a restraining
order is addressed to the litigants. However, every
Court of superior jurisdiction, if not every tribunal
of any kind, must possess the innate right of
controlling its own process and, subject to the
requirements of justice, to control the actions
before it of those wishing to avail themselves of its
jurisdiction. This Court would, therefore, have the
right to impose as a condition of any person being
allowed to prosecute an action in this forum a
restriction against that person prosecuting in
another forum an action for the same cause or
matter.
' 11930] Ex.C.R. 145.
In order to avoid the possibility of any difficulty
arising as to any of the many possible claims
regarding a prescriptive limitations of actions, it
would be much preferable to restrain prosecution
of existing or future actions rather than the insti
tution of any further actions. This would also be
more in keeping with the spirit of section 648
which provides for stays of pending actions rather
than forbidding the institution of new actions.
In view of the above, paragraph 5(b) of the
order of the 18th of January 1980, which I previ
ously quoted in full, will be deleted and replaced
by the following:
(b) The defendant Canadian National Railway
Company and all other persons wishing to main
tain in this Court any claim against the plaintiff
for loss or damages to property or any infringe
ment of any rights arising out of or resulting
from this event must do so in this present action
and, hereinafter, must refrain from prosecuting
beyond its mere institution any action in any
court against the plaintiff, its ship Japan Erica
and all persons who have liability that is limited
by virtue of sections 647 and 649(1) of the
Canada Shipping Act, in respect of this event
As to the third objection to the effect that the
Parliament of Canada does not have the constitu
tional capacity to restrain a litigant from exercis
ing its civil rights in a provincial court, there is no
need of my dealing with the submission as I have
now held that section 648 does not authorize this
Court to restrain a person from instituting an
action in a provincial court. The question as to
whether Parliament could authorize it therefore
does not in fact arise and is purely academic.
As previously stated, the fourth objection of the
applicants in this motion is based on the proposi
tion that the Parliament of Canada does not have
the, constitutional capacity to authorize the Feder
al Court to stay civil proceedings in a provincial
court.
There is no doubt whatsoever that an action
against the shipowners in the Province of British
Columbia, founded on either contract or tort, falls
within the realm of "Property and Civil Rights in
the Province" and, therefore, within head (13) of
section 92 of The British North America Act,
1867, 30 & 31 Vict., c. 3 (U.K.) [R.S.C. 1970,
Appendix II, No. 5] which are among the matters
as to which the provincial legislatures possess
exclusive authority to legislate. I hardly think that
any authority is required for this proposition.
Administration of justice, which includes proce
dure in civil matters in all provincial courts, is also
covered by section 92, (i.e. head (14)):
92... .
14. The Administration of Justice in the Province, including
the Constitution, Maintenance, and Organization of Provin
cial Courts, both of Civil and of Criminal Jurisdiction, and
including Procedure in Civil Matters in those Courts.
It is clear that a stay of proceedings is a proce
dural matter and that, therefore, authorization for
stays in provincial courts of proceedings in matters
reserved to the provinces lies also within the exclu
sive legislative authority of the provinces.
On the other hand, sections 647 and 648 of the
Canada Shipping Act deal squarely with acts,
omissions, liabilities and procedures directly relat
ed to the subject-matter of navigation and shipping
which in turn is under the exclusive jurisdiction of
the Parliament of Canada pursuant to head (10) of
section 91.
The constitutional problem which arises when a
matter which is reserved to the exclusive jurisdic
tion of the Parliament of Canada under section 91
is also a property and civil rights matter and, as
such, is under the exclusive jurisdiction of the
provinces under section 92 and is by no means a
novel one. For instance, it is rare indeed where a
matter, falling within the exclusive jurisdiction of
Parliament, does not in some manner affect prop
erty and civil rights in a province. It has been held
quite conclusively in several cases that the right of
Parliament to interfere with property and civil
rights exists where such interference is necessary
for the purposes of legislating generally and effec
tively in relation to matters confided to it by The
British North America Act, 1867. It has also been
held that the exclusive power of legislation given to
the provinces by head (14) of section 92 over
procedure in civil matters means procedure in civil
matters within the powers of the provincial
legislatures.
The Parliament of Canada also has the right to
confer on a court or courts of its choosing exclusive
jurisdiction over any matter which is reserved to
its own exclusive jurisdiction by the constitution. It
also by the same token is entitled to exercise the
right to deprive the provincial courts of jurisdiction
in this field. These principles were affirmed shortly
after Confederation, in 1879, by the Supreme
Court of Canada in Valin v. Langlois 9 . See espe
cially the following statements:
Per Ritchie C.J. at page 15:
... many matters involving property and civil rights are
expressly reserved to the Dominion Parliament, of which the
first two items in the enumeration of the classes of subjects to
which the exclusive legislation of the Parliament of Canada
extends are illustrations, viz.:-1. "The public debt and proper
ty;" 2. "The regulation of trade and commerce;" to say nothing
of "beacons, buoys, light houses, &c., "navigation and ship
ping," "bills of exchange and promissory notes," and many
others directly affecting property and civil rights; that neither
this, nor the right to organize Provincial Courts by the Provin
cial Legislatures was intended in any way to interfere with, or
give to such Provincial Legislatures, any right to restrict or
limit the powers in other parts of the Statute conferred on the
Dominion Parliament; that the right to direct the procedure in
civil matters in those courts had reference to the procedure in
matters over which the Provincial Legislature had power to give
those Courts jurisdiction, and did not, in any way, interfere
with, or restrict, the right and power of the Dominion Parlia
ment to direct the mode of procedure to be adopted in cases
over which it has jurisdiction, and where it was exclusively
authorized and empowered to deal with the subject matter; or
take from the existing courts the duty of administering the laws
of the land; and that the power of the Local Legislatures was to
be subject to the general and special legislative powers of the
Dominion Parliament.
Per Henry J. at page 67:
The right of the Local Legislatures to legislate as to civil
rights, as I have before stated, is subordinated to those civil
rights not affected by Dominion powers of legislation and to
those in the' Province, and not including matters of a general
character.
The 14th section gives local authority to deal with "adminis-
tration of justice in the Province," which I construe to mean the
power of legislating for the administration of justice in the
Province in regard to the subjects given by the Act, and, to that
extent only, to provide for "the constitution, maintenance and
organization of Provincial Courts," including the procedure
necessary for the administration of justice in reference to those
and kindred subjects.
9 (1879) 3 S.C.R. 1 (leave to appeal to Privy Council denied
(1879-80) 5 App. Cas. 115).
Per Taschereau J. at page 76:
And, if I pass to the civil laws, that is to say, other laws than
the criminal laws, I see in the B. N. A. Act many instances
where Parliament can alter the jurisdiction of the Provincial
Civil Courts. For instance, I am of opinion, that Parliament can
take away from the Provincial Courts all jurisdiction over
bankruptcy and insolvency, and give that jurisdiction to Bank
ruptcy Courts established by such Parliament; 1 also think it
clear, that Parliament can say, for instance, that all judicial
proceedings on promissory notes and bills of exchange shall be
taken before the Exchequer Court or before any other Federal
Court. This would be certainly interfering with the jurisdiction
of the Provincial Courts. But, I hold that it has the power to do
so quoad all matters within its authority.
The same principles have been reinstated on
many occasions since then. One need only to refer
to the later case of Attorney-General for Alberta
v. Atlas Lumber Co. Ltd. 10
Per Rinfret J. at pages 100 and 101:
But it has long since been decided that, with respect to
matters coming within the enumerated heads of sec. 91, the
Parliament of Canada may give jurisdiction to provincial courts
and regulate proceedings in such courts to the fullest extent.
That question was decided by this Court in Valin v. Langlois
((1879) 3 Can. S.C.R. 1, at pp. 15, 22, 26, 53, 67, 76, 77 &
89).
1 would like to quote the following passage from Lord Atkin,
delivering the judgment of the Privy Council in Proprietary
Articles Trade Association v. Attorney-General for Canada
([193!] A.C. 310, at 326-327):
If then the legislation in question is authorized under one
or other of the heads specifically enumerated in s. 91, it is
not to the purpose to say that it affects property and civil
rights in the Provinces. Most of the specific subjects in s. 91
do affect property and civil rights, but so far as the legisla
tion of Parliament in pith and substance is operating within
the enumerated powers, there is constitutional authority to
interfere with property and civil rights. The same principle
would apply to s. 92, head 14, "the administration of justice
in the Province", even if the legislation did, as in the present
case it does not, in any way interfere with the administration
of justice. Nor is there any ground for suggesting that the
Dominion may not employ its own executive officers for the
purpose of carrying out legislation which is within its consti
tutional authority, as it does regularly in the case of revenue
officials and other matters which need not be enumerated.
The Parliament of Canada chose to allow the
Exchequer Court, now the Federal Court, to share
10 [1941] S.C.R. 87.
jurisdiction with the provincial courts in the field
of navigation and shipping. It has the power, if it
so chooses, to grant exclusive jurisdiction in this
field to the Federal Court or to any other Court of
its choice or which it might wish to create. Since it
has the right to control civil procedures in provin
cial courts pertaining to navigation and, shipping
being a subject-matter within its exclusive power
to legislate, it must necessarily possess the capacity
to grant to the Federal Court a right to exercise,
on its behalf, control on that procedure by staying
proceedings in certain circumstances. Section 648
of the Canada Shipping Act, as enacted, is a clear
exercise of that power and the Federal Court is an
Admiralty Court as mentioned in the section (refer
Federal Court Act, R.S.C. 1970 (2nd Supp.), c.
10, section 22; see also Tropwood A.G. v. Sivaco
Wire & Nail Company"). The provision for stay
ing proceedings is obviously a necessary one to
avoid multiplicity of proceedings regarding the
same event. As to the requirement of having limi
tation of liability legislation for the protection of
shipowners in order to promote and protect naviga
tion and shipping in any area as well as interna
tional trade and commerce through any ports,
there can be no doubt. For over two centuries
civilized countries of the world have realized this
(see British Columbia Telephone Company v.
Marpole Towing Limited 12 and The
Abadesa" 13 ). For these reasons the applicants
must fail on this fourth ground of objection.
The final ground urged upon the Court was that
it should not, in the particular circumstances of
this case, stay the proceedings or issue any
restraining order against any parties. Several argu
ments were advanced in support of this. The appli
cants stated that, as neither the pilot, the owner's
agents, the tug owners nor the captain were parties
to this limitation action, discovery could not be
obtained against them, that Canadian National
Railway Company might want to prosecute its
claim in another court, that little prejudice would
be caused the owner by refusing to stay proceed
" [1979] 2 S.C.R. 157 at p. 160.
12 [1971] S.C.R. 321 at p. 338.
13 [1968] 1 Lloyd's Rep. 493 at p. 498.
ings and that the applicants wanted to get on with
the main action as quickly as possible.
These are fairly standard objections which one
would expect to be raised by any person opposing a
limitation action. The fear of losing the tactical
advantage of being able to sue several parties and
thereby to unearth evidence against the shipowner
is not, in my view, a very weighty motive for
refusing a stay. Furthermore, any delay on the
plaintiff's part in prosecuting the present action,
thus causing undue delay to the Canadian Nation
al Railway Company's main action, can be cured
or prevented by an application to the Court in the
normal way as provided for in Rules. The plaintiff
undertook before the Court to do all it reasonably
could to expedite the present limitation action. In
view of this, should it be guilty of any unjustifiable
delay, any of the defendants or claimants should
experience no difficulty in obtaining immediate
relief.
One cannot help but feel that the present case is
truly a classical one for which section 648 was
specifically designed. There was a great amount of
damage caused and there is the real possibility of
numerous claims. In the light of this, one has to
consider the costs and the possible confusion and
contradictory findings which might result from a
multiplicity of actions.
Should the limitation action succeed, this would
greatly reduce the amount of litigation not only for
the shipowner but for many of the claimants who
might save a great deal of time as well as legal
expenses and disbursements in attempting to
establish liability of the shipowner when liability is
in fact admitted in the limitation action with the
only real remaining issue being whether there was
any actual privity or fault on the part of the
shipowner. This is obviously an issue in which all
possible claimants have a common interest. Should
the liability prove to be limited, then, each claim
ant only has to establish the legal validity of its
claim and the actual amount.
To summarize, the circumstances weigh very
heavily in favour of a stay being granted. The ex
parte order will, therefore, subject to the amend
ments authorized by the present order, be con
firmed and, subject to any further order of this
Court, shall remain in full force and effect until
trial or other final disposition of this limitation
action.
In order to provide for any unforeseen circum
stances and to retain some flexibility in the proce
dure provided for in the ex parte order, it shall be
further amended by adding thereto the following
paragraph to be numbered 9:
9. Any provision of this order may be varied by
further order of this Court upon application by
any party following due notice to all other par
ties. "Party" in this paragraph shall include
persons who have chosen not to defend but who
have merely filed claims against the fund.
Costs in this application shall be against the
respondent, plaintiff in the cause.
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.