Hunt v. T&N plc

Hunt v. T&N plc
Collection
Supreme Court Judgments
Date
1993-11-18
Report
[1993] 4 SCR 289
Case number
22637
Judges
Lamer, Antonio; La Forest, Gérard V.; L'Heureux-Dubé, Claire; Sopinka, John; Gonthier, Charles Doherty; Cory, Peter deCarteret; McLachlin, Beverley
On appeal from
British Columbia
Subjects
Constitutional law
Courts
International law
Notes
SCC Case Information: 22637
Decision Content
Hunt v. T&N plc, [1993] 4 S.C.R. 289
George Ernest Hunt Appellant
v.
Lac d'Amiante du Québec Ltée, formerly known
as Lake Asbestos Company Limited, Asbestos
Corporation Limited, Atlas Turner Inc.,
Bell Asbestos Mines Limited, JM Asbestos Inc.,
the Quebec Asbestos Mining Association and
National Gypsum Co. Respondents
and
T&N, plc, Carey Canada Inc., formerly
known as Carey‑Canadian Mines Ltd.,
Flintkote Mines Limited and The Flintkote Co. Defendants
and
Workers' Compensation Board and
Henfrey Sampson Belair Ltd., Receiver‑Manager
for Victoria Machinery Depot Company Limited Third Parties
and
The Attorney General for Ontario and
the Attorney General of Quebec Interveners
Indexed as: Hunt v. T&N plc
File No.: 22637.
1992: October 7; 1993: November 18.
Present: Lamer C.J. and La Forest, L'Heureux‑Dubé, Sopinka, Gonthier, Cory and McLachlin JJ.
on appeal from the court of appeal for british columbia
Conflict of laws ‑‑ Civil procedure ‑‑ Discovery of documents ‑‑ Plaintiff in civil action in British Columbia seeking discovery of documents from Quebec defendants ‑‑ Quebec statute prohibiting removal from province of documents of business concerns ‑‑ Whether blocking statute provides "lawful excuse" for not complying with demand for discovery ‑‑ Business Concerns Records Act, R.S.Q., c. D‑12 ‑‑ British Columbia Rules of Court, rr. 2(5), 26.
Constitutional law ‑‑ Statutes ‑‑ Validity ‑‑ Quebec statute prohibiting removal from province of documents of business concerns ‑‑ Whether blocking statute ultra vires province as being in relation to matter outside province ‑‑ Whether blocking statute constitutionally inapplicable to judicial proceedings in another province ‑‑ Business Concerns Records Act, R.S.Q., c. D‑12.
Courts ‑‑ Jurisdiction ‑‑ Superior courts ‑‑ British Columbia courts declining to rule on constitutionality of Quebec statute ‑‑ Whether British Columbia courts had jurisdiction to deal with constitutional issue.
Courts ‑‑ Jurisdiction ‑‑ Supreme Court of Canada ‑‑ British Columbia courts declining to rule on constitutionality of Quebec statute ‑‑ Whether British Columbia courts had jurisdiction to deal with constitutional issue ‑‑ Whether Supreme Court of Canada restricted to powers and procedures of courts appealed from ‑‑ Supreme Court Act, R.S.C., 1985, c. S‑26, s. 45 .
The appellant suffers from cancer which he alleges was caused by the inhalation of asbestos fibres to which he was exposed while working as an electrician in British Columbia. These fibres were allegedly contained in products manufactured and sold by the respondents, which are Quebec companies involved in the production and distribution of asbestos. The appellant sued the respondents for damages in British Columbia. He requested production of documents relating to the action. The Quebec Business Concerns Records Act prohibits the removal from the province of documents relating to any business concern in Quebec pursuant to any requirement of a judicial authority outside the province. When the respondents did not respond, the appellant served demands for discovery of documents on them under Rule 26(1) of the British Columbia Rules of Court. In response to these demands, certain of the respondents asserted that the Act prevented compliance; the others made no reply. The Quebec Provincial Court granted orders preventing the respondent companies from sending documents out of the province. The appellant then applied to the British Columbia Supreme Court for an order compelling production of the documents. Rule 2(5) empowers the trial court to strike out a statement of defence for failure "without lawful excuse" to comply with the Rules. The application was dismissed, and the Court of Appeal upheld that judgment. Both courts acted on the basis that the Quebec Act was valid, ruling that the British Columbia courts did not have jurisdiction over the constitutional validity of a Quebec statute. This appeal is to determine whether the provisions of the Quebec Act provide a "lawful excuse" under Rule 2(5). The fundamental issue is whether this statute is ultra vires the province as being in relation to a matter outside the province, or constitutionally inapplicable to judicial proceedings in other provinces.
Held: The appeal should be allowed.
At common law the issue of what is foreign law is a question of fact to be determined by the trial judge, and the Quebec statute was clearly a material fact, and its constitutionality is therefore equally material. Courts may consider constitutional arguments in determining foreign law that incidentally arises in the course of litigation. A foreign court in making a finding of fact should not be bound to assume that the mere enactment of a statute necessarily means that it is constitutional. The fact that there is no mandatory provision for advising the appropriate Attorney General does not make the procedure invalid. The courts below were thus in error in believing that the rules of conflicts law prevented consideration of the constitutionality of the laws of another jurisdiction. That both jurisdictions in question are part of the same Canadian federation and governed by the same Constitution reinforces and possibly augments the powers of the superior courts to consider the constitutional issues.
The guiding element in the determination of an appropriate forum must be principles of order and fairness. In view of the essentially unitary nature of the Canadian court system, the process is basically fair, all the more so since it is subject to the supervisory jurisdiction of this Court. This is especially true where, as here, the issue relates to the constitutionality of the legislation of a province that has extraprovincial effects, and that constitutionality has never been and is unlikely to be challenged in the other province's courts. Because of the far‑reaching impact of such rulings, however, the courts should restrict themselves to hearing constitutional challenges to the legislation of other provinces only where there is a real interest affected in their province.
Since the courts of British Columbia had jurisdiction to deal with the constitutional issue, so has this Court. Moreover, this Court is not restricted to the identical powers and procedures of the lower courts from which an appeal is taken. It may take judicial notice of all laws prevailing in every province, even in cases where such laws have not been proved in evidence in the courts below, so long as they were pleaded at first instance.
The courts must consider appropriate policy in relation to recognition and enforcement of judgments issued in other provinces in light of the legal interdependence under the scheme of confederation established in 1867. The old common law rules relating to recognition and enforcement were rooted in an outmoded conception of the world that emphasized sovereignty and independence, often at the cost of unfairness. Greater comity is required in our modern era when international transactions involve a constant flow of products, wealth and people across the globe. Moreover, it is inherent in the structure of the Canadian federation that the courts in each province should give "full faith and credit" to the judgments of the courts of other provinces.
While a province is not debarred from enacting any legislation that may have some effect on litigation in other provinces, it must respect minimum standards of order and fairness. The statute at issue here does not meet those standards. The whole purpose of a blocking statute is not to keep documents in the province, but to impede successful litigation in other jurisdictions by refusing recognition and compliance with orders issued there. While this is no doubt part of sovereign right, it certainly runs counter to comity. This Court's decision in Morguard requires that the rules of private international law be adapted to the structure of the Canadian federation. Since courts are required, by constitutional restraints, to assume jurisdiction only where there are real and substantial connections to that place, the presence of such blocking statutes is an anachronism that is definitely inimical to interprovincial litigation if applied on the interprovincial level. Discovery is a very important tool of civil litigation, especially in cases of this type where there are allegations of some sort of product liability. The Quebec Business Concerns Records Act is therefore constitutionally inapplicable to other provinces and thus to this case. Given this finding, it is unnecessary to consider whether the Act is wholly unconstitutional because in pith and substance it relates to a matter outside the province. Nor is it necessary to consider whether the statute could properly be "read down" to permit its application to jurisdictions outside the country or to consider the public policy issue raised.
Cases Cited
Considered: Morguard Investments Ltd. v. De Savoye, [1990] 3 S.C.R. 1077; disapproved: 2632‑7602 Québec Inc. v. Pizza Pizza Canada Inc., [1991] R.J.Q. 2951; referred to: Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959; Hunt v. T&N, plc, B.C.S.C., Vancouver Reg. No. C885383, June 30, 1989; Québec (Procureur général) v. Lac d'Amiante du Québec Ltée (1989), 24 Q.A.C. 235, leave to appeal refused, [1989] 2 S.C.R. viii; Asbestos Corp. v. Eagle‑Picher Industries Inc., [1984] C.A. 151; Reference re Upper Churchill Water Rights Reversion Act, [1984] 1 S.C.R. 297; Renault v. Bell Asbestos Mines Ltd., [1980] C.A. 370, rev'g [1976] C.P. 284; Benesh, Friedlandler, Coplan & Aronoff v. Nesmith, [1983] C.S. 790; Attorney General of Canada v. Canard, [1976] 1 S.C.R. 170; Buck v. Attorney‑General, [1965] 1 All E.R. 882; Manuel v. Attorney General, [1982] 3 All E.R. 786; Douglas/Kwantlen Faculty Assn. v. Douglas College, [1990] 3 S.C.R. 570; Cuddy Chicks Ltd. v. Ontario (Labour Relations Board), [1991] 2 S.C.R. 5; Northern Telecom Canada Ltd. v. Communication Workers of Canada, [1983] 1 S.C.R. 733; Ontario (Attorney General) v. Pembina Exploration Canada Ltd., [1989] 1 S.C.R. 206; Attorney General of Canada v. Law Society of British Columbia, [1982] 2 S.C.R. 307; Valin v. Langlois (1879), 3 S.C.R. 1; R. v. Thomas Fuller Construction Co. (1958) Ltd., [1980] 1 S.C.R. 695; Thorson v. Attorney General of Canada, [1975] 1 S.C.R. 138; Moran v. Pyle National (Canada) Ltd., [1975] 1 S.C.R. 393; Bank of Montreal v. Metropolitan Investigation & Security (Canada) Ltd., [1975] 2 S.C.R. 546; John Morrow Screw and Nut Co. v. Hankin (1918), 58 S.C.R. 74; Logan v. Lee (1907), 39 S.C.R. 311; Pettkus v. Becker, [1980] 2 S.C.R. 834; Cooper v. Cooper (1888), 13 App. Cas. 88; R. v. Gardiner, [1982] 2 S.C.R. 368; Argentina v. Mellino, [1987] 1 S.C.R. 536; Attorney General for Ontario v. Scott, [1956] S.C.R. 137; Aetna Financial Services Ltd. v. Feigelman, [1985] 1 S.C.R. 2; Black v. Law Society of Alberta, [1989] 1 S.C.R. 591; Indyka v. Indyka, [1969] 1 A.C. 33; Boxer v. Reesor (1983), 43 B.C.L.R. 352; Cie Financière et Commerciale du Pacifique v. Peruvian Guano Co. (1882), 11 Q.B.D. 55.
Statutes and Regulations Cited
Business Concerns Records Act, R.S.Q., c. D‑12, ss. 1, 2, 3, 4 [am. 1988, c. 21, s. 66], 5 [idem].
Constitution Act, 1867, ss. 92(13) , (14) , (16) , 101 .
Constitution Act, 1982, s. 52(1) .
Evidence Act, R.S.B.C. 1979, c. 116.
Rules of Court [British Columbia], rr. 2(5), 26.
Special Procedure Act, R.S.Q., c. P‑27.
Supreme Court Act, R.S.C. 1970, c. S‑19, s. 41(1).
Supreme Court Act, R.S.C., 1985, c. S‑26, ss. 40(1) , 45 .
Authors Cited
Black, Vaughan. "The Other Side of Morguard: New Limits on Judicial Jurisdiction" (1993), 22 Can. Bus. L.J. 4.
Black, Vaughan, and John Swan. "New Rules for the Enforcement of Foreign Judgments: Morguard Investments Ltd. v. De Savoye" (1991), 12 Advocates' Q. 489.
Finkle, Peter, and Claude Labrecque. "Low‑Cost Legal Remedies and Market Efficiency: Looking Beyond Morguard" (1993), 22 Can. Bus. L.J. 58.
Groffier, Ethel. Précis de droit international privé québécois, 4e éd. Cowansville: Yvon Blais, 1990.
Hogg, Peter W. Constitutional Law of Canada, 3rd ed. Scarborough, Ont.: Carswell, 1992.
Strayer, Barry L. The Canadian Constitution and the Courts, 3rd ed. Toronto: Butterworths, 1988.
APPEAL from a judgment of the British Columbia Court of Appeal (1991), 56 B.C.L.R. (2d) 365, 81 D.L.R. (4th) 763, [1991] 5 W.W.R. 475, 48 C.P.C. (2d) 247, 3 B.C.A.C. 138, 7 W.A.C. 138, affirming a judgment of Esson C.J.S.C. (1990), 43 B.C.L.R. (2d) 390, 67 D.L.R. (4th) 687, [1990] 3 W.W.R. 558, dismissing an application for an order compelling the production of documents. Appeal allowed.
J. J. Camp, Q.C., David Church and Steven Antle, for the appellant.
W. S. Berardino, Q.C., Avon Mersey and Michael Sobkin, for the respondent Lac d'Amiante du Québec Ltée.
Jack Giles, Q.C., and Robert J. McDonell, for the respondents Asbestos Corporation Limited, Atlas Turner Inc. and Bell Asbestos Mines Limited.
Henry S. Brown, Q.C., and Richard B. Lindsay, for the respondent JM Asbestos Inc.
Louis J. Zivot, for the respondent the Quebec Asbestos Mining
Association.
John L. Finlay, for the respondent National Gypsum Co.
Michel Hélie, for the intervener the Attorney General for Ontario.
Alain Gingras, for the intervener the Attorney General of Quebec.
//La Forest J.//
The judgment of the Court was delivered by
La Forest J. -- Legal systems and rules are a reflection and expression of the fundamental values of a society, so to respect diversity of societies it is important to respect differences in legal systems. But if this is to work in our era where numerous transactions and interactions spill over the borders defining legal communities in our decentralized world legal order, there must also be a workable method of coordinating this diversity. Otherwise, the anarchic system's worst attributes emerge, and individual litigants will pay the inevitable price of unfairness. Developing such coordination in the face of diversity is a common function of both public and private international law. It is also one of the major objectives of the division of powers among federal and provincial governments in a federation. This appeal raises issues that lie at the confluence of private international law and constitutional law. In seeking to find a workable balance between diversity and uniformity, one must be aware of the similarities but also the differences that exist in the balances represented in the rules in these two areas of law.
The immediate issue in this appeal is whether the provisions of the Quebec Business Concerns Records Act, R.S.Q., c. D-12, a "blocking statute", provide a "lawful excuse" under Rule 2(5) of the British Columbia Rules of Court, such that Quebec defendants to a civil action in British Columbia can refuse to comply, as required by Rule 26 of the British Columbia Rules of Court, with a demand for discovery of documents. The Quebec statute prohibits inter alia the removal from the province of documents of business concerns in Quebec that are required pursuant to judicial processes outside the province. The fundamental issue is whether this statute is ultra vires or whether it is constitutionally inapplicable to a judicial proceeding in another province.
During various stages of the proceedings, the appellant has claimed that the Act does not provide an excuse from production of the documents sought in British Columbia for the following reasons: (1) the Act is ultra vires the National Assembly of Quebec, or, alternatively, it is constitutionally inapplicable to a judicial proceeding in another province; (2) the Act is contrary to the public policy of British Columbia; or (3) the Act is not mandatory and failure to comply with discovery constituted bad faith on the part of the respondents. In connection with the first issue, the Chief Justice on June 2, 1992 stated the following constitutional question:
Is s. 2 of the Quebec Business Concerns Records Act, R.S.Q., c. D-12, ultra vires the National Assembly of Quebec or constitutionally inapplicable because its pith and substance is a derogation from extraprovincial rights?
The respondents contest all these issues, and also contest the jurisdiction of this Court to hear the constitutional question. They claim that this Court can only exercise the powers the British Columbia courts could, and that the latter lacked jurisdiction to rule on the constitutionality of a Quebec statute.
Background
The appellant, George Hunt, suffers from cancer which he alleges was caused by the inhalation of asbestos fibres to which he was exposed while working as an electrician at the Victoria Machinery Depot in Victoria, British Columbia. These fibres, it is further alleged, were contained in products designed, manufactured, packaged, advertised, distributed, promoted and sold by a number of companies, including the respondents, which are Quebec companies involved in the production and distribution of asbestos.
The appellant and a number of other plaintiffs, supported by the Workers' Compensation Board of British Columbia, brought action against the respondents for damages, alleging negligent manufacture, negligent failure to warn against dangerous effects of the fibres, and conspiracy to hide the dangers of asbestos from the public. An earlier application to strike the appellant's statement of claim was dismissed by this Court in Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959. The respondents then challenged the jurisdiction of the British Columbia Supreme Court and sought a stay of proceedings; see Hunt v. T&N, plc, Vancouver Reg. No. C885383, June 30, 1989. The British Columbia Supreme Court dismissed the application, and leave to appeal that decision to the British Columbia Court of Appeal was denied (July 26, 1989).
The appellant then requested production of documents related to the action. The respondents did not respond to this request. On September 11, 1989, the appellant served a demand for discovery of documents under Rule 26(1) of the British Columbia Rules of Court on the respondents Atlas Turner Inc. ("Atlas"), Bell Asbestos Mines Limited ("Bell"), Asbestos Corporation Limited ("ACL") and the Quebec Asbestos Mining Association and National Gypsum Co. ("QAMA"). A demand for discovery had been served on Johns-Manville Amiante Canada Inc. on June 23, 1989. JM Asbestos Inc. ("JM") was later substituted for the latter defendant. In response to these demands, both JM and QAMA asserted that the Act prevented compliance with the demands; the other respondents made no reply. On October 2, 1989, the principal shareholders of the respondents Atlas, Bell and ACL petitioned the Quebec Provincial Court for an order, pursuant to s. 4 of the Act, preventing the companies from sending documents out of the province. Bell also petitioned for a similar order against QAMA. On November 17, 1989, the principal shareholder of JM made a similar petition. All these orders were granted. In 1980, the Attorney General of Quebec had applied for an order pursuant to the Act against the respondent Lac d'Amiante du Québec Ltée. ("Lac d'Amiante") with respect to another action. On April 26, 1989, Lac d'Amiante appealed that order to the Quebec Court of Appeal. The appeal was dismissed; see Québec (Procureur général) v. Lac d'Amiante du Québec Ltée (1989), 24 Q.A.C. 235. An application for leave to appeal to this Court was dismissed on November 23, 1989: [1989] 2 S.C.R. viii.
On October 3, 1989, the appellant served Atlas, Bell, ACL and QAMA with a notice of motion for an order compelling discovery of lists of documents. Notice was served on JM on October 10, 1989. Both applications were adjourned at the request of the respondents. On October 12, 1989, Atlas, Bell and ACL gave "lists of documents" listing no documents, claiming that the orders under the Quebec statute prevent disclosure. JM had done the same earlier. The appellant then applied to the Supreme Court of British Columbia for an order compelling the production of the documents. The chambers judge, Esson C.J.S.C., dismissed the application: (1990), 43 B.C.L.R. (2d) 390, 67 D.L.R. (4th) 687, [1990] 3 W.W.R. 558. The appellant unsuccessfully appealed to the Court of Appeal of British Columbia: (1991), 56 B.C.L.R. (2d) 365, 81 D.L.R. (4th) 763, [1991] 5 W.W.R. 475, 48 C.P.C. (2d) 247, 3 B.C.A.C. 138, 7 W.A.C. 138. Leave to appeal to this Court was granted on January 16, 1992: [1992] 1 S.C.R. viii.
Judicial History
Supreme Court of British Columbia (1990), 43 B.C.L.R. (2d) 390
After reviewing the history of the Act, Esson C.J.S.C. defined the basic issue as "whether considerations of comity require this court to respect the law of another province by accepting, as an excuse for not complying with the ordinary requirements of our rules, the prohibition in that law" (p. 394). He declined to rule on the constitutional validity of the Quebec statute, stating that he was not aware of any precedent where provincial legislation had been struck down by a court in another province. In any event, he would not entertain such a submission without hearing from the Attorney General or other appropriate representative of Quebec. He therefore proceeded on the assumption that the legislation was valid.
The Chief Justice observed that the orders under s. 4 of the Act had been obtained at the petition of shareholders in the companies, and not by the Attorney General. He observed that he could not "resist the inference that this was a case of deliberately courting legal impediments to production" (p. 396), but he felt that deliberate courting of legal impediment was of no significance if an effective legal impediment existed in any event. He referred to the reasons of Kaufman J.A. in Lac d'Amiante, supra, which found that s. 4 of the Act merely gives the prohibition in s. 2 "greater teeth". He stated that other Quebec authorities had also interpreted the Act broadly, referring to the Quebec Court of Appeal decision in Asbestos Corp. v. Eagle-Picher Industries Inc., [1984] C.A. 151, which indicated that the prohibition in the Act extended to any form of indirect disclosure as well, for example, even delivery of a list of documents. While the affidavit evidence of a Quebec attorney filed as evidence in the earlier application for a stay of proceedings expressed the opinion that the Act was of more limited application, Esson C.J.S.C. did not consider that he should interpret the Act differently from the cases he had examined. He, therefore, found that the prohibition in the Act is wide and extends to the making of lists of documents, and was not prepared to order that the companies break the Quebec law.
Based on his reading of the cases, the Chief Justice held that the doctrine of comity required the court not to compel the circumvention of the law of another jurisdiction. He noted that while significant, discovery was considerably less vital to civil actions than the ability to compel evidence at trial. Furthermore, he noted that the appellant's ultimate course would be an order striking out the defence for non-compliance with discovery under Rule 2(5). He indicated that this discretionary remedy would not be given where, as in this case, the non-compliance to provide discovery of documents was based on a legal prohibition.
British Columbia Court of Appeal (1991), 56 B.C.L.R. (2d) 365
Gibbs J.A., for a unanimous Court of Appeal, accepted the ruling of Esson C.J.S.C. that the British Columbia courts do not have jurisdiction over the constitutional validity of a Quebec statute, and that he could not be faulted for not entertaining the matter without hearing from the Attorney General of Quebec. Gibbs J.A. noted that in order to be heard on the appeal, the Attorney General would have to apply for intervener status and would have to accept the record below unless leave to introduce fresh evidence was granted, and held that it was not open to the appellant to impose such obligations on the Attorney General. The court did not, therefore, call on the Quebec respondents to reply to the constitutional submissions. Consequently, like Esson C.J.S.C., the court acted on the basis that the Quebec Act was valid.
This, Gibbs J.A. stated, led to conflict between the public policies of British Columbia as reflected in the Rules of Court and the Quebec statute. He noted that Esson C.J.S.C. had resolved that conflict by applying the doctrine of comity as between the provinces. That view, Gibbs J.A. thought, was supported by this Court's decision in Morguard Investments Ltd. v. De Savoye, [1990] 3 S.C.R. 1077. Gibbs J.A. ruled that the principles of comity developed in that case applied as much to the "recognition of, and deference to, validly enacted legislation of a province by the courts of another province" (p. 369).
Nevertheless Gibbs J.A. stated that the courts of one province might refuse to "give cognizance to an enactment of another province designed to intrude into the exclusive legislative field of the first province" (p. 369). Citing the decision of this Court in Reference re Upper Churchill Water Rights Reversion Act, [1984] 1 S.C.R. 297, he stated that a court must determine the pith and substance of the impugned statute. He reasoned that the Quebec statute had been enacted over 30 years ago, and that the incidental or consequential effect on the appellant now, in British Columbia, did not render the Act ultra vires.
On the other issues raised, the Court of Appeal agreed with the reasons and conclusions of Esson C.J.S.C. It agreed that the Act constituted an absolute prohibition, and that there was no bad faith by the Quebec companies in seeking orders preventing discovery.
The Act
For a full understanding of the issues, it is useful to examine the provisions of the Act in more detail. I, therefore, set forth its provisions at length:
1. In this act, the following words mean:
(a) "document": any account, balance sheet, statement of receipts and expenditure, profit and loss statement, statement of assets and liabilities, inventory, report and any other writing or material forming part of the records or archives of a business concern;
(b) "concern": any business concern in Québec;
(c) "requirement": any demand, direction, order, subpoena or summons.
2. Subject to section 3, no person shall, pursuant to or under any requirement issued by any legislative, judicial or administrative authority outside Québec, remove or cause to be removed, or send or cause to be sent, from any place in Québec to a place outside Québec, any document or résumé or digest of any document relating to any concern.
3. The prohibition enacted in section 2 shall not apply in the case of the removal or sending of a document out of Québec
(a) by an agency, branch, company or firm carrying on business in Québec, to a principal, head office, affiliated company or firm, agency or branch situated outside Québec, in the ordinary course of their business;
(b) by or on behalf of a company or person, as defined by the Securities Act, (chapter V-1) carrying on business in Québec, to a territory subject to another political jurisdiction in which the sale of the securities of such company or person has been authorized;
(c) by or on behalf of any such company or person carrying on business in Québec as a broker, security issuer or salesman within the meaning of the Securities Act, to a territory subject to another political jurisdiction in which any such company or person has been registered or is otherwise authorized to carry on business as broker, security issuer or salesman, as the case may be;
(d) whenever such removal or sending is authorized by any law of Québec or of the Parliament of Canada, in accordance with their respective jurisdictions.
4. Whenever there is reason to believe that a requirement has been or is likely to be made for the removal or sending out of Québec of a document relating to a concern, the Attorney General may apply to a judge of the Court of Québec, in the judicial district where the concern in question is located, for an order requiring any person, whether or not designated in the requirement, to furnish an undertaking or security to ensure that such person will not remove or send out of Québec the document mentioned in the said requirement.
The application to the judge of the Court of Québec shall be made by summary petition. In case of urgency, it may be filed and presented to the judge without prior service. The judge may however order the service thereof within such delay, in such manner and on such conditions as he may consider expedient.
Every person having an interest in a concern may exercise the rights contemplated in this section.
5. Every person who, having received notice of a petition to a judge of the Court of Québec under section 4, infringes the provisions of section 2, shall be guilty of contempt of court and liable to one year's imprisonment.
Every person who has furnished, or has received from the judge an order to furnish, an undertaking or security and who infringes the provisions of section 2 shall be guilty of contempt of court and liable to one year's imprisonment, without prejudice to any penalty or obligation provided by the undertaking or security furnished or ordered by the judge.
As can be seen, s. 2 (as construed pursuant to the definition in s. 1) provides a general prohibition, subject to exceptions in s. 3 not applicable here, against the removal from the province to any place outside the province of any business document relating to any business concern in Quebec, in pursuance of any requirement, i.e., demand, direction, order, subpoena or summons, of, inter alia, a judicial authority outside the province. Section 4 then provides that the Attorney General, or any person interested in the concern, may apply to a Quebec court in the judicial district where the concern is located for an order requiring a person to furnish an undertaking or security to ensure that a document mentioned in s. 2 shall not be removed out of Quebec pursuant to a judicial or other requirement. Finally, s. 5 provides that anyone who, having received a notice of an application under s. 4, or having furnished or been ordered to furnish an undertaking or security under s. 4, infringes s. 2, is guilty of contempt of court and is liable to one year's imprisonment.
The Act, like its counterpart in Ontario upon which it is patterned, was enacted, we were told, as a defence to the extraterritorial reach of United States anti-trust legislation and perhaps other forms of foreign judicial interference. In a colourful passage cited by Esson C.J.S.C. in the court below, the Quebec newspaper L'Événement of February 21, 1958, purports to report a speech by the then Premier of Quebec in introducing the Bill which makes it clear that its object was to prevent foreign, and specifically American, intrusions of that kind. The Quebec courts have on a number of occasions asserted that this was indeed the purpose of the legislation. Thus in Renault v. Bell Asbestos Mines Ltd., [1976] C.P. 284, the Quebec Provincial Court expressed the view that the main purpose of the Act is [translation] "to protect Canadian businesses or subsidiaries against the implementation of American or foreign anti-trust laws" (p. 287). That cannot be considered the last word on the issue, however. The Quebec Court of Appeal, [1980] C.A. 370, though it dealt with the case on the assumption that the Provincial Court's conclusion on the point was correct, indicated that this was not expressly stated in the Act and that there was no preamble (p. 372). However, in Benesh, Friedlandler, Coplan & Aronoff v. Nesmith, [1983] C.S. 790, at p. 793, it was again held that the objective of the Act "is generally conceded to be the protection of Québec businesses from foreign judicial interference such as anti-trust prosecutions . . .".
Despite this supposed narrow objective, the Quebec courts, as Esson C.J.S.C. noted, have nonetheless given the Act a generous interpretation consistent with its very broad terms. Thus in Lac d'Amiante, supra, Kaufman J.A. for the Court of Appeal held that it was not necessary in an order under s. 4 of the Act to set forth the relevant specific documents. Such a course, he stated, would be cumbersome and is unnecessary because s. 2 "in any case prohibits the removal of `any document . . .'" (p. 236). That case, of course, did not relate to antitrust matters. Again in Asbestos Corp. v. Eagle-Picher Industries Inc., supra, also a private civil action, the court interpreted the Act as including evidence taken before a rogatory commission in Quebec.
These cases also reject the notion that the Act is confined to documents demanded by foreign authorities and assert that it applies to demands made by judicial authorities in other provinces as well. This view was most recently applied in 2632-7602 Québec Inc. v. Pizza Pizza Canada Inc., [1991] R.J.Q. 2951.
There is one case, Benesh, supra, in which the Superior Court, per Gomery J., was willing to interpret the Act more narrowly. However, his restriction of the Act to cases involving "considerations of public policy" is far from clear, and the Act does not make it a matter of discretion. Again his notion that the term "documents" does not include letters to third parties would seem doubtful even if the Act were confined to antitrust cases, for that is a common means of proof in such cases. What is more, this approach conflicts with that taken by the Quebec Court of Appeal; see, for example, Renault, supra, at p. 371.
One commentator also argues that the Court of Appeal should have given a narrower interpretation to the Act on the basis of another Quebec statute, the Special Procedure Act, R.S.Q., c. P-27, and that there is no penalty specifically attached to violating the general prohibition in s. 2 of the Act; see E. Groffier, Précis de droit international privé québécois (4th ed. 1990), at p. 234. In the present case, however, there was a court order and in that event a sanction exists under s. 5 of the Act.
While an argument might be mounted against the position taken by the Quebec Court of Appeal, Esson C.J.S.C. and the British Columbia Court of Appeal can scarcely be faulted for accepting the Quebec Court of Appeal's position under the common law rule which holds that the law of another jurisdiction is a question of fact. Whether the British Columbia court could under the provision in the British Columbia Evidence Act, R.S.B.C., 1979, c. 116, permitting courts to take judicial notice of the laws of other jurisdictions permit a different approach to issues of foreign law was not argued and I, therefore, refrain from commenting on it. It would in any event be unusual for a British Columbia court to ignore the guidance of the Court of Appeal of Quebec respecting the interpretation of a Quebec statute.
This Court, as I will indicate, is not in the same position as the British Columbia court in dealing with the laws of another province. But in his argument in this Court, the appellant did not really attack the broad interpretation given to the Act. In fact, during oral argument, counsel for the appellant, the respondents and the intervener the Attorney General of Quebec all supported a broad interpretation. What the appellant really contested in this Court was that the Act was either ultra vires the Province of Quebec, as being in relation to a matter outside the province, or inapplicable as it applied to other provinces under the principles set forth by this Court in Morguard. Indeed the latter was the principal battleground during oral argument. Because of this, I propose to deal with the case on that basis. While, as I indicated, it may be possible to mount an argument for a narrower application of the Act, that argument was not fully made before this Court. Moreover, the Act is written in very broad terms and a full argument for reading it down might well require a consideration of constitutional requirements in any event.
May the British Columbia Court Consider the Constitutionality of the Quebec Statute?
Before considering the issue of constitutionality, it is necessary to examine a preliminary question raised by the respondents and the Attorney General of Quebec. They submit that this Court has no jurisdiction to consider the constitutionality of this Act. This, they say, flows from the operation of s. 45 of the Supreme Court Act, R.S.C., 1985, c. S-26 , which, they maintain, restricts this Court's jurisdiction to what the courts below could have done, citing a remark from Beetz J.'s reasons in Attorney General of Canada v. Canard, [1976] 1 S.C.R. 170, at p. 216. The courts below, they continue, properly accepted that they had no jurisdiction to rule on the constitutionality of the Quebec statute. Consequently, in their submission, this Court lacks jurisdiction to reply to the constitutional question framed by the Chief Justice.
I do not agree with this submission. In my view, the jurisdiction to at least consider the constitutionality of another province's legislation can be found in the right of any superior court to consider and make findings of fact respecting the law of another jurisdiction for the purposes of litigation before it. This jurisdiction to consider the laws of another province seems to me to be even more clearly justified when both jurisdictions are Canadian and governed by our Constitution. I will look at each of these questions in turn, and then address the specific jurisdiction of this Court in the interpretation of the laws of every province and their constitutionality.
Ordinary Power of Courts to Consider the Constitutionality of Foreign Law
I begin by noting that at common law the issue of what is foreign law, which most frequently but not exclusively arises in conflicts law, is a question of fact to be determined by the trial judge. In the present case, the law of Quebec is clearly a material fact for the consideration of whether there was a "lawful excuse" under Rule 2(5) of the British Columbia Rules of Court for failing to obey that province's rules for discovery. It is also a material fact in relation to the public policy of British Columbia. Since the Quebec statute is material to these issues, it follows that the validity of that statute, its constitutionality, is equally material.
In determining what constitutes foreign law, there seems little reason why a court cannot hear submissions and receive evidence as to the constitutional status of foreign legislation. There is nothing in the authorities cited by the respondents that goes against this proposition. Quite the contrary, Buck v. Attorney-General, [1965] 1 All E.R. 882 (C.A.), holds only that a court has no jurisdiction to make a declaration as to the validity of the constitution of a foreign state. That would violate the principles of public international law. But here nobody is trying to challenge the constitution itself. The issue of constitutionality arises incidentally in the course of litigation. The distinction is clearly made by Lord Diplock in Buck, at pp. 886-87:
The only subject-matter of this appeal is an issue as to the validity of a law of a foreign independent sovereign state, in fact, the basic law prescribing its constitution. The validity of this law does not come in question incidentally in proceedings in which the High Court has undoubted jurisdiction as, for instance, the validity of a foreign law might come in question incidentally in an action on a contract to be