in Morguard Investments Ltd. v. De Savoye, [1990] 3 S.C.R. 1077, the Supreme Court of Canada placed a limit on the authority Canadian courts could assert over a foreign defendant. The Court held that Canadian courts can only assert jurisdiction over a foreign defendant when there is a "real and substantial connection" between the forum and the matter in dispute. As such, courts would have to balance the competing interests of the plaintiff's right to a convenient forum with the unfairness to the defendant in being forced to litigate in a foreign jurisdiction. .
Since Morguard, the term "real and substantial connection" has not been exactly defined, and the previous tradition of greatly favoring plaintiffs has remained in tact. Nevertheless, courts seem to have settled on a broad approach that considers the interests of both plaintiffs and defendants, including factors such as:
•The connection between the forum and the plaintiff's claim.
Canadian courts have an important interest in protecting the legal rights of their residents and therefore will afford injured plaintiffs generous access to domestic courts to recover their damages.
•The connection between the forum and the defendant.
If the defendant has engaged in any activity within the jurisdiction that bears upon the plaintiff's claim, Canadian courts will be more likely to assume jurisdiction over the defendant. However, it is important to note that courts in Canada have long held that, because damage is an essential element of any tort, if the damages complained of occurred in the forum, the tort is deemed to have been committed in the forum, regardless of whether the actual tortious conduct occurred somewhere else. See, e.g., Furlan v. Shell Oil Co., 2000 BCCA 404. As such, as long as damages were suffered in the Canadian jurisdiction, the court could hold the defendant engaged in conduct in that jurisdiction, even if the defendant had no other contacts with that jurisdiction.
•Unfairness to the defendant in assuming jurisdiction.
Courts take into account the nature of the activities engaged in by the defendant to determine whether there was a foreseeable risk of harm to parties in other jurisdictions, which would make haling the defendant into a foreign court less unfair.
•Unfairness to the plaintiff in not assuming jurisdiction.
Canadian courts have become much more protective of a domestic plaintiff's right to sue in a domestic forum. As such, convenience and fairness to the plaintiff are important factors in determining whether to assert jurisdiction over a foreign defendant.
•Whether there are multiple defendants to the suit.
When there are multiple defendants before the court, Canadian courts are more likely to assert jurisdiction over a foreign defendant if doing so would avoid requiring a domestic plaintiff to sue in more than one jurisdiction, which would involve the risk of inconsistent results. In this regards, as well, convenience to the plaintiff is an important consideration.
