Canada: Anvil Mining Ltd. v. Association Canadienne Contre l'Impunité

Last Updated: April 30 2012
Article by René Cadieux and Anne Drost

On January 24, 2012, the Québec Court of Appeal rejected an appeal on a motion made by the Association Canadienne Contre l'Impunité/Canadian Association Against Impunity (CAAI) to request the authorization to institute a class action proceeding against Anvil Mining Limited (Anvil) regarding its alleged complicity in the commission of war crimes and crimes against humanity in the Democratic Republic of the Congo (DRC).

The CAAI was set up under the joint initiative of five NGO's for the purposes of instituting class actions with respect to events that occurred in the DRC, more particularly in 2004. Anvil is a Canadian mining company that was incorporated in the North-West Territories in 2004, and its head office is located in Perth, Australia. Its principal, if not sole activity, is the exploitation of a copper and silver mine located in the DRC copper belt close to the border with Zambia. Since 2005, Anvil leases office space in Montréal, Québec where two employees, the V.-P. corporate affairs and a secretarial assistant, undertake work for the company. Although listed on the TSX, the only reason why Anvil opened an office in Montréal is because the V.-P. preferred to live there, rather than in Toronto.

The class group of people sought to be represented by the CAAI encompassed all those who had suffered the loss of a family member, injuries, damages to property or who had to flee the City of Kilwa located in the DRC, resulting from a raid conducted in October 2004 by the Armed Forces of DRC in order to suppress an armed rebellion. It is alleged that Anvil was complicit in assisting the DRC Armed Forces in the conduct of such actions.

The issue raised before the Québec courts was whether or not these courts actually had jurisdiction to hear the CAAI's claim in the first place, since the actions complained of took place within the territory of the DRC State.

In contrast with the other provinces and territories of Canada, the law of the Province of Québec is based on civil law. In the case at hand, the matter turned on the interpretation and application of the particular wording of three important articles of the Civil Code of Québec (CCQ), where the principles of private international law concerning the attribution of jurisdiction to domestic courts are codified. Although the matter under review is based on civil law, the exercise of discretion vested in the Québec courts to assert or deny jurisdiction in a case such as this one involves, as will emerge from the following review, the articulation of underlying policy considerations that can have wide-ranging implications.

In the case at hand, three competing principles were in play. Under Title Three – International Jurisdiction of Québec Authorities – Article 3148(2) of the CCQ provides that, when a legal person (corporation) has an establishment (place of business) in the Province of Quebec, the Québec courts have jurisdiction to hear claims against it if the dispute relates to its activities in Québec. Article 3135 CCQ, on the other hand, provides that even if a Québec court has original jurisdiction, it may nevertheless decline such jurisdiction in favour of a more competent forum (this is known as the principle of forum non conveniens). Conversely, under Article 3136, even when a Québec authority has no original jurisdiction in the first place, it may otherwise assume jurisdiction and hear a dispute if the dispute has "sufficient connections" with the Province of Québec and where proceedings could not possibly be instituted outside of Québec (this is known as the principle of forum of necessity).

At the beginning of the proceedings, Anvil filed a motion to have the case dismissed before being heard on the merits on the basis that the Québec courts lacked jurisdiction over the subject matter of the proceedings. It was assumed for the purposes of the proceedings that the alleged military actions by the DRC Armed Forces had actually taken place and that Anvil had indeed provided them with logistical support (air transportation to the conflict site, and vehicles and food once on the ground). The Superior Court of Québec (being the highest trial level court of first instance in the Province) rejected Anvil's motion and Anvil then appealed to the Québec Court of Appeal.

Anvil submitted to the Superior Court that its establishment in Montréal only opened in 2005 and that it could not, therefore, be held responsible for activities in Québec as regards events that had occurred in the DRC in 2004. Moreover, the activities of its establishment in Montréal had no relation to the decisions that had been made with respect to the 2004 events. Anvil then moved on to present a subsidiary argument, being the application of the principle of forum non conveniens, i.e., that the courts of the DRC were in a better position to hear the claim since the alleged actions occurred in the DRC or, alternatively, the Australian courts should hear the claim, since the company's head office is located there.

The CAAI argued that Article 3148(2) CCQ only requires that one establish that the corporation exercises activities in Québec that are linked to the claim set out in the litigation. In this case, it is alleged that the place of business in Québec was directly involved in the "crisis management" of the investors and of the corporate image following the 2004 events. With respect to forum non conveniens, it was submitted that Anvil had not demonstrated that either the DRC or the Australian courts were better forums than the Québec courts. Moreover, the CAAI submitted that the Québec courts were the proper forum, given Anvil's own assertion that the proceedings that were already conducted in the DRC are now completed, and in view of the United Nation's High Commissioner for Human Rights' harsh denunciation of the legal process of the DRC Military Court, which resulted in only two military personnel being found guilty of murder (and not of any war crimes). All the other military personnel that had been implicated were acquitted and the victims received no compensation. Also, an attempt to institute a class action in Australia had failed due to the fact that the government of the DRC obstructed the NGO's in their efforts to contact the victims. The Australian law firm which had initially accepted to take the case on behalf of the victims eventually withdrew from the proceedings and, when no other legal representation could be found, the claim was withdrawn.

The trial court ruled that Anvil's Montréal activities, even if these essentially only involved dealing with investor relations, were nevertheless related to the action being brought before the court, because such activities were necessarily linked to Anvil's single operation, being its mine in the DRC. The trial judge also dismissed the forum non conveniens argument, finding that it was impossible for the parties to be heard outside of Québec.

On appeal, the Court of Appeal decided that in order for the Québec courts to have original jurisdiction under Article 3148(2), it is sufficient that the defendant has an establishment (place of business) in Québec and that the activity that is the subject matter of the litigation takes place in Québec.

In the instant case, Anvil had neither any establishment nor any activity conducted in Québec in 2004. Moreover, the actions of Anvil's representatives in Montréal in 2005 had nothing to do with any alleged "complicity" that occurred in 2004. Even if it is not necessary to establish that the "decision" regarding participation in the events of 2004 must necessarily have been taken in Montréal, one must demonstrate that the subject matter of the litigation relates to activities in Québec. As such, the Court of Appeal found that there was no "real and substantial link" with the Province of Québec.

The Québec Court Appeal also dismissed the subsidiary forum of necessity argument (that was designed to seek to extend jurisdiction if none had been found in the first place), stating that the CAAI had not demonstrated the impossibility for the plaintiffs to have their case heard in a forum other than that of the Québec courts. The Court indicated that such argument could apply when issues arise in States in which citizens do not have adequate access to justice. In this case, however, it was not established that the victims had exhausted all of their local remedies in the DRC. Moreover, Anvil's head office is located in Australia. Australia does not fall into the category of States where access to justice is problematic. As for the proceedings in Australia, against the background of a "forum shopping" submission, the Court considered that it was not sufficient to merely allege that no representation could be obtained before the courts of Australia (perhaps impliedly in view of the fact that representation was in fact secured before the Québec courts, which are renowned as "class action friendly").

The CAAI has filed an application for leave to appeal before the Supreme Court of Canada.

The case is of significance because it highlights the extent – and the limits – to which Courts are willing to recognize or extend their jurisdiction over companies located within their territory as regards the extraterritorial conduct of such corporations, and, particularly, when such corporations are alleged to be accomplices in the commission of war crimes and crimes against humanity.

If the host State is unable to give redress, will the courts where the corporation has establishments and activities step in to fill in the gap? For the time being, on the facts of the matter placed before it, the Québec Court of Appeal answered, "No".

The issue is, however, timely. In a recent public speech given by a newly-retired and admired judge of the Supreme Court of Canada, his Lordship wondered whether courts (and Canadian courts in particular) are rising to the challenge posed by human rights' abuses in the Third World that are committed with the complicity of corporations. If the complicity is shown, what is their responsibility and who gets to decide? The matter being brought before the Supreme Court in this case has all the ingredients to address this question squarely and may have serious implications in all other non-civil law Canadian jurisdictions, as it relates to the exercise of judicial discretion in matters of attribution of jurisdiction.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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