In this case, the Ontario Superior Court (ONSC) applied the real and substantial connection test developed by the Supreme Court of Canada in Van Breda (see above) to an application concerning a dispute over the termination of a mining services agreement.
The services agreement was between Avanti Management and Consulting Limited (Avanti) and Argex Mining Inc. (Argex) and was in respect of services to be provided to Argex by Mr. Michael Dehn, in the capacity of Head of Technology and Business Development. Argex owned three mineral properties in Québec containing titanium ore. In order to extract and purify titanium oxide from the titanium ore, Argex uses a process over which the Ontario company Canadian Titanium Ltd. (CTL) owns the patent. The services agreement contemplated Mr. Dehn's involvement in the development and commercialization of the extraction process. Argex terminated the services agreement when it learned that Mr. Dehn was to become the president of a rival mining company. Avanti and Mr. Dehn subsequently brought suit against Argex before the ONSC, and Argex moved to stay the action on the grounds that the Ontario court lacked jurisdiction and that Ontario was not the most convenient forum.
In applying the new real and substantial connection test from Van Breda, the ONSC found that it had presumptive jurisdiction because a presumptiveconnecting factor had been identified: Argex carries on business in Ontario.The ONSC reached this conclusion notwithstanding the fact that Argexwas domiciled in Québec and that its resource properties were all locatedin Québec. Salient facts for the ONSC were that Argex had become a majorityowner in CTL (the Ontario company that owned the patented extractionprocess), Argex had been involved in efforts to develop and market thattechnology and Argex was listed on the TSX Venture Exchange, primarilyregulated by the Ontario Securities Commission. Although it was opento Argex to rebut the presumption of jurisdiction, it failed to do so.
In considering whether the action should be stayed on the basis of the forum non conveniens doctrine, the ONSC considered a number of factors, including where the services agreement was signed (Québec), the law applicable to the services agreement (Québec law), the location of key witnesses (Ontario and Québec), the location where evidence would come from (Ontario and Québec), the jurisdiction where the factual matters arose (Ontario and Québec), the place of business of the parties (Ontario and Québec) and the loss of a juridical advantage, which the ONSC considered a neutral factor. Although two of the considered factors favoured Québec, the ONSC found that Argex had not satisfied its burden to displace the Avanti's choice of Ontario as the appropriate forum.
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