Canada: Ontario Courts Cannot Validate Foreign Service Of Claims Where The Hague Convention Applies

The Ontario Court of Appeal recently confirmed that foreign states can hinder a plaintiff from serving a foreign defendant if that defendant resides in a country that is a member of the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters and the foreign state refuses to effect service. The Convention requires contracting states to designate a central authority to serve foreign proceedings and permits states to refuse to serve proceedings if they infringe on sovereignty or security. As an Ontario court will not grant final judgment against a defendant unless that defendant has been served, a foreign state can prevent the plaintiff from seeking the assistance of Ontario courts and require that plaintiff to start its action in the foreign court. 

In Khan Resources Inc. v. Atomredmetzoloto JSC, 2013 ONCA 189, the Ontario Court of Appeal held that an Ontario court cannot dispense with or validate foreign service when a contracting state refuses to facilitate service under the Convention. This decision, which underscores the risks involved when litigating international business disputes, confirms that rule 17.05(3) of the Rules of Civil Procedure – which incorporates the Convention into Ontario law – is a complete code for service on foreign defendants in contracting states. In short, plaintiffs must comply with the Convention

Factual Background 

Khan Resources Inc. (Khan) engaged in a joint venture to develop a uranium mining property in Mongolia with Atomredmetzoloto JSC (ARMZ). Khan is an Ontario corporation and ARMZ is a Russian corporation in which the Russian State Atomic Energy Corporation has a controlling interest. In August 2010, Khan commenced an action in Ontario against ARMZ seeking damages in the amount of $300 million. Khan alleges that the Russian government, acting through ARMZ, sought to deprive Khan of its interest in the uranium mining property in Mongolia. 

Russia Refuses to Serve Defendants 

As both Canada and Russia are contracting states, the Convention governed service of Khan's statement of claim on ARMZ in Russia. In December 2010, the Russian Ministry of Justice informed Khan that pursuant to article 13 of the Convention, it was refusing to serve Khan's statement of claim on the basis that effecting service would infringe its sovereignty or security.  

Asking Ontario Courts to Validate Service Regardless of the Convention 

After the Russian Ministry declined to serve ARMZ, Khan had the option of pursuing remedies under section 14 of the Convention, which provides that difficulties arising in connection with service abroad should be settled through diplomatic channels. Instead, Khan brought a motion in the Ontario Superior Court for an order substituting or dispensing with service under rule 16.04 or validating service under rule 16.08 of the Rules

In October 2011, Khan's motion was granted by a Master of the Superior Court, who held that Ontario courts retained the jurisdiction to substitute, dispense with or validate service regardless of the Convention. ARMZ appealed the Master's decision to a judge of the Superior Court. In March 2012, the Superior Court allowed the appeal and set aside the Master's order, concluding that the Convention applied to the exclusion of domestic law. 

Khan appealed the Superior Court's decision to the Ontario Court of Appeal, arguing that rule 17.05(3) (which incorporates the Convention into Ontario law) is only a prima facie means of service in a contracting state and that an Ontario court has the jurisdiction to validate foreign service regardless of the Convention. The Court of Appeal dismissed the appeal, outlining five reasons why rule 17.05(3), and through it the Convention, is a complete code for service on parties who reside in contracting states. 

Reasons Why Plaintiffs Must Comply with the Convention

The Court of Appeal explained why plaintiffs must comply with the Convention and rule 17.05(3) as follows: 

  1. The Convention's objectives: One of the Convention's main objectives is to improve the system of giving a defendant notice of a legal proceeding by establishing a uniform procedure for service in all contracting states. If Ontario courts were to circumvent the Convention and validate foreign service under rules 16.04 and 16.08, this would undermine one of the Convention's main purposes.
  2. The language found in the Rules: Rule 17.05(3)(a) contains the mandatory language that service in a contracting state shall be through the central authority. This mandatory language stands in contrast to rule 17.05(2), which is the rule regarding service in non-contracting states and which contains permissive language. Additionally, rule 17.05(2) incorporates the rule 16 provisions for dispensing with or validating service; rule 17.05(3) does not.
  3. Interpretation of the Rules in light of Canada's treaty obligations: Domestic law should be read so that it complies with Canada's international treaty obligations. The exception to this rule is where the government has expressly legislated contrary to treaty obligations. Ontario has not expressly legislated exceptions to Canada's Convention obligations; rule 17.05(3) fully enacts the Convention
  4. The Convention's exclusive character: The Practical Handbook on the Operation of the Hague Service Convention indicates that the Convention is of exclusive character and that if foreign service is required, the Convention provides an exhaustive list of ways to serve abroad. This notion has been affirmed by the Alberta Court of Appeal in Metcalfe v. Yamaha Motor Powered Products Co., 2012 ABCA 240, in which it was held that the Alberta Rules of Court "should not be interpreted so as to circumvent the methods of service provided in the Hague Convention." 
  5. Ontario jurisprudence: There is previous Ontario jurisprudence to the effect that plaintiffs cannot circumvent the Convention. If the Convention applies, plaintiffs must comply with it.

Exhausting All Possible Remedies Under the Convention

The Court of Appeal mentions that its analysis may have been different had Khan pursued all possible remedies under the Convention and was still unable to effect service. For example, in Zhang v. Jiang (2006), 82 OR (3d) 306, a Master for the Superior Court dispensed with service under rule 16.04 after finding that all reasonable steps to serve the defendants had been exhausted and that the interests of justice favoured an exception to service under the Convention.  

However, the Court of Appeal notes that, even if Khan had exhausted all means of serving ARMZ, Zhang would likely not have applied, especially as Khan had provided no compelling evidence to show that the interests of justice favoured dispensing with or validating service.


This decision highlights the risks involved when litigating international business disputes, especially when one of the involved parties is affiliated with a foreign government. While contracting states can refuse to facilitate service in only limited and specific circumstances, it is a risk that should be considered when choosing where to start cross-border litigation. On a more fundamental pre-contractual level, the decision mandates consideration of attornment clauses with agreed Canadian agents for service or arbitration clauses with agreed methods of non-Convention service of initiating documents – either of which could potentially avoid the outcome in Khan for a Canadian plaintiff asserting contractual rights against a foreign defendant.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions