Many employers and dismissed employees incorrectly assume that
the law stipulated in a contract determines where legal proceedings
can be commenced. The decision in Christmas v. Fort McKay,
2014 ONSC 373 (CanLII) confirms that simply selecting which legal
regime governs does not end the matter. Instead, jurisdiction needs
to be reviewed based on conflict of laws principles as opposed to
blind adherence to contract wording.
Background – Contract Refers to Ontario
Prior to his employment with the Fort McKay First Nation, Bernd
Christmas ran his own successful Canadian legal practice in
Toronto, Ontario. In January 2012, he accepted an offer of
employment to work for Fort McKay for a position based in Alberta.
The employment agreement which Christmas accepted was signed back
and sent by him to the employer via e-mail from Ontario to Alberta.
The agreement stated that it was governed by the laws of the
province of Ontario.
Termination and Ontario Lawsuit
In May 2012, Christmas was terminated and the employer claimed
that there was cause. He proceeded to move back to Ontario to
restart his legal practice. A lawsuit claiming wrongful dismissal
was then commenced in the Ontario courts.
Employer Obtains Dismissal Order – Alberta More
Fort McKay then filed a motion to either stay or dismiss the
Ontario claim based on their argument that the Ontario Superior
Court did not have jurisdiction. This position, which is referred
to as the forum non conveniens argument, is based on
Ontario having no real and substantial connection to the cause of
Christmas argued that the Ontario courts had jurisdiction
because the employment agreement had been made in Ontario when he
signed back the offer. This argument was rejected, with the Court
holding that an employment contract is actually considered to be
made in the jurisdiction where acceptance is received. In this
case, that meant that the contract was made in Alberta when Fort
McKay received the signed offer by email.
A further argument raised by Christmas was that the Ontario
Court had jurisdiction simpliciter (ie. in any event)
based on the Choice of Law provision in the contract. The Court
also dismissed this argument, noting that established law refers to
other factors based on the defendant's connection to the
jurisdiction. In this case, the employer conducted business in
Alberta, any allegedly improper acts (ie. the dismissal) occurred
in Alberta, and the contract had been made in that province. In
these circumstances, imposing Ontario court jurisdiction on Fort
McKay solely as a result of agreement to choice of law would, said
the Court, unfairly broaden the scope of its contractual
Takeaways for Employers
This decision highlights the importance of carefully reviewing
jurisdiction issues before defending a case on its merits. In many
cases, a business will agree to a particular choice of law in a
contract based on a variety of reasons, including what is requested
or the desire for uniformity. That choice is not, however,
necessarily conclusive about where proceedings may be commenced,
and which courts or tribunals ultimately have jurisdiction.
The foregoing provides only an overview and does not
constitute legal advice. Readers are cautioned against making any
decisions based on this material alone. Rather, specific legal
advice should be obtained.
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