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A couple of months ago I received a panicked call from a prospective client in the southern United States. His company had been served with a Complaint issued in Ontario and he had just realized that its Answer was due the next day. He was desperate to buy some time, and, in a surprising display of knowledge of Ontario's rules of court, he suggested filing "one of those notices that provides you with an extra ten days to file an Answer".
The notice that he was referring to is a Notice of Intent to Defend, which, when filed within the time limit for the filing of an Answer will extend the time for the delivery of an Answer by ten days. However, for foreign litigants, the filing of such a Notice must be given careful consideration as it may be deemed to constitute attornment to the jurisdiction of the Ontario courts. As such, you may lose the ability to challenge the Ontario court's jurisdiction simpliciter.
This can be a significant tactical error as the ability to force a plaintiff located in Ontario to commence proceedings in a foreign jurisdiction could effectively end the litigation, or at least make the plaintiff more amenable to a reduced settlement offer.
In many cases, such as the one in point here, you may not have even had the opportunity to engage local counsel. In that case, the best course of action is to write a letter to plaintiff's counsel indicating that you are considering bringing a motion to stay the action on the grounds of jurisdiction and asking that no default proceedings be commenced until such time as such a motion can be brought, or you decide to attorn to the jurisdiction of the Ontario courts.
Although there is nothing to prevent plaintiff's counsel from noting you in default, it is likely that the court will take a dim view of this behaviour given your letter and will not only set aside the default judgement, but grant you the costs of doing so (as Ontario has a loser pays system).
Therefore, before instructing local counsel to file a Notice of Intent to Defend to obtain those extra ten days, make sure that you are not giving up a powerful tactical weapon in exchange.
The foregoing provides only an overview. Readers are cautioned against making any decisions based on this material alone. Rather, a qualified lawyer should be consulted.
© Copyright 2006 McMillan Binch Mendelsohn LLP
