Ontario Civil

Conflict of Laws


Forum selection clause in escrow agreement was enforced

Real estate transaction contemplated plaintiff purchasing and then leasing back number of properties in Andorra to defendant CA. Agreement of purchase and sale required defendants to enter into escrow agreement and make deposit to be held in escrow. Agreement did not contain either choice of law or forum selection provision. Escrow agreement was executed and deposit was made by defendants. Sale did not close. Plaintiff brought action for damages for breach of contract in amount of deposit in escrow account. Defendants brought motion to stay action on basis that Ontario lacks jurisdiction simpliciter, or on basis that Ontario was not convenient forum. Motion dismissed. Essential nature of claim was entitlement to funds under escrow agreement. Escrow agreement gave Ontario jurisdiction simpliciter, and also contractually named Ontario as convenient forum for disputes. There was no evidence that enforcing forum selection clause in escrow agreement in favour of Ontario would frustrate some clear public policy. Defendants failed to meet burden to show Andorra would clearly be more convenient forum. Action was to proceed in Ontario.

Terracap Investments Inc. v. Credit Capital Immobilliari, S.A. (July 14, 2016, Ont. S.C.J. [Commercial List], Mesbur J., CV-15-11016-00CL) 268 A.C.W.S. (3d) 544.

Law Times Poll

A group of benchers opposed to the Statement of Principles will need to win the support of their colleagues to repeal the requirement. Do you think they will be successful in repealing the statement of principles in the coming year?