11.25: Real and substantial connection

Case Summary

Geophysical Service Inc. (“GSI”) commenced an Action against Jebco Seismic UK Ltd., Jebco Seismic LP, and Jebco/SEI Partnership Ltd. (the “Applicants”) and an Alberta-based entity claiming breach of copyright among other things. The Applicants were served pursuant to an Order for service ex-juris in September 2013.

The Applicants sought to set aside service, or alternatively, to dismiss or stay the Action on three grounds: (1) that there was not a “real and substantial connection” to Alberta; (2) that GSI had not demonstrated that a “reasonable cause of action” existed pursuant to Rule 11.25;and (3) that the commencement document was not “accompanied” by an Affidavit or other document setting out the grounds for extraterritorial service pursuant to Rule 11.25(2)(a).

On the first ground, Master Farrington held that GSI met the two-part test for a “real and substantial connection” set out by the Supreme Court of Canada in Van Breda v Village Resorts Ltd, 2012 SCC 17 (CanLII).Master Farrington held that a “real and substantial connection” existed in the present case because the Defendant was a necessary party to the Action brought against another person served in Alberta, as set out in Rule 11.25(3)(i), and that Alberta was the proper forum to hear GSI’s copyright arguments.

On the second ground, Master Farrington held that a “reasonable cause of action” and material issue did exist. Master Farrington noted that the former Rule 30 required that Applications for service Ex Juris be accompanied by an Affidavit swearing to the deponent’s belief that a “reasonable cause of action” existed. Although this requirement is not set out explicitly under the new Rule 11.25, Master Farrington held that an Affidavit which is satisfactory to the Court is still required under Rule 11.25(2)(b). Master Farrington further held that the hurdle of presenting a “reasonable cause of action” still remains under the new Rule, but observed that the Courts should not “delve too deeply into the merits of the dispute” at such an early stage.

On the third ground, Master Farrington noted that Rule 11.25(a) requires that service of commencement documents be “accompanied” by a document or Affidavit setting out the grounds for service outside of Canada. Master Farrington stated, however, that the Rule is not clear as to whether the word “accompanied” required the document be served on the opposing party, or merely filed. Since no party was “misled by the service”, Master Farrington held that GSI’s failure to serve the Affidavit under Rule 11.25(2)(a) amounted to a “curable irregularity”. As a result, service ex-juris was appropriate and the Order was upheld.

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