NOVA OCULUS CANADA MANUFACTURING ULC v SATHER

A British Columbia corporation commenced an Action in Alberta to unwind certain agreements for the transfer and use of key business and intellectual property assets and to obtain related common law and equitable relief, including for breach of fiduciary duty. The Defendants applied under Rule 3.68 to strike all or part of the amended Statement of Claim, arguing that the Alberta Court of King’s Bench lacked subject-matter jurisdiction as the relief sought fell within the exclusive jurisdiction of the British Columbia Supreme Court under British Columbia corporate legislation.

The Court set out the governing framework under Rule 3.68, emphasizing that a claim may be struck if the Court lacks jurisdiction. Adjudicative jurisdiction requires both territorial jurisdiction and subject-matter jurisdiction, and the existence of territorial jurisdiction cannot confer authority over matters outside the Court’s subject-matter competence. Subject-matter jurisdiction turns on whether the Court has legal authority to adjudicate the dispute and grant the relief sought.

To determine subject-matter jurisdiction, Marion J. applied the “essential character” test, which requires a realistic assessment of the true nature of the claim and the practical result sought, rather than a formalistic reading of the pleadings. While Courts must guard against artful pleading designed to circumvent exclusive statutory regimes, genuine strategic choices by a plaintiff must be respected. The inquiry focuses on the claim actually advanced, not an alternative statutory remedy the responding party says should have been pursued.

Applying this approach, Justice Marion rejected the Defendants’ characterization of the Action as a statutory claim that only a British Columbia Court could hear. The statutory provision relied upon by the Defendants created a specific remedy available to a corporation’s stakeholders, not to the corporation itself, and the Plaintiff did not seek relief under that provision. The Court found no basis to reframe the claim as a statutory application merely because a statutory remedy might have been available to other parties.

The Court further held that, absent clear legislative language to the contrary, provincial Superior Courts retain inherent subject-matter jurisdiction to grant common law and equitable remedies, including rescission, even where the dispute involves a corporation incorporated in another province. No express or necessarily implied legislative intent ousting that jurisdiction was established.

Marion J. also rejected the argument that claims for breach of fiduciary duty owed by directors of a British Columbia corporation fall within the exclusive jurisdiction of British Columbia Courts. Fiduciary duties arise both under statute and at common law and equity, and the applicable legislation expressly preserves non-statutory liabilities. The statutory regime did not constitute a complete code that displaced the jurisdiction of other provincial superior courts.

Finally, the Court confirmed that it had territorial jurisdiction, noting that the defendants had attorned by actively litigating in Alberta and had not raised territorial jurisdiction or forum conveniens. In the absence of any basis to decline jurisdiction, the Court held that it had adjudicative jurisdiction over the Action.

The Application was dismissed.