Ref: Vale Canada Limited v. Royal & Sun Alliance Insurance Company of Canada, 2022 ONCA 862, appeal of 2022 ONSC 12.

Vale Canada, an international mining company, faced environmental degradation claims in several jurisdictions, most of which were denied coverage. Vale, along with their primary general liability insurers Royal & Sun Alliance, defended these various claims and sought indemnity from Vale’s various insurers.

One of those insurers, Travelers Casualty & Surety Co., brought a claim in the Supreme Court of the State of New York to resolve the coverage dispute.

Vale promptly sued Travelers and their other insurers for coverage and defence costs in the Ontario Superior Court of Justice, including: Travelers Casualty & Surety; Omega General Insurance Company; United States Fire Insurance Company; The North River Insurance Company; Employers Insurance Company of Wausau, Allstate Northbrook Indemnity Company; General Reinsurance Corporation; and Zurich Insurance Company Limited.

Vale accused Travelers of “forum shopping” in bringing a pre-emptive claim in New York.

Some of the defendant insurers took the position that the Courts of Ontario did not have jurisdiction or, if they did, were not the appropriate forum for determining the coverage claims.

The motions judge held (on 4 January 2022) that the Ontario courts had jurisdiction and were not forum non conveniens, allowing the Ontario action to proceed. However, on 10 May 2022 the New York court dismissed a motion by Vale and RSA seeking to have the New York action dismissed. Vale and RSA appealed the decision of the New York judge, and defendant insurers appealed the decision of the Ontario judge.

The decision therefore addresses the key issues of comity, jurisdiction simplicitur, and forum non conveniens.


The Court noted the comity between Canada and the United States, and that the principle of comity is “at the root” of the doctrines of jurisdiction and forum (Spar Aerospace v American Mobile at 15, 21.

Comity is not simply good will, but a mutual recognition of the executive or judicial acts of one nation in another nation. It is also not automatic but based on reciprocity and subject to revocation: “comity does not entail that a Canadian court will always defer to a foreign court’s decision to take jurisdiction” (at para.29). The Court noted briefly two relevant cases illustrating the extent and limits of comity.

In Kaynes v. BP, plc, 2014 ONCA 580, the defendant oil company faced class action claims resulting from environmental degradation in Canada and in the United States. The Ontario Court initially deferred to the American action, but when the American action was defeated on procedural grounds, the Ontario Court allowed the case to be reinstated in Canada so it could be heard (2016 ONCA 601). That is, the Courts of Ontario were prepared to defer to the American courts to hear the matter, but having declined to hear the matter, the Ontario action was able to proceed.

In Teck Cominco Metals Ltd. v. Lloyd’s Underwriters, 2009 SCC 11 we have facts very similar to the present case, in which claims for environmental degradation suffered in the US but resulting from Teck’s Canadian operations were brought in both British Colombia and in the United States. The America courts took jurisdiction, but the BC Courts and ultimately the Supreme Court of Canada found that this was not determinative of a Canadian court’s decision, and did in fact take jurisdiction.

That dispute was settled before competing trials over the same issues could take place, and so the conflict between the determinations of two different courts to take jurisdiction of the same subject matter was not finally determined.

Jurisdiction Simplicitur

In respect of almost all defendant insurers, the Court found that it had jurisdiction simplicitur in respect of the matters and defendants as they had places of doing business in Ontario and had all issued policies of coverage for risks including risks in Ontario:

[6]         Our ultimate holding can be stated briefly. A comprehensive general liability insurer, underwriting primary or excess insurance coverage for Ontario risks, connects itself to Ontario for jurisdictional purposes and thus commits itself to defending, in Ontario, claims arising out of those risks. No other outcome is commercially reasonable in the operation of the international insurance market and consistent with the principles of comity. There is no place that enjoys universal jurisdiction.

[7]         The common law principles of comity underpin the doctrines of jurisdiction simpliciter and forum non conveniens and stand against forum shopping and the notion that the race should go to the swiftest, for good reason, as we will explain. These principles ensure that Vale, an Ontario-based international miner, can sue its primary, comprehensive general liability insurer RSA, an Ontario-based insurer, in respect of environmental liabilities largely incurred by Vale for polluting Ontario properties, in Ontario’s Superior Court of Justice. These principles also entail the conclusion that Vale and RSA can sue the insurers who provided additional or excess insurance, largely follow-form, for the same type of risks, significantly but not exclusively tied to Ontario, in the same court.

In this respect it should be noted that, while Vale’s operations are global, in fact the preponderance of the 26 subject claims were centered in Ontario (19 sites) or Canada (3 additional sites). Additional, foreign claim included Japan, Indonesia, Wales, and New Jersey, USA.

The governing test for jurisdiction similicitur is the “real and substantial connection” test set out in Club Resorts Ltd. v. Van Breda, 2012 SCC 17, based on four presumptive (but not exclusive) connecting factors:

1)   The defendant is domiciled or resident in the province;

2)   The defendant carries on business in the province;

3)   The tort was committed in the province; and

4)   A contract connected with the dispute was made in the province.

While most of the insurance contracts were not made in Ontario, almost all insurer defendants ‘carried on business’ in Ontario through, e.g., representative offices, and the liabilities they would be called upon to insure could and did arise in Ontario. The Court held that these were presumptive connecting factors, and rejected the insurer’s arguments that the place of the contract should be determinative. This finding is reinforced by the Rules, which permit service outside of Ontario where the contract or the breach took place in Ontario.

Further, the provision of insurance is a regulated industry in Canada, and the Court agreed with the motions judge that registration and licensing for the provision of insurance to Canadians constitutes “doing business in Canada”.

The motions judge had accepted the submissions of one insurer, North River, that it was not registered and licensed in Canada as displacing the presumption that they were doing business in Canada. The Court of appeal disagreed, holding that by their nature insurance policies create long term relationships between insurer and insured with the potential for long-tail liabilities that could arise anywhere in the world but which operations are overwhelmingly in Ontario. Accordingly,

[113] …regardless of where they were negotiated or delivered, all of the insurers knew that the policies would be received and acted on in Ontario, that “all of the insurers participated in a global insurance program for an Ontario-based company with its mining assets largely held in Ontario”, that the policies related to “Ontario liabilities”, and that the subject matter of the claim involved the insurers being “sued on those policies in relation to those very liabilities” were findings that properly supported the existence of jurisdiction on the basis of carrying on business in Ontario

Forum Non Conveniens

The test for FNC was set out by Sopinka J. in Amchem Products Inc. v. British Columbia (Workers’ Compensation Board), [1993] 1 S.C.R. 897 and described by the Court at para.148:

…the court must determine whether there is another forum that is clearly more appropriate” (emphasis added). The implication is that “where there is no one forum that is the most appropriate, the domestic forum wins out by default … provided it is an appropriate forum.”

The burden of proof that there is a clearly more convenient forum lies on the party advancing the forum non conveniens position: Breeden v. Black, 2012 SCC 19, and a non-exhaustive list of factors  to consider was set out in Van Breda:

  1. a) the comparative convenience and expense for the parties to the proceeding and for their witnesses, in litigating in the court or in any alternative forum;
  2. b) the law to be applied to issues in the proceeding;
  3. c) the desirability of avoiding multiplicity of legal proceedings;
  4. d) the desirability of avoiding conflicting decisions in different courts;
  5. e) the enforcement of an eventual judgment; and
  6. f) the fair and efficient working of the Canadian legal system as a whole.

Breeden v Black added to this list “fairness to the parties”.

Applying these principles, the Court agreed with the motions judge that Ontario was the most appropriate forum for the dispute:

[91] …Vale Canada’s action too is tightly tied to this court. The underlying liabilities arose here in litigation and regulatory actions here. The evidence supporting the claims is here. This court is the natural forum for assessment of the laws and practicalities behind all of the various litigation, settlements, regulatory actions, and, most especially, the claims between the Ontario insured and its two Ontario primary insurers

The Court also rejected arguments that New York was clearly more appropriate for determination of excess and reinsurance liabilities under New York contracts for the global insurance market. While there were numerous secondary insurers, the question of excess liability is not central to the claim, rather, the fundamental issues are Ontario claims giving rise to Ontario liabilities in respect of which Vale seeks indemnity. Holding otherwise would have the excess insurance “tail” wagging the proverbial primary liability “dog” (para.164).

There is of course an interest in (c) avoiding a multiplicity of proceedings and (e) conflicting judgments, however, the fact the New York court accepted jurisdiction in not determinative of the position of the Canadian courts. Forum shopping is to be discouraged, and the fact Travellers filed first in New York is not relevant: the purpose of the FNC analysis is to find the most appropriate forum, and in that analysis first mover advantage is irrelevant. Quoting MacLachlan CJ in Amchem, the Court noted that:

“the desire to avoid [multiple proceedings or inconsistent outcomes] cannot overshadow the objective of the forum non conveniens analysis, which is ‘to ensure, if possible, that the action is tried in the jurisdiction that has the closest connection with the action and the parties’”

The Court noted further that the facts of the case, while complex, follows a simple structure common to insurance claims, viz, that the insured suffers a loss and seeks an indemnity from its primary insurer(s); insurer(s) in turn seek contribution or indemnity from other liable insurers. In the result, the Court describes Vale as the “natural plaintiff” in seeking coverage and RSA as the “natural plaintiff” in seeking contribution from excess or other insurers as appropriate in the circumstances. In the New York action, by contrast, Travellers is an “artificial plaintiff” who has not suffered a loss, placing Vale in the position of an “artificial defendant” in that litigation when they are in fact the primary party suffering a loss and seeking compensation.

[10] … the insurance issues arise out of an ordinary litigation structure in which Vale is the natural plaintiff and its insurers are the natural defendants. This structure cannot be justly or adequately replaced by a suit in which Travelers is the artificial plaintiff and Vale is the artificial defendant in the litigation reconstruction exercise Travelers has undertaken in New York.

In conclusion, the Court stated bluntly that “Canadian courts, including this court, have not hesitated to defer to foreign courts, including American courts, where the facts led justly to that outcome. This is not such a case.” (para.186).

Vale’s appeal regarding jurisdiction over North River were allowed, with costs.

The appeals of insurers were rejected, with costs.


While the decision here is clear and unambiguous, the New York appeal was determined in April 2023, with the panel unanimously upholding the decision of the motions judge and dismissing Vale’s FNC motion. Ref: No. 17109 Index No. 654028/21 Case No. 2022-02197.

With opposite decisions on motion and on appeal, stay tuned for a “supreme” showdown!