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CIVIL PROCEDURE - Pleadings - Striking out pleadings or allegations - Grounds - Failure to disclose a cause of action or defence - Lack of jurisdiction

Monday, December 04, 2017 @ 12:37 PM  


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Appeal by the defendant, Nevsun Resources, from an order refusing to strike, stay or dismiss the action by the plaintiffs, Araya, Fshazion and Tekle. The plaintiffs were refugees of Eritrea and the defendant was a British Columbia publicly held company. The plaintiffs alleged the defendant entered into a commercial gold mining venture with Eritrean state-owned or state-controlled companies. They alleged that Eritrea, as a rogue state, arranged for building the mine using forced conscripted labour characterized by slavery, coercion, threats of torture, and crimes against humanity. They alleged that the defendant aided and abetted, and/or ordered and solicited, and/or was complicit or acquiesced in the impugned conduct. The plaintiffs commenced litigation against the defendant on their own behalf and on behalf of approximately 1,000 Eritrean nationals forced to work at the mine. The action relied on private torts and breaches of international law. The defendant denied the allegations. It brought a preliminary application to strike, stay or dismiss the claims on jurisdictional grounds, and on the basis the claims were barred by the act of state doctrine, were based on alleged breaches of customary international law that were not justiciable, or failed to disclose a cause of action. The application judge refused the relief sought, citing the uncertain scope and application of the act of state doctrine, and the unsettled nature of the nature and application of customary international law within Canada. The defendant appealed.

HELD: Appeal dismissed. The chambers judge did not err in admitting secondary documentary reports on Eritrean country conditions for the limited purpose of providing a social, historical and contextual framework to the first-hand allegations or properly attributed hearsay. In addition, the chambers judge's use of those reports did not exceed the limited purpose for which they were admitted. The chambers judge did not err in the assessment of forum conveniens and in refusing to decline jurisdiction. Despite the practical difficulties associated with proceeding in British Columbia, the judge was right to prefer British Columbia as the jurisdiction in which the plaintiffs could assert their claims in a fair and impartial proceeding over a jurisdiction in which justice seemed unlikely to be done. The chambers judge erred in applying a plain and obvious test to determining whether the plaintiffs' claims were barred by the act of state doctrine. However, the error was of no consequence, as the doctrine did not apply to the plaintiffs' action given its foundation upon the defendant's complicity in unlawful acts, the absence of any claims affecting Eritrea's general legal position, and the availability of the public policy exception. The plaintiffs' pursuit of claims under customary international law faced significant legal obstacles, but could not be regarded as bound to fail.

Araya v. Nevsun Resources Ltd., [2017] B.C.J. No. 2318, British Columbia Court of Appeal, M.V. Newbury, P.M. Willcock and G. Dickson JJ.A., November 21, 2017. Digest No. TLD-December42017001