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Foreign plaintiffs can access Canadian courts for claims against parent companies over subsidiaries liability for abuses abroad

Author: Aidan Macnab, Canadian Lawyer, Published on: 14 August 2019

"Canadian companies can face legal action in Canada for subsidiary’s crimes in foreign jurisdictions", 6 Aug 2019

A recently concluded lawsuit against a mining company shows that Canadian companies can face legal action in Canada for the actions of their subsidiaries in other jurisdictions.

On July 30, Vancouver-based Pan American Silver Corp. announced they had settled out-of-court with and apologized to four Guatemalan men who were shot by security guards during a protest near a silver mine, in 2013. The Escobal Mine in San Rafael Las Flores, Santa Rosa in Guatemala was then run by Tahoe Resources Inc. The men, who were among others protesting what they said was a lack of community consultation by the company, brought a civil suit against Tahoe in the B.C. Supreme Court in 2014. This February, Pan American acquired Tahoe...

At the trial level, Tahoe asked the court to reject its own jurisdiction on the grounds of forum non conveniens, arguing that Guatemala was a more appropriate venue for the plaintiffs to try their claim. B.C. Supreme Court Justice Laura Gerow granted the order.

“The question is not whether Canada’s legal system is fairer and more efficient than Guatemala’s legal system. It is whether the foreign legal system is capable of providing justice,” wrote Gerow in her decision. Gerow stated that Canadian courts must be cautious in denying a foreign court the right to deliver justice to its own citizens, in case Canada is given the same treatment in return...

“So, what the B.C. Court of Appeal decision does is it affirms that the starting point is a presumption that Canadian courts have primary jurisdiction over Canadian companies,” Fiorante says. “So that's the default position. And it’s only if it’s plain and obvious or absolutely clear that the foreign court is better placed to do justice that the case should be dismissed on forum non conveniens grounds.”...

 

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Related companies: Pan American Silver Tahoe Resources (part of Pan American Silver)