Case of the Day: Mitchison v. Zerona International

Letters Blogatory contributor Alejandro Manevich comments on a recent Ontario decision construing the Hague Service Convention to forbid a plaintiff himself to deliver a summons to a defendant in a country that has not objected to service under Article 10(c), even if the plaintiff is a competent person to serve process under the law of the receiving state. This is an interesting problem, and one I hadn’t considered before—the problem can’t really arise in the US courts, where plaintiffs cannot serve process themselves.

The case of the day is Mitchison v. Zerona International Inc., 2014 ONSC 4738, a recent decision by the estimable Master Glustein of the Ontario Superior Court, where he allowed the defendant’s motion to set aside service of an amended statement of claim for failure to comply with the Hague Service Convention.  The case raises an unusual and novel (at least in Ontario) issue on the interpretation of art. 10(c): though it appears at first to be another example of the strict formalism of the Convention, on closer examination it contains much more interesting ramifications.

The litigation concerned a dispute over the sale of an Ontario franchise. The plaintiffs, James and Christina Mitchison, had initially issued their statement of claim in November 2012 against Zerona Canada, whose defence in turn pleaded that the contract at issue was in fact with a discrete company, Zerona International, based in Barbados.  The plaintiffs amended their claim to add International as a separate defendant, then in October 2013 sought to serve it. Mr. Mitchison, with a Canadian news film crew in tow, went to Barbados in person and delivered copies of the amended claim to International at its registered office, and to one of its directors at her residence in Barbados.

There was clearly no question whatsoever that International had actual notice of the claim, then. But actual notice isn’t relevant: as the Ontario Court of Appeal held last year in Khan Resources Inc. v. Atomredmetzoloto JSC, 2013 ONCA 189, the Convention is a complete code, so courts cannot excuse even technical non-compliance. Under r. 17.05(3) of the Ontario Rules of Civil Procedure, service to a contracting state must be either (a) through the central authority of that contracting state, or (b) in a manner that is both “permitted by the Convention” and would be allowed under the Ontario rules if the document were served here.  Since Ontario law would allow Mr. Mitchison to act as his own process server, the issue was solely whether such service was “permitted by the Convention”:  specifically, whether it fell under art. 10(c), which states that the Convention does not infringe a party’s “freedom … to effect service of judicial documents directly through the judicial officers, officials or other competent persons of the State of destination.

As the court had done in Khan Resources, the Master (the equivalent of a magistrate judge in U.S. federal courts) relied on the Convention explanatory documents, specifically the 2006 Practical Handbook and the 2009 Outline, to provide needed context for the interpretation. He noted that the focus on the concept of “transmission” indicates a distinction between  the “person interested in a judicial proceeding” (in this case, the plaintiff) and the “competent persons of the State of destination”:

The mechanism of requiring transmission to a different person for service ensures at least some level of control of the means of service in the state of destination by a competent person of that state of destination.

Otherwise, judgment against a foreign defendant could be obtained simply by an individual who is “interested in a judicial proceeding” swearing that he or she attended in the foreign jurisdiction to deliver the document.  Such an interpretation runs contrary to the role of the “transmission” of the document between states to ensure some oversight over service by the state of destination. [at paras. 47-48]

For this reason, he was unimpressed by the plaintiffs’ argument that Barbadian law also would permit a plaintiff, acting without an intermediary or agent, to personally serve a claim on a defendant.  In his view, this merely showed that Mr. Mitchison “would be able to effect service under Barbados law if he had issued the Claim in Barbados.” [at para. 49]

This is, perhaps, a case only a lawyer could love; I suspect most non-lawyers would consider it perverse in the extreme to set aside service because of what seems to be a picayune technicality. But Master Glustein has zeroed in on a fundamental issue: the action of transmitting a document from one state to another, one of the necessary elements for the Convention to apply. That the plaintiff could have effected service under Bahamian law is irrelevant because the Convention is not concerned with the substantive rules on effecting service of process within the receiving state. Transmission and service are related but distinct concepts, and here the question is what it means to transmit the document from the sending state to the receiving state. Master Glustein concludes, in my view correctly, that the language, structure, and intent of the Convention mean that the transmission cannot be “received” in the receiving state by the very same person who sent it. As he notes, this also has aspects of judicial comity. That is far more than a mere technical matter.

7 thoughts on “Case of the Day: Mitchison v. Zerona International

  1. Thanks, Alex, for the interesting analysis. This is a novel issue for me, and a tricky one, I think. Consider the following hypothetical: instead of traveling to Barbados himself to serve the documents, Mitcheson delivered the summons to an Ontario private process server, who then traveled to Barbados to serve the documents. Let’s assume that the Ontario private process server is a competent person under the law of Barbados—that seems to be the case. Do you think that service would be okay?

    1. Ted, I think the reasoning of Master Glustein’s decision is to the effect that the document to be served must be “transmitted” to Barbados, then served on the defendant by an officer or other person in Barbados. That would appear to exclude the scenario you suggest, even if it doesn’t quite fall inside the mischief that Master Glustein believed should be avoided.

      To take an even odder example, what if the plaintiffs had asked a Barbadian process server to fly to Toronto to pick up the amended statement of claim, and he then flew back to Barbados with it and served it? Would this be impermissible as well?

      Arguably Master Glustein’s interpretation could lead to some peculiar results; I struggled with it at first for that reason. But doctrinal messiness is par for the course for private international law. As my friend and former professor Angela Swan memorably put it, “Imagining, let alone believing that traditional conflict rules are logical or make sense
      is a sure path to serious cognitive dissonance and profound despair.”

      Alex

      1. Alex, I agree with you. But I think that just goes to show that maybe the decision isn’t correct. Consider Article 8: “Each Contracting State shall be free to effect service of judicial documents upon persons abroad, without application of any compulsion, directly through its diplomatic or consular agents.” It doesn’t make any sense to think that service under Article 8 would be okay if the plaintiff transmits the summons from the state of origin to the consular officer in the state of destination, but that it would not be okay if, for example, the plaintiff gives it to the consular official while he’s on a trip home and the consular official travels with it to the state of destination and then serves it. Or take Article 10(b). Can it really be that the competent official must transmit the document across national borders to the competent person of the state of destination if the competent person of the state of destination picks up the papers while visiting the state of origin? The same seems to be true of Article 10(c) as well: suppose the Canadian plaintiff hired a Barbados process server to serve process, and the process server came to Canada to pick up the documents.

        If my intuition is right about this, what about the textual problem of Article 1 (“occasion to transmit a judicial … document for service abroad”)? One suggestion: Articles 8, 9, and 10 each contain language suggesting that in some way their procedures derogate from the ordinary requirements of the Convention (states “shall be free” to effect service under Articles 8 or 9; the Convention “shall not interfere with” the methods of service permitted by Article 10). So to summarize this view: the Convention applies whenever, in order to accomplish the service, you ordinarily would transmit the document from the state of origin to the state of destination, and the ordinary way to do this is via the main channel provided by Article 5; but the alternate methods of service permitted by the Convention operate notwithstanding that ordinary rule. This view has problems, too, e.g., how to deal with the relatively common case of service on a defendant abroad by delivery of the documents to his counsel in the forum state. In short, I don’t know what the answer is, but the outcome in the Ontario case seems problematic.

        1. Ted,

          I agree, this is an unusual case. But on reflection, I may have made it seem more unusual than it needs to be, by speculating on a broader reading than was intended.

          I think the confusion has arisen because Master Glustein uses “transmission” in two different ways. In art. 1, “transmission” refers to transporting the document from the forum state to the destination state: the focus is on where the document is going, not who effects the transmission, or who effects service in the destination state. However, he also uses it in the context of art. 10(c) to mean the act of handing over the document from the interested party to the competent person (see e.g. paras. 40, 47, and 52 of his reasons). Of course, art. 10(c) does not use the words “transmit” or “transmission”: though art. 10(c) is referred to as one of the alternative “channels of transmission”, the article concerns a mechanism for “effecting service.”

          On a closer reading, I think Master Glustein is simply saying that art. 10(c) requires that the “interested party” deliver the document to a person “of the State of destination”, who then effects service. He doesn’t, however, say anything about where that person may be located at the time the document is handed over. Arguably there should be no reason why one could not make use of art. 10(c) by handing a document for service to a Barbadian “competent person” who happens to be located outside Barbados at the time. In that case, the same person effecting service would also effect transmission, but that seems neither here nor there (if you’ll excuse the pun).

          On a different note, I have to wonder whether the dispute over service was in fact entirely unnecessary. The Hague Convention does not even come into play where the law of the forum does not require service abroad, and as best I can tell there was some evidence that Zerona International and its director, Giselle Briden, could have been served in Ontario. Ontario Rule 16.01(1) allows service on a “person outside Ontario carrying on business in Ontario” by “leaving a copy of the document with anyone in Ontario carrying on business for the person.” A brief WHOIS search of Zerona Canada’s website shows that it has the same administrative contact e-mail address as some two dozen or more other Zerona-related websites. The registration information for those sites, in turn, often refers to either “Zerona Canada International” or “Zerona International”, located at the same Ontario addresses and with the same Ontario contact person, namely Giselle Briden. While hardly conclusive, this certainly suggests that all three defendants were in substance carrying on business in Ontario, irrespective of where they were incorporated or residing.

          So why bother with flying to Barbados, TV cameras in tow? Perhaps the plaintiffs felt that the defendants had been dealing from the bottom of the deck from day one, and that the bright light of publicity might be more effective than the slow wheels of justice?

          Alex

  2. There’s not a lot of these kinds of cases. I suppose people just don’t take the risks of it not working out.

    I noticed there’s multiple plaintiffs.

    What’re your thoughts on if Plaintiff A (competent person of state of origin) transmits the document to Plaintiff B—pedantically let’s say he’s in the state of destination at the time—who then serves the document.

    If the issue is that the person who served the claim and who “transmitted” the claim to be served are the same person, if the 1st Plaintiff gives it to the 2nd, and the 2nd serves it, wouldn’t that qualify as ‘transmitting?’, and we’d have to move on to the issue of competency, which Master Glustein seems to recognize as a given (Para 49)?

    Seems a strange decision that entirely skips across what “competent person of the state of destination” means and focuses improperly on the word “other” in section 10(b) or (c) of the Hague Convention.

    It says:10(b) the freedom of judicial officers, officials or other competent persons of the State of origin to effect service of judicial documents directly through the judicial officers, officials or other competent persons of the State of destination, ”

    Seems on plain reading that the “other” modifies the list beginning with ‘judicial officers, officials…” as in Here’s two explicitly “competent” persons of the State of destination, but any “competent person” of the state of destination will do.

    Looks to me that “competency” refers to whether a person is permitted to serve documents in the state of destination: Pitman v. Mol, 2014 ONSC 2551 Service was permitted in that case based on the server being licensed, as is required in Georgia. In a state (like Barbados) if the Plaintiff B is permitted to serve documents under their law, that qualifies them as ‘competent person of the state of destination’ for service purposes, doesn’t it?

    Master Glustein seems to say the Mitchison Plaintiff’s interpretation runs contrary to oversight by the State of Destination, but that didn’t happen in Pitman. All Pitman required was that the person doing the service was authorized in Georgia to process serve.

    It still confuses me then, even if all the above is accepted, what “of the state of destination” mean—Is that Citizenship, right to work, Currently residing in per local laws, Physically located … Or is it just a Whole phrase subject, requiring the person to whom the document is transmitted to be recognized as “competent [for serving documents] within the state of destination’s jurisdiction”?

    1. Ooh! I like your hypothetical, Aaron. I think what this case really teaches, on a very practical level, is that conservatism is your best bet when serving process. If time is not at a premium, I always prefer to use the central authority mechanism. By the way, this is true domestically, too. If there’s no rush, I always prefer to send the summons to the sheriff and let things take their ordinary, predictable, and defensible course.

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