A recent decision from the Court of Appeal for Ontario reminds
us that parties using their contracts to select a jurisdiction for
hearing disputes must consider jurisdiction clauses carefully.
Exclusive jurisdiction clauses pick one jurisdiction, and only
one jurisdiction, whose courts will decide any disputes under the
contract. Canadian courts will generally uphold exclusive foreign
jurisdiction clauses, unless the party challenging the clause shows
“strong cause” why the clause should not be enforced
and an action in Canada should be permitted to proceed.
By contrast, non-exclusive jurisdiction clauses identify a
jurisdiction that the parties agree may hear their disputes but
accept that, in the appropriate circumstances, courts in other
jurisdictions may have jurisdiction over a dispute.
