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Last Friday’s decision by the Supreme Court to allow “Ecuadorian villagers” to pursue a US$9.5-billion claim against California-based oil giant Chevron in Ontario stresses that the merits — or otherwise — of the case were never at issue.
The decision was about jurisdiction, not justice. But since the case has been dubbed “the legal fraud of the century,” a cynic might suggest that that the decision was analogous to the Supremes being primarily concerned about whether an individual who engaged in a holdup had a proper gun licence.
The nine judges do make reference in their unanimous decision to a devastating U.S. district court finding that the Ecuadorian claim was rooted in massive fraud perpetrated by Steve Donziger, the American lawyer driving the case. But, wrote Justice Clement Gascon, “That decision, and the underlying allegations of fraud are not before this Court.” Undoubtedly those allegations, and the U.S. decision, will be a very big part of the proceedings when the case returns to Ontario.
Certainly, global trade and investment depends on the rule of law, and, according to Justice Gascon, “Canadian courts, like many others, have adopted a generous and liberal approach to the recognition and enforcement of foreign judgments.” But how generous and liberal should Canadian courts be to judgments that stink to high heaven?
Meanwhile the case doesn’t deal merely with the alleged fraud by Donziger on the Ecuadorian judicial system, but the question of fraud by that system. Not only did Donziger bribe and threaten judges, the whole legal system is suspect because it is subject to the whim of Ecuador’s president Rafael Correa, an increasingly unpopular leftist who rules by intimidation and has effectively shut down the free press.
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