The Supreme Court of Canada ruled Friday that a group of Ecuadorian villagers locked in a long legal battle with Chevron Corp. may sue the U.S. oil supermajor in an Ontario trial court as part of their effort to collect on a multi-billion-dollar pollution verdict.
"In a world in which businesses, assets and people cross borders with ease, courts are increasingly called upon to recognize and enforce judgments from other jurisdictions," Justice Clement Gascon wrote in a 7-0 ruling.
The dismissal of Chevron's appeal against a December ruling by the Ontario Court of Appeal means that the villagers can sue in Canada to collect on a $9.5 billion judgment they obtained in the Ecuadorian court system.
Courts in the South American country found that Texaco, which Chevron acquired in 2001, dumped billions of gallons of crude residue and toxic waste water in the Ecuadorian Amazon between 1964 and the early 1990s.
Chevron, which has no assets in Ecuador, has refused to pay, saying the court rulings against the company there lack merit and are the result of an unprecedented fraud.
The oil company says Texaco was cleared of liability two decades ago by Ecuador's then-government after performing remediation work and blames state-owned Petroecuador, which took over sole operations in the Ecuadorian Amazon after 1992, for the pollution.
After learning of the Canadian high court's verdict, Chevron spokesman Morgan Crinklaw said Friday's "decision has no bearing on the legitimacy or enforceability of the fraudulent Ecuadorean judgment."
"Instead, the Supreme Court of Canada has simply decided that the Ontario trial court has jurisdiction to entertain further proceedings in the action."
In its decision, Canada's high court said "sometimes successful recognition and enforcement in another forum is the only means by which a foreign judgment creditor can obtain its due."
But it also made clear that even if the Ontario court rules in favor of the Ecuadorian plaintiffs, that does not automatically mean that "Chevron Canada's shares or assets will be available to satisfy Chevron's debt."