Executive Summary: Key Legal and Evidentiary Issues

• Dispute centered on which contractual terms governed the relationship between QSL Canada Inc. and United States Steel Corporation (USS) regarding stevedoring services and liability limits.

• Determination of whether QSL’s standard terms, including a limitation of liability clause, or USS’s purchase order terms applied to the 2022 contract.

• Assessment of whether USS had adequate notice and knowledge of QSL’s limitation of liability clause.

• Consideration of the role and legal effect of unsigned agreements and the parties’ longstanding business practices.

• Evaluation of whether the issues were suitable for summary trial and if sufficient evidence existed for adjudication.

• Decision on the enforceability of the limitation of liability clause and the awarding of costs to the prevailing party.

Facts and outcome of the case

Background and parties

QSL Canada Inc. (QSL), a company providing stevedoring, logistics, and storage services, brought a motion for summary trial against United States Steel Corporation (USS) in a dispute arising from the handling of iron ore pellets at the Port of Québec. Cliffs Mining Company (Cliffs) was also a defendant in the underlying action but did not actively participate in this motion. The dispute stemmed from a July 2022 incident where QSL mistakenly loaded a mixture of iron ore pellets belonging to both USS and Cliffs onto a vessel, resulting in the commingling and alleged misappropriation of USS’s cargo.

Contractual relationship and legal issues

The core legal issue was which contractual terms governed the relationship between QSL and USS at the time of the incident. QSL argued that its standard terms and conditions, including a limitation of liability clause, applied through a proposed agreement sent to USS in March 2022. USS contended that its own purchase order terms should govern or, alternatively, that only commercial terms had been agreed upon, with no binding contractual terms or conditions.

The court examined the history of dealings between the parties, noting that QSL had sent similar agreements to USS for nearly two decades, with both parties signing in some years and USS ceasing to sign after 2012. Despite the lack of signatures in recent years, the court found that USS’s conduct—directing cargo to QSL’s facility after receiving the proposed agreement—objectively indicated acceptance of QSL’s terms. The court also considered the introduction of purchase orders by USS in 2015 and concluded that these served primarily administrative purposes rather than establishing contractual terms.

Notice and enforceability of limitation of liability

USS challenged the enforceability of QSL’s limitation of liability clause, arguing that it had not been adequately brought to its attention and was therefore unenforceable. The court reviewed the evidence and determined that USS had received sufficient notice of QSL’s standard terms, including the limitation of liability clause, through repeated references in agreements and accessible links provided in the documentation. The court distinguished this situation from cases where onerous terms were hidden or not adequately disclosed, finding that USS had the opportunity to review the terms over many years of business dealings.

Outcome and costs

The court ruled in favor of QSL Canada Inc., holding that the proposed agreement and QSL’s standard terms, including the limitation of liability clause, governed the contractual relationship between QSL and USS for the 2022 season. The limitation of liability clause was found to be enforceable. As the prevailing party, QSL was awarded a lump-sum, all-inclusive cost of $40,000. The case will continue for resolution of any remaining issues, including potential damages, but the court’s decision on the contractual terms and limitation of liability stands as a significant outcome in this phase of the litigation.