1. Society of Lloyd's c. Alper, [2006] Q.J. No. 1915

Society of Lloyd's c. Alper, [2006] Q.J. No. 1915

Jugements du Québec

 

 

Quebec Superior Court

 (Simplified Procedure)

 District of Montreal

The Honourable Sylvie Devito, J.S.C.

Heard: September 12 and 13, 2005.

Judgment: March 3, 2006.

No.: 500-17-015612-032

 

[2006] Q.J. No. 1915   |   2006 QCCS 1203   |   J.E. 2006-717   |   EYB 2006-102214

THE SOCIETY OF LLOYD'S, Plaintiff v. SEYMOUR ALPER, Defendant


(100 paras.)

Résumé

 

 



International — Recognition and enforcement of foreign judgments — Enforcement of foreign judgments — Recognition of judgments of foreign state — Lloyd's sought recognition and enforcement of a monetary judgment issued in its favour against Alper by English High Court of Justice — Judgment recognized and declared enforceable — The manner in which judgment was rendered did not offend fundamental principles of procedure in Quebec courts — The circumstances evidenced by other related judgments amply provide the reasons and rationality behind the judgment and assured the guaranty against arbitrariness — Monetary conclusions of judgment not manifestly inconsistent with public order as understood in international relations — Civil Code of Quebec, art. 3155.

Society of Lloyd's (Lloyd's) sought recognition and enforcement of a monetary judgment issued in its favour against Quebec defendant, Alper, on March 11, 1998, by the High Court of Justice, Queen's Bench Division, Commercial Court, London, England, for CDN $708,138 -- This judgment was the culmination and result of a series of test cases managed through the English courts -- Alper was a "Name", an individual who underwrote insurance through Lloyd's syndicates -- The General Undertaking bound the Names to comply with directions imposed by Lloyd's Council -- Like the other documents signed, it mandated that disputes with Lloyd's must be heard in the English courts and be governed by the laws of England -- Names have unlimited liability to the extent of all their assets in respect of their insurance obligations at Lloyd's -- Lloyd's had financial difficulties due to asbestos exposure claims and had to reorganize itself through a Reconstruction and Renewal Plan (the Plan) -- The Names sued Lloyd's on the ground of fraudulent conduct and misrepresentations by Lloyd's related to asbestos losses -- In order to effect the Plan, a contract of reinsurance was entered into with a group of companies known as "Equitas" -- The Names who did not accept the Plan still had their liabilities mandatorily reinsured by Equitas -- Lloyd's compelled them to contract with Equitas -- Clause 5.5 of the reinsurance contract provided that each Name was obliged to pay his premium free and clear from any set-off, counterclaim or other deduction, including in respect of claims against Lloyd's -- According to Alper, the judgment was not susceptible of recognition and enforcement by the Quebec court -- It contained no reasons, which Alper claimed rendered it in contravention of fundamental principles of procedure -- HELD: Lloyd's motion maintained -- Judgment recognized and declared enforceable -- The Court found that the manner in which the judgment was rendered did not offend fundamental principles of procedure in Quebec courts -- The circumstances evidenced by other related judgments amply provided the reasons and rationality behind the judgment and assured the guaranty against arbitrariness -- The monetary conclusions of the judgment were not manifestly inconsistent with public order as understood in international relations.

Statutes, Regulations and Rules Cited:

 

 


Civil Code of Quebec, art. 1619, art. 2809, art. 3135-3168, art. 3155, art. 3155(3), art. 3155(5), art. 3157, art. 3158, art. 3161


Code of Civil Procedure of Quebec, art. 75.1, art. 165(4), art. 471, art. 547, art. 785, art. 786


Quebec Charter of Human Rights and Freedoms, art. 23

Counsel

 

 


Ronald L. Stein (De Granpré Chait), Attorney for Plaintiff. Edward E. Aronoff (McMillan Binch Mendelsohn), Attorney for Defendant.

 


JUDGMENT


INTRODUCTION


1By its Amended Originating Motion based on Article 3155 of the Civil Code of Quebec ("C.C.Q.") and Articles 785 and 786 of the Code of Civil Procedure of Quebec ("C.C.P."), Plaintiff, The Society of Lloyd's, seeks recognition and enforcement of a monetary judgment issued in its favour against Quebec Defendant, Seymour Alper, on March 11, 1998, by the High Court of Justice, Queen's Bench Division, Commercial Court, in the City of London, England ("Judgment P-1").


2Judgment P-1 condemns Defendant to pay to Plaintiff the sum of GBP305,284.85 ($708,138.74 CDN)1.


3It essentially comprises two paragraphs which read as follows:

[...]

 

 

The Defendant having given notice of intention to defend herein and the Court having under Order 14, rule 3 ordered that the Judgment as hereinafter provided be entered for the Plaintiff against the Defendant.

 

 

IT IS THIS DAY ADJUDGED that the Defendant do pay the Plaintiff the sum of $305,284.85 being $271,837.29 principal and $33,447.56 interest together with costs to be taxed if not agreed.

 

 

[...]

 

 

FACTUAL BACKGROUND TO THE LITIGATION BETWEEN PLAINTIFF AND DEFENDANT


4Judgment P-1 is, as Defendant mentions in his plea, "the culmination and result" for Defendant, of a series of test cases managed through the English courts, which dealt with the litigation between Plaintiff and "Names".


5"Names" are individuals who underwrite insurance through Lloyd's syndicates.


6Defendant was a "Name".


7The factual background of what can be referred to as the "Lloyd's litigation" has been repeated in numerous judgments in England, the United States, Canada and other jurisdictions which have dealt with the various aspects of this litigation.


8Both Plaintiff and Defendant agree to refer this Court to the recital of facts made by Justice Katherine Swinton of the Superior Court of Justice of Ontario, Commercial Court Division, in her judgment dated March 7, 2000, relating to other Canadian "Names", in the case of The Society of Lloyd's and Paul F. Saunders2. This recital was adopted by the Court of Appeal in Justice Feldman's reasons in the decision dated August 29, 2001, in the appeal from said judgment3.


9Justice Swinton's recital filed as D-1 is most useful in order to comprehend the circumstances of the Lloyd's litigation which ultimately led to Judgment P-1:

The Factual Background

 

 

Lloyd's does not carry on an insurance business. Instead, the function of Lloyd's is to regulate and provide services to the Lloyd's insurance market. Underwriting is carried out by "Names" - individuals who underwrite insurance through Lloyd's syndicates. All of the respondents here have been Names.

 

 

Affidavits filed by the respondents indicate the way in which some of the Names were recruited by Lloyd's. For example, Jacqueline Levin indicates that she was recruited by Lloyd's agents in Ontario. She stated that an application for membership must be made through a Members' Agent, authorized by Lloyd's to recruit members. She also had to attend a Rota Committee interview in London, England, where she was questioned about becoming a member of Lloyd's by a member of the Council of Lloyd's, the Society's governing body. After being accepted, she then signed the necessary documents in England, and she was given copies. The affidavit of Paul F. Saunders outlines in more detail the written information he received prior to becoming a member.

 

 

To be accepted for membership, the Names were required to enter into a series of agreements with the Members' Agent and Lloyd's itself, including the General Undertaking, the Agency Agreement and the Lloyd's Underwriting Members' Security Agreement. The General Undertaking bound the Names to comply with directions imposed by Lloyd's Council. Like the other documents signed, it mandated that disputes with Lloyd's must be heard in the English Courts and be governed by the laws of England. For example, Clause 2.1 reads:

 

 

The rights and obligations of the parties arising out of or relating to the member's membership of, and/or underwriting of insurance business at, Lloyd's and any other matter referred to in this Undertaking shall be governed by and construed in accordance with the Laws of England.

 

 

 

Each Name must lodge a deposit with Lloyd's equal to a certain percentage of the premium income, normally in the form of a letter of credit. As well, Names must appoint a registered Members' Agent to act on their behalf, to whom they delegate the complete control of their affairs at Lloyd's.

 

 

The Names group together in syndicates, which are managed by a Managing Agent, whose name is often associated with the syndicate. A syndicate is not a legal entity nor a partnership; rather, it is simply a group of Names who join a particular syndicate for a particular underwriting year. Each policy of insurance issued at Lloyd's consists of individual contracts made on behalf of the individual Names participating in the syndicate. Each Name is only liable for his share of the risk, but not for the share of any other Name. However, the Name has unlimited liability to the extent of all his assets in respect of his insurance obligations at Lloyd's.

 

 

All premiums received for insurance policies are credited to a Premiums Trust Fund, which is governed by a Premiums Trust Deed. Its prime purpose is for the protection of policy holders. Each member is also required to make annual mandatory contributions to the Central Fund, which exists primarily to protect policy holders. It is used if claims cannot be satisfied through the Names' Lloyd's funds and personal assets.

 

 

The respondents allege that Lloyd's acted fraudulently in concealing the magnitude of risks associated with asbestos exposure claims arising in the United States from about mid-1980. Normally, the accounts of a syndicate are left open for three years in order to defer the distribution of the profit until the pattern of claims' settlement for the syndicate year in question can be determined with reasonable certainty. Reinsurance to close is obtained, usually by paying a premium to the following underwriting year of the same syndicate. This premium is intended to cover the total outstanding claims, including those not yet reported in respect of risks signed in the year of account and those still outstanding from all previous years. However, if the closing reserve cannot be calculated with sufficient certainty, and there are insufficient funds to purchase reinsurance to close, the syndicate is left open.

 

 

The respondents allege that despite the impossibility of determining the liability in respect of asbestosis, virtually every syndicate closed its 1979 year of account at December 31, 1981, taking reserves over a series of years in an attempt to spread the losses over the Names who underwrote the syndicates throughout the 1980's. Apparently during the 1980's, Lloyd's recruited a considerable number of new Names. The respondents state that they were generally recruited in 1986 and after, becoming Names in 1987 and subsequent years, although the affidavit of Eric Mellish Lane indicates that he became a Name in 1979. They believe that Lloyd's misrepresented to them the risks to which they were exposed from asbestos and other long tail risks. Specifically, Lloyd's knowledge of future enormous and unquantifiable losses and its failure to disclose this information are alleged to be fraudulent conduct. So, too, was the publication of Lloyd's Global Accounts, which are alleged to have contained misleading information about the financial health of the syndicates.

 

 

By 1991 or 1992, the insurance market was in crisis. Lloyd's made cash calls on the Names and threatened to draw upon their letters of credit. In 1991, a group of Canadian Names issued a Statement of Claim in Ontario against Lloyd's and a number of banks, seeking an injunction to prevent the banks from paying out on the letters of credit, and preventing Lloyd's from trying to draw down on the letters of credit. They argued that their contracts with Lloyd's were void ab initio as having been induced by fraud and made in contravention of the Securities Act. Lloyd's brought a motion to stay the action on the basis of forum non conveniens, and was successful. McKeown J. determined that the proper forum for the determination of the issues was the United Kingdom because of the choice of law clause in Lloyd's General Undertaking. In addition, he determined that the English courts should take jurisdiction because the proceeding had a more substantial connection to England (Ash v. Lloyd's Corp., (1991), 6 O.R. (3d) 235 (Gen. Div.) at 248). That decision was upheld by the Court of Appeal, (1992), 9 O.R. (3d) 755 (C.A.); leave to appeal refused by the Supreme Court of Canada, [1992] S.C.C.A. No. 357, October 8, 1992). Writing for the Court of Appeal, Carthy J.A. stated at 758:

 

 

With a starting point of treating Lloyd's as the engine of the defence and treating the claims against it as the prominent concern in selecting a forum, I endorse the entirety of McKeown J.'s reasons for staying the action against Lloyd's. Even without the exclusive jurisdiction clauses, the contracts are to be performed in England, the alleged wrongful conduct was on the part of a large number of English residents who carry out the day-to-day functions under Lloyd's jurisdiction, and the overall picture is of an overwhelming affinity to England.

 

 

 

Lloyd's drew down the Names' letters of credit, but also made cash calls. When the respondents did not pay the cash calls, Lloyd's paid the losses from the Central Fund, and in 1992 brought an action in the High Court of Justice of the United Kingdom against many of the respondents for reimbursement of the amounts paid. One of the defendants, Dr. Gian Carlo Mason from Hamilton, Ontario, filed a defence and counterclaim denying that there was money owing to Lloyd's because of the fraudulent conduct and misrepresentations by Lloyd's related to asbestos losses. This action has never proceeded to trial as a result of an order of the Commercial Court of the High Court of Justice that Lloyd's was not required to proceed with the Mason case and could leave it in abeyance while it pursued the Clementson case, which raised defences relating to European Community law. To date, none of the Central Fund Writs cases has proceeded.

 

 

After 1993, a number of cases brought by action groups of Names against Managing Agents for negligence went to trial or settled. When the Names succeeded, damages were awarded to them. Some of the respondents here were successful in these actions. In subsequent litigation, the House of Lords determined that the litigation recoveries of the Names related to negligent underwriting are part of the Premiums Trust Funds. Similarly, litigation recoveries related to negligent advice in portfolio selection are part of the Premiums Trust Funds to the extent provided in the Premiums Trust Deeds. Lloyd's is the Regulating Trustee of Names' Premiums Trust Funds. In its capacity as Trustee, Lloyd's is entitled to those litigation recoveries and must deal with them in accordance with the Premiums Trust Deeds (The Society of Lloyd's v. Robinson, [1999] H.L.J. No. 17, House of Lords, reasons delivered March 25, 1999). Those funds are currently held by various solicitors for the action groups in escrow accounts, and there is ongoing dispute about their release.

 

 

Because of the chaos in the insurance market and in order to keep Lloyd's viable, Lloyd's sought a way to settle all the litigation in the market and the outstanding claims. In July, 1996, as part of its Reconstruction and Renewal Plan ("R & R Plan"), Lloyd's made an offer to Names worldwide to settle claims in respect to their 1992 and prior underwriting years. In order to effect the R & R Plan, a contract of reinsurance was entered into with a group of companies known as "Equitas". The Equitas reinsurance contract covered the entire non-life insurance market for the 1992 and prior underwriting years. Those Names who accepted the offer waived all claims against Lloyd's, Equitas, agents and auditors in respect of 1992 and prior years.

 

 

While the offer was accepted by a vast majority of Names worldwide, the respondents did not do so. Nevertheless, those Names who did not accept the R & R Settlement Offer still had their liabilities mandatorily reinsured by Equitas. Lloyd's compelled them to contract with Equitas by imposing upon them a replacement managing agent called "AUA9", which Lloyd's then directed to execute the reinsurance contracts on behalf of the Names. Lloyd's paid all Equitas premiums owing, and the rights to collect the Equitas premiums were then assigned to it. Clause 5.5 of the reinsurance contract provided that each Name was obliged to pay his premium free and clear from any set-off, counterclaim or other deduction, including in respect of claims against Lloyd's. It also provided for a waiver by the Name to any claim to a stay of execution on the judgment.

 

 

The English Court Proceedings

 

 

Lloyd's then commenced actions to recover the Equitas premiums from those Names who did not accept the R & R offer, including the respondents here. Various Names raised numerous defences, arguing that they were not bound because of their non-acceptance of the R & R settlement offer; that Lloyd's had exceeded its power to amend or enact by-laws in creating the R & R scheme; that the assignment to Equitas from Lloyd's was improper; that the fraud by Lloyd's gave rise to a right to rescind the Names' contract with Lloyd's; that fraud by Lloyd's should give rise to a set-off of the fraud claims against the premium claims; that a stay of execution should be granted until the determination of the fraud claims; and that Lloyd's had breached Canadian securities legislation. Issues of quantum were also raised.

 

 

In a series of test cases managed through the Commercial Court, Lloyd's moved under R.S.C. Orders 14 and 14A, which bear some similarity to Ontario's Rules 20 and 21 dealing with summary judgment and determination of a preliminary point of law. Under O. 14, r. 3, the English Court must ask whether there is "an issue or question in dispute which ought to be tried".

 

 

In a series of judgments, Justices Colman and Tuckey of the Commercial Court wrote lengthy reasons in which they stated that the defences raised were without merit. Their decisions were upheld by the Court of Appeal.

 

 

In The Society of Lloyd's v. Leighs (February 20, 1997), Colman J. rejected defences based on the fact that the Names had not accepted the R & R plan and therefore, could not be bound by it, and that Lloyd's had no title to sue in respect of moneys payable under the R & R plan. Canadian Names were intervenors in this proceeding. In a subsequent decision released on April 23, 1997, The Society of Lloyd's v. Wilkinson, he determined that even if Lloyd's had engaged in fraudulent conduct, the law of rescission would not apply in the circumstances because of the impossibility of restitutio in integrum. He also held that Clause 5.5 of the Equitas contract prevented the defendants from setting off their counterclaim for damages for fraud against Lloyd's claim for the Equitas premium, and that there should be no stay of execution against them with respect to the judgment for the Equitas premium.

 

 

The judgments of Colman J. were upheld by the Court of Appeal in The Society of Lloyd's v. Leighs, Lyon and Wilkinson [1997], N.L.O.R. No. 721 (reasons dated July 31, 1997, [1997] E.W.J. No. 387), and leave to appeal to the House of Lords was refused. Counsel appeared for 215 Canadian Names, who were granted intervenor status. The Court upheld the conclusions of Colman J. that the R & R By-law fell within the Society's powers, and the directions given to implement it were validly given; that the Names had not validly rescinded their General Undertakings and thereby avoided their contracts with Equitas concluded on their behalf by AUA9; that the Names were bound by the "no set off" provision in Clause 5.5 of the Equitas contract, given their agreement, at the time that they became Names, to be bound by the legislative and regulatory regime of the Society; and that clause prevented the non-accepting Names from raising claims of fraud against the Society in answer to a claim by the Society as assignee for the Name's premium. Finally, the Court refused to order a stay of execution.

 

 

Subsequently, Tuckey J. determined that there was no defence to the claim for the premiums based on the allegation that Lloyd's had failed to comply with Ontario securities law (The Society of Lloyd's v. Daly, reasons dated January 27, 1998). In doing so, he gave full effect to a legal opinion of James C. Baillie, Q.C., which had concluded that the actions of Lloyd's had contravened Ontario securities law because of the failure to file a prospectus, and thus, the obligations to Lloyd's would be unenforceable in Ontario. Tuckey J. nevertheless held that the enforcement of the contractual obligations in England was not against public policy, and thus, there was no defence available based on Ontario securities law. Subsequently, in March, 1998, summary judgment was awarded to Lloyd's for the various Equitas premium amounts. Tuckey J. granted a stay of execution until the determination of a leave to appeal application before the Court of Appeal, although he refused to order a general stay of execution.

 

 

Leave to appeal was then sought from the Court of Appeal. In lengthy reasons in Society of Lloyd's v. Fraser & Ors, [1998] E.W.J. No. 1045 the Court of Appeal denied leave to appeal from this judgment of Tuckey J. and others (reasons released July 31, 1998). The Court noted that there was no question here of enforcing a contract that would involve the infringement of an Ontario law, and there was no infringement of comity. The Court noted that if the Canadian Names were correct and their contracts with Lloyd's were void and unenforceable, then so, too, would be the insurance contracts which they had entered, because their contracts' validity depended upon the validity of the underwriting membership with Lloyd's (at 37). Lord Hobhouse concluded that "no principle of comity or public policy would suffice to justify that result". In the course of these reasons, he also stated with respect to the procedure that had been adopted:

 

 

Trials are necessary in order to determine triable issues of fact. It is not the function of the Court on an O.14 hearing to make findings of fact. It is its function to consider whether the affidavits lodged by the defendants in response to the O.14 summons raise triable issues of fact which are capable in law of providing the defendant with a defence to the claim or part of it. (at 29)

 

 

 

As a result of these decisions, the Equitas judgments are final in the United Kingdom as there is no further right to appeal. Lloyd's now seeks to enforce them in Ontario.

 

 

[...]

 

 

10Defendant was amongst the Canadian "Names" who did not accept the R & R Settlement Offer by Plaintiff and who, through counsel, appeared before the English courts in the judicial saga that ensued.


THE DEBATE


11According to Defendant, Judgment P-1 is not susceptible of recognition and enforcement by this Court as it comprises no reasons. He argues that because it is not motivated, this Court cannot ascertain whether it meets the standards of recognition under the provisions of subparagraphs (1) to (6) of Article 3155 C.C.Q.


12As mentioned above, Defendant recognizes that Judgment P-1 is the culmination of a series of test cases managed through the English courts, which deal with the litigation between Plaintiff and "Names" such as Defendant4, as described in recital D-1.


13He further admits that the judgment dated February 20, 1997, of Coleman J. in The Society of Lloyd's v. Leighs, which he produced as D-2, is the foundation for Judgment P-15. Judgment D-2 was upheld in appeal6.


14However, Defendant contends that the judgments resulting from the test cases7, including Judgment D-2, should not be relied on by Plaintiff nor by this Court unless Plaintiff also seeks and obtains their prior recognition. He admits he was a party to these judgments as an intervener. It is for that specific reason that he objects to the Court otherwise taking cognizance of these judgments for the purpose of establishing the circumstances of Judgment P-1 and for deciding the present motion.


15It is also Defendant's submission that Judgment P-1 cannot be recognized or enforced because it was rendered in contravention of the fundamental principles of procedure and therefore falls within the exception of subparagraph 3 of Article 3155 C.C.Q. His proposition is that, in the proceedings before the English courts, he was denied the fundamental right to have a trial in order to have his case adjudicated on its merits. In support of this contention, he refers to the preliminary provision of the C.C.Q., the rule of audi alteram partem and Article 23 of the Quebec Charter of Rights and Freedom8 which, according to him, have been infringed.


16Finally, in a more subsidiary manner, Defendant submits that the outcome of Judgment P-1 is manifestly inconsistent with public order as understood in international relations, as set out in subparagraph 5 of Article 3155 C.C.Q.


THE LAW


17The following provisions of the C.C.Q. are pertinent in the present matter:

Art. 3155. A Québec authority recognizes and, where applicable, declares enforceable any decision rendered outside Québec except in the following cases:

 

 

[...]

 

 

(3)    the decision was rendered in contravention of the fundamental principles of procedure;

 

 

[...]

 

 

(5)    the outcome of a foreign decision is manifestly inconsistent with public order as understood in international relations;

 

 

[...]

 

 

Art. 3157. Recognition or enforcement may not be refused on the sole ground that the original authority applied a law different from the law that would be applicable under the rules contained in this Book.

 

 

Art. 3158. A Québec authority confines itself to verifying whether the decision in respect of which recognition or enforcement is sought meets the requirements prescribed in this Title, without entering into any examination of the merits of the decision.

 

 

Art. 3161. Where a foreign decision orders a debtor to pay a sum of money expressed in foreign currency, a Québec authority converts the sum into Canadian currency at the rate of exchange prevailing on the day the decision became enforceable at the place where it was rendered.

 

 

The determination of interest payable under a foreign decision is governed by the law of the authority that rendered the decision until its conversion.

 

 

THE PROOF


18Mr. Nicholas Demery testified as Plaintiff's representative. As a solicitor since 1980, he confirmed his employment with Plaintiff where he has been working in the legal and litigation Department since 1983. He is responsible for the management of all cases concerning recognition of English judgments involving Plaintiff and "Names" in the United States and in Canada. He is therefore familiar with the case at bar.


19Mr. Demery filed a copy of Judgment P-1, together with a document entitled "Certificate under section 10 of the Foreign Judgment (Reciprocal Enforcement) Act 1933", issued by Paul Michael Miller, a Master of the Supreme Court of England and Wales (P-2).


20Master Miller thereby certifies:

-         that a Writ of Summons was issued out of the High Court of Justice, Queen's Bench Division, Commercial Court, by Plaintiff against Defendant on October 25, 1996;

-         that it was duly served upon Defendant on October 28, 1996;

-         that Defendant acknowledged said service by indicating in writing that he intended to defend to the proceedings;

-         that Judgment P-1 was obtained on March 11, 1998 for the amount mentioned;

-         that no objection was made to the jurisdiction of the Court;

-         that it bears interest at a rate of 8% per annum;

-         that it was served upon Defendant according to Civil Procedure rules;

-         that leave to appeal was refused before two instances;

-         that enforcement of Judgment P-1 is not stayed or suspended;

-         that it is enforceable.

 

 

 

21Mr. Demery further filed a document dated November 8, 1996 (P-3), which is the equivalent of an appearance, and which shows that upon being served with the original Writ of Summons, Defendant retained the services of Warner Cranston, Solicitors, to whom all papers about the case were to be sent. The proof will show that Defendant was in fact represented during the ensuing litigation.


22Mr. Demery then filed an excerpt of Order 40, Rule 8 of the Rules of the Supreme Court of Justice and the UK Judgments Act, 1838, chapter 110 and section 17, to establish when interest on Judgment P-1 begins to run (P-4). Defendant objected to the filing of this document as he contends Mr. Demery is not the proper witness to do so. The Court allowed Plaintiff to file P-4 under reserve of Defendant's objection. The Court will dispose of it further on as Objection No. 1.


23An affidavit of James Wade, Relationship Manager of the Hong Kong and Shanghai Banking Corporation, was filed as P-5, by consent, to establish the rate of exchange applicable on the date of Judgment P-19.


24Mr. Demery also filed the mise en demeure sent to Defendant on September 1998, whereby Plaintiff requested payment from Defendant as a result of Judgment P-1 (P-6).


25Finally, under reserve of Defendant's objection (same as Objection No. 1), the Court allowed Mr. Demery to file the Rules of the Supreme Court, Order 42, which deal (Rule 3) with the date of effect of Judgment P-1.


26During Mr. Demery's cross-examination, counsel for Defendant, with Plaintiff's consent, filed as D-4, excerpts of the Court of Appeal decision in Society of Lloyd's v. Fraser & Ors10. Counsel for Defendant questioned Mr. Demery on the status of the law pertaining to comments outlined in this judgment relating to Order 14 rulings.


27Through Mr. Demery, he also filed excerpts of a judgment of the Court of Appeal in Adams and Others v. Cape Industries PLC and Another (D-3)11 and questioned Mr. Demery on whether statements of the Court therein were still accurate statements of the English law. Mr. Demery's testimony was not definitive on this aspect.


28The Court allowed the excerpts D-3 to be filed under reserve of Plaintiff's objection as to their relevancy. The Court will deal with this objection further on as Objection No. 2.


29In response to issues raised during cross-examination, Mr. Demery further introduced Judgment P-8 (D-1 in extenso), together with several other judgments (P-9 to P-19) mentioned in the recital of facts D-1, and pleaded in Plaintiff's written reply to Defendant's plea.


30The Court allowed their production under reserve of Defendant's objection which will be dealt with further on as Objection No. 3.


31In responding to questions raised by the Court, Mr. Demery explained that original writs of summons were issued by Plaintiff for the recovery of Equitas premiums from those Names who did not accept the R & R Offer, including Defendant. In her recital of facts, Justice Swinton summarizes the basis of Plaintiff's recovery action:

[...] Those Names who did not accept the R & R Settlement Offer still had their liabilities mandatorily reinsured by Equitas. Lloyd's compelled them to contract with Equitas by imposing upon them a replacement managing agent called "AUA9", which Lloyd's then directed to execute the reinsurance contracts on behalf of the Names. Lloyd's paid all Equitas premiums owing, and the rights to collect the Equitas premiums were then assigned to it. Clause 5.5 of the reinsurance contract provided that each Name was obliged to pay his premium free and clear from any set-off, counterclaim or other deduction, including in respect of claims against Lloyd's. It also provided for a waiver by the Name to any claim to a stay of execution on the judgment12.

 

 

32On the basis that it believed that the Names had no defence to the claim (or to the relevant part of it), Plaintiff then applied, by summonses, to obtain summary judgment against several Names, through the R.S.C. Order 14 proceedings.


33R.S.C. Order 14 provides:

Application by plaintiff for summary judgment (O.14, r.1)

 

 

 1.     (1) Where is an action to which this rule applies a statement of claim has been served on a defendant and that defendant has given notice of intention to defend the action, the plaintiff may, on the ground that that defendant has no defence to a claim included in the writ, or to a particular part of such a claim, or has no defence to such a claim or part except as to the amount of any damages claimed, apply to the Court for judgment against that defendant.

 

 

Manner in which application under rule 1 must be made (O.14, r.2)

 

 

 2.     (1) An application under rule 1 must be made by summons supported by an affidavit verifying the facts on which the claim, or the part of a claim, to which the application relates is based on stating that in the deponent's belief there is no defence to that claim or part, as the case may be, or no defence except as to the amount of any damages claimed.

 

 

Judgment for plaintiff (O.14, r.3)

 

 

 3.     (1) Unless on the hearing of an application under rule 1 either the Court dismisses the application or the defendant satisfies the Court with respect to the claim, or the part of a claim, to which the application relates that there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial of that claim or part, the Court my give such judgment for the plaintiff against that defendant on the claim or part as may be just having regard to the nature of the remedy or relief claimed.

 

 

The Court may by order, and subject to such conditions, if any, as may be just, stay execution of any judgments given against a defendant under this rule until after the trial of any counterclaim made or raised by the defendant in the action.

 

 

Determination of Questions of Law or construction (O.14A, r.1)

 

 

14A/1 1.(1) The Court may upon the application of a party of its own motion determine any question of law or construction of any document arising in any cause or matter at any stage of the proceedings where it appears to the Court that:

 

 

(a)    such question is suitable for determination without a full trial of the actions, and

(b)    such determination will finally determine (subject only to any possible appeal) the entire cause or matter or any claim or issue therein.

 

 

Upon such determination the Court may dismiss the cause or matter or make such order or judgment as it thinks just.

 

 

The Court shall not determine any question under this Order unless the parties have either:

 

 

(a)    had an opportunity of being heard on the question, or

(b)    consented to an order or judgment on such determination13.

 

 

34Because of the considerable number of applications involved, Justice Coleman of the Commercial Court, after hearing counsel for Plaintiff and for the Names, including Defendant, decided to give directions for the management of these cases (P-9).


35Test cases were identified involving three Names, Leighs, Lyon and Wilkinson. Justice Coleman gave leave to non-accepting Canadian Names to intervene in the proceedings on all categories of defences.


36Various grounds of defence raised by the Defendant Names were divided into three broad categories14:

(i)      defences based on the submission that the defendants did not accept the R & R Offer and therefore could not, as a matter of law, be bound by the payment provisions which formed part of it;

(ii)     Plaintiff's title to sue in respect of moneys payable under R & R;

(iii)    defences based on the allegation that the defendants were induced by fraud on the part of Plaintiff to become underwriting names and that Plaintiff could not therefore now recover amounts which would otherwise be due.

 

 

 

 

37Justice Coleman scheduled the hearings in two phases: a first one on categories (i) and (ii) non-fraud defences and a second one for category (iii) fraud defences.


38Prior to the hearing date for the first phase, attorneys for Defendants were directed to file their evidence by way of affidavits, including all matters they wished to raise by way of defences to Plaintiff's claims. Plaintiff was also allowed to respond by way of affidavit.


39In adopting this approach under Order 14 A, the Commercial Court "specifically considered and evaluated a number of alleged defences to see whether they were sound in law and therefore provided an arguable basis for a defence to Plaintiff's claims so as to result in the need for a trial of the various actions between" Plaintiff and the Names15.


40In a 59-page judgment dated February 20, 1997, pursuant to submissions made by all parties during the first phase, Justice Coleman, concluded:

I therefore hold that the defendants have failed to establish that any of the grounds which have been argued before me represent arguable defences or, if these actions were permitted to go to trial, would have any realistic prospect of success. It follows that there will be judgment in declaratory form under Order 14A in the plaintiff's favour on each of the defences. The validity of the other defences to be relied on by the defendants and perhaps the Interveners will have to be considered at a subsequent hearing16.

 

 

41Subsequently, in the second phase of the hearings, category (iii) fraud defences were assessed. There were three issues before the court: the law of rescission of contracts for fraudulent misrepresentation, principles of set-off as between a principal debtor and an assignee, and also stay of execution issues.


42Again, in a 49-page judgment dated April 23, 199717, Justice Coleman analysed the submissions of the parties and concluded that the Defendant Names were not entitled to rescind their contracts of membership with Plaintiff, that, by virtue of the Equitas contract, they were precluded from setting off their counterclaim for damages for fraud against Plaintiff's claim for the Equitas premium and finally, that they were not entitled to a stay of execution of a judgment against them for the Equitas premium. It is important to note that, in analyzing the defences brought forward by Defendants, Justice Coleman assumed the fraud claim to be proven. Therefore, it can be said that he took the Names' positions at their highest18.


43All the arguments put before Justice Colman were again advanced, elaborated and refined before the Court of Appeal (Civil Division). In reasons dated July 31, 1997, the appeal in Society of Lloyd's v. Leighs, Lyon and Wilkinson was dismissed19. Leave to the House of Lords was denied.


44These events are again well summarized in Justice Swinton's recital.

The judgments of Colman J. were upheld by the Court of Appeal in The Society of Lloyd's v. Leighs, Lyon and Wilkinson [1997], N.L.O.R. No. 721 (reasons dated July 31, 1997), and leave to appeal to the House of Lords was refused. Counsel appeared for 215 Canadian Names, who were granted intervener status. The Court upheld the conclusions of Colman J. that the R & R By-law fell within the Society's powers, and the directions given to implement it were validly given; that the Names had not validly rescinded their General Undertakings and thereby avoided their contracts with Equitas concluded on their behalf by AUA9; that the Names were bound by the "no set off" provision in Clause 5.5 of the Equitas contract, given their agreement, at the time that they became Names, to be bound by the legislative and regulatory regime of the Society; and that clause prevented the non-accepting Names from raising claims of fraud against the Society in answer to a claim by the Society as assignee for the Name's premium. Finally, the Court refused to order a stay of execution20.

 

 

45Breaches of overseas securities legislation were also identified before Justice Colman as defences to be raised by non-English Names. This aspect was briefed later on before Justice Tuckey, who rendered judgment on January 27, 1998 in Society of Lloyd's v. Daly21, which was upheld by the Court of Appeal in Society of Lloyd's v. Fraser & Ors22.


46In her recital, Justice Swinton remarks:

Subsequently, Tuckey J. determined that there was no defence to the claim for the premiums based on the allegation that Lloyd's had failed to comply with Ontario securities law (The Society of Lloyd's v. Daly, reasons dated January 27, 1998). In doing so, he gave full effect to a legal opinion of James C. Baillie, Q.C., which had concluded that the actions of Lloyd's had contravened Ontario securities law because of the failure to file a prospectus, and thus, the obligations to Lloyd's would be unenforceable in Ontario. Tuckey J. nevertheless held that the enforcement of the contractual obligations in England was not against public policy, and thus, there was no defence available based on Ontario securities law. Subsequently, in March, 1998, summary judgment was awarded to Lloyd's for the various Equitas premium amounts. Tuckey J. granted a stay of execution until the determination of a leave to appeal application before the Court of Appeal, although he refused to order a general stay of execution.

 

 

Leave to appeal was then sought from the Court of Appeal. In lengthy reasons in Society of Lloyd's v. Fraser & Ors, [1998] E.W.J. No. 1045 the Court of Appeal denied leave to appeal from this judgment of Tuckey J. and others (reasons released July 31, 1998). The Court noted that there was no question here of enforcing a contract that would involve the infringement of an Ontario law, and there was no infringement of comity. The Court noted that if the Canadian Names were correct and their contracts with Lloyd's were void and unenforceable, then so, too, would be the insurance contracts which they had entered, because their contracts' validity depended upon the validity of the underwriting membership with Lloyd's (at 37). Lord Hobhouse concluded that "no principle of comity or public policy would suffice to justify that result". In the course of these reasons, he also stated with respect to the procedure that had been adopted:

 

 

Trials are necessary in order to determine triable issues of fact. It is not the function of the Court on an O.14 hearing to make findings of fact. It is its function to consider whether the affidavits lodged by the defendants in response to the O.14 summons raise triable issues of fact which are capable in law of providing the defendant with a defence to the claim or part of it23.

 

 

 

47Other defences deemed arguable by the Names, relating to quantum and bad faith, were also raised within the Order 14 proceedings. They were resolved in favour of Plaintiff in the course of similar hearings presided by Justice Tuckey, as indicated in Judgments P-13, P-14, P-16 and P-17, all of which were upheld by the Court of Appeal in Society of Lloyd's v. Fraser & Ors24.


48The evidence therefore shows that, after two years of litigation in the English Courts, orders for the issuance of summary judgments were granted and Judgment P-1 became final and enforceable against Defendant.


OBJECTIONS


 

 

Objection No. 1 by Defendant:

filing by

 

 

Mr. Demery of

 

 

excerpts of

 

 

English law as

 

 

pertains to

 

 

Exhibits P-4 and

 

 

P-7.

 

 

49The Court considers that Exhibits P-4 and P-7 may be validly filed by Mr. Demery.


50Firstly, according to Article 2809 C.C.Q., the English law was pleaded by Plaintiff, more particularly in paragraphs 4 and 7.1 of the Amended Originating Motion.


51Secondly, as a practicing solicitor in England for over 25 years, Mr. Demery may testify to prove this legislation25.


52Thirdly, Defendant renounced this argument by soliciting Mr. Demery's testimony on issues of English law comprised in Judgments D-2 (P-10), D-3 and D-4 (P-18).


53Therefore, the Court overrules Defendant's Objection No. 1.


 

 

Objection No. 2 by Plaintiff:

relevancy of the

 

 

English decision

 

 

D-3 filed by

 

 

Defendant.

 

 

54The Court agrees with Plaintiff that Judgment D-3 is irrelevant.


55In paragraphs 32 to 35 of his plea, Defendant contends that the amount for which he was sued was "based on calculation fixed subjectively by or on behalf of Plaintiff and was not substantiated" otherwise than by affidavits and reports submitted by Plaintiff in the O.14 proceedings. In other words, Defendant argues that there was no proper hearing on quantum issues.


56Defendant proposes that the appropriate test is that if the Superior Court of Quebec had condemned Defendant to pay the amount on the basis of the evidence found sufficient by Justice Coleman, this judgment would not have been recognized by the English authority.


57To substantiate this argument, he cites the following excerpt of the Adam's case where, it should be noted, the judgment in question was rendered by default:

When the claim is for unliquidated damages for a tortious wrong, such as personal injury, both our system and the federal system of the United States require, if there is no agreement between the parties, judicial assessment. That means that the extent of the defendant's obligation is to be assessed objectively by the independent judge upon proof by the plaintiff of the relevant facts. Our notions of substantial justice include, in our judgment, the requirement that in such a case the amount of compensation should not be fixed subjectively by or on behalf of the plaintiff26.

 

 

58The same argument was submitted to the Court of Appeal for Ontario in the Saunders case. There, Justice Feldman distinguished the factual context in the Adams case:

[...] the English Court of Appeal refused to enforce judgments of the Texas District Court awarding damages to plaintiffs for injury caused by asbestos dust. The defendant was the supplier of the asbestos. The basis for the English court's ruling was that the Texas court has awarded a global sum for damages for all plaintiffs based on a proposal by plaintiff's counsel, while the amount to go to each plaintiff was to be determined by the plaintiffs' attorneys. The Court of Appeal held that the natural justice required for England to enforce foreign judgments was not limited to due notice and the opportunity to be heard, but included the English court's view of substantial justice. In that case, substantial justice required the Texas District Court judge to determine the quantum of damages for each plaintiff and not to delegate that assessment to the attorneys27.

 

 

59However, Defendant omits this excerpt in Adams which immediately precedes the one he proposes:

The notion of substantial justice must be governed in a particular case by the nature of the proceedings under consideration. The purpose of an in personam monetary judgment is that the power of the state through the process of execution will take the defendant's assets in payment of the judgment. In cases of debt and in many cases of contract the amount due will have been fixed by the acts of the parties and in such cases a default judgment will not be defective for want of judicial assessment.

 

 

(The Court's underlining)

 

 

60The Court disagrees with the views expressed by Defendant in paragraph 35 of his plea. The Equitas claim is not for unliquidated damages for a tortious wrong, but a claim for liquidated sums28.


61Moreover, contrary to what Defendant states, during the judicial process in England, Justice Coleman did give leave to the Names to serve evidence in order to address quantum issues brought forward by Plaintiff29.


62Therefore, the Court maintains Plaintiff's objection concerning the relevancy of Judgment D-3.


 

 

Objection No. 3 by Defendant:

admissibility and

 

 

relevancy of

 

 

Judgments P-8

 

 

and, P-9 to P-19.

 

 

63On the one hand, Defendant argues that, as a matter of procedure, before Judgments P-9 to P-19 can be submitted to this Court, Plaintiff should seek their prior recognition according to Articles 785 and 786 of the C.C.P.


64On the other hand, in paragraph 7 of his plea, he admits that P-1 is the "culmination and result" of a series of test cases managed through the English courts. He submits an excerpt of the Ontario Court of Appeal judgment in the Saunders case as D-1, which describes the factual background to the Lloyd's litigation and summarizes the pertinent English Court decisions, both at the original level and in appeal, resulting in judgments such as Judgment P-1. He further pleads that Judgment D-2 is the foundation of Judgment P-1, which he goes on to file30. He also recognizes in paragraphs 10 and 11 of his plea that he was involved in the test cases as an intervener, which confirms Defendant's knowledge of the entire process. He pleads and files Judgments D-2 (P-10) and D-4 (P-18), without himself seeking their formal recognition.


65The Court finds inconsistency in Defendant's submission on this point.


66The Court cannot ignore Defendant's admissions and the existence of the judgments introduced into proof by Defendant himself, and cannot accept his argument which basically amounts to portraying Judgment P-1 as an isolated event, unrelated to a significant litigation process.


67If, according to Defendant, the lack or reasons in Judgment P-1 does not allow this Court to ascertain whether it conforms to subparagraphs 3 and 5 of Article 3155 C.C.Q., how is the Court to assess Defendant's arguments relating to the contravention of these same provisions, if it cannot take cognizance of the process that occurred?


68As a matter of fact, Defendant does not deny the existence or the authenticity of Judgments P-9 to P-19. Furthermore, the certificate filed as P-2 attests to the outcome of Judgment D-2 (P-10) in appeal.


69Defendant also contends that, by introducing these judgments into proof, Plaintiff is indirectly attempting to remedy the lack of reasons in Judgment P-1. The Court will address this issue further on.


70In the context of this file, the Court finds that there is no obligation either for Plaintiff or for Defendant, for that matter, to request the recognition and enforcement of Judgments P-9 to P-19 pursuant to Articles 785 and 786 C.C.P. for the purpose of demonstrating the factual circumstances in which Judgment P-1 was rendered. The same reasoning applies to Judgment P-8.


71Therefore, the Court overrules Defendant's objection and allows Judgments P-8 to P-19 to be produced into the record as being relevant to the issue at bar.


DECISION


Recognition and Enforcement of a foreign judgment: general principles


72A foreign judgment will be recognized or enforced unless it falls within one of the six exceptions provided in Article 3155 C.C.Q.31


73The Court will not refuse recognition or enforcement on the sole ground that the foreign court applied a law different from the law that would be applicable under the rules dealing with private international law contained in Book Ten of the C.C.Q.32


74It must confine itself to verifying whether the foreign decision meets the requirements of Articles 3155 to 3168 C.C.Q., without entering into any examination of the merits of the decision33.


75In 1994, provisions of the C.C.Q. dealing with recognition and enforcement of foreign judgments were modified to favour the free circulation of decisions:

[...]

 

 

En tenant compte de ces variables, afin d'affirmer le principe de la libre circulation des décisions, l'article 3155 C.c.Q. commence par énoncer que "toute décision rendue hors du Québec est reconnue et, le cas échéant, déclarée exécutoire [...]". Ce n'est que dans des cas limités et biens définis que la reconnaissance ou l'exécution peut être refusée. Pour permettre ce large accueil des décisions étrangères, le Code civil écarte les deux barrages potentiels les plus importants contre les décisions étrangères: la révision au fond et l'exigence que le juge étranger ait appliqué la loi désignée par la règle de conflit du droit québécois34.

 

 

Article 3155 (3): the exception of "contravention of the fundamental principles of procedure"


76In paragraph 20 of his plea, Defendant submits that Judgment P-1 cannot be recognized or enforced because it was rendered in contravention of the fundamental principles of Justice as recognized in Quebec. His proposition is that he was denied the fundamental right to a full and equal hearing for the determination of his rights vis-à-vis Plaintiff. He submits that the appropriate test is whether or not the procedure applied by the English courts offends against the Quebec principles of substantial justice, regardless of whether such procedure is in accordance with the rules of England.


77The fundamental principles of procedure referred to in subparagraph 3 of Article 3155 C.C.Q. are to be construed broadly:

La décision étrangère sera inefficace au Québec aussi dans le cas où elle est rendue en violation des principes essentiels de la procédure (art. 3155, para. 3). Il s'agit de certains principes larges, tel le droit d'être assigné avant son procès ou le droit de faire valoir ses moyens. En revanche, le fait que le juge ou les avocats aient joué un rôle différent dans la procédure étrangère ne constituerait pas une violation d'un principe essentiel de la procédure. Une fraude commise dans la procédure rendrait nulle la décision étrangère35.

 

 

[...] les principes essentiels de la procédure dont parle l'article 3155 C.c.Q., 3e paragraphe, se limitent aux principes très larges d'être assigné avant son procès ainsi que le droit de faire valoir ses moyens36.

 

 

78The English Order 14 proceedings bear some resemblance to motions brought under subparagraph (4) of Article 165 C.C.P and Article 75.1 C.C.P.


79This Court finds no infringement of the audi alteram partem rule, nor does it find that Defendant's fundamental rights protected by Article 23 of the Charter of Human Rights and Freedoms37 (Charter) were disregarded:

Every person has a right to a full and equal, public and fair hearing by an independent and impartial Tribunal, for the determination of his rights and obligations or of the merits of any charge brought against him. [...]

 

 

80As evidenced by the record, Defendant was awarded the opportunity to participate at all levels of the litigation, and his interests were defended by counsel. He was represented in the Commercial Court when directions were set out to shape the Order 14 proceedings, and then all the way through the appellate fora. He was also invited to raise any and all defences and produce evidence upon which he sought to resist the summary judgment order.


81The Court finds that the manner in which Judgment P-1 was rendered does not offend Quebec fundamental principles of procedure.


Absence of reasons in Judgment P-1


82In light of Article 471 C.C.P., does Judgment P-1 offend Quebec fundamental principles of procedure by not being motivated?


83The Court finds it does not.


84As previously outlined, Judgment P-1 results from proceedings instituted by Plaintiff for the recovery of a considerable amount of money and is the culmination, as admitted by Defendant, of several judgments (Judgments P-9 to P-19). The reasons for Judgment P-1 are therefore apparent from the circumstances evidenced in those judgments:

While it is clearly preferable to give reasons and although there may be some cases where reasons may be necessary, by itself, the absence of reasons of a trial judge cannot be a ground for appellate review when the finding is otherwise supportable on the evidence or where the basis of the finding is apparent from the circumstances. The issue is the reasonableness of the finding not an absence or insufficiency of reasons38.

 

 

85Article 471 C.C.P. requires that in civil matters, a judgment be motivated:

[...] l'obligation de motiver repose sur deux fondements principaux. D'une part, le justiciable obtient la garantie que la décision qui affecte ses droits n'est pas arbitraire, mais résulte d'une réflexion dont les raisons sont explicitées dans le jugement. D'autre part, l'obligation de motiver relève des règles de justice naturelle et son non respect permet d'attaquer le jugement par le recours en révision judiciaire ou l'appel, selon le cas39.

 

 

86The circumstances evidenced by Judgments P-9 to P-19 amply provide Defendant the reasons and rationality behind Judgment P-1 and assure him the guaranty against arbitrariness.


87Therefore, the Court dismisses Defendant's argument on this issue.


Article 3155 (5): the exception of public order


88This exception is of limited application. Guthrie J. summarizes its scope in DirecTV inc. v. Scullion40:

At the outset, it should be noted that the public order exception of Article 3155 (5) C.C.Q. is meant to be of limited application and should be narrowly construed by Québec courts. In the Court of Appeal decision in Mutual trust Co. v. St-Cyr, Rousseau-Houle J who wrote the judgment stated:

 

 

"[...] On reconnaissait en général à l'ordre public un rôle particulier en matière de reconnaissance des jugements étrangers au moment de la décision d'exemplification. Il ne s'agissait pas, à ce stade, de porter un jugement sur le contenu de la décision étrangère mais de contrôler si elle pouvait être exécutée telle quelle dans l'ordre juridique de réception. En d'autres termes, on examinait si l'application des lois étrangères, en vertu desquelles la décision avait été rendue, conduisait à une décision acceptable au Québec.

 

 

 

En général, les tribunaux québécois se sont montrés très hésitants à se servir de l'exception d'ordre public pour faire échec à la reconnaissance de jugements étrangers lorsque la solution donnée pouvait s'intégrer harmonieusement dans l'ordre juridique du for41."

 

 

 

89It is the outcome of the foreign decision that must be assessed:

It is only the outcome of the case and not the content of a foreign law which has been applied in the foreign judgment which should justify refusal to recognize, and then only when the outcome is manifestly contrary to the forum's public order, as understood in international relations42.

 

 

 

90Under the circumstances evidenced in this case, it is the Court's opinion that the monetary conclusions of Judgment P-1 are not manifestly inconsistent with public order as understood in international relations.


Conversion to Canadian Dollars


91According to P-7, Judgment P-1 became enforceable on the date it was rendered, March 11, 1998. Article 3161 C.C.Q. allows the conversion of its monetary conclusions into Canadian funds at the rate of exchange prevailing at that date which, according to P-5, was $23.196. Therefore, after the conversion, the awarded claim amounts to $708,138.74.


Interest and Additional indemnity


92Plaintiff's motion requests that the Court award interest at a rate of 8% per annum, as well as the additional indemnity of Article 1619 C.C.Q., "from and after March 11, 1998".


93The second paragraph of Article 3161 C.C.Q. provides that:

[...] The determination of interest payable under a foreign decision is governed by the law of the authority that rendered the decision until its conversion.

 

 

94According to P-4, the applicable interest rate in England when Judgment P-1 was rendered was 8%. Therefore, this rate of interest is payable between March 11, 1998 and the date hereof.


95Thereafter, legal interest and the special indemnity of Article 1619 C.C.Q. applicable in Quebec will prevail.


Provisional Execution


96Plaintiff also requests provisional execution notwithstanding appeal. The Court will not grant this conclusion, as the matters listed in Article 547 C.C.P. are not involved here and because there does not appear to be "exceptional urgency" or " any other reason deemed sufficient" to do so.


FOR THESE REASONS, THE COURT:


97MAINTAINS Plaintiff's Motion;


98RECOGNIZES and DECLARES ENFORCEABLE the judgment rendered on March 11, 1998, in Court record number 1996 Folio number 2412 by the High Court of Justice, Queen's Bench Division, Commercial Court, in the City of London, England, against Defendant, Seymour Alper;


99CONDEMNS defendant, Seymour Alper, to pay to Plaintiff, Society of Lloyd's, the amount of $708,138.74 CDN ($305,284.85), with interest at the rate of 8% per annum from March 11, 1998 to the date of the present judgment and, thereafter, with interest at the legal rate, along with the indemnity provided for by Article 1619 of the Civil Code of Quebec;


100THE WHOLE with costs.


SYLVIE DEVITO, J.S.C.

1 According to rate of exchange on March 11, 1998.

2 [2000] O.J. No. 692; Mr. Saunders, along with Messrs. Meinzer, Smart and Stringer, and Mrs. Montfort, were all Canadian "Names" from Ontario involved in the Lloyd's litigation.

3 [2001] 148 O.A.C. 362; there was an admission to the filing of Justice Swinton's recital facts excerpted from the Ontario Court of Appeal decision; both parties introduced it respectively as D-1 (excerpted) and P-8 (in extenso).

4 Paragraph 7 of Defendant's plea.

5 Paragraph 10 of Defendant's plea; D-2 further filed as P-10.

6 Judgment of July 31, 1997 of the Court of Appeal (Civil Division), London, England in the cases of Society's of Lloyd's v. Lyon, The Society of Lloyd's v. Leighs, Society of Lloyd's v. Wilkinson, also filed as P-12.

7 Judgments further filed as P-9 to P-19.

8 R.S.Q. c. C-12.

9 Article 3161 C.C.Q.

10 Further filed in extenso as P-18.

11 [1991] 1 All E.R. 929, pages 1 to 4 and page 80.

12 Supra, note 4.

13 Included in schedule to Judgment P-8.

14 D-2 (P-10).

15 D-4 (P-18), page 23.

16 D-2 (P-10), page 59.

17 Judgment P-11.

18 As a matter of fact, Names did raise claims of fraud in separate proceedings in the case of Jaffray & Ors v. Society of Lloyd's the outcome of which was decided on its merits firstly by Justice Cresswell in a 635-page judgment released on November 3, 2000, after 64 days of trial. This judgment was upheld by the Court of Appeal in a 589-paragraph decision rendered on July 26, 2002. Justice Cresswell's findings were confirmed as it was decided that Plaintiff was not liable to the Names in the tort of deceit.

19 Judgment P-12.

20 Supra, note 3.

21 Judgment P-15.

22 Judgment D-4 (P-18).

23 Supra, note 3.

24 Judgment D-4 (P-18).

25 Jean-Claude ROYER, La preuve civile, 2e éd., Cowansville, Éditions Yvon Blais, 1995, p. 65, par. 119.

26 D-3, page 80.

27 Supra, note 4.

28 D-4 (P-18), page 24.

29 P-14, page 4 in fine.

30 D-2 (P-10).

31 H.P. GLENN, Droit international privé, La réforme du Code civil, t. 3, Sainte-Foy, P.U.L., 1993, p. 762.

32 Article 3157 C.C.Q.

33 Article 3158 C.C.Q.

34 Gérald GOLDSTEIN, Ethel GROFFIER, Droit international privé : théorie générale, t. 1, Cowansville, Éditions Yvon Blais, 1998, p. 379, 380.

35 Supra, note 27.

36 Canfield Technologies Inc. v. Servi-Metals Canada Inc., [1999] J.Q. no 4248, J.E. 99-1817.

37 R.S.Q., c. C-12.

38 The Queen v. Barrett, [1995] 1 R.C.S. 752; the principles and guidelines set out in Barrett apply to civil matters as well: Municipalité de Grande-Île v. Le Groupe Bau-Val Inc., [2000] J.Q. no 1930, REJB 2000-18768 (C.A.).

39 Denis FERLAND, Benoît EMERY, Précis de procédure civile du Québec, Vol. 1, 4e éd., Cowansville, Éditions Yvon Blais, 2003, p. 709.

40 [2002] R.J.Q. 2086.

41 [1996] R.D.J. 623 (C.A.).

42 Glenn H. Patrick, "Recognition of foreign judgments in Quebec", (1997) 28 Can. Bus. L.J., p. 404.

 


End of Document