This is an update on our blog, Recognition of Foreign Judgments – The Ontario Courts will not Recognize Enforcement Orders (a.k.a. “Ricochet Judgments”), regarding the Superior Court decision in H.M.B. Holdings Ltd. v. Attorney General of Antigua and Barbuda, 2021 ONSC 2307 (CanLII). That decision has been appealed up to the Supreme Court of Canada (“SCC”), which has now also rendered its decision.
In dismissing the appeal, the SCC agreed with the application judge, and with the Court of Appeal, that Ontario’s Reciprocal Enforcement of Judgments Act (the “Act”) bars the plaintiff (appellant) from registering a default judgment that it obtained in British Columbia to enforce a judgment granted by the Judicial Committee of the Privy Council.
The SCC advised that the Act only applies to (1) reciprocating jurisdictions, such as British Columbia, and (2) judgments or orders of a court in a civil proceeding where a sum of money is payable. Further, the Act creates seven defences, laid out in section 3, to the recognition of judgments from reciprocating jurisdictions.
The defences that are at issue in this specific case are those under subsections 3(b) and 3(g) of the Act:
- 3. No judgment shall be ordered to be registered under this Act if it is shown to the registering court that, … (b) the judgment debtor, being a person who was neither carrying on business nor ordinarily resident within the jurisdiction of the original court, did not voluntarily appear or otherwise submit during the proceedings to the jurisdiction of that court; or … (g) the judgment debtor would have a good defence if an action were brought on the original judgment.
The SCC held that under subsection 3(b) of the Act, the judgment debtor must establish that (1) “they were not carrying on business or ordinarily resident in the jurisdiction of the original court” and (2) “they did not voluntarily appear or otherwise submit to the original court’s jurisdiction during the proceeding the judgment creditor brought in that court”. Establishing these two factors bars the registration of the judgment/order in Ontario.
The parties agreed that the judgment debtor (defendant/respondent) is not ordinarily resident in British Columbia and did not voluntarily appear or otherwise submit to the British Columbia court’s jurisdiction.
The SCC opined that in order to determine whether a defendant is “carrying on business” in the jurisdiction of the original court, an enquiry must be made into whether the defendant “has some direct or indirect presence in the jurisdiction, accompanied by a degree of business activity that is sustained for a period of time”. This is a question of fact.
The SCC found no error in law in the application judge’s interpretation of subsection 3(b) of the Act and did not find any palpable/overriding error in the application judge’s assessment of whether the judgment debtor was “carrying on business” in British Columbia. On that basis, the SCC did not interfere with the application judge’s decision and refused to consider the application of subsection 3(g) of the Act.
No determination regarding the enforceability of “ricochet judgments” (i.e. enforcement orders) was made. However, in her concurring reasons, Justice Côté (while agreeing with the Chief Justice’s decision) concluded that “a recognition judgment issued in a reciprocating jurisdiction can be registered” under the Act, “provided that all statutory requirements are met”.
At Gilbertson Davis LLP, our lawyers can assist you, your business, company, partnership or corporation in applying to the court for the recognition and enforcement in Ontario of your judgment obtained in another jurisdiction. Gilbertson Davis LLP lawyers have experience in proceedings involving Recognition and Enforcement of Foreign Judgments, Recognition and Enforcement of International Arbitration Awards, Commercial Litigation, Civil Litigation, Business Torts, and Business Litigation matters and can assist you in resolving your legal issues in a timely and cost-effective manner. Our mission is to provide creative, sensible, cost-effective, long-term resolutions to clients. Please contact Gilbertson Davis LLP to schedule a consultation.
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