In Shanghai Investment Co. Ltd. V. Lu et al. 2024 ONSC 2762, the Ontario Superior Court of Justice (Commercial List), allowed a foreign arbitral award to be recognised and made enforceable as a partial summary judgment. The Plaintiff, Shanghai Lianyin Investment Co Ltd. (“SLIC”) sought the recognition and enforcement of a CAD $233 million arbitral award rendered under the rules of the China International Economic and Trade Arbitration Committee (“CIETAC”) against the Defendant Zheng Yao Lu (“Lu”) as a threshold matter; and a declaration that the other defendant, Lichun Guo (“Guo”) held her interest in two properties in Ontario on behalf of Lu, and that SLIC could enforce its award against these properties. The court found that the CIETAC award should be recognised and made enforceable as both of the following requirements under Articles IV and V of the New York Convention (incorporated in the International Commercial Arbitration Act, 2017, S.O. 2017, c. … Read More
Jurisdiction and forum non conveniens in the Digital Age – Ontario Court Refuses to Certify Class Action against the United States Largest Cryptocurrency Exchange due to Lack of Jurisdiction
In Shirodkar v Coinbase Global Inc. et al, 2024 ONSC 1399, the Ontario Superior Court of Justice provides a review of jurisdictional challenges and the issue of forum non conveniens involving a cryptocurrency class action. The defendants, Coinbase Global, Inc., along with its affiliated entities (“Coinbase”), faced a class action lawsuit brought by a user of its online trading platform, Mr. Shirodkar, which Coinbase sought to dismiss due to a lack of jurisdiction. Coinbase operates a platform for buying and selling digital assets, including cryptocurrency. Between October 2017 and January 2021, Mr. Shirodkar conducted transactions on the Coinbase platform while residing in France and later in Ontario. His complaint, in the form of a class proceeding, alleged that the crypto assets traded on the Coinbase platform should be classified as “securities” under the Securities Act, R.S.O. 1990, c. S. 5 and that Coinbase failed to abide by the disclosure requirements … Read More
Ontario Court Favours Place of Arbitration over Forum Selection Clause in Asset Purchase Agreement
In Tehama Group Inc v. Pythian Services Inc., 2024 ONSC 1819, the Ontario Superior Court of Justice held that the place of an arbitration, not a forum selection clause in a contract, determines the jurisdiction that recourse against an arbitral award must be taken in. The litigants were parties to a cross-border asset purchase agreement (the “APA”). The APA included an arbitration clause for disputes regarding the calculation of the purchase price, and the parties appointed “the Toronto office” of an accounting firm as arbitrator for these disputes. The APA also included broad forum selection and governing law clauses, which required “any suit, action or other proceeding arising out of this Agreement” to be brought exclusively in the courts of New York and in accordance with its laws. A dispute arose regarding an earnout clause in the APA, and the parties proceeded to arbitration. When the Toronto-based arbitrator rendered an … Read More
Letters of credit and the fraud exception: Supreme Court examines applicability to fraud by a third party
A letter of credit or a bank guarantee is an autonomous instrument that is issued by a financial institution on the directions of a customer. The letter of credit seeks to underwrite the customer’s obligations to the beneficiary under the distinct underlying contract. It entitles the beneficiary to payment on demand from the issuing bank, so long as that demand strictly complies with the requirements set out in the letter of credit. The obligation of the financial institution to pay when presented with a valid demand is near absolute. The only recognized exception in Canadian law is when there is fraud by the beneficiary that is brought to the financial institution’s attention prior to payment. In Eurobank Ergasias S.A. v. Bombardier Inc. 2024 SCC 11 (CanLII), the Supreme Court of Canada examined a critical issue of when an issuing bank is required to refuse to honour a demand for payment … Read More
7 Things to Know About Recognition and Enforcement of Foreign Judgments in Ontario
In the recent decision of the Ontario Superior Court of Justice (“ONSC”), Roger Vanden Berghe NV v. Merinos Carpet Inc., 2023 ONSC 6728, the ONSC provided a helpful guide on some of the key principles applicable to cases involving the recognition and enforcement in Ontario of judgments from other countries. In this case the ONSC granted an application for the recognition and enforcement of a judgment from a court in Belgium; the Ghent Business Court, Kortrijk Division, First Chamber (the “Judgment”). The underlying dispute that was adjudicated in Belgium was with respect to unpaid invoices for textile orders. The respondent did not respond to the proceeding in Belgium, although summoned by a Writ of Summons. The respondent claimed that it was not properly served with the Writ of Summons, and even if it was, one of its representatives would not have been able to attend given the Covid-19 travel restrictions … Read More
Service Abroad in Civil and Commercial Litigation
The Hague Service Convention Since 1989 Canada has been a member of Hague Convention of 15 November 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, (the Hague Service Convention). Incoming Service of Foreign Process We have blogged before about the requirement of the Hague Service Convention that its member States designate a “Central Authority” to accept incoming requests for service. There are alternatives to the Hague Service Convention service of foreign process in Ontario. Service of Ontario Process Abroad As other jurisdictions become, or will become, members of the Hague Service Convention, the Status Table is updated. For instance, see the status of Azerbaijan (November 1, 2023), Singapore (December 1, 2023) and Paraguay (January 1, 2024) on the Status Table. Why Chose Gilbertson Davis LLP? One of the senior commercial litigation lawyers at Gilbertson Davis LLP, though now only practicing in Ontario, has also practiced … Read More
Sabrina Saltmarsh Presents as Part of Panel on Enforcement of Judgments at Cross-Borders Legal Conference
Sabrina Saltmarsh presented as a Panelist at this year’s Cross-Borders legal conference held by the Ontario Bar Association on Enforcement of Judgments. The Panel discussion included: how to obtain an order granting enforcement of letters rogatory in Ontario; how letters rogatory are treated by Canadian banks; the process of obtaining recognition and enforcement of foreign judgements in Ontario; and current legal issues surrounding obtaining these types of orders in Ontario. Sabrina provided insights to the audience of Canadian and American lawyers on the recent developments on the law concerning ricochet judgments and the role experts on foreign law may play in judicial proceedings pertaining to enforcement and recognition proceedings. Lawyers at Gilbertson Davis LLP, have experience in representing parties in cross-border litigation and disputes, including seeking to enforce Letters Rogatory and Enforcement and Recognition of Foreign Judgements in Ontario. Please contact Gilbertson Davis LLP to schedule a free initial consultation.
Court of Appeal Affirms Limitation Period for Recognition and Enforcement of Foreign Judgments
In the recent Court of Appeal decision of Sunlight General Capital LLC v. Effisolar Energy Corporation, 2023 ONCA 133, the Court of Appeal reaffirmed the principles established in Independence Plaza 1 Associates L.L.C. v. Figliolini, 2017 ONCA 44, 136 O.R. (3d) 202, (“Independent Plaza 1”) at para. 3, that the limitation period for the recognition and enforcement of a foreign judgment begins to run from the date on which the right of appeal in respect of that judgment expires, and not from the date of issuance of the judgment. Facts: The Respondent, Sunlight General Capital LLC (the “Respondent”), had obtained a judgment against the Appellant, Effisolar Energy Corporation (the “Appellant”), in the Supreme Court of New York for approximately 1.6 million U.S. The judgment was issued on October 18, 2018, and on May 19, 2019, an appeal with the Supreme Court of New York was administratively dismissed. The Respondent moved … Read More
Recognition of Foreign Judgments and Arbitral Awards – Recent Decision of the Ontario Superior Court of Justice says Ontario Court is Not to Intervene Absent Exceptional Circumstances
The Ontario Superior Court of Justice (“OSCJ”) recently released its decision in Costco Wholesale Corporation v. TicketOps Corporation, 2023 ONSC 573, granting an application to enforce judgments received by the applicant from the United States District Court (Western District of Washington at Seattle) and/or the underlying arbitral awards. At the same time, the OSCJ also rejected the Respondents’ motion to convert the application into an action. Recognition of Awards With regard to the Awards, the OSCJ advises as follows: “In Ontario, foreign arbitral awards are enforceable through the International Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sched. 5 (“ICAA”). The ICAA provides that the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“Convention”) has force of law in Ontario. The Convention is set out in Schedule 1 to the ICAA. The ICAA also provides that the Model Law on International Commercial Arbitration (“Model Law”) has force of law in Ontario. The Model Law is set out in Schedule 2 to the ICAA.” The OSCJ notes that the Convention and … Read More
Recognition of United States and Other Foreign Default Judgments – The Ontario Court Does Not Consider Underlying Merits!
Just over a month ago, the Ontario Superior Court of Justice (“ONSC”) in North Field Technology Ltd. v. Project Investors, Inc., 2022 ONSC 5731, recognized as orders of Ontario a default judgment and various ancillary orders that the Applicant obtained in the United States District Court, Southern District of Florida (“Florida Court”), against the Respondents. The Florida Court found that the Respondents were evading service of the legal proceedings in Florida and issued a series of judgments against the Respondents such as an asset freeze injunction and permanent injunction restraining the Respondents from transferring their assets, as well as orders for certain monetary and declaratory relief, among other orders. The ONSC validated service of the Ontario application, recognizing that the Florida Court “has already found that the respondents were avoiding service”. The ONSC also found that the Applicant has met the test for recognition and enforcement of the Florida Judgments … Read More
Ontario Court Affirms “Generous and Liberal Approach” to the Recognition/Enforcement of Foreign Judgments
In the recent decision, M1 Florida Developments Inc. v. Ameristar Development Corporation, 2021 ONSC 6883 (CanLII), the Ontario Superior Court of Justice (“OSCJ”) granted the plaintiffs default judgment in Ontario for the registration and enforcement of a judgment that the plaintiffs obtained in the United States of America (the “Foreign Judgment”). The OSCJ advised that Canadian courts “have adopted a generous and liberal approach to the recognition and enforcement of foreign judgments”. Further, the OSCJ opined that the purpose of an action for the recognition of a foreign judgment “is to assist in enforcing an already-adjudicated dispute” and is not “to evaluate or re-litigate the underlying claim”. The OSCJ was satisfied that the foreign court “properly assumed jurisdiction over the dispute” and noted that a Canadian court “will generally recognize and enforce a foreign judgment where the foreign court assumed jurisdiction on the same basis as the domestic court would”. … Read More
Recognition of Foreign Judgments – Supreme Court Leaves Determination of Enforceability of “Ricochet Judgments” for another day – Update on Previous Blog
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 … Read More
Recognition of Foreign Judgments – The Ontario Courts will not Recognize Enforcement Orders (a.k.a. “Ricochet Judgments”)
In H.M.B. Holdings Ltd. v. Attorney General of Antigua and Barbuda, 2021 ONSC 2307, on a summary judgment motion, the Ontario Superior Court of Justice (“OSCJ”) found that there was no genuine issue requiring a trial and subsequently dismissed the plaintiff’s action (commenced on May 6, 2019) for the recognition of a money judgment that it obtained against the defendant in British Columbia in 2017 (“BC Judgment”). The BC Judgment was a default judgment recognizing and enforcing a judgment of the Privy Council of the United Kingdom which the plaintiff obtained in 2014 (“Privy Council Judgment”). The defendant argued that: The plaintiff was attempting to avoid seeking recognition and enforcement of the original Privy Council Judgment in Ontario by seeking to recognize and enforce the derivative BC Judgment instead; The plaintiff would be out of time to seek recognition of the Privy Council Judgment in Ontario (because of the expiry … Read More
China International Arbitration Award Enforced by Ontario Court
Tianjin v. Xu, 2019 ONSC 628 (CanLII) involved an application under the International Commercial Arbitration Act, 2017, SO 2017, c 2, Sch 5 (the “Act”) for an order recognizing and making enforceable in Ontario an arbitral award of the Chinese International Economic and Trade Arbitration Commission (“CIETAC”). Respondent’s Defences The respondent argued that the arbitration award should not be enforced in Ontario because: Service: The respondent did not receive notice of the arbitral proceeding or the appointment of arbitrators; and Jurisdiction: The Ontario Superior Court of Justice did not have jurisdiction to enforce the arbitral award because the arbitration was not an “international commercial arbitration”. Service The court found that there is no requirement that service of notice of the arbitral proceedings or of appointment of arbitrators be effected in accordance with the CIETAC Rules. Rather, the court opined that the respondent was given “proper notice” of the proceedings and … Read More
Toronto Lawyers for Large Debt Collection and Enforcement of Foreign and Local Judgments and Awards
Domestic and, US and Other Foreign Debt, Judgments and Awards We are often consulted or retained in connection with recovery of large local debt or foreign debt, including casino debt, or to seek recognition and enforcement in Ontario, Canada, of judgments, orders, or arbitration awards obtained in Ontario, other provinces of Canada, US and other foreign jurisdictions. We are sometimes retained to work with the assistance of lawyers practicing debt recovery in other jurisdictions, including, those located offshore. Claims on Loan Guarantee We can advise and represent those claiming payment on a guarantee, and those named as guarantor of a loan. Loan or Gift? | Loan or Investment? Disputes sometimes arise when either a payment advanced or transfer is alleged to be a loan rather than a gift, or alleged to a loan rather than an investment, or vice-versa. We have relevant experience in both domestic and cross-border litigation. Injunctions and Other … Read More
Legal Consequences of COVID-19 / Coronavirus on Commercial Contracts
Impact of COVID-19 / Coronovirus Events on International and Domestic Commercial Contracts The reports from China show that COVID-19 / Coronavirus not only has a tragic impact on the lives of very many, but has already caused the consequential events of closure of manufacturing, halting exports and affecting transportation operations. This can be caused by forced movement of labour, government-ordered closure and / or state sanction and embargo, or the business decision to cease production. Interruption of Supply, Outsourcing and Transportation of Goods This often has serious consequences for Canadian companies dependent upon foreign supply, outsourcing of manufacturing and the international carriage of goods. The central question is often whether or not the performance of a supply, outsourcing or transportation contract is legally suspended or excused because of the events surrounding the spread of COVID-19 / Coronavirus. Frustration | Impossibility International trade and transportation contracts may not expressly refer to … Read More
Hurdles To Recognition and Enforcement Of Foreign Judgments
In the recent Ontario Court of Appeal decision of H.M.B. Holdings Limited v. Antigua and Barbuda, 2020 ONCA 12, the Court of Appeal rendered a split (2-1) decision regarding the recognition of a foreign judgment which muddies the waters on the analysis to be applied to s.3(b) of the Reciprocal Enforcement of Judgments Act, R.S.O. 1990, c. R.5 (REJA) Original Judgment: In this case H.M.B. Holdings Limited (HMB) was successful in obtaining judgment on February 26, 2014, against Antigua and Barbuda from the Judicial Committee of the Privy Council (the JCPC), which is the highest court of appeal for certain British territories and Commonwealth countries including Antigua and Barbuda. The case related to damages sought by HMB due to the expropriation of resort lands by the Antiguan government. The case has garnered some media attention because of the manner in which the lands were expropriated. HMB then brought a common law … Read More