Society of Lloyds v. McNeill

2003 CarswellPEI 121, 2003 PESCTD 88, 233 Nfld. & P.E.I.R. 37, 693 A.P.R. 37

Society of Lloyd's v. McNeill

In the Matter of the Canada-United Kingdom Judgments Recognition Act,R.S.P.E.I. 1988, Cap. C-1

And In the Matter of an Application to Register a Judgment of the English HighCourt of Justice, Queens Bench Division, Commercial Court

The Society of Lloyd's (Applicant) and Hubert Bernard McNeill (Respondent)

Prince Edward Island Trial Division [In Chambers]

Jenkins J.

November 7, 2003

Heard: September 2, 2003 Judgment: November 7, 2003Docket: S-1-GS-19948

Proceedings: additional reasons to (2003), [2003] P.E.I.J. No. 97, 2003 CarswellPEI 103, 230 Nfld. & P.E.I.R. 54, 682 A.P.R. 54, 2003 PESCTD 76 (P.E.I. S.C. [In Chambers])

Counsel: Kevin J. Kiley for Applicant

Robert B. McNeill for Respondent

Subject: International; Civil Practice and Procedure

Conflict of laws --- Enforcement of foreign judgments -- Reciprocal enforcement of judgments legislation -- General principles

Foreign judgment creditor brought application to register United Kingdom judgment in Prince Edward Island -- Application was granted and judgment was registered -- Judgment was properly expressed in United Kingdom pounds as of effective date of judgment, converted into Canadian dollars at time of payment -- Pursuant to Art. VII of Canada-United Kingdom Judgments Recognition Act, all matters concerning conversion of sums payable under registered judgment into currency of registering court shall be determined by law of registering court -- Pursuant to s. 46(1) of Supreme Court Act, order enforcing foreign-currency judgment requires payment of Canadian dollars sufficient to purchase amount of foreign judgment at chartered bank on first day prior to payment of judgment -- No exception to operation of s. 46(1) existed in present case so judgment was properly expressed in United Kingdom pounds and dollar equivalency determined later.

Civil practice and procedure --- Judgments and orders -- Time when effective -- General principles

Foreign judgment creditor brought application to register United Kingdom judgment in Prince Edward Island -- Application was granted and judgment was registered -- Calculation of currency conversion rate and interest required disposition on effective date of registration of judgment -- Effective date of order registering judgment was date on which it was made -- Section 51(1) of Supreme Court Act states post-judgment interest is properly calculated from effective date of order -- Pursuant to R. 59.01 of Prince Edward Island Rules of Court, orders are effective on date on which they are made -- By operation of R. 1.03(v) of Rules of Civil Procedure, "order" for purpose of R. 59.01 includes judgment.

Civil practice and procedure --- Judgments and orders -- Currency in which judgment to be paid

Conflict of laws --- Enforcement of foreign judgments -- Practice and procedure in actions on foreign judgments

Foreign judgment creditor brought application to register United Kingdom judgment in Prince Edward Island -- Application was granted and judgment was registered -- Creditor produced bill of costs in amount of $4,339 all inclusive for assessment on partial indemnity scale -- Time spent on file as claimed was not unreasonable -- Some downward adjustment was appropriate to accomplish reasonable connection to amount reasonably contemplated by parties -- Preferable approach to adjustment was reduction in hours spent on early preparation -- Creditor was entitled to certificate in amount of $3,150 all inclusive.

Statutes considered:

Canada-United Kingdom Judgments Recognition Act, R.S.P.E.I. 1988, c. C-1

Sched., Pt. IV, Article VII -- considered

Supreme Court Act, R.S.P.E.I. 1988, c. S-10

s. 46(1) -- considered

s. 46(3) -- considered

s. 46(4) -- considered

s. 51(1) -- considered

Rules considered:

Rules of Civil Procedure, P.E.I. Rules

Generally -- referred to

R. 1.03(v) "order" -- considered

R. 57.01 -- referred to

R. 59.01 -- considered

R. 59.05(1) -- referred to

Rules of the Supreme Court, 1965, S.I. 1965, No. 1776

Generally -- referred to

ADDITIONAL REASONS in respect of currency conversion, currency conversion date and costs to judgment reported at Society of Lloyd's v. McNeill (2003), 230 Nfld. & P.E.I.R. 54, 682 A.P.R. 54, 2003 PESCTD 76, 2003 CarswellPEI 103 (P.E.I. S.C. [In Chambers]), granting application to register foreign judgment.

Jenkins J.:

1 In Society of Lloyd's v. McNeill, [2003] P.E.I.J. No. 97 (P.E.S.C.T.D.), I decided that Lloyd's is entitled to an Order for registration of its English judgment including post-judgment interest as claimed against Dr. McNeill. That judgment was dated and delivered to the parties on September 24, 2003, and filed in the Court Registry on September 25, 2003. Judgment included costs of the application to the Applicant on a "partial indemnity" i.e. party and party-like basis. Counsel were requested to address costs forthwith so that judgment could be registered within September 2003.

2 Counsel for the Applicant made his submission for costs on October 21. Counsel for the Respondent submitted his reply on October 23, and he made his supplementary submission on October 27. As a result, on November 4, counsel for the Applicant made a further submission regarding the applicable conversion rate. The submissions together raised issues regarding which my disposition should be recorded.

• effective date

3 Both counsel refer to the date when my decision was rendered as the operative date. I agree. Rule 59.01 of the Prince Edward Island Rules of Court states that an order is effective from the date on which it is made, unless it provides otherwise. Rule 1.03(v) states that an order includes a judgment. The application of Rule 59.01 appears uncontentious in this jurisdiction, there being no reported cases interpreting Rule 59.01 in the Prince Edward Island Rules of Court or in Watson and McGowan, Ontario Civil Procedure 2004, (Thomson: Toronto, 2003) at 1096. This interpretation is consistent with the historical English application and the current application in other Canadian jurisdictions: See Williston and Rolls, The Law of Civil Procedure, Volume 2, (Butterworths: Toronto, 1970) at 1051 - 1053; Stevenson and Côté, Civil Procedure Guide, Volume 1, (Juriliber: Edmonton, 1992) at 873, 874; Civil Procedure - The White Book Service 2003, Volume 1, (Sweet & Maxwell: London, 2003) at 929.

4 The practice in this jurisdiction appears to vary from the English practice in one respect. Civil Procedure, supra, at page 929 advises that where the English practice of making a reserved judgment available to parties in advance of its delivery is followed, at that time the judgment is not being "given or made" within the meaning of the English Rules, rather it is considered to be a draft judgment. In Prince Edward Island, judgment is considered to be given, or rendered, or pronounced, when a written judgment is delivered to the parties. The practice in this jurisdiction is that a judgment once dated, signed, and delivered to the parties is final; it is filed by the judge in the court registry and published to the world 24 hours later. The one day delay is confined to registration. The protocol is provided for by Practice Note 25. It gives counsel and the parties an opportunity to privately receive and digest the judgment, where applicable to consider their public response, and in exceptional circumstances for counsel to together communicate with the judge regarding an error or oversight from an accidental slip, omission, misstatement, or clerical error. The rendered judgment is not a draft; any consequent correction would occur according to appropriate process, and the correction would appear on the file in the court registry.

5 The issue in the present case was the enforcement of post-judgment interest on a foreign judgment. The pertinent statutory provision is consistent with the rule regarding effective date of the judgment. Section 51(1) of the Supreme Court Act, R.S.P.E.I. 1988, Cap. S-10, states that post-judgment interest is calculated from the date of the order i.e. from the date of the judgment.

• the applicable conversion rate

6 The applicable conversion rate has a significant effect on the amount of the judgment. The conversion rate on July 10, 2003 was 2.3057%. The conversion rate on September 24, 2003 was 2.1984%. The Application contained a draft order, which included a Schedule B "Statement of interest, credits, and conversion of UK judgment to Canadian dollars." In my judgment, I stated at paragraph 12 that the draft order was in proper form subject only to entry of the final interest calculation to the date of registration and addition of costs of the motion, once assessed. Applicant's counsel proceeded forward on that basis. The conversion rate was stated in Schedule B to have been based on the Applicant's evidence of the foreign exchange rate in effect on the date of July 10, 2003. I did not take notice of that date, or realize or recognize that the foreign exchange rate changed from the date used in the evidence to the date of judgment. Nor did either counsel. In my assessment, this amounts to an error arising from an accidental slip or omission, such that the judgment can and should be amended under Rule 59.05(1). Should an application date for conversion be required, it would be the conversion rate in effect at the point in time when the judgment becomes effective. I understand both counsel agree with this assessment and procedure. September 24, 2003 would be the applicable date and rate.

7 Counsel for the Applicant has since pointed out, and counsel for the Respondent agrees, that the applicable legislative provisions direct that the judgment be expressed in British pounds and the applicable conversion rate be determined later at the time of payment. The Canada and United Kingdom Reciprocal Recognition and Enforcement of Judgments Act, R.S.P.E.I. 1988, Cap. C-1, Article VII stipulates that all matters concerning the conversion of the sum payable under a registered judgment into the currency of the registering court shall be determined by the law of the registering court.

8 Section 46 of the Supreme Court Act, R.S.P.E.I. 1988, Cap. S-10, states:

(1) Subject to subsections (3) and (4), where a person obtains an order to enforce an obligation in a foreign currency, the order shall require payment of an amount in Canadian currency sufficient to purchase the amount of the obligation in the foreign currency at a chartered bank in Prince Edward Island at the close of business on the first day on which the bank quotes a Canadian dollar rate for purchase of the foreign currency before the day payment of the obligation is received by the creditor.

. . .

(3) Subject to subsection (4), where, in a proceeding to enforce an obligation in a foreign currency, the court is satisfied that conversion of the amount of the obligation to Canadian currency as provided in subsection (1) would be inequitable to any party, the order may require payment of an amount in Canadian currency sufficient to purchase the amount of the obligation in the foreign currency at a chartered bank in Prince Edward Island on such other day as the court considers equitable in the circumstances.

(4) Where an obligation enforceable in Prince Edward Island provides for a manner of conversion to Canadian currency of an amount in a foreign currency, the court shall give effect to the manner of conversion in the obligation.

9 Counsel advise that there is no manner of conversion on registration stated in the contract between the parties, and that both parties consider s. 46(1) applicable. The order for judgment will stipulate accordingly.

• assessment of costs

10 The Prince Edward Island Rules of Court were amended regarding costs this summer. The rules now provide, as the memorandum from the Chief Justice of the Province and Chair of the Rules Committee states, costs will now be awarded on a "partial-indemnity" or a "substantial indemnity" basis instead of "party and party" or "solicitor-client" basis. The rules and memorandum direct that the amendments are effective on September 1, 2003. Counsel for the Respondent submits that since the hearing was held on September 2, nearly all of the costs were incurred before September 1. He relies on a general rule of statutory construction that statute and regulations are not retroactive unless retroactivity is specifically mentioned for the period. Not surprisingly, the tariff of hourly rates is a little higher under the amended rule than the old rule. Based on the Chief Justice's memorandum, I believe it is expected that the amended rule will apply to all assessments after September 1. On the other hand, I do not disagree with either the legal or equitable basis for the submissions of counsel for the Respondent.

11 The Respondent's counsel also submits that the costs claimed by the Applicant seem "a bit excessive," and he cites particular time recordings that suggest a lot of study and preparation time in relation to the task involved.

12 At this early stage of application of the amended rule, I would refer to costs on a partial-indemnity basis as being party and party-like. Under the new rules, a judge assessing costs will consider the Bill of Costs filed by counsel, including the statement of time expended; although it is not contemplated that this is intended to become an intense arithmetic or accounting exercise. A judge will also consider the reasonable expectation of the parties, and the ususal factors considered under Rule 57.01.

13 In the present case, the proceeding was an application, the issue was narrow, the subject matter was unusual but not novel, the matter was important and the money involved was significant. I am satisfied that counsel for the Applicant did indeed spend the time stated in the Bill of Costs, and that it may be within my discretion to award the amount claimed of $4,339. However, in my assessment there should be some downward adjustment to accomplish a reasonable connection to an amount that would have been reasonably contemplated. Upon taking into consideration all of the factors mentioned, I perceive the preferable approach to be to reduce the allowed time during the early preparation stages, reflect on the hourly rates allowed under the old rules, and consider the confined scope of the issue and the expectations of the parties. As a result, costs of the Application are assessed in the sum of $3,150, all inclusive, of fees, disbursements and applicable taxes.

Order accordingly.