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JF 0697 SUPERIOR COURT

CANADA

PROVINCE OF QUEBEC

DISTRICT OF

MONTREAL

No:	500-17-015948-030

______________________________________________________________________

IN THE PRESENCE OF

THE HONOURABLE

WILLIAM FRAIBERG, J.S.C.

______________________________________________________________________

THE SOCIETY OF LLYOD'S

Plaintiff

v.

MICHAEL RICHARD MINKOFF

Defendant

______________________________________________________________________

REASONS FOR JUDGMENT RENDERED ORALLY ON FEBRUARY 5, 2004(1)

______________________________________________________________________

Introduction

1. Plaintiff Lloyd's seeks recognition and enforcement of a money judgment against Defendant Minkoff rendered by the United Kingdom High Court of Justice on March 11, 1998.

2. Mr. Minkoff contested and Lloyd's moved to have two paragraphs of his Plea struck. Having succeeded, it then examined him as to his remaining allegations.

3. In the wake of the examination, Lloyd's now moves to have the entire Plea dismissed under art. 75.1 C.C.P. on the ground that it is clearly unfounded.

4. It also moves for dismissal of the Plea pursuant to art. 165(4) C.C.P. on the ground that it is unfounded in law, assuming the facts to be as stated.

Judgment

5. The Court maintains the motion to dismiss founded on art. 165(4) C.C.P. in part, orders Defendant's plea dismissed for all legal purposes with costs, but denies Plaintiff's request to foreclose Defendant from pleading, that being left to the appropriate procedure of certificate of default to plead and inscription ex parte.

6. The Court also maintains the motion to dismiss under art. 75.1 C.C.P. in part, without costs, orders that the plea of Defendant be dismissed for all legal purposes but denies the other conclusions sought for the same reasons as in its dismissal of the motion under art. 165.4 C.C.P. with regard to foreclosure from pleading, and because the subsidiary conclusion asking that paragraph 10 be struck is moot and would not lie in any case since the partial dismissal of a plea is not contemplated by art. 75.1.

Reasons

7. Under art. 3155 C.C.Q., it is imperative that the Quebec Court recognize and, where applicable, declare enforceable, any foreign judgment except in the six cases expressed. These exceptions are limitative. The Defendant, Mr. Minkoff, perhaps invokes only one found in art. 3155(5) C.C.Q., namely, that the outcome of the United Kingdom judgment in favour of Lloyd's, is manifestly inconsistent with public order, as understood in international relations.

8. However, since he expressly claims a contravention of Quebec public policy only, the ground does not suffice, as has already been decided by the Court of Appeal in Mutual Trust Company c. Marc Saint-Cyr, [1996] R.D.J. 623.

9. The other ground of defence that Mr. Minkoff invokes is prescription. He claims that because the United Kingdom judgment was rendered in 1998 and the proceedings to recognize and enforce it were brought only in 2003, they are prescribed.

10. He cannot now claim that the United Kingdom action was prescribed when brought since that would require the Court to examine the merits of the judgment, which it cannot do by virtue of art. 3158 C.C.Q.

11. As for the present proceedings, since he does not plead the law of prescription of the United Kingdom to the extent that it may at all be relevant, it is the law of Quebec which the Court must apply by virtue of art. 2809 C.C.Q.

12. Under art. 2924 C.C.Q., a right resulting from a judgment is prescribed by 10 years if it is not exercised. The Court cannot, with respect, accept Mr. Minkoff's counsel's argument that it is art. 2925 that applies, namely that the proceeding brought here is to enforce a personal right and therefore prescribed by three years. While three-year prescription is the general rule for personal moveable actions, the same article provides that it does not apply if another prescriptive period is established. Another is indeed established in the immediately preceding article.

13. The principle that a Quebec court will apply the same prescriptive period to a foreign judgment as to a local one was already recognized as far back as 1886 in the case of King v Demers, [1886] M.L.R. 2 QB 439, a decision cited by Walter S. Johnson in his work Conflict of Laws, published in 1962. More recent doctrinal authority is to the same effect.

14. Therefore, the two grounds invoked would be unfounded on the face of the record, even if Mr. Minkoff had not been examined.

15. Paragraphs 9, 10, 11 and 12 are the only positive grounds of defence alleged in the Plea.

16. The motions brought today dispose of paragraphs 9 (prescription) and 10 (public policy).

17. Paragraphs 11 (false representations) and 12 (denial of natural justice) have already been struck by the judgment of my colleague, the Honourable Maurice LagacŽ, on the ground of their immateriality. Mr. Minkoff was examined afterwards and again invoked those grounds in his testimony, but he is precluded from reopening the case on the merits under art. 3158 C.C.Q.

18. Even if Mr. Minkoff's complaint in paragraph 12 that he was precluded from claiming set-off against Lloyd's by way of cross-demand were construed as an implicit invocation of art. 3155(3) C.C.Q. (a decision contravening the fundamental principles of procedure), the record shows that he was given full opportunity to contest the merits of Lloyd's action and that he was not impeded from advancing his own claims in a separate action before the U.K. court. Therefore a defence founded upon art. 3155(3) C.C.Q. would not lie even if it had been expressly invoked.

19. The examination of Mr. Minkoff simply confirms that as appears to be the case, there was no substance to his allegations and that he could not possibly implicitly mean something other than what the allegations in question say. He invoked no principle of international public policy that was offended. Indeed, even if it were relevant, he did not even invoke any principle of Quebec public policy that was contravened by the U.K. judgment, as the examination confirmed. Instead he invoked Lloyd's allegedly fraudulent inducement as a ground under the public policy head when in fact it was an attempt to contest the case on the merits.

20. The same may be said of his allegation of jurisdiction shopping by Lloyd's as a contravention of international public policy. No such principle precludes a litigant from selecting, if he can, a jurisdiction that would be most convenient or hospitable to his claim. If Mr. Minkoff intended by his reference to jurisdiction shopping to invoke sub-paragraph 1 of art. 3155 C.C.Q., namely that the U.K. Court had no jurisdiction under the provisions of Title Four of Book Ten of the Civil Code, and specifically under art. 3168, he has not done so, even implicitly, in his Plea.

21. Mr. Minkoff's examination, as far as the Court is concerned, merely confirms what is the case under art. 165.4 C.C.P. In that regard, the Court does not believe that it is too late to invoke grounds of law for the dismissal of the Plea. This can be done at any stage of the proceedings, with a possible effect on costs, but the Court need make no determination in that regard in disposing of the present motions because they are not dispositive of the case as a whole.

22. This then leaves the other provisions of the Plea which have not been expressly dealt with either in the judgment of my colleague Justice LagacŽ or in the present judgment.

23. The Court believes that the remaining allegations do not constitute a plea. They are, in essence, a plea of general denial and merely put Plaintiff to the proof of the facts he alleges and of the law he invokes.

24. Article 172 C.C.P. states that the Defendant may plead by defence any ground of law or fact which shows that the conclusions of the demand cannot be granted in whole or in part. In other words, a valid plea requires the assertion of some ground of law or fact.

25. Mr. Minkoff, as I have already stated, has pleaded his grounds of law or fact only in paragraphs 9, 10, 11 and 12 and these, as far as the Court is concerned, have no valid existence.

26. The other paragraphs of the Plea may be disregarded inasmuch as they do not invoke any ground of law or fact in the specific terms that would be required.

27. Paragraph 13, a general allegation that Plaintiff's proceeding is unfounded in fact and in law, is either merely a clause de style devoid of any substance or a mere conclusion derived from the earlier positive grounds which, as already stated, have no valid existence. The conclusion itself would therefore be unfounded and non-existent.

28. An analogy may also be found in art. 175 C.C.P. to the effect that the declaration by a party that he submits to justice is not equivalent to a contestation of the suit or to an acquiescence in the pretensions of the opposite party.

29. Mr. Minkoff has certainly not acquiesced in the pretensions of Lloyd's here, but it must also be stated that after the deletion of paragraphs 9, 10, 11 and 12, the remaining allegations amounted at most to a declaration of submission to justice.

30. A plea of general denial, in the opinion of this Court, is the equivalent of a declaration of submission to justice, inasmuch as both statements would require the claimant to establish his case. But neither a plea of general denial nor a declaration of submission to justice amounts to a contestation.

31. Therefore, for all of the reasons cited, the Court believes that both motions should be granted as to the conclusions already identified.

__________________________________ WILLIAM FRAIBERG, J.S.C.

DE GRANDPRƒ CHAIT (Me Ronald Stein) Attorneys for Plaintiff

GOLDSTEIN, FLANZ & FISHMAN (Me Inna Nekhim) Attorney for Defendant

Date of hearing:

February 5, 2004

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1. Request for transcription of reasons for judgment received on February 9, 2004.
Reception of the audio cassette on February 11, 2004.
Reasons for judgment transcribed and amended as to form on February 24, 2004.