Society of Lloyd's v. Saunders,

Soc. of Lloyd's v. Saunders (2001), 148 O.A.C. 362 (CA)

MLB headnote and full text

Temp. Cite: [2001] O.A.C. TBEd. AU.033

The Society of Lloyd's (applicant/respondent in appeal) v. Gerhard Emil Meinzer, also known as G.E. Meinzer (respondent/appellant in appeal)

(C34005)

The Society of Lloyd's (applicant/respondent in appeal) v. Paul F. Saunders, also known as P.F. Saunders (respondent/appellant in appeal)

(C34006)

The Society of Lloyd's (applicant/respondent in appeal) v. Allan Milton Paul Smart, also known as A.M.P. Smart (respondent/appellant in appeal)

(C34007)

The Society of Lloyd's (applicant/respondent in appeal) v. Donald Elmer Stringer, also known as D.E. Stringer (respondent/appellant in appeal)

(C34008)

Indexed As: Society of Lloyd's v. Saunders

Ontario Court of Appeal

Laskin, Goudge and Feldman, JJ.A.

August 29, 2001.

Summary:

Lloyd's obtained final judgments in England against "Names", individuals who contracted to underwrite insurance through Lloyd's syndicates. The judgments represented each "Name's" share of Lloyd's losses respecting asbestos claims. Lloyd's commenced five "test case" applications under the Ontario Reciprocal Enforcement of Judgments (U.K.) Act to register the judgments in Ontario against 88 "Names". Article 4(1) of the Convention Between Canada and the United Kingdom for the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters (attached to the Act as a Schedule) provided that registration was to be refused or set aside if the judgment had been satisfied or enforcement of the judgment would be contrary to public policy in Ontario. The "Names" opposed registration on the grounds of (1) satisfaction of the judgments in whole or in part; (2) natural justice (lack of opportunity to litigate allegations of fraud against Lloyd's in the U.K. to date); and (3) public policy (Lloyd's breached the prospectus requirements of the Ontario Securities Act).

The Ontario Superior Court, in a judgment reported [2000] O.T.C. 168, allowed the applications and ordered registration of the judgments. Natural justice, although not specifically mentioned in art. 4(1), was an aspect of public policy. Natural justice, as a defence to registration, related to the procedure of the foreign proceedings, not the merits (i.e., applied generally to lack of notice or opportunity to be heard). Enforcement of the judgment was not contrary to natural justice. English courts, already determined to be the proper forum, had already held that even assuming the "Names" could establish fraud, that would not be a defence to their contractual liability to Lloyd's. The fact that the "Names" would be required to pay now and sue for fraud later was not a sufficient basis to deny enforcement of the judgments. Assuming that Lloyd's failure to file a prospectus contravened the Ontario Securities Act, weighing the competing public policies of protecting investors and respect for decisions of a foreign judicial system in the interest in international comity, enforcement of the judgments would not be contrary to public policy. The "Names" appealed.

The Ontario Court of Appeal dismissed the appeals.

Conflict of Laws - Topic 8

General - Doctrine of comity - [See Practice - Topic 5927 ].

Practice - Topic 5927

Judgments and orders - Enforcement of foreign judgments - Bars - Public policy - Lloyd's obtained final judgments in England against "Names" (individuals who contracted to underwrite insurance through Lloyd's syndicates) - Lloyd's applied under the Ontario Reciprocal Enforcement of Judgments (U.K.) Act to register the judgments in Ontario against 88 "Names" - Article 4(1) of the Convention Between Canada and the United Kingdom for the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters (attached to the Act as a Schedule) provided that registration was to be refused or set aside if the judgment had been satisfied or enforcement of the judgment would be contrary to public policy in Ontario - The "Names" opposed registration on the grounds of (1) satisfaction of the judgments in whole or in part; (2) natural justice (lack of opportunity to litigate allegations of fraud against Lloyd's in the U.K. to date); and (3) public policy (Lloyd's breached the prospectus requirements of the Ontario Securities Act) - The trial judge ordered registration - Natural justice, although not specifically mentioned in art. 4(1), was an aspect of public policy - Natural justice, as a defence to registration, related to the procedure of the foreign proceedings, not the merits (i.e., applied generally to lack of notice or opportunity to be heard) - Enforcement of the judgment was not contrary to natural justice - English courts, already determined to be the proper forum, had already held that even assuming the "Names" could establish fraud, that would not be a defence to their contractual liability to Lloyd's - The fact that the "Names" would be required to pay now and sue for fraud later was not a sufficient basis to deny enforcement of the judgments - Assuming that Lloyd's failure to file a prospectus contravened the Ontario Securities Act, weighing the competing public policies of protecting investors and respect for decisions of a foreign judicial system in the interest in international comity, enforcement of the judgments would not be contrary to public policy - The Ontario Court of Appeal agreed.

Practice - Topic 5928

Judgments and orders - Enforcement of foreign judgments - Defences - [See Practice - Topic 5927 ].

Practice - Topic 5934

Judgments and orders - Enforcement of foreign judgments - Registration or enforcement - Defences - [See Practice - Topic 5927 ].

Cases Noticed:

Society of Lloyd's v. Jaffrey, [2000] E.W.J. No. 5731 (Q.B.), refd to. [para. 1, footnote 1].

Four Embarcadero Centre Venture v. Kalen (1988), 65 O.R.(2d) 551 (H.C.), refd to. [para. 13].

United States of America v. Ivey et al. (1995), 26 O.R.(3d) 533 (Gen. Div.), affd. (1996), 93 O.A.C. 152; 30 O.R.(3d) 370 (C.A.), refd to. [para. 21].

Adams v. Cape Industries plc, [1991] 1 All E.R. 929 (C.A.), refd to. [para. 26].

Boardwalk Regency Corp. v. Maalouf (1992), 51 O.A.C. 64; 6 O.R.(3d) 737 (C.A.), refd to. [para. 48].

Fender v. St. John-Mildmay, [1938] A.C. 1 (H.L.), refd to. [para. 50].

Sigurdson v. Farrow (1981), 121 D.L.R.(3d) 183 (Alta. Q.B.), refd to. [para. 54].

Canadian Acceptance Corp. v. Matte (1957), 9 D.L.R.(2d) 304 (Sask. C.A.), refd to. [para. 55].

National Surety Co. v. Larsen, [1929] 4 D.L.R. 918 (B.C.C.A.), refd to. [para. 55].

Block Brothers Realty Ltd. v. Mollard (1981), 122 D.L.R.(3d) 323 (B.C.C.A.), refd to. [para. 56].

Kidron v. Grean (1996), 48 O.R.(3d) 775 (Gen. Div.), refd to. [para. 57].

Andrews et al. v. Grand & Toy (Alberta) Ltd. et al., [1978] 2 S.C.R. 229; 19 N.R. 50; 8 A.R. 182, refd to. [para. 57, footnote 3].

Thornton v. Board of School Trustees of School District No. 57 (Prince George) et al., [1978] 2 S.C.R. 267; 19 N.R. 552, refd to. [para. 57, footnote 3].

Teno et al. v. Arnold et al., [1978] 2 S.C.R. 287; 19 N.R. 1, refd to. [para. 57, footnote 3].

Old North State Brewing Co. v. Newlands Services Inc. (1998), 23 C.P.C.(4th) 217; 41 B.L.R.(2d) 191 (B.C.C.A.), refd to. [para. 58].

Morguard Investments Ltd. et al. v. De Savoye, [1990] 3 S.C.R. 1077; 122 N.R. 81, refd to. [para. 60].

Tolofson v. Jensen and Tolofson, [1994] 3 S.C.R. 1022; 175 N.R. 161; 77 O.A.C. 81; 51 B.C.A.C. 241; 84 W.A.C. 241, refd to. [para. 60].

Beals v. Saldanha et al. (2001), 148 O.A.C. 1 (C.A.), refd to. [para. 60, footnote 4].

Asbestos Corp., Société Nationale de l'Amiante and Quebec, Re (1992), 58 O.A.C. 277; 10 O.R.(3d) 577 (C.A.), refd to. [para. 62].

Jones v. Hodgson (F.H. Deacon) Inc. (1986), 56 O.R.(2d) 540 (H.C.), refd to. [para. 63].

Bonny v. Society of Lloyd's (1993), 3 F.3d 156 (7th Cir.), refd to. [para. 64, footnote 5].

Roby v. Corp. of Lloyd's (1993), 996 F.2d 1353 (2nd Cir.), refd to. [para. 64, footnote 5].

Allen v. Lloyd's of London (1996), 94 F.3d 923 (4th Cir.), refd to. [para. 64, footnote 5].

Haynsworth v. The Corporation (1997), 121 F.3d 956 (5th Cir.), refd to. [para. 64, footnote 5].

Richards v. Lloyd's of London (1998), 135 F.3d 1289 (9th Cir.), refd to. [para. 64, footnote 5].

Sidmay Ltd. v. Wehttam Investments Ltd. (1967), 61 D.L.R.(2d) 358 (Ont. C.A.), refd to. [para. 67, footnote 6].

Royal Bank of Canada v. Grobman (1977), 83 D.L.R.(3d) 415 (Ont. H.C.), refd to. [para. 67, footnote 6].

Ash et al. v. Lloyd's Corp. et al. (1991), 6 O.R.(3d) 235 (Gen. Div.), apprvd. (1992), 60 O.A.C. 241; 9 O.R.(3d) 755 (C.A.), refd to. [para. 72].

Riley v. Kingsley Underwriting Agencies (1992), 969 F2d 953 (10th Cir.), refd to. [para. 82].

Lipcon v. Lloyd's, [1998] CA11-QL 402 (11th Cir.), refd to. [para. 82].

Morrison v. Society of Lloyd's (2000), 224 N.B.R.(2d) 1; 574 A.P.R. 1 (C.A.), refd to. [para. 83].

Crockett v. Society of Lloyd's (2000), 189 Nfld. & P.E.I.R. 129; 571 A.P.R. 129 (P.E.I.T.D.), refd to. [para. 83].

Ship Bremen v. Zapata Off-Shore Co. (1972), 407 U.S. 1, refd to. [para. 84].

Asbestos Corp., Société Nationale de l'Amiante and Quebec (Province), Re (2001), 269 N.R. 311; 146 O.A.C. 201 (S.C.C.), refd to. [para. 85].

Hunt v. Lac d'Amiante du Québec ltée et al., [1993] 4 S.C.R. 289; 161 N.R. 81; 37 B.C.A.C. 161; 60 W.A.C. 161, refd to. [para. 86].

Statutes Noticed:

Convention Between Canada and the United Kingdom for the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters - See Reciprocal Enforcement of Judgments (U.K.) Act.

Reciprocal Enforcement of Judgments (U.K.) Act, R.S.O. 1990, c. R-6, sect. 53(1) [para. 43]; Schedule, art. 4(1)(a), art. 4(1)(e), art. 4(3) [para. 3].

Authors and Works Noticed:

Castel, J.-G., Canadian Conflict of Laws (4th Ed. 1997), pp. 171, 172 [para. 49]; 287, 288 [para. 21].

Dicey and Morris, The Conflict of Laws (9th Ed. 1973), generally [para. 54].

United Nations, Report of the United Nations Commission on International Trade Law (October 4, 1986), Canada Gazette, Part 1, vol. 120, No. 40, p. 3 [para. 17].

Counsel:

Alan Lenczner, Q.C., Sheila Block and Glenn Smith, for the appellants;

Harvey Chaiton, Mark Hartman and George Benchetrit, for the respondent.

These appeals were heard on September 11, 2000, before Laskin, Goudge and Feldman, JJ.A., of the Ontario Court of Appeal.

The following judgment of the Court of Appeal was delivered by Feldman, J.A., and released on August 29, 2001.