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CONFLICT OF JURISDICTIONS - Lis pendens - Stay of proceedings

Friday, October 25, 2019 @ 1:01 PM  


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Appeal from a judgment of the Quebec Court of Appeal setting aside a decision that the wife’s divorce proceedings in Quebec should not be stayed. This issue arose in the context of divorce proceedings between the parties in Belgium and in Quebec. The husband filed for divorce in Belgium on August 12, 2014. The wife filed for divorce in Quebec on August 15, 2014. In the same month, the husband applied under art. 3137 of the Civil Code of Québec (C.C.Q.) to stay the ruling on the wife’s proceedings in Quebec. In October 2014, under Belgian law, the husband revoked, in a letter, all the gifts he had given his wife during their marriage. He drew up a non exhaustive list in which those gifts were valued at over $33 million. The Superior Court considered that it would not be possible to recognize in Quebec a decision of a Belgian court based on the provision of Belgium’s Code civil permitting revocation of the gifts, because that provision was discriminatory, and held that the wife’s divorce proceedings in Quebec should not be stayed. The Court of Appeal reversed that judgment, finding that it was premature to conclude that a Belgian decision with respect to the revocation of the gifts could not be recognized in Quebec, and that the trial judge had also made an error concerning the appropriateness of exercising her discretion to order a stay. The Court of Appeal ordered that the wife’s proceedings in Quebec be stayed except for the issue of corollary relief, which had been submitted only to the Quebec authorities.

HELD: Appeal allowed. Under article 3137 C.C.Q., three conditions had to be met before a Quebec court might stay its ruling. First, the action had to have been filed with the foreign forum first. Second, there had to be identity of the parties, facts and subject between the two actions. Third, it had to be possible for the foreign action to result in a decision that would be susceptible of recognition in Quebec. Only the application of this third condition was at issue in this case. The husband discharged his burden of establishing that the eventual decision of the Belgian court could be susceptible of recognition in Quebec. The Superior Court erred on this point by taking an overly demanding approach in light of the actual words of the provision. It was not appropriate for the trial judge to rely solely on an analysis of the discriminatory nature of art. 1096 of the Belgian Code civil in order to conclude that there was a “great” risk that a Belgian court’s decision would not be recognized in Quebec. Given the low degree of proof required of the husband in this respect, it would be premature to hold that it was impossible that the Belgian decision would be recognized in Quebec on the basis that the outcome of that decision would be manifestly inconsistent with public order as understood in international relations. The possibility that the decision could be recognized in Quebec could not be ruled out. This was enough to meet the condition of art. 3137 C.C.Q. In the presence of a situation of international lis pendens, the Court has discretion under art. 3137 C.C.Q. to decide whether it is appropriate to stay proceedings in Quebec. Circumstances giving rise to the international lis pendens exception, including susceptibility of recognition, were not on their own a bar to the discretion conferred by art. 3137 C.C.Q. The trial judge’s analysis was not unreasonable. It was thus not open to the Court of Appeal to substitute its own analysis for hers. Even if the trial judge did make certain errors, nothing in her analysis suggested that those errors tainted the exercise of her discretion in such a way as to make it unreasonable. The wife’s appeal should be granted and the trial judge’s conclusion dismissing the husband’s application for a stay should be restored.

R.S. v. P.R., [2019] S.C.J. No. 49, Supreme Court of Canada, R. Wagner C.J. and R.S. Abella, M.J. Moldaver, A. Karakatsanis, C. Gascon, R. Brown and S.L. Martin JJ., October 25, 2019. Digest No. TLD-October212019013-SCC