CANADA Law and Practice Contributed by: John Pirie, Matthew Latella, David Gadsden and Christina Doria, Baker McKenzie
had “implicitly” overturned the rule in Duke . However, before the Supreme Court of Canada could hear the ultimate appeal, the matter was resolved. Reciprocal Enforcement Certain Canadian provinces have passed reciprocal enforcement of judgment statutes that apply to for - eign judgments. However, the scope of such legisla - tion varies from province to province and tends to be limited to other Canadian provinces, the UK, a few select US states, and parts of Australia. Where a provincial reciprocal enforcement of judg - ments statute applies to foreign judgments, the judg - ment may be enforced by registration. However, the provincial legislation does not alter the conflict of laws rules applicable to the recognition of foreign judgments. As a practical matter, while the legislation should be invoked when applicable, registration alone may not be satisfactory for enforcement purposes. The courts of each province are still required to take a supervisory role to ensure that the foreign judgment is enforceable in accordance with applicable Canadian law. Recently, the Supreme Court of Canada dealt with the application of Ontario’s Reciprocal Enforcement of Judgments Act, RSO 1990 c R.5 (REJA) in conjunction with the availability of “ricochet judgments”, where a creditor asks one province to recognise another prov - ince’s recognition of a foreign judgment ( HMB Hold- ings Ltd v Antigua and Barbuda , 2021 SCC 44). The Supreme Court of Canada affirmed the Ontario Court of Appeal’s refusal of an application for an order under the REJA to register a judgment from the Supreme Court of British Columbia, which had recognised by way of a default judgment a decision of the UK. Under Section 3 (b) of the REJA, judgments cannot be registered if the judgment debtor was not “carry - ing on business” within the jurisdiction of the court whose judgment was to be enforced. Although the REJA does not define what constitutes “carrying on a business”, it is an established common-law concept as part of the traditional bases of establishing jurisdic - tion, which the Supreme Court of Canada found was codified by Section 3 (b) of the REJA.
The Supreme Court of Canada found that “carrying on business” requires an entity’s actual presence in a jurisdiction, in addition to a degree of business activity that is sustained for a period of time. Mere virtual pres - ence, such as through advertisement, is not enough. Actual presence within a jurisdiction could involve maintaining a physical office within or regularly visiting the territory of the jurisdiction and engaging directly with customers. Additionally, an “indirect” actual pres - ence could mean that the physical premises of the entity are operated by an agent or other representa - tive ( Club Resorts v Van Breda , 2012 SCC 17; Wilson v Hull , 1995 ABCA 374). Notably, when the plaintiff later tried to enforce the British Columbia default judgment in Ontario via the common law test, rather than under the REJA, the Ontario courts also rejected such efforts at both the court of first instance and the Ontario Court of Appeal. The appellate court raised concerns that such ricochet enforcement proceedings could be used to circumvent more restrictive limitation periods in the second jurisdiction in which enforcement is sought (Ontario’s limitation period is very different from that of British Columbia). Finding no precedent for the plain - tiff’s efforts at common law, the court concluded that the common law test for the enforcement of original foreign judgments in Canada does not apply to the recognition and enforcement of a ricochet judgment. Treaties Treaties are a third source of law for the recogni - tion and enforcement of foreign judgments. Canada and the UK have entered into the Convention for the Reciprocal Recognition and Enforcement of Judg - ments in Civil and Commercial Matters, ratified as the Canada-United Kingdom Civil and Commercial Judgments Convention Act, RSC 1985, c C-30. The above-referenced Reciprocal Enforcement of Judg - ments (UK) Act adopts this treaty. Canada is not a signatory to the Hague Convention on the Recognition and Enforcement of Foreign Judg - ments in Civil and Commercial Matters. Therefore, Ontario applies Canadian common law when dealing with recognising and enforcing awards from jurisdic - tions other than the common law provinces and the UK. Furthermore, the enforcement treaty between
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