IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
Civil Jurisdiction
CIVIL
CASE No. 53 of 1999
p EN:
BANK
OF MONTREAL
Plaintiff
AND:
VICTOR M. PRESCOTT & LORRAINE WILMA PRESCOTT
Defendants
Coram: Lunabek Vincent
Acting Chief Justice
Counsel: Mr. Juris
Ozols for the plaintiff
Mr. John Malcolm for the defendants
JUDGMENT
This is an application to enforce a foreign
monetary judgment debt in Vanuatu.
By Consent Orders of 26 April 2000, the
plaintiff/Bank of Montreal was granted leave to amend her motion into a
Summary
Judgment application.
The plaintiff Bank seeks to recover from the
defendants a debt owing at the Value of $11,032,987.34 Canadian, as at March
24, 1999 being for monies owed under a Loan Agreement and Guarantee dated
November 21, 1984 in which judgment was entered
and renewed in the Supreme
Court of British Columbia, Vancouver on the August 12, 1989 and July 21,
1999, with interests
and costs.
The Plaintiff Bank relies on two affidavits
filed in support of the application. The first affidavit dated May 12, 1999
is that of Stanley Julian, an Accountant Manager employed by the
plaintiff/Bank. The second affidavit is that filed by Mr. Geoffrey
Thompson,
Barrister and Solicitor of Vancouver, British Columbia, Canada dated May 19,
2000.
The defendants file no affidavits. I have had
opportunity to read and consider both affidavits and the following facts are
established:
On August 12, 1989, the plaintiff obtained
Judgement against the defendants (the “B.C. Judgment”) and on February
13, 1990
Registrar Dunn of the Supreme Court of British Columbia, certified
the amount owed and payable by the defendants to the plaintiff
under the
B.C. Judgment to be the sum of Canadian Dollars $11,679,113.11, plus cost as
Exhibited in “A”.
All appeals from the B.C. Judgment were
dismissed or abandoned. All appeals from the subsequent orders in respect of
the
Execution proceedings against the defendants were dismissed. The B.C.
Judgment remains in full force and effect.
As at 24 March, 1999, the amount owing under the
B.C. Judgment of the Supreme Court of British Columbia, is an amount of
Canadian Dollars $11,032,987.34 exclusive of the plaintiff’s costs in the
original action.
The defendants are the beneficial owners of real
estate in Vanuatu and have other assets in Vanuatu in respect of which
execution proceedings may be initiated.
The defendants are presently in residence in
Vanuatu at their house in Tassiriki Park, Port Vila, Vanuatu.
As a result of the operation of section 3(3)(f)
of the Limitation Act S.B.C. 1996, c.226, the B.C. Judgment was to expire on
August 2, 1999.
On April 1, 1999, the plaintiff/bank commenced
proceedings in the Supreme Court of British Columbia, Action No. 9052729 to
renew the B.C. Judgment.
On July 12, 1999, the defendants filed a
statement of defence and counter claim against the Bank in Action No.
9052729.
On 21 July, 1999, the Hon. Mr. Justice McKinnon
pronounced an Order renewing the B.C. Judgment and dismissing the counter
claim filed by the defendants. Subsequent to July 21, 1999, the defendants
took the position that they had not properly been
served with the notice of
Motion to renew the B.C. Judgment.
Consequently, rather than argue this point, the
plaintiff/Bank applied to set aside the Order of the Hon. Mr. Justice
McKinnon
and on 3 August, 1999, appeared before the Hon. Mr. Justice E.R.
Edwards and obtained an Order renewing the B.C. Judgment and
dismissing the
counter claim filed by the defendants.
As of May 5, 2000 the amount due and owing by
the defendants to the Bank/plaintiff is Canadian Dollars $11,584,662.92.
Mr. Malcolm raised an opposition on the basis of
Limitation Act No.4 of 1994 (Vanuatu). He submitted as follows:
First, Section 4 of the Limitation Act could
only apply to a judgment given outside Vanuatu if it expressly said so. The
12 years period does not apply. He relied
on the persuasive authority of a
New Zealand case in S.M.C. v. O’Brian CP 325/90 IV2.
Second, actions in Vanuatu on a Foreign Judgment
are treated as an action on a contract and thus have a limitation period of
6 years under Section 3(1) of the Limitation Act. He relied on the cases of:
· ;
sp Berliner Industriebank AG v. JOST
(1971) 2 QB. 463
· &nbbsp;&
sp; CP 325/90 IV2
· &nbbsp;
span>And a passage from Halsbury paras. 658 & 661 (28 Vol.).
/span
lass="MsoBodsoBodyTextyText">Also, it is submitted that there have been no
payments (under Section 11(4) of the Limitation Act) to constitute an
acknowledgement.
Third, the judgment in this case issued on or
about 23 August, 1989 and is statute-barred.
Finally, referring the Court to Order 27 r.3 of
the High Court Rules, he submitted that the writ bases its sole cause of
action as being the judgment and if the claim is statute-barred, it disposes
of the entire claim and the matter ought to be
dismissed.
Mr. Ozols submitted on behalf of the
plaintiff/Bank that the Writ of Summons was issued to recover the debts
against the
defendants.
The evidence is based on two (2) judgments filed
to support the claim. The first judgment was the judgment of the Hon. Mr.
Justice Gibbs pronounced in favour of the Bank against the Prescotts, dated
August 2, 1989, pursuant to their guarantee of
the obligations of FCL to the
Bank (the “B.C. Judgment”). The second judgment was the judgment of the
Hon. Mr. Justice
E.R. Edwards dated 3 August, 1999, renewing the B.C.
Judgment of 2 August, 1989.
It is, therefore, submitted that the
plaintiff/Bank is entitled to 12 years to enforce the judgment of 1989.
However, if
that is not possible, then, the judgment of 1999 can be enforced
under the Vanuatu Limitation Act of 1994. Further, because Vanuatu Supreme
Court has no power to renew its own judgment, then, it is put that the Court
can use its inherent powers to extend its judgments and as such, go beyond
the technicalities of the Limitation Act of 1994 (Vanuatu).
Further it is said that on the basis of the B.C.
Judgment of 1999, the plaintiff is within the period of 6 years as provided
under the Limitation Act. The renewal of the judgment constitutes a new
judgment, and as such, can be enforced under Section 3(1) of the Limitation
Act.
The following are relevant provisions of the
Vanuatu Limitation Act No. of 1994:
The Interpretation Section of the Act says:
“1.(1)
In this Act, unless the context otherwise
requires:-
“action”
includes
any proceedings in a Court of law but does not include any proceedings
brought… in an Island Court established
in accordance with the Island
Courts Act [CAP 167];
“Court”
in
relation to an action, means the Court in which the action has been, or is
intended to be brought, but does not include
an Island Court established in
accordance with the Island Courts Act [CAP 167];”
Section 3(1)(4) of the said Limitation Act
provides:-
“3.(1) The following actions shall not be brought
after the expiration of six years from the date on which the cause of action
accrued, that is to say-
(a) actions founded on simple contract or on tort;
(b) …
(c) actions to enforce an award, where the submission
is not by an instrument under seal;…
(4) An action shall not be brought upon any judgment
after the expiration of twelve years from the date on which the judgment
became enforceable, and no areas of interest in respect of any judgment debt
shall be recovered after the expiration of
six years from the date on which
the interest became due.”
The first legal issue raised in this case is
that of the registration of Foreign Judgments. This is not the first time
that
the Supreme Court of Vanuatu deals with the issue. It has been decided
that foreign writs are not enforceable in Vanuatu since
there is no
reciprocity between Vanuatu and any other country allowing for registration
of Foreign Judgments. [See ACCC
V. Reynolds case No. 146 of
1996; Mackenzie v. Baker (1995) and civil case No. 35 of 1992
judgments of Supreme Court (unreported)].
A foreign plaintiff who obtained a final
judgment against a defendant can follow a defendant in another jurisdiction
in
pursuance of a debt by commencing a de novo action in that country as an
accepted practice of Private International Law.
The second legal issue for consideration is that
the person who seeks to enforce a foreign judgment is required to prove that
it was issued by a competent Court, that it is final and conclusive, that it
is not estopped on grounds of fraud, public
policy, natural justice and
illegality (e.g. a judgment requiring completion of a contract or act
unlawfully in the jurisdiction)
and that it is not statute-barred by
operation of the Limitation Act of the forum in which the issue arises.
In this case, there is no dispute on the
existence of the debts. The judgments obtained by the plaintiff constitute
prima
facie evidence of the existence of the debts. Since all appeals,
default judgments and defence were explored by the defendants
and were
unsuccessful, I am satisfied that the judgements obtained by the plaintiff/
Bank of Montreal are final and conclusive.
The only remaining issue is the effect of the
Vanuatu Limitation Act No. 4 of 1994 on the said Canadian judgment.
The law in relation to limitation is procedural
and as such, it is governed by the law of the forum in which the issue
arises
and in this case, it is the law of Vanuatu. [See the persuasive
authority of S.H.C. v. O’Brian C.P. 325/901 V2 and cases cited
therein.]
Section 3(4) of the Limitation Act 1994 provides
that an action shall not be brought “upon any judgment after the expiration of twelve years from the date
on which the judgment became enforceable”. The judgment is not defined
by the Limitation Act of 1994 but it could only apply to a judgment given
outside Vanuatu if
Parliament expressly said so. This is clearly not the
case in the present situation.
The correct law is that actions in Vanuatu on a
judgment given outside this country are, to be treated as actions on a
contract
and thus to have a limitation period of 6 years pursuant to Section
3(1) of the Limitation Act of 1994. This is supported by
the following two
persuasive authorities:
· &n sp;
si>Berliner Industriebank AG v, JOST
(1971) 2 QB 463
· p;
/ SGC v. O’Brian (referred to earlier)
It transpires also from Halsbury [paras. 658
& 661 (28 Vol.)] in support, that an action must not be brought upon
judgment
after the expiration of six years from the date on which the
judgment became enforceable.
The six-year period of limitation laid down for
actions founded on simple contract applies, among other things, to an action
founded on a foreign judgment.
Where a contract is implied by law, for example
in the case of an action for money had and received, an action on it is
founded on a simple contract.
Applied to the present case, the “B.C.
Judgment” is a judgment for money had and received by the defendants
and became enforceable as of August, 1989 which is more than ten
(10) years
outside the limitation period of 6 years in accordance with Section 3(1) of
the limitation Act of 1994 (Vanuatu).
However, is the renewal of the “B.C.
Judgment” of 1989 by Supreme Court of British Columbia on 3rd
August, 1999 in accordance with the State of British Columbia Limitation Act
1996 (S.3(3)(f)), constitutes a new judgment
and as such within the 6 years
limitation time in accordance with Section 3(1) of the Vanuatu Limitation
Act of 1994 and
therefore, still valid and is enforceable as of 3 August,
1999?
Section 3(3) of the Limitation Act [R.S.B.C.]
1996 (Canada) provides as follows:
“3 – Limitation periods
3. (1)…
(2) …
(3) After the expiration of 10 years after the date on
which the right to do so arose a person may not bring any of the following
actions:
(a) …
(b) …
(c) …
(d) …
(e) …
(f) on a judgment for the payment of money or the
return of personal property…”
In my judgment, a renewal of a judgment does not
amount to a new judgment. It is an extension of time allowed for the purpose
of enforcing the same and initial judgment enforceable as of August 1989,
under the Canadian law.
Section 3(1) of the Limitation Act of 1994,
being the law of the forum, constitutes the substantive law and mandatorily
(“shall” is used) prohibits actions to enforce an award, to be brought
after the expiration of six years, from the date on which
the cause of
action accrued. This Court therefore holds that the plaintiff/Bank of
Montreal has not satisfied it to the
standard required by Section 3(1) of
the Limitation Act of 1994 that the rights of the Bank to recover under the
“B.C.
Judgments” in Vanuatu are not statute-barred. For this reason, too
the application for summary judgment in respect of those
judgments require
to be dismissed.
The formal Orders of the Court are as follows:-
1.
That the application for summary judgment in the action by the plaintiff/
Bank of Montreal against the defendants Prescotts
is dismissed.
2.
The plaintiff will pay the defendant’s cost and costs be taxed failing
agreement.
DATED
AT PORT-VILA, this 25th DAY of SEPTEMBER, 2000
BY THE COURT
VINCENT LUNABEK J
Acting Chief Justice
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