2020 QCCA 876, 2020 QCCA 876

9189-0921 Quebec Inc. (Mbm Trading) c. Associated Foreign Exchange Inc. 2020 QCCA 876 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No: 500-09-028966-208 ( 500-17-112268-209 ) MINUTES OF HEARING DATE: July 7, 2020 THE HONOURABLE MARK SCHRAGER, J.A. APPLICANTS COUNSEL 9189-0921 Quebec inc. , c.o.b. as mbm trading mendel streicher ( also known as Mendy Streicher and Manny Streicher ) mindy wasserman 9353-9500 Quebec inc. Mtre JASON NOVAK Mtre DAVID BANON Mtre ANTOINE VAN AUDENRODE ( Spiegel Sohmer ) By videoconference RESPONDENTS COUNSEL Associated foreign exchange inc.

Associated foreign exchange, ulc, c.o.b as afex canada Mtre HUBERT SIBRE Mtre LAURA BAMBARA ( Miller Thomson ) By videoconference IMPLEADED PARTY Emmeco inc. Absent and unrepresented DESCRIPTION: Application for leave to appeal from a judgment terminating the proceedings rendered on June 15, 2020 by the Honourable Michel A. Pinsonnault of the Superior Court , District of Montreal (Art. 31 and 357 C.C.P. ). Appellants’ application to stay of the provisional execution of the appealed judgment and the proceedings in first instance (Art. 31 al. 3 and 660 C.C.P .) .

Clerk at the hearing : Mélanie Camiré Courtroom: RC-18

HEARING 13:11 Commencement of the hearing. Identification of counsel. Preliminary comments. 13:14 Submissions by Mtre Novak. 13:37 Submissions by Mtre Sibre. 13:52 Reply by Mtre Novak. 13:56 Comments by Mtre Sibre. BY THE JUDGE: Judgment – see page 3. 14:01 Conclusion of the hearing. Mélanie Camiré, Clerk at the hearing JUDGMENT [ 1 ] The Applicants seek leave to appeal a judgment rendered on June 15, 2020 by the Superior Court, District of Montreal (the Honourable Justice Michel A. Pinsonnault).

The judgment extends a Mareva injunction originally granted provisionally by the Honourable Sylvana Conte on May 29, 2020 (which has been re-extended to July 2, 2020 by Collier, J.S.C., and subsequently by Gouin, J.S.C., over Applicants’ objection and without prejudice, to August 5, 2020). The Applicants also seek the suspension of the execution of the injunction.

Significantly, the judgment dismisses the Applicants’ declinatory exception wherein they contend that the Quebec courts are without jurisdiction to entertain the matter. [ 2 ] The Applicants, Defendants in first instance, are Defendants in a lawsuit before the Ontario Courts wherein the Respondents have sued them in damages arising from alleged cheque kiting. The Respondents have obtained an order of Mareva injunction in Ontario. The contract between the parties contains a clause indicating that the courts of Ontario have jurisdiction over any dispute.

The Mareva orders sought in Quebec are in a sense in aid of the Mareva injunction in Ontario given that the domicile of the Respondents and their assets are located in this province. [ 3 ] The judge decided that the Quebec Superior Court has jurisdiction to issue the orders based on

Article 3138 C.C.Q. : 3138. A Québec authority may order provisional or conservatory measures even if it has no jurisdiction over the merits of the dispute. 3138. L’autorité québécoise peut ordonner des mesures provisoires ou conservatoires, même si elle n’est pas compétente pour connaître du fond du litige. [ 4 ] The Applicants contend that Article 3148 (2) C.C.Q. takes precedence over 3138 C.C.Q. , so that they conclude that there is no jurisdiction: 3148. In personal actions of a patrimonial nature, Québec authorities have jurisdiction in the following cases: (…) 3148.

Dans les actions personnelles à caractère patrimonial, les autorités québécoises sont compétentes dans les cas suivants: […] However, Québec authorities have no jurisdiction where the parties have chosen by agreement to submit the present or future disputes between themselves relating to a specific legal relationship to a foreign authority or to an arbitrator, unless the defendant submits to the jurisdiction of the Québec authorities.

Cependant, les autorités québécoises ne sont pas compétentes lorsque les parties ont choisi, par convention, de soumettre les litiges nés ou à naître entre elles, à propos d’un rapport juridique déterminé, à une autorité étrangère ou à un arbitre, à moins que le défendeur n’ait reconnu la compétence des autorités québécoises. [ 5 ] Judgments dismissing preliminary exceptions do not as a rule qualify for leave since a final judgment in first instance can

remedy the situation. However, certain exceptions apply such as judgments dismissing declinatory exceptions challenging jurisdiction as is the case here. [1] [ 6 ] The issue raised (i.e. the interplay between Articles 3138 and 3148(2) C.C.Q. does not appear to be the subject of a decision of this Court since the judgment of the Supreme Court of Canada in GreCon Dimter inc. v. J.R. Normand inc ., [2] which the Applicants say is by analogy applicable and controlling. There are conflicting decisions in the Superior Court.

The question is one which is appropriate to submit to a full bench of the Court, so that I will grant leave with a view to fixing an accelerated date. [ 7 ] However, I will not order a stay of the judgment of first instance nor will I order the suspension of the proceedings in the Court below. [ 8 ] Although, there is reason to grant leave as the question presents some interest, I do not think that the judgment in the lower Court suffers from an apparent weakness which would be required as a first condition to be satisfied in order to grant a suspension.

The judgment gives a reasoned consideration of the articles of the C.C.Q. against the facts of the case and relies on other Superior Court judgments providing similar

interpretations and applications of

Article 3138 C.C.Q. The failure to refer to still other Superior Court judgments is not an apparent weakness given the case law which the judge did cite and which appears to support his position. Nor do I view the fact that the wife of the principal Defendant (Mindy Wasserman) and 9353-9500 Quebec Inc. are added as Defendants in the Quebec proceedings as a weakness in the judgment. There are allegations regarding them. This argument was not raised in first instance.

It is only the absence of jurisdiction which the Applicants have raised before the Superior Court and which the judgment addresses. [ 9 ] Moreover, since the Applicants are subject to an order in Ontario, I see no prejudice to them by continuing the order here.

I note that the Ontario Court has authorized the release of funds for the Applicants’ legal fees and living expenses being the common practice in matters of Mareva injunctions. [ 10 ] Given my view on the judgment and the question of prejudice, it is not necessary to consider the balance of inconvenience, but if it were so, this also favour the Respondents for obvious reasons (i.e. that Applicants do not suffer prejudice). FOR ALL THE FOREGOING REASONS, THE UNDERSIGNED : [ 11 ] GRANTS the Applicants’ application to appeal; [ 12 ] GRANTS leave to appeal the judgment of the Honourable Justice Michel A.

Pinsonnault, J.S.C., of June 15, 2020 dismissing the Applicants’ declinatory exception; [ 13 ] PLACES the case on the roll of November 5, 2020 in room Mignault at 9:30 am, for a hearing of (90 minutes) minutes in duration (45 minutes each) ; [ 14 ] ORDERS the Appellants, after having notified a copy upon the Respondents, to file in the Office of the Court, no later than August 7, 2020 , five copies of a written argument not exceeding (15) pages.

All documents necessary for the adjudication of the appeal (judgment under appeal, pleadings, excerpts from depositions, etc.) shall be attached; [ 15 ] ORDERS the Respondents, after having notified a copy upon the Appellants, to file in the Office of the Court, no later than August 28, 2020 , five copies of a written argument not exceeding (15) pages and of his supplementary documents; [ 16 ] TAKES NOTE of the parties’ consent to comply with the time limits for the notification and filing of memoranda set by this judgment, notwithstanding the suspension of the civil procedure time limits provided for in order no. 2020-4251 signed on March 15, 2020 by the Chief Justice of Quebec and the Minister of Justice; [ 17 ] DISMISSES the Appellants’ application to stay the provisional execution of the judgment appealed; [ 18 ] DECLARES , for purposes of clarity, that the proceedings in first instance are not hereby suspended such that the provisional injunction remains in force and may be continued, the whole at the discretion of the Superior Court; [ 19 ] DIRECTS the parties’ attention to

Article 376 C.C.P. and

section 55 of the Civil Practice Regulation, which read as follows: 376. The appeal lapses if the appellant does not file a brief or a memorandum within the time limit for filing. The appellate clerk issues a certificate of lapse of appeal, unless an appellate judge is seized of an application for an extension. A respondent or any other party that does not make a timely filing of its brief or memorandum is precluded from filing and cannot be heard at the hearing unless so authorized by the Court of Appeal. 55. Format. The memorandum shall include a title page, a table of contents and be paginated consecutively.

The provisions relating to briefs (including the final requirements) apply to memoranda with the necessary adaptations. [ 20 ] DIRECTS the parties’ attention to Practice Direction G-3 (last amendment: February 27, 2017) encouraging them to attach a technological version to each paper copy of their brief, memorandum and book of authorities. Such technological version should preferably be in Word format but may also be in PDF format enabling key-word searches.

The USB drive is the format preferred by the Court, but CD / DVD-ROM are also accepted; [ 21 ] THE WHOLE with legal costs to follow the outcome of the appeal.

MARK SCHRAGER, J.A.