Lax v. Lax
70 O.R. (3d) 520
[2004] O.J. No. 1700
Docket No. C39635
Court of Appeal for Ontario
Laskin, Feldman and Armstrong JJ.A.
April 26, 2004
Conflict of laws -- Foreign judgment -- Enforcement -- Foreign judgment constituting simple contract debt -- Six- year limitation period in s. 45(1)(g) of Limitations Act applying to actions to enforce foreign judgment -- Limitations Act, R.S.O. 1990, c. L.15, s. 45(1)(g).
Limitations -- Foreign judgments -- Foreign judgment constituting simple contract debt -- Six-year limitation period in s. 45(1)(g) of Limitations Act applying to actions to enforce foreign judgment -- Limitations Act, R.S.O. 1990, c. L.15, s. 45(1)(g).
The plaintiff sued the defendants in California and obtained default judgment against them in 1992. In 2001, She commenced an action in Ontario to enforce the foreign judgment. In their statement of defence, the defendants pleaded that under s. 45(1)(g) of the Limitations Act (the "old Act"), the limitation period for suing on a foreign judgment is six years and the action was therefore statute-barred. The defendants moved unsuccessfully for summary judgment dismissing the action. The motions judge held that the applicable limitation period for enforcing foreign judgments was not six years under s. 45(1)(g) but 20 years under s. 45(1)(c), which provides that actions "upon a judgment" must be brought within 20 years after the cause of action arose. The motions judge held that even if the limitation period had been six years, there was a discoverability issue that required a trial, namely, whether the defendants had deliberately tried to conceal their address in Ontario from the plaintiff. The defendants appealed. [page521]
Held, the appeal should be dismissed.
Except where there is an applicable Reciprocal Enforcement of Judgments Act, a foreign judgment, unlike a domestic judgment, cannot be directly enforced by execution. Rather, an action must be brought to enforce the debt it creates. Canadian courts have traditionally treated an action to enforce a foreign judgment as an action upon a simple contract debt for limitation purposes. The limitation period for an action on a simple contract debt is six years under s. 45(1)(g) of the old Act. The limitation period for an action on a domestic judgment is 20 years under s. 45(1)(c) of the old Act. A domestic judgment is normally enforced not by action but by execution against the assets of the judgment debtor, the sale of lands or garnishment of moneys owing to that debtor or the appointment of a receiver. An action to enforce a foreign judgment must be brought within six years from when the cause of action arose, which is the date of the foreign judgment. This is subject to s. 48 of the old Act, the effect of which is that the six-year limitation period does not commence until the judgment debtor, who was not in Ontario on the date of the judgment, returns to Ontario. Once the domestic judgment is obtained, it can be enforced in the usual way and is subject to the 20-year limitation period. Although there is merit in the argument that, in order to give foreign judgments the full faith and credit required by the principle of comity among nations, we must apply the same limitation period for enforcement of both types of judgments, the achievement of this type of parity would require more significant changes to the enforcement scheme than simply interpreting "judgment" in s. 45(1)(c) to include a foreign judgment. This would require legislative action. As long as only domestic judgments can be enforced by execution and the other methods referred to above, and therefore foreign judgments must be transformed into domestic judgments or registered before they are enforceable as domestic judgments, there is not parity of treatment.
As a general principle of statutory interpretation, when interpreting ordinary, non-constitutional, legislation, the original meaning rule prevails. This rule assumes that the meaning of legislation is fixed when the legislation is first enacted and, once fixed, nothing short of amendment or repeal can change it. This was not a case in which the court should depart from that principle. The provisions in question have been interpreted in a consistent manner for many years. Moreover, the legislature has now passed a new Limitations Act (S.O. 2002, c. 24) that radically changes the approach to limitations generally. The existence of this new Act militates in favour of leaving the original meaning of the sections of the former Act as they have been interpreted historically. It remains the law that a foreign judgment constitutes a simple contract debt, and the six-year limitation period in s. 45(1) (g) of the old Act continues to apply to it. Further, a foreign judgment is not a "judgment" within the meaning of s. 45(1)(c).
The evidence on the record suggested that the defendants came to Ontario in 1992. The plaintiff's position was that she did not know until 1997 that the defendants were in Ontario and did not know their address in Ontario. The motion judge was satisfied on the record that there was sufficient evidence that the defendants may have deliberately hidden their correct address from the plaintiff to allow the case to go to trial. The motion judge made no palpable or overriding error in declining to grant summary judgment in favour of the defendants. There was a triable issue as to whether the plaintiff knew, what steps she took to determine the whereabouts of the defendants, and what steps the defendants took to prevent her from finding them in Ontario during the 1990s. [page522]
APPEAL by the defendants from a judgment dismissing motion for summary judgment dismissing an action. [page523]
Girsberger v. Kresz (2000), 2000 22406 (ON SC), 50 O.R. (3d) 157, 1 C.P.C. (5th) 250 (C.A.), affg (2000), 2000 22329 (ON SC), 47 O.R. (3d) 145, 45 C.P.C. (4th) 77 (S.C.J.), not folld Doel v. Kerr (1915), 1915 549 (ON CA), 34 O.L.R. 251, [1915] O.J. No. 75 (S.C.(A.D.)), consd Other cases referred to Abbott v. Collins (2002), 2002 41457 (ON CA), 62 O.R. (3d) 99, 24 C.C.E.L. (3d) 219, 26 C.P.C. (5th) 273 (C.A.); Beals v. Saldanha, [2003] 3 S.C.R. 416, 234 D.L.R. (4th) 1, 314 N.R. 209, 113 C.R.R. (2d) 189, 2003 SCC 72, 39 B.L.R. (3d) 1, 39 C.P.C. (5th) 1, [2003] S.C.J. No. 77; Bell ExpressVu Limited Partnership v. Rex, [2002] 2 S.C.R. 559, 100 B.C.L.R. (3d) 1, 212 D.L.R. (4th) 1, 287 N.R. 248, [2002] 5 W.W.R. 1, 93 C.R.R. (2d) 189, 18 C.P.R. (4th) 289, 2002 SCC 42, [2002] S.C.J. No. 43; Boulton v. Langmuir (1897), 24 O.A.R. 618 (C.A.); Bourne v. Saunby (1998), 1998 1394 (ON CA), 38 O.R. (3d) 555, 158 D.L.R. (4th) 101, 33 M.V.R. (3d) 154, 45 M.P.L.R. (2d) 6, 18 C.P.C. (4th) 3 (C.A.); Burchell v. Burchell (1926), 1926 330 (ON SC), 58 O.L.R. 515, [1926] O.J. No. 125 (S.C. (H.C. Div.)); Livesley v. E. Clemens Horst Co., 1924 18 (SCC), [1924] S.C.R. 605, [1925] 1 D.L.R. 159; London Loan & Savings Co. v. Roberts (1923), 25 O.W.N. 146 (S.C. (H.C. Div.)); Mason v. Johnston (1893), 20 O.A.R. 412 (C.A.); Morguard Investments Ltd. v. De Savoye, 1990 29 (SCC), [1990] 3 S.C.R. 1077, 52 B.C.L.R. (2d) 160, 76 D.L.R. (4th) 256, 122 N.R. 81, [1991] 2 W.W.R. 217, 46 C.P.C. (2d) 1, 15 R.P.R. (2d) 1; North v. Fisher (1884), 6 O.R. 206 (H.C.J.); Poucher v. Wilkins (1915), 1915 514 (ON CA), 33 O.L.R. 125, [1915] O.J. No. 148 (S.C. (A.D.)); Rizzo & Rizzo Shoes Ltd. (Re), 1998 837 (SCC), [1998] 1 S.C.R. 27, 36 O.R. (3d) 418n, 154 D.L.R. (4th) 193, 221 N.R. 241, 50 C.B.R. (3d) 163, 33 C.C.E.L. (2d) 173, 98 C.L.L.C. Â210-006 (sub nom. Ontario Ministry of Labour v. Rizzo & Rizzo Shoes Ltd., Adrien v. Ontario Ministry of Labour); Rutledge v. United States Savings and Loan Co. (1906), 1906 37 (SCC), 37 S.C.R. 546; Thompson v. Donlands Properties Ltd., 1934 161 (ON CA), [1934] O.R. 541 (C.A.); Wright v. Wright, [1955] O.W.N. 405 (H.C.) Statutes referred to Canadian Charter of Rights and Freedoms Courts of Justice Act, R.S.O. 1990, c. C.43, s. 6(2) Evidence Act, R.S.O. 1990, c. E.23, s. 38 Limitations Act, 2002, S.O. 2002, c. 24, s. 24(5) Limitations Act, R.S.O. 1950, c. 207, s. 48(1)(c) Limitations Act, R.S.O. 1990, c. L.15, ss. 45, 48 Marriage Act, R.S.O. 1990, c. M.3, s. 8(2) Reciprocal Enforcement of Judgments (U.K.) Act, R.S.O. 1990, c. R.6 Reciprocal Enforcement of Judgments Act, R.S.O. 1990, c. R.5 Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 60, 60.07 Authorities referred to Castel, J.G., and J. Walker, Canadian Conflict of Laws, 5th ed., looseleaf (Toronto: Butterworths, 2002) Driedger, E.A., The Construction of Statutes (Toronto: Butterworths, 1974) Ontario Law Reform Commission, Report on Limitations of Actions (Toronto: The Commission, 1969) Sullivan, R., Sullivan and Driedger on the Construction of Statutes, 4th ed. (Toronto: Butterworths, 2002)
Barry Glaspell, for appellants. Michael J. Reid, for respondent.
The judgment of the court was delivered by
[1] FELDMAN J.A.: -- The first issue on this appeal is whether the limitation period for enforcing a foreign judgment under the former Limitations Act, R.S.O. 1990, c. L.15 (the "old Act") is six years or 20 years [See Note 1 at the end of the document]. The second issue is whether the motion judge made a reversible error in his application of the discoverability principle to s. 48 of the old Act. That section postpones the commencement of a limitation period against a person who was absent from Ontario when the cause of action accrued.
[2] The case arose on a motion for summary judgment brought by the defendants (appellants) against the plaintiff (respondent). The defendants sought to dismiss the plaintiff's action to enforce a foreign judgment as statute- barred, because the action was commenced more than six years after the plaintiff obtained judgment against the defendants in California. The motion judge dismissed the motion on two grounds and ordered that the action proceed to trial. The motion judge first held that the limitation period to enforce a judgment is 20 years and that that limitation applies to a foreign judgment. And secondly, even if the limitation period was six years, the evidence of when the plaintiff learned that the defendant judgment debtors were in Ontario was unclear and required the trial of the issue to determine whether the limitation was extended under s. 48 of the old Act.
[3] For the reasons that follow, I conclude that the motion judge erred on the first issue and that the applicable limitation period to enforce a foreign judgment is six years, but that the motion judge made no reversible error in ordering the matter on to trial with one of the issues being the application of s. 48 to the facts of the case.
FACTS
[4] The respondent is the former sister-in law of the appellants. All three parties were formerly residents of California. In 1990, the respondent sued the appellants in California in respect of some shares. Although the appellants initially defended the [page524] action, they eventually allowed judgment to go against them by default on August 10, 1992, in the amount of US$1,250,227.95, including US$1 million of punitive damages.
[5] The respondent issued her statement of claim in Ontario on November 8, 2001, nine years and two months after the date of the California judgment. No foreign law is pleaded in the statement of claim. In their statement of defence, the appellants pleaded that under s. 45(1)(g) of the old Act, the limitation period for suing on a foreign judgment is six years and the action was therefore statute-barred. No reply pleading was filed.
[6] Following some discoveries, the appellants moved for summary judgment to dismiss the action. The motion judge held that the applicable limitation on a foreign judgment was not six years under s. 45(1)(g) but 20 years under s. 45(1)(c), which provides that actions "upon a judgment" must be brought within 20 years after the cause of action arose. The motion judge followed the reasoning and conclusion reached by Cumming J. in Girsberger v. Kresz (2000), 2000 22329 (ON SC), 47 O.R. (3d) 145, 45 C.P.C. (4th) 77 (S.C.J.). Cumming J.'s analysis of the limitation question was obiter dictum, as he was asked to allow a limitation defence to be raised by first reopening a summary judgment already granted in an action to enforce an Illinois judgment in Ontario. Because he declined to set aside the summary judgment, there was no opportunity to plead the proposed limitation defence. Cumming J. nevertheless went on to decide that the applicable limitation period was 20 years, so that the defendant would have received no benefit from setting aside the summary judgment in any event. On appeal, this court dismissed the appeal on the main ground and declined to address the obiter comments regarding the appropriate limitation period for enforcement of foreign judgments: (2002), 2000 22406 (ON SC), 50 O.R. (3d) 157, 1 C.P.C. (5th) 250 (C.A.).
[7] The motion judge also held that even if the limitation period had been six years, there was a discoverability issue that required a trial, namely whether the appellants had deliberately tried to conceal their address in Ontario from the respondent.
ISSUES
[8] This appeal raises the following two issues:
(1) Does s. 45(1)(c) of the old Act apply to a foreign judgment, making the limitation period for suing on such a judgment in Ontario 20 years, or does s. 45(1)(g) apply, making the applicable limitation period six years? [page525]
(2) Did the motion judge err by holding that the limitation period may be extended by the application of the discoverability principle in this case and by declining to dismiss the action summarily on that basis?
ANALYSIS
[9] As a preliminary matter, the parties addressed whether this appeal was properly before this court. Although the motion for summary judgment was dismissed, allowing the case to proceed to trial, the motion judge finally disposed of the issue whether the limitation period is 20 years or six years, thus removing the limitation period as a defence. The order is therefore a final order on a question of law and the appeal is properly brought to this court: see e.g., Abbott v. Collins (2002), 2002 41457 (ON CA), 62 O.R. (3d) 99, 26 C.P.C. (5th) 273 (C.A.). Although the second issue would, if brought as a stand-alone appeal to the Divisional Court, require leave of that court, because the two issues are so interrelated, we were able to proceed to hear the two appeals together in accordance with s. 6(2) of the Courts of Justice Act, R.S.O. 1990, c. C.43, on the basis that once the first issue was before this court, leave would inevitably have been granted on the second.
Issue 1 - The Limitation Period for Enforcement of Foreign Judgments
[10] The following sections of the former Limitations Act are relevant:
45(1) The following actions shall be commenced within and not after the times respectively hereinafter mentioned,
(b) an action upon a bond, or other specialty, except upon a covenant contained in an indenture of mortgage made on or after the 1st day of July, 1894;
(c) an action upon a judgment or recognizance,
within twenty years after the cause of action arose,
(g) an action for trespass to goods or land, simple contract or debt grounded upon any lending or contract without specialty, debt for arrears of rent, detinue, replevin or upon the case other than for slander,
within six years after the cause of action arose[.]
. . . . . [page526]
- If a person against whom a cause of action mentioned in section 45 or 46 accrues is at such time out of Ontario, the person entitled to the cause of action may bring the action within such times as are before limited after the return of the absent person to Ontario.
The history of enforcement of foreign judgments
[11] Canadian courts have traditionally treated an action to enforce a foreign judgment as an action upon a simple contract debt for limitations purposes: Rutledge v. United States Savings and Loan Co. (1906), 1906 37 (SCC), 37 S.C.R. 546; Burchell v. Burchell (1926), 1926 330 (ON SC), 58 O.L.R. 515, [1926] O.J. No. 125 (S.C. (H.C. Div.)); North v. Fisher (1884), 6 O.R. 206 (H.C.J.); Livesley v. E. Clemens Horst Co., 1924 18 (SCC), [1924] S.C.R. 605, [1925] 1 D.L.R. 159, at pp. 609-10 S.C.R.
[12] J.G. Castel and Janet Walker in Canadian Conflict of Laws, 5th ed., looseleaf (Toronto: Butterworths, 2002), explain the traditional approach at 14.3:
Apart from statute, a foreign judgment is not enforceable directly by execution, but it is capable of forming the basis for a local order for its enforcement . . .
A foreign judgment is regarded as creating a debt between the parties to it, which is said to be based on the judgment debtor's implied promise to pay the amount of the foreign judgment; this explanation describes the sense in which any lis between the parties regarding liability or the amount owing has been resolved by the court that issued the judgment and is not subject to relitigation in an enforcement proceeding. The debt so created is a simple contract debt and not a specialty debt, and it is subject to the appropriate limitation period [footnotes omitted].
[13] Two important points are addressed in this passage. The first is that, except where there is an applicable Reciprocal Enforcement of Judgments Act, unlike a domestic judgment, a foreign judgment cannot be directly enforced by execution. Rather, an action must be brought to enforce the debt it creates.
[14] The second point is that a foreign judgment is treated as a simple contract debt and not as a specialty for limitations purposes. As a result, the limitation is six years under s. 45(1)(g) of the old Limitations Act. The limitation period for enforcement of a specialty is 20 years under s. 45(1)(b).
[15] In Girsberger, supra, Cumming J. revisited the historical analysis of the treatment of foreign judgments for limitations purposes. He viewed the issue in the context of the modern approach of Canadian courts to the recognition and enforcement of foreign judgments that began with the Supreme Court of Canada's decision in Morguard Investments Ltd. v. De Savoye, 1990 29 (SCC), [1990] 3 S.C.R. 1077, 76 D.L.R. (4th) 256. That approach is based on giving "full faith and credit" to the foreign judgment as long as the [page527] court that rendered it had jurisdiction to deal with the matter and the judgment was neither contrary to the public policy of this jurisdiction, obtained by fraud, nor contrary to the principles of natural justice. These principles have been confirmed in the recent Supreme Court of Canada decision in Beals v. Saldanha, 2003 SCC 72, [2003] 3 S.C.R. 416, [2003] S.C.J. No. 77. Cumming J. reasoned at para. 49:
So long as the court in a foreign country has properly and appropriately exercised jurisdiction in an action, that court's judgment should be given full faith and credit in Ontario. Recognized and enforced foreign judgments should be recognized as "judgments" and not as an implied agreement between the parties to pay the amount of the foreign judgment. This characterization of foreign judgments would permit litigants to enforce their judgment within the 20-year limitation period provided by s. 45(1)(c) of the Limitations Act. In light of the evolution of the law applicable to the recognition and enforcement of foreign judgments and the fluidity of parties, transactions and assets in our era of globalization, a 20-year limitation period appears to be more appropriate and fair.
[16] The respondent relies on the reasoning and analysis in Girsberger. The respondent also argues that, as a matter of statutory interpretation, because s. 45(1)(c) uses the word "judgment", which is not defined in the Act, a judgment is not limited to a domestic judgment but also includes a foreign judgment. Consequently, giving the word its plain meaning, s. 45(1)(c) must apply to foreign judgments making the limitation period for enforcement 20 years. The respondent points to other statutes where in context, the word "judgment" includes both domestic and foreign judgments
[17] For me, the question raised in this appeal is whether there are circumstances that make it appropriate for the court to reinterpret provisions of a statute that have been given a particular meaning and application over a very long period of time.
[18] I think the starting point is to examine the relevant provisions in the context of the entire Act and to apply the contextual and purposive approach to statutory interpretation approved by the Supreme Court of Canada based on Elmer A. Driedger's formulation in The Construction of Statutes (Toronto: Butterworths, 1974) at p. 67:
Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context, in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.
See Re Rizzo & Rizzo Shoes Ltd., 1998 837 (SCC), [1998] 1 S.C.R. 27, 154 D.L.R. (4th) 193, at para. 21, and Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559, 212 D.L.R. (4th) 1, at para. 26. [page528]
The history of the enforcement of domestic judgments
[19] The important context for the interpretation of the limitation on actions to enforce foreign judgments is the comparable limitation on actions to enforce domestic judgments. The argument being put is that foreign judgments and domestic judgments should be treated and enforced in the same way. [See Note 2 at the end of the document]
[20] Historically, a domestic judgment was treated as a specialty, so that the limitation for enforcing domestic judgments was 20 years under the predecessors to s. 45(1)(b): London Loan & Savings Co. v. Roberts (1923), 25 O.W.N. 146 (S.C. (H.C. Div.)); Doel v. Kerr (1915), 1915 549 (ON CA), 34 O.L.R. 251, [1915] O.J. No. 75 (S.C. (A.D.)); Mason v. Johnston (1893), 20 O.A.R. 412 (C.A.). However, some doubt was raised by the court of appeal in Thompson v. Donlands Properties Ltd., 1934 161 (ON CA), [1934] O.R. 541 (C.A.), as to whether the section dealing with specialties applied to the enforcement of a domestic judgment. In that case, the court held that an unsatisfied judgment remained outstanding until satisfied, and granted a declaration that the transferee of assets from the estate of a judgment debtor remained bound in 1932 by the judgment obtained in 1896. In 1949, apparently in response to this case, s. 45(1)(c) of the then current Act (R.S.O. 1950, c. 207, s. 48(1)(c)) which limited actions on a recognizance to 20 years, was amended to add the word "judgment", thereby making it clear that there is a 20-year limitation on actions upon judgments: Wright v. Wright, [1955] O.W.N. 405 (H.C.).
[21] The next issue in respect of domestic judgments is, what is barred after the 20-year period, i.e., what is meant by "an action upon a judgment". A domestic judgment is normally enforced not by an action but by execution against the assets of the judgment debtor, the sale of lands or garnishment of moneys owing to that debtor or the appointment of a receiver. These procedures are set out in the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, the current rule being Rule 60. By rule 60.07(6) a writ of seizure and sale is in effect for six years but can be renewed for further six-year periods indefinitely. By rule 60.07(2), leave of the court is required to issue a writ of seizure and sale more than six years from the date of the order sought to be enforced.
[22] The meaning of an action on a judgment was considered in the case of Doel v. Kerr, supra. In that case, judgment for costs [page529] was ordered on December 20, 1883, execution was issued on January 25, 1884, was renewed but was allowed to expire by November 1905. The court of appeal concluded, applying the then current s. 45(1)(b), that because 20 years had passed since the date of the order and there was no writ of execution outstanding, the judgment creditor could no longer enforce the judgment.
[23] The court examined the words of the limitation section and noted that what was prohibited was the bringing of an action after the lapse of the prescribed period. The term "action" was defined as including "any civil proceeding". In so doing, the court held that an application for leave to issue execution is such a proceeding. The court distinguished its earlier decision in Poucher v. Wilkins (1915), 1915 514 (ON CA), 33 O.L.R. 125, [1915] O.J. No. 148 (S.C. (A.D.)), where the judgment creditor was held to be entitled to renewal of the writ of execution outside the 20-year period because, at the time of the application, the writ had not lapsed. In that case, the renewal was not an action but a ministerial act.
[24] In its 1969 Report on Limitations of Actions, the Ontario Law Reform Commission suggests that besides enforcing a domestic judgment through writs of execution and renewals as long as they are continuously renewed during the 20-year period, an action can be brought on a judgment within the 20- year period for the purpose of obtaining a new judgment and thereby a new commencement date for the limitation period. The Commission points out that such actions are, however, rare.
[25] In summary, a domestic judgment can be kept alive and enforced indefinitely by renewing the writ of seizure and sale. However, an application for renewal is considered an action when it is brought outside the 20-year limitation period. One may also sue on a judgment within the limitation period to obtain another domestic judgment in order to recommence the running of the 20-year period.
The effect of reciprocal enforcement acts and of s. 48 of the old Act
[26] Where the Reciprocal Enforcement of Judgments Act, R.S.O. 1990, c. R.5, and the Reciprocal Enforcement of Judgments (U.K.) Act, R.S.O. 1990, c. R.6, apply, a process is available whereby a foreign judgment of a reciprocating state can be registered with the domestic court and then enforced as a domestic judgment. The limitation for registration of a foreign judgment of a reciprocating state is six years from the date of the judgment.
[27] In contrast, a foreign judgment from a non-reciprocating state cannot be enforced under Rule 60 or under one of the above [page530] Acts. A judgment creditor with a foreign judgment cannot conduct a judgment debtor examination on the foreign judgment, but must sue on the foreign judgment in order to obtain a domestic judgment which can then be enforced in the ordinary way and is subject to the 20-year limitation period. Subject to the change in approach proposed by the court in Girsberger, a foreign judgment has been held to be a simple contract debt and subject to the six-year limitation in s. 45(1)(g) of the Act. I note that that period is consistent with the limit to register foreign judgments of reciprocating states in the reciprocal enforcement statutes.
[28] However, there is one further statutory provision that forms an important part of the scheme, particularly as it applies to foreign judgments. The effect of s. 48, quoted above, in the context of enforcement of foreign judgments, is that the six-year limitation period does not commence until the judgment debtor, who was not in Ontario on the date of the judgment, returns to Ontario. The purpose of enforcing a foreign judgment within Ontario is to execute on assets of the judgment debtor that are within the province. When a judgment debtor of a foreign action comes into the province, if the person brings assets, it is only at that time that a judgment creditor will want to seek to enforce the foreign judgment here. Where the foreign judgment was obtained against a person not in Ontario, s. 48 postpones the commencement of the limitation period for enforcing that judgment in Ontario against the judgment debtor until he or she returns here.
Overall approach
[29] In summary, a foreign judgment cannot be enforced in Ontario except by first suing on the judgment to obtain a domestic judgment against the debtor. That action must be brought within six years from when the cause of action arose, which is the date of the foreign judgment. However, if the debtor was not in Ontario on the date of the judgment, then the six years does not commence until the debtor returns to Ontario [See Note 3 at the end of the document]. Once the domestic judgment is obtained, it can be enforced in the usual way and is subject to the 20-year limitation period.
[30] This analysis demonstrates that as a procedural matter, for the purposes of enforcement, foreign judgments and domestic judgments are not equivalent. Cumming J.'s position in Girsberger is [page531] that, in order to give foreign judgments the full faith and credit that our new approach of comity among nations requires, we must apply the same limitation period for enforcement of both types of judgments. Therefore, the old Limitations Act must be interpreted to reflect that approach and to accomplish that goal.
[31] In my view, although there is merit in the philosophical approach advocated by Cumming J., in order to achieve the type of parity between domestic and foreign judgments that he is advocating, more significant changes must be made to the enforcement scheme than interpreting "judgment" in s. 45(1)(c) to include a foreign judgment. This would require legislative action. As long as only domestic judgments can be enforced by execution and the other methods discussed above, and therefore foreign judgments must be transformed into domestic judgments or registered before they are enforceable as domestic judgments, there is not parity of treatment.
[32] Looking at the differences in limitations treatment only, because the time does not run in respect of foreign judgments until the debtor returns to Ontario under s. 48, the six-year limitation applicable to foreign judgments may well compare in practice more favourably with the 20-year limitation on domestic judgments than might first appear to be the case. For example, if a judgment debtor does not return to Ontario for 15 years after the foreign judgment was obtained, the applicable limitation period would exceed 20 years.
[33] Importantly, the legislature has seen fit to distinguish statutorily between foreign judgments from reciprocating states and from non-reciprocating states, by providing a registration procedure with a six-year limitation on registration. That six years is equivalent to the six-year limitation on actions on foreign judgments, and can arguably be seen as a legislative attempt to impose some parity on foreign judgments as distinct from domestic ones.
[34] In Ruth Sullivan, ed., Sullivan and Driedger on the Construction of Statutes, 4th ed. (Toronto: Butterworths, 2002), the question of when it is open to a court to re- interpret a provision in a statute and change the established and accepted interpretation, where there has been no amendment of the provision, is considered. The learned author states at p. 105:
In response to this problem Canadian courts draw a sharp distinction between ordinary legislation and constitutional texts. With respect to the Charter and other constitutional documents, the courts adopt a dynamic approach. Under this approach, meaning is not tied to the framer's original understanding but is permitted to evolve in response to both linguistic and [page532] social change. With respect to ordinary legislation, however, the original meaning rule prevails. It assumes that the meaning of legislation is fixed when the legislation is first enacted and, once fixed, nothing short of amendment or repeal can change it [footnotes omitted].
And at p. 109:
When an established interpretation is contemporaneous with the initial passing of legislation, reluctance to depart from it may be greater. In such cases the persuasive force of a contemporaneous exposition is combined with the weight of stare decisis. It is still open to a court to reject an established interpretation, however, if it believes that the interpretation is mistaken or that an alternative would be more appropriate in the circumstances [footnotes omitted].
[35] In my view, this is a circumstance where the court ought to be reluctant to depart from the established interpretation. First, we are not dealing with the Canadian Charter of Rights and Freedoms or another constitutional document. Second, the provisions in question have been interpreted in a consistent manner for over a century, and in respect of the 1949 amendment, for over 50 years. Third, the legislature has now passed a new Limitations Act that radically changes the approach to limitations generally, imposing a standard two-year limitation for most actions and eliminating any limitation on the enforcement of court orders. Whether the latter provision applies to foreign judgments under the new Act is not before this court in this matter and is left for a future case. However, the existence of the new Act is another factor that militates in favour of leaving the original meaning of the sections of the former Act as they have been interpreted historically.
[36] I conclude that because it remains the law that a foreign judgment constitutes a simple contract debt, the six- year limitation in s. 45(1)(g) continues to apply to it. Further, a foreign judgment is not a "judgment" within the meaning of s. 45(1)(c), interpreting that section in accordance with the intention of the legislature when the word "judgment" was added in 1949 and as it has been interpreted and applied by the case law since that time: see para. 11, supra.
Issue 2 - The Discoverability Issue
[37] As the date of the California judgment is August 10, 1992, the respondent had six years within which to commence the action in Ontario to enforce the judgment. However, applying s. 48, the six-year period does not commence until the appellants return to Ontario. The evidence in the record suggests that the appellants came to Ontario in 1992. The respondent's position is that she did not know until 1997 that the appellants [page533] were in Ontario or their address in Ontario. The motion judge was satisfied on the record that there was sufficient evidence that the appellants may have deliberately hidden their correct address from the respondent to allow the case to go to trial.
[38] In Boulton v. Langmuir (1897), 24 O.A.R. 618 (C.A.), the court refers to the relevance of the actions of the judgment debtor in the context of the operation of the comparable section to s. 48 this way:
Be his stay long or short, if it be long enough for the creditor to have sued the debtor had he been aware of it, and if it be not clandestine and with a mere intent to defraud the creditor, the statute begins to run: Angel on Limitations, 6th ed. sec. 206; Fowler v. Hunt, 10 Johns N.Y. 464; Randall v. Wilkins, 4 Denio 577.
[39] In Bourne v. Saunby (1998), 1998 1394 (ON CA), 38 O.R. (3d) 555, 158 D.L.R. (4th) 101 (C.A.), Laskin J.A. stated at p. 562 O.R.:
The rationale for the [discoverability] principle is that it would be unjust to permit limitation periods to begin to run before plaintiffs knew or by reasonable diligence could have known they could bring an action.
[40] There is evidence in the record that the respondent's California attorney had some knowledge about the respondent's whereabouts at certain times during the 1990s but that the respondent did not.
[41] Based on the record, the motion judge made no palpable or overriding error in declining to grant summary judgment in favour of the appellants. Even with the fresh evidence, assuming it is admissible, the record suggests that there is a triable issue as to what the respondent knew, what steps she took to determine the whereabouts of the appellants, and what steps the appellants took to prevent her from finding them in Ontario during the 1990s.
CONCLUSION
[42] I would dismiss the appeal on the basis that, although the applicable limitation period is six years, the date when the limitation period commenced is an issue for trial to be determined on the application of the discoverability principle.
[43] I would award the costs of the appeal to the respondent on the partial indemnity scale, fixed at $7,500 as agreed by the parties.
Appeal dismissed. [page534]
Notes
Note 1: The question remains important because in some circumstances the former limitations apply (s. 24(5)) under the transition provisions of the new Limitations Act, 2002, S.O. 2002, c. 24 (the "new Act").
Note 2: Other Ontario statutes that specifically use the word "judgment" to include foreign as well as domestic judgments, such as the Evidence Act, R.S.O. 1990, c. E.23, s. 38 and the Marriage Act, R.S.O.1990, c. M.3, s. 8(2)(a) and (b), do not assist in interpreting the word "judgment" in this statutory context.
Note 3: No issue was raised on the appeal whether s. 48 applies only to a person who returns to Ontario after leaving Ontario or whether it also applies to a person who comes to Ontario for the first time after the cause of action arose.