Court File and Parties

Court of Appeal for Ontario Date: 20230919 Docket: C69663

Tulloch C.J.O., Lauwers and Miller JJ.A.

Between

Boris Aleksandrovich Agrest Applicant (Respondent in Appeal)

and

Leonid Elikovich Pekker Respondent (Appellant)

Counsel: Patrick Bakos, for the appellant Bevan Brooksbank and Julia Martschenko, for the respondent

Heard: September 13, 2023

On appeal from the judgment of Justice Peter J. Cavanagh of the Superior Court of Justice, dated June 8, 2021.

Reasons for Decision

[1] The appellant, Mr. Leonid Pekker, appeals from the judgment of Cavanagh J., dated April 12, 2022, in which the application judge recognized Ontario’s jurisdiction to enforce a judgment made by a Russian court.

[2] The underlying facts of this appeal arise from a claim that dates back to June 27, 2013. The claim was commenced in Russia by the respondent in this matter, Mr. Boris Agrest. The claim stems from the non-payment of a loan advanced to Mr. Pekker by Mr. Agrest.

[3] The claim was commenced in the Nikulinsky District Court of Moscow pursuant to the Civil Procedure Code of the Russian Federation (“Code”). In accordance with Article 133(1) of the Code and standard court practice, the claim was served by judicial telegram to a Moscow address, which was the last known address reported to Mr. Agrest by Mr. Pekker.

[4] The parties were summoned to a July 25, 2013 court appearance to address the scheduling of the trial. Mr. Pekker did not attend this court date. At the July 25, 2013 appearance, August 2, 2013 was set as the date for trial.

[5] Following the setting of the trial date, several attempts were made to inform Mr. Pekker of the court date, to no avail. On August 2, 2013, Mr. Pekker did not appear and the matter was adjourned to September 23, 2013. At the September 23, 2013, hearing, an ex parte judgment was rendered in favour of Mr. Agrest for the full amount of the claim, plus interest and costs.

[6] The decision of the Nikulinsky District Court notes that “the respondent did not appear at the court hearing, while duly notified of the date, place and time of the case hearing”: Nikulinsky District Court, Moscow, 23 September 2013, Civil Case No. 2-4418/13 (Russia) (Certified Translation from Russian into English).

[7] According to the appellant, he learned of the judgment in mid-December 2013 through his bank, after which he appealed the judgment. The appeal was heard on May 20, 2014, by the Civil Division of the Moscow City Court and was dismissed. On appeal before the Moscow City Court, Mr. Pekker raised the issue of insufficient notice, but the appellate court’s decision notes that the correct service standards were followed in the court below:

It is obvious from the case materials that the court sent judicial notices to the defendant [Mr. Pekker]. These court notices available in the case materials show that the court of first instance properly fulfilled the obligation to notify the persons participating in the case, and the defendant's failure to receive the judicial notices cannot serve as evidence of a violation by the court of the requirements and norms of procedural legislation and it is not a reason for cancelling the decisions on the grounds of paragraph 2 Part 4 Clause 330 of the Code of Civil Procedure of the Russian Federation: Moscow City Court, Moscow, 20 May 2014, Civil Case No. 33014226/14 (Russia) (Certified Translation from Russian into English).

[8] While the appellant had a right of further appeal to the Presidium of the Moscow City Court, he did not exercise this right. The deadline for further appeals has now passed, and the Russian judgment can no longer be challenged in Russia.

[9] Recently, in early 2019, Mr. Agrest learned through a mutual acquaintance that Mr. Pekker has significant assets in Canada. Based on this new information, Mr. Agrest brought an application in Canada to enforce the Russian judgment.

[10] Following the hearing of the enforcement application, the Russian judgment was recognized and enforced.

[11] The application judge reviewed the applicable law and based his decision on Beals v. Saldanha, 2003 SCC 72, [2003] 3 S.C.R. 416. He found that Mr. Pekker had not made out the defence that he was denied natural justice during the proceedings in Russia. As such, the Russian proceedings were not contrary to Canadian notions of fundamental justice.

[12] We see no error in the application judge’s decision or reasoning.

[13] Throughout the Russian proceedings, Mr. Pekker was given adequate notice of the claim made against him and was granted the opportunity to defend the claim. Further, he had the opportunity to raise the issue of insufficient notice on appeal to the Moscow City Court. The appellate court made a factual finding that Mr. Pekker was given adequate notice, and Mr. Pekker did not avail himself of the opportunity to further appeal this finding in Russia.

[14] There is no evidence as to the arguments made and the evidence presented on the appeal. We see no basis on which to interfere with the application judge’s decision on either substantive or procedural grounds. In our view, the minimum standards of fairness were met in the Russian process.

[15] Further, we see no error by the application judge in excluding the report or statement of Professor Solomon, a purported expert witness on Russian law and governance. We agree with the application judge’s reasons for excluding this evidence. The report was not supported by an affidavit sworn by Professor Solomon and was inadmissible. Furthermore, we agree that even if the report was properly before the application judge, it was within the discretion of the application judge to determine the weight to apportion to the purported evidence. In this case, he chose not to assign any weight to the statement as it was not sworn, nor did it affirm that the specific Russian proceedings, which were the subject of the application, were tainted by fraud.

[16] In the circumstances, we see no palpable and overriding error in the reasons of the application judge that would warrant appellate interference.

[17] Accordingly, the appeal is dismissed. Costs to the respondent, Mr. Agrest, in the amount of $10,000.

“M. Tulloch C.J.O.”

“P. Lauwers J.A.”

“B.W. Miller J.A.”