Vermont Judgment Enforced in Ontario – Natural Justice Defence Fails (Airi v. Nagra, 2019 ONSC 3411)

In Airi v. Nagra, the Plaintiff commenced an action in Ontario to enforce a trial judgment from Vermont against the Defendant. The Plaintiff brought a motion for summary judgment, which was granted by the court.  The motion was opposed on the basis of fraud, denial of natural justice and public policy.

While all of the Defendant’s defences were dismissed and summary judgment was granted by the Ontario court, the court did shed some light on when a denial of natural justice defence may be an effective defence in response to an action for recognition and enforcement of a foreign judgment.

In this case, the Defendant’s position was that he suffered a denial of natural justice because the trial in Vermont took place at a time when the Defendant was unable to enter the United States and participate in the trial in person.

In reviewing the record, the court found that:

  • the Defendant was advised by the Vermont court on three separate occasions that the Defendant could request to participate in the trial by video conference;
  • the Defendant brought motions in which he made the Vermont court aware of his difficulty in attending court in person; and
  • The Vermont court advised the Defendant repeatedly of steps he could take to request video conference participation, which Nagra chose not to do.[1]

How would the case have been decided had the Vermont court not provided video conference participation rights or if the technology behind the video conferencing capabilities were insufficient for the Defendant to participate adequately? The Ontario court hypothesized:

Had the defendant availed himself of that process, and been denied video conference participation rights, those would be different facts. Or if he had participated by video conference but felt that he was unable to meet the case against him by virtue of alleged limitations of that form of participation, those would again be different facts.[2]

As stated by the Supreme Court of Canada in Beals[3], the inquiry when considering the denial of natural justice defence is “restricted to the form of the foreign procedure and to due process….” If the form of the procedure of the foreign court meets minimum Canadian standards of fairness, then the denial of natural justice defence will likely fail. Had the Defendant been denied an alternative to personal attendance at trial or had the alternative to personal attendance failed to provide a minimum standard of fairness in the trial procedure, then this outcome could have been different.

If at first glance a lawyer determines that a denial of natural justice defence may be available to a Defendant to a recognition and enforcement action, then it is important for the lawyer to examine and distill all of the facts related to the procedure afforded by the foreign court to the parties prior to judgment. Shortcomings in the foreign procedure that affected fairness to the Defendant will trigger the denial of natural justice defence.

[1] Paras. 54-57

[2] Para. 58.

[3] [2003] 3 SCR 416

Ruzbeh Hosseini is a senior lawyer who practices in the business litigation and cross-border litigation groups. Ruzbeh is regularly involved in the development of litigation strategy and he has appeared in the Ontario Superior Court of Justice and Ontario Court of Appeal on behalf of clients.

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