International lis pendens arise when the same action gives rise to proceedings in two jurisdictions. Under Quebec law, a party can request to stay the proceedings as the case is pending in a foreign jurisdiction, which avoids the possibility of conflicting judgements. In a 2019 case, the Supreme Court of Canada considered this mechanism under Quebec law, in which one party commenced a divorce in a foreign country looking to revoke $33 million in gifts to his spouse. The case highlighted the discretion that trial judges have.

Court can Stay its Ruling if Proceedings are Before a Foreign Court

In R.S. v. P.R., the parties married in Belgium and then moved to Quebec. When the relationship fell apart, the husband filed for divorce in Belgium while the wife applied in Quebec. By Belgian law, the husband revoked gifts amounting to approximately $33 million that were given to the wife during their marriage. The husband also sought to stay in the Quebec court proceedings and asked for an international lis pendens to avoid potentially conflicting legal proceedings.

Article 3137 of the Civil Code of Quebec (C.C.Q.) sets out the lis pendens exception in Quebec law, which enables a court to stay its ruling on a case if the dispute is the subject of proceedings before courts in a foreign jurisdiction. The Article provides that three conditions need to be met before a Quebec court may issue a stay:

1. The action must have been filed with the foreign forum first.
2. There must be an identity of parties, of facts and of subject between the two actions that have been brought.
3. It must be possible for the foreign action to result in a decision that will be susceptible of recognition in Quebec.

All conditions need to be met for a stay to be granted. But even if all the conditions are met and there is an international lis pendens situation, the Quebec court can still decide whether the proceedings should be stayed. Only the third condition was at issue in the case. The trial judge refused to stay the proceedings and determined that she could not recognize the Belgian court decision as it would be discriminatory in Canada. The husband successfully appealed the case, and the Quebec Court of Appeal reversed the judgment. The wife then appealed to the Supreme Court of Canada.

Trial Judge Finds Foreign Decisions Could Not be Recognized in Quebec

The trial judge looked at whether the Belgian proceedings could result in a decision that could be recognized in Quebec. In particular, the judge considered whether Article 1096 of the Belgian Code Civil was “inconsistent with public order as understood in international relations.” This was one of the exceptions listed in Article 3155(5) C.C.Q. as one of the exceptions to the recognition of foreign judgments. The trial judge concluded that the Belgian law discriminated against married couples by treating them as incapable of consenting to give gifts while married. She determined this was contrary to the section 15 rights to equality in the Canadian Charter of Rights and Freedoms. For the trial judge, there was a risk that Quebec courts would not recognize a Belgian decision accepting the revocation of the gifts. However, the Supreme Court of Canada found that it was not appropriate for the judge to rely solely on the discriminatory nature of the Belgian provision to conclude there was a great risk a Belgian court decision would not be recognized in Quebec. While that was relevant, the trial judge’s approach was too restrictive.

The Supreme Court explained that the judge’s role is “limited to ensuring that a foreign decision is not enforced if the decision’s outcome would be inconsistent with certain of the underlying values of the Quebec legal system.” Consequently, Quebec courts were barred from considering the merits of the foreign decision. Instead, only where there are “clear conflicts with fundamental Quebec values” could a court decide that the proceeding in another country could not result in a decision that could be recognized in Quebec “on the basis that the decision will be manifestly inconsistent with public order as understood in international relations.” Ultimately, the Supreme Court felt that the judge focused too closely on whether the Belgian law was consistent with the Canadian Charter when, instead, the outcome of the eventual Belgian decision should have been considered.

Judge Has Discretion to Issue a Stay Based on International Lis Pendens

Even if a foreign decision may be recognized in Quebec, the Quebec court has the discretion to decide whether it would be appropriate to stay the proceedings. The Supreme Court emphasized that a stay is not automatic, as the Quebec court will have established its jurisdiction over the case, so it retains the option of declining to stay its ruling. This discretion exists even if there is nothing to prevent the foreign decision from being recognized in Quebec. Justice Gascon wrote that this was justified given the “purposes of the international lis pendens exception and in particular that of avoiding forum shopping.” It was suggested that simply because a dispute has been submitted to a foreign forum does not mean the forum has a close connection with the dispute. The court explained that the discretion provided for in article 3137 C.C.Q. is based on the idea that even if none of the exceptions to the recognition of a foreign decision applies, it may be possible that “the foreign court is not the one that has the closest connections with the dispute” or is best placed to hear the case (the doctrine of forum non conveniens).

Justice Gascon determined that while there are distinguishing characteristics, deciding whether to order a stay in a case of international lis pendens could be based on considerations used in the context of the forum non conveniens. Previously, in Oppenheim forfait GMBH c. Lexus maritime inc, the Quebec Court of Appeal set out a list of relevant criteria for assessing forum non conveniens. These included:

1. the place of residence of the parties and of lay and expert witnesses;
2. the location of the physical evidence;
3. the place of formation and performance of the contract that resulted in the application;
4. the existence and subject of an action instituted in another country and the stage already reached in that action;
5. the location of the defendant’s assets;
6. the law applicable to the dispute;
7. the advantage the plaintiff would have in the chosen forum;
8. the interests of justice;
9. the interests of the two parties; and
10. the eventual need for an exemplification proceeding in the other country.

In R.S. v. P.R., the court agreed that the list was not exhaustive and that the weight of the criteria depended on each case. Importantly, the court highlighted that deference is owed to a trial judge’s discretionary decisions, including determining the appropriateness of ordering a stay under the C.C.Q. The Court of Appeal substituted its analysis over the trial judge’s. Still, Justice Gascon, writing for the Supreme Court, noted that the trial judge’s analysis was not unreasonable, and the Court of Appeal’s intervention was unwarranted. The husband’s application for a stay was dismissed.

Family Disputes with International Aspects are Complex

The case reminds us of the importance of trial judges’ discretion and that appeal courts can only intervene in a trial judge’s ruling on specific grounds. This decision also illustrates the complex nature of family law disputes subject to bifurcated proceedings across several jurisdictions.

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