Old North State Brewing Co. v. Newlands Services Inc.
[1999] 4 WWR 573 (BC CA)

FINCH J.A.:--

I - INTRODUCTION

The defendant, a B.C. company, appeals the order pronounced in B. C. Supreme Court on 31 October, 1997, [1997] 2484, [October 30, 1997] upon the application of the plaintiff, a North Carolina company, under Rule 18A, to enforce a judgment in favour of the plaintiff granted by a North Carolina court for damages for breach of contract, unfair trade practices, and other causes of action. The North Carolina Court, applying the provisions of a North Carolina fair trade statute, awarded treble damages and additionally awarded punitive damages. The contract between the parties contained a clause concerning choice of forum and choice of law as follows:

17. GOVERNING LAW

This Agreement will be governed by and interpreted in accordance with the laws of the Province of British Columbia, Canada and the parties will attorn to the jurisdiction of the Courts of the Province of British Columbia, Canada.

On the plaintiff's application in Supreme Court to enforce the North Carolina judgment, the defendant argued that the North Carolina court did not have jurisdiction, that if it had jurisdiction it should have applied B.C. law and not North Carolinian law, and that the judgment was, in any event, unenforceable in B.C. because it would offend public policy to enforce foreign law that was penal in nature. The learned summary trial judge rejected all of the defendant's arguments, and gave judgment to the plaintiff on the North Carolina judgment.

On this appeal, the defendant contended that the learned summary trial judge erred on all three issues, and seeks an order setting aside that judgment.

II - FACTS

The plaintiff is a company incorporated in the State of North Carolina, U.S.A. for the purpose of operating a micro brewery business. The defendant is a British Columbia company which carries on business in Abbotsford. The defendant has extensive experience in supplying brewing equipment within Canada, in the United States of America, and internationally. The defendant's business includes designing, constructing and selling systems and equipment for use in brew pubs and micro breweries and it maintains a business address in the United States in Sumas, Washington. It markets its systems, equipment and services throughout North America in brewing magazines and on the Internet and does so by using a photograph of a brewery in Brooklyn, New York with a testimonial of the brewmaster from that brewery.

In 1995 the plaintiff sought bids from several suppliers of brewing equipment, including Newlands, with respect to the design and supply of brewing equipment necessary for the commencement of a micro brewery business to be located in Youngsville, North Carolina, U.S.A. In response to an inquiry from the plaintiff, the defendant forwarded a brochure to the plaintiff in North Carolina describing its capabilities, services and management structure.

On or about August 1, 1995 the defendant delivered to the president of the plaintiff in North Carolina a quotation for a twenty barrel brewery system proposed for the plaintiff. A purchase order for the equipment to be purchased by the plaintiff from the defendant (the "Equipment") was prepared by the defendant on its stationery. The final form of the purchase order was delivered by the defendant to the vice president of the plaintiff in North Carolina and was there executed by her on behalf of the plaintiff.

As mentioned in paragraph 1, the purchase agreement contained the following clause:

17. GOVERNING LAW

This Agreement will be governed by and interpreted in accordance with the laws of the Province of British Columbia, Canada and the parties will attorn to the jurisdiction of the Courts of the Province of British Columbia, Canada.

The defendant required the entire purchase price of the Equipment to be paid by the plaintiff prior to shipment of the Equipment, and the plaintiff paid the funds as required. Two shipments of equipment arrived from the defendant at the premises of the plaintiff in Youngsville in May and June, 1996, respectively. Upon receipt the plaintiff employed a North Carolina firm to install the Equipment.

During the installation and commissioning of the Equipment a sales representative of the defendant travelled from British Columbia to the plaintiff's business premises in Youngsville. This sales representative was the same person who had presented the initial quotation from the defendant to the plaintiff for supply of the Equipment.

Since a number of defects in the Equipment were noted by the plaintiff during the installation and commissioning of the Equipment, they were identified to the defendant's sales representative while he was at its premises in North Carolina. Other defects were noted after the sales representative left the site and were also communicated to the defendant.

On August 21, 1996 the defendant's senior brewer travelled to the premises of the plaintiff in Youngsville to commission the brew house and assist in initiating the first brew date which had been rescheduled due to the defects identified. He remained in North Carolina from August 21, 1996 to August 26, 1996 and, while there, reconfigured the brew house control panel and otherwise worked in the plaintiff's premises to arrange functioning equipment.

As a result of difficulties experienced by the plaintiff with leaks in two of the tanks included in the Equipment, the defendant arranged for its Brewery Logistics Supervisor to visit the premises and repair the leaks. He arrived at the premises of Old North on September 18, 1996 and proceeded to attempt repairs on the leaks. The defects in the Equipment were the subject of considerable correspondence and discussion between the plaintiff's representatives in Youngsville and the defendant's representatives in Abbotsford.

As a result of problems experienced with the Equipment, the defendant constructed and delivered replacement unitanks to the plaintiff in Youngsville. The defendant's representatives performed the installation of the unitanks upon arrival at the plaintiff's premises.

On January 31, 1997 the plaintiff commenced an action (the "North Carolina action") against the defendant in the United States District Court, Eastern District of North Carolina, Raleigh Division (the "North Carolina Court"). The summons in a Civil Action and Complaint in the North Carolina action were served upon the defendant by personal delivery to its registered office in British Columbia at 2nd floor, 32112 South Fraser Way, Abbotsford, British Columbia, on Wednesday, February 5, 1997. Under the terms of the summons served upon the defendant it was required to file with the clerk of the North Carolina Court an Answer to the Complaint within 20 days after service of the summons. No Answer was filed by the defendant to the Complaint as required by the summons. As a result of the failure to file an Answer, a Default was entered by the plaintiff in the North Carolina action on February 26, 1997. A Default Judgment was then issued against the defendant in favour of the plaintiff by the North Carolina Court on March 20, 1997.

Following the issuance of the Default Judgment the plaintiff moved for Summary Judgment on the issue of damages. A trial was held before a judge of the North Carolina Court on April 21, 1997 on the issue of damages. The Court issued an Order on May 20, 1997 assessing the damages suffered by the plaintiff as quantified pursuant to the Default Judgment dated March 20, 1997.

Under the terms of the Order of the North Carolina Court quantifying the Default Judgment, the plaintiff was awarded compensatory damages which were then trebled pursuant to a North Carolina unfair trade practice statute. The Court also awarded punitive damages and attorney's fees. The total Judgment in favour of the plaintiff against the defendant was U.S.$1,188,474.13 together with interest accruing thereon at the rate of 6.06% per annum until paid.

The defendant did not attorn to the jurisdiction of the North Carolina Court, nor did it contest its liability in that Court. Neither the interpretation, nor the application of British Columbia law was brought to the attention of the North Carolina Court.

The plaintiff then brought this action in the British Columbia Supreme Court for recognition and enforcement of the judgment of the North Carolina Court. On October 31, 1997 the Honourable Mr. Justice Grist pronounced judgment on the plaintiff's application for judgment by summary trial.

The learned summary trial judge held the judgment of the North Carolina Court to be enforceable in British Columbia and the defendant was ordered to pay the total sum of Can.$1,737,361.76 plus costs at Scale 3.

In granting judgment in favour of the plaintiff, the learned summary trial judge held that the contractual provision committing the parties to attorn to the jurisdiction of the courts of British Columbia was not an exclusive choice of forum clause. Rather, the paragraph granted concurrent jurisdiction to British Columbia courts with any other court in which the matter was properly brought. He found that the North Carolina Court did have jurisdiction as a result of there being a real and substantial connection between the cause of action and the State of North Carolina.

The learned summary trial judge also held that although the contract provided that British Columbia law was to govern the transaction, the defendant's failure to defend the proceeding in North Carolina and to prove British Columbia law as a matter of fact, resulted in the North Carolina Court being obliged to apply North Carolina law in the absence of evidence of a different stipulation by the law of British Columbia.

Finally, the learned summary trial judge held that the award of treble damages did not amount to a penal judgment and that enforcement of that award was not contrary to the public policy of British Columbia on that ground or otherwise.

III - THE ISSUES

The issues raised on this appeal are whether the learned summary trial judge erred in holding that:

1.The parties' agreement as to choice of forum as expressed in the contract did not give the courts of British Columbia exclusive jurisdiction in disputes arising under the contract;

2.The parties' agreement as to choice of law as expressed in the contract did not render the North Carolina judgment based on North Carolina law unenforceable in B.C.; and

3.It was not contrary to the public policy of B.C. to enforce the North Carolina judgment which awarded treble and punitive damages.

IV - DISCUSSION

In Morguard Investments Ltd. v. De Savoye, [1990] 3 S.C.R. 1077, the Supreme Court of Canada held that courts of one Canadian province should recognize the jurisdiction of the courts in another province where there is a "real and substantial" connection between the action and the jurisdiction in which it was brought. Although the case did not involve the judgment of a foreign state, Mr. Justice La Forest, giving judgment for the court, drew heavily on the principles which he held to apply in private international law. After analyzing old rules governing the enforceability of foreign judgments, he said at 1098:

The world has changed since the above rules were developed in 19th century England. Modern means of travel and communications have made many of these 19th century concerns appear parochial. The business community operates in a world economy and we correctly speak of a world community even in the face of decentralized political and legal power. Accommodating the flow of wealth, skills and people across state lines has now become imperative. Under these circumstances, our approach to the recognition and enforcement of foreign judgments would appear ripe for reappraisal. Certainly, other countries, notably the United States and members of the European Economic Community, have adopted more generous rules for the recognition and enforcement of foreign judgments to the general advantage of litigants.

And at 1104:

It will be obvious from the manner in which I approach the problem that I do not see the "reciprocity approach" as providing answer to the difficulty regarding in personam judgments given in other provinces, whatever utility it may have on the international plane. Even there, I am more comfortable with the approach taken by the House of Lords in Indyka v. Indyka, supra [[1969]1 A.C. 33 (H.L.)], where the question posed in a matrimonial case was whether there was a real and substantial connection between the petitioner and the country or territory exercising jurisdiction.

He referred to Moran v. Pyle National (Canada) Limited, [1975]1 S.C.R. 393, a tort case, where Mr. Justice Dickson (as he then was) said in reference to a negligent manufacturer:

By tendering his products in the market place directly or through normal distributive channels, a manufacturer ought to assume the burden of defending those products wherever they cause harm as long as the forum into which the manufacturer is taken is one that he reasonably ought to have had in his contemplation when he so tendered his goods. This is particularly true of dangerously defective goods placed in the interprovincial flow of commerce.

And he concluded at 1108-9:

It seems to me that the approach of permitting suit where there is a real and substantial connection with the action provides a reasonable balance between the rights of the parties. It affords some protection against being pursued in jurisdictions having little or no connection with the transaction or the parties. In a world where even the most familiar things we buy and sell originator are manufactured elsewhere, and where people are constantly moving from province to province, it is simply anachronistic to uphold a "power theory" or a single situs for torts or contracts for the proper exercise of jurisdiction.

The dicta of Mr. Justice La Forest concerning the jurisdiction of foreign courts were applied by this Court in Moses v. North Shore Boat Builders (1992), 68 B.C.L.R. (2d) 394 (S.C.); affirmed (1993), 83 B.C.L.R. (2d) 177 (C.A.) where the plaintiff sued in British Columbia to enforce a judgment he had obtained in Alaska for breach of warranty by the B.C. manufacturer and vendor of a fish boat. Mr. Justice Cumming, for the Court, said at 190:

In summary, the judgment of the Supreme Court of Canada in Morguard, supra, offers substantial reasons to extend the real and substantial connection test to the enforcement of foreign judgments. The principles of Emanuel v. Symon [1908] 1 K.B. 302] are out of keeping with the modern understanding of the principle of comity. Modern rules of international law must accommodate the flow of wealth, skills and people across state lines and promote international commerce. The circumstances of this case fit directly within the rule in Moran v. Pyle, and the same rule which supports the assertion and taking of jurisdiction by a foreign court must govern the recognition and enforcement of that judgment in this country.

As to the factors which would indicate a real and substantial connection he said, at 189:

The courts of British Columbia consider a wide variety of factors when deciding whether or not the action has a real and substantial connection to British columbia. Common considerations include: the place the cause of action acrose; the respective residences of the parties; whether the defendant conducted business or had other dealings in British Columbia, and other similar"connecting factors".

The Supreme Court of Canada applied the principles of Morguard to foreign judgments and anti-suit injunctions in Amchem Products Inc. v. British Columbia (Workers' Compensation Board), [1993] 1 S.C.R. 897. Speaking of the principles that govern the choice of forum, Mr. Justice Sopinka, speaking for the court, stated at 912:

The choice of the appropriate forum is still to be made on the basis of factors designed to ensure, if possible, that the action is tried in the jurisdiction that has the closest connection with the action and the parties and not to secure a juridical advantage to one of the litigants at the expense of others in a jurisdiction that otherwise inappropriate.

In this case it is clear that the action brought by the plaintiff in North Carolina had a real and substantial connection with that jurisdiction. The defendant portrayed itself as a corporate citizen that operated internationally rather than out of British Columbia by virtue of its internet advertisements, the testimonial and photograph from Brooklyn, and its office in Sumas, Washington. In responding to inquiries from the plaintiff, the defendant sent promotional material to the plaintiff in North Carolina. The purchase order was executed by the plaintiff in North Carolina. The goods were delivered to the plaintiff in North Carolina. The defendant sent its representatives to North Carolina during the installation commissioning and repair of the brewing equipment it had supplied. The losses suffered by the plaintiff as a result of the installation of defective equipment were incurred in North Carolina.

There can be no doubt then that the circumstances giving rise to the action commenced by the plaintiff had a real and substantial connection to the State of North Carolina. Applying what Mr. Justice La Forest said in Morguard, as adopted and applied in Moses, I am of the view that the courts of North Carolina had jurisdiction to hear and decide the plaintiff's claim, and that, subject to the parties' agreement or any other limiting considerations of public international law, the B.C. courts should recognize and enforce that judgment when sued upon here.

In Amchem Products Inc. v. British Columbia (Workers' Compensation Board), supra, Mr. Justice Sopinka states at pages 916 and 920:

This so-called "natural forum" is the one with which the action has the most real and substantial connection....If a party seeks out a jurisdiction simply to gain a juridical advantage rather than by reason of a real and substantial connection of the case to the jurisdiction, that is ordinarily condemned as 'forum shopping'. On the other hand, a party whose case has a real and substantial connection with a forum has a legitimate claim to the advantages that that forum provides.

Thus the jurisdiction of the North Carolina Court, having established a real and substantial connection, is still subject to the existence of other factors, one of which would be an agreement by the parties to confer exclusive jurisdiction on the courts of British Columbia. In the case at bar, the appellant submits that the jurisdiction of the North Carolina Court is precluded by the operation of clause 17 cited above at para. 1, to which I will now turn.

The defendant's argument on this appeal is that clause 17 of the contract, by which both parties agreed to attorn to the jurisdiction of B.C. courts ousts any jurisdiction which the North Carolina courts might otherwise have had. The defendant relies upon Sarabia v. Oceanic Mindoro (The) (1996), 26 B.C.L.R. (3d) 143 (C.A.) to support the argument that courts should defer to forum selection clauses agreed on between the parties. In Sarabia the parties by a standard employment contract had agreed that a foreign tribunal "... shall have original and exclusive jurisdiction" over all disputes arising out of the contract. The defendant argues that the effect of clause 17 is to give B.C. courts exclusive jurisdiction.

The burden of proving that such a clause confers exclusive jurisdiction rests on the party who so asserts: see Evans Marshall & Co. Ltd. v. Bertola S.A., [1973] 1 W.L.R. 349 (Q.B.) at 361. It has been held that clear and express language is required to confer exclusive jurisdiction: see Westcott v. Alsco Products of Canada Ltd. (1960), 26 D.L.R. (2d) 281, 45 M.P.R. 395, and Khalij Commercial Bank Ltd. v. Woods (1985), 17 D.L.R. (4th) 358 (Ont.H.C.). An ambiguous choice of jurisdiction clause will not be construed to grant exclusive jurisdiction: see Schleith v. Holoday (1997), 31 B.C.L.R. (3d) 81 (C.A.).

Clause 17 on its face does not purport to confer exclusive jurisdiction. As Chief Justice Furlong said in Westcott supra, it would have been a simple matter for the draftsman to have used the word "exclusive" if that was what the parties had intended. When both parties articulate their commitment to a forum, absent the express intention to render that forum one of exclusive jurisdiction, such a clause will be interpreted as necessarily conferring concurrent jurisdiction. As noted in Khalij, Mr. Justice Rutherford states, at page 360:

In fact, some recent case law suggests that even the use of the word 'exclusive' with respect to jurisdiction of a court in a contract does not oust the discretion of another court to find jurisdiction: see G & E Auto Brokers Ltd. et al v. Toyota Canada Inc.(1980), 117D.L.R. (3d) 707, 25 B.C.L.R. 145, 13 B.L.R. 33; Pirana Small Car Centres ltd. v. Rumm et al, [1981] 5 W.W.R. 79,27 B.C.L.R. 292, 22 C.P.C.9.

The clause in the case at bar can therefore reasonably be construed as conferring concurrent jurisdiction. If there had been reason for the defendant to sue on the contract, as presently worded, it could have done so in British Columbia, and could have relied on the clause to answer any argument by the plaintiff that B.C. courts did not have jurisdiction. But, in my view, to say that the parties will attorn to the jurisdiction of the B.C. courts is very far from saying that the courts of no other state can exercise jurisdiction, if there is a proper foundation for so doing according to the rules of private international law.

In my respectful view, the learned summary trial judge did not err in holding that clause 17 did not grant exclusive jurisdiction to the courts of British Columbia. Once that conclusion is accepted, it follows for the reasons expressed earlier, that the courts of North Carolina were entitled to exercise jurisdiction over this dispute.

The defendant contends that even if the courts in North Carolina had jurisdiction, they were bound by the provisions of clause 17 to apply British Columbia law. The defendant submits that this was so even though it chose not to defend the suit in North Carolina. It argued that the plaintiff had a duty to draw clause 17 to the attention of the North Carolina court, and to adduce evidence in the North Carolina court as to the applicable law of British Columbia. No authority was cited for this proposition, but the defendant submits that to now permit the plaintiff to enforce the judgment based on North Carolina law, would, in effect, be to condone the plaintiff's breach of contract.

So far as the courts of North Carolina were concerned, B.C. law was foreign law. Foreign laws are questions of fact which must be proven by evidence of persons who are experts in that law: see Allen v. Hay (1922), 64 S.C.R. 76 at 80-81; and Castel's Conflicts of Law 4th ed., 1997 at 155-56. If foreign law is not proven, it is assumed to be the same as the law of the forum: see Canadian Fire Insurance Company v. Robinson (1901), 31 S.C.R. 488 at 493; Sharn Importing Ltd. v. Babchuk, [1971] 4 W.W.R. 517 (B.C.S.C.); and Castel supra at 153-4. No burden of proof lies on the plaintiff to adduce evidence of foreign law: Alvarodiaz v. Sun Life Assurance Co. of Canada, [1973] 3 O.R. 126 (Ont.H.C.) at 130.

In this case, the defendant was properly served with the originating document in the North Carolina action. If the defendant wished to rely on particular provisions of British Columbia law to govern the proceeding in North Carolina, it had the option to plead in the North Carolina action that British Columbia law was applicable and to prove that law to the satisfaction of the North Carolina court. In the absence of such pleading and proof, the North Carolina court had no obligation to make its own inquiries and attempt to apply British Columbia law. As the North Carolina court had jurisdiction to try the action, it had to assume that the law of British Columbia was the same as the law of North Carolina in the absence of proof to the contrary.

In any event, the defendant failed to defend the North Carolina action, despite the opportunity to do so. In determining whether or not to enforce the North Carolina judgment, it is not open to the British Columbia courts to question the judgment on the merits, or to refuse to recognize and to enforce it because of any perceived error of law or fact. The North Carolina judgment is to be treated as conclusive and unimpeachable in its finding and application of both facts and law. The only forum in which any alleged error by a North Carolina court could be raised is the North Carolina Court itself, or in the court of appeal from that court. An alleged error of law or fact is not a ground on which a British Columbia court can refuse to recognize and enforce a foreign judgment: see Henderson v. Henderson (1944), 6 Q.B. 288 (Q.B.); and Four Embarcadero Center Venture v. Kalen (1988), 65 O.R. (2d) 551 (Ont.H.C.).

Here, the defendant not only failed to appear to defend the action in North Carolina, it made no attempt to set that judgment aside. No appeal was taken from the North Carolina judgment. No effort was made in B.C. to obtain an anti-suit injunction against the enforcement of the North Carolina judgment on the ground that it did not apply B.C. law, or upon any other ground.

In my respectful view, the North Carolina court was correct in applying North Carolina law as though it were the same as the law in British Columbia. But even if it erred in law, it is not open to the defendant to take that objection in this court. The learned summary trial judge did not err in deciding this issue as he did.

North Carolina has a statute governing unfair or deceptive acts or practices in commercial transactions, cited as N.C.G.S. s.75. It reads in part as follows:

S.75-1.1 Methods of competition, acts and practices regulated; legislative policy.

(a) Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are declared unlawful.. . .

S.75-16. Civil action by person injured; treble damages.

If any person shall be injured or the business of any person, firm or corporation shall be broken up, destroyed or injured by reason of any act or thing done by any other person, firm or corporation in violation of the provisions of this Chapter, such person, firm or corporation so injured shall have a right of action on account of such injury done, and if damages are assessed in such case judgment shall be rendered in favour of the plaintiff and against the defendant for treble the amount fixed by the verdict.

The plaintiff pleaded the provisions of this statute in the North Carolina action and it alleged facts in that action, which would bring the defendant's conduct in this case within the ambit of the legislation. The plaintiff also pleaded and relied on the North Carolina statute which authorizes the imposition of punitive damages. The North Carolina court awarded both treble damages and punitive damages. In its order of 20 May, 1997 the court said:

As demonstrated by plaintiff, considerable damages were incurred resulting from defendant's provision of defective and non-conforming brewery equipment for use in plaintiff's brewery operations. At trial, plaintiff presented comprehensive evidence documenting the precise damages suffered because of defendant's actions. After considering plaintiff's evidence, the court finds that plaintiff is entitled to damages in the amount of$308,609.33. Moreover, pursuant to N.C. Gen. Stat.75-16, this award must be trebled for a total of$925,827.99.

Finally, the court finds that punitive damages reappropriate in this instance based on the uncontroverted showing of defendant's willful misconduct. Plaintiff has demonstrated by clear and convincing evidence that plaintiff is entitled to such damages. Accordingly, operating within the punitive damages framework enunciated in N.C. Gen. Stat. 1D-35, the court awards plaintiff $250,000 in punitive damages.

On this appeal, the defendant contends that the enforcement of the North Carolina judgment in British Columbia amounts to the enforcement of foreign penal laws. It submits the enforcement of foreign penal laws is contrary to public policy, and that the learned summary trial judge erred in not refusing to enforce the North Carolina judgment on this ground.

The plaintiff also submits that to allow the plaintiff to enforce its judgment in British Columbia would "... violate natural justice and would contravene public policy by encouraging and rewarding the respondent to breach its own agreement".

Castel supra says the following about our courts' refusal to enforce foreign penal law on grounds of public policy:

91. Foreign penal law

In principle, the courts of a common law province or territory will not enforce a foreign penal law or judgment, either directly or indirectly. A penal law is one which imposes punishment for some breach of duty to the state as opposed to a remedial law directed at securing compensation for a private person who has suffered damage as a result of a breach of duty owed to him or her.. . .

94. Public policy

Canadian courts will not recognize or enforce a foreign law or judgment or a right, power, capacity, status or disability created by a foreign law that is contrary tithe forum's stringent public policy, "essential public or moral interest" or "conception of essential justice and morality." Public policy serves a corrective function. Its use is defensive.. . .

If foreign law is to be refused any effect on public policy grounds, it must violate some fundamental principle of justice, some prevalent conception of good morals, or some deep-rooted tradition of the forum.. . .

In the common law provinces of Canada very seldom has public policy been invoked in the courts with success as this exception has been construed narrowly.

(footnotes and citations omitted)

In Huntington v. Attrill, [1893] A.C. 150, J.C.P.C., the Privy Council held that to come within the rule against the enforcement of foreign penal laws, the proceeding "... must be in the nature of a suit in favour of the state whose law has been infringed" (at 157-8). Enforcement of a foreign judgment will not be refused on the grounds that the foreign law on which the judgment is based is more harsh than the law of the forum: see United States of America v. Ivey (1995), 130 D.L.R. (4th) 674 (Ont.H.C.). In a decision of this court in Block Brothers Realty v. Mollard (1981), 27 B.C.L.R. 17, [1981] 4 W.W.R. 65, 122 D.L.R. (3d) 323, Mr. Justice Craig, citing Macdonald C.J.B.C., as he then was, in National Surety Co. v. Larsen, [1929] 4 D.L.R. 918, [1929] 3 W.W.R. 299, 42 B.C.R. 1 (C.A.), stated at 330 D.L.R.:

I think that we should bar an action on the ground of public policy only if we could say it was contrary to 'essential public or moral interest' or 'contrary to our conceptions of essential justice and morality'.

This rule was followed by Mr. Justice Spencer in Minkler v. Sheppard (1991), 60 B.C.L.R. (2d) 360 when he said at 365 and 366:

The second issue to be decided is whether there is some ground of public policy on which this court should refuse to give judgment based upon the Arizona judgment. Mr. Fox argued that since Arizona law is so far different from British Columbia law in imposing liability on a wife for the debts of the husband, it would be against the policy of our common law to enforce this judgment. I do not think that is the sort of public policy basis upon which the courts act in refusing to enforce foreign judgments. Just because the law of another country maybe different from ours is no reason not to enforce a judgment.... Although the law of Arizona differs from our law there is nothing about it which is contrary to our conceptions of essential justice and morality.

See also First Interstate Bank of Kalispell N.A. v. Seely (1983), 54 A.R. 285 (Q.B.); Battaglia v. Ballas (1983), 49 A.R. 352 (Q.B.); and S.A. Consortium and General Textiles v. Sun and Sand Agencies Ltd., [1978] 1 Q.B. 279, at 288 and 299-300.

With respect to the award of treble damages, there is a specific federal Canadian statute providing the Attorney General of Canada a discretion to hold treble damage awards made in foreign anti-trust actions unenforceable in Canada. This power is specifically set out in the Foreign Extraterritorial Measures Act R.S.C. 1985, c. F-29. Anti-trust laws are defined as those having as their purpose the preservation or enhancement of competition. The Attorney General of Canada is given the discretion to declare treble damages awards unenforceable, but only those awards made in actions based on anti-trust laws. The Act could have, but did not, either declare all treble damage awards made by foreign courts unenforceable in Canada or provide the Attorney General of Canada the discretion to declare such awards based upon statutes other than anti-trust laws unenforceable. If the enforcement of treble damage awards generally was contrary to the public policy of Canada the statute would be irrelevant and unnecessary since such awards would not be enforceable in any event. It follows that until the Attorney General of Canada invokes the provisions of the Foreign Extraterritorial Measures Act, treble damage awards based even on anti-trust laws are enforceable and are therefore not contrary to the public policy of Canada.

Here the judgment from North Carolina contains an award of treble damages pursuant to the North Carolina statute, on the basis that the defendant was found to have committed unfair and deceptive trade practices, and also includes an award for punitive damages. The trebling of damages was within the power of the Court and can be equated to exemplary damages as applied by Canadian courts. As articulated above, it cannot therefore be said that to enforce an award for treble damages would be contrary to the essential or moral interests of British Columbia or that the damages are founded in moral turpitude and inconsistent with the good order and solid interests of British Columbia society.

With respect to the award for punitive damages, it is clear that the British Columbia courts have the jurisdiction and authority to award punitive damages in an appropriate case and such an award in a foreign judgment cannot, therefore, be considered to be contrary to the public policy of the British Columbia. Both awards are remedial and for the benefit of individuals, and not for the benefit of the state whose laws were enforced. Treble damage awards based upon an unfair and deceptive trade practice statute as in this case, and not an anti-trust law, cannot be considered as contrary to the public policy of British Columbia.

In my respectful view, the learned summary trial judge did not err in rejecting the public policy argument, and did not err in granting judgment to the plaintiff on the North Carolina judgment.

I would dismiss the appeal.