This article will focus on the Foreign Money Claims Act [RSBC 1996] Chapter 155 and it will largely quote from the case law. Surprisingly, in over 25 years working in the legal profession, I have never had to reference the Foreign Money Claims Act “FMCA”. The FMCA applies when conversion of foreign currency becomes relevant. I will reference a blog post by Mr. Peter J. Roberts, Q.C. of Lawson Lundell which provides a helpful summary regarding the Act. Click the link to read his article. The quote:
“It provides the courts with authority to order that a judgement be stated in the amount of Canadian currency necessary to purchase the appropriate amount of “the other currency” based on the exchange rate of a ‘chartered bank located in British Columbia at the close of business on the conversion date.” The test applied by the courts to invoke the FMCA is whether a judgment creditor will be “most truly and exactly compensated if all or part of the money payable” ought to be in a “currency other than the currency of Canada.” Measuring damages by using a foreign currency can apply in both contract and tort claims.”
There are a number of cases that have referenced the FMCA and one very recently pertaining to a tort matter – a motor vehicle accident claim in which the Plaintiff was a resident of the State of California and the Plaintiff’s costs relating to future care were going to be incurred in US dollars. The FMCA was referenced to ensure that adequate compensation would be made.
The referenced case is Brooks v. Habib, 2019 BCSC 1398 (CanLII) and I will quote directly from the case:
[426] The Foreign Money Claims Act, R.S.B.C. 1996, c. 155, provides for damages to be made payable in the amount of Canadian currency that is necessary to purchase the equivalent amount of another currency, if that is necessary to provide full compensation. The Act states:
(1) If, before making an order for the payment of money arising out of a claim or loss, the court considers that the person in whose favour the order will be made will be most truly and exactly compensated if all or part of the money payable under the order is measured in a currency other than the currency of Canada, the court must order that the money payable under the order will be that amount of Canadian currency that is necessary to purchase the equivalent amount of the other currency at a chartered bank located in British Columbia at the close of business on the conversion date.
(2) The conversion date is the last day, before the day on which a payment under the order is made by the judgment debtor to the judgment creditor, that the bank referred to in subsection (1) quotes a Canadian dollar equivalent to the other currency.
[427] In this case Mr. Brooks resides in California. His expenses are in United States dollars. Therefore, the damages I have awarded for cost of future care and special damages (but not for loss of housekeeping capacity) are stated in US dollars. The amount payable under the order will be the amount of Canadian currency that is necessary to purchase the equivalent amounts, pursuant to the Foreign Money Claims Act: Bonham v. Weir, 2009 BCSC 1080 at para.48.
We also see in Gharavi v. Khouzani, 2017 BCSC 48 (CanLII), in which the FMCA was referenced and an analysis is offered in this case on whether it is mandatory to state the amount to be ordered in Canadian currency necessary to purchase an equivalent amount in Iranian rial. It offers a great explanation and comprehension of the Act. Again, I am going to quote from the decision because it is well worded and an excellent summary of the law:
[24] Having concluded that the Plaintiff should have the judgment requested, the question which arises is whether it is mandatory to make the order payable in the amount of Canadian currency that is necessary to purchase an equivalent amount of Iranian rial and that the purchase must be at a “…chartered bank located in British Columbia…” or whether the judgment requested can be granted in Iranian rial?
[25] On the question of whether is it possible for a judgment sought to be expressed in a foreign currency, Griffin J. made the following statements in Litecubes, L.L.C. v. Northern Light Products Inc., 2009 BCSC 427 (CanLII):
The choice of stating a judgment in foreign currency, or in the equivalent Canadian currency at the time of payment, was recommended by the Law Reform Commission of British Columbia in its report which preceded the Act, but there were some arguments that the first choice might be unconstitutional: Law Reform Commission of British Columbia, Report on Foreign Money Liabilities (Victoria: Queen’s Printer for British Columbia, 1983) at 44-49, 60 [“the Report”]. This is because s. 12 of the federal Currency Act, R.S.C. 1985 c. C-52 provides as follows:
… any reference to money or monetary value in any indictment or other legal proceedings shall be stated in the currency of Canada.
Section 12 of the Currency Act could be interpreted as precluding Canadian courts from expressing judgments in a foreign currency. This view was analyzed and rejected by the Law Reform Commission of B.C. in its Report, but the view that a judgment must be stated in Canadian currency remains: see the decision of the Manitoba Court of Appeal in Kellogg Brown & Root Inc. v. Aerotech Herman Nelson Inc., 2004 MBCA 63 (CanLII), 238 D.L.R. (4th) 594 at para. 81, and the view of the dissent at paras. 141-145; see also Salzburger Sparkasse v. Total Plastics Service Inc. (1988), 1988 CanLII 2872 (BC SC), 27 B.C.L.R. (2d) 333, 50 D.L.R. (4th) 639 (S.C.).
It appears that the B.C. Legislature chose to avoid the controversy of whether or not a judgment in foreign currency would be unconstitutional, and instead chose to provide, in s. 1(1) of the Act, that the judgment would be stated in Canadian currency in an “equivalent amount” to the foreign currency at the conversion date.
(at paras. 7-9)
[26] Section 12 of the Currency Act, R.S.C. 1985, c. C‑52 (“CA”) states:
Public accounts and statements
All public accounts established or maintained in Canada shall be in the currency of Canada, and any reference to money or monetary value in any indictment or other legal proceedings shall be stated in the currency of Canada.
[27] The primary issue before the Court in Litecubes, supra was the date when a judgment from Missouri should be stated in Canadian currency. In Salzburger, the issues before the Court were the date when the conversion and the calculation of the exchange rate should take place. Bouck J. concluded what was then s. 11 of the CA should apply so that Australian schillings were to be converted into Canadian dollars as of the date of the judgment. As the decision was decided before the 1990 enactment of the FMCA, the provisions of the FMCA were not considered.
[28] In Kellogg Brown, supra, the issue before the Manitoba Court of Appeal was also when the date of conversion of a judgment should take place: when the cause of action arose, when the Writ was issued, at the date of the trial, or at the date when payment was made. After concluding that the phrase “other legal proceedings” in the Currency and Exchange Act, R.S.C. 1970, c. C‑39 (“CEA”) was not intended to include statements of claim (at para. 77) or to each and every document arising from a proceeding (at para. 79), the majority made this statement:
…, s. 12, (of what was the Currency Act) requires that any money referenced in a legal proceeding must be stated in Canadian currency. This section has traditionally been understood as prohibiting the entry of a judgment expressed in a foreign currency. Se Baumgartner v. Carsley Silk Co. Ltd. (1971), 1971 CanLII 1118 (QC CA), 23 D.L.R. (3d) 255 (Que. C.A.), and Law Reform Commission of British Columbia, Report on Foreign Money Liabilities (Victoria: Queen’s Printer for British Columbia, 1983) at 11.
(at para. 73)
[29] The decision in Kellogg Brown, supra, did not make specific reference to any attempt by the Manitoba Legislature to enact a provision so that the consideration of the Court related to “judicial development” rather than to “legislation”. As well, no reference was made to the British Columbia legislation and the provisions of the FMCA and theRegulation and there was no discussion about whether s. 12 of the CA was ultra vires the Federal government as an attempt to control the process of the “administration of justice” power provided to a province.
[30] Schacht v. Schacht (Estate), [1981] B.C.J. No. 486, is relied upon by the Plaintiff. In Schacht, supra, Gould J. relied upon what was then s. 11 of the CEA to decide that the foreign judgment of the plaintiff had to be converted into Canadian funds. The decision predates the provision in the FMCA so that the question of whether the FMCA must always apply was not raised although it was assumed that the CA applied.
[31] I conclude that the FMCA does not always apply where an action is commenced relating to a foreign judgment and that a judgment in British Columbia can be granted in a foreign currency. Section 38(1) of the COEA states that nothing under Part 2 deprives a judgment creditor of the right to bring an action on the judgment. The requirement ins. 31 of the COEA which makes the FMCA mandatory only relates to a judgment sought to be registered pursuant to s. 29(1) of the COEA. Here, the Plaintiff does not seek to register the Iran Judgment. There is nothing under Part 2 of the COEA which mandates the FMCA where a judgment creditor brings an action on a foreign judgment as did the Plaintiff here.
[32] Second, s. 3(2) of the Regulation contemplates the registration in the Land Title Office of a foreign judgment in foreign funds from a non‑reciprocating state and provides that s. 3(1) of the Regulation does not apply. As it is apparent that such a judgment can be registered in foreign funds, I cannot conclude that it would have been the intent of the Legislature to allow the registration of a foreign judgment in foreign funds in the Land Title Office while denying a judgment creditor the ability to bring an action on that judgment and have that judgment granted in a foreign currency where the judgment creditor could not comply with s. 1(1) of the FMCA if it was the case that the particular foreign currency could not be purchased at a chartered bank located in British Columbia.
[33] Third, under the Regulation, a “foreign money judgment” is defined as being a judgment to which s. 1 of the FMCA applies and s. 3(1) of the Regulation provides that there must be a conversion of the amount owing where a “…person having a claim to payment of money owing under a foreign money judgment who wishes to enforce that claim in a manner contemplated by the COEA must convert the amount owing under the foreign money judgment into Canadian currency…”. I am satisfied that this action on the judgment cannot be included within the phrase that it is a “…claim in a manner contemplated by…” the COEA. What is “contemplated” under the COEA is the registration of a judgment. What is specifically excluded from the COEA operation cannot be brought within the phrase that is a claim “contemplated”. Sections 29(1) and 31 of the COEAspecifically exclude from its operation the right of a judgment creditor to bring an action on the judgment whereas what is “contemplated” by the COEA is a registration of the foreign judgment. It is an action on a judgment and not an application to have the judgment registered which is claimed by the Plaintiff.
[34] Finally, I cannot be satisfied that it was the intention of the Legislature to provide no remedy for a judgment creditor where the currency of his or her judgment is a currency that may not be capable of conversion into Canadian currency “…at a chartered bank located in British Columbia…”.
[35] I am satisfied that these exclusions are evidence of an intention by the Legislature not to have the FMCA apply in all circumstances and govern all transactions relating to foreign judgments. I conclude that the inherent jurisdiction of the Court has not been removed by a comprehensive legislative scheme.
[36] The Legislature was in a position to pass legislation within the array of powers provided to it including “property and civil rights in the Province” and “the administration of justice…procedure in civil matters”. The “pith and substance” of the CA is to establish the currency of Canada and regulate its usage and the effect of the legislation is clearly within the s. 91(14) power of the Federal Government. Given the modern focus of overlapping jurisdictions and cooperative federalism, I am satisfied that the Provincial Legislature has the power to enact legislation such as the COEA and the FMCA as part of its ability to control the process of the administration of justice in the Province. I am also satisfied that the Province has not purported to remove the inherent jurisdiction of the Court by a comprehensive scheme.
[37] Having concluded that I have the inherent jurisdiction to grant a judgment to the Plaintiff in Iranian rial, I grant the judgment sought by the Plaintiff in Iranian rial as at the date of these Reasons for Judgment. Having concluded that I also have the inherent jurisdiction to grant a judgment to the Plaintiff in an amount equivalent to the amount of Iranian rial in Canadian currency, in the alternative I grant the judgment sought by the Plaintiff in an amount equivalent to the amount of Iranian rial in Canadian currency as at the date of these Reasons for Judgment. If the parties are not in a position to agree about the amounts, they will be entitled to either make further application or have a reference to the District Registrar to establish the amounts.
[38] If I am found to be incorrect in arriving at the conclusion that the Plaintiff is entitled to a judgment in Irian rial and that s. 1(1) of the FMCA does not apply, then the amount payable by the Defendant will be in accordance with s. 1(1) of the FMCA. First, I would then be satisfied that the order should be made will be “…most truly and exactly compensated if all or part of the money payable under the order is measured in a currency other than the currency of Canada…” so that an order in an amount of Canadian currency should be made. Second, the lack of a chartered bank in British Columbia trading in Iranian rial is clearly a fact at issue in the application of the Plaintiff and I am satisfied that hearsay evidence in this regard is not admissible. The Plaintiff has brought its application under Rule 9–7. Rule 9–7 (5) governs what evidence can be relied upon in such an application. Accordingly, the information provided by both parties that Iranian rial cannot be purchased at a chartered bank located in British Columbia is hearsay and cannot be relied upon in this application. It may or may not be accurate to say that the equivalent amount of Iranian rial cannot be purchased at a chartered bank located in British Columbia. I am not in a position to conclude that this is the case. In any event, I conclude that I have the inherent jurisdiction to make an order in Canadian currency if it is ultimately the case that an equivalent amount of Iranian rial cannot be purchased at a chartered bank located in British Columbia as I conclude that the Legislature did not remove the inherent jurisdiction available to me to still deal with the conversion of Iranian rial to an amount of Canadian currency if I ultimately conclude that Iranian rial cannot be purchased at a chartered bank located in British Columbia.
[39] In this regard, the parties will be entitled to make further application if no chartered bank located in British Columbia is in a position to convenience the purchase of the equivalent amount in Canadian currency of the judgment in Iranian rial but that alternative sources are available to allow the calculation of the conversion of the Iranian Judgment to Canadian funds.
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