Dutil, Cotnam, Moore

Appeal from a judgment of the Superior Court dismissing an application for declaratory judgment. Dismissed.

By default judgment, the appellant, the Mohawk Council of Kanesatake, was ordered to pay almost $700,000 in professional fees to the respondents. The trial judge found that three seizures in the hands of third persons annulled by judgment did not interrupt the prescriptive period, but that the notice of execution that was filed and served in order to seize any asset belonging to the appellant did. It was deemed to be an unsuccessful seizure, which cannot be equated with a dismissed application within the meaning of article 2894 of the Civil Code of Quebec (S.Q. 1991, c. 64) (C.C.Q.).

The judge did not err in finding that the seizures in the hands of third persons did not interrupt prescription. In view of the releases issued in respect of these seizures and their subsequent annulment by consent of the parties, the judge correctly held that those applications were dismissed and therefore did not interrupt prescription.

As for the notice of execution concerning the appellant, in the special circumstances of this case, the situation should be considered as an unsuccessful seizure, which interrupted prescription as the respondents clearly expressed their intention to obtain payment of the sums owed to them by the appellant. Service of this notice was sufficient to interrupt prescription, and the bailiff was not required to record minutes stating that the seizure was unsuccessful owing to the absence of seizable assets. Indeed, article 707 of the Code of Civil Procedure (CQLR, c. C-25.01) provides that the bailiff must record minutes describing the property seized when assets belonging to the debtor are placed under judicial control. Moreover, although the appellant argued that the absence of minutes prevented it from seeking annulment of the seizure application, that situation arose instead from the fact that the bailiff did not seize any of the assets that were exempt from seizure.

Last, the judge correctly held that the recording of the debts incurred as a result of the judgments in the appellant’s financial statements did not constitute an acknowledgment of a right within the meaning of article 2898 C.C.Q. The respondents’ right to the amounts owed had already been recognized by judgment. Furthermore, the appellant was required to record this debt in its financial statements in order to comply with the applicable accounting standards and principles. It cannot be said, under these circumstances, that this information was included in the financial statements with the clear intent of renouncing the benefit of the elapsed prescriptive period.

Text of the decision: http://citoyens.soquij.qc.ca