Case of the Day: Van Damme v. Gelber

The case of the day is Van Damme v. Gelber, 2013 ONCA 388. Thanks to friend-of-Letters-Blogatory Antonin Pribetić for bringing it to light at the Trial Warrior Blog.

Nahum Gelber was a Canadian national living in Monaco. Alexandre Van Damme claimed that he had a contract with Gelber to purchase a painting Gelber owned. But Gelber refused to deliver the painting and argued that the person who purported to enter into the contract on his behalf lacked authority.

The contract had an exclusive New York choice of forum clause. Van Damme sued for specific performance in the New York Supreme Court. He also sought an order from the Ontario Superior Court of Justice prohibiting the sale or movement of the painting from its location Gelber’s son’s home in Toronto, pending the outcome of the New York case. Gelber, in opposing the Ontario application, argued that Ontario was forum non conveniens, and that “New York is the more appropriate forum.” The parties entered into a consent order in Ontario, which stated that the order was without prejudice to arguments either party wished to make contesting the jurisdiction of the New York courts.

Gelber then moved to dismiss the New York action for want of jurisdiction, arguing that because he was not a party to the contract, he was not bound by the choice of court clause, and thus that the contract did not vest the New York court with jurisdiction. The court deferred a decision, and so Gelber answered the complaint and filed a cross-claim against his supposed agent. The parties conducted discovery, and they then cross-moved for summary judgment. Gelber argued both the jurisdictional point and the substantive points. For example, he argued that the contract was void for lack of mutuality of obligation, that Van Damme had abandoned the contract, and that Van Damme had failed to perform his own obligations under the contract. The judge granted Van Damme’s motion and denied Gelber’s motion, finding that Gelber was indeed a party to the contract. Gelber sought a rehearing and appealed, but the case was finally resolved by a final judgment. Van Damme then sought recognition and enforcement in Ontario, which he received, and Gelber appealed.

The main question was whether, by litigating issues other than the issue of personal jurisdiction in New York, Gelber had, as the Canadians say, attorned to the jurisdiction of the New York court. The answer was yes. I am not going to delve into why the answer was yes—I will leave that to the Canadians—but it is worth noting that the principle is the same in American law. Under Section 5(a)(2) of the UFCMJRA, a court may not refuse to recognize or enforce a foreign money judgment on personal jurisdictional grounds if the defendant appeared voluntarily in the proceeding, other than for the purpose of contesting jurisdiction. (Of course, this was a judgment for specific performance, not for damages, so the statute would not, strictly speaking, apply). Gelber’s argument that specific performance was not an appropriate remedy was waived, but in any case the appellate court thought specific performance was an appropriate remedy under Canadian law in the circumstances of the case.

When I read the facts, and particularly the bit about forum non conveniens, I was hoping for a test of my thesis that there should be some sort of estoppel to prevent a party from arguing forum non conveniens in country A and then opposing recognition and enforcement of the judgment from country B. No such luck!

About Ted Folkman

Ted Folkman is a shareholder with Murphy & King, a Boston law firm, where he has a complex business litigation practice. He is the author of International Judicial Assistance (MCLE 2d ed. 2016), a nuts-and-bolts guide to international judicial assistance issues, and of the chapter on service of process in the ABA's forthcoming treatise on International Aspects of US Litigation, and he is the publisher of Letters Blogatory, the Web's first blog devoted to international judicial assistance, which the ABA recognized as one of the best 100 legal blogs in 2012, 2014, and 2015.

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