It is now easier to enforce an Arizona judgment in Alberta and vice versa. On April 1, 2015, Governor Douglas Ducey of Arizona signed into law Senate Bill 1447 – foreign country money judgments; enforcement (“Arizona Statute”). This law authorizes the enforcement in Arizona of judgments from foreign jurisdictions with reciprocal laws recognizing Arizona judgements. The province of Alberta will be a reciprocating jurisdiction for the purposes of the Arizona Statute as soon as the Lieutenant Governor of Alberta (the Provincial Cabinet) issues an order designating Arizona to be a “reciprocating jurisdiction.” See section 8 of the Reciprocal Enforcement of Judgments Act (“Alberta Statute”).
Once the Province of Alberta has declared Arizona to be a reciprocating jurisdiction under the Alberta Statute, section 12-3252 of the Arizona Statute will automatically apply to Alberta judgments.
Under the Arizona and Alberta Statutes, a judgment against a person in Alberta can now be enforced against that person in Arizona, and a judgment against a person in Arizona can now be enforced against that person in Alberta. To qualify for enforcement in either jurisdiction, a judgment must be final and must grant or deny the recovery of a sum of money. If the judgment qualifies and is recognized by the Courts, it is enforceable in the same manner and to the same extent as a judgment rendered in the reciprocating jurisdiction.
The Arizona legislative briefing notes on the new law conclude that the Arizona Statute “would ultimately lead to better and more financing for business growth opportunities between Arizona lenders and Canadian businesses and consumers in our state.”
The initiative to enact the Arizona Statute was sparked during a visit to Calgary last year by the Mayor of Phoenix. Calgary and Phoenix are sister cities and it became clear to the Arizona thought leaders visiting Alberta that red tape reduction (judicial or regulatory) is in the interest of both Alberta and Arizona citizens.
Miller Thomson played a role in developing the reciprocal legislation to facilitate enforcement for judgment creditors in Alberta and Arizona and as such is well positioned to assist with the legal issues surrounding reciprocal enforcement of foreign judgments.
The Arizona and Alberta Statutes will be of most use to businesses and individuals possessing money judgments against defendants holding assets in the reciprocating jurisdiction. Both tort and contract judgments are covered. However, domestic relations judgments are expressly excluded by both the Arizona and Alberta Statutes.
Some of the most common judgements that will benefit from the reciprocal Statutes include those involving:
- Residential or commercial mortgages and other loan agreements;
- Employment, agency or partnership agreements;
- Real estate or commodity purchase and sale or lease agreements.
As a creditor considers enforcement of a debt in either jurisdiction, there are two important considerations that must be fully investigated:
- The limitation period under which action must be taken in the reciprocating jurisdiction (often two years or less);
- The existence of other statutory or common law means of enforcement that should be commenced on a timely basis to preserve a creditor’s rights.
Finally, it is essential that any business involved in cross border transactions ensure that the contracts relied upon include the following provisions to assist with enforcement:
- Submission to the jurisdiction of the reciprocating jurisdictions;
- Acknowledgment that the parties are doing business in the reciprocating jurisdictions throughout the term of the contracts.