Québec – $1 million suretyship ordered for stay of Canadian enforcement pending U.S. annulment

In Lakah v. UBS, 2019 QCCA 1869, the Québec Court of Appeal denied leave to appeal a Superior Court decision ordering an arbitral party, resisting recognition and enforcement in Canada of an award made in the U.S., to post $1 million as suretyship in Canada pending U.S. annulment proceedings.  The Superior Court acknowledged that a stay should be granted only exceptionally “because it impedes one of the key goals of arbitration, which is to avoid protracted litigation”. In the circumstances, the grounds alleged in the U.S. annulment proceedings “appeared serious” on their face and merited a stay of the Canadian recognition and enforcement proceedings but, in light of the $150 million ordered in the challenged arbitral award, a suretyship of $1 million was “relatively modest”.

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