ALBERTA SECURITIES COM'N v. Ryckman

• Decision Date: 07 August 2001
• Docket Number: No. 1 CA-CV 00-0440.,1 CA-CV 00-0440.
• Citation: 200 Ariz. 540,30 P.3d 121
• Parties: The ALBERTA SECURITIES COMMISSION, a Commission of the Province of Alberta, Canada, Plaintiff-Appellee, v. Lawrence G. RYCKMAN and Elaine Ryckman, husband and wife, Defendants-Appellants.
• Court: Arizona Court of Appeals

30 P.3d 121

200 Ariz. 540

The ALBERTA SECURITIES COMMISSION, a Commission of the Province of Alberta, Canada, Plaintiff-Appellee, v. Lawrence G. RYCKMAN and Elaine Ryckman, husband and wife, Defendants-Appellants.

No. -0440.

Court of Appeals of Arizona, Division 1, Department A.

August 7, 2001.

Spiess & Short, P.C. by G. Peter Spiess and D. Michelle Douglas, Phoenix, Attorneys for Defendants-Appellants.

The Cavanagh Law Firm, P.A. by Henry L. Timmerman and Bradley J. Johnston and Christopher Robbins, Phoenix, Attorneys for Plaintiff-Appellee.

OPINION

BERCH, Judge.

¶ 1 Lawrence and Elaine Ryckman appeal from a summary judgment that domesticated a money judgment for investigation expenses entered in the Court of Queen's Bench of the Province of Alberta, Canada, in favor of the Alberta Securities Commission ("ASC"). The Ryckmans present these issues:

1. Whether the trial court erred in granting summary judgment because triable fact issues underlay the question whether the Ryckmans had been denied basic due process rights;

2. Whether the trial court abused its discretion in failing to grant the Ryckmans a 150-day delay in the summary judgment proceedings;and

3. Whether the trial court erred in entering a judgment that was enforceable against Elaine Ryckman's separate property and her share of the Ryckmans' community property.

RELEVANT FACTS AND PROCEDURE

¶ 2 Until January 1997, the Ryckmans were full-time residents of Canada. In January 1997, they established a residence in Scottsdale, Arizona.

¶ 3 In 1995, Lawrence Ryckman was alleged to have manipulated the Alberta securities markets by purchasing and selling publicly traded shares of Westgroup Corporation to artificially boost their prices. ASC investigated these allegations. In May 1995, ASC issued a notice of hearing alleging that Ryckman had committed various violations of the Alberta Securities Act. ASC did not allege that Elaine Ryckman was involved.

¶ 4 Ryckman appeared before ASC on the initial return date of May 25, 1995 and at several case management meetings and other pre-hearing proceedings. ASC provided documents to Ryckman in August 1995 and a list of witnesses and exhibits in November 1995. At a hearing on the charges against Ryckman in January 1996, the ASC hearing panel received testimony and documentary evidence. Ryckman appeared periodically at the hearing through counsel and twice appeared personally.

¶ 5 The hearing panel issued its administrative ruling, finding that Ryckman had engaged in market manipulation, but rejecting other allegations as unproven. ASC's ruling required Ryckman to resign all positions as officer or director of any securities issuer, prohibited him from acting in any such capacity for eighteen years, and required him to cease trading in securities for eighteen years.

¶ 6 ASC filed with the Alberta court a certified order assessing investigative costs of $492,640.14 Can. against Ryckman. This order has the same force and effect as a judgment of the Court of Queen's Bench. Alberta Securities Act § 167.1(5).

¶ 7 One week after filing a notice of appeal to the Alberta Court of Appeal, Ryckman entered a settlement with ASC under which ASC would accept $250,000.00 Can. as full payment for investigative costs, provided Ryckman paid that sum no later than May 16, 1996. On that same day, Ryckman filed a "Notice of Discontinuance of Appeal" with the Alberta Court of Appeal.

¶ 8 Ryckman paid nothing toward the $250,000.00 Can. settlement by May 16, 1996. He paid a total of $7,500.00 Can. later in 1996, and nothing thereafter.

¶ 9 ASC brought this action in Maricopa County Superior Court in March 1999, seeking an Arizona judgment against the Ryckmans on the judgment of the Court of Queen's Bench of Alberta. The trial court granted ASC's motion for summary judgment and denied the Ryckmans' motion for reconsideration. From formal judgment, the Ryckmans timely appeal.

ANALYSIS

A. Standard of Review

¶ 10 We review matters of law and mixed questions of law and fact de novo.In re United States Currency in the Amount of $26,980.00, 193 Ariz. 427, 429, ¶ 5, 973 P.2d 1184, 1186 (App.1998). Summary judgment should be affirmed if the evidence presented by the party opposing the motion has so little probative value that reasonable people could not find in that party's favor. Orme School v. Reeves, 166 Ariz. 301, 309, 802 P.2d 1000, 1008 (1990).

¶ 11 Whether to grant a continuance to allow additional discovery is within the trial court's discretion. See Ariz. R. Civ. P. 56(f); Birth Hope Adoption Agency, Inc. v. Doe, 190 Ariz. 285, 287-88,947 P.2d 859, 861-62 (App.1997). We will not reverse the court's determination absent an abuse of discretion. Birth Hope, 190 Ariz. at 287,947 P.2d at 861. A trial court does not abuse its discretion in denying relief under Rule 56(f) when the evidence that the moving party proposes to discover is immaterial to the issues before the court. See id. at 288,947 P.2d at 862.

B. Recognition of Judgment of Court of Queen's Bench

¶ 12 In the trial court, the Ryckmans opposed recognition of ASC's Canadian judgment based primarily on Lawrence Ryckman's allegations that the Canadian proceedings were unfair and fraught with fraud and prejudice. Ryckman's affidavit alleged the following:

• that ASC's investigation was instigated by powerful government officials in retaliation for Ryckman's complaints about the Province's failure to meet funding commitments to the Calgary Stampeders Football Club, which Ryckman owned;

• that ASC refused to turn over relevant documents to Ryckman during its investigation;

• that during the weeks preceding the ASC hearing set for January 8, 1996, ASC engaged in settlement negotiations with Ryckman, drafted a settlement agreement, and led Ryckman and his attorney to believe that a settlement had been reached and no hearing would be needed, only to withdraw from the settlement negotiations on January 7, 1996, and insist that the hearing go forward, denying all later requests for postponement;

• that ASC's hearing attorney and two of the three members of the hearing panel had serious conflicts of interest;

• that in 1998 Ryckman learned "from a senior investigator with the ASC, who was involved in [the] investigation" that a member of the ASC Hearing Panel had insisted he be on the panel to ensure an outcome against Ryckman, had actively participated in the investigation, and had coached ASC's expert witness on the content of his testimony; and

• that after Ryckman filed his notice of appeal, the Alberta Treasury Branch ("ATB") induced him to withdraw his appeal by telling him that if he settled with ASC, dismissed his appeal, and signed a consent to receivership, ATB would forbear until March 6, 1996 filing involuntary receivership and bankruptcy proceedings against Ryckman Financial Corporation ("RFC") and seizing its files and records; and despite its assurances thereafter seized 165 boxes of files from Ryckman and RFC "in 1996."

¶ 13 Ryckman contends that the trial court erred in determining that principles of comity required recognition of the Canadian judgment. Ryckman cites the decision of this court in Rotary Club of Tucson v. Chaprales Ramos de Pena, 160 Ariz. 362, 364, 773 P.2d 467, 469 (App.1989), for the proposition that a foreign nation's judgment need be recognized only if it resulted from a full and fair trial before an impartial tribunal, and will not be recognized if it results from prejudice, fraud, unfairness, or irregularities in the foreign proceedings. Ryckman urges that the facts he presented through his affidavit in the trial court clearly established that the Canadian legal process in his case was plagued with prejudice, unfairness, and irregularities that denied him even a modicum of due process. Ryckman also contends that his failure to pursue his direct appeal to the Alberta Court of Appeal is irrelevant to whether the Arizona courts should recognize the Alberta judgment.

¶ 14 We do not agree with Ryckman's analysis. In Rotary Club the court declined to recognize a Mexican judgment that was procured through service of process on a Mexican attorney whom the Rotary Club had not authorized to accept service of process on its behalf. We do not view that court's quotation from Restatement (Second) of Conflict of Laws § 98 cmt. c (1971),¹ as Ryckman does, as requiring that Arizona courts must review the proceedings that resulted in a foreign judgment and must decline to recognize the judgment upon the merest suggestion of prejudice or fraud.

¶ 15 Although we respect the general principle that Restatement (Second) of Conflict of Laws § 98 announces, we believe that the more specialized treatment of common law principles affecting recognition of foreign judgments presented in Restatement (Third) of the Foreign Relations Laws of the United States (hereinafter ""Restatement") §§ 481 and 482 (1987) provides a more complete and useful framework for analyzing this appeal. Restatement § 481, entitled "Recognition and Enforcement of Foreign Judgments," creates a strong presumption of the validity of a foreign judgment:

(1) Except as provided in § 482, a final judgment of a court of a foreign state granting or denying recovery of a sum of money ... is conclusive between the parties, and is entitled to recognition in courts in the United States.

¶ 16 The judgment of the Alberta Court of Queen's Bench was a "final judgment" of that court within the meaning of Restatement § 481. Although Ryckman did appeal from the underlying administrative ruling, he later dismissed his appeal and has not commenced a collateral attack on the judgment in Alberta. Accordingly, under Restatement § 481, ASC's Canadian judgment is a final judgment presumptively entitled to recognition in the courts of Arizona unless one of the exceptions in § 482 requires or permits the court to decline to recognize it.

¶ 17 Restatement § 482 creates exceptions to this presumption...