2959-4660 Quebec Inc. v. Honeywell Ltée
ITA-4268-98
Denault J.
7/5/99
6 pp.
Appeal from decision of Morneau P. ordering all monies due or to become due by garnishee to judgment debtor for services rendered and goods sold and delivered in amount of $35,407.02 be seized, assigned and transferred to Her Majesty the Queen to satisfy claim pursuant to Income Tax Act, s. 223, namely sum of $28,812.61 plus interest and costs-Issue turned essentially on scope of second paragraph of new Civil Code of Quebec, art. 1673-Question whether that paragraph had effect, as garnishee argued, of creating new right formerly exercised by counterclaim, which is no longer impediment to retroactivity of judicial compensation to date of claim for compensation rather than to liquidation by judgment-Prothonotary properly refused to set up against judgment debtor compensation only conceptual in nature-Case law and authors in Quebec have long recognized judicial compensation should not be made retroactive to judgment granting it-Paragraph 2 of art. 1673 did not create new right superseding earlier precedents judicial compensation not retroactive-As judicial compensation cannot be retroactive to date of claim and third party will already have exercised rights before judicial compensation can operate, latter can only take priority over garnishee/ applicant-Appeal dismissed-Civil Code of Quebec, S.Q. 1991, c. 64, art. 1673-Income Tax Act, R.S.C., 1985 (5th Supp.), c. 1, s. 223.