Executive Summary: Key Legal and Evidentiary Issues

• Investors and shareholders of Devas Multimedia Services have spent nearly five years trying to enforce two foreign arbitral awards against the Republic of India in Quebec's Superior Court.
   
• Jurisdictional immunity claims by both India and the mis-en-cause Airports Authority of India produced conflicting outcomes, with India losing its immunity defence while AAI succeeded on the same ground.
   
• Timing became central to the dispute once the Plaintiffs sought to split the proceeding so the claims against India could move forward independently of AAI's pending appeal.
   
• Article 355 of the Code of Civil Procedure was tested by India's argument that an appeal automatically suspends a first-instance proceeding against all parties, not merely the party appealing.
   
• Case management concerns ultimately shaped the outcome when the Court declined to entertain a sprawling preliminary dismissal application and instead referred it to the trial judge.
   
• Quantum under the underlying arbitral awards remains substantial, with tens of millions of dollars in compensation plus contractual costs at stake for the Republic of India.

Facts of the case

Since November 15, 2021, CC/Devas (Mauritius) Ltd., Devas Employees Mauritius Private Limited, and Telcom Devas Mauritius Limited — later continued in the proceeding by CCDM Holdings LLC, Devas Employees Fund US LLC, and Telcom Devas LLC — have sought recognition and enforcement in Quebec of two foreign arbitral awards against the Republic of India. Those awards, rendered by a Permanent Court of Arbitration tribunal under the UNCITRAL Rules, arise from India's annulment of an agreement with Devas Multimedia Services and order India to pay compensation running into tens of millions of U.S. dollars to the Devas investors, along with interest and a contribution toward arbitration costs. The proceeding began with a series of pre-judgment seizures by garnishment against funds held by the International Air Transport Association (IATA) on behalf of Airports Authority of India (AAI) and, briefly, Air India. India initially resisted the recognition proceeding by claiming state immunity under the State Immunity Act, but the Superior Court rejected that defence in December 2022, a ruling the Court of Appeal upheld in December 2024 and the Supreme Court of Canada declined to disturb in September 2025. AAI raised its own immunity claim and succeeded: in August 2024, the Court dismissed the recognition application as against AAI, finding AAI immune under the same statute. The Plaintiffs appealed that ruling, and while the appeal was pending, disagreement arose over whether the case against India could proceed on its own or had to wait for the AAI appeal to be resolved.

Policy and legislative provisions at issue

The dispute turned principally on article 355 of the Code of Civil Procedure, which provides that a duly filed appeal suspends execution of the judgment appealed from, except where provisional execution is ordered or the law otherwise provides. India argued this provision — or some unstated principle behind it — meant that its appeal-related concerns about AAI's status should suspend the entire first-instance proceeding, including the parts that concerned India alone. The Court also considered articles 645 and 654 CCP, which govern homologation and the possible adjournment of proceedings to recognize and enforce arbitral awards, and article 49 CCP, the general provision on a court's discretion to stay a proceeding. On the later application to dismiss part of India's defence, the Court applied articles 51 and 168 CCP, the provisions permitting summary dismissal of a claim or defence that is manifestly unfounded, along with appellate guidance cautioning against using those articles to conduct a "trial within a trial."

Reasoning and analysis

On the splitting and stay applications, the Court found no basis in the text of article 355 CCP for India's position that an appeal automatically halts a first-instance proceeding against parties other than those directly affected by the judgment under appeal. The Court noted that the AAI appeal concerned only the execution of the judgment dismissing the case against AAI, and had no bearing on the separate, independent conclusions sought against India regarding recognition of the arbitral awards themselves. The Court also observed that India's own prior conduct in the litigation — including participating in hearings while other appeals were pending — was inconsistent with its newly asserted position, and that India had previously agreed to a stay only through a specific, negotiated agreement with the Plaintiffs rather than by operation of any automatic rule. Weighing the risk of inconsistent judgments, the Court concluded that hearing the claims against India separately from the AAI-related conclusions posed no meaningful risk of contradiction, since neither India nor AAI had ever suggested AAI played any role in the underlying events giving rise to the arbitral awards. On the later application concerning India's defence, the Court declined to resolve, at a preliminary stage, complex and contested questions of law and fact spanning 143 paragraphs and thousands of pages of exhibits. Citing appellate authority against conducting a "trial within a trial" on summary applications, and the view expressed by a colleague on the Court in a separate case, the Superior Court found it more appropriate to let the trial judge deal with these issues on a complete record.

Ruling and overall outcome

The Court granted the Plaintiffs' application to split the proceeding and dismissed the Republic of India's application to stay it, ordering that Conclusions B, C, D and E of the recognition application — concerning recognition of the two arbitral awards — proceed in a first phase, with the AAI-related conclusions (E.1 and F) reserved for a possible second phase, with costs awarded in favour of the Plaintiffs. In the subsequent decision, the Court declined to rule on the merits of India's grounds of defence at the preliminary dismissal stage and instead referred the Plaintiffs' partial dismissal application to the trial judge who will hear the recognition application on its merits, so that all issues could be resolved together in a single judgment, with costs to follow the outcome of the case. Neither decision awards or denies the underlying monetary compensation sought from India; that issue remains to be determined at the merits hearing on the recognition application.