Foreign Judgments

Foreign
Judgments

of a non-member
of a member state
state

governed by governed by the

Common Law Recast

Situation: Dispute determine by a foreign court. What is the effect of the foreign
judgment in England?

RECOGNITION ENFORCEMENT

positive process
merely provides a whereby English court
barrier which prevents authorises the judgment
proceedings being creditor to take the
pursued in England necessary steps so that
the judgment is satisfied

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 • Sometimes: a litigant in English proceedings might wish to have a foreign
judgment recognised only (as where he wants to raise it as a defence).

• Basis of Recognition and Enforcement:

Foreign Judgments have no direct operation in England, but may still be
recognised and enforced.

• Previously: it was supposed that the basis of enforcement was to be found in the
doctrine of comity.

LATER: This was superseded by the doctrine of obligation:

• Adams v Cape Industries:

Slade LJ: the law is based on ‘an acknowledgment that the society of nations will
work better if some foreign judgments are taken to create rights which superseded
the underlying cause of action, and which may be directly enforced in countries
where D or his assets are to be found’.

• TWO theories:

1. Theory of Obligation:
provided that the foreign court had jurisdiction (according to English conflict of
laws rules), the judgment is conclusive in England, unless there is a defence.

2. Idea of Reciprocity:
the courts of Country X should recognise and enforce the judgments of Country Y
if, mutatis mutandis, the courts of Country Y recognises and enforces the
judgment of Country X.

• Theory of Obligation was accepted by the English courts in the 19th century:
Schibsby v Westenholz.

^ still forms the basis of recognition and enforcement at Common Law.

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 • Recognition and Enforcement of a foreign judgment is a two-stage process:

(i) are the basic conditions for recognition or enforcement satisfied? (onus on
judgment creditor)

(ii) if so, is there a defence by reason of which the foreign judgment should
nevertheless not be recognised or enforced? (onus on judgment debtor)

Recognition and Enforcement at Common Law

(A) Conditions for ENFORCEMENT:

For a judgment to be entitled to enforcement at Common Law, the following conditions

must be satisfied:

(1) the foreign court must have been a court of competent jurisdiction.
(2) the judgment must be final and conclusive.
(3) the judgment must be for a fixed sum of money.

1. a court of competent jurisdiction:

• Buchanan v Rucker:
Foreign court must have jurisdiction according to English rules of private
international law.

• TWO situations in which the original court will be regarded as a court of

competent jurisdiction:

(a) where judgment debtor submitted to the jurisdiction of the foreign court.
(b) where there is a sufficient territorial connection between the judgment
debtor and the country of origin.

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 Competent
Jurisdiction

(a) (b) Territorial

Submission Connection

(ii) voluntary (ii)

(i) consent (i) Individuals
appearance Companies

(iii) invoking Direct Indirect

jurisdiction of the Presence Presence
original court

(a) Submission:

Submission can take one of three forms: Emanuel v Symon.

(i) Consent:

• Foreign court will be considered to be one of competent jurisdiction if the

judgment debtor consented to the jurisdiction of the forum in which the
judgment was obtained: Hubbard.

• Usually takes the form of a contractual clause providing for the exclusive or
non-exclusive jurisdiction of the foreign court: Copin v Adamson.

• Adams v Cape Industries plc:

minimum requirement is a ‘clear indication of consent to the exercise the
foreign court of jurisdiction’: Scott J.

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 (ii) Voluntary Appearance:

• A defendant who voluntarily participates in the foreign proceedings

submits to the jurisdiction of the foreign court.

• The following would amount to submission:

- if D entered an appearance to defend the case.

- if he took any step designed to contest the claim on the merits.
- even if he filed an appeal against the judgment to a higher court in
the country of origin, not previously having taken any steps in the action:
Sun & Sand Agencies.

• HOWEVER:
It must be shown that the judgment debtor took part in the foreign
proceedings in a way accepted by English law as amounting to a voluntary
appearance: Roch LJ in Hill.

• Adams v Cape Industries:

if D submits to proceedings brought by C1 in a foreign country, this is not
an implied submission to related proceedings commenced by C2 in the
same court, even if both proceedings involve almost identical issues.

• HOWEVER:
where D submits in foreign proceedings by C1, D’s submission to foreign
court’s jurisdiction extends not only to further claims concerning the same
subject matter, but also to claims which are connected or related to the
original claim.

• S. 33(1) of Civil Jurisdiction and Judgment Act 1982: if appears for any of
the following reasons, it will not amount to submission:

(a) to contest the jurisdiction of the court.

(b) to ask the court to dismiss or to stay the proceedings on the
ground that the dispute in question should be submitted to arbitration or the
determination of the courts of another country.
(c) to protect, or obtain the release of property seized or threatened
with seizure in the proceedings.

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 • Appearance must be voluntary (to be determined by English law): duress or
undue influence does not amount to voluntary appearance: Israel Discount
Bank of New York v Hadjipateras.

(iii) Invoking the Jurisdiction of the original court:

Judgment debtor will be held to have submitted to the jurisdiction of a
foreign court if he took part in the proceedings as C. Will also be
considered to have submitted to any counter-claim.

(b) A Sufficient Territorial Connection:

(i) Individuals:

• the foreign court has jurisdiction over an individual defendant if they are
resident within the foreign country [Emanuel v Symon] or present within
the foreign country [Carrick v Hancock].

• if D is not only resident in the country of origin but also present there when
proceedings are commenced, foreign court will be considered to be a court
of competent jurisdiction: Adams v Cape Industries.

(ii) Companies:
Instead of applying the economic presence test, the court applies a more physical
test based on the notion of a place of business.

Direct Presence:

• Slade LJ in Adams v Cape Industries:

A company has direct presence in the country of origin if: ‘it has
established and maintained at its own expense (whether as owner or lessee)
a fixed place of business of its own in the other country & for more than a
minimal period of time has carried on its own business at or from such
premises by its servants or agents’.

• Merely carrying on business in a foreign country is not enough; must have

a place of business there: FW Millington.

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 Indirect Presence:

• Adams v Cape Industries:

A company is indirectly present in a foreign country only if a
representative of the company has for more than a minimal period of time
been carrying on the company’s business in the other country at or from
some fixed place of business.

• Company will not be considered to be present if the representative is

unable to contract on behalf of it: Vogel.

• No concept of forum conveniens for cases concerning foreign judgments:

Borchers (1992): traditional rules display ‘the twin vices of… exorbitant
national jurisdiction rules, and extremely narrow judgment recognition
practices’.

2. final and conclusive judgment:

• Judgment must conclusively and permanently decide the matter between

the parties; whether it does so or not will be determined by reference to the
law of the country of origin: Berezovsky.

• As long as the decision of the foreign court is not provisional or subject to

revision, it will be regarded as final and conclusive: Hill.

• The fact that a judgment is subject to appeal in the country of origin doesn’t
mean it’s not final and conclusive, although in such a case the English court
might stay enforcement proceedings pending the outcome of the appeal:
Sarlie (No.2).

3. for a fixed sum of money:

• at Common Law: can’t enforce a foreign order for specific performance or

injunction.
• General Rule: if D is ordered to pay a sum of money to a private person,
judgment = enforceable (even if damages = exemplary or punitive: Sun &
Sand Agencies).

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(B) Conditions for RECOGNITON:

There are four conditions for the recognition of a foreign judgment:

(1) the foreign court must have been a court of competent jurisdiction.
(2) the judgment must be final and conclusive.
(3) the judgment must be on the merit.
(4) foreign proceedings must have been between the same parties and have
involved the same cause of action or the same issue.

^ where satisfied, the foreign judgment is prima facie entitled to recognition unless the
other party can establish one of the defences.

• If recognised, the foreign judgment establishes either a cause of action estoppel or

an issue estoppel.

• Three types of situations in which recognition of a foreign judgment may arise:

(i) foreign judgment as a defence to English proceedings involving the

same issue/cause of action.

(ii) D may seek to rely on a foreign judgment where given in C’s favour
to stop C from bringing proceedings in England:

S.34 of CJJA 1982: if C has already had a foreign judgment in his

favour, can’t bring a proceedings in England on the same case unless
the foreign judgment is not enforceable or entitled to recognition in
England.

HOWEVER: not mandatory:

Republic of India v India Steamship:

HL: S.34 merely provides D with a defence which may be defeated
by estoppel, waiver or contrary agreement.

(iii) judgment creditor may wish to raise issue estoppel as a means of

limiting the grounds on which the judgment debtor may challenge
enforcement of a foreign judgment in England.

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 (3) on the merits:
• S.3 of FLPA 1984: where the foreign court dismisses an action on the
ground that it is time-barred, the action is deemed to have been determined
on its merits.

• Lord Brandon in The Sennar (No.2):

‘a decision on the merits is a decision which establishes certain facts proved
or not in dispute, states what are the relevant principles of law applicable to
such facts, & expresses a conclusion with regard to the effect of applying
those principles to the factual situation concerned.

(4) cause of action and issue estoppel:

where C is where, although the cause of action

prevented is different, C is estopped from
from suing contending that a particular issue
on the same should be decided differently from
claim the way the identical issue was
decided in an earlier case

In both forms:
(a) parties to foreign proceedings and English proceedings must be same.
(b) cause of action (or issue) in English proceedings must be the same as
was determined by the foreign court.

Identity of the Parties:

• A cause of action estoppel is effective against the same parties as well as

the parties’ privies (two parties are in a relationship of privity if there is
privity of blood, title or interest: Keeler Ltd (No.2).

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 Identity of the Cause of Action:

• a litigant should be prevented from asserting or denying, as against the

other party, the existence of a particular cause of action, the non-existence
or existence of which has been determined by a court of competent
jurisdiction in previous litigation between the same parties: Thoday v
Thoday.

• Letong v Cooper:
a cause of action consists of the minimum facts which C has to plead and
(if necessary) prove in order to obtain the relief claimed.

Identity of the Issue:

• General Rule:
once an issue has been determined between the parties, neither party is
allowed to fight that issue all over again: Fidelitas Shipping Co.

BUT:
the issue determined by foreign court must be identical to the issue raised
in the English proceedings: Yukos Capital.

• Keeler Ltd (No.2):

issue estoppel may be relied upon only if the determination of the issue by
the foreign court was necessary for its decision.

(difficult to see ^, so, courts tend to be cautious).

(C) DEFENCES to Recognition and Enforcement:

Even if the requirements in the first stage are fulfilled, an English court may still refuse to
recognise or enforce the judgment if a defence is established.

General Rules:
• it is not possible to raise at the recognition or enforcement stage defences
which were raised, or could have been raised, in the foreign proceedings:
Hadjipateras.

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 • it is not a defence to recognition or enforcement that the judgment was
wrong on the merits; whether on the facts or the law. It is even immaterial
that the foreign court misapplied English law in reaching its decision:
Godard v Gray.

• if a foreign court makes a mistake as to its own jurisdiction, so that it hears

a case when it had no jurisdiction to do so, an English court will not enforce
its judgment: Papadopoulos.

• if the foreign court has erred in its own rules of procedure, the English
court will still enforce its judgment: Pemberton v Hughes.

1. Fraud:

• English court won’t recognise or enforce a judgment which was obtained

by fraud.

• Covers:

- presentation of evidence that the other party knew was false.

- where litigant was deprived of the opportunity to take part in the foreign
proceedings either by a trick of the other party (Papelier) or as a result of
the threats of violence (Patel).
- fraud by foreign court: court is prepared to investigate allegations of fraud
in this third category even if the allegations raise potentially sensitive
political or diplomatic issue: Korea NIC.

• Abouloff v Oppenheimer & Co:

D is entitled in the English proceedings to establish the fraud in the original
proceedings even if the allegations of fraud were considered and rejected by
the foreign court.

• Syal v Heyward:
defence of fraud may be invoked in English proceedings even if D
(deliberately) failed to raise the issue in the foreign proceedings when he
could have done so.

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 Circumstances in which FRAUD cannot be raised:

• if it amounts to misuse of process. If already determined abroad, there

must at least be plausible evidence disclosing a prima facie case of
fraud: Owen Banks.

• where there have been separate proceedings abroad leading to a

judgment which creates an issue estoppel on the question of fraud:
Waite.

2. (Contrary to English) Public Policy:

• not contrary to public policy to enforce a foreign judgment which orders D

to pay exemplary damages [Sun & Sand Agencies] OR to enforce a foreign
judgment ordering a payment of a gambling debt [Burswood Nominees
Ltd].

• Following will be contrary to public policy:

- if recognition or enforcement leads to a breach of D’s rights under ECHR:

Al-Bassam v Al-Bassam.
- undue influence, duress or coercion: Hadjipateras.
- didn’t enforce foreign judgment because entitled child to receive
maintenance even after her minority: Re Macarthey.

3. A breach of A.6 of ECHR:

• Drozd & Janousek:

an ECHR contracting state may incur responsibility if it assists in the
enforcement of a foreign judgment obtained in flagrant breach of A.6.

4. Revenue, Penal or other Public Laws:

• English courts won’t enforce the foreign revenue, penal or other public
laws either directly or through the recognition of a foreign judgment:
USA v Inkley.

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 5. Natural Justice:

• Jacobson v Frachon:
Natural justice requires:

(a) litigant must have been given notice of the foreign proceedings.
(b) litigant must be given a proper opportunity of presenting his case before
the court.

(^ to be determined according to English law).

• Pemberton v Hughes:
A foreign judgment won’t be recognised or enforced if the original
proceedings ‘offend against English views of substantial justice’.

6. Multiple Damages:

• S.5(2) of PTIA 1980: a court in UK cannot enforce a judgment for multiple

damages.

^ targets US anti-trust laws.

• Lewis v Elliades:
The prohibition applies to all the judgment, not just its non-compensatory
parts.

BUT, if a foreign court gives a composite judgment with both a multiplied

award and ordinarily compensatory damages, it is possible to separate the
different parts and enforce the latter but not the former.

7. Matter previously determined by English court (conflicting judgments):

• a prior English judgment is a defence not only to subsequent English

proceedings, but also to the recognition or enforcement of a subsequent
foreign judgment: Vervaeke v Smith.

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 8. Matter previously determined by another foreign court:

• if there are two conflicting foreign judgments, both of which satisfy the
conditions for recognition or enforcement, the earlier judgment will prevail,
UNLESS the circumstances are such that the party wishing to rely on the
earlier judgment is estopped from doing so: Showlag v Mansour.

9. Foreign judgment in breach of an Arbitration Agreement of Jurisdiction Clause

(S.32 of CJJA 1982):

• S,32 CJJA 1982: if C sues in a foreign country in breach of an exclusive

jurisdiction clause or arbitration agreement, the ensuing judgment shall
normally be refused recognition or enforcement.

HOWEVER: it won’t provide a defence if it was void, illegal or unenforceable

or incapable of being performed: S.32(2).
• D also can’t rely on the arbitration agreement or the jurisdiction clause if
the proceedings in the original court were brought with his agreement or if
he counter-claimed in the proceedings or otherwise submitted to the
jurisdiction: Mark, Rich and Co.

• English court is entitled to decide, according to its own conflict of laws

rules, whether or not the alleged clause was void or D submitted.

• Tracomin SA v Sudan Oil Seeds

• Judgments INVALID under the foreign law:

General Rule:
A judgment that has been set aside in the country of origin will not be
recognised or enforced in England.

- if the foreign judgment is void under the foreign law, cannot be

recognised or enforced in England.
- if the foreign judgment is merely voidable under the foreign law, being
valid unless & until it is set aside, it will be recognised or enforced: Sun &
Sand Agencies Ltd.

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 Recognition and Enforcement under the Recast

• As regards matters within the scope of A.1 of the Recast, Chapter III applies to
judgments given by the courts of EU member states.

• Recast is directly effective in England – its fundamental principle is to facilitate

the free movement of judgments between the EU member states and so,
harmonisation of jurisdiction rules is a means to this end.

• Chapter III is build on the principle of mutual trust between the courts of the
member states (if recognised under the Recast, it should be treated as if it was
given by the registered UK court).

(A) Conditions:

1. The judgment must be given by a court of a member states:

• A.2(a): ‘any judgment given by a court or tribunal of a member state,

whatever the judgment may be called, including a decree, order, decision
or writ of execution’.

^ covers ANY judicial decision which was (or was capable of being) the
subject of an enquiry in contested proceedings in the court of origin
[Denilauter], including judgments by consents [Mareq].

• Chapter III applies only to international recognition.

• need not be final & conclusive OR a fixed sum of money. So, a decree of
specific performance and injunction is enforceable.

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 2. The judgment must fall within the scope of the Recast:
(so, must relate to ‘civil and commercial matters’)

• West Tankers:
where a member state court grants a judgment on the merits,
notwithstanding D’s allegation that there is a binding arbitration agreement
between the parties, the judgment does not concern arbitration (and so, falls
within the scope).

^ retained by the Recast without amendment.

3. The basis of jurisdiction in the original proceedings doesn’t matter:

(it doesn’t matter the judgment was given by a member state court exercising
exorbitant jurisdiction).

• irrelevant that the original court assumed jurisdiction under Recast or its
traditional rules.

(B) RECOGNITION:

• if falls within the scope of the Recast, A.36(1): shall be recognised in the
other member state without any special procedure being required.

• all the person relying on the foreign judgment need do is produce a copy of
it and a formal certificate issued by the court of origin (A.37(1)), to obtain
recognition.

• Samskip GmbH:
if the court of one member state has ruled that the jurisdiction clause was
valid, it would be contrary to the principle of mutual trust to allow the
courts of another member state to review the same question.

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(C) ENFORCEMENT:

• need not be final and conclusive or for a fixed sum of money.

• a judgment must, however, be enforceable in the court of origin: A.39.

• Procedure:

(i) C makes an application for enforcement, provides a copy of judgment and

certificate that certifies that it is enforceable in the court of origin. Certificate
must be served on the judgment debtor.

(ii) judgment debtor may apply to the court for a decision refusing enforcement
on the basis of one or more of the defences listed in A.45 (in England, happens at
the High Court).

(iii) court’s decision to enforce or refuse enforcement is subject to appeal (in

England, at High Court).

(iv) further appeal possible against the third-stage appeal (in England, happens at
the Court of Appeal).

• Wolf:

A C who obtains a judgment in another member state may enforce it in

England only through this procedure; can’t choose to bring an action on the
judgment at common law.

(D) Defences to Recognition and Enforcement:

• A.52: Under no circumstances may a foreign judgment falling within Chapter III
be reviewed as to its substance.

• defences exhaustively set out in A.45.

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 • if the judgment is being challenged in legal proceedings in the member state of
origin, recognition or proceedings for the enforcement of the judgment in another
member state may be stayed.

• General Rule:
defence is mandatory; ie: if established, recognition or enforcement must be
refused.

• Limited review of jurisdiction:

- The court addressed is not normally entitled to question whether the original
court was justified in assuming jurisdiction (even the test of public policy may
not be applied to the rules relating to jurisdiction: A.45(3): Krombach).

- General Rule: jurisdiction of the original court may not be reviewed:

Exceptions:

(a) jurisdiction of the foreign court may only be investigated by English court if
the case relates to insurance, consumer contracts, or employment contracts, and
D was the weaker party.

(b) a judgment shall be refused recognition or enforcement if the assumption of

jurisdiction by the original court was contrary to the provisions relating to
exclusive jurisdiction (A.24).

Defences laid down exhaustively in A.45:

1. Judgment is manifestly contrary to public policy: A.45(1)(a):

• it is not for the Court of Justice to define public policy; it is a question for the
law of each of the member states.

• Court of Justice: public policy is a concept which should be given a restricted

interpretation [Boch] & should be invoked in only exceptional cases [Hoffman
v Krieg].

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 • can't rely on public policy simply because court of origin applied a different law
or because the court addressed considers that court of origin failed to determine
the facts of the case accurately: Lithuanian Airlines v Riga.

• unless recognition of the foreign judgment is a breach of a fundamental

principle of a rule of law regarded as essential in the legal order of the state
addressed, recognition cannot be refused on the basis of public policy:
Krombach v Bamberski.

• Maxicar SpA: the fact that the court of origin made a mistake in the application
of EU law is not enough to justify non-recognition of the judgment.

• Trade Agency Ltd: public policy is engaged if the court of origin failed to give
adequate reasons for its decisions because otherwise, incompatible with A.6 of
ECHR.

• also engaged if law of state of origin has failed to prevent a manifest breach of
D’s rights under ECHR: Krombach.

• a foreign judgment which has been obtained by fraud may be refused

recognition or enforcement on the ground of public policy (BUT, cannot be
reviewed as to its merits: A.52).

• Interdesco SA v Nullifire Ltd:

Phillips J:

(i) where foreign court has ruled on precisely the matters which D seeks to raise
when challenging the judgment, the court is not entitled to review the
conclusion of the foreign court.

(ii) D who believes that foreign judgment has been obtained by fraud should
pursue any available remedy in the court of origin.

(iii) English court should not generally entertain a challenge to judgment in

circumstances where it would not permit a challenge to an English judgment.

So, extremely rare.

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 2. Natural Justice: A.45(1)(b):

• judgment shall not be recognised ‘where it was given in default of appearance,

if D was not served with the documents which institute the proceedings or with
an equivalent document in sufficient time & in such a way as to enable him to
arrange his defence, unless D failed to commence proceedings to challenge the
judgment when it was possible for him to do so’.

• can’t rely on it if D took any part in the proceedings (even if to contest

jurisdiction or ask for a stay it seems: de Haan).

HOWEVER:

if proceedings against D were initiated without his knowledge & a lawyer

appeared on his behalf, but without his authority: in default of appearance
[Court of Justice in Magenta Druck].

• potentially available only if D was not served with the originating process
(question of substance, not form: Reeve v Plummer).

• a mere formal irregularity in the service procedure will not debar recognition or
enforcement if it has not prevented D from arranging his defence.

HOWEVER: D must have been served: Tsavliris.

• can rely on it even if already considered by the court of origin.

3. Irreconcilable judgments: A.45(1)(c):

• a judgment shall not be recognised if it is irreconcilable with a judgment given

in a dispute between the same parties in the state in which recognition is sought.

^ will be irreconcilable if they entail legal consequences that are mutually

exclusive: Hoffman v Krieg.

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 • A.45(1)(d): deals with two foreign judgments:
English courts shall not recognise a judgment if it is irreconcilable with an
earlier judgment given in a member state or a third state involving the same
cause of action and between the same parties, provided that the earlier judgment
fulfills the conditions necessary for its recognition under English law.

➔ UK Judgments:

• CJJA: provision made for recognition and enforcement in part of UK of

judgments obtained in another part. No jurisdiction requirements need to be
satisfied in respect of proceedings in the original court. Enforcement is not
confined to money judgments.

• defences of fraud, natural justice and public policy don’t apply to judgments
given in other parts of UK.

• a judgment of the courts of Scotland or Northern Ireland cannot be offered

in England if it conflicts with English judgments.

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