Someone recently bought our

students are currently browsing our notes.

X

Enforcement And Recognition Notes

Law Notes > Conflict of Laws Notes

This is an extract of our Enforcement And Recognition document, which we sell as part of our Conflict of Laws Notes collection written by the top tier of Oxford students.

The following is a more accessble plain text extract of the PDF sample above, taken from our Conflict of Laws Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

ENFORCEMENT AND RECOGNITION
Enforcement = e.g. A sues B in Germany for breach of contract and obtains a judgment for $5000 in damages; A
wishes to seize B's property and/or garnishee B's bank account which are in England.
Recognition = treating the claim which was adjudicated as having been determined once for all. The matter is res judicata, both in relation to the entire causes of action and on discrete issues.
 Not every foreign judgment ('FJ') which is recognised in England can be enforced. But to be enforced, a FJ must first be recognised.

Stage 1: Which regime applies?
3 broad categories (depending on the country where the judgment was obtained):
(1) Brussels regime: Judgments covered by BIRR—i.e. judgment from other parts of UK, other BIRR states, and
EFTA states covered by Lugano Convention—are easiest to enforce.
(2) Common law: These are hardest to enforce.
(3) Bilateral treaty: Judgments from a small number of states which are party to a bilateral treaty with the UK and from other territories of the Commonwealth and Empire (i.e. a reciprocal regime) for which the statutory conditions for recognition & enforcement reflect the common law, but which benefit from a simplified procedure for enforcement—i.e. same substantive rules but easier procedural enforcement.
(4) Hague Conventions 2005 and 2019: The rules introduced in these conventions may well also become increasingly important.

Facing a recognition PQ:

Stage 2a: Not BIRR state → Recognition at common law
APPLY: 3 conditions for recognition, Carl Zeiss v Rayner (No.2) [1967]:

1. The issue before the English court must be identical with that determined by the foreign court.
 Yukos Capital v Roseneft (CA)—public policy:
o FACTS: Sought issue estoppel. An arbitration award had been given in favour of one party. The award was annulled in a Russian court. When party sought to enforce the award in Netherlands court, Netherlands refused to recognise the Russian annulment judgment because it was in breach of Dutch public policy. When brought before English court, was there an issue estoppel because the Dutch court had already decided on the recognition of the Russian judgment?
o HELD: No preclusive effect on grounds of issue estoppel, because different issues: Dutch court held it was in breach of Dutch public policy. English court had to decide if it was in breach of
English public policy, which might be different.

2. The foreign decision must be final and on the merits.

3. The parties or their privies must be identical.
(NB Three situations in which recognition may arise:
 D successful in foreign proceedings can rely on a foreign judgment as a defence to English proceedings.
 D relies on a foreign judgment given in the claimant's favour. s.34 CJJA1982 provides that no proceedings may be brought by a person in England on a cause of action in respect of which a judgment has been given in his favour in proceedings between the same parties in a foreign court unless that judgment is not enforceable or entitled to recognition in England.
 Judgment-creditor (or the winner in relation to a particular issue) raises an issue estoppel:
o as a means of limiting the grounds on which the judgment-debtor can challenge enforcement of a foreign judgment in England: Desert Sun Loan Corpn v Hill [1996]
o as incontrovertible evidence e.g. that the contract was binding on B.)

Facing an enforcement PQ:
1 Stage 2a: Not BIRR state → Enforcement at common law
PRELIMINARY STEP
(a) Procedure for enforcement: CPR 24.2(1). Procedurally, absent reciprocal registration 1, a foreign judgment debt is enforced by an application for summary judgment, using the foreign judgment as evidence of the debt.
(b) Establish jurisdiction of the English court:
a. Service IN England: Regular service rules apply (see Jurisdiction at Common Law notes)
b. Service OUT of England (where D is abroad): Practice Direction 6B 3.1(10)
 D has assets in England: Can serve
 D has no assets in England: Probably can serve: Tasarruf v Demirel (CA): Anthony Clarke MR
pointed out that PD 6B 3.1(1) says nothing about D needing to have assets, so long as there is
'indirect benefit': in that case, D was continuously shifting assets about so they might have come through England at some point. Briggs (2015) would agree, as there is nothing in the wording of the directions precluding enforcement where D has no assets.
o Nevertheless, CA emphasised in Demirel that the rule is discretionary and the court would only grant permission for service out if it was just to do so.
o In exercising that discretion, the court might follow Stanley Burnton LJ's slant in Linsen v
Humpuss (CA), construing PD 6B 3.1.(10) as having the object of '[enabling] enforcement of a judgment against assets within this country that belong to a defendant who is out of the jurisdiction', and therefore decline to grant service out.
STEP 1: Enforceable type?

1. A final and conclusive judgment a. Final = It cannot be reopened in the court which made the ruling, even though it may be subject to an appeal in a higher court (Colt Industries v Sarlie (No.2))—although the English court might stay enofrcement proceedings pending outcome of the appeal.
b. Conclusive = It represents the court's settled conclusion on the merits of the point adjudicated.
 May be a whole dispute or a single point
 Both substantive and procedural issues: The Sennar (No.2): Applicability of a jurisdiction agreement can be a decision on the merits if it establishes certain facts, states the law, and expresses a conclusion applying those principles.
 Not if the court establishes only a good arguable case: Desert Sun Loan Corp v Hill

2. of a court a. Does not include: award of an arbitral tribunal; decision of an administrative body b. Probably includes a court applying a religious law: Midland International v al-Sudairy (Saudi court applying Sharia law)

3. for a fixed debt or sum of money: Sadler v Robins a. Non-money judgments (e.g. declaration of liability, order to account, specific performance order) may be recognised but cannot be enforced. This is because the mechanism for enforcement in those other types of judgments will be more complicated—have to take account of background factors etc.
b. 'Fixed'; If the judgment can be varied at all (e.g. through deduction of costs or taxation), then not enforceable.
2 reasons for confining to fixed debt/sum of money:
 Practical difficulty: Non-monetary awards like (e.g. order for account) do not impose simple or straightforward obligations.
 Principle reason: What is done at common law is to bring a claim in debt on the basis of the foreign obligation. There is no such thing as 'enforcement' per se at CL
Cf. Canada's position in Pro Swing v Elta Golf (SCC), enforces non-monetary judgments
 FACTS: An order for account. In England this would be unenforceable.
 HELD: Enforceable. The needs of commerce (and of combatting international fraud) means there must be an effective remedy as a prompt reaction. The limitation did not sufficiently facilitate international transactions. Also comity.
 Nevertheless, on the facts, the court refused to enforce this particular judgment because (a) the result of breaching the order would be contempt of court (i.e. a quasi-criminal judgment, a field that 1

i.e. pursuant to the statutory registration schemes which mirror the common law rules (Administration of Justice Act 1920 and
Foreign Judgments (Reciprocal Enforcement) Act 1933), which are not in syllabus.

2 the court was not willing to enter), and (b) the scope was too uncertain: the question of what the duty to account required was too uncertain.
 However, the SC emphasised that second reason less strongly: on the facts it was quite easy—and is generally easy nowadays—to just apply the calculation of the sum set out in the FJ (e.g. if it is a %
of profits).

4. Not directly or indirectly for tax, penalty, or other public law (e.g. crime, tax collection): This would directly or indirectly enforce another country's public law a. E.g. USA v Inkley: CA refused to enforce a judgment granted in Florida relating to a bail appearance bond, where the purpose of the enforcement action was the execution of a foreign public law/penal process, i.e. part of the criminal process.
b. English law determines whether penal, revenue or other public law, looking at substance not form (SA
Consortium).
i. Public penalty: If paid to other party, not penal: SA Consortium v Sun and Sand
 FACTS: French court added a 'punitive element' for D's 'resistance abusive' (unjustifiable opposition), i.e. if D refuses to pay within a certain time, then he is charged more.
 HELD (CA): (1) It is for the English court to decide whether penal. (2) Look at substance,
not form: it does not matter if the French label stated 'punitive'. (3) Key criterion: If the sum is paid to the state → penal. If the sum is paid to the other side in the proceedings → not penal. On the facts, the sum was paid to the other party, therefore not penal.
ii. Form of proceedings not conclusive: US Securities and Exchange v Manterfield
 FACTS: Action in the US was brought by US regulatory authorities in criminal proceedings.
 HELD: Although there were some criminal charges involved, the order to return disgorged funds to injured investors was a restitutionary claim that could be severed and enforced—it was the substance of what was sought to be enforced which was important.
If satisfied → It is an enforcetable type of judgment.

STEP 2: Jurisdiction? Is the judgment-granting court one with internationally competent 'jurisdiction'? Helpful summaries:
 Emanuel v Symon: 5 cases in which English courts will enforce a foreign judgment: '(1) where D is a subject of the foreign country in which the judgment has been obtained; (2) where D was resident in the foreign country when the action began; (3) where D in the character of plaintiff has selected the forum in which he is afterwards sued; (4) where D has voluntarily appeared; and (5) where D has contracted to submit himself to the forum in which the judgment is obtained.'
 Rubin v Eurofinance SA (SC): Cited with approval that 'a court of a foreign country outside the UK has jurisdiction to give a judgment in personam capable of enforcement or recognition as against the person against whom it was given in the following cases: (1) If the person against whom the judgment was given was, at the time the proceedings were instituted, present in the foreign country. (2) If the person against whom the judgment was given was claimant, or counterclaimed, in the proceedings in the foreign court. (3) If the person against whom the judgment was given submitted to the jurisdiction of that court by voluntarily appearing in the proceedings. (4) If the person against whom the judgment was given had before the commencement of the proceedings agreed, in respect of the subject matter of the proceedings, to submit to the jurisdiction of that court or of the courts of that country.'
The foreign court's competent jurisdiction provides the legal basis for enforcement. Since a court of competent jurisdiction has adjudicated a debt to be due from D to C, the English court will enforce payment through an action of debt (Lord Collins in Rubin v Eurofinance (SC)).
 Accordingly, the foreign court's jurisdiction is determined according to English and not foreign rules, since the rationale is that the English court is enforcing an 'internationally recognised' right. The English courts' view on jurisdiction constitutes its view on what makes a right internationally recognisable.

1. Sufficient territorial connection:
a. Individuals: Residence or presence, when proceedings are commenced?
i. D's temporary physical presence (even without residence) when the proceedings are commenced, is probably sufficient: Adams v Cape Industries (CA): 'So long as he remains physically present in that country, he has the benefit of its laws and must take the rough with the smooth, by accepting his amenability to the process of its courts. In the absence of authority compelling a country conclusion, we would conclude that the voluntary presence of an individual in a foreign country, whether permanent or temporary and whether or not accompanied by 3 residence, is sufficient to give the courts of that country territorial jurisdiction over him under our rules of private international law.' (On the facts, held that D were neither present within the US
nor had they submitted to its jurisdiction.)
ii. Position is unclear if D is resident but not present. It was expressly left open by the CA in
Adams v Cape Industries. In State Bank of India v Murjani, CA stated obiter that residence without presence was like 'continued presence' and thus would be enough. This vindicates sovereignty & comity and does not unacceptably sacrifice practicality; indeed, comity justifies leniency.
Briggs (2015):
 This position vindicates sovereignty & comity: if a person enters a country, they agree to be subject to its institutions.
 It practically provides a clear bright-line rule—a person is either present or she is not—so
D knows for certain that, to avoid being subject to that country's jurisdiction, she simply should not enter the country.
Adams v Cape Industries approach is the same as the South African Supreme Court approach:
Richman v Ben-Tovim: Judgment was given by English court after personal service of the
English proceedings on D whilst he was temporarily present in England, but not resident or domiciled there. Held that personal service was sufficient.
b. Specifically for companies: Rather than looking for economic presence, the court in Adams v Cape
Industries has applied a more physical test based on the notion of a place of business. In essence, the company needs to be doing business (either themselves or through an agent or representative doing the company's business) from a fixed and reasonably permanent place of business in the foreign country
*recall Dunlop v Cuddell: trade fair stall where 50% business was made; NB Adams v Cape makes clear that the cases relating to jurisdiction are applicable to enforcement.

FACTS: American judgment against Cape, the English parent company, concerning asbestosis,
having been sued in Texas by virtue of the fact that they had a marketing subsidiary company in
Texas.

HELD: Not present. An overseas trading corporation is likely to be treated as present within the jurisdiction of the courts of a foreign country only where:
(i) Direct presence: Corporation has established & maintained at its own expense in that other country a fixed place of business of its own and for more than a minimal period of time has carried on its own business at or from such premises by its servants or agents (a branch office case); or
(ii) Indirect presence: A representative of the overseas corporation has for more than a minimal period of time been carrying on the overseas corporation's business in the other country at or from some fixed place of business.
 Had the representative carried on the corporation's business or her own? A critical factor is often agent's power to contract on behalf of company: Vogel v R&A Kohnstamm:
D (English company) was not indirectly present in Israel through an agent who sought customers & transmitted correspondence but who 'had no authority whatever to bind D in any shape or form'.

Court is reluctant to pierce corporate veil: On the facts it was held that it was not appropriate to pierce the corporate veil, and since a substantial part of the subsidiary company's business was in every sense its own business it did not act as an agent of Cape. Economically, Cape may have been present, but they were legally separate companies, and the subsidiary company did not have authority to contract on behalf of Cape parent. Therefore not present.

Federal foreign state? CA in Adams v Cape Industries assumed that presence of a subsidiary company in Illinois would have been sufficient for the Texan judgment to be enforceable. However,
4 US as a federal state has different legal regimes in different states, so this might not be as straightforward as CA treated it.
c. Internet presence such as doing internet business, advertising, and making sales in a foreign state, is not sufficient: Lucasfilm v Ainsworth (CA).

2. Submission: 3 ways:
a. Judgment-debtor's voluntary participation in the foreign proceedings (Rubin v Eurofinance):
i. s.33(1) Civil Jurisdiction and Judgments Act 1982: 'For the purposes of determining whether a judgment given by a court of an overseas country should be recognised or enforced in England and Wales or Northern Ireland, the person against whom the judgment was given shall not be regarded as having submitted to the jurisdiction of the court by reason only of the fact that he has appeared (conditionally or otherwise) in the proceedings for all or any one or more of the following purposes, namely—
(a) to contest the jurisdiction of the court;
(b) to ask the court to dismiss or stay the proceedings on the ground that the dispute in question should be submitted to arbitration or to 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.'
NB: This statutorily reverses the previous contrary common law position irt stay in favour of arbitration: see Pan Ocean Ltd v China-Base Group.

ii. iii.

iv. v.

s.33(1) CJJA1982 statutorily reverses the common law position in relation to a stay in favour of arbitration. In Henry v Geoprosco (1976), it was held that the judgment was enforceable because D could be taken to have submitted to the jurisdiction of the Alberta court, having sought an order setting aside the service of the statement of claim and applied to stay the proceedings (which were refused).
Submission to jurisdiction must be unequivocal: Kamenogorsk: D's asking foreign court for reservation of their right to arbitrate indicates against submission.
 So long as not inconsistent with challenging jurisdiction: D will not be held to have submitted even where he has also argued on the merits, provided he has not behaved in a way which is inconsistent with challenging the jurisdiction: Marc Rich v Societa Italiana
(No.2), where, pursuant to the jurisdiction's procedural rules, D had to mandatorily submit a substantive defence, and jurisdiction would be heard on the first day of trial. C must withdraw as soon as they have lost the jurisdiction challenge.
Related proceedings do not count: If D submits to proceedings brought by C1 in a foreign country, this is not to be regarded as an implied submission to related proceedings commenced by
C2 in the same court, even if the proceedings involve almost identical issues: Adams v Cape
Industries: the 2 sets of proceedings were not to be regarded as 'one unit of litigation'.
Follow if foreign court does not characterise as appearance: If the foreign court does not characterise D's participation as amounting to an appearance, an English court should not do so either: Adams v Cape Industries; The Eastern Trader.
Conversely, English law determines voluntary appearance: It is not sufficient that the judgment-debtor submitted in the eyes of the foreign court. It must be shown that she took part in the foreign proceedings in a way accepted by English law as amounting to a voluntary appearance: Kamenogorsk 5 b. Judgment-debtor took part in proceedings as claimant: e.g. C brings an action in New York for breach of contract against D and the NY court gives judgment in D's favour and orders C to pay D's costs. The order for costs would be enforceable in England.
i. The counterclaim must arise out of the same facts or transaction as his claim or out of facts which are reasonably connected. → A test of broad common sense applies: Murthy v Sivasjothi.
c. Judgment-debtor consented to jurisdiction of the forum in which the judgment was obtained.
i. Normally in the form of a contractual clause providing for the exclusive or non-exclusive jurisdiction of the court.
 The dispute and the particular court in which the action is brought must fall within the four corners of the contractual term.
 The term itself must have remained valid and contractually enforceable at the date of the action.
ii. Possible to imply agreement/consent to submit: Vizcaya Partners v Picard (PC):
 An agreement to submit to the jurisdiction of a foreign court did not have to be contractual in nature. The real question was whether the judgment-debtor had consented in advance to the jurisdiction of the foreign court.
 It was commonplace that a contractual agreement or consent might be implied or inferred.
There was no reason in principle why the position should be different in the case of a contractual agreement or consent to the jurisdiction of a foreign court.
 The authorities which denied the possibility of an implied agreement really meant that there had to be an actual agreement or consent (see Singh v Rajah of Faridkote).
 Because there had to be an actual agreement, the agreement or contractual term could not be implied or inferred from such matters as the mere fact of being a shareholder in a foreign company or a member of a foreign partnership; the fact that the contract was made in or governed by the law of a foreign country; the fact that the contract was to be performed in the foreign country; or the fact that the foreign court had jurisdiction under its own law as a result of the contract being governed by foreign law.
 Terms implied as a matter of fact depended on construction of the contract in light of the circumstances. Where the applicable law was foreign law, questions of interpretation were governed by the applicable law, so the English court would apply the foreign rules of construction to the contract.
 Terms implied as a matter of law depended on whether a particular term was implied by law in the foreign law. On the facts, even as a matter of NY law, the evidence did not state that a choice of law carried with it an agreement to the jurisdiction of the NY court.
Kupelyants (2016) has argued that it is odd to use the law of the main contract for the implication of terms in fact, since implication is a question of fact, and therefore a procedural question of evidence. Such questions are normally subejct to the lex fori
(Gan Insurance). Nevertheless, both parties reasonably expect such a matter to be governed by law of the main contract if it is implied. It is putative law (Dornoch); should apply it.
Kupelyants also raises the issue of cost: the application of the foreign law means the content of the foreign law must be adduced at summary proceedings stage, which is expensive and lengthy.
Dickinson (2019) argues that the conceptual label of 'submission' for cases of voluntary participation by D in foreign proceedings is problematic: the label is given to formal participation in proceedings as well as to agreement on jurisdiction (as in Vizcaya),
when it is not actually obvious what these two have in common.
 If the principle underpinning submission is consent, then the common labelling of those two forms of litigants' conduct is problematic. Formal participation in proceedings expresses consent between litigant and the court, not litigant and litigant
(the two are only connected insofar as they share the same dispute). Agreement on jurisdiction expresses consent between litigant and litigant.
 This ambiguity and imprecision of the term 'submission' has left an explanatory gap in why a party who 'submits' to the jurisdiction of a foreign court (in the different possible ways) is bound by its judgment.
6

Buy the full version of these notes or essay plans and more in our Conflict of Laws Notes.