Enforcement of foreign judgments
Encyclopedia
In law, the enforcement of foreign judgments is the recognition and enforcement in one jurisdiction of judgments rendered in another ("foreign") jurisdiction. Foreign judgments may be recognized based on bilateral
or multilateral treaties
or understandings, or unilaterally without an express international agreement.
of one country or jurisdiction accepts a judicial decision made by the courts of another "foreign" country or jurisdiction, and issues a judgment in substantially identical terms without rehearing the substance of the original lawsuit.
In American legal terminology, a "foreign" judgment means a judgment from another state in the United States or from a foreign country. To differentiate between the two, more precise terminology used is "foreign-country judgment" (for judgments from another country) and "foreign sister-state judgment" (from a different state within the United States).
Once a foreign judgment is recognized, the party
who was successful in the original case can then seek its "enforcement" in the recognizing country. If the foreign judgment is a money judgment and the debtor has assets in the recognizing jurisdiction, the judgment creditor has access to all the enforcement remedies as if the case had originated in the recognizing country, e.g. garnishment
, judicial sale, etc. If some other form of judgment was obtained, e.g. affecting status
, granting injunctive
relief, etc., the recognizing court will make whatever orders are appropriate to make the original judgment effective.
Foreign judgments may be recognized either unilaterally or based on principles of comity
, i.e. mutual deference between courts in different countries.
Between two different States in the United States, enforcement is generally required under the "Full Faith and Credit Clause" (Article IV, Section 1) of the U.S. Constitution, which compels a State to give another State's Judgment an effect as if it were local. This usually requires some sort of an abbreviated application on notice, or docketing. Between one State in the United States, and a foreign country, Canada, for example, the prevailing concept is comity
. The Court in the United States, in most cases, will unilaterally enforce the foreign judgment, without proof of diplomatic reciprocity, either under judge-made law or under specific statutes.
Recognition will be generally denied if the judgment is substantively incompatible with basic legal principles in the recognizing country. For example, US courts now, in accordance with the August 2010 Speech Act, not permit enforcement of foreign libel judgments in cases (e.g. based on libel) unless the foreign country protects free speech to the same extent as the U.S. Constitution does in the First Amendment, etc.
(presently only ratified by Cyprus
, Kuwait
, the Netherlands
and Portugal
), the EC Council Regulation on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters or a similar treaty or convention providing for the routine of registration and enforcement between states, the courts of most states will accept jurisdiction
to hear cases for the recognition and enforcement of judgments awarded by the courts of another state if the defendant
or relevant assets are physically located within their territorial boundaries. Whether recognition will be given is determined by the lex fori
, i.e. the domestic law
of the court where recognition is sought, and the principles of comity
. The following issues are considered:
There is a general reluctance to enforce foreign judgments which involve multiple or punitive damages
. In this context, it is noted that the U.S. is not a signatory to any treaty or convention and there are no proposals for this position to change. When it comes to seeking the enforcement of U.S. judgments in foreign courts, many states are uncomfortable with the amount of money damages awarded by U.S. courts which consistently exceed the compensation available in those states. Further, the fact that the U.S. courts sometimes claim extraterritorial jurisdiction offends other states' conceptions of sovereignty
. Consequently, it can be difficult to persuade some courts to enforce some U.S. judgments.http://www.agulnicklaw.com/practice/collections/
A judgment rendered in a "sister" state or a territory of the U.S. is also referred to as a "foreign judgment." 47 states, the District of Columbia and the Virgin Islands have adopted the Uniform Enforcement of Foreign Judgments Act, 13 U.L.A. 261 (1986), which requires the states and the territories to give effect to the judgments of other states and territories, if an exemplified copy of the foreign judgment is registered with the clerk of a court of competent jurisdiction along with an affidavit stating certain things. California adopted the UFMJR Act in 1967.
New York State is one of a small minority of U.S. jurisdictions that does not simply allow a judgment creditor to file a foreign judgment from a sister state if the judgment was obtained by default (meaning the other side never showed up for to contest its entry in the other state by, for example, defending himself at trial) or the judgment was obtained by confession (meaning the other side signed paperwork allowing a judgment to be entered against him). Instead, a party wishing to domesticate the foreign default judgment or foreign judgment obtained by confession must bring another action in New York State "on the judgment" where the relief sought is to have the foreign judgment domesticated in New York State. Moreover, a quicker "motion-action" procedure is avaialble in New York where the owner of the foreign default judgment/judgment by confession files a summons and notice of motion for summary judgment in lieu of complaint.
The only U.S. states which have not adopted the Uniform Enforcement of Foreign Judgments Act are Indiana, Massachusetts and Vermont. When seeking to enforce a judgment in or from a state that has not adopted the Uniform Act, the holder of the judgment files a suit known as a "domestication" action. Since the full faith and credit clause
of the U.S. constitution requires that states honor the judgments of other states, the domestication of a judgment from another state is generally a formality, even in the absence of the expedited procedure under the UEFJA.
To solve the problem of libel tourism
, the SPEECH Act of 2010 makes foreign libel judgments unenforceable in U.S. courts, unless those judgments are compliant with the U.S. First Amendment
. The act was passed by the 111th United States Congress
and signed into law by President Barack Obama
.
, 21 UST 2517; TIAS 6997; 330 UNTS 3, and the Inter-American Convention on International Commercial Arbitration, 14 I.L.M. 336 (1975). Ratified treaties in the U.S. are considered "supreme law of the land".
Bilateralism
Bilateralism consists of the political, economic, or cultural relations between two sovereign states. For example, free trade agreements signed by two states are examples of bilateral treaties. It is in contrast to unilateralism or multilateralism, which refers to the conduct of diplomacy by a...
or multilateral treaties
Treaty
A treaty is an express agreement under international law entered into by actors in international law, namely sovereign states and international organizations. A treaty may also be known as an agreement, protocol, covenant, convention or exchange of letters, among other terms...
or understandings, or unilaterally without an express international agreement.
Definition of terms
The "recognition" of a foreign judgment occurs when the courtCourt
A court is a form of tribunal, often a governmental institution, with the authority to adjudicate legal disputes between parties and carry out the administration of justice in civil, criminal, and administrative matters in accordance with the rule of law...
of one country or jurisdiction accepts a judicial decision made by the courts of another "foreign" country or jurisdiction, and issues a judgment in substantially identical terms without rehearing the substance of the original lawsuit.
In American legal terminology, a "foreign" judgment means a judgment from another state in the United States or from a foreign country. To differentiate between the two, more precise terminology used is "foreign-country judgment" (for judgments from another country) and "foreign sister-state judgment" (from a different state within the United States).
Once a foreign judgment is recognized, the party
Party (law)
A party is a person or group of persons that compose a single entity which can be identified as one for the purposes of the law. Parties include: plaintiff , defendant , petitioner , respondent , cross-complainant A party is a person or group of persons that compose a single entity which can be...
who was successful in the original case can then seek its "enforcement" in the recognizing country. If the foreign judgment is a money judgment and the debtor has assets in the recognizing jurisdiction, the judgment creditor has access to all the enforcement remedies as if the case had originated in the recognizing country, e.g. garnishment
Garnishment
A garnishment is a means of collecting a monetary judgment against a defendant by ordering a third party to pay money, otherwise owed to the defendant, directly to the plaintiff...
, judicial sale, etc. If some other form of judgment was obtained, e.g. affecting status
Status (law)
A person's status is a set of social conditions or relationships created and vested in an individual by an act of law rather than by the consensual acts of the parties, and it is in rem, i.e. these conditions must be recognised by the world. It is the qualities of universality and permanence that...
, granting injunctive
Injunction
An injunction is an equitable remedy in the form of a court order that requires a party to do or refrain from doing certain acts. A party that fails to comply with an injunction faces criminal or civil penalties and may have to pay damages or accept sanctions...
relief, etc., the recognizing court will make whatever orders are appropriate to make the original judgment effective.
Foreign judgments may be recognized either unilaterally or based on principles of comity
Comity
In law, comity specifically refers to legal reciprocity—the principle that one jurisdiction will extend certain courtesies to other nations , particularly by recognizing the validity and effect of their executive, legislative, and judicial acts...
, i.e. mutual deference between courts in different countries.
Between two different States in the United States, enforcement is generally required under the "Full Faith and Credit Clause" (Article IV, Section 1) of the U.S. Constitution, which compels a State to give another State's Judgment an effect as if it were local. This usually requires some sort of an abbreviated application on notice, or docketing. Between one State in the United States, and a foreign country, Canada, for example, the prevailing concept is comity
Comity
In law, comity specifically refers to legal reciprocity—the principle that one jurisdiction will extend certain courtesies to other nations , particularly by recognizing the validity and effect of their executive, legislative, and judicial acts...
. The Court in the United States, in most cases, will unilaterally enforce the foreign judgment, without proof of diplomatic reciprocity, either under judge-made law or under specific statutes.
Recognition will be generally denied if the judgment is substantively incompatible with basic legal principles in the recognizing country. For example, US courts now, in accordance with the August 2010 Speech Act, not permit enforcement of foreign libel judgments in cases (e.g. based on libel) unless the foreign country protects free speech to the same extent as the U.S. Constitution does in the First Amendment, etc.
Exercise of jurisdiction in recognition cases
If the country that issued the judgment and the country where recognition is sought are not parties to the Hague Convention on Foreign Judgments in Civil and Commercial MattersHague Convention on Foreign Judgments in Civil and Commercial Matters
The Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters is a multilateral treaty governing the enforcement of judgments entered by one nation's legal authorities in other signatory nations...
(presently only ratified by Cyprus
Cyprus
Cyprus , officially the Republic of Cyprus , is a Eurasian island country, member of the European Union, in the Eastern Mediterranean, east of Greece, south of Turkey, west of Syria and north of Egypt. It is the third largest island in the Mediterranean Sea.The earliest known human activity on the...
, Kuwait
Kuwait
The State of Kuwait is a sovereign Arab state situated in the north-east of the Arabian Peninsula in Western Asia. It is bordered by Saudi Arabia to the south at Khafji, and Iraq to the north at Basra. It lies on the north-western shore of the Persian Gulf. The name Kuwait is derived from the...
, the Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
and Portugal
Portugal
Portugal , officially the Portuguese Republic is a country situated in southwestern Europe on the Iberian Peninsula. Portugal is the westernmost country of Europe, and is bordered by the Atlantic Ocean to the West and South and by Spain to the North and East. The Atlantic archipelagos of the...
), the EC Council Regulation on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters or a similar treaty or convention providing for the routine of registration and enforcement between states, the courts of most states will accept jurisdiction
Jurisdiction
Jurisdiction is the practical authority granted to a formally constituted legal body or to a political leader to deal with and make pronouncements on legal matters and, by implication, to administer justice within a defined area of responsibility...
to hear cases for the recognition and enforcement of judgments awarded by the courts of another state if the defendant
Defendant
A defendant or defender is any party who is required to answer the complaint of a plaintiff or pursuer in a civil lawsuit before a court, or any party who has been formally charged or accused of violating a criminal statute...
or relevant assets are physically located within their territorial boundaries. Whether recognition will be given is determined by the lex fori
Lex fori
Lex fori is a legal term used in the conflict of laws used to refer to the laws of the jurisdiction in which a legal action is brought...
, i.e. the domestic law
Law
Law is a system of rules and guidelines which are enforced through social institutions to govern behavior, wherever possible. It shapes politics, economics and society in numerous ways and serves as a social mediator of relations between people. Contract law regulates everything from buying a bus...
of the court where recognition is sought, and the principles of comity
Comity
In law, comity specifically refers to legal reciprocity—the principle that one jurisdiction will extend certain courtesies to other nations , particularly by recognizing the validity and effect of their executive, legislative, and judicial acts...
. The following issues are considered:
- Whether the foreign court properly accepted personal jurisdiction over the defendantDefendantA defendant or defender is any party who is required to answer the complaint of a plaintiff or pursuer in a civil lawsuit before a court, or any party who has been formally charged or accused of violating a criminal statute...
; - Whether the defendant was properly served with notice of the proceedings and given a reasonable opportunity to be heard which raises general principles of natural justiceNatural justiceNatural justice is a term of art that denotes specific procedural rights in the English legal system and the systems of other nations based on it. Whilst the term natural justice is often retained as a general concept, it has largely been replaced and extended by the more general "duty to act fairly"...
and will frequently be judged by international standards (hence, the rules for service on a non-resident defendant outside the jurisdiction must match general standards and the fact that the first instance court's rules were followed will be irrelevant if the international view is that the local system is unjust); - Whether the proceedings were tainted with fraudFraudIn criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...
; and - Whether the judgment offends the public policyPublic policy (law)In private international law, the public policy doctrine or ordre public concerns the body of principles that underpin the operation of legal systems in each state. This addresses the social, moral and economic values that tie a society together: values that vary in different cultures and change...
of the local state.
There is a general reluctance to enforce foreign judgments which involve multiple or punitive damages
Damages
In law, damages is an award, typically of money, to be paid to a person as compensation for loss or injury; grammatically, it is a singular noun, not plural.- Compensatory damages :...
. In this context, it is noted that the U.S. is not a signatory to any treaty or convention and there are no proposals for this position to change. When it comes to seeking the enforcement of U.S. judgments in foreign courts, many states are uncomfortable with the amount of money damages awarded by U.S. courts which consistently exceed the compensation available in those states. Further, the fact that the U.S. courts sometimes claim extraterritorial jurisdiction offends other states' conceptions of sovereignty
Sovereignty
Sovereignty is the quality of having supreme, independent authority over a geographic area, such as a territory. It can be found in a power to rule and make law that rests on a political fact for which no purely legal explanation can be provided...
. Consequently, it can be difficult to persuade some courts to enforce some U.S. judgments.http://www.agulnicklaw.com/practice/collections/
Enforcement of foreign judgments in the U.S.
If the time to appeal in the court of origin has lapsed, and the judgment has become final, the holder of a foreign judgment, decree or order may file suit before a competent court in the U.S. which will determine whether to give effect to the foreign judgment. The local version of the Uniform Foreign Money Judgments Recognition Act applies in most states, for example in California. 13 U.L.A. 149 (1986).A judgment rendered in a "sister" state or a territory of the U.S. is also referred to as a "foreign judgment." 47 states, the District of Columbia and the Virgin Islands have adopted the Uniform Enforcement of Foreign Judgments Act, 13 U.L.A. 261 (1986), which requires the states and the territories to give effect to the judgments of other states and territories, if an exemplified copy of the foreign judgment is registered with the clerk of a court of competent jurisdiction along with an affidavit stating certain things. California adopted the UFMJR Act in 1967.
New York State is one of a small minority of U.S. jurisdictions that does not simply allow a judgment creditor to file a foreign judgment from a sister state if the judgment was obtained by default (meaning the other side never showed up for to contest its entry in the other state by, for example, defending himself at trial) or the judgment was obtained by confession (meaning the other side signed paperwork allowing a judgment to be entered against him). Instead, a party wishing to domesticate the foreign default judgment or foreign judgment obtained by confession must bring another action in New York State "on the judgment" where the relief sought is to have the foreign judgment domesticated in New York State. Moreover, a quicker "motion-action" procedure is avaialble in New York where the owner of the foreign default judgment/judgment by confession files a summons and notice of motion for summary judgment in lieu of complaint.
The only U.S. states which have not adopted the Uniform Enforcement of Foreign Judgments Act are Indiana, Massachusetts and Vermont. When seeking to enforce a judgment in or from a state that has not adopted the Uniform Act, the holder of the judgment files a suit known as a "domestication" action. Since the full faith and credit clause
Full Faith and Credit Clause
The Full Faith and Credit Clause is the familiar name used to refer to Article IV, Section 1 of the United States Constitution, which addresses the duties that states within the United States have to respect the "public acts, records, and judicial proceedings of every other state." According to...
of the U.S. constitution requires that states honor the judgments of other states, the domestication of a judgment from another state is generally a formality, even in the absence of the expedited procedure under the UEFJA.
To solve the problem of libel tourism
Libel tourism
Libel tourism is a term first coined by Geoffrey Robertson to describe forum shopping for libel suits. It particularly refers to the practice of pursuing a case in England and Wales, in preference to other jurisdictions, such as the United States, which provide more extensive defences for those...
, the SPEECH Act of 2010 makes foreign libel judgments unenforceable in U.S. courts, unless those judgments are compliant with the U.S. First Amendment
First Amendment to the United States Constitution
The First Amendment to the United States Constitution is part of the Bill of Rights. The amendment prohibits the making of any law respecting an establishment of religion, impeding the free exercise of religion, abridging the freedom of speech, infringing on the freedom of the press, interfering...
. The act was passed by the 111th United States Congress
111th United States Congress
The One Hundred Eleventh United States Congress was the meeting of the legislative branch of the United States federal government from January 3, 2009 until January 3, 2011. It began during the last two weeks of the George W. Bush administration, with the remainder spanning the first two years of...
and signed into law by President Barack Obama
Barack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...
.
Exceptions
A state may not enforce a foreign-country judgment in the following cases:- The judgment was not rendered by an impartial tribunals under procedures compatible with the requirements of due process of law;
- The foreign court did not have personal jurisdiction over the defendant;
- The foreign court did not have jurisdiction over the subject matter;
- The defendant did not receive notice of the proceedings in sufficient time to enable him to defend;
- The judgment was obtained by fraud;
- The judgment is repugnant to the public policy of the state where enforcement is sought;
- The judgment conflicts with another final and conclusive judgment;
- The proceeding in the foreign court was contrary to an agreement between the parties under which the dispute was to be settled;
- In the case of jurisdiction based only on personal service, the foreign court was an inconvenient forum for the trial; or
- The judgment seeks to enforce the revenue and taxation laws of a foreign jurisdiction.
Enforcement of foreign arbitration awards in the U.S.
Arbitration awards enjoy the protection of special treaties. The U.S. is a signatory to international conventions regulating the enforcement of arbitration awards, viz, the Convention on the Recognition and Enforcement of Foreign Arbitral AwardsConvention on the Recognition and Enforcement of Foreign Arbitral Awards
The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Convention, was adopted by a United Nations diplomatic conference on 10 June 1958 and entered into force on 7 June 1959...
, 21 UST 2517; TIAS 6997; 330 UNTS 3, and the Inter-American Convention on International Commercial Arbitration, 14 I.L.M. 336 (1975). Ratified treaties in the U.S. are considered "supreme law of the land".