Posts Tagged Public order

Akhter v Khan. Nikah in the High Court.

As Williams J notes at 5, [2018] EWFC 54 Akhter v Khan is not about

whether an Islamic marriage ceremony (a Nikah) should be treated as creating a valid marriage in English law. In fact, the main issue as it has emerged is almost diametrically the opposite of that question; namely whether a Nikah marriage ceremony creates an invalid or void marriage in English law. To the average non-lawyer in 2018, it may appear an easy question to answer. Surely a marriage which is not a valid marriage is a void marriage and thus can be annulled? Regrettably it is not that simple.

The Guardian explain here why it is not that simple, and Ralf Michaels has analysis here. In essence (the remainder of this para is largely based on Ralf’s text), many muslims in the UK only perform Nikah and not a civil ceremony. The latter is firmly required under English law (indeed under the law of many European countries; where unlike in the English example, a religious ceremony must not even double up as a civil one, and the latter must always precede the religious one). Nikah hitherto had been considered a non-marriage which the law could ignore, because it did not even purport to comply with the requirements of English law. The High Court was unwilling to presume the lived marriage as valid.

Williams J however declared the marriage at issue void under the Matrimonial Causes Act 1973. The wife was granted a decree of nullity. This has extremely relevant consequences in terms of ‘matrimonial’ property, and maintenance obligations, including those vis-a-vis the children. The Court’s analysis of human rights law is extensive, including of course with the ECHR gateway (via the Human Rights Act 1998) and the UNRC: the UN Convention on the Right of the Child. In this respect Williams J’s analysis is not unlike that of classic ordre public considerations: which are always case-specific and take into account the hardship caused to the individuals involved, were a foreign legal concept not recognised in the forum.

The Court has set an important precedent – but like all precedent of course there is case-specificity (the length of the lived marriage, the children,…

Of note is that applicable law in the case was firmly English law. Recognition of the marriage as such in the UAE did play a role in the judge’s assessment.

All in all an important case viz the discussion on multiculturality and family law in Europe.

Geert.

 

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Pearl v Kurdistan. The DIFC on waivers of sovereign immunity.

Update 17 November 2017 For discussions in Dutch case-law (including re contractual waiver) with respect to SHAPE, see here.

Thank you Peter Smith over at Tamimi for flagging [2017] DIFC ARB 003 Pearl v Kurdistan. Peter summarises as follows:

‘In 2007, Crescent Petroleum, the oldest privately-owned oil and gas company in the Middle East, agreed with Dana Gas, one the leading publicly-listed natural gas companies in the region, to create a joint venture called Pearl Petroleum (together, “the Consortium”). The Consortium entered into an agreement with the Kurdistan Regional Government (“KRG”) for the development of the Khor Mor and Chemchemal petrochemical fields in the Kurdistan region of Iraq. The KRG were and remain engaged in a political dispute with the Federal Government of Iraq, meaning that the Consortium were unable to export gas produced by the developed fields. As a result, the KRG became liable under its contract with the Consortium to pay a minimum guaranteed price, but it failed to make the required payments in full.’

Arbitration in London under LCIA rules ensued. The contract between the Consortium and the KRG was governed by English law and provided explicitly that “the KRG waives on its own behalf and that of [The Kurdistan Region of Iraq] any claim to immunity for itself and its assets”.

Cooke J held that whilst the UAE’s recognition of other states was a matter of foreign policy which the DIFC Courts could not rule on, construing the KRG’s waiver of immunity was a question of law and not public policy. In agreeing to arbitrate, a party agrees that the arbitration shall be effective in determining the rights of the parties (at 26). The waiver of any claim to immunity for itself and its assets must mean waiver of immunity from execution (at 28): any argument on that is blocked by issue estoppel (at 36).

Sovereign immunity therefore was not a trump which could be played at the time of enforcement: whatever immunity there might or might not have been had been contractually signed away.

An interesting and well argued judgment.

Geert.

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Belgian initiative to tackle ‘vulture funds’ acknowledges these are, after all, migratory birds.

Update 21 March 2016 (these updates seem to follow an equinox pattern) NML Capital Ltd reportedly are contesting the legality of the Act before the Belgian Constitutional Court. (Update 24 March the Constitutional Court has the case down under three seperate actions, 6371, 6372, 6373).

Update 21 September 2015: the Act was adopted in July and enters into force today.

I have delayed reporting on this initiative for exam reasons. The Belgian Parliament is currently debating a private members’ proposal for statute to address so-called ‘vulture funds’. These funds are described by the financial dictionary as ‘A fund that buys distressed debt of commercial companies or sovereign nations at a cheap price and then often sues them for the entire value of the debt. The resemblance to vultures is because these funds profit from the debt of failing companies or poor nations.

The text of the proposal (in Dutch and French) is available here. Vulture funds litigation is generally called immoral in the proposal. Reference is made to a number of high-profile recent judgments where vulture funds have been given approval by various courts worldwide, to seek redress against assets held by the sovereign nations concerned, or indeed their creditors. Particularly sore is the enforcement sought against funds destined for development aid.

The proposal essentially defines ‘vulture funds’ and then suggests that recognition and enforcement of relevant judgments or arbitral awards, regardless of the law applicable to the underlying relationship with the government concerned, is considered to be contrary to Belgian ordre public international, hence unenforceable. The proposal as it stands now adds (probably superfluously) that relevant EU (read: the Brussels I recast Regulation) and international (read especially: the 1958 New York Convention) law takes priority.

The part of the proposal that is bound to attract attention is the attempt at defining the ‘vulture’ in vulture funds. Frits Bolkestein for instance (former EU Commissioner) has remarked that buying up ‘bad debt’ need not always be morally reprehensible (I would suggest it is not that part of the fund’ activities which has attracted the Belgian Parliament’s attention). The enforcement /recognition part of the proposal is interesting because it applies ordre public in a categorical manner, rather than in the ad hoc application which both EU law and residual Belgian conflicts law (the Belgian Private International Law Act) ordinarily call for. For residual Belgian law, this is probably Parliament’s prerogative. However for EU law (and the New York convention), a general apprehension against vulture funds may not qualify as a proper exercise of the ordre public exception. Courts at the least may wish formally to disregard the act when the judgment /award concerned is covered by Brussels I cq. New York; however they can point to the sentiment expressed in the Act, to support incompatibility with Belgian ordre public when tested against an individual case.

The drafters are aware that this initiative may be a drop in the ocean. Reference is made to other, national initiatives (France, UK, US) which may point to an emerging pattern of anti-vulture funds sentiment. Indeed the realities of forum shopping mean that vulture funds action will migrate away from the Belgian legal order. On the other hand, Belgium’s safe harbour may also mean that relevant assets will seek refuge there. All of course, presuming the initiative will actually be adopted by Parliament.

Geert. Disclosure: I advised the MPs concerned on the technical aspects of the recognition and enforcement leg of the proposal. [My advice may or may not have been followed ].

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Celtic Salmon: Irish High Court holds there’s something fishy in the State of Denmarks’ lex fori

Granted, only Monday mornings arguably may excuse such lame pun in a blog’s posting.  However the slightly lousy title should not take away from the relevance of Celtic Salmon v Aller Acqua in which the Irish High Court partially refused recognition of a Danish judgment.

Hogan J summarised the issue as follows: Where a defendant in foreign proceedings governed by the Brussels Regulation (Council Regulation No. 44/2001 EC) fails to advance and maintain a counter-claim for damages for (sic) in those proceedings, is that party then barred by the doctrine of res judicata or by the provisions of the Brussels Regulation itself from re-litigating that counterclaim for damages for breach of contract and negligence in existing proceedings in this jurisdiction where it sues as plaintiff?

Celtic Salmon used Aller Ireland, the Irish subsidiary, as anchor defendant. The mother company, Aller Denmark, was duly joined to the proceedings. Vets, commissioned by Celtic Atlantic, had established a deficiency in the feed supplied by Aller Denmark.  The dispute between the parties then started with a letter sent by Celtic Atlantic in July, 2008 claiming damages for the (allegedly) defective fish feed. Aller Denmark responded by denying liability, but also claimed for unpaid invoices in respect of the fish feed. In November 2008, aller Denmark fired the first shot in litigation, suing in Denmark. There were two separate claims. First, Aller Denmark claimed in respect of certain unpaid invoices for the fish feed (“claim 1”). (It also reserved its position to make further claims in this regard. The claim taken forward only related to a fraction of the feed actually supplied). Second, it sought an order that “Celtic be ordered to admit that the delivered feed on which Aller Acqua’s claim is based is in conformity with the contract.” (“claim 2”).

Celtic’s Irish solicitors, according to the judgment, advised that it would be unwise to bring a counter-claim in the Danish proceedings, because to do so “would preclude us from bringing proceedings in Ireland for damages for breach of contract.” In May 2009, Irish proceedings were brought by Celtic. These amounted to a claim for damages for negligence and breach of contract by reason of the allegedly defective nature of the fish feed.

The Danish courts accepted jurisdiction on the basis of Article 5 based upon (whether this had been agreed was disputed between parties) delivery (incoterm) ex works /ex factory. This is the point were procedural difficulties started (hence the relevance of lexi fori). The reports earlier commissioned by Celtic, turned out not to be admissible (or at the very least would be regarded with suspicion) by the Danish courts given that under Danish civil procedure, the court appoints its own experts. However at the time this would have been carried forward, both fish and fish feed were no longer. Celtic Atlantic elected not to pursue the counterclaim in respect of the defective feed, and reserved the right to do so at a later date (without specific reference to Danish or Irish courts).

The Danish court eventually sided with Aller in respect of two claims: claim 1 for debt in respect of the two unpaid invoices in the sum €58,655 plus interest. Claim 2” that “Celtic [Atlantic] be ordered to admit that the delivered feed on which Aller [Denmark]’s claim is based is in conformity with the contract. There was subsequently discussion among Danish experts in the Irish courts, whether the Danish judgment was in default of appearance, given the absence of defence against at least part of it.

The question now sub judice was the fate of the Irish proceedings, Hogan J justifiably concluded that Article 27 JR (the lis alibi pendens rule) no longer had any relevance, given that the Danish proceedings had come to an end. Rather, whether Celtic’s claims in the Irish courts were the same as those entertained in Denmark (and hence continuing them in Ireland, per se abusive, ia given comity) and /or whether Aller could waive the Danish judgment in defence of the Irish claims. The latter would imply recognition of the Danish judgment.

[The High court carries out a review of the Danish court’s jurisdiction under Article 5(1) and 3, with reference as for the latter inter alia to Folien Fischer however in doing so I would argue it surpassed its brief: other than for exclusive jurisdictional rules, under the current Brussels I regime, there is no room for other courts to second-guess the application of the Regulation by other courts].

Article 34(1) of the Brussels Regulation provides that “A judgment shall not be recognised: 1. If such recognition is manifestly contrary to public policy in the Member State in which recognition is sought…..” Hogan J emphasises procedural rights per Krombach, and the Charter, and concludes that by reason of the manner in which the Danish Administration of Justice Act operated in this case, the effective procedural rights of Celtic Atlantic were violated so far as claim 2 is concerned. He insisted that (only) on ‘the special and particular facts of this case, the existence and operation of the Danish law operated (…) as an “insuperable” procedural obstacle which barred the effective prosecution of its claim.’ (at 124).

A considerate judgment and one which, if only because of its rarity and the insight it offers into procedural and tactical considerations in entertaining, or not, counterclaims, stands out in national case-law on the Brussels I- Regulation.

Geert.

 

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