There is much to be said about the refusal of the courts at Zurich at the end of February, to recognise a September 2020 High Court judgment under the 2007 Lugano Convention. Rodrigo Rodriguez says it all here and I am happy to refer. The guillotine fashion in which the courts rejected application of Lugano 2007 even for a procedure that was initiated before Brexit date 1 January 2021 leaves much to be discussed. As does the question whether the demise of Lugano 2007 might not resurrect Lugano 1988 (Rodrigo points ia to the dualist nature of the UK in his discussion of same).
Whether correct or not in the specific case at issue, the judgment does show the clear bumpy ride ahead for UK judgments across the continent, following the Hard Brexit in judicial co-operation.
EU Private International Law, 3rd ed., 2021, Chapter 1, Heading 1.7.
Update 13 April 2021 see Matthias Lehmann’s reporting on yesterday’s rollercoaster news re the EC’s position viz the UK’s accession to Lugano.
Update 10 February 2021 see Steve Peers’ reporting on the UK’s formal confirmation of non-extension of the Brussels Convention and Rome 1980 Convention.
Update 5 January 2020 This CMS summary usefully points out that there is embryonic judicial co-operation on intellectual property rights (see p155 ff of the agreement, Section 2: Civil and administrative enforcement).
31 December 2020, the Seventh day of Christmas, delivered a hard Brexit in the area of judicial co-operation in civil matters – the core subject area of this blog. The moment the draft Trade and Cooperation Agreement between the EU and the UK broke, a few of us poured over the text to find any deal on the issue – in vain. Peter Bert has reporting and analysis here and here; Ralf Michaels summarised here (he also links to our Twitter reactions, which readers might find of use) and Marta Requejo Isidro links further to official documents here.
The UK’s application to join Lugano is still out there (the EU have an effective veto), however as things stand it seems unlikely the EU will agree.
Andrew Dickinson summarises the many things on the UK’s to do list here. As was clear to many of us, Sylvester 2020 was never going to be an end to, rather the start of interesting times in the sector.
EU Private International Law, 3rd ed. 2021, 1.36 ff.
Thank you Jan Jakob Bornheim for alerting me to Hebei Huaneng v Deming Shi_B  NZHC 2992, which dismissed the defendant’s application for summary judgment and discusses the notion of a ‘court’ , required to recognise its ‘judgments’ internationally. Readers will recognise the discussion ia from the CJEU case-law in judgments such as Pula Parking.
Hebei Huaneng had obtained judgment against Mr Shi at the Higher People’s Court of Hebei Province. The amount remained unsatisfied. Hebei Huaneng then found out that Mr Shi has assets in New Zealand – an inner-city apartment in Auckland and shares in a New Zealand company. Mr Shi objects to New Zealand hearing this case on the basis that China does not have true courts and that Hebei Huaneng should first enforce its securities in China.
At 78-79 Bell J holds briefly that questions of real and substantial connection with New Zealand and appropriate forum are not much in issue. The two main arguments raised at this stage lie elsewhere.
Given the lack of treaty on the issue between NZ and PRC, he summarises the NZ common law on recognition at 16: the common law regards a judgment of a foreign court as creating an obligation enforceable under New Zealand law if the judgment is given by a court, the judgment is final and conclusive, the judgment is for a definite sum, the parties are the same or privies, and the court had jurisdiction under New Zealand’s jurisdiction recognition rules. No merits review will be undertaken however refusal of enforcing a ‘money judgment’ is possible if obtained in breach of New Zealand standards of natural justice, enforcing the judgment would be contrary to public policy,
the judgment was obtained by fraud, the judgment was for a revenue debt, or the judgment involves the enforcement of a foreign penal law. Lack of reciprocal recognition by the other State is no objection.
On the issue of the notion of court, he notes at 29 that complaints that a foreign legal system is so defective that its courts cannot be trusted to do substantial justice may arise in two contexts: in forum non cases, where the analysis is prospective seeing as the case may not even be pending abroad; and in recognition cases, where the analysis is retrospective. At 28 Bell J already points out that style of writing etc. particularly also given the civil law background of China must not confuse. At 35 he notes to core issues viz the concept of court: (a) whether the bodies carrying out judicial functions are distinct from those with legislative and administrative function; and (b) whether the bodies carrying out judicial functions are subject to improper interference. Then follows lengthy-ish consideration of expert evidence to conclude at 60 that the good arguable case of the Chinese courts being independent, is satisfied.
The question of the ‘property security first’ principle’ which would mean satisfaction would first have to be sought against the Chinese secured assets, is discussed mostly in the context of Chinese law, against the backdrop of the common law principle of a party’s freedom to chose asset enforcement. The lex causae for that discussion I imagine will be further discussed at the merits stage.
A good case for the comparative conflicts binder.
I have twice already reported on The Prestige recognition issue: see here and here. In a further judgment at the end of July,  EWHC 1920 (Comm), Butcher J after helpfully summarising the various claims, considered
- whether a Member State may be served under the EU Service Regulation 1393/2007, or whether residual PIL (here: the UK State immunity Act) may insist on an alternative. This did not so much engage the issue of ‘civil and commercial’ (CJEU Fahnenbrock being cited) on which both parties agreed. Rather on the exhaustive effect or not of the Service Regulation, in particular, whether Member States may insist on service upon authorities of other Member States via diplomatic means only. Butcher J holding correctly in my view at 45, that service via the means provided for in the Regulation, suffices.
- next, whether the case engages sovereign immunity of Spain and France which Butcher J held that they do not for the most part. He mostly cites the States’ submission to arbitration in this respect.
- further, whether the English courts have jurisdiction or whether that is ruled out by virtue of the arbitration exception or the insurance title of the Regulation (at 93 ff; the preceding paras concern claims which fall outside BIA and are to be judged under common law). At 107 Butcher J holds that the arbitration exclusion is not engaged, citing national and CJEU authority as well as recital 12 BIa, and holding at 108 that ‘(t)he present Judgment Claims are a further step beyond what is contemplated by an ‘action or judgment concerning … the enforcement of an arbitral award’ in recital (12).’ As for the insurance heading, with reference to Aspen Underwriting, he holds that the insurance title is engaged, and (at 132) that the States they are entitled to the jurisdictional protections of Section 3, without it having to be shown that they are in fact economically weaker parties. (There is a lingering doubt over one of the claims subrogated to Spain). The insurance title being engaged, this mains that the parties protected by it may only be sued in their jurisdiction (Article 14(2)’s exception to that was held not to be applicable), hence the English Courts for those claims do not have jurisdiction.
The result is a partial jurisdiction in England only – and permission to appeal, I imagine.
(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 126.96.36.199, Heading 188.8.131.52, Heading 2.2.16.
I reviewed Szpunar AG’s Opinion in C-73/19 Belgische Staat v Movic BV et al here. The CJEU held this morning. At the time of posting an English version of the judgment was not yet available. The case at issue concerns enforcement of Belgium’s unfair trading act by the public authorities of the Member State. Movic BV of The Netherlands and the others defendants practices ticket touting: resale of tickets for leisure events.
The Court is more succinct than the AG in its analysis yet refers repeatedly to points made by Szpunar AG without itself therefore having to refer to so extensive an analysis.
The fact that a power was introduced by a law is not, in itself, decisive in order to conclude that the State acted in the exercise of State authority (at 52). Neither does the pursuit of the general interest automatically involve the exercise of public powers (at 53). With respect to the authorities’ powers of investigation, it would seem that the Court like the AG reads (at 57) C‑49/12 Sunico as meaning that to exclude proceedings from the scope of ‘civil and commercial matters’, it must be determined, in concreto, whether the public authority uses evidence which it has in its possession as a result of its public powers of investigation, hence putting it in a different position as a person governed by private law in analogous proceedings. Collecting evidence in the same way as a private person or a consumer association could, does not fall within that category (at 58).
Neither the request for penalty payments nor an application for an injunction makes the proceedings drop out off Brussels Ia: both instruments are available to private parties, too. That is not however the case for the observation of continued infringement by mere civil servant oath as opposed to bailiff certification. This, the Court holds like the AG, does amount to exercise of public authority (at 62) however (at 63) that element alone escapes BIA, it does not so taint the other part of the proceedings.
As I noted in my review of first Advocate General Szpunar’s Opinion, the need for highly factual considerations sits uneasily with the Regulation’s expressed DNA of predictability. However this squares with the CJEU case-law on ‘civil and commercial’.
(Handbook of) EU Private International Law, 2nd ed. 2016, Heading 2, Heading 2.2.
A short update on the Prestige litigation. I reported earlier on the disclosure order in the recognition leg of the case. In that review I also listed the issues to be decided and the preliminary assessment under Title III Brussels Ia. That appeal is to be heard in December 2020 (see also 21 ff of current judgment). In The London Steam-Ship Owners’ Mutual Insurance Association Ltd v Spain (M/T “PRESTIGE”)  EWHC 1582 (Comm) Henshaw J on 18 June held on yet another set of issues, related to arbitration and State Immunity.
He concluded after lengthy analysis to which it is best to refer in full, that Spain does not have immunity in respect of these proceedings; that the permission to serve the arbitration obligation our of jurisdiction, granted earlier to the Club should stand; and that the court should appoint an arbitrator.
I am pondering whether to add a State immunity chapter to the 3rd ed. of the Handbook – if I do, this case will certainly feature.
(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 184.108.40.206, Heading 220.127.116.11, Heading 2.2.16.
In Alexander Brothers Ltd (Hong Kong SAR) v Alstom Transport SA & Anor  EWHC 1584 (Comm) Cockerill J discussed inter alia (at 177 ff) the impact of EU law on the ordre public assessment for potential refusal of recognition of an arbitral award under section 103 of the 1980 New York Convention.
CJEU authority are C-126/ 97 Eco Swiss (concerning EU competition law) and C-168/ 05 Claro (unfair terms in consumer contracts). At 183 Cockerill J does not suggest the CJEU authority should no longer stand. Indeed she suggests obiter that there is no reason to suggest the CJEU’s line of reasoning should not apply to wider issues than just competition law or consumer law. However, the burden of proof of showing that particular parts of EU law are of a nature to justify the ordre public exception, lies upon the party objecting to recognition. In casu Alstom have fallen short of that duty. Yes, there is scant reference to anti-corruption in the private sector; and yes there is EU money laundering law. However (at 186) ‘the EU has, in general terms, set its face against corruption. But aside from the area of money laundering it has not put in place mandatory laws or rules. In the context of international corruption of the kind in focus here it has left it to the individual member states to adopt what measures seem good to them. There is, in short, no applicable mandatory rule or public policy.’
An interesting discussion.
Henshaw J in DVB Bank SE v Vega Marine Ltd & Ors  EWHC 1494 (Comm) (on substance a straightforward case on sums loaned) made some important observations on the benefits of summary judgment as opposed to a default judgment in the context of recognition and enforcement.
This a few days before publication of the thesis of Vincent Richard on the very topic.
There is no doubt the English courts have jurisdiction per a valid choice of court clause under A25 BIa. Claimants are pressing for summary judgment, citing
- Brexit. The Withdrawal Agreement extends EU law in civil procedure to proceedings issued before the end of the transition period, however claimants express anxiety over the speed of Greek enforcement proceedings given courts’ shutdown in the Covid19 era. At 61: ‘Greek counsel has advised the Claimants that the Greek courts shut down earlier this year for an indefinite period, so that obtaining an enforcement order in Greece would be likely to be delayed;’.
- More crucially however, Henshaw J notes at 61, correctly, that even under BIa, default judgments are more vulnerable: ‘there is a risk that an enforcement order based on a simple default judgment, even if obtained before 31 December 2020, might be set aside on public policy grounds. Greek counsel advised that the Greek courts would be much less likely to refuse to recognise and enforce a reasoned English judgment following a hearing on the merits.’
Summary judgment was given against the defendants.
A short note on Public Joint Stock Company (Rosgosstrakh) v Starr Syndicate Ltd & Ors  EWHC 1557 (Comm) just to illustrate the complications for recognition and enforcement in the absence of a near-automated process such as under Brussels IA (the Hague Judgments Convention is meant to lubricate the process internationally). Claimant applies for summary judgment on its claim for recognition and enforcement of three judgments obtained in its favour in the Russian courts in 2015 and 2016.
Moulder J first discussed the issue of lack of jurisdiction for the Russian courts and she finds at 93 after consideration that the discussions to and fro, and the evidence of Russian experts for each of the parties, necessitates proper discussion with oral evidence of the contractual construction, under Russian law, of the relevant choice of court clauses. Of course under BIa and other regimes operating with a certain amount of mutual trust, second-guessing jurisdiction is not part of the assessment.
Next, the allegations of bias are also discussed, with at 126 ia reference to an interference by President Putin, and at 138 a solid set of reasoning for Moulder J to dismiss the potential for summary judgment on this point, too. Of course bias is an ordre public issue which even under BIa’s rules for recognition of judgments from other Member States, might justify refusal of recognition.
DIFC Courts, the Dubai International Financial Centre’s Courts, is one of the new generation of international commercial courts. Its rulings piggyback unto recognition and enforcement treaties which the UAE concludes with third countries (India being a recent example).
In GFH Capital Ltd v Haigh & Ors  EWHC 1269 (Comm) Henshaw J first of all notes that there is no such treaty between the UK and the UAE hence he considers recognition of the July 2018 DIFC judgment by Sir Jeremy Cooke under common law principles. Helpfully, these principles have been summarised in a January 2013 Memorandum of Guidance as to Enforcement between the DIFC Courts and the Commercial Court, Queen’s Bench Division, England and Wales. Under discussion in the case is mostly the condition that the foreign court be a court of competent jurisdiction; that the foreign judgment be not obtained fraudulently; and that its recognition be not incompatible with English ordre public.
The judgment is an extensive treatment of the relevant principles and therefore suited to comparative materials.