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Business and Company Law Debt Problems | Bankruptcy Transnational Litigation

Enforcing US Court Judgments in Ireland-The Common Law Principles

summary judgment

As there is no agreement in place between the United States and Ireland for the automatic recognition and enforcement of Judgments obtained from a court in the US in Ireland, it will be necessary to rely on common law rules.

This can pose major difficulties for holders of judgments against debtors from outside Ireland.

In fact, there is no bilateral treaty or multilateral international convention in force between the United States of America and any other country on a reciprocal recognition and enforcement of judgments.

The Irish common law rules/principles are quite restrictive and enforcing non-EU judgments in Ireland can be problematic as a consequence.

Common law principles

The common law principles that the Irish Courts will rely on are

  1. The US judgment must be for a liquidated sum, that is a definite monetary value
  2. The US judgment must be final and conclusive
  3. The US judgment must be granted in a Court of competent jurisdiction.

Number 1 above is obvious-you either have a judgment for a definite sum or not.

Likewise with number 2-the legal proceedings must have come to an end with no opportunity to appeal the judgment and the judgment must have been achieved following the correct procedures in the state in the US which granted the Judgment.

 Court of competent jurisdiction

Number 3 above can be the most problematic as a result of a case called Rainford v Newell Roberts [1962] IR 95 where a Judgment was obtained by Rainford in the UK and sought to enforce the judgment in Ireland. (This situation would not arise now as a result of both countries mutual recognition of judgments due to various EU law and international conventions but is illustrative of the common law principles involved in seeking to have the US judgment enforced here)

This problem centres primarily on the question of proper service of the proceedings on the Defendant, as accepted by Irish rules of private international law.

In Rainford v Newell-Roberts the defendant had not been in the UK when served with the legal proceedings and had therefore not submitted to the jurisdiction of the English Courts and as a consequence the Irish Courts did not allow enforcement of the Judgment.

Where the dispute or Judgment arises as a result of breach of contract and the contract provides that a foreign jurisdiction will have exclusive jurisdiction in the event of a dispute the Irish Courts would be very likely to stay any proceedings instituted in Ireland and recognise the exclusive jurisdiction clause in the contract.

Grounds on which Judgment will be refused

In addition to the above considerations and criteria the Irish Courts will refuse to grant Judgment in Ireland where

  1. The Judgment would violate Irish public policy
  2. The foreign judgment was obtained by fraud
  3. The foreign judgment is in breach of natural justice
  4. The foreign judgment cannot be reconciled with an earlier foreign judgment.

Flightlease (Irl) Ltd (In Vol Liq) & Cos Act [2012] IESC 12

This 2012 decision of the Supreme Court in Ireland is instructive and helpful.

In Flightlease (Irl) Ltd (In Vol Liq) & Cos Act [2012] IESC 12 the Supreme Court was invited to accept the appropriate basis upon which the common law in this jurisdiction should recognise an in personam order of a foreign court. Flightlease argued that the traditional test as set out in Dicey (and in particular Rule 36) represents the current law in this jurisdiction. Swissair contended that the courts in this jurisdiction should follow the lead of Canadian courts and adopt a ‘real and substantive connection’ test.

(Read the full decision in this case here)

According to Rule 36 of Dicey if a judgment debtor was, at the time the proceedings were instituted present in a foreign country or if the judgment debtor submitted to the jurisdiction of the courts of the foreign country the Irish courts would recognise and enforce a judgment of a court of that country. (Dicey, Morris & Collins on Conflicts of Laws 14th edition (“Dicey”))

“Rule 36. Subject to rules 37 to 39, a court of a foreign country outside the United Kingdom has jurisdiction to give a judgment in personam capable of enforcement or recognition in the following cases:

First case. If the judgment debtor was, at the time the proceedings were instituted, present in the foreign country.

Second case. If the judgment debtor was claimant, or counterclaimed in the proceedings in the foreign court.

Third case. If the judgment debtor, being a defendant in the foreign court, submitted to the jurisdiction of that court by voluntarily appearing in the proceedings.

Fourth case. If the judgment debtor being a defendant in the original court, 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 Supreme Court decided that to follow the lead of the Supreme Court in Canada would lead to the Supreme Court in Ireland exceeding it’s judicial function and that the correct position is as set out by Rule 36 in Dicey outlined above.

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Transnational Litigation

Hague Convention Service in Ireland-The Hague Service Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters

hague-convention-service
Hague Convention Process Serving

Ireland is one of the signatories to the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters.

The Federal Rule of Civil Procedure 4(f) provides that service on an individual in a foreign country may be served by any internationally agreed means of service such as the methods authorized by the Hague Convention.

The Supreme Court of the United States has recognised the mandatory nature of the Hague Convention in

VOLKSWAGENWERK AKTIENGESELLSCHAFT v. SCHLUNK, 486 U.S. 694 (1988).

We acknowledged last Term, and the Court reiterates today, ante, at 699, that the terms of the Convention on Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, Nov. 15, 1965, 1969. 20 U.S. T. 361, T. I. A. S. No. 6638, are “mandatory,” not “optional” with respect to any transmission that Article 1 covers.

Article 1 of the Convention provides that the Convention “shall apply . . . where there is occasion to transmit a judicial . . . document for service abroad.” “Service” means a formal delivery of documents that is legally sufficient to charge the defendant with notice of a pending action. Source: US Supreme Court.

You may think therefore that it is a straightforward matter to effect service on Irish citizens or residents in litigation cases as the Hague Service Convention provides for a number of methods of service including

  • Post or mail with a return receipt (however, see caveat below re service by mail)
  • Directly through the Central Authority of the country in which you wish to serve documents
  • Instructing a local solicitor in Ireland to deal with the matter of service.

However a quick look at the background of Ireland’s ratification of the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matter is worthwhile and may save you a lot of money and heartache.

Ireland and the Hague Convention

The Hague Convention provides for a government sponsored “Central Authority” which oversees the service of legal papers from other signatory countries to the Hague Convention. In Ireland, the Central Authority is the Master of the High Court.

As the Central Authority, the Master of the High Court ensures that the document is properly served, either in accordance with domestic forms of service, or in accordance with a particular method requested by the applicant, unless the particular method is incompatible with Irish law.

Ireland ratified the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters in 1994. However, in doing so Ireland made an objection pursuant to Article 10 and made declarations pursuant to Articles 3 and 15.

The objection Ireland made under Article 10 was to

i. the freedom under Article 10(b) of judicial officers, officials or other competent persons of the State of origin to effect service in Ireland of judicial documents directly to judicial officers,officials or other competent persons and

ii. the freedom under Article 10(c) of any person interested in a judicial proceeding to effect service in Ireland of judicial documents directly through judicial officers, officials or other competent persons.

However this objection is not intended to preclude any person in another contracting State who is interested in a judicial proceeding or his lawyer, from effecting service in Ireland directly through a solicitor in Ireland.

This objection raises two questions which have to be answered before the service of foreign process in Ireland is valid.

1) Whether the mode of service followed is valid under the law of the State of origin and
2) The competency of the Irish official who effects service.

Under the terms of this objection therefore there are only two officials who possess the necessary competence to effect service under the Convention in Ireland.

These are the Central Authority in Ireland (the Master of the High Court) and a solicitor in Ireland.

No one else is to validly effect service in Ireland under the terms of the Convention.

This means that although service may ultimately be valid according to the law of the State of origin, it is not good service for the purposes of the Convention.

So if you wish to ensure valid service in accordance with the Hague Convention, the use of legal services agents or town agents or law agents will not suffice and will not be good service in accordance with the Hague Convention.

This is not explicitly stated anywhere but arises by implication from Ireland’s objection to the ratification of the Hague Convention as outlined above.

Unfortunately many foreign legal firms are unaware of this limitation and make the mistake of engaging the services of a law agent of one kind or another, much to their detriment because service can only be effected direclty through the Central Authority or by using an Irish solicitor who will submit the documents and request form on your behalf.

(Note: in information provided by the Central Authority in Service Convention questionnaires in 2003 and/or 2008 the Irish authorities provided this information:

Forwarding authorities
(Art. 3(1)):
– the Central Authority;
– a practising Solicitor;
– a County Registrar; and
– a District Court Clerk.

Service by mail/post

Firstly whilst service by mail or post may appear to be the least expensive method you may run into problems in enforcing your judgment in Ireland as there is no treaty in force between the US and Ireland in relation to enforcement of judgments obtained in the US against assets in Ireland of the defendant.

US Courts are also divided as to the propriety of service by post with conflicting judgments being handed down in Florida and other states as set out in this document from the American Bar website.

In addition, you run the risk of only proving that you sent process to a particular address and not actually serve the person in question. This will no doubt lead to difficulty.

Service through the Central Authority

Effecting service directly through the Central Authority of Ireland (the Master of the High Court) by sending a request for service directly to the Central Office of the High Court is problematic also because it is slow and there are only a very small number of personnel to deal with a growing number of cases and to effect service.

Service by an Irish Solicitor

The best and most effective method if you think that ultimately you will need to enforce your Judgment against the assets of an Irish defendant is to instruct an Irish solicitor.

He/she will deal with the paperwork, liaise with Central Office and arrange service of the documents directly provided the request for service requests that the solicitor be permitted to serve on the Defendant which is common.

Once service is effected by the Irish solicitor he sends one set of papers back to the Central Office of the High Court who then certify service. It is this certificate of service which is accepted as proof of service under the Hague Convention.

In summary Ireland’s ratification of the Hague Convention was done in such a way as to leave only 2 avenues of good service in accordance with the Hague Convention open to you:

  • through the Central Authority
  • by instructing a solicitor in Ireland.

You will need to fill out the Request for Service form correctly.

You may also want to read enforcing US judgements in Ireland-the common law principles.

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Debt Problems | Bankruptcy Transnational Litigation

The European Order for Payment Regulation Procedure

european-enforcement-order

The European Order for Payment Regulation is an attempt to put in place an EU wide procedure for inter EU state debts.

The whole purpose of the regulation was to put in place a uniform procedure across member states for the collection of uncontested debts.

It is an additional procedure to existing home state procedures and the obtaining of a European Enforcement Order in the creditor’s home state.

Conditions for issuing of an EOP

To obtain an EOP

  1. The debt must be inter-state,
  2. Must be an uncontested claim for a discrete amount of money.

In Ireland the application is made to the Master of the High Court and the order is made on the basis of the affidavit sworn by the creditor.

Once the order is granted it must be served on the debtor; if the debtor does not pay the amount due he has 30 days to lodge a Statement of Opposition.

If he lodges the Statement of Opposition the case proceeds in the courts of the state in which the European Order for Payment.

If he does not lodge a Statement of Opposition then the Master issues a Declaration of Enforceability which means the order is enforceable in all member states of the EU.

However a member state may refuse to enforce a European Order for Payment in specific circumstances such as where the order is irreconcilable with an earlier decision given in any member state in relation to the same case.
If you have a question or concern, please use the contact form below. We respond within 24 hours, guaranteed.

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Debt Problems | Bankruptcy Transnational Litigation

Enforcing UK Debt in Ireland-Debt Collection in Ireland for UK Creditors

enforcing judgment

 

If you have secured a judgment in the UK in respect of a debt but find that your debtor is now living in Ireland, how do you enforce your debt?

Article 33 of the Brussels I regulation stipulates that any judgment obtained in a member state will be recognised in other member states without any special procedure required.

But how do you enforce your UK judgment in Ireland?

Order 42A of the Rules of the Superior Courts in Ireland provides the procedure which involves making an application to the Master of the High Court in the first instance.

This is an ex parte application (only one party required, there is no need to serve any papers on the debtor at this stage). Your application needs to be supported by an affidavit which shows

  1. Your UK judgment,
  2. If the judgment in the UK was obtained by default you will need to demonstrate that the debtor was properly served in the UK with the legal proceedings in the first place,
  3. Documents that show that the judgment obtained in the UK is enforceable and has been served,
  4. An Annex V certificate which will be provided by Court officials in the UK.

There are a number of other averments or statements which will need to be in your affidavit including an address in Ireland for the service of documents on the party making the application and the grounds on which the right to enforce the judgment is vested in the party making the application.

 

Declaration of enforceability

Provided your papers are in order and your application is successful then the Master of the High Court will declare your UK judgement enforceable immediately.

Once this declaration of enforceability is granted it affords the same power to the UK judgment as if it was a judgment made in the High Court in Ireland.

This declaration of enforceability then needs to be served on the debtor along with the Judgment and a Notice of Enforcement.

At this stage the debtor has a period of time within which to appeal the Master’s order which can range from 1 month to 2 months.

Only after this period has expired will the Execution Order in respect of your Judgment issue.

UK Judgment not recognised

A UK or EU judgment will not be recognised in Ireland in only a narrow range of circumstances with the most common situation being where the original proceedings were not correctly served on the debtor.

 

Should you need any assistance in Ireland with having your UK judgment recognised and enforced in Ireland we are happy to assist-please use the Contact Us form with your query.

Categories
Debt Problems | Bankruptcy Transnational Litigation

Enforcement of Non EU Judgments in Ireland

hague-convention-service
Hague Convention Process Serving

Unlike procedures laid down under the Brussels I Regulation or Lugano Convention for the enforcement of judgments between EU member states there is no formal procedure in the Rules of the Superior Courts in Ireland for the enforcement of judgements from non EU countries such as the United States, Canada, India etc.

Strictly speaking the procedure therefore is that if you have obtained a judgment, in the United States for example, you are obliged to commence proceedings anew in Ireland under the Summary Summons procedure.

The purpose of these proceedings would be to obtain a Judgment in the Irish courts in the terms of the foreign judgment.

And the principles to be applied in granting or refusing a Judgment in Ireland to be applied by the Irish courts are the common law rules or principles.

However the Irish Courts can enforce a non EU judgment under the common law rules of enforcement. To be successful with an application for recognition of a non EU judgment the following are fundamental-

1. The judgment must be for a definite monetary sum

2. The judgment that was obtained must be conclusive and final

3. The Defendant had adequate time to defend the proceedings and must have been served with them

4. The judgment must not be irreconcilable with public policy in Ireland

5. The judgment was not obtained by deceit or fraud

6. The Court that issued the judgment must have had jurisdiction to have dealt with the dispute-it must have been a Court of Competent Jurisdiction

The Defendant could have submitted to the jurisdiction of the foreign Court as a matter of contract or by entering an Appearance to the proceedings.

The action then to enforce the US judgement is one taken at common law and the cause of action is recognition of the foreign judgment.

The question of competence of jurisdiction is an important one and it is not enough to show that the foreign Court had jurisdiction according to the conflict of jurisdiction rules in the foreign country; it must be shown that the Court was one of competent jurisdiction according to the Irish conflicts of laws rules.

Read about the common law principles used in enforcing US judgments in Ireland in the light of a February, 2012 Supreme Court decision which looks at this issue (Flightlease (Irl) Limited (in vol. liquidation) & Cos. Act, Supreme court)

An alternative way to recover a foreign judgment against an Irish debtor is to bring bankruptcy proceedings in Ireland against the debtor with the first step being to serve a demand for payment on the debtor.

However the difficulties of starting proceedings in Ireland anew are

  1. costs and
  2. statue of limitations, that is to say, you may be out of time to commence proceedings, depending on the reason for the litigation.