General Observations
1.1 Definitions
In most circumstances,the judgment of a national court has no independent force outside the forum’s territory,given the nature of judicial sovereignty.Thus,most courts will and can enforce their own judgment only against assets located within their territorial jurisdiction; likewise,most courts will only infrequently attempt to preclude re-litigation in foreign forums of claims already decided in a proceeding.As a general rule,a judgment of one country’s courts does not automatically gain extraterritorial recognition and enforcement in another country,a judgment will operate in foreign states only if the courts of those states are willing to provide assistance by recognizing or enforcing the judgment:“[A]s an act of government,a judgment’s effects are limited to the territory of the sovereign whose court rendered the judgment,unless some other state is bound by the treaty to give the judgment effect in its territory,or unless some other state is willing,for reasons of its own,to give the judgment effect.”4
What merits our notice is that “recognition” and “enforcement” of foreign judgments are related,but distinct concepts.The “recognition” of a foreign judgment occurs when a domestic court relies upon a foreign judicial ruling to preclude litigation of a particular claim,or issue,on the ground that it has been previously litigated.Recognition is akin to the doctrine of res judicata.In contrast,the “enforcement” of a foreign judgment occurs when a court affirmatively uses its coercive powers to compel a defendant to satisfy a judgment rendered abroad.The enforcement of foreign judgment is typically sought by a plaintiff who has obtained a money judgment in foreign proceedings that the defendant refuses to satisfy.
To be more specific,there can be no enforcement of a judgment without recognition; but there may be recognition without enforcement.Some judgments cannot be enforced; for example,merely declaratory judgments,divorce or nullity decrees,and all judgments dismissing an action (unless there is an order as to costs).Here the only question arising is whether they are to be “recognized” in a foreign country,or as Chinese jurists often put it,whether they are “valid” in another country.5 The recognition of a foreign judgment requires less than its enforcement.No enforcement is possible without an authoritative act of the domestic court allowing the execution of the judgment.Mere recognition needs no act of this kind.Apart from this,however,the conditions of recognition are practically the same as those required for enforcement.
1.2 Theoretical Basis for Recognition and Enforcement
In principle,the powers of a court of a certain country are territorially limited; their judgments have no effect beyond the jurisdiction in which they are given,then,why do modern trends reveal that foreign judgments are more frequently recognized and enforced provided that certain requirements are satisfied?
There are,broadly speaking,three theories which may justify recognition and enforcement of foreign judgments:
The first is the theory of obligation which is predicated on the notion that if the judgment originating court assumed jurisdiction on a proper basis the court’s judgment should,prima facie,be regarded as creating an obligation between the parties to the foreign proceedings which an foreign court ought to recognize and,where appropriate,enforce.The doctrinal underpinning is that a foreign judgment which orders a defendant to pay damages is to be regarded as creating a debt which the claimant can enforce in the second jurisdiction.
The obligation theory is not without a panoply of perceived advantages and provides a circuitous avenue to effect convenient outcomes.As commentators have suggested,acceptance of the doctrine that judgment creditor is enforcing a legal right or obligation brings the matter within the fold of private international law.6 Additionally,the theory is helpful in promulgating a legalistic explanation for the demarcation between domestic and foreign judgments.If a court is viewed as enforcing the foreign judgment,rather than the obligation created by the foreign judgment,then it remains problematic to explain the cause of action does not merge with the foreign judgment as it would in the case of a domestic judgment.
The difficulty with the obligation theory,as presented,is that the explanation put forward for its adoption is a rhetorical one.Indeed,as one scholar has identified,the whole premise is circuitous.The rationale is that a foreign judgment is enforceable because it creates a binding obligation against the defendant to pay the judgment sum.It is unclear,however,why we should view the foreign judgment as creating that obligation and why the mythical and illusory obligation should be enforced domestically.A purported answer,that of allegiance to the foreign sovereign per se,is palpably inapt.The illogicality of this viewpoint was intemperately highlighted by the English Court of Appeal in Adams v.Cape Industries Plc.,7 which stated “the idea of a foreign company of manufactures,present in the U.K.for a few days only through having set up a stall at an exhibition,thereby incurred a duty of fealty to the King-Emperor is surely fanciful.”8 Moreover,there is a logicality gap in explaining why foreign judgments on status are recognized “even though they do not,in any meaningful sense,impose obligation.”9 Overall it is submitted that the relevant determinants at play in this branch of private international law are far more convoluted than is suggested by simple recantation of the obligation theory.
The second theory,that of reciprocity,is conceptually simpler than that of obligation.The premise is that the courts of country A should recognize and enforce the judgments of country B if,mutatis mutandis,the courts of country B recognize and enforce the judgments of country A.This theory is rooted in commercial considerations,and has been adopted by various international conventions,say,the Brussels Convention,and subsequently the Lugano Convention.Self-interest may play an important role in the enforcement of foreign judgments.The self-interest are founded in the notion that we stand to benefit by enforcing foreign judgments or (a step remoter) that it would do our disadvantage if other countries did not enforce our judgments.The hopeful anticipation is founded on a contingency:“[W]e do justice that justice may be done in return.”10
The third theory on foreign recognition is that of comity.11 The customary international law principle of comity has historically been relied upon as an argument for judicial restraint.Comity is the general notion of “friendly dealings between nations at peace,”12 and such,it applies not just to the judiciary,but also to the policy-making bodies of the nation.The most well-known definition of comity is arguably that of Gary J.given in the U.S.Supreme Court case of Hilton v.Guyot:
Comity,in the legal sense,is neither a matter of obsolete obligation on the one hand,nor of mere courtesy and good will upon the other.But it is the recognition which one nation allows within its territory to the legislative,executive,or judicial acts of another nation,having due regard to international duty and convenience,and to the rights of its own citizens or of other persons who are under the protection of its laws.13
Though the theory has traditionally been supported by many scholars and the laws of various countries,it has been criticized as being “uncertain in status and hollow in content.”14 It is viewed as uncertain in status because it resides in the twilight zone between the realm of obligations and the realm of non-obligation.Comity is denigrated as hollow in content because it represents “a general mode of expression that at most expresses an attitude or disposition and on analysis is simply circuitous.”15 Nevertheless,the essence of the policy encompassed in the notion of comity is that of propagating,to use some frequently used terms,goodwill,cooperation,courtesy and mutual respect among states.These values,“warm and fuzzy though they may be,” are vital to the establishment and maintenance of a stable international community.16
1.3 Conditions of Recognition and Enforcement(https://www.daowen.com)
It is self-evident that,whichever theory is adopted,for a foreign judgment to be recognized and enforced,certain criteria must be met,and it is beyond the realms of feasibility to expect a court to give effect to a foreign judgment unconditionally.Though different countries impose different requirements,certain ones are commonly shared in order for a judgment to be recognized and enforced.In broad terms,these are:
(1) The judgment must have been delivered by a Court of Law.It does not matter whether it was a court established by the country,or by a smaller community,or by several countries under an international convention,or whether it was an ecclesiastical court.Private arbitral tribunals,on the other hand,are not judicial courts in the strict sense of that term,since their decisions (awards) cannot be executed within the country where they have been delivered unless an enforcement order has been made by the court of that country.
(2) The foreign court must have been a court of competent jurisdiction.For a foreign judgment to be recognized,it must have been given by a court of competent jurisdiction.By this,one means not that the relevant foreign court considers itself to have jurisdiction but that the rules of domestic private international law indicate that the foreign court is competent to exercise jurisdiction.
(3) The judgment must be final and conclusive.It is not enough that the foreign court is competent,it must be shown that the judgment is final and conclusive.Thus,where court A has given a summary judgment in proceedings in which limited defences may be raised,but the losing party may request a full hearing before the same court at which all defences can be raised,it cannot be said that the judgment is final and conclusive.The same would apply to the situation where a judgment in default in appearance is given and the defendant is allowed within a certain time to move to set aside the judgment.Problems may arise when a judgment is given in court A,but there is a right of appeal to court B.In principle,if the parties do not exercise the right of appeal within the period provided by the law where the judgment is rendered,the judgment will be established as final and conclusive,but if an appeal is in process,the exercise of the right of appeal has the effect of automatically suspending the judgment,then it would seem that the judgment should not be recognized by foreign jurisdictions.
(4) The judgment must be a judgment on civil or commercial matters,including questions of status.A judgment of a penal nature or on matters of administrative law,such as revenue law,has no effect in foreign jurisdictions.It may happen,however,that a court by one judgment imposes on the defendant both damages and a fine.Some European continental countries allow such “adhesion procedure” in certain cases,while other countries do not.Under the law of most civil law jurisdictions,including China,if a judgment of this kind is severable,its civil,though not its penal,part has extra-territorial effect and will be recognized.17
(5) The judgment must not be in violation of public order of the country which is required to recognize and enforce it.It is commonly understood that if the recognition and enforcement of a foreign judgment would violate some fundamental interest,basic policy,general principle of justice,or prevailing concept of good morals in the forum,the forum will refuse to give effect to this judgment.
(6) The judgment is not inconsistent with a previous judgment pronounced by the forum.It is well established that a court will not recognize and enforce a foreign judgment if it is contrary to a prior judgment on the same subject.
(7) The judgment is not obtained by fraud,as the old rule “fraus omnia corrumpit” is applied under the law of some countries.
In general terms,if the judgment creditor can establish the elements provided by the law of the country where he requires to recognize and enforce the judgment,prima facie,the judgment is entitled to be recognized; it is then the duty of the defendant to bring forward evidence relating to one of the accepted defences,if he wishes,to persuade the court that the judgment should not be recognized.
1.4 Enforcement Procedures of Recognized Foreign Judgments
No country allows foreign judgments to be enforced by direct execution without the insertion of an authoritative act of the state in the territory of which the execution is to take place.Nevertheless,the conditions as well as the procedures on which the granting of execution depends are not the same in every country.German law,French law and English law,inter alia,are of particular of representativeness.[1]
Under German law,a foreign judgment which fulfils the conditions of recognition can be enforced if the admissibility of execution has been pronounced by an “executive judgment” of a German court; this judgment must be delivered without examination of the question whether the foreign court has correctly applied law which according to its conflict rules governs the case.18
French law,on the other hand,allows the French court before giving the exequatur (which corresponds to the executive judgment) to re-examine the case completely in order to make sure that both in fact and in law the judgment is satisfactory; the French court has power not only to grant or refuse exequatur but also to alter the judgment by reducing the amount awarded.19
Under English law a foreign judgment,if it fulfils the conditions on which its recognition depends,constitutes a good cause of action.If one of the parties of the original procedure brings an action in an English court based on the foreign judgment (an actio iudicati),the judgment to be enforced is not the foreign judgment itself but the judgment delivered upon it by the English court.The English courts do not have the right that French courts have assumed to re-examine the whole case and to refuse the exequatur if they hold the foreign judgment bad.Direct enforcement of a foreign judgment without the necessity of previously obtaining an English judgment upon on an actio iudicati has been allowed with a vey limited scope and on the basis of reciprocal legislative arrangements with selected foreign jurisdictions for the mutual recognition and enforcement of each other’s judgments.20