EU Judgment Recognition

Automatic Recognition

The EU Judgment Regulation allows for almost automatic recognition of judgments between EU Member States. The judgment Regulation is directly effective law in all of the European Union’s member states.  It overrides any inconsistent laws.

Originally, steps were required to recognise the judgment. Under the amended Regulation, recognition is automatic, and the onus is on the defendant to challenge the recognition of the judgment.

A judgment is any order given by a Court or tribunal of an EU member state. It does not matter what it is called. There must be a final judgment. The  defendant must have had an opportunity to take part in the proceedings. A degree of specific performance injunction or money judgment is equally entitled to recognition.

Application

The EU rules apply to civil and commercial matters. The Court whose judgment it is sought to recognise may verify whether this is the case. Arbitration does not fall within the Judgment Regulation, although other provisions apply. See the sections on arbitration.

The regulation does not apply to pre-interlocutory pre-trial decisions relating to procedural matters. Provisional measures such as pre-trial Injunctions are within the Regulation.

There are separate provisions in the Regulation relating to Court settlements.

The Regulations do not apply to internal recognition and enforcement of judgments in the United Kingdom as between England and Wales, Scotland, and Northern Ireland.

There is controversy about whether a foreign judgment may be enforced in defiance of a valid arbitration clause. If the defendant did not submit to the foreign jurisdiction, it may arguably not be enforceable.  On the other hand, there are cases to the contrary.

Former Procedure

The basic principle of the EU legislation is that civil and commercial judgments must be automatically recognised. The Court has no choice. This may even apply if another EU Court has assumed jurisdiction, say, over a third-party non-EU defendant in circumstances that the domestic Court would not normally accent.

There is no need to establish that the original Court was competent. The foreign judgment must be produced to the Court.

The original procedure involved making an Application to the High Court Master. As long as the necessary formalities had been satisfied, the Master was to order enforcement without a review of the merits. If the Court refuses enforcement, an appeal might be made. The first Appeal is to the High Court.

The amended Regulation requires automatic recognition. The onus is on the other party to challenge recognition.

Recast Judgment Regulation

The Judgments Regulation has been recast by the 2012 Regulation.  It applies to civil, commercial cases but not criminal law, family law, bankruptcy and inheritance matters and certain other specified matters.

The earlier procedure required an application for recognition of a judgment in the state of enforcement.  Under the new procedure, a judgment given in one state is recognised in the other state without any special procedure. If it is enforceable in the state of origin, it is enforceable in the other EU State without any direct declaration of enforceability.

In order to give the person against whom enforcement is sought notice of a judgment given in another State, a certificate concerning a judgment in civil and commercial matters must be drawn up.  A model is provided in the Regulation.  It is accompanied by the judgment if not already served. It should be served on that person in a reasonable time before the first enforcement measure.

The person against whom enforcement is sought may apply for refusal of the recognition or enforcement of the judgment if he or she considers one of the grounds for refusal apply. The grounds are set out in the Regulation.  The Member States must notify the Commission of the competent courts to which applications must be submitted.

Rules of Jurisdiction

There must be a connection between the proceedings and the territory of the state concerned.  Common rules of jurisdiction apply when the defendant is domiciled in one state.  A defendant not domiciled in a state should be subject to the national rules of jurisdiction of the state whose court is seised of the dispute.

In order to ensure the protection of consumers and employees, to safeguard the jurisdiction of the courts,  certain rules of jurisdiction apply regardless of domicile.  They may also apply in some certain circumstances to parties domiciled outside the EU.  This would include, for example, where the courts of a Member State have had jurisdiction conferred on them by agreement between the parties.

The revised regulations improve the effectiveness of a choice of law agreements. Where parties have designated a particular court, or courts to resolve the dispute, the priority is given to the court chosen to decide on jurisdiction regardless of whether it is first or second seised.  Other courts must suspend proceedings until the chosen court has established or where the agreement is invalid, declined jurisdiction.

Denial of Recognition

There are extremely limited bases for refusal to recognise. The court decision may not be denied recognition on its merits. The recognising court must follow the determination of the facts made by the original court.

There are some defences. If an appeal is pending in the original court, proceedings for recognition in other EU states may be stayed. The court recognising may not usually review the jurisdiction of the original court. It is a matter for the original court to decide its jurisdiction. It does not matter that the original judgment is undefended.

A judgment shall not be recognised if it is irreconcilable with a judgment given in the dispute between the same parties in the state in which the recognition is sought. In order to be reconcilable, they must entail mutually exclusive legal consequences.

Valid Agreement

If the original court assumed jurisdiction notwithstanding the agreement to refer to the courts of another state, this is not a defence if the defendant did not challenge the jurisdiction in the original proceedings.

A defendant cannot ignore the foreign proceedings and hope to use the provision to resist enforcement of the judgment. He must challenge the foreign court proceedings.

Public Policy

A judgment will not be recognised if the exercise of the jurisdiction is in breach of the mandatory provisions relating to insurance. consumer contracts or exclusive jurisdiction clauses.  It does not apply to employment contracts.

A judgment will not be recognised if it is manifestly contrary to Irish public policy. Public policy has a very restrictive scope in this context. The foreign judgment must breach fundamental principles of law in Ireland. This may, for example, apply to the manifest breach of human rights.

If the foreign judgment has been obtained by fraud, it may be refused recognition on the grounds of public policy.

Irregularity

A judgment will not be recognised if

• the document which instituted proceedings was not served on the defendant or in sufficient time and a sufficient way to enable him to arrange his defence.
• given in default of appearance if not served a document which instituted proceedings or equivalent document or in sufficient time in such a way as to enable defence.

This does not apply if the defendant took part in the proceedings. This will apply even if he appeared to contest the jurisdiction or ask for postponement.

A formal irregularity in service will not debar enforcement if it does not prevent the defendant from arranging his defence. It will not be recognised if the method served fails to give him an opportunity to prepare his defence.