Case of the Day: Concesionaria Dominicana de Autopistas y Carreteras v. Dominican Republic

Welcome back, and happy new year! The case of the day is Concesionaria Dominicana de Autopistas y Carreteras v. Dominican State (D.D.C. 2012). In 2001, the Concesionaria Dominicana de Autopistas y Carreteras (CODACSA) entered into a contract with the government of the Dominican Republic to develop several highways. Under the contract, CODACSA was entitled to collect tolls in exchange for financing and construction work. But according to CODACSA, the government breached the contract by failing to provide required bank guaranties. CODACSA initiated an arbitration before the Arbitration Court of the ICC in Washington, and the tribunal found that the Dominican Republic had breached the contract and awarded more than $33 million in damages.

CODACSA moved to confirm the award in the District of Columbia. It served the papers on the Dominican Republic by private courier (DHL), and while the Republic accepted service, it did not respond to the petition. CODACSA then sought a default judgment.

The judge found that he had jurisdiction. He had subject-matter jurisdiction because under 28 USC § 1605(a)(6)(B), there is no sovereign immunity from jurisdiction “in any case … in which the action is brought … to confirm an award made pursuant to … an agreement to arbitrate, if … the agreement or award is or may be governed by a treaty or other international agreement in force for the United States calling for the recognition and enforcement of arbitral awards.” He had personal jurisdiction because the courts have personal jurisdiction over all actions against foreign states in which subject-matter jurisdiction exists and service of process has been effected.

The judge found that CODACSA was entitled to confirmation. Since the Dominican Republic had defaulted, it had not even sought to argue that any exceptions to the the requirement of confirmation applied. But under 28 USC § 1608(e), a court can enter a default judgment against a foreign state only where the claimant established its claim “by evidence satisfactory to the court.” The judge undertook his own review of the record and found that CODACSA had proved its case. 1 Easy case.

Notes:

  1. As the judge noted, it’s proper in such cases for the court to credit the claimant’s uncontroverted evidence, and in particular affidavits.

About Ted Folkman

Ted Folkman is a shareholder with Murphy & King, a Boston law firm, where he has a complex business litigation practice. He is the author of International Judicial Assistance (MCLE 2d ed. 2016), a nuts-and-bolts guide to international judicial assistance issues, and of the chapter on service of process in the ABA's forthcoming treatise on International Aspects of US Litigation, and he is the publisher of Letters Blogatory, the Web's first blog devoted to international judicial assistance, which the ABA recognized as one of the best 100 legal blogs in 2012, 2014, and 2015.

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