Case of the Day: Hilt Construction v. Permanent Mission of Chad
Posted on October 16, 2017
The case of the day is Hilt Construction & Management Corp. v. Permanent Mission of Chad (S.D.N.Y. 2017). Hilt claimed the Mission of Chad to the UN owed it more than $1 million for construction work. Hilt first sued the Mission and the Ambassador. The court dismissed the claim against the Ambassador on the grounds of diplomatic immunity, and it dismissed the claim against the Mission without prejudice on the grounds that Hilt had failed to serve it with process. Hilt then brought a new action against the Mission served process on the as required by the FSIA. The Mission defaulted, and Hilt obtained a default judgment. Hilt, a writ of execution in hand, garnished the Mission’s bank account, apparently without giving the Mission notice of the default judgment as required by the FSIA, causing the Mission finally to appear in the case, and the United States to submit a statement of interest outlining the FSIA’s requirements for attachment and execution of foreign sovereign assets and the FSIA’s requirements for notice of default judgments. The court vacated the writ of execution. The Mission moved to set aside the judgment.
The court found that Chad’s default was not willful. Because the envelope with the summons was attached to the Minister of Foreign Affairs personally (the FSIA requires the document to be sent to the minister), and because the minister was “not present at the time the package was received, no one else in that office opened the package.” The court accepted this explanation, which may have been negligent but was not willful. The court also found that Chad had a colorable defense to the claim of breach of contract. Thus it was appropriate to set the default aside.