The Judgments Convention: Let’s Do This!

The Death of General Warren at the Battle of Bunker Hill by John Trumbull

    The Diplomatic Session of the Hague Conference on Private International Law will meet beginning tomorrow, and the delegates are expected to adopt the Convention on the recognition and enforcement of foreign judgments in civil or commercial matters—the long-awaited Judgments Convention. The prospects for American ratification of the new Convention are uncertain. I think we all should do what we can to promote the Convention. Here’s why.

    Let’s say you are like me and you think that the only criterion your country should use in deciding whether to enter into a treaty is, “is this treaty in our national interest?” You are not interested in treaties that make sense only because they benefit others or only because they benefit the world generally or the international system generally. You might wonder whether the Judgments Convention is in the interest of the United States, and you might be worried that the treaty benefits foreign countries at our expense. Now foreigners will be able to get US courts to recognize and enforce foreign judgments obtained against Americans, or American businesses. Au contraire! Here is the key point: the states of the United States are already very liberal in recognizing and enforcing foreign judgments—much more liberal than are many foreign jurisdictions when asked to recognize or enforce American judgments. The main reason the Convention is in our national interest is that it will improve the ability of American judgment creditors to enforce their US judgments abroad, while not dramatically changing the ability of foreign judgment creditors to enforce their foreign judgments here. In other words, we are already doing what the Convention would require.

    We can put a little meat on the bone by comparing the grounds for non-recognition in the Convention with the grounds in the most modern US recognition statute, the Uniform Foreign Court Money Judgment Recognition Act.

    Ground for non-recognition Convention UFCMJRA
    Lack of Notice. The summons and complaint “was not notified to the defendant in sufficient time and in such a way as to enable him to arrange for his defence, unless the defendant entered an appearance and presented his case without contesting notification in the court of origin, provided that the law of the State of origin permitted notification to be contested,” or they were “notified to the defendant in the requested State in a manner that is incompatible with fundamental principles of the requested State concerning service of documents.” Non-recognition is discretionary. (Art. 7(1)(a)). “The defendant in the proceeding in the foreign court did not receive notice of the proceeding in sufficient time to enable the defendant to defend.” Non-recognition is discretionary. (§ 4(b)(1)).
    Fraud in the proceeding. “The judgment was obtained by fraud.” Non-recognition is discretionary. (Art. 7(1)(b)). “The judgment was obtained by fraud that deprived the losing party of an adequate opportunity to present its case.” (§ 4(c)(2)).
    Public policy. “Recognition or enforcement would be manifestly incompatible with the public policy of the requested State, including situation where the specific proceedings leading to the judgment were incompatible with fundamental principles of procedural fairness of that State and situations involving infringements of security or sovereignty of that State.” Non-recognition is discretionary. (Art. 7(1)(c)). “the judgment or the claim for relief on which the judgment is based is repugnant to the public policy of this state or of the United States.” Non-recognition is discretionary (§ 4(c)(3)).
    Choice of Forum. “The proceedings in the court of origin were contrary to an agreement, or a designation in a rust instrument, under which the dispute in question was to be determined in a court other than the court of origin.” Non-recognition is discretionary. (Art. 7(1)(d)). “The proceeding in the foreign court was contrary to an agreement between the parties under which the dispute in question was to be determined otherwise than by proceedings in that foreign court.” Non-recognition is discretionary. (§ 4(c)(5)).
    Res judicata. “The judgment is inconsistent with a judgment given in the requested State in a dispute between the same parties,” or “the judgment is inconsistent with an earlier judgment given in another State between the same parties on the same subject matter, provided that the earlier judgment fulfils the conditions necessary for its recognition in the requested State.” Non-recognition is discretionary. (Art. 7(1)(e) & (f)). “The judgment conflicts with another final and conclusive judgment.” Non-recognition is discretionary. (&sect. 4(c)(4)).
    Personal jurisdiction. (The Convention has a list of thirteen grounds for personal jurisdiction, at least one of which must be satisfied in order for the judgment to be eligible for recognition. (Art. 5(1)). “The foreign court did not have personal jurisdiction over the defendant.” The Act lists six sufficient bases of personal jurisdiction. Non-recognition is mandatory. (§§ 4(b)(2), 5(a)).
    Subject-matter jurisdiction. (No specific provision, but see the discussion below). “The foreign court did not have jurisdiction over the subject-matter.” Non-recognition is mandatory. (§ 4(b)(3)).
    Crappy foreign courts. (No specific provision) “The judgment was rendered under a judicial system that does not provide impartial tribunals or procedures compatible with the requirements of due process of law,” (§ 4(b)(1), mandatory non-recognition), or “the judgment was rendered in circumstances that raise substantial doubt about the integrity of the rendering court with respect to the judgment,” (§ 4(c)(7), non-mandatory), or “the specific proceeding in the foreign court leading to the judgment was not compatible with the requirements of due process of law,” (§ 4(c)(8), non-mandatory).
    Forum non conveniens. (No specific provision). “In the case of jurisdiction based only on personal service the foreign court was a seriously inconvenient forum for the trial of the action.” Non-recognition is discretionary. (§ 4(c)(6)).

    As you can see, almost all of the grounds for non-recognition in the UFCMJRA are also in the Convention.1 So the United States gains a lot and gives up nothing by joining the Convention. There is one major caveat, though: the Convention lacks an exception to recognition in cases where the foreign court is crappy, or as David Goddard put it more correctly, no mechanism “to address the risk that judgments from a Contracting state may be affected by a systemic lack of due process in that State.” This is a real concern, although in practice the United States has enforced judgments from many countries whose court systems are subject to criticism and has only rarely declared that a jurisdiction is systematically deficient. One possible solution is so-called “bilaterlization,” under which each party to the Convention would decide in some fashion whether it would categorically refuse to enforce judgments from certain other states party to the Convention. But in light of the history Goddard recounts, bilateralization is probably a non-starter. a more practical solution, and one that I think will satisfy the US concerns, is simply to note that US public policy likely does not permit recognition of a judgment rendered by a judicial system that does not accord due process to litigants, and that in light of the Due Process Clause there is a constitutional tint to the argument, too. So it seems to me there is little real chance that the US courts will be recognizing judgments from crappy courts if we ratify the Convention.

    And so, I reiterate the point I have made before: we should sign and ratify the Convention because it is in the national interest. Let’s do this!

  1. I am leaving aside issues about the scope of the Convention, e.g., should it apply to intellectual property judgments, non-monetary judgments, etc.

5 responses to “The Judgments Convention: Let’s Do This!”

  1. JMS

    Does the Convention apply to injunctive judgments or only to money judgments? There might be some more serious concerns (not all of which would fit neatly into the “public policy” non-recognition ground) if U.S. courts were required to honor foreign injunctions.

    1. The issue you raise is up for consideration at the Diplomatic Session. It is discussed in Preliminary Document No. 3. The best view is that the Convention does not require recognition and enforcement of, say, orders requiring payment of fines to compel compliance with an injunction, but the delegates may choose to make that clearer by inserting additional language.

      By the way: I have kept your comment available, but it uses a fake email address and I require commenters to use real email addresses, even if they use pseudonyms. In the future, please use your real email address, which I will not publish or make any use of (other than to make sure that commenters are not commenting using more than one pseudonym). Thanks!

  2. Alexander Blumrosen

    I agree with you that public policy will save US litigants from the crappy court problem. What will ratification in the US look like? Will NCUSSL want States to implement state law equivalents, updating their Uniform Laws? Or do we get a Federal Law, like the Arbitration Act (which did not prevent a bunch of States from enacting their own international arbitration statutes, to the confusion of many litigants)? Do you know if ACPIL or “L” have made any recommendations ?

    1. That is one of the known unknowns, Alex. My own view is that a compromise is possible—perhaps COCA could be implemented in a federal statute analogous to the FAA and the Judgments Convention implemented in state law. But I know some people who think the Judgments Convention should be implemented in federal law and COCA in state law! In short, I don’t know that anyone knows the answer to your very pertinent question.

  3. […] declaration. This is a potential answer to the problem of crappy courts I discussed in my last post on the Convention. The form of “bilateralization” the delegates adopted is “opt-out,” and can […]

Leave a Reply

Your email address will not be published. Required fields are marked *

Thank you for commenting! By submitting a comment, you agree that we can retain your name, your email address, your IP address, and the text of your comment, in order to publish your name and comment on Letters Blogatory, to allow our antispam software to operate, and to ensure compliance with our rules against impersonating other commenters.