Tag Archives: Congo

Case of the Cay Commissions Import Export v. Congo

Colgolese 787

The case of the day is Commissions Import Export S.A. v. Republic of the Congo (D. Utah 2016). The Congolese government failed to pay Commissions on public works and materials contracts in the 1980s. An arbitral tribunal issued an award in favor of Commissions, and Commissions obtained recognition of the award in England in 2009. Commissions then brought an action in New York, which was transferred to the District of Columbia, seeking recognition and enforcement of the English judgment. That action resulted in a default judgment for approximately $630 million. Commission then registered the judgment in the District of Utah and served a subpoena on the Bank of Utah calling for information about its “role as owner trustee and security trustee” for a Boeing 787-8 Dreamliner.
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Case of the Day: Commissions Import Export v. Republic of the Congo

The case of the day is Commissions Import Export, S.A. v. Republic of the Congo (D.D.C. 2015). I’ve written about this case twice before, once in the D.D.C. and once in the D.C. Circuit. In the previous case, the question was: when a party to a foreign arbitration has obtained a judgment confirming the award from a foreign court and then seeks recognition and enforcement of the foreign judgment rather than of the award in a US court, does the statute of limitations in § 207 of the FAA preempts any longer statute of limitations available under state law governing the recognition and enforcement of foreign judgments? The D.C. Circuit said no, and so the case was back in the district court on remand to consider the merits of Commisimpex’s claim for recognition and enforcement of the foreign judgment.
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Case of the Day: Avelar v. J. Cotoia Construction, Inc.

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In the case of the day, Avelar v. J. Cotoia Construction, Inc. (E.D.N.Y. 2011), the Permanent Mission to the UN of the People’s Republic of the Congo owned land in Bronxville, New York. It hired J. Cotoia Construction as a demolition contractor, and Cotoia subcontracted with National Waterproofing Systems, LLC, which employed Avelar. Avelar was injured on the job, and he sued Cotoia and the Congolese permanent mission for damages in the Queens County Supreme Court.

At the outset of the case, Avelar served the summons and complaint (in English) on a receptionist at the mission’s premises in Manhattan. The Congolese mission never answered, but Cotoia and its insurer “forwarded various discovery materials” to the mission by mail as the case progressed. Three months after service of process, Avelar’s lawyer wrote to the mission and stated that if the mission did not answer the complaint, he would seek a default judgment. The ambassador, Raymond Serge Balé, wrote back and expressed the view that the mission was not liable, but the mission still took no action in court. Eventually, the state court awarded Avelar a default judgment against the mission in the amount of $475,000.

Avelar filed judgment liens against the mission’s real property and attached its bank account. This finally roused the mission from its slumber. The mission filed a notice of removal, removing the case to the District Court. Avelar moved to remand. The mission, joined by the United States, opposed the motion on the grounds that the service of process on the mission was flawed under the FSIA and that the resulting judgment and the liens and attachments were similarly flawed. The court denied the motion to remand on the grounds that the mission was a foreign state entitled to remove under 28 U.S.C. § 1441(d), and that the thirty-day period for removal never began to run because the mission had never been properly served under the FSIA—a point that Avelar could hardly contest.

The mission then moved to dismiss for want of personal jurisdiction and to vacate the state court’s default judgment and the liens and attachments.

Rule 60(b) provides:

On motion and just terms, the court may relieve a party or its legal representative from a final judgment, order, or proceeding for the following reasons:
* * *
(4) the judgment is void.

This judgment was void because both in general and in FSIA cases, a judgment is void if personal service of the summons and complaint was not properly effected. There is no question that service was improper under the FSIA—a point the judge explained in detail but we will not rehash here. Thus the judgment and the post-judgment remedies that Avelar obtained were vacated. The post-judgment remedies were also improper because under Article 22 the Vienna Convention on Diplomatic Relations, the mission premises are “inviolable” and the “premises of the mission, their furnishings and other property thereon” are “immune from search, requisition, attachment or execution.” The precedents also hold that bank accounts used for diplomatic purposes are immune from execution, since under Article 25, the US is required to “accord full facilities for the performance of the functions of the mission.”

The court went on to dismiss for want of personal jurisdiction, because under the FSIA, proper service is a prerequisite to the exercise of jurisdiction.

Surely the Congolese government could have acted more promptly, but this case is correctly decided on all points.