Foreign judgment inconsistent with a prior judgment

If a foreign judgment is inconsistent with an English judgment, it will be denied recognition as res judicata. This has arisen in the context of matrimonial judgments in

rem,^[1] but it applies equally to judgments in personam. If a foreign judgment has been given before the English court has reached its decision, it is open to the party in whose favour it was given to seek to amend his pleading and rely upon it. He will succeed if such amendment is allowed and the other party is estopped from contesting the conclusiveness of the judgment. If the foreign judgment is between the same parties there is no difficulty; if not, it may still be decisive in an English court as between persons privy to the parties.

Equally, if the foreign judgment is inconsistent with another foreign judgment between the same parties (or their privies, it is reasonable to suppose) which was earlier in time, it will be denied recognition. The general principle, that the first judgment in time prevails, is supported by the decision of the Privy Council in Showlag v Mansour? and the critical timing would appear to be that of judgment, not of other procedural steps such as the institution of proceedings." On the footing that the first judgment gave rise to an obligation on the date on which it was given, the solution in Showlag appears to be logically inevitable.

Effect and consequences of foreign judgment entitled to recognition

We now consider the effect and consequences of recognising a foreign judgment as res judicata.

If, by the application of the preceding rules, it is decided that a foreign judgment meets the requirements for recognition in favour of the party who seeks to rely on it, and therefore binds or obliges the party against whom it was given to accept it and abide by it, one must ask what consequences flow from it. In principle, three distinct consequences can be identified; they are summarised in this paragraph and examined thereafter.

First, a successful judgment creditor may seek to enforce the judgment by action in the English courts. In order to do so, he will commence proceedings to enforce the obligation or debt created by the judgment, by issuing and serving process on the defendant in the usual way.

If the defendant is out of the jurisdiction, permission to serve out in accordance with CPR rule 6.36 will have to be sought and obtained. In connection with such an application, it should be noted that this applies only to those judgments which need to be enforced by action at common law; separate arrangements exist where judgments are enforced by registration under the 1920 and 1933 Acts.^[2] Although in principle the court must also consider, pursuant to CPR rule 6.37(3), that England is the proper place in which to bring the claim, it is extremely unlikely that this will be a significant issue unless the defendant can show the absence of assets, and the highly predictable continuing absence of assets, within the jurisdiction; and even then it may make no difference. Certainly the Court of Appeal took this view in its only fully reasoned decision on the point: if the judgment creditor wishes to obtain an order which he may not be able to execute, at any rate for the time being, there is no good reason to stand in his way. The modern mobility of assets and wealth makes it prudent to be prepared.

When the defendant has been served, in or out of the jurisdiction, the claimant may consider his case sufficiently strong to apply for summary judgment. On the hearing of such application, the court will consider whether the defendant has shown a plausible defence to recognition, or any further defence to the enforcement of a judgment entitled to recognition. If the judgment debtor has a real prospect of defending the claim or issue, the court will make no order on, or dismiss, the application for summary judgment, or make a conditional order. But if the defendant has no real prospect of successfully defending the claim, there will be judgment for the claimant.

Second, a successful judgment creditor will now be precluded from electing instead to bring an action on the underlying cause of action. It may be that he has obtained judgment in his favour, but is dissatisfied with the extent of his victory. Until 1982 he would have been free, in principle at least, to put the judgment aside and bring fresh proceedings on the underlying cause of action. But statutory reform has substantially abrogated that right.

Third, a successful defendant may seek to rely on the judgment in his favour as creating an estoppel which either prevents the disappointed claimant bringing fresh proceedings on the underlying cause of action, or at least prevents the claimant seeking to reopen issues which were decided by the foreign court in favour of the defendant. These three consequences are now examined separately.

• [1] A foreign decree of nullity was denied recognition in Vervaeke v Smith [1983] 1 AC 145 on the ground that the validity of the marriage in question was already res judicata by virtue of the prior decision of an English court. 2 House of Spring Gardens Ltd v Waite [1991] 1 QB 241. 3 Applied to an arbitral award which could no longer be challenged under the Arbitration Act 1996, even though no order had yet been made giving permission to enforce it as a judgment: People's Insurance Co of China. Hebei Branch v Vysanthi Shipping Co £rrf[2003] EWHC 1655 (Comm), [2003] 2 Lloyd's Rep 617. 4 [1995] 1 AC 431. 5 The approach in The Indian Grace (No 2) [1998] AC 878, which dealt with the interpretation of Section 34 of the 1982 Act (for which, see below), was to place greater emphasis on the date of institution of proceedings. It is not expected that this statutory approach has any application to the common law of estoppel. 6 The court may, in an appropriate case, but which must be comparatively rare, make a declaration that a foreign (in casu, Alberta) judgment will qualify for recognition, even though no challenge to its liability to recognition has been made: Phillips v Avena [2005] EWHC 3333 (Ch). 7 The material gateway rule will be CPR 6 PD 6B, para. 3.1(10). There is no question of the Brussels/ Lugano rules applying to the matter, as the enforcement of a judgment from a non-Member State is outside the scope of the Brussels/Lugano scheme: C-129/92 Owens Bank Pic v Bracco 1994] ECR 1-117.
• [2] See below, Chapter 35. 2 Tasarruf Mevduati Sigorta Fonu v Demirel [2007] EWCA Civ 799, [2007] 1 WLR 2508. This decision does not appear to have been cited to the court in Linsen International Ltd v Humpuss Transportasi Kimia [2011] EWCA Civ 1042, and the latter decision is not to be preferred. 3 Those previously examined. 4 From those further objections to be considered below. 5 CPR r. 24.4, and Practice Direction, para. 5. 6 Civil Jurisdiction and Judgments Act 1982, Section 34. 7 Cause of action estoppel. 8 Issue estoppel. 9 What is said here will apply with equal force to a defendant who makes a counterclaim: he is to all intents and purposes a claimant.