High Court provides guidance on registration requirements for enforcing European judgments in England

United KingdomScotland

In Percival v Moto Novu LLC [2019] EWHC 1391 (QB), the High Court considered the requirements for registering a foreign judgment for enforcement in England under the Brussels Regulation (EC 44/2001). The decision involved a detailed interpretation of the operation of the registration process and therefore provides helpful guidance to parties seeking to enforce judgments under the Regulation or its updated version, the Recast Brussels Regulation (EU/1215/2012).

Background

An aborted property transaction in Italy led to three related Italian judgments:

  • An order of the Milan Tribunal against Mr Percival and a corporate co-defendant for payment of a specified sum to the three claimants
  • A judgment of the Milan Court of Appeal reducing the damages awarded, but otherwise affirming the Milan Tribunal decision
  • A judgment of the Italian Supreme Court again affirming the earlier decisions

Before the Italian Supreme Court gave its judgment, one of the claimants assigned his interest in the judgments of both the Milan Tribunal and the Milan Court of Appeal to the respondent, Moto Novu. Meanwhile, Mr Percival became the sole judgment debtor following the dissolution of the corporate co-defendant.

Moto Novu applied to the High Court to register all three judgments, apparently because it took the view that the judgments could only be properly understood if read together. Master Cook granted the order and Mr Percival appealed on a number of grounds of alleged non-compliance with the Brussels Regulation.

Requirements of the registration process

As Murray J observed, the Brussels Regulation sets out a scheme intended to enable a party to enforce a judgment from a court in one EU member state in another EU member state relatively quickly and with a minimum of formality.

The first stage involves an ex parte application by an “interested party” for registration of the foreign judgment. Murray J noted that this stage was intended to be “no more than a check of the documents” with no consideration of any grounds for non-enforcement. Instead, the judgment was to be declared enforceable virtually automatically following completion of the formalities set out in the Regulation.

The second stage allows the respondent to raise certain limited objections by lodging an appeal within a specified period, as Mr Percival did in this case. The Brussels Regulation sets out a limited list of grounds upon which an appeal may be brought. However, Murray J concluded that this could not be read literally, as the drafters could not have intended to exclude questions of whether the judgment fell within the scope of the Brussels Regulation at all or whether there were other provisions of law precluding recognition. He found that, in fact, all grounds of opposition may be raised at this second stage, other than those relating to the merits of the judgment. Examples of further grounds of opposition might be that the judgment was not enforceable in the member state in which it was given or that the applicant was not an “interested party”.

Failure to file a certificate of enforceability was not fatal

One of Mr Percival’s grounds of appeal was that the registration application did not satisfy the requirements of the Brussels Regulation, as Moto Novu did not file a certificate of enforceability or equivalent document or provide information as to why this was not required.

Murray J concluded that Master Cook was entitled to form his own view as to the authenticity of the Italian judgments and as to whether he had sufficient information to justify dispensing with a requirement for a certificate.

Meaning of “interested party”

A further ground of appeal was that Moto Novu was unable to enforce the Italian judgments in full, as it had taken an assignment of one claimant’s interest only and was therefore only entitled to a one-third share of the judgments.

Murray J commented that he had not been shown any authority for the proposition that an applicant’s registration should be limited to the proportion to which he is entitled. The only requirement in the Brussels Regulation was for the applicant to be an “interested party”. This was not defined in the Brussels Regulation, but Murray J. considered that it would be “fundamentally incompatible” with the limited and mechanical nature of the registration process for the registering court to enquire into the nature and extent of an applicant’s interest, beyond what was necessary to establish that on the face of the matter, the applicant was an interested party.

Judgment

Murray J decided, based on expert evidence of Italian law, that only the Milan Court of Appeal judgment was enforceable. He therefore varied the order to limit the registration only to that judgment. He also commented that, had the Master recorded brief reasons for his decision to dispense with the requirement for a certificate of enforceability as part of the first stage of the registration process, this would have helped to limit the issues arising at the second stage of the process. Questions arose as to the effectiveness of the assignment to Moto Novu, but Murray J. noted that these were to be dealt with at the time of enforcement, not at the registration stage.

Comment

The decision provides some helpful clarity on the English courts’ interpretation of the requirements of the Brussels Regulation, including its willingness to consider additional grounds of appeal beyond those expressly listed in the Regulation itself. This provides parties seeking to oppose the enforcement of a judgment with a wider range of potential procedural arguments, though the court did emphasise that there could be no opposition to the merits of the judgment itself. The case highlights that the first stage of the registration process is to be viewed as a simple document check only, and therefore it is the second stage where the opposing party will have the opportunity to present any such grounds of opposition.

The Brussels Regulation was repealed on 10 January 2015 and replaced with the Recast Regulation, which removes the requirement for a certificate of enforceability. The other aspects of this decision are likely to apply to registration proceedings under the Recast Regulation as well as under the Brussels Regulation.

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