I. Introduction
The choice offered on this submit was rendered within the context of a case beforehand reported right here. All the feedback I made there, notably concerning the potential for imposing a overseas enforcement judgment and different associated points, stay notably related. Nevertheless, as I’ve discovered extra in regards to the procedural historical past previous the selections of the Dubai Supreme Courtroom (“DSC”), which was not out there to me once I posted my earlier remark, larger emphasis shall be positioned on the final factual background of the case. The choice offered right here raises plenty of basic questions associated to the correct understanding of overseas authorized ideas and procedures and the way they need to be built-in throughout the framework of home legislation. Subsequently, it deserves particular consideration.
I wish to thank Ed Morgan (Toronto, ON Canada) who, on the time when my earlier remark was posted, delivered to my consideration the textual content of the Ontario judgment whose enforcement was sought in Dubai within the current case.
II. Information:
1. Background (based mostly on the define supplied by the DSC’s selections)
X (appellant) obtained a judgment in america in opposition to Y (appellee), which then sought to implement it in Canada (Ontario) through a movement for abstract judgment. After the Ontario courtroom ordered enforcement of the American judgment, X sought enforcement of the Canadian judgment in Dubai by submitting an software with the Execution Courtroom of the Dubai Courtroom of First Occasion.
2. First Enchantment: DSC, Enchantment No. 1556 of 16 January 2024
The decrease courts in Dubai admitted the enforceability of the Canadian judgment. Unhappy, Y appealed to the DSC. The DSC admitted the attraction and overturned the appealed determination, remanding the case for additional overview.
Based on the DSC, the arguments raised by Y to withstand the enforcement of the Canadian judgment – i.e. that the Courtroom of Enchantment erred in not addressing his argument that the overseas judgment was a “abstract judgment [hukm musta’jil][i] declaring enforceable a rehabilitation order (hukm rad i’tibar)[ii] and an obligation to pay a sum of cash rendered in america of America that can’t be enforced within the nation [Dubai]” – was a sound argument that, if true, would possibly change the end result of the case.
3. Second Enchantment: DSC, Enchantment No. 392/2024 of 4 June 2024
The case was despatched again earlier than the courtroom of remand, which, in gentle of the choice of the DSC, determined to overturn the order declaring enforceable the Ontario judgment. Subsequently, X appealed to the DSC.
Earlier than the DSC, X challenged the remand courtroom’s determination arguing that (i) the principles governing the enforcement of overseas judgments don’t differentiate by sorts or nature of overseas judgments; (ii) that beneath Canadian legislation, “abstract judgment” means a “substantive judgment on the deserves”; and that (iii) Y actively participated within the proceedings and the shortage of a full trial didn’t violate Y’s rights of protection.
III. The Ruling
The DSC admitted the attraction and confirmed the order declaring enforceable the Canadian judgment.
After stating the final rules governing the enforcement of overseas judgments within the UAE and recalling some basic rules of authorized interpretation (such because the prohibition of non-public interpretation within the presence of a completely unambiguous textual content, and the precept that authorized provisions expressed in broad phrases shouldn’t be interpreted restrictively), the DSC dominated as follows (all quotations contained in the textual content beneath are added by the writer):
“[it appears from the wording of the applicable legal provision[iii] that] exequatur decrees will not be restricted to “judgments” (ahkam) rendered in overseas international locations however extends to overseas “orders” (awamir) supplied that they meet the necessities for his or her enforcement. Moreover, the [applicable legal provision][iv] has been put in broad phrases (‘aman wa mutlaqan), encompassing all “judgments” (ahkam) and “orders” (awamir) rendered abroad with out specifying their kind (naw’) or nature (wasf) so long as the opposite necessities for his or her enforcement are glad. Furthermore, there isn’t a proof that every other authorized textual content pertaining to the identical topic specifies limitations on the aforementioned [the applicable legal provision]. On the contrary, and in contrast to the state of affairs [under the previously applicable rules],[v] the Legislator has expanded the idea of enforceable titles (al-sanadat al-tanfidhiyya),[vi] which now contains felony judgments involving restitution (radd), compensations (ta’widhat), fines (gharamat) and different civil rights (huquq madaniyyah). […]
Given this, and contemplating that the appealed determination overturned the exequatur decree of the judgment in query on the bottom that the [Canadian] judgment, which acknowledged a judgment from america, was a “abstract judgment” (hukm musta’jil) enforceable solely within the rendering State, regardless of the broad wording of [the applicable provisions],[vii] which covers all judgments (kul al-ahkam) rendered in a overseas State with out specifying their kind (naw’) or nature (wasf) supplied that the opposite necessities are met. Within the absence of every other specification by every other authorized textual content pertaining to the identical topic, the interpretation made by the appealed determination restricts the generality of [the applicable rules] and limits its scope [thereby] introducing a special rule not stipulated therein.
Furthermore, the appealed determination didn’t make clear the idea for its conclusion that the [foreign] judgment was a “abstract judgment” (hukm musta’jil) enforceable solely within the rendering State. [This is more so], particularly because the submitted paperwork on the Canadian civil process legislation and the Regulation No. 194 on [the Rules of Civil Procedure] present that Canadian legislation acknowledges the system of “Abstract judgment”[viii] for issuing judgments by way of expedited procedures, and that the [foreign] judgment was certainly rendered following expedited procedures after Y’s participation by submitting rebuttal memoranda and listening to of the witnesses.[…]
Contemplating the foregoing, and upon reviewing the [Canadian] judgment… rendered in favor of the appellant as formally authenticated, it’s established that the events (X and Y) appeared earlier than the [Canadian] courtroom, [where] Y offered his arguments … and the witnesses had been heard. Based mostly on these proceedings [before the Canadian court], the courtroom determined to difficulty the aforementioned “abstract judgment” (al-hukm al-musta’jil) whose enforcement is sought in [this] nation. [In addition, the appellant presented] an formally authenticated certificates testifying the authorized authority (hujjiyat) [and the finality][ix] of the [Canadian] judgment. Subsequently, the necessities stipulated [in the applicable provisions][x] for its enforcement have been glad. As well as, it has not been established that the courts [of the UAE] have unique jurisdiction over the dispute topic of the overseas judgment, nor that the [foreign] judgment is [rendered] in violation of the legislation of the State of origin or the general public coverage [in the UAE], or that it’s inconsistent with a judgment issued by the UAE courts. Subsequently, the [Canadian] judgment is legitimate as a an “enforceable title” (sanad tanfidhi) based mostly on which execution may be pursued.
IV Feedback
The choice offered right here has each constructive and destructive elements. On the constructive aspect, the DSC gives a welcome clarification concerning the that means of “overseas judgment” for the needs of recognition and enforcement. On this respect, the DSC aligns itself with the final precept that “overseas judgments” are entitled to enforcement no matter their designation, so long as they qualify as a “substantive judgment on the deserves”. This precept has quite a few express endorsements in worldwide conventions coping with the popularity and enforcement of overseas judgments[xi] and is widely known in nationwide legal guidelines and practices.[xii]
Nevertheless, the DSC’s understanding of the Canadian proceedings and the character of the abstract judgment granted by the Canadian courtroom, in addition to its try and align widespread legislation ideas with these of UAE legislation are quite questionable. On this respect, the DSC’s determination exhibits a level of outstanding confusion within the utilizing the suitable authorized terminology and understanding basic authorized ideas. These embrace (i) the remedy of overseas abstract enforcement judgments as peculiar “enforceable titles” (sanadat tanfidhiyya – titres exécutoires) beneath home legislation together with home judgments rendered in felony issues; (ii) the assimilation between abstract judgment in widespread legislation jurisdictions and hukm musta’jil (“abstract interlocutory proceedings order” – “jugement en référé”); and (iii) the confusion between abstract judgment based mostly on substantive authorized points and abstract judgment to implement overseas judgments.
For the sake of brevity, solely the third level shall be addressed right here for its related significance. Nevertheless, earlier than doing so, some gentle ought to be shed on the proceedings earlier than the Canadian courtroom.
1. The proceedings earlier than the Canadian Courtroom and the character of the Canadian Judgment
The unfamiliarity with DSC with the proceedings in Canada and underlying details is quite stunning for 2 causes: i) the proceedings had been initiated by the American authorities within the context of a bilateral cooperation in felony issues; and ii) the Canadian proceedings was a continuing to implement a overseas judgment rendered in felony issues and was not merely a continuing coping with substantive authorized points. Subsequently, an in depth overview of the proceedings earlier than the Ontario is important to raised perceive the peculiarities of the case commented right here.
i) Proceedings within the context of mutual cooperation in felony issues. The case originated in Ontario-Canada as a movement introduced by america of America represented by the Division of Justice as plaintiff for abstract judgment to acknowledge and implement a “Restitution Order”[xiii] made in opposition to Y (defendant). The Restitution Order was a part of Y’s sentence within the USA for securities fraud and cash laundering. It “included phrases as to fee and listed the victims and quantities to which they had been entitled beneath the order” [para. 16].
The overall procedural context of the Canadian judgment is of utmost relevance. Certainly, the USA sought the enforcement of the Restitution Order on the idea of the Mutual Authorized Help in Legal Issues Act. The Act, because it describes itself, goals “to supply for the implementation of treaties for mutual authorized help in felony issues”. Based on the Ontario Courtroom, The Act is a “Canadian home laws enacted to fulfill Canada’s treaty obligations for reciprocal enforcement in felony issues” [para. 6]. These treaty obligations are based mostly on the Canada-USA Treaty on Mutual Authorized Help in Legal Issues of 1990 [para. 6].
For this reason, earlier than the Canadian Courtroom, one of many principal questions [para. 25] was whether or not the “Restitution Order” could possibly be considered “fantastic” throughout the that means of the Act [para. 26]. If that is so, then the Restitution Order could possibly be enforced as a “pecuniary penalty decided by a courtroom of felony jurisdiction” within the that means of article 9 of the Act.
On the idea of a “broad, purposive interpretation of “fantastic” … aligned with Canada’s” worldwide obligation beneath the Treaty, the Ontario courtroom thought-about that “proceeds of crimes, restitution to the victims of crime and the gathering of fines imposed as a sentence in a felony prosecution” may be considered “fantastic” for the aim of the case [para. 30]. As well as, the courtroom characterised the restitution order as “a pecuniary penalty decided by a courtroom of felony jurisdiction” [para. 35], and in addition described it as an “order made to repay the person members of the general public who had been inspired to buy inventory at an inflated value by advantage the felony exercise” [para. 39]. The courtroom in the end, concluded that “the Restitution Order made in opposition to [Y] is a “fantastic” throughout the that means of… the Act” [para. 41].
From a conflicts of legal guidelines perspective, the query of whether or not the “Restitution Order” is of a penal nature is essential. Certainly, it’s usually accepted that penal judgments will not be eligible to recognition and enforcement. Nevertheless, nothing prevents derogating from this precept by concluding worldwide conventions or imposing the civil legislation element of overseas judgments rendered by felony courts in felony proceedings, which orders the fee of civil compensation.[xiv]
Curiously, earlier than the Canadian courtroom, Y argued that the “Restitution Order” made in opposition to him was not a “fantastic” as a result of it was a “compensatory-type” order [para. 27]. Nevertheless, it’s clear that it was an try and exclude the enforcement of Restitution Order from the scope of software of the Mutual Authorized Help in Legal Issues Act. In any occasion, regardless of the essential theoretical and sensible significance of the problem, this isn’t the place to debate whether or not the “Restitution Order” was penal or civil in nature. What issues right here is the character of the continuing introduced earlier than the Canadian courtroom which is a abstract continuing to acknowledge and implement a overseas judgment. This leads us to the following level.
ii) Nature of the Canadian judgment. It’s clear from the very starting of the case that the USA didn’t carry an motion on the deserves however sought “an order for abstract judgment recognizing and imposing a judgment a Restitution Order made in opposition to [Y] as a part of his sentence in [the USA] for securities fraud and cash laundering” [para. 1]. Subsequently, the case was a few movement for a abstract judgment to implement a overseas judgment. On this respect, one of many fascinating elements of the case is that Y additionally relied on the enforcement of overseas judgments framework and raised, inter alia, “a defence of public coverage” at widespread legislation [para. 79] citing Beals v, Saldanha (2003), a number one Canadian Supreme Courtroom judgment on the popularity and enforcement of overseas judgments in civil and industrial issues.[xv] The courtroom nonetheless dismissed the argument contemplating that there was “no real difficulty for trial on the query of a public coverage defence in opposition to the enforcement in Canada of the Restitution Order” [para. 82].
Accordingly, if one places apart the query of enforceability of overseas penal judgments, it’s clear that the Canadian judgment was a judgment declaring enforceable a overseas judgment. The very conclusion of the Canadian courtroom makes it even clearer when the courtroom granted USA’s movement for abstract judgment by ordering the enforcement in Canada of the Restitution Order [para. 84]. Accordingly, as mentioned in my earlier touch upon this case, and making an allowance for the character of the Canadian judgment, it may be safely mentioned that the Canadian enforcement judgment can’t be eligible to recognition and enforcement elsewhere based mostly on the adage “exequatur sur exequatur ne vaut”.
2. No… a abstract judgment to implement a overseas judgment is just not a abstract judgment based mostly on substantive authorized points!
It’s extensively identified that the procedural elements of the enforcement of overseas judgments largely differ throughout the globe. Nevertheless, it’s truthful to say that there are, no less than, two principal fashions (though different enforcement modalities do additionally exist). Usually talking, civil legislation jurisdictions undertake the so-called “exequatur” continuing the primary objective of which is to confer executory energy to the overseas judgment and transforms it into an area “enforceable title”. However, in widespread legislation jurisdictions, and within the absence of relevant particular regimes, the enforcement of overseas judgments is carried out by initiating a brand new and unique motion introduced earlier than native courtroom on the overseas judgment.[xvi] The aim of this motion is to acquire an enforceable native judgment that, whereas recognizing and imposing the overseas judgment, is rendered as if it had been a judgment initially issued by the native courtroom.[xvii] Each procedures lead to related end result:[xviii] what has been determined by the overseas courtroom shall be granted impact within the kind. Nevertheless, technically, in civil legislation jurisdiction it’s the overseas judgment itself that’s permitted to be enforced within the discussion board,[xix] whereas in widespread legislation jurisdictions, it’s the native judgement alone which is enforceable within the discussion board.[xx]
Such an enforcement in widespread legislation jurisdictions is normally carried out by means of abstract judgment process.[xxi] Nevertheless, this process shouldn’t be confused with the usual abstract judgment process used to resolve disputes on the deserves inside an ongoing case. The truth is, it’s a distinct course of aimed particularly at recognizing and imposing overseas judgments,[xxii] which is the functionally equal counterpart in widespread legislation jurisdictions to the exequatur process.
That is exactly the confusion that the DSC encountered. The Courtroom regarded the Canadian abstract judgment as “a civil substantive judgment on the deserves”, though it was not. Subsequently, – and as already defined – the abstract judgment rendered in results of this continuing can’t be considered “overseas judgment” eligible for recognition and enforcement overseas in software of the precept “exequatur sur exequatur ne vaut”.
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[i] In my earlier submit, I translated the time period “hukm musta’jil” as “abstract judgment to spotlight the character of the Canadian process. Nevertheless, from the aim of UAE legislation, I feel it’s higher that this phrase be translated as “abstract interlocutory judgment – jugement en référé”. This being mentioned, for the aim of this submit the phrases “abstract judgment” shall be used to spotlight the terminological confusion dedicated by the DSC.
[ii] In my earlier submit, I used to be misled by the inappropriate terminology used within the DSC’s determination which referred to this American order as “Rehabilitation order” (hukm rad i’tibar). The time period “rehabilitation order” is maintained right here as that is the time period utilized by the DSC.
[iii] The DSC made reference to article 85 of Cupboard Decision No. 57/2018 on the Govt Rules of Legislation No. 11/1992 on Civil Process Act (hereafter “2018 Govt Regulation”), which was subsequently changed by article 222 of New Federal Act on Civil Process (Legislative Decree No. 42/2022 of three October 2022) (hereafter “New 2022 FACP”).
[iv] Ibid.
[v] The DSC referred the previous Federal Act on Civil Process of 1992 (Federal Act No. 11/1992 of 24 February 1992)
[vi] The DSC referred to article 75(2) of the 2018 Govt Regulation as subsequently supplanted by article 212(2) of the New 2022 FACP.
[vii] Supra n (3).
[viii] Within the unique. Italic added.
[ix] Within the phrases of the DSC, the overseas judgment “was not topic to attraction”.
[x] Supra n (3).
[xi] See Article 3(1)(b) of the HCCH 2019 Judgments Conference; article 4(1) of the HCCH 2005 Selection of Courtroom Conference; article 25(a) of the 1983 Riyadh Conference.
[xii] See eg. the Japanese Supreme Courtroom Judgment of 28 April 1998 defining overseas judgment as “a remaining judgment rendered by a overseas courtroom on personal legislation relations… whatever the title, process, or type of judgment” “[e]ven if the judgment is named a call or order”.
[xiii] Supra n (2).
[xiv] On UAE legislation on this difficulty, see my earlier submit right here and the authorities cited therein.
[xv] On this case see, Janet Walker, “Beals v. Saldanha: Hanging the Comity Stability Anew” 5 Canadian Worldwide Lawyer (2002) 28; idem, “The Nice Canadian Comity Experiment Continues” 120 LQR (2004) 365; Stephen G.A. Pitel, “Enforcement of International Judgments: The place Morguard Stand After Beals” 40 Canadian Enterprise Legislation Journal (2004) 189.
[xvi] Trevor C. Hartley, Worldwide Business Litigation (third ed. 2020) 435.
[xvii] Adrian Briggs, “Recognition of International Judgments: A Matter of Obligation” 129 LQR (2013) 89.
[xviii] Briggs, ibid.
[xix] Peter Hay, Advance Introduction to Personal Worldwide Legislation and Process (2018) 110.
[xx] Briggs, supra n (17).
[xxi] Adeline Chong, Asian Rules for the Recognition and Enforcement of International Judgments (2021)13.
[xxii] Cf. Hartley, supra n (16) 435 stating that “Procedurally, due to this fact, a brand new motion is introduced; in substance, nonetheless, the overseas judgment in acknowledged and enforced” (italic within the unique).