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Home General Practice

The legality of foreign judgments in domestic cases in the USA

by Harsh Upadhyay
October 18, 2021
in General Practice
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The legality of foreign judgments in domestic cases in the USA
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Introduction:

The United States is not a signatory to any convention or treaty that governs the recognition or enforcement of non-US court judgments in US courts. While this chapter does not specifically address international arbitration awards; it is worth noting that the US is a party to multilateral conventions that bear on US court enforcement of arbitration awards. The UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention); and the Inter-American Convention on International Commercial Arbitration 1979 (Panama Convention). Typically, foreign arbitration awards issued pursuant to the New York and Panama Conventions face an easier path to recognition and enforcement in US courts than foreign judgments, because of these Conventions.

The US is also a party to the multilateral Convention on the Settlement of Investment Disputes. Between States and Nationals of Other States 1965 (ICSID Convention). Awards falling under the ICSID Convention, treated signatory states as though they enforce domestic court awards.

Intra-state variations

Is there uniformity in the law on the enforcement of foreign judgments among different jurisdictions within the country?

Recognition and enforcement of foreign judgments in the United States are typically addressed on a state-by-state basis. Although the law in almost all of the states can be traced back to the principles set forth in the US Supreme Court case Hilton v Guyot, 159 US 113 (1895).

Despite sharing origins in the Hilton case, state law approaches to the recognition and enforcement of foreign judgments display some significant differences. Including the way, they address reciprocity with the foreign jurisdiction as a prerequisite to recognition and enforcement. And the way they analyze the discretionary grounds for non-recognition of a foreign judgment.

Must case-seeking enforcement of foreign judgments be brought in a particular court?

Most US states require the party seeking recognition and enforcement of a foreign judgment to file an action in a court; that has an adequate basis to exercise jurisdiction over the alleged judgment creditor. Recognition and enforcement actions are brought in a state court or a federal court, depending on procedural rules. However, a federal court sitting in diversity will generally apply the substantive law of the state in which it sits; Consequently, based on principles emerging from Erie RR Co v Tompkins, 304 US 64 (1938). Federal common law principles apply in specialized cases.

A party may seek, in a federal court, to recognize and enforce under the Federal Arbitration Act. International arbitral award obtained under the New York or Panama Conventions.[1]

judgments

A last, decisive and enforceable judgment, regularly needed to be a common judgment for a decent amount of cash; is the beginning stage for acknowledgment by a US court (eg, segment 3(a)(2) of the 2005 Model Act and area 3 of the 1962 Model Act). Not at all like in certain nations, this ‘absolution’ prerequisite does not generally decipher in US courts. To imply that the unfamiliar judgment is presently not exposed to any requests in the unfamiliar locale. Be that as it may, in numerous US state courts, an unfamiliar judgment is as yet liable to claim in the responsible gathering. Therefore, a connected US acknowledgment activity will probably remain the forthcoming goal of the allure in the unfamiliar discussion.

See PJSC Credit-Moscow Bank v Khairoulline, No. CV 15-6604, 2016 WL 4454208 (ED Pa 24 August 2016), tracking down that, under Pennsylvania’s acknowledgment resolution. The court had the purview of more than five Russian decisions. Despite the fact that each of the five decisions had been pursued in Russia, at the end of the day giving an optional stay, as allowed under Pennsylvania’s acknowledgment rule, forthcoming the result of the Russian investigative procedures.

Average compulsory justification for non-acknowledgment

  • In states that follow the 1962 and 2005 Model Acts; obligatory non-acknowledgment of an unfamiliar judgment is by and large required where:
  • the judgment delivered under a legal framework that doesn’t give unbiased councils;
  • the judgment delivered under a legal framework that doesn’t give methodology viable the prerequisites of fair treatment of law;
  • the unfamiliar court didn’t have individual ward over the litigant; or
  • the unfamiliar court didn’t have a ward over the topic.

For additional data, see area 4(a) of the 1962 Model Act and segment 4(b) of the 2005 Model Act.

Conclusion:

Previously, the propensity has been for judgment lenders to feel sure that the US acknowledgment interaction would include just a restricted survey of the unfamiliar judgment, however as clarified in this section, that isn’t really the case anymore. While US courts will surely keep away from an assessment of the hidden benefits of the unfamiliar judgment at issue, US courts will take part in a complete examination of the compulsory and optional non-acknowledgment factors. In this way, for instance, judgment lenders that bring to US courts speculate unfamiliar decisions that need indicia of decency or fair treatment ought not to assume that those decisions will be elastic stepped (see Osorio v Dole Food Co, 665 F Supp 2d 1307 (SD Fla 2009)).[2]


[1] https://www.lexology.com/library/detail.aspx?g=5d5742de-1eac-49bf-9e38-d8f0196eeef6

[2] https://www.gibsondunn.com/wp-content/uploads/documents/publications/Edelman-Jura-Enforcement-of-Foreign-Judgments-US.pdf

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