Last week I received a call from the general counsel of a corporation looking to enforce a foreign judgment here in the U.S. I explained that the process is straightforward, assuming the foreign judgment does not conflict with certain principles, which I’ll explain below.
The same also generally holds true for the enforcement of U.S. judgments in a foreign country. While the process is straight forward, the individual laws of each country will govern the enforceability of the U.S. judgment.
Enforcement of Foreign Judgment in the U.S.
In the U.S., recognition and enforcement of foreign judgments is usually a matter of state law. More than half of the states have adopted some version of the Uniform foreign Money-Judgments Recognition Act (“UFMJRA”). Other states generally apply factors that are similar to those set out in the UFMJRA. Under the UFMJRA, recognition of a foreign judment will be denied if:
- The judgment was rendered under a system that does not provide impartial tribunals or procedures compatible with the requirement of due process of law;
- The foreign court did not have personal jurisdiction over the defendant; or
- The foreign court did not have subject matter jurisdiction.
Enforcement of a foreign judgment is generally accomplished by filing a new lawsuit based on the original foreign judgment and obtaining a U.S. judgment that can then be enforced in the same way as any other judgment.
Recognition of U.S. Judgment in Foreign Country
The recognition of a U.S. judgment in a foreign country will be determined by the domestic laws of the foreign country. As a general rule, a U.S. judgment will only be enforced if there is a showing that the debtor received proper notice of the proceeding and the court that rendered the judgment possessed jurisdiction over both the debtor and the subject matter of the dispute.
An additional requirement that is often included as a condition of recognition and enforcement of a judgment is that the country where the judgment was rendered also grants reciprocity to the foreign couintry by recognizing its judgments.