Facts
Decision
Comment
The Isle of Man High Court has again looked at the question of a party's voluntary submission to the jurisdiction of a court in assessing whether an action based on a Nigerian judgment can properly proceed in the Isle of Man Court.
Facts
In Petrodel v Le Breton the court heard argument on the claimant's application for permission to serve the claim form out of the jurisdiction on the defendant, Mr Le Breton, who is a resident of Monaco.(1) The claimant had earlier obtained a judgment in Nigeria against Le Breton in the sum of £340,944 and sought to enforce that judgment by a new action commenced in the Isle of Man High Court. Pursuant to the Rules of the High Court of Justice 2009, an application was made seeking permission to serve the claim form out of the jurisdiction and Rules 2.41 and 2.42 were considered by the court.
In light of other litigation between the same parties, the hearing seeking permission to serve the claim form out of the jurisdiction unusually involved both parties, instead of the application being heard either administratively or on an ex parte basis. The court heard how the extenuating circumstances in this case were that Le Breton had obtained judgment against Petrodel in England in April 2011, and that the English judgment had been registered in the Manx court with execution granted. An application to stay that execution had been received.
Whereas certain English judgments can be registered in the Isle of Man under statutory reciprocal arrangements, judgments from many other countries cannot be so registered; the method of enforcement in the Isle of Man would be to use the foreign judgment as a cause of action in a new proceeding brought before the Isle of Man High Court. This is what the claimant, Petrodel, was attempting to do. However, the court asked itself two primary questions when considering whether the permission should be granted to allow the claim form to be served on Le Breton.
Decision
First, the court asked itself whether the Isle of Man was the proper place to bring the claim. The court heard that there was benefit to Petrodel in seeking a judgment in the Isle of Man based on the Nigerian judgment because Le Breton might at some point have assets within the jurisdiction. In any event Petrodel could seek to offset the judgment of Le Breton against its own claim. The court was therefore satisfied that there was a good arguable case that the matter fell within Rule 2.41(1)(j) – that is, the claim form was a claim made to enforce a judgment or arbitral award.
The court then asked whether the court should properly enforce this Nigerian judgment and therefore had to look at the facts of the Nigerian proceedings as they appeared to the court. The court was referred to Rule 36 of Dicey and Morris (as approved by the Isle of Man Appeal Court decision in Deras v Ocean Marine Mutual Insurance Association Ltd [1996-98] MLR 517), according to which the court has jurisdiction to give a judgment in personam capable of enforcement or recognition in four possible situations. The relevant scenario in the case before the court was that the judgment debtor was a defendant in a foreign court who had submitted to the jurisdiction of that court by voluntarily appearing in the proceedings.
The court heard that Le Breton's participation in the Nigerian proceedings had been restricted to requesting certain documents and having a lawyer keep a watching brief. Le Breton did not appear by counsel or in person at the Nigerian proceedings. He did not enter an appearance.
On that basis, the Manx court was satisfied that what Le Breton did or did not do in Nigeria could not amount to a submission by way of a voluntary appearance in accordance with Deras. The court approved the following passage from Astro Exito Navegacion SA (The Messiniaki Tolmi) [1984] 1 Lloyd's Rep 266:
"Now a person voluntarily submits to the jurisdiction of the court if he voluntarily recognises or has voluntarily recognised that the court has jurisdiction to hear and determine the claim which is the subject matter of the relevant proceedings. In particular he makes a voluntary submission to the jurisdiction if he takes a step in proceedings which in all the circumstances amounts to a recognition of the court's jurisdiction in respect of the claim which is the subject matter of those proceedings. The effect of a party's submission to the jurisdiction is that he is precluded thereafter from objecting to the court exercising its jurisdiction in respect of such claim."
The court found that, even taking the claimant's case at its highest, the defendant's conduct could not amount to a submission by way of voluntary appearance. The court pointed out that the Manx rules of private international law that apply when assessing whether there has been a submission. The court found that the Nigerian court did not have in personam jurisdiction over Le Breton because he:
- was not present in person;
- was not a claimant or counterclaimant;
- had not submitted to the jurisdiction by voluntary appearance; and
- had not agreed to submit to the jurisdiction.
The Nigerian judgment was therefore declared incapable of enforcement and recognition in the Isle of Man and the application for permission to serve out of the jurisdiction was dismissed.
Comment
This first instance decision of the Isle of Man High Court is a useful reminder as to the private international law position on enforcing foreign judgments at common law in other territories. It is clear that the court in the Isle of Man will scrutinise closely whether, in the circumstances, one of the four grounds set out in Dicey Rule 36 has been satisfied. The court noted that the dividing line between what is and what is not a voluntary submission and what is and what is not an appearance solely to protest against jurisdiction is narrow and often difficult to draw satisfactorily. Each case will depend on its facts as to whether acts or omissions constitute a voluntary submission or any of the other categories in Rule 36.
The countries with which the Isle of Man has statutory reciprocal arrangements for registration of judgments are the United Kingdom, Guernsey, Jersey, Israel, Italy, Suriname and the Netherlands. In cases involving judgments from other territories, the common law enforcement of foreign judgments will be the normal way to proceed, subject to satisfying the court that service on a party outside the Isle of Man should properly proceed.
For further information on this topic please contact John T Aycock at M&P Legal by telephone (+44 1624 695800), fax (+44 1624 695801) or email ([email protected]).