There are two ways successful UK litigants can have their judgments recognised in Australia
Enforcing judgments abroad can be a complex and costly exercise. Fortunately, successful UK litigants can generally have their judgments recognised in Australia without having to relitigate their case. Once a UK judgment has been recognised the judgment creditor can avail itself of the full gamut of enforcement procedures available under Australian law to recover the money owed to it. In this article we discuss the two primary methods of having UK judgments recognised in Australia: registration under the Foreign Judgments Act 1991 (Cth) (Act) and recognition at common law.
Registration under the Foreign Judgments Act
Australia and the United Kingdom have a reciprocal arrangement for the enforcement of judgments. Consequently, money judgments of most UK courts, which satisfy certain criteria, may be enforced in Australia by registration under the Act.
A "money judgment" is any judgment which requires the payment of money including orders for damages and costs. UK courts, like their counterparts in Australia, are not confined to issuing money judgments and there is a variety of other types of judgments or orders they can issue, however these are not money judgments. For example, an injunction which is a common order issued on a interlocutory or final basis and which restrains someone from doing something, is not a money judgment. These other types of judgment can, in certain limited circumstances, be enforced in Australia but this requires judicial process outside the operation of the Act.
Registering a judgment under the Act is a straightforward and cost-effective procedure. Once registered, the UK judgment has the status of a judgment delivered by an Australian superior court.
Which judgments can be registered?
The Act applies to money judgments that are obtained either on a final or interlocutory basis. To be registrable under the Act the money judgment must have been obtained in the last six years and satisfy the following five criteria.
Be an enforceable money judgment: Any judgment for the payment of money will be an enforceable money judgment, except judgments concerning tax liabilities or similar charges or a fine or penalty.
Be final and conclusive: A judgment will be treated as final and conclusive even though it may still be subject to appeal in the UK. Default judgments are also considered to be final and conclusive unless steps are taken to set them aside.
Not be wholly satisfied: A judgment cannot be registered if at the date of the application it has been wholly satisfied. Partially satisfied judgments can still be registered for the amount which remains unpaid.
Capable of being enforced in the UK: A UK judgment can only be registered in Australia if it is capable of being enforced in the UK. It is therefore critical to ensure that all necessary steps are taken to render the judgment enforceable in the UK before a registration application is lodged in Australia.
Not be liable to be set aside if registered under the Act: In registration applications it is necessary to adduce evidence that the UK judgment would not be liable to be set aside if registered. The Act prescribes various circumstances in which a judgment will be liable to be set aside. Chief amongst these is if the UK court is shown not to have exercised jurisdiction in the international sense. Under the Act, a UK court will be deemed to have had the relevant jurisdiction if:
- the defendant voluntarily submitted to the court's jurisdiction;
- at the time when the UK proceedings were instituted the defendant resided in or had its principal place of business in the UK; or
- the UK proceedings concerned a transaction effected through or at an office or place of business that the defendant had in the UK.
The UK judgment will not be registrable under the Act if jurisdiction cannot be established on one of these grounds. However, the judgment may still be enforceable at common law (see below).
Provided that the five requirements set out above are satisfied, the Australian court must register the UK judgment.
Procedure for registering judgments under the Act
Registration applications are typically made on an ex parte basis and involve the preparation and lodgement of a suite of documents. Generally, the application will be dealt with in chambers by the Registrar. Once the judgment has been registered, the plaintiff must serve a Notice of Registration on the defendant. The defendant then has 14 days in which to file any application to set aside the registered judgment. Broadly, a judgment will be set aside if the defendant can show that it did not satisfy each of the five criteria discussed above.
If no application to set aside the judgment is made within the prescribed time then the plaintiff can proceed immediately to enforce the judgment against the defendant's assets.
Staying enforcement of a registered judgment
If the defendant appeals the UK judgment in the original court or indicates that he or she intends to do so, the Australian court may order that the enforcement of the registered judgment be stayed pending final determination of the appeal. Any stay on enforcement of a registered judgment must be made on the condition that the defendant lodge the appeal by a specified day and that the appeal be pursued expeditiously.
Recognition of UK judgments at common law
If for some reason a UK judgment cannot be registered under the Act it may still be possible to have it recognised and enforced at common law. A final and conclusive money judgment will be enforceable at common law provided the Australian court is satisfied that the UK court exercised jurisdiction in the international sense.
The common law test for jurisdiction in the international sense is somewhat broader than the test prescribed under the Act. At common law a UK court will be deemed to have exercised the relevant jurisdiction if:
- the defendant voluntarily submitted to the UK court's jurisdiction; or
- the defendant was ordinarily resident in the UK or present in the UK at the time that he or she was served with the originating process.
While these are the two most common grounds for establishing jurisdiction in the international sense, there is an emerging line of authority which says international jurisdiction will be recognised where the defendant was a citizen of the country of the foreign court and the defendant actively used his or her citizenship. Evidence of active citizenship includes that the defendant travels on his or her foreign passport, actively relied on rights afforded to him or her by virtue of his or her citizenship, or maintained his or her right to vote in the country of the foreign court.
Provided that the above conditions can be satisfied then the UK judgment will prima facie be entitled to recognition at common law. Generally, the defendant is prohibited from raising any defence to enforcement of the judgment unless it can be shown that:
- the judgment was obtained by fraud;
- the foreign court acted contrary to natural justice; or
- the foreign judgment is contrary to Australian public policy.
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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.