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      Proskauer on International Litigation and Arbitration:
       Managing, Resolving, and Avoiding Cross-Border Business or Regulatory Disputes
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  1. In 1962, the National Conference of Commissioners on Uniform State Laws approved and recommended for enactment the Uniform Foreign Money-Judgments Recognition Act (“UFMJRA” or the “Act”). See 13 U.L.A. 39 (1986). At the time, it was common for judgments rendered in U.S. courts not to be recognized abroad because of the concern held by other nations that judgments by their courts would not be recognized in a U.S. court. The Act codified the common law applied in the majority of U.S. states. The expectation was that, by adopting a “standard,” U.S. judgments would more likely be recognized abroad. See also Chapter 6 of this Guide, which also discusses the UFMJRA.
  2. Many states in the U.S., including New York, have adopted the Act or some parts of it. Currently, more than half the states have adopted some version of the Act.
    1. The New York statute can be found in Article 53 of the New York Civil Practice Law and Rules.
    2. The UFMJRA was revised and updated in 2005 to clarify provisions and correct problems created by the interpretation of provisions by courts over the years. Since its revision, the 2005 Act has been adopted by Idaho and Nevada, and has been introduced for adoption in California and Michigan. See http://www.nccusl.org/Update/.
  3. The UFMJRA applies to non-U.S. court judgments granting or denying the recovery of a sum of money.
    1. While the Act does not extend recognition to judgments for taxes, fines or penalties and support judgments in matrimonial and family matters, it does not prevent recognition by comity in matters not covered by the Act.
    2. The Act contains a savings clause, making clear that the Act is not intended to limit recognition of non-U.S. court judgments to those judgments described in the Act. See, e.g., Cal. Code Civ. Proc. § 1713.7 (“This chapter does not prevent the recognition or non-recognition of a foreign judgment in situations not covered by this chapter.”); Tex. Civ. Pract. & Rem § 36.008 (“This chapter does not prevent the recognition of a foreign country judgment in a situation not covered by this chapter.”) Thus, the Act impliedly recognizes that foreign judgments other than judgments for money may be recognized.
  4. The UFMJRA is modeled on the general common law requirements followed in Hilton v. Guyot with some minor variations.
  5. Under the UFMJRA, a non-U.S. court judgment will be recognized provided that it is final, conclusive and enforceable where rendered.
    1. The element of finality is achieved even though an appeal is pending or the judgment is subject to appeal. A non-U.S. court judgment is deemed conclusive to the extent that it grants or denies recovery of a sum of money.
  6. Mandatory grounds for non-recognition of judgments: A non-U.S. court judgment will not be recognized under the Act if:
    1. the court of tribunal did not have personal jurisdiction over the defendant; or
    2. the court or tribunal that issued the judgment was not impartial or did not offer due process of law.
  7. Bases for non-U.S. court’s exercise of personal jurisdiction over the defendant:
    1. Defendant was personally served in the forum country.
    2. Defendant appeared voluntarily before the forum court or tribunal and consented to jurisdiction.
    3. Defendant agreed to submit to jurisdiction of forum court before the action was commenced.
    4. Defendant was incorporated or domiciled in the forum country when the action was commenced.
    5. Defendant’s place of business was located in the forum country and the cause of action arose from that business location.
    6. Any other basis for personal jurisdiction that the state court in the U.S. chooses to recognize.
  8. Case law makes clear that proof of the forum tribunal’s impartiality and compliance with due process is a minimal standard; a non-U.S. court need not follow every procedure that a U.S. court would have done. Rather, the test is whether the procedures used by the non-U.S. court violated fundamental notions of decency and fairness. See, e.g., Ackerman v. Levine, 788 F.2d 830, 841-42 (2d Cir. 1986) (recognizing non-U.S. court judgment despite differences in procedures because, “[w]e are not so provincial as to say that every solution of a problem is wrong because we deal with it otherwise at home”) (quoting Judge Cardozo); S.C. Chemixem S.A. v. Velco Enterprises, Ltd., 36 F. Supp. 2d 206, 214-15 (S.D.N.Y. 1999) (recognizing Romanian judgment even though corruption remained in Romanian courts and judicial system was “far from perfect”; court could not say that Romanian judicial system was wholly devoid of due process).
  9. Discretionary Bases for Denial of Enforcement of Monetary Judgment: Even if the non-U.S. court judgment is final, conclusive and enforceable where rendered, the court had personal jurisdiction over the defendant, and the system of laws afforded due process of law, a state court in the U.S. need not recognize the judgment under certain circumstances.
    1. Where the non-U.S. court or tribunal did not have subject matter jurisdiction;
    2. Where the defendant did not receive adequate notice of the action in the non-U.S. court to enable the defendant to defend the action;
    3. Where the judgment was obtained by fraud;
    4. Where the cause of action or defense on which the judgment is based is repugnant to the state’s public policy;
    5. Where there is a conflict with another final and conclusive judgment; or
    6. Where the parties had agreed to another form of settlement of the dispute, i.e., arbitration.
  10. Reciprocity: Notably absent from the mandatory and discretionary grounds for non-recognition of judgments under the Act is reciprocity.
    1. While a majority of states have adopted the Act as drafted, a notable minority have written in significant modifications concerning reciprocity.
      1. Six states provide a discretionary basis for non-recognition on the grounds of lack of reciprocity: Florida, Idaho, Maine, North Carolina, Ohio and Texas.
      2. In Massachusetts and Georgia, the lack of reciprocity is a mandatory ground for non-recognition.
      3. Colorado has defined “foreign state” to include only those states that have entered into a reciprocal arrangement with the U.S. recognizing a judgment of a U.S. court. Since the U.S. has not entered into any such agreements, it appears that Colorado’s version of the Act would never result in the recognition of a foreign judgment. However, Colorado has recognized foreign judgments under principles of comity.
  11. Converting a non-U.S. court judgment for enforcement: If all the prerequisites for enforcement are met, the non-U.S. court judgment will be converted to a state court judgment. Generally this is done either by commencing a new action in the state court or by a form of summary proceeding. See, e.g., N.Y. CPLR 3213 (motion for summary judgment in lieu of complaint). Only after the non-U.S. court judgment is domesticated and converted to a state court judgment does it become enforceable as a judgment.

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