Execution Of UAE Judgements In The United Kingdom And Australia

17 Jun 2023

Introduction

In today's interconnected world, where people and businesses frequently engage in cross-border transactions, it is crucial to acknowledge and enforce legal decisions made in foreign jurisdictions. This article aims to provide a comprehensive explanation of the execution of judgments issued in the United Arab Emirates (UAE) in two significant jurisdictions, the United Kingdom (UK) and Australia while providing examples of noteworthy instances. Therefore, it is imperative for lawyers, individuals, and businesses involved in international legal disputes to grasp the procedures and requirements necessary for enforcing UAE judgments in these jurisdictions. 

To that end, let's consider an example for better understanding and envision a scenario where "Company A," a UK-based entity, enters into a contractual agreement with "Company X," a UAE-based organization, for the procurement of specific goods. Unfortunately, Company X fails to fulfil the agreed-upon obligations, resulting in delays and financial losses for Company A. In such a case, if Company A successfully obtains a judgment against Company X in the UAE court, understanding the process of enforcing this judgment within the UK becomes vital. The same example applies if Company A is an Australian-based company. Thus, this article will outline the specific steps involved, including the necessary documentation, timeframes, and potential challenges such as jurisdictional issues, recognition requirements, and potential enforcement methods to help navigate the process seamlessly.

 

  1. Legal Framework And Applicable Laws

A. United Kingdom:

  1. Recognition and enforcement of foreign judgments in the UK are governed by the common law principle of reciprocity, which ensures that judgments from countries that recognize and enforce UK judgments are reciprocally recognized and enforced in the UK;
  2. The legislative framework for the enforcement of foreign judgments in the United Kingdom is provided by the Civil Jurisdiction and Judgments Act 1982. This Act sets out the procedures and requirements for the recognition and enforcement of foreign judgments in the UK;
  3. The United Kingdom is also a signatory to several international conventions that aim to facilitate the recognition and enforcement of foreign judgments. Notably, the UK is a party to the Hague Convention on Choice of Court Agreements 2005, which establishes rules for the recognition and enforcement of judgments based on exclusive choice of court agreements.

B. Australia:

  1. The recognition and enforcement of foreign judgments in Australia are predominantly regulated by the Foreign Judgments Act 1991 (Cth). This legislation provides a framework for the enforcement of foreign judgments in Australia, ensuring that judgments from certain countries are recognized and enforced in Australian courts;
  2. The rules for enforcement differ depending on whether the judgment originates from a country with a reciprocal enforcement arrangement or a non-reciprocating country. Reciprocal enforcement countries are those with which Australia has entered into agreements facilitating the mutual recognition and enforcement of judgments;
  3. Australia is also a party to several bilateral and multilateral conventions that impact the enforcement of foreign judgments. Significantly, Australia has recently become a party to the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters 2019. This convention aims to establish a global framework for the recognition and enforcement of foreign judgments, promoting international legal cooperation and certainty.

 

  1. Requirements For Recognition And Enforcement

A. United Kingdom

Although both the United Arab Emirates (UAE) and the United Kingdom (UK) have established a treaty for extradition and judicial cooperation, which is ratified under Federal Law number 38 of 2007 for judicial cooperation between the two countries, there is currently no specific bilateral treaty in place for the reciprocal recognition of judgments issued by either country. However, it is worth noting that the courts of the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM) have entered into a memorandum of understanding with English Courts to facilitate the reciprocal recognition and enforcement of judgments.

Due to the absence of a bilateral treaty, parties involved in a legal dispute face various challenges. Their only available option is to initiate a claim against the judgment debtor before the courts of England, relying on common law principles. It is crucial to highlight that for such a claim to be entertained, the judgment must meet the following requirements:

  1. The judgment must be final and conclusive, with no pending appeal. This means that all avenues for appeal within the UAE legal system must have been exhausted, and no further appeals are available;
  2. The court that rendered the judgment must have had jurisdiction over the dispute. Jurisdiction can be established through various factors, such as the defendant's presence within the UAE jurisdiction, the defendant's submission to the UAE court's jurisdiction, or an exclusive choice of court agreement between the parties;
  3. The judgment must not conflict with public policy or principles of natural justice in the United Kingdom. This ensures that the enforcement of the judgment aligns with fundamental legal principles and does not violate the core values of the UK legal system, including considerations of fairness, equity, and public interest;
  4. Certain procedural requirements must have been fulfilled, including proper service of process and protection of due process rights. This means that the judgment debtor must have been properly notified of the proceedings and given a reasonable opportunity to present their case in the UAE proceedings.

B. Australia:

  1. The judgment must be final and conclusive, with no further avenue for appeal within the UAE legal system. This means that all rights to appeal or review the judgment must have been exhausted, and no further appeals are available;
  2. The court in which the judgment was obtained must have exercised jurisdiction according to Australian law. This ensures that the UAE court's exercise of jurisdiction aligns with the principles and rules of jurisdiction recognized by the Australian legal system;
  3. The judgment must not be contrary to public policy, and principles of natural justice should have been observed. This requirement ensures that the enforcement of the judgment does not violate fundamental principles of fairness, equity, and the rule of law in Australia, including considerations of public interest and procedural fairness;
  4. If the judgment is from a non-reciprocating country, additional conditions may apply. In such cases, there may be a need to establish a legitimate connection between the judgment debtor and Australia to justify the enforcement of the judgment. This connection could be demonstrated through factors such as the judgment debtor's assets located in Australia or their business activities within the country.

 

  1. Procedure For Enforcement

A. United Kingdom:

  1. The judgment creditor must initiate the process by applying for the registration of the UAE judgment at the appropriate court in the UK. In England and Wales, this would be either the High Court or the County Court, while in Scotland or Northern Ireland, it would be the relevant courts in those jurisdictions;
  2. The application for registration should include essential documents, such as a certified copy of the UAE judgment and evidence demonstrating its enforceability. These documents serve to provide the court with the necessary information to evaluate the judgment and determine its suitability for enforcement;
  3. The court will carefully review the application and supporting documents. If satisfied that the requirements for enforcement have been met, the court will issue an order for enforcement, which carries the same legal effect as a domestic judgment. This order empowers the judgment creditor to take appropriate measures to enforce the UAE judgment in the UK.

B. Australia:

  1. The judgment creditor must initiate proceedings in an Australian court, seeking a declaration that the UAE judgment is enforceable. This involves commencing a legal action to have the Australian court formally recognize the UAE judgment and authorize its enforcement;
  2. The Australian court will carefully examine the eligibility of the judgment for enforcement, ensuring compliance with the requirements under the Foreign Judgments Act 1991 (Cth) and any relevant bilateral or multilateral conventions. The court will assess factors such as the finality of the judgment, jurisdictional issues, and conformity with public policy and principles of natural justice;
  3.  Once the Australian court grants the order for enforcement, the UAE judgment will be treated as if it were a judgment rendered by the Australian court itself. This grants the judgment creditor the same rights and powers to execute the judgment as they would have with a domestic judgment.

 

  1. Grounds For Refusal

A. United Kingdom:

  1. Lack of jurisdiction by the UAE court: The UK court may refuse to enforce a UAE judgment if it determines that the UAE court did not have the requisite jurisdiction over the dispute. This could occur if the UAE court lacked jurisdiction over the subject matter or the parties involved in the case.
  2. The judgment was obtained by fraud: If it can be proven that the UAE judgment was obtained through fraudulent means, such as the presentation of false evidence or deliberate misrepresentation, the UK court may refuse to enforce the judgment.
  3. The judgment is contrary to public policy or natural justice: The UK court may refuse to enforce a UAE judgment if it is contrary to the fundamental principles of public policy or natural justice in the United Kingdom. This includes situations where the enforcement of the judgment would lead to an unjust or unfair outcome.

B. Australia

  1. Lack of jurisdiction by the UAE court: Similar to the UK, the Australian court may refuse to enforce a UAE judgment if it determines that the UAE court did not have the necessary jurisdiction over the dispute.
  2. The judgment was obtained by fraud: If it can be demonstrated that the UAE judgment was procured through fraudulent means, such as the deliberate manipulation of evidence or misrepresentation, the Australian court may refuse to enforce the judgment.
  3. The judgment is contrary to Australian public policy: The Australian court may refuse to enforce a UAE judgment if it is contrary to the fundamental principles of public policy in Australia. This includes situations where the enforcement of the judgment would lead to outcomes that are fundamentally unjust or contrary to the values upheld by the Australian legal system.

 

Case Study

In the case of Lenkor Energy Trading DMCC v Puri [2020], the English High Court (the Court) granted recognition and enforcement of a Dubai court judgment after a hearing in January 2020. The defendant, in this case, raised objections to the recognition of the Dubai court judgment, asserting that its enforcement would be contrary to the public policy of England and Wales. The defendant presented various arguments based on public policy concerns. These included the contention that the underlying agreement was tainted by illegality, that holding the defendant personally liable would involve piercing the corporate veil, and that the interest charged on the debt was excessively punitive. However, the Court rejected these arguments. The Court emphasized that the divergence between the laws of the UAE and the UK, as well as any differences in the approach of an English court compared to the UAE court, were not relevant factors in determining the enforcement of the judgment. The Court clarified that the judgment would only be denied enforcement if it actually violated English public policy, which was not the case in this instance.

 

Conclusion

Enforcing UAE judgments in the UK and Australia requires navigating the legal frameworks specific to each jurisdiction. Understanding the requirements, procedures, and grounds for refusal is vital for both judgment creditors and debtors involved in cross-border disputes. Seeking legal advice from experienced professionals is strongly recommended to ensure the successful execution of UAE judgments in the UK and Australia.