In cross-border disputes and litigation with foreign parties, receiving a judgment in your favour is sometimes only half the battle. Taking a judgment from one country and enforcing it in another can be just as difficult as the original proceeding.
To enforce a foreign judgment in Australia, it must first be registered in an appropriate Australian Court. There are several pathways to have a foreign judgment successfully registered in Australia. Unsurprisingly, some pathways are more straightforward than others. It all depends on what type of judgment it is and where it was made.
In this article, Emily Jennings and Mitchell Scott of Moulis Legal look at the common pathways used to register a foreign judgment in Australia and with which countries Australia has reciprocal arrangements.
Reciprocation under the Foreign Judgments Act 1991 (Cth)
The most common (and relatively easiest) way to register a foreign judgment is to rely on the reciprocity arrangements under the Foreign Judgments Act 1991 (Cth) and its regulations (“the Act”).
The Act permits the registration of monetary judgments made by superior Courts of a country designated as a jurisdiction of “substantial reciprocity”. In other words, if a judgment is made in a court and country that is already listed in the Schedule to the Act, then it is treated as a reciprocal judgment which paves the way for a more straightforward and uncontested application for registration.
Whilst the Act does contemplate non-monetary judgments being registered, the current regulations only permit registration of foreign monetary judgments.
The countries which Australia has reciprocal arrangements with under the Act include: Canada, Fiji, France, Germany, Hong Kong, Israel, Japan, Korea, Papua New Guinea, Singapore, Solomon Islands, Switzerland, Taiwan and the United Kingdom. Notably, the United States of America is not a country currently recognised by the Act.
There are additional criteria that must be met in order for the reciprocal judgment to be successfully registered in an Australia Court. For example, the foreign judgment must be final and conclusive; it must be less than six (6) years old; it must be enforceable in the Court in which it was made; and it must not have been already satisfied in the foreign jurisdiction.
There are of course some exceptions to these general rules and criteria, including the ability for non-monetary judgments or inferior court judgment to be considered reciprocal. The countries which are considered reciprocal can also change from time to time. For these reasons, it is always worthwhile to seek specialised advice about the particular foreign judgment you are trying to register in Australia.
Beware also that the judgment debtors do have the right under the Act to apply to set aside the registration of a foreign judgment in certain circumstances. This can include where the judgment was registered for an amount greater than the amount payable on the day of registration; if the judgment was obtained by fraud; and if the judgment has been discharged or wholly satisfied.
Bilateral treaties with New Zealand and the UK
Another pathway to having foreign judgments recognised in Australia is through bilateral treaties. This is not as common given that Australia is currently only a party to two bilateral treaties for the recognition of foreign judgments with New Zealand and the United Kingdom.
Australia’s arrangements with the United Kingdom are set out in the Reciprocal Recognition and Enforcement of Judgements in Civil and Commercial Matters 1994 (United Kingdom). For our friends across the ditch, the Agreement between the Government of Australia and the Government of New Zealand on Trans-Tasman Court Proceedings applies, and has been codified in the Trans-Tasman Proceedings Act 2010 (Cth).
Similar to the Act discussed above, judgments recognised through a bilateral treaty will be relatively easily accepted for registration by the Court. There are exclusions regarding the types of civil and commercial judgments that are recognised in Australia under these bilateral treaties, however both treaties provide for the registration of final judgments for monetary orders. The arrangements with New Zealand also extend beyond recognising judgments and includes other areas of litigation such as service of documents and subpoenas.
There is always the potential for Australia to enter into further international treaties (bilateral or multilateral) in the future, which could pave the way for judgments from other countries not covered by the Act or another treaty to be more easily recognised in Australia. But this is unlikely to happen soon.
Other multilateral treaties – the Hague Conventions
Another technical pathway to the recognition of foreign judgments is through the Hague Convention on Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters 1971. However, this convention has not been widely adopted and Australia is not a signatory.
The Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters 2019 is due to replace this ageing convention but is not yet in force. So far there are 28 signatories for the new version, who are at various stages of ratifying the convention. Australia remains a non-signatory.
Given this position, this convention is not an option when trying to register a foreign judgment for enforcement in Australia.
When all else fails, turn to common law
Just because a specific Court is not recognised by the Act or there is no international treaty with a specific country, does not mean the judgment is not capable of registration.
Of course, the process of registering judgments pursuant to the Act or bilateral treaties is far more streamlined by comparison, but there are common law principles which can still allow the registration of a foreign judgment.
Under common law, a judgment creditor can apply to register a monetary judgment from a foreign court of competent jurisdiction, if the following elements are satisfied:
- the parties are identical to the parties in the foreign judgment
- the judgment must be a monetary sum for a definite amount, that is not a penalty, fine or tax (with limited exceptions)
- the judgment must have been obtained in the last 12 years (depending on the relevant limitation period in the relevant Court)
- the judgment must be final and conclusive, and
- the court making the judgment must be an international jurisdiction recognised by Australian Courts.
The application process to register a judgment under common law is more burdensome than making an application under the Act. The process is dependent on the rules of the Court where registration is required, but generally it will require proceedings to be commenced by the usual court process. For example, by originating application or claim.
The judgment debtor can then challenge the registration of the foreign judgment on limited grounds, which include:
- the judgment being obtained by fraud
- registration of the judgment being contrary to public policy, and
- the proceedings in which the judgment was issued was conducted in a manner deemed contrary to the principles of natural justice.
It is important to note that the merit of a foreign judgment is not a valid defence to its registration in Australia. Australian Courts will not re-examine the merits of a foreign judgment, regardless of whether it is registered pursuant to the Act, a bilateral treaty, or under common law.
The pathway to registration ultimately depends on the judgment itself
Foreign judgments must be registered in Australia before they can be enforced. There are different pathways to get to registration, from having reciprocity recognised under the Foreign Judgments Act to relying on a bilateral treaty to applying common law principles.
Ultimately, how easy it is to register a foreign judgment in Australia will depend on what type of judgment it is (monetary or non-monetary); where it was issued (both the Court and the country are relevant); and whether there are any irregularities that the judgment debtor can rely upon to set aside registration.
Whichever pathway is chosen, all roads lead to enforcement. Once successfully registered in Australia, the judgment creditor will be free to enforce their foreign judgment against the judgment debtor by all the usual means.
This memo presents an overview and commentary of the subject matter. It is not provided in the context of a solicitor-client relationship and no duty of care is assumed or accepted. It does not constitute legal advice.
© Moulis Legal 2023
