Abu Dhabi Commercial Bank PJSC v. Saad Trading, Contracting & Financial Services Co.

117 A.D.3d 609, 986 N.Y.S.2d 454

This text of 117 A.D.3d 609 (Abu Dhabi Commercial Bank PJSC v. Saad Trading, Contracting & Financial Services Co.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Abu Dhabi Commercial Bank PJSC v. Saad Trading, Contracting & Financial Services Co., 117 A.D.3d 609, 986 N.Y.S.2d 454 (N.Y. Ct. App. 2014).

Opinion

Judgment, Supreme Court, New York County (Shirley Werner Kornreich, J), entered November 29, 2012, in an action seeking recognition and enforcement of a foreign country money judgment pursuant to CPLR article 53, awarding plaintiff the aggregate amount of $40,141,014.85, unanimously affirmed, with costs.

Plaintiff, a bank incorporated under the laws of the United Arab Emirates, entered into certain loan agreements with defendant, a limited partnership formed under the laws of the Kingdom of Saudi Arabia. These included an international swaps and derivatives agreement (ISDA) in which the parties consented to the non-exclusive jurisdiction of the English courts.

In 2009, based on an alleged event of default under the ISDA, plaintiff commenced a breach of contract action against defend[610]*610ant in the Commercial Court, Queen’s Bench Division, of the English High Court of Justice. Defendant appeared and did not contest jurisdiction. On July 27, 2010, the English court entered a judgment awarding plaintiff damages, plus prejudgment interest.

In August 2011, plaintiff filed this action seeking to domesticate and enforce the English judgment pursuant to CPLR 3213 and 5303. In opposition, defendant argued that the action should be dismissed on the grounds of lack of personal jurisdiction in New York and forum non conveniens, because neither defendant nor the underlying agreements and transactions had any connection to New York, and defendant did not have any assets in the state. Supreme Court rejected these arguments and entered judgment in plaintiffs favor in the total amount of the English judgment, together with postjudgment interest.

Defendant argues that the court erred in permitting plaintiff to domesticate the English judgment without first establishing a basis for asserting jurisdiction over defendant or its assets. Defendant contends that, as opposed to actions seeking recognition of a sister-state judgment under CPLR article 54, where a plaintiff need only register a judgment with a county clerk and personal jurisdiction need not be established, actions pursuant to CPLR 5303 for enforcement of foreign country money judgments are not exempted from the due process requirements of personal jurisdiction. For the following reasons, we reject defendant’s arguments.

“New York has traditionally been a generous forum in which to enforce judgments for money damages rendered by foreign courts” (CIBC Mellon Trust Co. v Mora Hotel Corp., 100 NY2d 215, 221 [2003], cert denied 540 US 948 [2003]). “Historically, New York courts have accorded recognition to the judgments rendered in a foreign country under the doctrine of comity . . . [a]bsent some showing of fraud in the procurement of the foreign country judgment or that recognition of the judgment would do violence to some strong public policy of this State” (Sung Hwan Co., Ltd. v Rite Aid Corp., 7 NY3d 78, 82 [2006] [internal quotation marks omitted]).

In accordance with this tradition, New York adopted the Uniform Foreign Country Money-Judgments Recognition Act as CPLR article 53 (see John Galliano, S.A. v Stallion, Inc., 15 NY3d 75, 79 [2010], cert denied 562 US —, 131 S Ct 288 [2010]), which was intended to codify and clarify existing case law applicable to the recognition of foreign country money judgments based on principles of international comity, “and, more importantly, to promote the efficient enforcement of New York [611]*611judgments abroad by assuring foreign jurisdictions that their judgments would receive streamlined enforcement here” (CIBC Mellon, 100 NY2d at 221).

Generally, a foreign country judgment is “conclusive between the parties to the extent that it grants or denies recovery of a sum of money” (CPLR 5303), “unless a ground for nonrecognition under CPLR 5304 is applicable” (Galliano, 15 NY3d at 80). CPLR 5304 (a) provides that “[a] foreign country judgment is not conclusive if. . . the judgment was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law” (para [1]) or “the foreign court did not have personal jurisdiction over the defendant” (para [2]). CPLR 5304 (b) permits nonrecognition on eight other grounds. Significantly, “[i]n proceeding under article 53, the judgment creditor does not seek any new relief against the judgment debtor, but instead merely asks the court to perform its ministerial function of recognizing the foreign country money judgment and converting it into a New York judgment” (CIBC Mellon, 100 NY2d at 222, quoting Lenchyshyn v Pelko Elec., 281 AD2d 42, 49 [4th Dept 2001]; see also Galliano, 15 NY3d at 81; CDR Créances S.A. v Euro-American Lodging Corp., 40 AD3d 421 [1st Dept 2007]).

In the present action, defendant has actual notice of the enforcement action and does not argue that the English judgment fails to meet the requirements of CPLR 5303 or that any grounds for nonrecognition of a foreign country money judgment exist. Nor does defendant provide a reason why the judgment should not be recognized as a matter of substance. Under these circumstances, “a party seeking recognition in New York of a foreign money judgment (whether of a sister state or a foreign country) need not establish a basis for the exercise of personal jurisdiction over the judgment debtor by the New York courts,” because “[n]o such requirement can be found in the CPLR, and none inheres in the Due Process Clause of the United States Constitution, from which jurisdictional basis requirements derive” (see Lenchyshyn, 281 AD2d at 47; see also Haaksman v Diamond Offshore [Bermuda], Ltd., 260 SW3d 476, 480 [Tex App 2008]; Pure Fishing, Inc. v Silver Star Co., Ltd., 202 F Supp 2d 905 [ND Iowa 2002]). Although CPLR 5304 (a) provides that the trial court may refuse recognition of the foreign country judgment if the foreign country court did not have personal jurisdiction over the judgment debtor, it does not provide for nonrecognition on the ground that the New York court lacks personal jurisdiction over the judgment debtor in a CPLR article 53 proceeding.

[612]*612Nor does the CPLR require the judgment debtor to maintain property in New York for New York to recognize a foreign money judgment. While CPLR 5304 provides a list of specific reasons why the trial court may refuse recognition of the foreign country judgment, the lack of property in the state is not one of them. Thus, “even if defendant ] do[es] not presently have assets in New York, plaintiff[ ] nevertheless should be granted recognition of the foreign country money judgment pursuant to CPLR article 53, and thereby should have the opportunity to pursue all such enforcement steps in futuro, whenever it might appear that defendant[ ] [is] maintaining assets in New York, including at any time during the initial life of the domesticated [English] money judgment or any subsequent renewal period” (Lenchyshyn, 281 AD2d at 50).

The procedural differences between CPLR articles 53 and 54 do not imply additional jurisdictional requirements in foreign country money judgment proceedings (see Lenchyshyn, 281 AD2d at 49). Rather, they exist because sister-state judgments must be given recognition under the Full Faith and Credit Clause of the United States constitution (US Const, art iy § 1) and sister-state courts are presumed (rebuttably) to be impartial and to apply procedures compatible with due process of law.

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Related

Shaffer v. Heitner
433 U.S. 186 (Supreme Court, 1977)
Haaksman v. Diamond Offshore (Bermuda), Ltd.
260 S.W.3d 476 (Court of Appeals of Texas, 2008)
Sung Hwan Co. v. Rite Aid Corp.
850 N.E.2d 647 (New York Court of Appeals, 2006)
CIBC Mellon Trust Co. v. Mora Hotel Corp. N.V.
792 N.E.2d 155 (New York Court of Appeals, 2003)
John Galliano, S.A. v. Stallion, Inc.
930 N.E.2d 756 (New York Court of Appeals, 2010)
Pure Fishing, Inc. v. Silver Star Co., Ltd.
202 F. Supp. 2d 905 (N.D. Iowa, 2002)
Wells Fargo Company v. . Davis
12 N.E. 42 (New York Court of Appeals, 1887)
Dietrick v. Kemper Insurance
556 N.E.2d 1108 (New York Court of Appeals, 1990)
CDR Créances S.A. v. Euro-American Lodging Corp.
40 A.D.3d 421 (Appellate Division of the Supreme Court of New York, 2007)
Hanscom v. Goldman
109 A.D.3d 964 (Appellate Division of the Supreme Court of New York, 2013)
Watary Services Ltd. v. Law Kin Wah
247 A.D.2d 281 (Appellate Division of the Supreme Court of New York, 1998)
De Nunez v. Bartels
264 A.D.2d 565 (Appellate Division of the Supreme Court of New York, 1999)
Lenchyshyn v. Pelko Electric, Inc.
281 A.D.2d 42 (Appellate Division of the Supreme Court of New York, 2001)

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Bluebook (online)
117 A.D.3d 609, 986 N.Y.S.2d 454, Counsel Stack Legal Research, https://law.counselstack.com/opinion/abu-dhabi-commercial-bank-pjsc-v-saad-trading-contracting-financial-nyappdiv-2014.