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The Possibility of Recognising and Enforcing Chinese Judgment in United States

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s a Chinese litigation lawyer, I write this article to talk about the possibility enforce Chinese judgment in the United States. I hope it will help Chinese lawyer to enlarge their vision over the United States judicial rules of recognize and enforcement of foreign judgment. The main message is that different states have different rules. The recognition and enforcement of a Chinese judgment in one state doesn't mean other state will do the same.

An Example of a Chinese Judgment Recognized in U.S.

On August 12, 2009, the United States District Court for the Central District of California issued a judgment enforcing a $6.5 million dollar Chinese judgment against an American corporate defendant under California’s version of the Uniform Foreign Money Judgments Recognition Act. The court’s full decision is available here.

This case is unique because it is generally believed that United States courts will not enforce Chinese judgments given the lack of a treaty between the two countries on the issue and given that Chinese courts generally do not enforce United States judgments in China, which limits the argument for reciprocity in the United States. Given this decision, California may become a favorable forum for enforcement of Chinese judgments in the United States.

China lawyer Blog

This just a news, Chinese lawyers have to know more United States rules to learn how to recognize and enforce a Chinese judgment in United States. The following is a case:

Hilton v Guyot
Diversity case from the pre-Erie era. Set out 5 requirements:
• Afforded an opportunity for full and fair proceedings.
• Court was a competent jurisdiction over persons and subject.
• Court conducted regular proceedings which afforded due notice of appearance to adversaries.
• Court afforded a system of jurisprudence that was impartial.
• Reciprocity of recognition and enforcement of judgment.

 

Takeaway

In United States, federal law determines whether one state recognizes another state judgments, but state law determines whether states recognize foreign judgments.

In United States, federal law determines whether one state recognizes another state judgments, but state law determines whether states recognize foreign judgments. Most states use the Uniform Foreign Money Judgments Recognition Acts (Recognition Act). There was another version of this in 2005, but not many ratified it.

Exceptions:

• Not impartial
• no personal jurisdiction
• no subject matter jurisdiction
• defendant didn't get notice
• fraud
• Repugnant to public policy
• conflicts with another final judgment
• ignored arbitration
• inconvenient forum

Same rules as in Hilton included in this act. Different states look differently at reciprocity. Recognition Act does not require it, but some states do. States adopted it, but with some alterations. For example, Massachussets law has the Act, but they have a reciprocity requirement in it (Evans). EOS is Florida law and they don't seem to have a reciprocity clause.

Evans
• Brought in Quebec
• Both companies are US companies, but Defendant's principal place of business is in Quebec.
• Default judgment given in Canada against Plaintiff.
• Res Judicata (recognition) issue here. Whether or not to block in the state of Mass.
• Plaintiff argue no recognition because no jurisdiction over them, because they say they had no contract to do work in Montreal, and have no contact with Quebec whatsoever.
• One guy who made all these deals, but no one seems to be able to find him.
• The initial court applied both Quebec and Mass law, and this court decided to go with it because no one argued that this was a bad idea.
• Court was not convinced that Canada had personal jurisdiction, means there shouldn't have been summary judgment.
• Massachussets have the personal jurisdiction through the long-arm statute. Just means that the court can directly go to the constitutional analysis for due process.
Claim must be related to business conducted in the state must have availed self of benefits.

Federal Court sitting in diversity in Florida has to apply state law (above). Below was state court:


Eos v Agrisource
• Canadian Company filed in Canada against Defendant
• Looking at enforcement of the Canadian judgment.
• Defendant argues they didn't have enough contact with Canada to have personal jurisdiction there.
• Foreign Money Judgment are prima facie enforceable, except for lack of personal jurisdiction.
• Court focuses on the minimum contacts analysis, and whether sense of fair play and substantial justice are satisfied.
• They don't talk about Gestalt factors explicitly, but they do discuss reasonableness.
• Court held they wouldn't enforce it, so even though EOS could get judgment, not enough to get enforcement of it.

Enforcement of judgments

Once you finally get a judgment, you still have to find out whether it can be recognized or enforced.
Recognition/enforcement if
1. Defendant had proper notice
2. Proper jurisdiction (subject and personal)
3. Procedures were full, fair objective
Reciprocity--do we enforce their judgments, and will they enforce ours? Big question, because the only way to know for sure if it doesn't exist, if a country says we refuse to recognize the laws of this country. If that's there, you know there's no reciprocity. How do you know if it exists if there's nothing saying it doesn't? Judgments are mostly refused where country has made a huge point about refusing to accept judgments (or if the country whose judgments were refused may reciprocally refuse that states' judgments).

Some states added the requirement of reciprocity to their Money Act.

Is it proper to question other courts' judgment of whether they have jurisdiction where there are claims that there must be personal jurisdiction both in the court where the decision is made, and in the court where it is being enforced.

Full Faith & Credit clause

Has an exception that doesn't apply directly to what we're talking about, but applies to things like DOMA. Exception is a public policy exception. Public policy applies no to the judgments made internationally, but other actions and statutes by states. Mostly coming into play here in same-sex marriage. It's an official act of the state, that there can be a public policy exception to, but it's a decision of the state.

 
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