Enforcement of a foreign judgment: High Court upholds public policy defence
Laserpoint Ltd v Prime Minister of Malta & Others
Helen Coates, who acted for the successful appellant, Laserpoint Ltd, looks at this rare example of the court in England upholding the public policy defence to prevent enforcement of a judgment of a court in another EU member state.
Laserpoint had appealed against registration in England & Wales of a judgment of a Maltese court which had held Laserpoint jointly liable for fire damage at a conference centre in Malta in 1987, on the basis it would be manifestly contrary to public policy to recognise the judgment. The High Court, allowing the appeal, held that this was an exceptional case where Laserpoint had been denied a fair trial by reason of, amongst other things, inordinate delay in the completion of the Maltese proceedings and failure of the court appointed curator to establish contact with Laserpoint and obtain instructions.
In March 1987, the appellant, Laserpoint Ltd (‘Laserpoint’) had been preparing a laser lighting display for a vehicle launch at a conference centre in Malta. A fire broke out, causing extensive damage to the conference centre.
The respondents, being the Prime Minister of Malta and others, issued proceedings in Malta in April 1987 alleging a laser had caused the fire and claimed damages in excess of €6m. On 5 May 1987, a copy of the writ was sent to Laserpoint at its registered address in London. Laserpoint had by then changed its registered address, but Companies House did not alter the Register until 18 May. Laserpoint claimed not to have received the writ or to have been aware of the proceedings against it. The Maltese court appointed curators (legal representatives) for Laserpoint as it was not represented in Malta. Laserpoint was dissolved in 1997. On at least two occasions (in 2001 and 2003), the curator informed the Maltese court of that fact. The curator then ceased to act for Laserpoint from around 2004 but the Maltese proceedings resumed in 2007 after a period of inactivity. With no attempt having been made to contact Laserpoint prior to judgment being entered, judgment was given by the First Civil Court of Malta in January 2013 in which Laserpoint and the organiser of the vehicle launch were held jointly and severally liable to pay damages in excess of €3.3m.
The attempt to enforce
In November 2015 Laserpoint was restored to the Register on an application by the respondents who then obtained an Order in March 2016 for registration and enforcement of the judgment in England and Wales pursuant to the EC 44/2001 (the Brussels I Regulation) and/or the Administration of Justice Act 1920 and/or Common Law, the intention being to seek enforcement against Laserpoint’s insurer at the relevant time. Laserpoint appealed and following service of their Grounds of Appeal, the respondents abandoned pursuit of registration and enforcement under the AJA and/or Common Law.
Regulation 44/2001 (Brussels I Regulation) Art.34 provides that a judgment shall not be recognised either if recognition would be manifestly contrary to public policy in the Member State in which recognition was sought (Art.34(1)) or "where [judgment] was given in default of appearance, if the defendant was not served with the document which instituted the proceedings or with an equivalent document in sufficient time and in such a way as to enable him to arrange for his defence, unless the defendant failed to commence proceedings to challenge the judgment when it was possible for him to do so" (Art.34(2)).
Laserpoint argued it had been unaware of the Maltese proceedings, it having not been contacted by the curator and the proceedings had not come to its attention until several months after the Judgment had been issued. In failing to contact Laserpoint and acting without instructions and authorisation from them, it was argued that this was therefore not competent and authorised representation per Hendrikman v Magenta Druck Case C-78/95. Laserpoint argued its right to a fair trial, including the right to be defended, pursuant to Article 6 ECHR had been breached and relied on the cases of Krombach v Bamberski Case C-7/98 and Maronier v Larmer  EWCA Civ 774,  Q.B. 620.
Public policy defence upheld
Laserpoint’s appeal was allowed. It was held that the recognition sought was based on a judicial process which was unfair and manifestly contrary to public policy, entitling Laserpoint to rely on Art.34 (1) as a fair trial had not taken place so far as the appellant was concerned. Laserpoint was entitled both to a fair trial and for that to occur within a reasonable time.
The proceedings in Malta had taken an extraordinary length of time to be completed (some 26 years) and the Court had regard to a combination of other factors including (i) there was no evidence the curator sought direct instructions from Laserpoint; (ii) Laserpoint was dissolved in 1997; iii) the court gave no directions on the curator's application to be released from the case; iv) the case was revived in 2007 in an important way but Laserpoint was not informed; v) there was no contact with Laserpoint before the judgment was handed down. Those factors and the delay that had occurred meant that Laserpoint had been deprived of its right to a fair trial, Maronierapplied.
For completeness it was also held that recognition of the judgment would also have been refused under Art.34 (2). Although service of the writ was valid, Laserpoint had not received the relevant document in such a way as to enable it to arrange for its defence. The judgment was given in default of appearance given the history of lack of contact between the curators and Laserpoint and the complete absence of instructions from Laserpoint from 1987 onwards. Further, it could not be said that Laserpoint had failed to commence proceedings to challenge the judgment when it was possible for it to do so. It did not know about the judgment until after the applicable 20 day period for challenging it in Malta had expired, and under the Maltese legal structure there was no realistic possibility of an extension of time for the lodging of an appeal. The Court distinguished between a theoretical possibility of challenging a judgment and a realistic one noting that there would be no point at all in the wording of the latter part of Article 34(2) if the prospect of proceedings to challenge a judgment is not realistically possible.
For further information please contact Helen Coates, Director, Commercial Insurance, acted for the successful appellant on email@example.com or +44 161 604 1607
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