ECHR Rules on Enforcement of Judgments under Brussels I

On 25 February 2014, the European Court of Human Rights ruled in the case of Avotinš v. Latvia (application no. 17502/07) that the Brussels I Regulation imposes on Member States a duty to enforce judgments in civil and commercial matters, which triggers the Bosphorus presomption of compatibility of the actions of the enforcing state with the European Convention.

The judgment, which is only available in French, reveals a lack of knowledge of European private intenational law instruments by the members of the court.

The Court rules that the foundation of the Brussels I Regulation is mutual trust. That’s of course correct. It then insists that under the Brussels I Regime, declarations of enforceability are granted almost automatically, after mere formal verification of documents. It thus concludes that under the Regulation, Member States are obliged to enforce foreign judgments, and should thus benefit as requested states from the Bosphorus presumption.

49.  La Cour relève que, selon le préambule du Règlement de Bruxelles I, ce texte se fonde sur le principe de « confiance réciproque dans la justice » au sein de l’Union, ce qui implique que « la déclaration relative à la force exécutoire d’une décision devrait être délivrée de manière quasi automatique, après un simple contrôle formel des documents fournis, sans qu’il soit possible pour la juridiction de soulever d’office un des motifs de non-exécution prévus par le présent règlement » (paragraphe 24 ci-dessus). À cet égard, la Cour rappelle que l’exécution par l’État de ses obligations juridiques découlant de son adhésion à l’Union européenne relève de l’intérêt général (Bosphorus Hava Yollar Turizm ve Ticaret Anonim irketi précité, §§ 150-151, et Michaud c. France, no 12323/11, § 100, CEDH 2012) ; le sénat de la Cour suprême lettonne se devait donc d’assurer la reconnaissance et l’exécution rapide et effective du jugement chypriote en Lettonie.

50.  Devant les juridictions lettonnes, le requérant soutenait que la citation de comparaître devant le tribunal de district de Limassol et la demande de la société F.H.Ltd. ne lui avaient pas été correctement communiquées en temps utile, de sorte qu’il n’avait pas pu se défendre ; par conséquent, selon lui, la reconnaissance de ce jugement devait être refusée sur la base de l’article 34, point 2, du Règlement. Dans son arrêt du 31 janvier 2007, le sénat de la Cour suprême a écarté tous ses moyens – et, donc, l’application de l’article 34, point 2, du Règlement – en déclarant que, le requérant « n’ayant pas fait appel du jugement, les arguments de son avocat selon lesquels [il] ne se serait pas vu dûment notifier l’examen de l’affaire par un tribunal étranger, n’ont aucune importance ». Cela correspond en substance à l’interprétation donnée à la disposition susmentionnée par la Cour de justice des Communautés européennes dans l’arrêt Apostolides c. Orams, aux termes duquel « la reconnaissance ou l’exécution d’une décision prononcée par défaut ne peuvent pas être refusées au titre de l’article 34, point 2, du règlement no 44/2001 lorsque le défendeur a pu exercer un recours contre la décision rendue par défaut et que ce recours lui a permis de faire valoir que l’acte introductif d’instance ou l’acte équivalent ne lui avait pas été signifié ou notifié en temps utile et de telle manière qu’il puisse se défendre » (paragraphe 28 ci-dessus).

This is the part of the reasoning of the court which is plainly wrong. It fails to discuss the relevance of the public policy exception and the margin of appreciation that it offers to requested states to verify whether the state of origin respected fundamental rights.

PRESS RELEASE

The case concerned the enforcement in Latvia of a judgment delivered in Cyprus concerning the repayment of a debt. The applicant, an investment consultant who had borrowed money from a Cypriot company, complained that the Cypriot court had ordered him to repay his debt under a contract without summoning him properly and without guaranteeing his defence rights.

Like the Senate of the Latvian Supreme Court, the Court noted that the applicant should have appealed against the Cypriot court’s judgment. It took the view that the Latvian authorities, which had correctly fulfilled the legal obligations arising from Latvia’s status as a member State of the European Union, had sufficiently taken account of Mr Avotinš’

 PRINCIPAL FACTS

The applicant, Peteris Avotinš,  is a Latvian national who was born in 1954 and lives in the district of Riga (Latvia).

On 4 May 1999 Mr Avotinš and F.H.Ltd., a commercial company registered in Cyprus, signed before a notary a formal acknowledgement of his obligation to repay a debt. Mr Avotinš declared that he had borrowed 100,000 United States dollars from F.H.Ltd. and undertook to repay that amount with interest before 30 June 1999. The document stated that it would be governed “in all respects” by the laws of Cyprus and that Cypriot courts would have jurisdiction to hear all disputes arising from it.

In 2003 F.H.Ltd. sued Mr Avotinš in the court of Limassol (Cyprus), declaring that he had not repaid his debt and seeking an order against him. On 24 May 2004, ruling in his absence, the Cypriot courts ordered Mr Avotinš to repay his debt together with interest and costs and expenses. According to the judgment, the applicant had been duly informed of the date of the hearing but had not appeared.

On 22 February 2005 F.H.Ltd applied to the court for the district of Latgale (Riga) seeking the recognition and enforcement of the Cypriot judgment of 24 May 2004. The company also called for an interim measure of protection.

On 27 February 2006 the Latvian court ordered the recognition and enforcement of the Cypriot judgment of 24 May 2004 and the registration of a charge against Mr Avotinš’ property in the land register.

Mr Avotinš claimed that he had became aware, by chance, on 16 June 2006, of the existence of both the Cypriot judgment and the Latvian court’s enforcement order. He did not attempt to challenge  the Cypriot judgment before the Cypriot courts but appealed in the Regional Court of Riga against the Latvian enforcement order.

In a final judgment of 31 January 2007 the Senate of the Latvian Supreme Court upheld F.H. Ltd.’s claim, ordering the recognition and enforcement of the Cypriot judgment together with the registration of a charge against the applicant’s property in the land register. On the basis of that judgment, the court of Latgale delivered a writ of execution and Mr Avotinš complied by repaying his debt. The registered charge on his property was lifted shortly afterwards.

The applicant complained that by enforcing the judgment of the Cypriot court, which in his view was clearly unlawful as it disregarded his defence rights, the Latvian courts had failed to comply with Article 6 § 1 (right to a fair hearing within a reasonable time).

The application was lodged with the European Court of Human Rights on 20 February 2007.

JUDGMENT

Article 6 § 1

The Court noted that the judgment on the merits had been delivered on 24 May 2004 by the Cypriot court and the Latvian courts had ordered its enforcement in Latvia. Having, by a partial decision on 30 March 2010, declared inadmissible the complaint against Cyprus as being out of time, the Court did not have jurisdiction to decide whether or not the court of Limassol (Cyprus) complied with the requirements of Article 6 § 1. It was nevertheless for the Court to decide whether, in ordering the enforcement of the Cypriot judgment, the Latvian judges complied with the provisions of Article 6 § 1 of the Convention.

The Court observed that the fulfilment by the State of the legal obligations arising from its  membership in the European Union was a matter of general interest. The Senate of the Latvian Supreme Court had a duty to ensure the recognition and the rapid and effective enforcement of the Cypriot judgment in Latvia.

Mr Avotinš had argued before the Latvian courts that the summons to appear before the court of Limassol and the statement of claim by the company F.H.Ltd. had not been properly served on him in a timely manner, with the result that he had not been able to defend himself. Consequently, the  Latvian courts should have refused the enforcement of the Cypriot judgment.

The Court observed that, in its final judgment of 31 January 2007, the Senate of the Latvian Supreme Court had declared that Mr Avotinš had not appealed against the Cypriot judgment. Mr Avotinš had indeed not sought to lodge any appeal against the Cypriot court’s judgment of 24 May 2004. Mr Avotinš, an investment consultant who had borrowed money from a Cypriot company and had signed a recognition of debt governed by Cypriot law with a clause conferring jurisdiction on the Cypriot courts, had accepted his contractual liability of his own free will: he could have been expected to find out the legal consequences of any non-payment of his debt and the manner in which proceedings would be conducted before the Cypriot courts.

The Court took the view that Mr Avotinš had, as a result of his own actions, forfeited the possibility of pleading ignorance of Cypriot law. It was for him to produce evidence of the inexistence or ineffectiveness of a remedy before the Cypriot courts, but he had not done so either before the Senate of the Latvian Supreme Court or before the European Court of Human Rights.

Having regard to the interest of the Latvian courts in ensuring the fulfilment of the legal obligations arising from Latvia’s status as a member State of the European Union, the Court found that the Senate of the Latvian Supreme Court had sufficiently taken account of Mr Avotinš’ rights.

There had been no violation of Article 6 § 1 in the present case.

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About Gilles Cuniberti

Gilles Cuniberti is a professor of law at the University of Luxembourg. Previously, he taught for 10 years at the Faculty of Law of Paris 12 University (Paris Val-de-Marne). His primary teaching and research interests are comparative law, conflict of laws, international arbitration and international litigation. He is a regular contributor to the Journal de Droit International (Clunet). He has been a visiting faculty at Duke Law School, Renmin University of China and Sheffield Hallam University. He holds a Doctorate in Law from Paris I Panthéon-Sorbonne University and an LL.M. degree from Yale Law School. He was also a Paris-Oxford Doctoral Program Scholar for a year at Trinity College, Oxford. He is admitted to the Paris Bar and practiced on a part-time basis in the Paris office of a leading English firm from 1999 to 2004. SELECTED ARTICLES: Beyond Contract - The Case for Default Arbitration in International commercial Disputes, 32 FORDHAM INT'L L.J. 417 (2009) Le principe de territorialité des voies d'exécution, JOURNAL DU DROIT INTERNATIONAL 2008.963 The Recognition of Judgments Lacking Reasons in Europe: Access to Justice, Foreign Court Avoidance and Efficiency, 57 INT’L & COMP. L. Q. 25 (2008) L’apprezzamento dell’efficacia della clausola arbitrale da parte del giudice statale : un conflitto tra Italia e Francia, 21 DIRITTO COMMERCIO INTERNAZIONALE 2007.789 (with M. Winkler) E-mail: gilles.cuniberti@conflictoflaws.net