| PRACTICE — Claim form — Service out of jurisdiction — Claim to enforce foreign judgment against defendant resident abroad — Defendant having no assets within jurisdiction — Judge permitting service out of jurisdiction — Whether jurisdiction — Whether proceedings serving no useful purpose — Whether judge’s discretion properly exercised — CPR r 6.20(9)
Tasarruf Mevduati Sigorta Fonu v Demirel and another [2007] EWCA Civ 799
CA – Sir Anthony Clarke MR, Arden and Hooper LJJ: 26 July 2007
The court had power under CPR r 6.20(9) to permit service outside the jurisdiction of a claim to enforce a foreign judgment where the defendant, who lived abroad, had no assets in the jurisdiction. Ordinarily it would not be just to permit service outside the jurisdiction unless there was a real prospect of a legitimate benefit to the claimant from the English proceedings.
The Court of Appeal so held, granting permission to appeal but dismissing an appeal by the defendant, Yahya Murat Demirel, from the order of Lawrence Collins J on 26 December 2006, in which he dismissed the defendant’s application to set aside an order permitting the claimant, Tasarruf Mevduati Sigorta Fonu (“TMSF”) (the Turkish Savings Deposit Fund), to serve outside the jurisdiction a claim to enforce a judgment obtained against him in Turkey for US$30m.
SIR ANTHONY CLARKE MR, giving the judgment of the court, said that the defendant had sworn an affidavit stating that he had no assets here. He submitted, inter alia, that the court therefore had no jurisdiction to permit service out of the jurisdiction on the true construction of CPR r 6.20(9); and that, if there was jurisdiction, permission to serve out should have been refused on the ground that the proceedings would serve no useful purpose. In the court’s opinion, there was no reason to give the rule an unnatural construction or to imply restrictions into it. The rule was discretionary, so that the court would only grant permission if it was just to do so in all the circumstances of the case. It would ordinarily not be just to do so unless there was a real prospect of a legitimate benefit to the claimant from the English proceedings. That benefit did not have to be indirect or prospective. Thus a claimant seeking to enforce a foreign judgment by action did not have to show that there were assets in the jurisdiction. He had to show that he had a good arguable case in the action, i e that he had a good arguable case that judgment should be given based upon the foreign judgment. Ordinarily, he had further to show that he could reasonably expect a benefit from such a judgment. Otherwise there would be no useful purpose in the proceedings. It was important that the judgment had been obtained in Turkey on the basis of conclusions that the defendant was guilty of fraud. Experience suggested that in such cases, if the findings were true, it was often difficult to locate a defendant’s assets. It was a reasonable possibility that the defendant would have assets in London in future, either in the form of physical assets or in the form of claims against other institutions. If the appeal was allowed, and the proceedings set aside, no action could be brought in the future because it would be time-barred and the defendant would be able to bring funds to London free of a risk of execution. The continued existence of the action was of potential benefit to TMSF. |
