No mechanism for Court of Session to register EU member state judgment due to ‘lacunae in the law’

A judge allowed an appeal against the grant of warrant for registration after it emerged that the relevant part of the Rule of Court which relates to recognising judgments from courts of other member states in the European Union was “no longer in existence” when the warrant for registration was granted.

Lord Brailsford heard that the petitioners Drika BVBA, Roger can Craen and NV Malu sought registration of a judgment of the Court of First Instance of the judicial district of Antwerp from December 2013, which was granted in their favour for payment of a sum of money due to them by the respondent Clair Giles.

‘Lacunae in the law’

The petitioners sought warrant to register the judgment for execution in terms of Council Regulation (EC) No 44/2001 on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters, in accordance with the Civil Jurisdiction and Judgments Order (SI 2001 No 3929) 2001.

The petition was presented under the provisions of Rule 62.28 of the Rules of the Court of Session 1994 and by interlocutor dated 16 February 2017 Lord Boyd of Duncansby granted warrant to the Keeper of the Registers of Scotland to register a copy of the judgment.

The respondent appealed against the grant of warrant for registration but prior to the substantive hearing notes of argument were lodged, in which it was agreed between the parties that there was a “lacunae in the law” as the relevant part of Rule of Court 62.28 was no longer in existence when warrant for registration was granted.

Regulation (EC) 44/2001 requires that a judgment be registered for enforcement in the manner specified by the law of the relevant Member State, in terms of Article 38(2) and 40(1), but Part V of Chapter 62 of the Rules of the Court of Session was amended by Act of Sederunt (Rules of the Court of Session Amendment) (Regulation (EU) SI No 1215/2012 2015, which came into force on 7 February 2015 and provides that Chapter 62 is no longer to apply to cases brought under the “Council Regulation” – namely Regulation (EC) 44/2001.

Mr Bell for the petitioners submitted that the Rules Council “overlooked” the fact that the Brussels I Regulation remained in force and therefore suggested that the lacunae arose as a result of “an error”.

Mr Reid for the respondent said he had no explanation for the lacunae but in the absence of any information was not prepared to concede that it was the result of any error in those responsible for the rules.

Inherent power

The submission of counsel for the petitioners was that there were two means whereby what, as he submitted, was the obvious intention of Regulation (EC) 44/2001 could be implemented. The first was that the Regulation was plainly of “direct effect” and therefore conferred a jurisdiction on this court to entertain applications for registration of judgments from other member states. His second submission was that in any event the court had an “inherent power” to do what was necessary to “discharge its responsibilities”.

Having regard to the terms of Regulation (EC) 44/2001 counsel submitted that the court had a “direct responsibility” to ensure that a mechanism existed for the registration of decrees emanating from the court of another member state.

The submission of the respondent was first to observe that the repeal of the application of Regulation (EC) 44/2001 had been expressly provided for by Act of Sederunt. The present petition had therefore been presented in reliance upon a provision which was no longer in existence. The present application was therefore “incompetent” because the court had “no jurisdiction” to entertain the application.

It did not follow from that repeal that a lacuna had been created in the law in relation to registration of judgments of other member states. The common law remedy of decree conform could still be relied on. Counsel further submitted that even if he was incorrect in these submissions and there was a lacuna in the law, the correct form of procedure was by application to the nobile officium of the Court of Session and not by recourse to the method suggested by counsel for the petitioners.

‘No mechanism for registration’

Allowing the appeal and cancelling the registration, the judge said the circumstances which led to the petition being presented to the court were “highly unusual”.

In written opinion, Lord Brailsford said: “Like both counsel who appeared I can think of no plausible reason why the Rules of Court could have been amended in the way they were which seem to impede the ability to register certain decrees of courts of member states of the European Union. Whilst I find it relatively easy to reach that conclusion I am less certain whether this reflects, as was suggested by counsel for the petitioners, an error on the part of the Rules Council or there exists some other explanation. Whilst the position is apparently unsatisfactory I do not feel able to conclude that there has been an error. The implication of this is that there is no mechanism in the Rules of Court for registration of a decree such as the one in the present petition.”

As to whether there was any other method whereby the decree could be registered, thus avoiding the necessity of reliance on the common law remedy of decree conform or an application to the nobile officium of the Court of Session, the judge observed that while the regulation has direct effect in terms of the Article 38 TFEU, Article 40 states that the procedure for making an application is “governed by the law of the Member State in which enforcement is sought”.

Lord Brailsford continued: “The two authorities relied upon by the respondent appear to me to demonstrate that in circumstances where procedural implementation is left to a member state the ECJ will not recognise direct effect of the procedural requirement. In the circumstances in this case it is plain that the Rules of Court are merely a procedural mechanism for implementing the overall purpose of recognition of foreign decrees. Direct effect for these procedural mechanisms would appear to be precluded by the aforesaid decisions of the ECJ. I accordingly conclude that there is no argument on direct effect available to the petitioners.”

Turning to inherent jurisdiction, the judge further observed that on the basis of the authorities referred to it was clear that the court must use its powers in this area “with caution”, and that it would be inappropriate in this case – meaning the only option for the petitioners was to seek decree conform.

Lord Brailsford concluded: “The court should not seek to devise rules in relation to the practice of the court lightly. Whilst the court has some inherent power to regulate matters of practice the scope to interfere or innovate in relation to procedure controlled by Rules of Court is far more limited. That is exactly the position which applies in the present case. It follows that I do not feel able to rely on any inherent power as a means to innovate in the way suggested by counsel for the petitioners.

“I appreciate that by rejecting the arguments advanced by the petitioners they may be left with no option but to seek decree conform. I acknowledge that this may involve further procedure and incur additional expense. I would not regard these practical considerations, albeit I acknowledge their significance, as justification for innovation. In light of all the foregoing I will allow the appeal, recall the warrant for registration, and order cancellation of the registration of the judgment.”