Foreign judgment – Recognition and enforcement – Conflict of laws – Claimant seeking to reclaim land in area controlled by Turkish Republic of Northern Cyprus – Whether judgment enforceable in English court – English court referring to European Court of Justice for preliminary ruling – Whether Council Regulation 44/2001 applicable – Preliminary ruling made
The claimant was a Greek Cypriot whose family owned land in northern Cyprus. When the Turkish army invaded Cyprus in 1974, the family was forced to abandon their house and live in a government-controlled area. The defendant British citizens had purchased the land in 2002 from a third party, who in turn had acquired it from the authorities of the Turkish Republic of Northern Cyprus (TRNC), an entity recognised only by the Republic of Turkey. The defendants built a villa on the land, which they used as a holiday home.
Once the restriction on the movement between the northern area and the government-controlled area was lifted in 2003, the claimant brought proceedings to reclaim the land. A Cypriot court established in the government-controlled area issued the documents instituting proceedings. The documents, written in Greek, were served on the defendants at the Cyprus property. They refused to sign for them. Following the defendants failure to enter an appearance within 10 days of service, as required under Cypriot law, a default judgment ordered them to: (i) demolish the villa, swimming pool and fencing erected on the land; (ii) deliver free possession of the land to the claimant; (iii) pay the claimant various sums by way of special damages; (iv) pay monthly rent together with interest until they had complied with the judgment; and (v) refrain from their continuing unlawful intervention on the land.
The defendants’ application to have the judgment set aside was dismissed by the Cypriot court on the ground that they had not submitted an arguable defence to dispute the claimant’s title to the land. After the defendants’ appeal had been dismissed, the claimant produced the documents required in England to apply for the recognition and enforcement of the judgment.
A master of the High Court ordered that the judgment be enforced in England pursuant to Council Regulation 44/2001 (on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters). The defendants appealed and the order was set aside by a High Court judge. He held that the effect of Protocol 10 to the Treaty of Accession to the European Union was that the acquis communautaire, that is, the entire body of the EU legislation, and therefore Regulation 44/2001, was of no effect in respect of matters that related to the area controlled by the TRNC. The claimant appealed to the Court of Appeal, which referred to the European Court of Justice (ECJ) for a preliminary ruling on the construction of Regulation 44/2001.
Held: The preliminary ruling was made.
The Act of Accession of a new member state to the EU was based upon the general principle that the provisions of Community law applied from the outset and in their entirety to that state. Protocol 10 constituted a transitional derogation from that principle based upon the exceptional situation prevailing in Cyprus, and the suspension for which it provided was limited to the application of the acquis to the island’s northern area. It did not nullify the application of Regulation 44/2001 to a judgment given by a court in the government-controlled area concerning land that was situated in the northern region.
Contrary to the view of the European Commission, the issue in the main proceedings did concern civil and commercial matters within the meaning of article 1(1) of Regulation 44/2001; the action involved individuals, and its object was to: (i) obtain damages for the unlawful possession of land; (ii) deliver that land; (iii) to restore it to its original state; and (iv) cease any other unlawful intervention. That action was not brought against any conduct or procedures involving an exercise of public powers by one of the parties to the case, but against acts carried out by individuals.
The fact that the judgment was given by the court of a member state and concerned land situated in an area of that state over which its government did not exercise effective control, did not constitute an infringement of the rule of jurisdiction laid down in article 22(1) of Regulation 44/2001 justifying a refusal to recognise or enforce such a judgment in accordance with article 35(1). The rule in article 22(1) concerned the international jurisdiction of the courts of the member states and not their domestic jurisdiction. Although it was not for the ECJ to define the content of the public policy of a member state, it was none the less required to review the limits within which the courts of those member states might have recourse to that concept for the purpose of refusing recognition to a judgment given in another member state.
In the absence of a fundamental principle in the UK legal order that by recognising or enforcing the judgment concerned could be infringed, there was no justification in refusing to recognise the judgment under article 34(1), on the ground that it could not, as a practical matter, be enforced in the area in which the land was situated. The fact that the claimant might encounter difficulties in having judgments enforced in the northern area could not deprive him of their enforceability and did not preclude the courts of the member state in which enforcement was sought from declaring such judgments enforceable. Furthermore, it was clear from the wording of articles 34(2) and 45(1) of the regulation that the recognition or enforcement of a default judgment could not be refused where a defendant had been able to commence proceedings to challenge the default judgment and those proceedings allowed it to argue that it had not been served with the document that instituted the proceedings in sufficient time to enable it to arrange a defence.
Thomas Beazley QC and Colin West (instructed by Holman Fenwick and Willan) appeared for the claimant; Cherie Booth QC, Nicholas Green QC, Angela Ward and Bitu Bhalla (instructed by Vahib & Co) appeared for the defendants; P Klerides, acting as agent, David Anderson QC and Marie-Eleni Demetriou, (instructed by the Attorney General of the Republic of Cyprus), appeared for the Cypriot Government; Oliver A Samoni-Rantou, S Khala and G Karipsiadis (acting as agents) appeared for the Greek Government; M Dowgielewicz (acting as agent) appeared for the Polish Government; F Hoffmeister and A M Rouchard (acting as agents) appeared for the European Commission.
Eileen O’Grady, barrister
