Question Presented
We have been asked
to opine on whether there are reciprocal enforcement agreements between
Pakistan and England under Pakistani law; and how difficult enforcement of a
monetary/costs judgment in Pakistan is in light of the processes that need to
be undertaken. The background, briefly, is that our partner law firm in United
Kingdom is acting for a defendant in a litigation and intends to apply for an
order for security against costs presumably under 25.13 of the Rules and
Practice directions of the Civil Procedure Rules in the United Kingdom.
Short Answer
Under Pakistani
law, Section 44-A of the Code of Civil Procedure 1908 (the “CPC”) caters
specifically to the question of judgments passed by “superior courts” in
reciprocating states and especially the United Kingdom (which reciprocates
through Foreign Judgments Reciprocal Enforcement Act 1933). Section 44-A of the
CPC however is subject to Section 13 of the CPC which sets out the broad exceptions
to such enforcement. This makes the execution process cumbersome and time
consuming. Case law also has ousted the operation of Order XXI Rule 23-A of the
CPC which provided for decretal amount to be deposited as security for filing
of objections against such execution. It
may also be stated that Pakistan is not a signatory to any of the conventions
specifically mentioned under 25.13 of the Civil Procedure Rules, Rules and
Practice Directions in the United Kingdom.
Discussion
At the outset it
must be stated the aforesaid Section 44-A of the CPC defines “Superior Court”
in reference to United Kingdom as “High Court in England, Court of Sessions in
Scotland, High Court in Northern
Ireland, the Court of Chancery of County Palatine of Lancaster and the Court of
Chancery of County Palatine of Durham.”
Therefore if the litigation referred to the question pertains to a lower
court in England, there is no reciprocal enforcement. This memorandum assumes that the said
litigation is taking place in the High Court of England or the Courts of
Chancery as aforesaid (the question refers to England and not United
Kingdom).
Section 44-A of
the CPC has been described as a self-contained and independent provision with
the Honourable Sindh High Court in the case of Abdul Malik Badruddin v. Grosvenor Casino Limited PLD 1993
Karachi 449 (hereinafter the “Grosvenor Case”) stating that the procedure
of the execution is contained in sub-sections (2) and (3) of the said
provision. Therefore in Grosvenor Case, the Honourable Sindh High Court ruled
that provision of Order XXI Rule 23-A does not apply to foreign judgments. Order XXI Rule 23-A provides for the deposit
of decretal amount in the event that a judgment debtor seeks to file objections
against execution of a decree. By ousting the operation of this rule in foreign
judgments, the door has been flung open for a judgment debtor to file
objections without having to deposit a judgment amount as security. The
judgment in the Grosvenor Case also held that a foreign judgment or decree does
not operate proprio vigore in
Pakistan and is therefore not capable of automatic execution. This means that
at some point the local “District Court” (which is held to be a court of
original civil jurisdiction) may look at the merits of the judgment.
The objections
that have specifically been allowed by Section 44-A of the CPC are exception or
objections contained in Section 13 (a) through (f) of the CPC. The first objection is that a judgment has not
been pronounced by a court of competent jurisdiction. The second objection is that the judgment has
not been passed on merits. The second objection gives the executing court the
power to determine the facts leading to the foreign judgment de novo. The third objection is that the
judgment was based on an incorrect view of international law or a refusal to
recognize Pakistan’s law in cases in which such law was applicable. Here again,
a question of law is to be determined by the executing court. The fourth
objection is that judgment was obtained as a result of proceedings that were
contrary to principles of natural justice. The fifth objection is that the
judgment was obtained through fraud and the final objection is that the
judgment sustains a claim that breaches a Pakistani law. All of these
objections require judicial application of mind and require the court to call
evidence and try the matter anew. Given that Order XXI Rule 23-A does not
apply, it becomes extremely easy for a judgment debtor to indefinitely delay
and even frustrate the foreign judgment or in this case the UK judgment.
Subsection 3 of Section 44-A of the CPC states clearly that the executing court
may refuse execution if it is satisfied that any of the exceptions or
objections contained in Section 13 of the CPC apply. The execution is also subject
to appeal and as a whole the process may take up to two years or more to
complete, which may be an additional consideration given that the issue at hand
pertains to a judgment on costs.
It may additionally be stated that under
subsection 2 of 25.13 of the Civil Procedure Rules of United Kingdom, an order
for security for costs may be made “if the resident out of the jurisdiction; but not
resident in a Brussels Contracting State, a State bound by the Lugano
Convention, a State bound by the 2005 Hague Convention or a Regulation State,
as defined in section 1(3) of the Civil Jurisdiction and Judgments Act 1982”.
Pakistan is not a signatory or a contracting to any of the aforesaid
conventions.
Conclusion
In view of the foregoing it is clear that despite a
reciprocal enforcement provision under Section 44-A of CPC, the enforcement of
a monetary or a costs judgment in Pakistan is difficult, time consuming and
cumbersome. The execution is to be carried on the original civil side and will
be subject to further delays due to appeals. Additionally Pakistan is not a
signatory to the Hague Convention on Choice of Courts, 2005 and is not a
regulation state as defined by applicable law in the United Kingdom. It is, therefore,
recommended that an application for security under Rule 25.13 as aforesaid may
kindly be made in the said litigation to best secure the interests of the
client.