October 30, 2012 - The UK Supreme Court has released a decision that significantly impacts cross-border insolvency proceedings: Rubin v. Eurofinance SA and New Cap Reinsurance Corporation v. A E Grant [2012] UKSC 46.

In Capital One v. Solehdin,1 the Ontario Superior Court of Justice recognized judgments of a Louisiana bankruptcy court and held that they were enforceable in Ontario. The judgments were summary judgments against guarantors under their respective guarantees. The decision is significant – it is one of the first cases where guarantors challenged the recognition and enforcement of such judgments of a foreign bankruptcy court on the basis that the foreign bankruptcy court lacked the jurisdiction to grant the judgments.

Swiss Civil Procedure Law in a Nutshell (Volume 11 of 12)

This blog series provides litigators and corporate counsel from other jurisdictions with a practical understanding of the mechanics, advantages, and limits of litigation before State Courts in Switzerland.

Enforcement of Money Claims

Money claims are enforced by virtue of the Debt Enforcement and Bankruptcy Law. The creditor may either initiate enforcement by virtue of an ex parte freezing order (attachment) or else by a normal summons to pay.

In Rubin v Eurofinance SA and New Cap Reinsurance Corporation (in liquidation) and another v AE Grant and others [2012] UKSC 46, the UK Supreme Court held that:  

If you’re pursuing assets in England relevant to a non-European bankruptcy or insolvency, you can’t rely on a (default) foreign judgment and must instead bring fresh proceedings in the English courts

Important clarification was provided today to the insolvency world as the UK Supreme Court in the conjoined appeals in Rubin and New Cap rejected the modified universalist doctrine that established common law rules as to the enforcement of foreign judgments do not (or should not) apply to insolvency orders.

The UK Supreme Court has handed down an important judgment in the conjoined cases of Rubin and another v Eurofinance SA and others and New Cap Reinsurance Corporation (in Liquidation) and another v AE Grant and others [2012] UKSC 46, which provides vital clarification on the effect of foreign insolvency judgments on the UK courts. The judgment was handed down yesterday.

Background & Court of Appeal

In New Cap Reinsurance Corporation Ltd & Anr v AE Grant & Ors, the Court of Appeal has upheld a first instance decision that section 426 of the Insolvency Act (IA) can be used to enforce a foreign monetary judgment in insolvency proceedings. However, the Court acknowledged that where there exists a statutory framework for the enforcement of foreign judgments, in this case enforcement pursuant to the Foreign Judgments (Reciprocal Enforcement) Act 1933 (the 1933 Act), then enforcement under s.426 of the IA must follow the requirements of the 1933 Act.

The Court of Appeal1 has ruled that foreign judgments in insolvency proceedings may be enforced by the English courts at common law, and that the ordinary principles which may prevent the enforcement of foreign judgments do not apply to insolvency judgments where the action from which the foreign judgment arises is integral to the collective nature of the insolvency proceedings.

Facts

There have been a number of recent English Court judgments of interest in the corporate field and this corporate update reports on cases relevant in relation to warranties and representations in M&A transactions, restrictive covenants in acquisition agreements, the enforcement of foreign judgments in cross-border insolvency proceedings and the piercing of the corporate veil.

WARRANTIES OR REPRESENTATIONS? - Ensuring clarity of intention when drafting acquisition agreements