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English Courts Could Render Unenforceable Contracts Enforceable


The recent Invest Bank PSC v El-Husseini case clarifies that foreign judgments, even if unenforceable in their home country, might still be enforced in England.

What happened in this case?

Invest Bank (the Bank) had won two money-related cases against El-Husseini (the Guarantor) in Abu Dhabi (the Abu Dhabi Judgments). After the Abu Dhabi ruling, the Bank took legal action in England in July 2021 to collect the debt from the Guarantor, leading to a default judgment in favor of the Bank in January 2023.

However, Abu Dhabi enacted "Article 121b," making it hard to enforce these judgments in their own jurisdiction, essentially protecting borrowers from various measures, such as asset seizure and travel bans. The Guarantor argued that since the Abu Dhabi Judgments weren't enforceable in the UAE anymore, the English default judgments should be set aside.

What did the court decide?

The court ruled that the Abu Dhabi Judgments could still be enforced in England, even if they weren't enforceable in the UAE anymore. The judge pointed out that English common law doesn't prohibit enforcing foreign judgments just because they can't be enforced in their home country.

The key was that the Abu Dhabi Judgments remained final and conclusive, even if they faced issues in their home jurisdiction.

This case showed that when dealing with the enforceability of foreign judgments in England, parties should consider the common law position. Problems with enforcing a judgment in its home country don't necessarily affect its status or impact under English common law. This decision could be helpful for parties trying to enforce judgments in England, especially when the defendants have assets there.


Contacts

If you require assistance in relation to the above and/or would like to discuss anything further, please do not hesitate to contact info@act.london or your usual A.C.T. contact.

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