Consolidated Contractors International Company SAL v Mr Munib Masri (Bermuda)

For a foreign judgment registered for enforcement, an allegation that jurisdiction was obtained by fraud requires a properly arguable case that the alleged deception was deliberate or reckless and materially caused the jurisdictional decision. The inquiry is objective: a claimant’s asserted belief is irrelevant if the jurisdictional court did not rely on it. A later failure of the jurisdictional case at trial does not, without more, establish fraud. An appellate court may also strike out an appeal as an abuse where a judgment debtor is a proven contemnor, has frustrated enforcement, and shows no real intention to comply if the appeal fails.

English High Court judgments against CCIC and CCOG were certified for enforcement abroad under section 10 of the Administration of Justice Act 1920. The liability judgment was given in the English proceedings on 28 July 2006: [2006] EWHC 1931 (Comm). The judgments were registered in Bermuda, and CCIC applied to set aside registration under section 4(1) of the Judgments (Reciprocal Enforcement) Act 1958, alleging that jurisdiction had been obtained by fraud. A further application was made under rule 12 of the Judgments (Reciprocal Enforcement) Rules 1976.

Kawaley J dismissed the application. The Court of Appeal of Bermuda dismissed CCIC’s appeal. The Privy Council considered whether there was a properly arguable fraud case and whether CCIC’s conduct in resisting enforcement made the present appeal abusive.

The Committee struck out CCIC’s appeal as an abuse of process.

1. Fraud and registration. The Committee assumed, without deciding, that fraud which caused a court wrongly to accept jurisdiction could fall within the statutory ground that a judgment was obtained by fraud under section 4(1) of the Judgments (Reciprocal Enforcement) Act 1958. The supplementary rule 12 ground was not determined.
2. Prima facie case. The applicant had to show an arguable case that the alleged deception was deliberate or reckless and was material to the jurisdictional decision. Findings made at a later trial on the objective identity of the contracting party did not themselves establish that evidence given at the jurisdiction stage was fraudulent. It was a strong step to derive even a prima facie fraud case from reasoning not directed to fraud (paras [11]-[15]).
3. Causation. Causation had to be assessed objectively by examining the hearings and decisions by which jurisdiction was established. Assuming for present purposes that article 5(1) of the Council Regulation (EC) No 44/2001 did not apply, the alleged lies had to have caused jurisdiction under article 6(1). The respondent’s asserted belief that CCUK was a contracting party, and his knowledge concerning CCIC’s interest, were irrelevant to the ultimate jurisdictional decisions. No properly arguable causal case therefore existed (paras [16]-[19]).
4. Abuse of appellate process. The principle recognised in X Ltd v Morgan-Grampian (Publishers) Ltd [1991] 1 AC 1 remained relevant although the established contempts concerned enforcement of the English judgments rather than the Bermudian registration. CCIC had been found in contempt, had hampered enforcement, and had no real intention of complying with the Bermudian judgments if the appeal failed. Those circumstances independently justified striking out the appeal (paras [22]-[28]).

• Privy Council. The Committee struck out the appeal as an abuse of process: [2011] UKPC 29.
• Court of Appeal of Bermuda. Evans J dismissed CCIC’s appeal from the decision of Kawaley J.
• High Court of Bermuda. Kawaley J dismissed CCIC’s application to set aside registration of the English judgments.