Midtown Acquisitions LP v Essar Global Fund Ltd

Summary judgment is appropriate where the defendant has no realistic prospect of success and there is no other compelling reason for trial. The court must avoid a mini-trial, but may analyse evidence and determine suitable legal or construction issues. A foreign judgment that is final and conclusive is enforceable subject only to the recognised defences of fraud, public policy and denial of natural justice. The enforcing court should not investigate issues that could have been raised before the foreign court. Separate judgments for separate debts do not create an abuse of process merely because enforcement may relate to one commercial transaction. A stay of execution is discretionary and was refused where the debtor had delayed pursuing available foreign challenges.

Midtown sought summary judgment under CPR 24.2 to enforce in England a New York judgment for US$409,220,240.51 arising from an equity contribution agreement. Essar had separately guaranteed related liabilities and had entered confession judgments in New York. It challenged the equity contribution judgment in a pending plenary action and argued that enforcement should be refused or stayed because of possible double recovery, abuse of process, the construction of a New York stay order, and questions concerning Midtown’s authority to sue.

Essar also sought a case-management stay of execution pending its New York challenges. The central issues were whether Essar had a realistic prospect of defending recognition and enforcement, whether there was another compelling reason for trial, and whether the New York stay order extended to enforcement of the equity contribution judgment.

1. Summary judgment. Applying the principles summarised in JSC VTB Bank v Skurikhin [2014] EWHC 271 (Comm), the court considered whether Essar had a realistic, rather than fanciful, prospect of success and whether any compelling reason required a trial. The court could determine suitable questions of law and construction without conducting a mini-trial.
2. Recognition and enforcement. A foreign judgment had to be for a debt or definite sum and final and conclusive on the merits. The available objections were fraud, public policy and natural justice. The New York judgment remained enforceable despite the unpursued appeal and pending plenary action. Essar could not use the English enforcement proceedings to raise New York-law arguments which could have been pursued in New York. The confession-judgment procedure did not itself offend English public policy or natural justice.
3. Double recovery and abuse of process. Enforcement of the equity contribution judgment did not require double recovery. The guarantee and equity contribution judgments concerned separate underlying debts, and no payment had been made under the guarantee judgment. The existence of two judgments and Midtown’s choice of enforcement order did not establish abuse under Henderson v Henderson (1843) 3 Hare 100, as explained in Barrow v Bankside Members Agency Ltd [1996] 1 WLR 257.
4. Stay order. The words staying proceedings in “this action” referred to the plenary action. The order did not extend to enforcement of the equity contribution judgment, and Essar had no realistic prospect of establishing otherwise at trial.
5. Outcome. The summary judgment application succeeded. The case-management stay was refused because Essar had failed to pursue its original appeal, had not sought a stay or posted a bond, and had delayed enforcement of an unpaid judgment.