Schefenacker v Horvat

A judgment creditor may use CPR Part 71 to obtain information from a debtor in aid of enforcing a foreign judgment which is recognised and enforceable in England. The fact that the procedure is anterior to enforcement does not prevent it from being an ancillary part of the enforcement regime. The High Court has jurisdiction where the foreign judgment is to be enforced in England, notwithstanding the wording of CPR 71.2(2)(b), which otherwise identifies the court that made the judgment. An application may be made without notice. A judgment creditor is not precluded from pursuing this procedure merely because a statutory demand has also been served.

The claimant held an enforceable judgment obtained in Germany against the defendant. The judgment had been upheld by the Regional Court of Berlin, which had issued a certificate of enforceability. The claimant obtained an order under CPR Part 71 requiring the defendant to attend court for examination as to his means.

The defendant applied to set aside the order, arguing that the High Court lacked jurisdiction, that the without-notice application involved material non-disclosure, and that the procedure was inappropriate after service of a statutory demand. The central issue was the relationship between CPR Part 71 and the recast Judgments Regulation.

1. Application dismissed. The High Court had jurisdiction to make an order under CPR Part 71 in relation to a foreign judgment.
2. CPR Part 71 is anterior to the actual enforcement of a judgment, as explained in Sucden Financial Limited v Fluxo-Cane Overseas Limited [2009] EWHC 3555. That description did not prevent the procedure from being used in aid of enforcement. CPR 70.1 treats Part 71 as part of the rules concerning enforcement, and it would be anomalous if a foreign judgment creditor could use direct enforcement processes but not ancillary procedures for obtaining information.
3. The German judgment fell within article 2 of the recast Regulation. Articles 36 and 39 provided for recognition and enforcement without a further declaration of enforceability, and article 24(5) conferred exclusive jurisdiction on the courts of the Member State in which the judgment was to be enforced. The expression courts included the High Court. CPR 71.2(2)(b) therefore could not be read as excluding the High Court from making an order concerning a foreign judgment to be enforced in England.
4. Masri v Consolidated Contractors International (UK) Ltd [2008] EWCA Civ 876; [2009] UKHL 43; [2010] AC 90 demonstrated that Part 71 could be invoked in connection with a foreign judgment. The failure in that case resulted from the proposed examination of company officers outside the jurisdiction. The present defendant lived in London.
5. The application could properly have been made without notice. Any prejudice caused by the original order having been made without notice had been remedied by the subsequent hearing, and none was identified. There was also no reason why the claimant could not pursue Part 71 after serving a statutory demand.

The judgment was a first-instance decision on an application to set aside an order made by Insolvency and Companies Court Judge Barber on 6 June 2019 requiring the defendant to attend court for examination under CPR Part 71.