Jersey: Opening The Door To Enforcing Nonmonetary Judgments

Brunei and Bandone v Fidelis and Others [2008] JRC152.

Introduction

The common law restriction on enforcing nonmoney judgments (Rule 35(1) of Dicey Morris & Collins) ("Dicey") has been amended in Jersey. The Courts now have a discretion to enforce non-monetary judgments (such as orders for specific performance), which are vital to effective modern day remedies. In doing so, the Jersey Courts have adopted the approach taken in the Canadian and Caymanian Courts.

Facts

In February 2000, the Brunei Investment Agency (the "BIA") and the Government of Brunei Darussalam brought proceedings against Prince Jefri in the High Court of Brunei Darussalam alleging that Prince Jefri had misappropriated over US $15 billion of State funds whilst acting as Minister of Finance for Brunei Darussalam. In May 2000 the proceedings were compromised.

Under the Settlement Agreement Prince Jefri was required to return to the BIA all assets acquired with those misappropriated funds. While some assets were returned in 2000 and 2001, Prince Jefri failed to transfer the remaining assets, which included shares in two Jersey companies. In 2004 the BIA applied to the Brunei High Court for summary enforcement of the Settlement Agreement.

The Brunei High Court ordered Prince Jefri to transfer the shares in the Jersey companies (amongst other assets) to the BIA (the "Brunei Judgment").

Prince Jefri appealed unsuccessfully to the Privy Council in 2007.

The Jersey Application

The BIA, represented by Ogier's Kerry Lawrence, applied to Jersey's Royal Court to enforce the transfer of shares. The BIA argued that, pursuant to principles of comity, the Jersey Courts should recognise the judgment of the Brunei Court as binding upon Prince Jefri and in doing so enforce the terms of the Settlement Agreement. The BIA argued that having won its case in Brunei it should not have to re-litigate the merits in Jersey.

Prince Jefri argued that the Court could not rely on comity, that there was no statutory remedy and no residual jurisdiction to enforce foreign non-money judgments under common law principles, as Jersey should follow the English common law rule set out in Dicey which restricts enforcement of foreign judgments to those for a definite sum of money.

Rule 35(1) of Dicey states that "for a claim to be brought to enforce a foreign judgment, the judgment must be for a definite sum of money, which expression includes a final order for costs... if, however, the judgment orders him to do anything else, e.g. specifically perform a contract, it will not support an action, though it may be res judicata."

The Judgment

The Court concluded that it should make its decision within the parameters of Rule 35(1), either following the Rule or amending it insofar as it applied in Jersey.

Rule 35(1) is derived from the two hundred year old case of Sadlar v. Robins. The Court noted that the world has changed a great deal since then, and that modern day international commerce and banking require effective, modern remedies which, in respect of enforcement of foreign judgments, go beyond simple monetary judgments.

The restrictions imposed by Rule 35(1) have recently been considered by the Supreme Court of Canada (in Pro-Swing v. Elta (2006)) and the Grand Court of the Cayman Islands (in Miller v. Gianne (2007)). Both the Canadian and the Cayman Courts decided that modern practice required that Rule 35(1) be amended to allow enforcement of non-money judgements in appropriate cases, subject to a cautious, discretion based judicial approach The Jersey Court concluded that this approach, was more suited to Jersey's needs in the 21st century, and drew some comfort from the Isle of Man Privy Council decision of Pattni v. Ali, which envisaged direct enforcement of in personam declaratory judgments concerning contractual rights.

Applying this new, more liberal interpretation of Rule 35 to the facts, the Jersey Court found that the BIA should be entitled to specifically enforce the terms of the Settlement Agreement, as determined by the Brunei Court, without having to relitigate the merits. The fact that the Brunei Court had clear jurisdiction and had conclusively determined the BIA's entitlement to the property, the absence of any substantive argument on the merits open to Prince Jefri, and the fact that the enforcement mechanism was clear and straightforward all helped to influence the Jersey Court to exercise its discretion in the BIA's favour. Prince Jefri's nominees were ordered to transfer the shares in the assets back to the BIA.

Comment

This is a significant and progressive judgment which enables the Jersey judiciary to deal with clear cut non-monetary judgments, efficiently and quickly. Doubtless the BIA would have obtained its order had it been forced to argue the merits again, but at significant expense and after necessary delay. Query how long Rule 35(1) will survive in other jurisdictions?

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