Recognition and enforcement of foreign judgments in Australia

1.1 The enforcement of foreign judgments in Australia is governed by statutory regimes. Where a statutory regime does not apply, the enforcement of a foreign judgment is governed by common law principles.

Foreign Judgments Act 1991 (Cth)

1.2 The Foreign Judgments Act 1991 (Cth) (“FJA”) and its regulations, the Foreign Judgments Regulations 1992 (Cth) (“FJR”)) is the primary statutory regime governing the enforcement of foreign judgments in Australia. 

1.3 This statutory regime is based on reciprocity of treatment of Australian judgments in the foreign jurisdiction and only applies to judgments from superior or specified inferior courts of specific countries (as set out in the FJR including judgments of the courts of the United Kingdom and certain New Zealand judgments).

1.4 Noteworthy countries not listed in the statutory regime include significant trading partners of Australia, e.g. China and the United States.

1.5 The statutory regime generally extends to “enforceable money judgments” which are defined as including money judgments, an amount of money payable in respect of New Zealand tax; or an amount of money payable in respect of recoverable Papua New Guinea income tax.  1 FJA, s 3  A “money judgment” is defined as a judgment under which money is payable.  2 FJA, s 3.  The FJA also permits registration of non-monetary judgments if the FJR provides for such registration (FJA, s 5(3)). However, the current FJR only permits the registration of monetary judgments.

1.6 For the purposes of the FJA, a judgment means:

1.6.1 A final or interlocutory judgment or order given or made by a court in civil proceedings; or

1.6.2 A judgment or order given or made by a court in criminal proceedings for the payment of a sum of money in respect of compensation or damages to an injured party; or

1.6.3 An award in proceedings on an arbitration conducted in, and under the law applying in a country, that has become enforceable in a court of that country in the same manner as a judgment or order given by that court (there is a carve-out for awards related to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States signed by Australia on 24 March 1975).  3 FJA, s 3

1.7 Under the FJA and the FJR, the judgment creditor must first apply for the registration of the judgment by the relevant Australian court. An application for registration must be made within 6 years of either the date of the judgment, or the date of the last judgment in any appeal proceedings. 4 FJA, s 6(1)  The relevant court will not register the judgment if at the date of application, it has been wholly satisfied or could not be enforced in the country of the original court.  5 FJA, s 6(6)

Trans-Tasman Proceedings Act 2010 (Cth)

1.8 For New Zealand judgments, an additional statutory regime applies pursuant to the Trans-Tasman Proceedings Act 2010 (Cth) (“TTPA”) that aims to streamline the process for recognition and enforcement of judgments in civil proceedings between the two Trans-Tasman countries. 

1.9 Section 66(1) of the TTPA defines the types of “registered New Zealand judgments” that are capable of being enforced in Australia once registered under the TTPA. 6 TTPA, s 65 provides that a registerable NZ judgment cannot be enforced in Australia if it is not registered in an Australian court under section 68 which in turn provides that an Australian court must, on application under section 67, register a registrable NZ judgment in that court.   These include civil proceedings judgments, compensation, damages or reparations ordered in criminal proceedings and a “regulatory regime criminal fine”. There are various “excluded matters” which are expressly not capable of being enforced under the TTPA, e.g. the enforcement of a child support obligation (amongst other matters which are expressly excluded under the TTPA). 7 TTPA, s 66(2)

1.10 An application for registration must be made within 6 years of the day after the judgment or any appeal judgment is given or any longer period that the Australian court considers appropriate. 8 TTPA, s 67(5)

1.11 The type of New Zealand judgment (e.g. a judgment in a civil proceeding other than for civil pecuniary penalties, criminal fines or a NZ market proceedings judgment)  9 TTPA, s67(1)   will dictate the relevant Australian court that a judgment creditor is entitled to apply to register a New Zealand judgment.  10 TTPA, s 67   Once registered, a judgment creditor must give notice of the registration to every liable person within 15 working days of the Australian court after the day of registration or if, before or after that period  upon application by a judgment creditor to the Australian court for a longer period, any longer period the Australian court considers appropriate.  11 TTPA, s 73

Common Law

1.12 If a statutory regime does not apply, the relevant Australian court will apply common law principles to the question of whether a foreign judgment is to be enforced. The judgment creditor can attempt to enforce the foreign judgment by bringing an action to recover the debt owed by the judgment debtor, and/or can commence new proceedings relying on the original cause of action. The judgment creditor must show that:

1.12.1The foreign court has exercised “international” jurisdiction as recognised by the Australian court;

1.12.2 The judgment must be final and conclusive;

1.12.3 The parties must be the same; and

1.12.4 Any judgment must be for a definite liquidated sum of money (though there are exceptions). 

1.13 The judgment creditor can then claim the judgment amount in the Australian court, or /in addition can bring the original cause of action before the Australian court. In that case, the judgment creditor would seek to rely on the foreign judgment to prevent the judgment debtor asserting any new defence not previously raised, other than any limited recognised defences as set out below in paragraph 6.5.

2.1The relevant statutes are:

2.1.1 The FJA;

2.1.2 The FJR;

2.1.3 The Foreign Proceedings (Excess of Jurisdiction) Act 1984 (Cth) (“FPA”); and

2.1.4 The TTPA.

2.2 Australia is also a party to bilateral treaties with the United Kingdom (the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters 1994 which provides for the mutual recognition of civil and commercial judgments for the payment of money other than in respect of taxes or other charges or an order requiring the payment of maintenance) and New Zealand (the Agreement between the Government of Australia and the Government of New Zealand on Trans-Tasman Court Proceedings and Regulatory Enforcement which has been enacted in statute by the TTPA) but is not a party to other key international conventions on the recognition and enforcement of  foreign judgments, e.g. the Hague Convention on Recognition and Enforcement of Foreign Judgments in Civil and Commercial Matters 1971.

2.3 Under the FPA, the Commonwealth Attorney-General has the power to prohibit enforcement in Australia of a foreign judgment obtained in anti-trust proceedings pursuant to the national interest, or if the exercise of power by the foreign court is contrary to international law or inconsistent with international comity or practice.  12 See for example, sections 9 and 14 of the FPA.

3.1 The common law position on the enforcement of foreign judgments in Australia is well established.  Some important precedents are:

• Ainslie v Ainslie (1927) 39 CLR 381 (the general rule is that effect will not be given to a foreign judgment unless it be final and conclusive, though the fact it can be altered, varied or discharged upon fresh evidence does not destroy its effectiveness while it subsists);
• RDCW Diamonds Pty Ltd v. Da Gloria [2006] NSWSC 450 and Xplore Technologies Corporation of America v. Tough Corp Pty Ltd [2008)] NSWSC 1267 (a foreign judgment may be enforced at common law as an action in debt for a liquidated sum); and
• Doe v. Howard [2015] VSC 75 (in which the court summarised the four requirements as set out in paragraph 1.11 above which must be present for a judgment creditor to enforce a foreign judgment at common law).

4.1 No. Under the statutory regime provided a foreign judgment meets the requirements of the FJA (or the TTPA in the case of a New Zealand judgment) it can be registered (analogous to recognition) by the Australian courts. The judgment creditor must simply file an originating application accompanied by a copy of the foreign judgment certified by the original court. Similarly, the common law precedents demonstrate that the relevant Australian court will not review the merits of the case.

5.1 Timelines can vary, but if the foreign judgment is to be registered pursuant to the FJA or TTPA and is uncontested, the registration is typically prompt because the merits of the case are not being reviewed in the registration process.

5.2 While the process of registration is typically prompt, if enforcement is subsequently challenged by a judgment debtor seeking to set aside the registration of the judgment, the time frame for resolving any challenge may depend on the complexity of the issues / grounds in question.  For example, seeking to set aside the registration of a judgment on public policy grounds, while a narrow ground, may involve a detailed examination of the particular facts in question (albeit not being a merits review) and legal principles. Practical matters such as the number of hearing days required and the extent of evidence to be led may require significant preparation time for both parties and may also lead to delays depending on the availability of the court to set down a sufficient period of time in the court’s calendar to hear the matter.

5.3 The same is true of any proceedings brought at common law (i.e. if the enforcement of the common law judgment is challenged then the time frame may be longer, depending upon the complexity of the specific grounds raised by the judgment debtor).  

6.1Yes. Under the FJA, 13 FJA, s 7  a party against whom a registered judgment is enforceable can apply to the court in which the judgment was registered to have it set aside.

6.2  Pursuant to the FJA, the court must set the registration of the judgment aside if it is satisfied that:  14 FJA, s 7 (2)(a)

6.2.1 the judgment is not or has ceased to be a judgment to which the FJA applies;

6.2.2 the judgment was registered for an amount greater than the amount payable under it at the date of registration;

6.2.3 the judgment was registered in contravention of the FJA;

6.2.4 the courts of the country of the original court had no jurisdiction;

6.2.5 if the judgment debtor did not receive notice of the original proceedings in sufficient time to enable the judgment debtor to defend the proceedings and did not appear;

6.2.6 the judgment was obtained by fraud;

6.2.7 the judgment has been reversed on appeal or otherwise set aside in the courts of the country of the original court;

6.2.8 the rights under the judgment are not vested in the person by whom the application for registration was made;

6.2.9 the judgment has been discharged; or

6.2.10 the enforcement of the judgment, not being a judgment under which an amount of money is payable in respect of New Zealand tax, would be contrary to public policy.

6.3 The court may also set aside the registration of the judgment pursuant to the FJA if it is satisfied that the matter in dispute in the proceedings in the original court had before the date of the judgment in the original court been the subject of a final and conclusive judgment by another court having jurisdiction in the matter.  15 FJA, s 7 (2)(b)

6.4 If the judgment was registered under the TTPA, then the registration may be set aside if:  16 TTPA, s 72

6.4.1 the court is satisfied that enforcement of the judgment would be contrary to public policy in Australia;

6.4.2 the judgment was registered in contravention of the TTPA; and

6.4.3 the judgment was given in a proceeding the subject matter of which was immovable property, or was given in a proceeding in rem the subject matter of which was movable property; and that property was, at the time of the proceeding in the original court or tribunal, not situated in New Zealand.

6.5 In proceedings brought under the common law, the judgment debtor cannot raise a defence that was or could have been raised in the original foreign proceedings. There are therefore only four recognised defences available to the judgment debtor in such proceedings, namely that:

6.5.1 the foreign judgment was obtained by fraud;

6.5.2 the foreign judgment is contrary to public policy;

6.5.3 the judgment debtor was denied natural justice in the foreign court; or

6.5.4 the foreign judgment is penal, or for a revenue debt.

7.1 The International Arbitration Act 1974 (“IAA”) gives effect to the United Nations Convention on the Recognition and Enforcement of Arbitration Awards 1958 to which Australia is a signatory, and the UNCITRAL Model Law on International Commercial Arbitration 1995.

7.2 Pursuant to Section 8 of the IAA, a foreign arbitration award may be enforced in a court of a State or Territory or the Federal Court of Australia as if the award were a judgment or order of that court.

8.1 Judicial precedents in relation to the enforcement of international arbitration awards include:

• Hub Street Equipment Pty Ltd v Energy City Qatar Holding Company [2021] FCAFC 110, in which the court held that (i) the arbitral award should not be enforced in Australia because the tribunal was not composed in accordance with the agreement of the parties, and (ii) it was not necessary for the award debtor to seek to set the award aside at the seat of arbitration;
• Neptune Wellness Solutions, Inc v Azpa Pharmaceuticals Pty Ltd [2021] FCA 676, in which the court held that an arbitral award obtained in Canada was a foreign award for the purposes of the IAA and may be enforced as a judgment of the Australian court. The court made its decision despite the non-participation of the respondent;
• TCL Air Conditioner (Zhongshan) Co Ltd v The Judges of the Federal Court of Australia & Anor (2013) HCA 5, in which the court held that an arbitral award made in the exercise of a power of private arbitration does not involve impermissible delegation of federal judicial power, and the court has jurisdiction to determine the enforceability of arbitral awards; and
• Uganda Telecom Ltd v Hi-Tech Telecom Pty Ltd (2011) 277 ALR 415, in which the court held that the IAA act does not permit a party to a foreign arbitral award to resist enforcement of that award on the ground of an error of law.

9.1As with enforcement of foreign judgments under the statutory regimes and common law, it is usually not a lengthy process to enforce a foreign arbitration award, unless the enforcement of the foreign award is challenged. If the enforcement of the foreign award is challenged, time frames can be longer, depending on the complexity of the specific grounds raised by the challenging party.    

10.1 Yes, but only on the very limited grounds which are specifically provided for in sections 8(5) and 8(7) of the IAA, namely where:  17 IAA, s 8(3A), s 8(5) and s 8(7)

10.1.1 a party to the arbitration agreement in pursuance of which the award was made was, under the law applicable to him or her, under some incapacity at the time when the agreement was made;

10.1.2 the arbitration agreement is not valid under the law expressed in the agreement to be applicable to it or, where no law is so expressed to be applicable, under the law of the country where the award was made;

10.1.3 the party brining the challenge was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his or her case in the arbitration proceedings;

10.1.4 the award deals with a difference not contemplated by, or not falling within the terms of, the submission to arbitration, or contains a decision on a matter beyond the scope of the submission to arbitration;

10.1.5 the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, was not in accordance with the law of the country where the arbitration took place;

10.1.6 the award has not yet become binding on the parties to the award or has been set aside or suspended by a competent authority of the country in which, or under the law of which, the award was made;

10.1.7 the subject matter of the difference between the parties to the award is not capable of settlement by arbitration under the laws in force in the State or Territory in which the court is sitting; or

10.1.8 to enforce the award would be contrary to public policy.