Almost 10 years ago, the Supreme Court of California decided on the proper procedure for domesticating foreign-country judgments in California. This decision created the standard for creditors wishing to domesticate and enforce their foreign judgment in California, where the underlying foreign judgment was previously awarded in a country outside the United States. This article explores the process for domesticating and enforcing foreign-country judgments in California, which is separate and unique from sister-state judgments.
Sister-State Judgments v. Foreign-Country Judgments
Article IV, Section 1 of the United States Constitution, the “Full Faith and Credit Clause”, requires each State to grant the same full faith and credit to a judgment obtained in a State other than the State where enforcement is sought. The Uniform Foreign Money-Judgments Recognition Act (“UFMJRA”) was promulgated in 1962 by the Uniform Law Commissioners. It was later adopted by California for the purpose of procedural recognition and enforcement of judgments obtained in countries outside the United States.
Uniform Foreign Money-Judgments Recognition Act
UFMJRA authorizes recognition of any foreign judgment that is final, conclusive and enforceable where rendered even though an appeal therefrom is pending or it is subject to appeal. The Supreme Court of California, in Manco Contracting Co. (W.L.L.) v. Bezdikian, 45 Cal. 4th 192, 195 P.3d 604, 85 Cal. Rptr. 3d 233, 2008 Cal. LEXIS 13045 (Cal. November 17, 2008), set out to determine the meaning of final under UFMJRA; and, whether an appeal in a country where the law states appeal negates finality renders a judgment unrecognizable and unenforceable in California. The Manco court further decided on the proper application of the statute of limitations for creditors wishing to enforce their foreign-country judgments in California.
The former section 1713.2 of the UFMJRA states: “This chapter applies to  any foreign judgment that is final and conclusive and enforceable where rendered  even though an appeal therefrom is pending or it is subject to appeal.” [Former § 1713.2.] California courts have disagreed about the extent to which the second clause undermines the first. [Manco Contracting Co. (W.L.L.) v. Bezdikian, 45 Cal. 4th 192, 198, 195 P.3d 604, 608, 85 Cal. Rptr. 3d 233, 237, 2008 Cal. LEXIS 13045, *9 (Cal. November 17, 2008).] California Code of Civil Procedure §§ 1713.1 – 1713.8 were repealed and placed with California Code of Civil Procedure §§ 1715 – 1725 in 2008. The new UFMJRA still requires that the judgment is final, conclusive, and enforceable. [California Code of Civil Procedure § 1715.] It is now well settled that all requirements are interrelated and each requirement must be met before a foreign-country judgment can be domesticated and enforced in California.
The first requirement of UFMJRA is that the judgment be final. A judgment is final when it is not subject to additional proceedings in the rendering court (emphasis added) other than execution. [id., 45 Cal. 4th 192, 214, (Cal. November 17, 2008).] Since finality concerns the rendering court, California interprets the rendering court as, ordinarily, the trial court. Thus, while a judgment may be subject to appeal by an appellate court, such appealability does not eviscerate the finality of the foreign-country judgment.
Second, it must be determined that the foreign-country judgment is conclusive. Section 1713.4 of UFMJRA states that a foreign judgment “is not conclusive” if it was rendered under a system without impartial tribunals or procedures compatible with due process, or if the foreign court lacked personal or subject matter jurisdiction. (Former § 1713.4, subd. (a)(1)–(3).) [id. 45 Cal. 4th 192, 200.] Similar to the former § 17.13.4, California Code of Civil Procedure § 1717 also includes due process and jurisdiction requirements. The conclusive nature of the foreign-country judgment requires an inquiry to the court that rendered the judgment and the procedural laws intended to give the judgment debtor notice and an opportunity to be heard. This requires careful analysis by a lawyer to determine whether the procedural rules in the foreign country have substantially similar due process rules. Equally important is the foreign-country court’s jurisdiction over the judgment debtor.
Lastly, a foreign-country judgment will not be recognized as enforceable if the time for enforcement expired. California’s legislature intended foreign-country judgments to be enforceable in the same manner as sister state judgments. [id., 45 Cal. 4th 192, 209.] Based on the directive of section 1713.3 that foreign judgments be enforced in the same manner as sister state judgments, the Manco court concluded that the 10-year statute of limitations applicable to actions upon sister state judgments (§ 337.5) also applies to actions upon foreign judgments. [Manco Contracting Co. (W.L.L.) v. Bezdikian, 45 Cal. 4th 192, 208, 195 P.3d 604, 615, 85 Cal. Rptr. 3d 233, 245, 2008 Cal. LEXIS 13045, *34 (Cal. November 17, 2008).] In accordance with the Manco decision, the new Code of Civil Procedure states, an action to recognize a foreign-country judgment shall be commenced within the earlier of the time during which the foreign-country judgment is effective in the foreign country or 10 years from the date that the foreign-country judgment became effective in the foreign country. [Cal. Code Civ. Proc. § 1721.]
Thus, California courts must recognize a foreign judgment, regardless of whether it has been appealed or is subject to appeal, so long as the judgment is final, conclusive, and enforceable in the country where it was rendered. The time limitation for enforcement of a foreign-country judgment is similar to the 10-year limitations period of sister-state judgments. [Cal. Code Civ. Proc. § 337.5.]
Disclaimer: This article does not create a legal relationship, nor is it intended to be legal advice. Consult a lawyer for legal advice. Inquiries do not create a legal relationship.