Jurisdictional Issues and the Foreign Judgments Act

It is easy for Australian companies to enter into agreements with overseas entities, however, if things go awry and the parties end up in dispute then things can get complicated. It can be helpful to understand how to enforce a foreign judgment if your business operations cross international borders. One way this can be achieved is by registering and enforcing a judgment under the Foreign Judgments Act 1991 (Cth) (“FJA”).

Traditionally foreign judgments were enforceable at common law or pleaded in a new proceeding, however it is now possible to register and enforce an overseas judgment under part 2 of the FJA. The process under the FJA is simpler and more certain than enforcing judgments at common law and avoids the parties having to initiate new proceedings in Australia. However, there are a few things you should keep in mind.

Importantly the FJA only applies to certain countries. A list of these countries and their courts can be found in the Foreign Judgment Regulations 1992 (Cth) (FJR). For a judgment to be recognised by the FJA it must have come from a superior court of that country or from an inferior court that is specifically listed in the regulations. It names many countries including New Zealand, France and Germany however not all countries that you may deal with are covered. For example, despite Australia’s close relations with the United States of America (US) and China, both countries are not listed and therefore a judgment from a US or Chinese Court will not be enforceable under the FJA. The FJA also requires that the judgment be a final and conclusive money judgment.

If the judgment you wish to enforce does not fall under the FJA, it may still be enforceable under principles of common law. Another option parties can consider is international arbitration. Australia is party to the New York Convention which allows for enforcement of arbitral awards.

If you have any questions about enforcing foreign judgments in Australia, please feel free to get in contact with one of our experienced commercial lawyers at Frank Law on (02) 9688 6023.

If you have further questions, please contact us at frank@franklaw.com.au.

This is not legal advice.