The role of the reciprocity requirement in the harmonization of standards for the recognition and enforcement of foreign judgments

II - The Subsistence of the Negative Impact of the Reciprocity Requirement Shows the Unsuitability of the Notion in the Field of the Recognition and Enforcement of Foreign Judgments

Despite the fact that the ALI deserves credit for trying to solve the problem related to the application of the reciprocity requirement, the notion seems to cripple any attempt to frame it. The only explanation that can be given is that the notion of reciprocity is simply unwelcome in the landscape of the recognition and enforcement of foreign judgments.

By framing the application of the reciprocity requirement, the drafters of the proposed federal statute thought that the problem of its negative effects would be solved. At first, placing the burden of proof on the judgment debtor will not solve the problem of the proof of the reciprocity requirement, nor to limit the costs and expenses that the proof would require, even by providing the method of proofs. With this respect, the burden of proof will be shifted to the judgment creditors when the judgment debtor succeeds to present document in favour of his claim. Such a situation will lead to a «battle of experts». One scholar wrote «Given that the burden is on judgment creditors to establish satisfaction of the reciprocity requirement, they are likely to put forward a number of expert witnesses in the hopes of avoiding relitigation. Reciprocally, the judgment debtor, coveting the opportunity to retry the dispute, will counter the judgment creditor's argument with his own series of experts. A battle of the experts ensues, with foreign law experts on both sides, thus increasing the size of the litigation and the transaction costs for all affected--parties and courts alike^398(*)». With this respect one commentator argued that «reciprocity costs more than it is worth»^399(*).

This situation flips the problem of proof of the reciprocity requirement. What should be shown to ascertain the lack or the existence of reciprocity? Is it sufficient to show that there is a substantial doubt that the foreign court would grant recognition or enforcement to judgments rendered in the United States? How can the American courts establish such lack of reciprocity? Will a statute be sufficient to ascertain the existence of reciprocity? These difficulties come basically from the vagueness and unclearness of reciprocity. Recall the question of Tunisia where, on the one hand, recognition is granted automatically to foreign judgments. On the other hand, the law in Tunisia includes a reciprocity requirement despite its liberal judgments enforcement standards and most of Tunisian scholars agree that reciprocity do not have that important role since it is not automatically applied by Tunisian courts^400(*). How can American courts solve this problem? Will they consider Tunisia as a reciprocal country?

In addition, besides harming the judgment creditor who succeeded to gain cause of action in a foreign country and who will not be able to collect the amount of his claim if he fails to show reciprocal treatment of foreign countries, the reciprocity requirement harms also a defendant who successfully litigated in a foreign country and he cannot protect himself from the abuses of the disappointing plaintiff who will try to find another forum where he can relitigate anew^401(*). With the new reciprocity rule, that defendant cannot rely on the foreign judgments because he will have to prove that foreign courts will recognize American judgments in similar situation. In this context, the defendant is not the person who is trying to block the foreign judgment, but he is the party in the claim who is willing to rely on the foreign judgment to stop retrying the case again.

The federal statute is silent in this point and does not provide any solution. This is due to the fact that reciprocity in the proposed federal statute operates as an affirmative defence. What credit would American courts give to a judgment which is used passively to stop new proceeding which is in relation with the foreign judgment? The answer is not clear. However, an interpretation of the word «the party resisting recognition or enforcement» can be done, since it can include both plaintiffs and defendants.

Moreover, the reciprocity requirement, as included in the proposed federal statute can be described as a «blind reciprocity requirement that fails to distinguish between alien and domestic judgment creditors, and thus punish their own citizens for defect of foreign law»^402(*). It fails to protect litigants from the unfairness and injustice of the application of the reciprocity requirement especially when those litigants are Americans who succeeded their action abroad.

Finally, the new proposal may have a negative impact on the international trade, and the recognition and enforcement. This negative impact may not be avoided since the proposed reciprocity aims to push foreign countries to accept the unique concepts of American judgments recognition law. The message that the ALI wants to convey through the proposed federal statute is that foreign countries have to accept American judgments as they are i.e. incompatible with foreign legal systems. If they fail to recognize those American judgments rendered on exorbitant bases or jurisdiction or granting huge non-compensatory amount, their judgments will not be recognize in the United States. As one commentator argued that «given the tit-for-tat nature of the global order, inclusion of a reciprocity provision in federal legislation may lead to retaliatory narrowing of the scope of U.S. judgments currently recognized»^403(*)

All of these arguments mandate that reciprocity is an unwelcome concept in the field of the recognition and enforcement of foreign judgments. ^404(*)

* ³⁹⁸. Katherine R. Miller, Playground Politics: Assessing the Wisdom of Writing a Reciprocity Requirement into U.S International Recognition and Enforcement Law, Georgetown Journal of International Law, winter 2004, p. 315 available at www.westlaw.com

* ³⁹⁹. William G. Southard, The Reciprocity Rule and Enforcement of Foreign Judgments, Columbia Journal of Transnational Law, 16:327, 1977, p. 355 available at www.heinonline.com

* ⁴⁰⁰. Imed Bejaoui, La Règle De Réciprocité Dans Le Code Tunisien de Droit International Privé, Mémoire Pour l'Obtention du Mastère en Droit des Affaires, FSJPST, 2005-2006, p. 23-25

* ⁴⁰¹. Recall the fact of Johnston v. Société Générale Transatlantique, discussed above in the Part II, under the title «Rejecting of the reciprocity requirement by State Courts: Johnston v. Compagnie Générale Transatlantique»

* ⁴⁰². Friedrich K. Juenger, The recognition of Money Judgments in Civil and Commercial Matters, in Selected Essays on the Conflict of Law, 2002, p.314 citing Paul Lagarde, La Réciprocité en Droit International Privé, Collected Courses of The Hague Academy of Private International Law, Tome 154 of the Collection, 1977 p. 142 and 195 giving the example of a court decision from the Tunisian Supreme Court «La Court de Cassation» of February 1, 1968.

* ⁴⁰³. Katherine R. Miller, Playground Politics: Assessing the Wisdom of Writing a Reciprocity Requirement into U.S International Recognition and Enforcement Law, Georgetown Journal of International Law, winter 2004, p. 315 available at www.westlaw.com

* ⁴⁰⁴. It is important to point out in this context that these are not the only arguments against the reciprocity, a huge number of pages were written with this concern, but I tried to choose the most valuable one that shows the unsuitability of the proposed reciprocity requirement in the landscape of the recognition and enforcement of foreign judgments