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

Paragraph B - The Role of the Negative Reciprocity in the Harmonization of Standards for the Recognition and Enforcement of Foreign Judgments

It has been argued that the reciprocity requirement is far from being a factor leading to the harmonization of the solution of the private international law because it leads states to align themselves with the less generous solution of the recognition and enforcement of foreign judgments.^108(*) In effect, the reciprocity requirement has nothing to do with the regularity of a foreign judgment; «it does not filter judgments based on fraud, protect parties from abuses of repeat litigation, or prevent enforcement of foreign judgments decided under unjust foreign laws. To the contrary, reciprocity can require that a perfectly valid foreign judgment between individuals be thrown out» and be refused recognition and enforcement only because the foreign rendering court refused to give effect to judgments emanating from the enforcing court^109(*). Such a practice leads to the prevention of universal judgment recognition by creating stalemates between countries with reciprocity provisions^110(*).

Consequently, two countries with a negative reciprocity requirement will refrain from giving effect to judgments rendered in their respective courts unless they have the guarantee that the other would do the same. In order to start having effect, one of countries must start. However, the general opinion is that the application of the reciprocity rule as a precondition for the recognition and enforcement of foreign judgments may lead to retaliation from other countries. That is true. The case of Hilton v. Guyot gives the best example concerning this situation.

On the other hand, it was argued also that reciprocity requirement encourages liberal judgment recognition practices among countries and may lead to positive results, and thus, to the harmonization of standards for the recognition and enforcement of foreign judgments.

It is argued that reciprocity provides an incentive for foreign countries to change their policies. Two examples can illustrate this situation:

First, that was the case of France whose rule of procedure did not give effect to foreign judgments. In effect, article 121 of the code Michaut provided that: «Judgments rendered...in foreign kingdoms and sovereignties...shall have no lien or execution in our kingdom...and notwithstanding such judgments, our subjects against whom they have been rendered may contest their rights anew before our judges». After being refused recognition of its judgment by the German court on the basis of reciprocity, the French Cour de Cassation abandoned its practice of subjecting foreign judgments to a révision au fond and the law was changed to allow a liberal practice for the recognition and enforcement of foreign judgments^111(*).

A second example can be given from the United States. California was one of the first states of the United States to abandon reciprocity. In 1907, after German court refused to recognize California judgments against a German insurer, California enacted its Code Civil Procedure in 1915 which overturned the reciprocity requirement. The legislation's purpose was to improve the prospects of enforcing Californian judgments abroad especially in foreign states that have reciprocity rule and that by making it clear that foreign judgments would be recognized in California^112(*). Both examples illustrate how a country, which usually does not honour foreign judgments, changes its attitude because a foreign country reciprocally refuses to give effect to judgments emanating rendered in its courts.

It has been argued also that reciprocity does promote cooperation when it is applied by countries engaged in a series of interaction over time^113(*). Some theories were developed to explain how reciprocity creates incentives to recognize foreign judgments improve their restrictive judgments recognition practices.

Through the Prisoners' Dilemma^114(*), Game Theorists^115(*) argue that recognition and enforcement can be ensured only through the condition of reciprocity^116(*). The key feature of the Prisoners' Dilemma is that the players are faced with the decision to cooperate. However, the players - states - are incapable of cooperating since they do not trust each other. Applying this situation to the recognition and enforcement of foreign judgments, two states will have to choose either to cooperate and give effect to their respective judgments or prefer not to cooperate and refuse the recognition and enforcement of their respective judgments.

According to the Prisoners' Dilemma, even though the logical solution for both countries is to cooperate and give effect to their respective judgments, both countries would choose non-cooperation and refuse to give effect to foreign judgments. Game theorists argue that this situation would not happen if both countries have reciprocity requirements. Reciprocity will be the guarantee or the commitment to cooperation because neither of the two countries would prefer unilateral recognition but would like to get benefit from liberal movement of judgments. Thus, each state would have the possibility to award cooperation by accepting to give effect to foreign judgments, and will have the possibility to punish non-cooperation by refusing the recognition and enforcement of the state which did not enforce the other country's judgments^117(*). The repetition or iteration of the recognition and enforcement of their own judgments for a period of time will represent an incentive for both states to cooperate instead of defecting^118(*).

Unilateral commitment to recognizing foreign judgments based on comity does not represent a real commitment to enforce foreign judgments; states can change their policy in accordance with their interests. However, negative reciprocity may prevent such scenario. In addition, with most of the states have long lists of hurdles that a foreign judgment has jump, reciprocity can limit the application of what is considered restrictive conditions. In fact, due to the differences between legal systems, one country can use wide concepts like public policy to refuse the recognition and enforcement of foreign judgments. Countries having negative reciprocity in their law may immediately reciprocate; countries having positive reciprocity may become disappointed and retaliate. For these reasons, the best solution was to organise the application of reciprocity through formal reciprocal agreements.

However, despite the fact that reciprocity may help liberalize judgments recognition, its negative impact on litigants and international commerce hardly justifies its existence in the recognition and enforcement field^119(*). Some scholars have argued that «it seems to be unfair to penalize private litigants, who are neither to blame nor in a position to change matters, for the rendition state's lack of comity»^120(*).

Consequently, in order to avoid such situation along with enhancing cooperation, a minimum level of harmony between states is necessary. If this minimum level is lacking, states would find in reciprocity the line of either create incentives to cooperate or to threat or attack non-cooperation.

* ¹⁰⁸. Sami Bostanji, La Notion de La Réciprocité dans les Relations Privées Internationales (Réflexions à la Lumière du Nouveau Code Tunisien de Droit International Privé , Le Code Tunisien de Droit International Privé, Deux ans Après, 2003, p. 90

* ¹⁰⁹. Louisa B. Childs, Shaky Foundations: Criticism of Reciprocity and the Distinction Between Public and Private International Law, International Law and Politics, Vol. 38:221, 2006, p. 224

* ¹¹⁰. Id, p. 227

* ¹¹¹. Friedrich Juenger, The Recognition of Money Judgements In Civil and Commercial Matters, Selected Essays on the Conflict of Laws, p. 290

* ¹¹².Gary B. Born, International Civil Litigation in US Courts, 3rd edition 1996, p954

* ¹¹³. Louisa B. Childs, Shaky Foundations: Criticism of Reciprocity and the Distinction Between Public and Private International Law, International Law and Politics, Vol. 38:221, 2006, p. 224

* ¹¹⁴. Prisoners' Dilemma is a hypothetical situation used to illustrate strategic decision-making. In Prisoners' Dilemma two criminals are arrested and kept apart. Each is told that if neither confesses, the police have enough evidence to send them to jail. By cooperating and not informing on each other, the criminals avoid extended sentences. If one chooses not to confess but the other confesses, the non-confessing criminal will encounter the maximum sentence, and the confessing party will have the minimum sentence. If both confess they will have medium sentence.

* ¹¹⁵. Game theory studies strategic interactions between agents. In strategic games, agents choose strategies which will maximize their return, given the strategies the other agents choose. The essential feature is that it provides a formal modeling approach to social situations in which decision makers interact with other agents. At www.wikipedia.com

* ¹¹⁶. Antonio F. Perez, The International Recognition of Judgments: The Debate Between Private and Public Law Solutions, Berkley Journal of International Law, 2001 at www.westlaw.com.

* ¹¹⁷. Antonio F. Perez, The International Recognition of Judgments: The Debate Between Private and Public Law Solutions, Berkley Journal of International Law, 2001 at www.westlaw.com.

* ¹¹⁸. Michael Whincop, The Recognition Scene: Game Theoretic in the Recognition of Foreign Judgments, at www.austlii.edu.au/au/journals/MULR/1999/17.html

* ¹¹⁹. Paul Lagarde, La Réciprocité en Droit International Privé, Collected courses of Private International Law, 1977, Tome 154 of the Collection, p. 146

* ¹²⁰. Friedrich Juenger, The Recognition of Money Judgements In Civil and Commercial Matters, Selected Essays on the Conflict of Laws, p. 314