RIX LJ: [1] On 9 February 1999 Mr J., the appellant in this court, was
served at his home in England with proceedings issued in the regional
court of Neubrandenburg (Zivilkammer des Landgerichts) in Germany
by T. GmbH. Mr J. failed to enter an appearance within the two weeks
allowed for doing so, and as a result judgment in default of appearance
for DM 520,000 plus interest was issued by the regional court on 16
March 1999, just short of five weeks after service.
[2] In the present proceedings in England T. seeks registration of that
default judgment pursuant to Title III of the Convention on Jurisdiction
and the Enforcement of Judgments in Civil and Commercial Matters 1968
(as set out in Sch 1 to the Civil Jurisdiction and Judgments Act 1982) (the
Brussels Convention).
[3] The issue in the present appeal is whether, for the purposes of art
27(2) of the convention, Mr J. was served 'in sufficient time to enable him
to arrange for his defence'. That issue in turn depends on whether the
relevant period of time is the two weeks allowed to enter an appearance
or the five weeks between service and the issue of the default judgment.
If it is the former period, then the parties are in dispute as to whether
that time was sufficient for the purposes of the convention. If, however,
the five-week period is the relevant one, then Mr J. accepts that he had
sufficient time and that the German judgment is entitled to registration
and enforcement in England.
[4] The issue identified above has emerged from the registration
proceedings in England not without difficulty. Since T. has disputed Mr
J.' entitlement to argue this issue in this court, I will have to set out
the background to this appeal in greater detail than would otherwise be
necessary.
The convention
[5] It is not in dispute that the convention is designed to facilitate the
recognition and enforcement of judgments issued in one contracting state
throughout all other contracting states. The scheme of the convention
is characterised by simplicity and speed. That scheme and the purposes
of the convention are empowered by the common agreement found in
the convention as to the establishment of jurisdiction. Since there is
consensus as to jurisdiction, the opportunities for challenge granted at the
stage of recognition and enforcement are correspondingly limited.
[6] Articles 26 and 31 provide the basic rules, which are that a judgment
shall be recognised without any special procedure being required, and
that a judgment enforceable in one contracting state shall be enforced
on application in another contracting state when it has been declared
enforceable there, or, in the case of the United Kingdom, when it has been
registered for enforcement in the relevant part of the United Kingdom,
eg in England and Wales. Articles 32-35 lay down the procedure for the
application for enforcement. In England and Wales it is to be made to the
High Court (and under RSC Ord 71, r 27 to a master). Article 34 provides:
'The court applied to shall give its decision without delay; the party
against whom enforcement is sought shall not at this stage of the
proceedings be entitled to make any submissions on the application.
The application may be refused only for one of the reasons specified in
Articles 27 and 28. Under no circumstances may the foreign judgment be
reviewed as to its substance.'
[7] Articles 36-41 are concerned with rights of appeal from what is
in effect an ex parte procedure at first instance. If enforcement is
authorised, the respondent has one month in which to lodge an appeal. In
England that would be to a High Court judge. If the application to enforce
is upheld on appeal, art 37(2) allows a further appeal, in these terms:
'The judgment given on the appeal may be contested only... in the United
Kingdom, by a single further appeal on a point of law.'
[8] The question has been raised whether art 37(2) gives a right of
appeal, free of the limitations of CPR Pt 52 and, in the case of second
appeals, of s 55(1) of the Access to Justice Act 1999 and CPR 52.13. It
has also been submitted that the art 37(2) appeal is not a true second
appeal, since the original hearing before the master is not inter partes.
As will appear below, it has not proved necessary to determine such
questions.
[9] As stated in art 34, the only exceptions to the applicant's right to
enforcement of a convention judgment are those contained in arts 27 and
28. For present purposes the only relevant exception is that set out in art
27(2) as follows:
'(2) Where [the judgment] was given in default of appearance, if the
defendant was not duly served with the document which instituted the
proceedings or with an equivalent document in sufficient time to enable
him to arrange for his defence.'
[10] It is interesting to observe that the same test of 'sufficient time
to enable him to arrange for his defence' is also contained in the
jurisdictional safeguards of art 20, which similarly apply where a
defendant does not enter an appearance, thus:
'Where a defendant domiciled in one Contracting State is sued in a court
of another Contracting State and does not enter an appearance, the
court shall declare of its own motion that it has no jurisdiction unless its
jurisdiction is derived from the provisions of this Convention. The court
shall stay the proceedings so long as it is not shown that the defendant
has been able to receive the document instituting the proceedings or an
equivalent document in sufficient time for him to arrange for his defence,
or that all necessary steps have been taken to this end. The provisions
of the foregoing paragraph shall be replaced by those of Article 15 of
the Hague Convention of 15 November 1965 on the service abroad of
judicial and extrajudicial documents in civil or commercial matters, if
the document instituting the proceedings or notice thereof had to be
transmitted abroad in accordance with that Convention.'
The background facts
[11] The background facts can be speedily stated. Mr J. is a Dutch
national, now resident in England near Sudbury in Suffolk. At some
point he was a director of an East German company, A. GmbH, which
did business with T.. In its statement of claim (or 'Klage') in Germany T.
claims against Mr J. in fraud, on the basis of his responsibility for falsely
certifying that work supposedly done by A. for T. and paid for by T. had
been carried out, when it had not.
[12] T.'s proceedings were issued in Germany on 20 October 1998. On 23
October 1998 the matter came before the regional court, whose presiding
judge was required to determine the period available to Mr J. from service
to enter his notice of appearance. Where a defendant is resident in
Germany, this period is fixed at two weeks and cannot be extended; but
where, as in this case, the defendant was resident abroad, the presiding
judge had to determine the period for appearing, and he fixed a period of
two weeks.
[13] It is common ground that prior to 1 January 2000 any party
to proceedings before a regional court had to be represented by a
Rechtsanwalt admitted to that particular regional court. However, all
that was required by way of a notice of appearance from such a duly
admitted Rechtsanwalt was a letter stating that the defendant appeared
and intended to contest the proceedings: a single sentence to that effect
would suffice, and no special formality was necessary.
[14] Service of the German proceedings was effected under the Hague
Convention through the English Supreme Court as the designated central
authority. A certificate of service for the purposes of the convention was
produced bearing the Supreme Court's stamp dated 9 February 1999. The
certificate records that service was effected by posting a sealed envelope
through the letter box of Mr J.' home in Sudbury.
[15] Before Jack J in the court below Mr J. denied that he had been duly
served on 9 February 1999 in this way. As Jack J said:
'It is Mr J.' case that he was abroad at that time, returning from the
United States on 15 February 1999. He states that he never saw the
envelope. He suggests that either his wife or his 15-month son may have
destroyed it. He also appears to suggest that it may have been delivered
to the house next door. If that had happened, presumably his neighbours
would have delivered it to him. He appears to have made no enquiries.'
[16] At any rate Jack J considered with the assistance of decisions of
the Court of Justice of the European Communities whether Mr J. could
successfully contest the due service of the Klage. He concluded that he
could not, and there is no appeal from that decision. Jack J reasoned as
follows:
'If service is effected at an address such as the defendant's business
address, or at his home, where in the ordinary course it should come to
his attention, then, provided that the time between the date of service
and the entry of the default judgment should have been sufficient for
him to arrange for his defence, it will normally be immaterial that such
service did not bring the proceedings to his attention. In contrast, if
service is effected at an address that may not, or is unlikely to, bring
the proceedings to the defendant's attention, then this is a factor which
the court may take account of and which may lead it to conclude that
the defendant had not had due time... I have found here that service
was duly effected at the defendant's home. There is no explanation as to
why it did not bring the proceedings to his attention. In my view there
are no exceptional circumstances here of the kind referred to by the
European Court in Klomps v Michel Case 166/80 [1981] ECR 1593, which
would justify me in concluding that by reason of them the period between
service and the default judgment was inadequate.'
[17] The judge therefore ruled that service had been duly effected; that
there were no exceptional circumstances for the purposes of the further
test of sufficient time to arrange his defence; and, implicitly, that that
further test was to be made by reference to the period between service
and default judgment, the five-week period, rather than the two-week
period allowed for entering notice of appearance.
[18] The regional court had issued its default judgment against Mr J. on
16 March 1999. T. had requested in its Klage that default judgment should
be entered in default of timeous entry of Mr J.' notice of appearance.
In such a case, upon expiry of the time limit, the regional court's
administration places the file before the court, whereupon judgment may
be entered. However, if a notice of appearance is entered late, but at any
time before default judgment signed by the judges has reached the court
office in order for it to be issued, the court is not permitted then to issue
the default judgment (para 331 of the Zivilproze--ordnung or ZPO).
[19] On the same day that the regional court had entered its default
judgment against Mr J. it wrote to him to inform him of the judgment. Its
letter arrived a few days later, for on 22 March 1999 Mr J. wrote to the
court stating that until receipt of the court's letter he had known nothing
of the proceedings. He asked for an extension of time in which to appeal.
The default judgment itself was formally served on Mr J. on 29 April 1999.
[20] It appears that Mr J. then had a fortnight in which to apply as of
right to set aside the default judgment, but he did not do so. However, on
26 May 1999 the regional court treated Mr J.' letter of 22 March as such
an application, but dismissed it as inadmissible because it had not been
filed and signed by a duly admitted Rechtsanwalt.
[21] It was not until 8 December 2000, over 18 months later, that Mr
J. filed, through a duly admitted Rechtsanwalt, an appeal against the
decision of 26 May 1999 in order to set aside the default judgment and
request reinstatement of the proceedings. The Oberlandsgericht (the
higher regional court) dismissed this appeal in its judgment of 17 January
2001. Mr J. pursued a further appeal to the Federal Supreme Court, but
failed there as well.
The judgment below
[22] A number of points were pursued by Mr J. before Jack J, but none
of them has survived to this appeal. There is no sign from the judge's
judgment, or from the skeleton arguments below, that the point which
has been argued on this appeal, namely that the relevant period for
testing whether Mr J. had sufficient time to arrange for his defence
was the two-week period allowed by the regional court for entering
an appearance and not the period of five weeks pending issue of the
default judgment, was even argued before Jack J (neither counsel in
this court appeared before Jack J). On the contrary, it appears to have
been assumed that the five-week period pending the issue of the default
judgment was the relevant period. This is reflected in the passage from
Jack J's judgment which I have cited above.
[23] It follows that there can be no assistance to this court on this appeal
to be derived from the reasoning in the judgment below.
[24] It also follows that the reasoning of Jack J on the factual aspect of
the test of sufficient time is no longer relevant in this court. Jack J had
to ask himself whether five weeks was a sufficient time in circumstances,
exceptional or not, where Mr J.' case had been that he had been absent
in America from the date of service on 9 February to 15 February 1998
and thereafter had never seen the sealed envelope which had been served
through his letter box. Clearly, if he had been able to prove that he had
never received the documents, which he could not, that may have been
a different situation. In the circumstances, his absence from home during
the limited period up to 15 February would have been of no consequence
in terms of the five-week period up to 16 March. One question which has
arisen on this appeal is whether it can still legitimately be brought into
play if the relevant period is only two weeks.
[25] The fact that the critical issue on this appeal was never argued
below has given support to T.'s submission that that issue is not properly
before this court. The real basis for that submission, however, requires
me to turn now to the circumstances in which Buxton LJ granted Mr J.
permission to appeal on his renewed oral application for such permission.
The grant of permission to appeal
[26] In his appellant's notice the essential ground of appeal raised by
Mr J. was that the two-week period allowed him to enter his notice of
appearance was insufficient time for him to arrange for his defence
within the meaning of art 27(2) (ground 4), especially in the light of his
absence from home until 15 February 1999 (ground 5). The point was
also made that the judge ought to have held that there were exceptional
circumstances within the meaning of the Court of Justice jurisprudence
(ground 7). There was also an application to admit new evidence, namely
the witness statement of a German law expert, Mr Jens Michael Priess, a
Rechtsanwalt, made on 16 March 2001.
[27] Buxton LJ focused on the principal point concerning the two-
week period allowed to Mr J. from service of the proceedings and
whether that was a sufficient period for him to arrange his defence. He
appreciated, correctly, that 'this issue was not raised before the judge'.
He appears, nevertheless, to have been under the misapprehension that
the alternative period of five weeks was a period commencing with the
service of the default judgment, rather than the period between service of
the Klage and the making of the default judgment. He therefore identified
as a possible error on the part of the judge, but in my view mistakenly,
that the judge had viewed the default judgment rather than the Klage as
the 'document which instituted the proceedings' whose service had, for
the purposes of art 27(2), to allow sufficient time to enable a defendant to
arrange for his defence. Despite that misapprehension, Buxton LJ was, in
my judgment, clear that the issue for which he gave permission to appeal
included that identified in Mr J.' grounds of appeal. Thus he said:
'I therefore give leave limited to that issue, that is to say whether the
judge correctly determined what was for present purposes the document
instituting the proceedings; and secondly, what follows from that as to
his conclusion that there had been sufficient time for Mr J. to arrange his
defence.'
[28] The first part of that permission was, on the understanding that
both parties and this court now have of the matter, unnecessary: but
the second part directly raised the issue whether Mr J. had had sufficient
time to arrange for his defence. Whether, for the purpose of that issue,
the time was two weeks or five was not perhaps explicitly identified:
nevertheless, that question necessarily became critical to the appeal. And
whether it was two weeks or five, was it enough?
[29] I therefore reject the submission of Mr Michael Davey on behalf of
T. that there is no permission to appeal in respect of the principal issue
which Mr J. wishes to argue in this court, namely the submission that the
relevant period whose sufficiency has to be assessed for the purposes of
art 27(2) is one of two weeks rather than, as assumed before the judge
below, one of five.
[30] However, as for ground 7 of Mr J.' appellant's notice, that relating to
the presence of exceptional circumstances, Buxton LJ refused permission
to appeal.
[31] As for Mr J.' application to adduce fresh evidence, Buxton LJ said as
follows:
'As I have explained to Mr Jack, that is not an application that is within
my power to grant, given that it requires adversary argument. Mr Jack,
has, however, permission, if so advised, to renew such an application to
the full court. He may or may not find that that is a matter, in view of the
nature of the evidence, that can be resolved by agreement before the
hearing, and certainly efforts must be made to do that, so that the time of
the court can be saved.'
[32] Nevertheless Buxton LJ had already commented that it seemed
to him that the point on which he had given permission to appeal 'will
require some reasonably sophisticated analysis of the German process
to put in context the issue arising under art 27(2)'. That was on 11 May
2001. Pursuant to Buxton LJ's order made that day, Mr J. amended his
grounds of appeal and accompanying skeleton argument. A new ground
5A stated that Jack J had erred in treating the five-week period from
service to judgment by default as the relevant period. That correctly
exposed the question inevitably covered by Buxton LJ's permission to
appeal: as Buxton LJ had said, such amended documents should set out
'the point now in issue and the implications of it'. Ground 7 dealing with
exceptional circumstances was now deleted. The new skeleton argument
dated 30 May 2001 correctly stated that permission to appeal was granted
on 'the single issue as to whether the two-week period given by the
German Court for Mr J. to enter an appearance was sufficient time to
enable him to arrange for his defence'.
[33] On 5 July 2001 Buxton LJ made further directions in the appeal. He
ordered the parties to 'make active and immediate efforts to agree any
points as to German law and practice that are in issue'. That the parties
have done. Thus they have drawn up a 'Joint Statement of German Law'
which identifies those parts of Mr Priess' witness statement on which
there is common ground. Nevertheless, as it remains formally open to it
to do, T. still objects to the admission of any further evidence, including
the joint statement, from Mr J., and submits that if such evidence is
admitted, then there is still further evidence of German law that it would
wish to introduce.
[34] I am now in a position to address directly the essential issue which
arises on this appeal.
The relevant period: two weeks or five?
[35] On behalf of Mr J., Mr Adrian Jack submitted that, however easy
and efficient the convention's scheme for the free transfer of judgments
between contracting states was intended to be, art 27(2) reflected a
concern to protect defendants which was paramount. That concern would
be undermined if the relevant period extended up to the date of the
default judgment itself. A defendant ought to be in a position to know
upon service of proceedings how long he had to arrange his defence,
and to be able to take advice from his lawyers accordingly. If the time
allowed him was insufficient, then he was entitled to know there and then
that he could afford to ignore the proceedings. If, however, the relevant
period depended on the time taken to issue a default judgment, then a
defendant would be in a position of uncertainty.
[36] On behalf of T., on the other hand, Mr Michael Davey submitted that
the purposes of the convention were best promoted if the derogation
from recognition allowed by art 27(2) was not construed in such a way
as to interfere unduly with the policy of rapid and easy enforcement of
judgments. The question should therefore be: did Mr J. as a matter of
fact have sufficient time to arrange for his defence? If he did, there would
be no justification in refusing to recognise or enforce a default judgment
against him or any other defendant in a similar position. It would be
bizarre to think of a defendant seeking advice from his lawyers as to
whether he could safely allow a default judgment to be given against him
on the basis that the time allowed for a notice of appearance was too
short.
[37] Both counsel sought to derive support for their respective positions
from a limited number of cases in the Court of Justice.
[38] In Klomps v Michel Case 166/80 [1981] ECR 1593 Mr Michel applied
in Germany for a summary order for payment of a debt against Mr
Klomps. Service was effected by a special procedure in Germany. Under
the then current legislation in Germany, Mr Klomps was allowed a period
of not less than three days in order to submit an objection to the order
for payment, but that period was extended until such time as the German
court issued an order for its enforcement, and in the event that period
was six days from service. After service of the enforcement order Mr
Klomps had a further period of one week to lodge an objection to that
order. Mr Klomps did nothing for four months. He then claimed to reside
in Holland and invoked the protection of art 27(2). Two of the issues
before the Court of Justice are relevant for present purposes. The first
(the 'second question' before the court) was whether, on the assumption
that the payment order rather than the enforcement order was the
'document which instituted the proceedings', account should nevertheless
be taken of the further period of one week allowed for objecting to the
enforcement order for the purposes of deciding whether Mr Klomps had
had sufficient time to arrange for his defence. On that question the court
ruled (at 1606 (para 10)) as follows:
'... the court in which enforcement is sought must take account only
of the time, such as that allowed under German law for submitting
an objection to the order for payment, available to the defendant for
the purposes of preventing the issue of a judgment in default which is
enforceable under the Convention.'
In other words, the payment order was there the equivalent of the Klage
in the present case, the enforcement order was there the equivalent of
the default judgment in the present case, and the only relevant period
was the period available for the purposes of preventing the issue of such a
default judgment.
[39] The second issue relevant for present purposes (the 'fourth question'
before the court) was in two parts. The first was whether the finding by
a court in the country in which the judgment was given, that service had
been duly effected, rendered it unnecessary for the court in the country
in which enforcement is sought to consider whether service had been
effected in sufficient time for the defendant to arrange for his defence.
On that part of the second question the court held that that enquiry was
still necessary. The second part of the fourth question was whether that
enquiry was limited to the finding that the document reached the habitual
residence of the defendant in sufficient time or whether it was also
necessary that such service should provide a sufficient guarantee that the
document would reach the defendant personally in good time (see para
17). On that issue the court reasoned as follows (at 1608-1609):
'19. In this connection it must be stated first of all that Article 27,
point 2, does not require proof that the document which instituted the
proceedings was actually brought to the knowledge of the defendant.
Having regard to the exceptional nature of the grounds for refusing
enforcement and to the fact that the laws of the Contracting States on
the service of court documents, like the international conventions on
this subject, have as their objective the safeguarding of the interests of
defendants, the court in which enforcement is sought is ordinarily justified
in considering that, following due service, the defendant is able to take
steps to defend his interests as soon as the document has been served on
him at his habitual residence or elsewhere. As a general rule the court in
which enforcement is sought may accordingly confine its examination to
ascertaining whether the period reckoned from the date on which service
was duly effected allowed the defendant sufficient time to arrange for his
defence. Nevertheless the court must consider whether, in a particular
case, there are exceptional circumstances which warrant the conclusion
that, although service was duly effected, it was, however, inadequate for
the purposes of enabling the defendant to take steps to arrange for his
defence, and accordingly, could not cause the time stipulated by Article
27, point 2, to begin to run.
20. In considering whether it is confronted with such a case the court in
which enforcement is sought may take account of all the circumstances
of the case in point, including the means employed for effecting service,
the relations between the plaintiff and the defendant or the nature of the
steps which had to be taken in order to prevent judgment being given
in default. If, for example, the dispute concerns business relations and if
the document which instituted the proceedings was served at an address
at which the defendant carries on his business activities the mere fact
that the defendant was absent at the time of service should not normally
prevent him from arranging his defence, above all if the action necessary
to avoid a judgment in default may be taken informally and even by a
representative.'
[40] It will be observed that neither of these questions is directly
concerned with the issue before us. The Court of Justice was not asked
to decide, as would have been directly analogous to the present appeal,
whether it was the three-day period following service or the six-day
period ending in the enforcement order that was the relevant period for
the assessment of the 'sufficient time'. Nevertheless, counsel have drawn
our attention to the reasoning of the court because each of them submits
that it at least indirectly or implicitly supports their respective positions.
Thus Mr Davey emphasises the statement by the court of the facts of
that case (in para 3) where the period of six days is mentioned as well
as the period of three days; and the language of the court to the effect
that consideration is to be given as to what needs to be done in time
to prevent judgment being given in default (see eg para 10). Whereas
Mr Jack relies on the reference, also in para 10, to account being taken
only of that period of time 'allowed under German law for submitting an
objection', which he submits must be the three-day rather than the six-
day period.
[41] In this connection our attention was also directed to the opinion
of Mr Advocate General Reischl. He preferred the view (at 1618-1619)
that the relevant period extended until the time for objecting to the
enforcement order had expired, a view ultimately not adopted by the
court. Nevertheless, in the course of conceding the cogency of the
opposing view that the time for objecting to the enforcement order was
irrelevant, he appears to have proceeded on the basis that in that case
(ultimately the judgment of the court) it was necessary to take account of
the fact that Mr Klomps had not only three days, but six for arranging his
defence. Thus he said (at 1618):
'In that connection it is of course necessary to take into account a number
of factors in ascertaining whether this period is reasonable. What is
concerned is not a strict exclusionary time-limit. On the contrary, it was
possible for an objection to the order for payment to be made until the
enforcement order was issued, which, owing to the volume of work, was
often not done until some considerable time had elapsed, in this case six
days after the issue of the order for payment. It is also important that
during that time the debtor is simply required to make it known that he
does not admit the claim. That may be done without giving reasons and
without observing any requirements as to form...'
[42] I will defer comment on Mr Davey's and Mr Jack's respective
submissions until I have completed the citation of authority.
[43] In Debaecker v Bouwman Case 49/84 [1985] ECR 1779 the question
before the Court of Justice was more fact-specific and concerned what
a court in the country of enforcement could take into account for the
purposes of assessing the question of sufficient time. Nevertheless, Mr
Jack relied on the following statement of principle (at 1796 (para 10)):
'Although the Convention is, as is clear from the preamble, intended
to "secure the simplification of formalities governing the reciprocal
recognition and enforcement of judgments of courts or tribunals", that
aim cannot, according to a series of decisions of the Court, be attained by
undermining in any way the right to a fair hearing.'
[44] Mr Jack also relied on Isabelle Lancray SA v Peters and Sickert KG
Case C-305/88 [1990] ECR I-2725, where French proceedings were
served on the defendant in Germany. There was no dispute there that
service had been effected in sufficient time for the defendant to arrange
for its defence: but it was said that service had not been effected in due
form because the document instituting the proceedings had not been
translated into German. The court pointed out (at 2747 (para 18)) that-
'the requirements of due service and service in sufficient time constitute
two separate and concurrent safeguards for a defendant who fails to
appear. The absence of one of those safeguards is therefore a sufficient
ground for refusal to recognize a foreign judgment.'
[45] It was nevertheless submitted that service in due form did not
matter since the defendant in any event had had sufficient time to
respond. The court disagreed. It said (at 2748):
'20. That reasoning cannot be accepted... it would render completely
inoperative the requirement of due service. If the sole issue were whether
the document came to the defendant's attention in sufficient time,
plaintiffs would be tempted to ignore the prescribed forms for due service,
the requirements of which have in any event been considerably relaxed
by international agreements. That would create considerable uncertainty
as to whether documents had actually been served, thus thwarting
the uniform application of the provisions of the Convention. Finally, a
defendant could not know with certainty whether proceedings which might
lead to a finding against him had been properly instituted and whether it
was therefore necessary to arrange for a defence, a situation which would
also be inconsistent with the aims of the Convention.
21. It must be added that, as the Court held in its judgment in Case
49/84 Debaecker v Bouwman [1985] ECR 1779, although the Convention
is, as is clear from its preamble, intended to secure the simplification
of formalities governing the reciprocal recognition and enforcement
of judgments of courts or tribunals, that aim cannot be attained by
undermining in any way the right to a fair hearing.'
[46] Mr Jack therefore submitted first, that the preservation of the right
to a fair hearing for the defendant was paramount, and secondly that
matters had to be judged as of the moment of service: the defendant was
entitled there and then to know whether the proceedings against him had
been served in such a way as to have met the twin requirements of due
form and of sufficient time.
[47] Finally, Mr Jack relied on Minalmet GmbH v Brandeis Ltd Case
C-123/91 [1992] ECR I-5661. There the facts involved a combination of
the issues raised in both Klomps's case and the Lancray case: service
had not been effected in due form but the defendant had subsequently
received notice of the default judgment and had failed to take advantage
of the legal remedies available to him to set that judgment aside. The
Court of Justice ruled that the judgment could not be enforced, since the
defendant had never been duly served. It referred to Klomps's case where
the court had said ([1981] ECR 1593 at 1605 (para 9)) that art 27(2)-
'is intended to uphold the rights of the defence and ensure that a
judgment is not recognized or enforced under the Convention if the
defendant had not an opportunity of defending himself before the court
first seised.'
It went on ([1992] ECR I-5661 at 5679 (para 19)):
'... the proper time for the defendant to have an opportunity to defend
himself is the time at which proceedings are commenced. The possibility
of having recourse, at a later stage, to a legal remedy against a judgment
given in default of appearance, which has already become enforceable,
cannot constitute an equally effective alternative to defending the
proceedings before judgment is delivered.'
[48] This court was also referred to passages in the Jenard Report (OJ
1979 C59, p 1). These in my judgment take matters no further, for their
observations are reflected in the judgments of the Court of Justice. It is
interesting to note, however, that Mr Jenard states, under art 30, that-
'That court has in practice only two points to examine: public policy and
whether the defendant has had the opportunity of defending himself.'
That language of 'opportunity of defending himself' is reflected in the
language of para 9 of the judgment in Klomps's case cited above.
[49] The conclusions at which I arrive on this jurisprudence and the
competing submissions before this court are as follows. (1) The point
at issue in this case is not covered precisely by any authority brought
to our attention. (2) Nevertheless, the language in which the Court of
Justice repeatedly glosses the critical words of art 27(2) ('in sufficient
time to enable him to arrange for his defence') suggests that the relevant
period of time which has to be examined is the period right up to the
issue of the default judgment. Thus the court uses language such as 'an
opportunity of defending himself' and 'the time available to the defendant
for the purposes of preventing the issue of a judgment in default' and
'time to prepare his defence or to take the steps necessary to prevent
judgments being given in default' and 'the nature of the steps which had
to be taken in order to prevent judgment being given in default' (Klomps's
case); or 'an equally effective alternative to defending the proceedings
before judgment is delivered' (the Minalmet case). (3) Whereas the
requirement of due form for the purposes of service is strictly enforced
(the Lancray and Minalmet case), that is only to be expected where due
form is the subject of examination. On the other hand the requirement
of sufficient time is not a question of form but of fact to be decided on
all the circumstances of the case (Klomps's case). Moreover, form can
necessarily only be judged at the point of service, whereas that is not
true of the question of sufficient time. Prima facie that is an empirical
matter to be assessed over the whole period starting with service and
ending with the default judgment. It follows that the strict approach of
the court to the first requirement of due form does not necessarily throw
light on the approach to be taken to the second requirement of sufficient
time. (4) Although the cases stress the importance of the protection
to the defendant provided by art 27(2) and thus the need to protect
the defendant's right to a fair hearing, that is by way of exception to
the convention's underlying purpose to ensure the free movement of
judgments between the contracting states. To do justice to both purposes
requires that the exception not be expanded further than is reasonably
necessary to achieve the required protection of the defendant's right
to a fair hearing, that is to say of his opportunity to defend himself and
to prevent a judgment being given against him by default. That can be
achieved if the relevant period to be examined for its sufficiency is the
period during which a notice of appearance will in fact prevent the issue
of a judgment by default. (5) If, therefore, German procedural law were
to the effect that once the period allowed for a notice of appearance had
expired it would thereafter be too late to enter an appearance, however
long judgment by default might be delayed, then it would follow that the
relevant period would expire with the time allowed for that appearance,
such as the two weeks set by the presiding judge of the regional court.
For in that case, there would be nothing that a defendant could do to
prevent a judgment by default issuing. (6) In the present case, however,
it is common ground that a valid notice of appearance entered at any
time prior to the issue of a default judgment would have prevented its
issue. Mr Priess' evidence is that that is so as a matter of 'practice'. T.'s
submission is that that was so as a matter of the provisions of the ZPO
itself (para 331). This court was not shown the provisions of the ZPO, but
as stated above it was agreed, by reference to para 11 of the parties' joint
statement of German law, that if a notice of appearance is entered late
but at any time before default judgment signed by judges has reached
the court office in order for it to be issued 'the court is not permitted then
to issue a default judgment (para 331 of ZPO)'. (7) The conclusions set
out above are consistent with the presence of the same test of sufficient
time being included in art 20 of the convention as a requirement for the
establishment of jurisdiction. Article 20 states that the court seised of
the claim should stay the proceedings unless satisfied that the defendant
has had sufficient time. Ex hypothesi no judgment has yet been entered
but, as contemplated by the first paragraph of art 20, the defendant 'does
not enter an appearance'. The inference is that the court should test the
question of sufficient time by reference to the full facts and not merely
because there has been a default of appearance.
[50] I therefore conclude that the relevant period by which to test the
sufficiency of the time available to Mr J in this case is the period of five
weeks ending on 16 March 1999.
[51] I note that this conclusion is consistent with the view expressed in
Briggs and Rees Civil Jurisdiction and Judgments (2nd edn, 1997) para
2.199 where, in the course of a discussion about art 20, the following is
found:
'If the plaintiff rushes to obtain a default judgment, he runs the risk that
the court will refuse to enter it, or that a court called upon to recognise
that judgment will decline to do so.'
Did Mr J have sufficient time to arrange for his defence?
[52] In the circumstances it is unnecessary to make any findings as to
this question, for it is accepted by Mr Jack that if the relevant period is
five weeks then Mr J. did have sufficient time.
[53] If the relevant period for examination had been the two-week period,
this court would in principle have had the choice of either deciding it itself
or of remitting it back to the High Court for its decision. Further costs
and delay would have been avoided if the decision could have been made
here, and that would have been the preferable choice. It is not clear,
however, that this court would have had the facts needed for its decision.
This is in essence because of the way in which the issue has developed,
since the sufficiency of the two-week period has never previously been
examined, and also because T. had taken its stand against Mr J' right to
conduct his appeal in this court.
[54] In that connection Mr Davey has submitted that, since art 37(2)
only gives a further appeal 'on a point of law', it would not have been
open for this court to examine the question of fact involved in the test of
sufficient time. However, it seems to me that that submission is in error:
it not infrequently occurs that, if the right legal test has not been adopted
by a lower court, then a new question of fact needs to be resolved. It
may be that in certain contexts, such as arbitration, a remission becomes
unavoidable (unless the missing finding is implicit in the current award),
since arbitrators are the sole finders of fact. That problem, however, does
not arise in the present context, where the litigation as a whole has been
conducted in the courts.
[55] Another question which would have arisen if the two-week period
had been the relevant one for examination is the extent to which it would
have been open to this court, or to the High Court on any remission,
to consider that question in the round. For instance, Buxton LJ refused
permission to appeal on the ground of exceptional circumstances. In
my view, if the two-week period had had to have been examined, I
would not for myself have placed any limitation on that enquiry from
the point of view of Mr J' allegation that he had been absent from home
until 15 February 1999. Jack J. never had to consider below the question
of Mr J' absence from his home in the context of a period of only two
weeks. The Court of Justice in Klomps's case emphasised that a court,
in examining the question of sufficient time, is entitled to take account
of 'all the circumstances of the case in point'. It went on to point out
that in a commercial matter where service is effected at the defendant's
business address, the defendant's absence at the time of service should
not 'normally' prevent him from arranging his defence, particularly if the
action necessary to avoid a judgment may be taken informally and by a
representative. It may therefore be arguable, and it is unnecessary to
form even a view on the point, that the significance of that example is
that it is normally to be presumed that business activities are carried on
in such a way that arrangements for taking limited legal steps (viz the
mere filing of a notice of appearance) can be presumed to be in place
despite the absence of a principal. Whether the same can be said where
service of the proceedings is effected at a private home may be another
question.
A reference to the Court of Justice?
[56] Mr Jack also submitted on behalf of Mr J. that the issue of the
relevant period should be referred to the Court of Justice, on the basis
that it was a doubtful question of interpretation and not acte clair. I do
not agree. In my judgment there is nothing in the wording of art 27(2) or
in the jurisprudence of the Court of Justice to lead me to think that this
would be an appropriate case for reference.
Conclusion
[57] In conclusion, the relevant period for examination under art 27(2)
is that beginning with due service and ending with the issue of the
default judgment. In the circumstances it is accepted by Mr J. that he had
sufficient time to arrange for his defence. This appeal must therefore be
dismissed.