A. Introduction
The Reciprocal Enforcement of Judgments Act 1958 (“REJA“) facilitates direct execution of foreign judgments from reciprocating foreign countries listed in the First Schedule of the REJA. The reciprocating countries include UK, Hong Kong, Singapore, New Zealand, Sri Lanka and India.
For countries not falling within REJA, enforcement is still possible by virtue of common law. There are two parts to this enforcement process. First, jurisdiction i.e the admission of the foreign judgment in Malaysia. Second, merits i.e the defence that the debtor under the foreign judgment can raise. This article will only focus on the former.
The jurisdiction or admissibility issue was recently discussed by the Federal Court in Pembinaan SPK Sdn Bhd v Conaire Engineering Sdn Bhd-LLC & Anor. In essence, a non-REJA foreign judgment is only enforceable if it is proven under the Evidence Act 1950 (“EA”).
B. Questions of Law before the Federal Court
Leave was granted for the following questions of law:
(i) Whether a foreign judgment is enforceable by a common law action in Malaysia (the foreign country not being a First Schedule country under the REJA”) if the judgment is not proved as a foreign judgment or order in accordance with the EA?
(ii) Whether a foreign judgment purporting to be a default judgment where liability on quantum and assessment of compensation was decreed in absentia satisfies the basic rules of fair procedure and natural justice to be enforceable by way of a common law action in the Malaysian courts?
(iii) In a common law action to enforce a foreign judgment not being a First Schedule country under the REJA, without the foreign judgment being proved in accordance with Chapter V of the EA, whether there is a sustainable cause of action for other evidence to be admitted and weighed?
(iv) In a common law action to enforce a foreign judgment not being a First Schedule country under the REJA, whether the party responding to the common law action is limited only to the defences set out in See Hua Daily News Bhd v Tan Thien Chin & Ors [1986] 2 MLJ 107?
(v) In a common law action to enforce a foreign judgment not being a First Schedule country under the REJA, whether the applicant suing upon that judgment as a cause of action is obliged to prove its claim on liability and quantum?
(vi) Whether a non-REJA foreign judgment benefits from the same limited defences against the registration of a First Schedule REJA foreign judgment under section 5 of REJA?
The Federal Court answered the first three questions in the negative. Given that the foreign judgment in question is not admissible, the Federal Court found no reason to answer the remaining three questions, which touch upon the defences against the enforcement of the foreign judgment.
C. Facts of the Case
The respondent obtained judgment against the appellants in Abdu Dhabi. Thereafter, the respondent commenced proceedings against the appellants to enforce the Abu Dhabi judgment in Malaysia. Abu Dhabi is a non-REJA country.
The respondent tendered an English translation of the Abu Dhabi judgment in the enforcement proceedings. The first attempt of the translation was vigorously challenged for allegedly errors on the identity of the parties sued. There are further three translations of the judgment. The original copy of the Abu Dhabi judgment, although exhibited as an attachment to the translations, was not properly tendered.
D. Decision by the Federal Court
The Federal Court held that enforcement of a non-REJA foreign judgment is different from a that of a REJA judgment in this sense. REJA provides for direct execution of a REJA foreign judgment. For a non-REJA foreign judgment, the winning party in the judgment needs to establish jurisdiction against the losing party and a local judgment needs to be obtained first.
It was further held that a non-REJA foreign judgment “only creates a debt between the same parties [and] provides a cause of action on which the debtor can be sued on our shores”.
This is the author’s observation on the distinction between the enforcement of a REJA foreign judgment and a non-REJA foreign judgment. Section 4 of the REJA provides for registration of a REJA foreign judgment. Once this judgment is registered, it can be immediately enforced against the losing party in the judgment. This is subject to a setting aside of the registration of the foreign judgment. Section 5 of the REJA sets out circumstances in which: (i) the registration of the judgment can be set aside; and (ii) the Malaysian Court has no jurisdiction over the losing party in the foreign judgment. This means two things. First, once registered, the REJA foreign judgment is valid until and unless it is being set aside. Second, there is an assumption of jurisdiction over the losing party (until and unless you fall under the circumstances under Section 5 of the REJA). This is unlike enforcement of a non-REJA foreign judgment where it is first necessary to obtain a local judgment.
We come to the more important part of the Federal Court’s decision in Pembinaan SPK, which touches upon the leave questions answered in the negative by the Federal Court. The Federal Court held that for the Abu Dhabi judgment to be admitted into evidence, it must adhere to either sections 78(1)(f) or 86 of the EA.
Section 78(1)(f) of the EA provides that the copy of judgment relied upon (be it original or a copy) must be certified under the seal of a notary public or of a consular officer of Malaysia having the lawful custody of the original and upon proof of the character of the document according to the law of the foreign country.
Section 86 of the EA provides that the foreign judgment must be certified by any representatives of the YDPA as a copy of a judicial record in the manner commonly in use in the local country for the certification of copies of judicial records.
Here, not only that the original Abu Dhabi judgment was not properly tendered, it is not certified in accordance with sections 78(1)(f) or 86 of the EA.
Interestingly, the Federal Court also looked into the specific procedural requirements on the registration of a REJA foreign judgment under Order 67 of the Rules of Court 2012 and section 11 of the REJA, where the foreign judgment must be exhibited, or its copy must be verified, certified or authenticated. The Federal Court held that “we do not see why the evidentiary rules should be any different [between the enforcement of a REJA judgment and a non-REJA judgment] particularly in the face of the specific provisions of the [EA] as identified earlier”.
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