In a judgment of 7 September 2022, the French supreme court for private and criminal matters (Cour de cassation) addressed several issues arising out of applications to declare enforceable judgments wrongfully filed under the Brussels I Regulation.
While the Brussels I bis Regulation does not provide for a declaration of enforceability of judgments anymore, the Succession and Matrimonial Property Regulations still do.
In 1997, the European Commission granted € 132,000 to an agency for local democracy in Croatia to offer training to local officials. With the grant came various reporting obligations to the Commission within 18 months. The individual who received the grant did not comply with them. The European Commission sued him in Croatian courts and obtained in April 2012 a judgement from a Croatian court ordering restitution of the monies.
As the debtor had relocated in France, the Commission sought to enforce the Croatian judgment in France under the Brussels I Regulation. It obtained a certificate from the Croatian court in 2014, and, in 2015, a declaration of enforceability of the judgment from an officer of a French court.
The debtor appealed to the court of appeal of Colmar (France), which declared the application for a declaration of enforceability inadmissible, on the ground that it fell outside of the scope of the Brussels I Regulation.
Temporal Scope of Brussels I Regulation
It is not always easy to navigate the rules on the scope of EU regulations, including, it seems, for the European Commission itself…
Croatia acceded to the European Union and to the Brussels I Regulation in 2013. In this case, therefore, not only had the proceedings been initiated before Croatia acceded, but the judgment had also been rendered the year before.
The transitional provisions in the Brussels I Regulation (Article 66) provide that, for the rules on recognition and enforcement of judgments to apply, the judgment should, at the very least, have been made after the entry into force of the Regulation, depending, in particular, on whether the Lugano Convention applied before the entry into force of the Regulation (Article 66(2)).
Power of the Court of Appeal
An interesting question was that of the powers of the French Court of Appeal. The first instance French authority had declared the Croatian judgment enforceable on the basis of the Brussels I Regulation. The power of the Court of Appeal was defined by Article 45(1) of the Regulation, which provides:
The court with which an appeal is lodged under Article 43 or Article 44 shall refuse or revoke a declaration of enforceability only on one of the grounds specified in Articles 34 and 35. (…)
As most readers will know, the grounds in arts 34 and 35 do not include that the judgment did not fall within the scope of the Regulation. Indeed, the Cour de cassation recalled that the CJEU ruled in Case C-139/10 (Prism Investments BV) that a declaration of enforceability could only be revoked on the grounds in Articles 34 and 35.
Interpreted literally, this would mean that a court of appeal could not review the first instance decision in so far as it would have found wrongly that the regulation applied. As Adrian Briggs wrote in his treatise on Civil Jurisdiction and Judgments, Article 45(1) should “not be taken completely seriously”.
The Cour de cassation rules that Article 45 should be interpreted as limiting the power of the court of appeal to the verification of the existence of a ground in Articles 34 and 35 and the applicability of the regulation (the court suggests that this also flows from the case law of the CJEU).
While it seems clear that the court of appeal should have the power to review the applicability of the Regulation, it is unclear whether this should be considered as mandated by Article 45. If the Regulation does not apply, Article 45 should not either. The remedy should thus be, rather, that the action seeking a declaration of inadmissibility under the Regulation should be declared as inadmissible, for the Regulation would not apply.
After the European Commission was reminded about the date Croatia acceded to the EU, it logically decided that it would thus seek to enforce the Croatian judgment under the French common law of judgments.
The debtor, however, argued that the judgment of the Court of appeal dismissing the first action under the Brussels I Regulation was res judicata, and that the European Commission could not relitigate the case under a different regime.
Under French law, res judicata extends to all arguments which could have been raised in the first proceedings. This, in effect, means parties to French proceedings are under an obligation to raise immediately all possible arguments in support of their claim. In this case, the European Commission would only be given one chance to demonstrate its mastery of the law of foreign judgments.
The Cour de cassation, however, rules that, in the context of an appeal under Article 43 of the Regulation, the European Commission could not have made any argument under the French common law of judgments. As a result, the judgment of the court of appeal should not prevent the Commission from making these arguments in a new action.