Haji-Ioannou v Frangos [QBD]
| Jurisdiction | England & Wales |
| Judge | Slade J. |
| Judgment Date | 21 September 2009 |
| Court | Queen's Bench Division |
| Date | 21 September 2009 |
[2009] EWHC 2310 (QB)
Queen's Bench Division.
Slade J.
Richard Millett QC and James Collins (instructed by Bird & Bird LLP) for the applicants.
Alexander Layton QC and Sara Masters (instructed by Waterson Hicks) for the respondent.
The following cases were referred to in the judgment:
Barlow Clowes International Ltd v HenwoodUNK [2008] EWCA Civ 577.
Bowler v John Mowlem & Co LtdWLR [1954] 1 WLR 1445.
Fielding v RigbyWLR [1993] 1 WLR 1355.
Haji-Ioannou v Frangos [1999] CLC 1075.
Udney v Udney [1869] LR 1 Sc & Div 441.
Vanquelin v BouardENR (1863) 15 CB (NS) 341; 143 ER 817.
Registration of foreign judgments — Applicant died after application issued for registration of Greek judgment in England — Master made registration order — Putative heirs substituted as applicants in registration application — Claimant died intestate — Applicants had not surrendered right to inherit benefit of judgment — Right of succession to judgment determined according to law of deceased's domicile — Deceased domiciled in Monaco — Monegasque conflicts laws applied law of deceased's nationality to questions of succession — English law as law of deceased's nationality referred back to law of domicile so that Monegasque law of succession applied — Under Monegasque law applicants had not acquired necessary interest in judgment to apply for registration until after master's order — Registration order set aside — Greek judgment only registrable so far as relating to costs and declaratory parts of judgment not registrable — Substitution order upheld — Council Regulation 44/2001, art. 38.
This was an appeal by the defendant (F) against two orders made by a master granting an application for registration of a Greek judgment and later substituting the respondents as applicants in the application for registration.
The original applicant (LH) claimed repayment of sums totalling $49,035,918 from F, his former son-in-law. LH contended that the money had been paid to F as a loan. F maintained that the sums were paid as a gift. The Greek court declared that F was indebted to LH in the sum of US$49,035,918, together with interest, and ordered F to pay LH €700,000 in respect of legal costs. LH applied to register the judgment in England pursuant to Council Regulation 44/2001 and the master made the order sought. However, LH had died two days after the application for registration was issued. The master made a second order for LH's widow and children to be substituted as applicants.
LH was born in Cyprus and had British nationality. In about 1990 he acquired a domicile of choice in Monaco. When he became ill towards the end of his life he went to live in Athens where he received medical treatment. He died intestate in Athens.
F argued that the applicants did not have an interest in the judgment satisfying the requirements of art. 38 of the regulation for its registration. For the same reason it was contended that the substitution order should be set aside. F questioned whether LH had in fact died intestate or whether there was a will. He also claimed that the applicants or some of them had surrendered their rights to inherit the claim against F.
Subject to the question of whether the applicants had given up their rights to succeed to the claim, it was accepted that on the intestacy of LH the applicants were or would become entitled to the judgment, a moveable asset of the late LH, whether Greek, Monegasque or English law applied. there was an issue between the parties as to when they had or would become so entitled.
Held, allowing F's appeal against the registration order, but dismissing his appeal against the substitution order:
1. On the evidence LH did die intestate and his children had not surrendered their right to inherit the benefit of the judgment against F.
2. LH had not abandoned Monaco and acquired Greece as his domicile of choice before he died. Monegasque conflicts laws applied the law of the deceased's nationality to questions of succession. Where, as here, the law of the deceased's nationality referred back to his law of domicile, in this case Monegasque law of succession would apply.
3. In accordance with Monegasque law the applicants acquired qualité d'héritier, the status or quality of heirs, on the date of LH's death. The evidence of Monegasque law was to the effect that obtaining the status of heir and acceptance of inheritance rights were two separate and distinct steps. An heir might not accept his inheritance rights. Regarding such a person as having an interest in property, a judgment, which he had not and might never accept, would not be consistent with the registration and enforcement scheme of the Regulation. The applicants failed to establish that they had accepted their inheritance by the date of the making of the registration order. Under the Monegasque Civil Code, acceptance of inheritance was deemed effective as of the date of death. However, that deeming provision could not retrospectively validate a registration order made pursuant to art. 38 of the Regulation. Thus the registration order had to be set aside.
4. The applicants had since formally accepted their inheritance rights, and acquired the necessary interest in the Greek judgment. From that date they were entitled to apply to have it registered under art. 38.
5. Only the part of the judgment ordering F to pay costs of €700,000 could be registered under art. 38. The other parts of the judgment against F were declaratory only. The declarations could be used in further proceedings to obtain judgment for sums of money but they were not enforceable.
6. The registration order would also have been set aside on grounds of material non-disclosure. The master was not informed that the person entitled to register the judgment had died. As the appeal had demonstrated, the question of whether and when the applicants became entitled to the judgment was far from straightforward. The death of LH would have required the applicants to satisfy the master that they had the interest in the judgment required by art. 38 at the time she was determining the application. There was also non-disclosure in applying for the substitution order but it was not sufficiently serious to justify setting aside the substitution order.
Slade J:
1. Mr Frangos appeals from two orders made by Master Fontaine. By the first order made on 13 January 2009 under the provisions of Council Regulation 44/2001 (the “Regulation') the Master registered an Order in favour of Loucas Haji-Ioannou (“LH”) made by the Greek Court of Appeal on 12 May 2008 (the “Registration Order”). Two days after the application for registration of the judgment was issued, on 17 December 2008 LH died. By the second order on 3 June 2009 (the “Substitution Order”) the Master substituted as Applicants, Nedi Haji-Ioannou (“NH”) the widow of LH, and his children, Strylianos Haji-Ioannou (“SH”), Polys Haji-Ioannou (“PH”) and Clelia Haji-Ioannou (“CH”) who will be referred to as “the Applicants”. References in this judgment to Articles are to articles in the Regulation unless otherwise indicated.
2. This is the latest round in this jurisdiction of a long dispute in which the late LH claimed repayment of sums totalling $49,035,918 from Mr Frangos, his former son-in-law. It was not necessary to consider the substance of the claim for the purposes of this appeal. LH contended that the money had been paid to Mr Frangos as a loan. Mr Frangos maintained that the sums were paid as a gift. The dispute has been the subject of litigation in this country in which Mr Frangos successfully challenged the jurisdiction of the English courts over the claim. The judgment of the Court of Appeal is reported as Haji-Ioannou v Frangos[1999] CLC 1075. LH Haji-Ioannou then pursued his claim in Greece. The Greek Court of Appeal gave judgment for LH. On 17 November 2008 the Greek Supreme Court heard an appeal by Mr Frangos from the judgment of the Greek Court of Appeal. On 16 February 2009 it dismissed his appeal. The registration of the judgment is a preliminary step in seeking to enforce the judgment in this country. It is apparent from documents placed before the court that enforcement proceedings are also being pursued in New York State.
3. On 13 May 2009 Master Fontaine made the following Registration Order:
“The Judgment of the Court of Appeal of Piraeus of Judges Sarantis Drineas, Maria Galani-Leonardopoulou and Maria Vasdeki of 12 May 2008 in Decision Number 362/2008 between the Plaintiff Loucas Haji-Ioannis c/o Bird & Bird LLP, 15 Fetter Lane London EC4A 1JP and the Defendant Ioannis Frangos of Nyrnfwn 16, Kifissia, Attica Greece. (‘the Judgment’) whereby it was adjudged inter alia that:
(a) The Respondent is indebted to the Applicant in the sum of US$49,035,918.
(b)The Respondent is indebted to the Applicant for legal interest on US$49,035,918 from 4 August 1994 to final settlement which totals as at 7 October 2008 US$57,617,884.70 and which continues to accrue pursuant to Article 8 of the Greek Act of the Council of Ministers number 36/1990.
(c) The Respondent do pay to the Applicant EUR€700,000 in respect of legal costs.
… be registered as a Judgment in the Queen's Bench Division of the High Court of Justice in England pursuant to Council Regulation (EC) 44/2001.'
4. The Regulation provides as follows:
“Article 38
1. A judgment given in a Member State and enforceable in that State shall be enforced in another Member State when, on the application of any interested party, it has been declared enforceable there.
2. However, in the United Kingdom, such a judgment shall be enforced in England and Wales, in Scotland, or in Northern Ireland when, on the application of any interested party, it has been registered for enforcement in that part of the United Kingdom.
Article 42
2. The declaration of enforceability shall be served on the party against...
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