Owens Bank Ltd v Fulvio Bracco and Another ; Case C-129/92

JurisdictionUK Non-devolved
JudgeLord Griffiths,Lord Bridge of Harwich,Lord Ackner,Lord Goff Of Chieveley,Lord Browne-Wilkinson,Lord Goff of Chieveley
Judgment Date19 May 1994
Judgment citation (vLex)[1992] UKHL J0401-2
Date19 May 1994
CourtHouse of Lords
Owens Bank Limited
(Appellants)
and
Fulvio Bracco and Others
(Respondents)
Owens Bank Limited
(Respondents)
and
Fulvio Bracco and Others
(Appellants)
(Conjoined Appeals)

[1992] UKHL J0401-1

Lord Griffiths

Lord Bridge of Harwich

Lord Ackner

Lord Goff of Chieveley

Lord Browne-Wilkinson

House of Lords

Lord Griffiths

My Lords,

1

I have had the advantage of reading in draft the speech prepared by my noble and learned friend, Lord Bridge of Harwich. I agree with it and for the reasons which he gives, I, too, would dismiss the bank's appeal with costs.

Lord Bridge of Harwich

My Lords,

2

These proceedings arise out of an application by Owens Bank Limited ("the bank") to register under section 9 of the Administration of Justice Act 1920 a judgment of the High Court of St. Vincent and the Grenadines dated 29 January 1988 (affirmed by the Court of Appeal of St. Vincent and the Grenadines on 29 December 1989) against Fulvio Bracco and Bracco Industria Chimica S.p.A. ("Bracco" and "Bracco S.p.A.") for a sum in excess of 10 million Swiss Francs. After initial registration on the bank's ex parte application the matter came before Sir Peter Pain, sitting as a High Court Judge in Chambers, on the application of Bracco and Bracco S.p.A. (1) that the registration be set aside or the proceedings stayed pursuant to the provisions of the Civil Jurisdiction and Judgments Act 1982; or alternatively (2) that an issue be tried under section 9(2)(d) of the Act of 1920 as to whether the St. Vincent judgment had been obtained by fraud. Sir Peter Pain heard the two issues separately. He gave judgment on issue (1) in favour of the bank, refusing to set aside the registration or stay the proceedings under the Act of 1982. He gave judgment on issue (2) in favour of Bracco and Bracco S.p.A. ordering that an issue be tried as to whether the St. Vincent judgment had been obtained by fraud. Both parties appealed and both appeals were dismissed by the Court of Appeal (Parker, Balcombe and Ralph Gibson L.JJ.) [1992] 2 W.L.R. 127. Both parties have further appealed by leave of your Lordships' House, but your Lordships determined that the appeal of Bracco and Bracco S.p.A. on issue (1) depends upon questions which it is necessary to refer to the European Court of Justice and accordingly ordered that further proceedings on that appeal be stayed. Thus it is only the appeal of the bank on issue (2) that now falls to be decided.

3

The events leading to the litigation are clearly and succinctly summarised in the judgment of the Court of Appeal, at pp. 132-133, and I gratefully adopt their account which reads:

"The bank's claim in the St. Vincent action was simple but remarkable. It was that, on 31 January 1979, Mr. Armando Nano, the then managing director of the bank and acting on its behalf, had lent to Bracco Industria Chimica S.p.A. the sum of Swiss Fr. 9m., which had then been handed over in cash by Nano to Bracco, who was the president of Bracco Industria Chimica S.p.A. acting on its behalf, or his own behalf. The loan was made, it was said, on terms agreed orally including inter alia, that it should be repayable in three tranches of Swiss Fr. 2m., 3m., and 4m. on 27, 28 and 29 August 1979. This transaction was said to have taken place in the Hotel du Rhône, Geneva, and was sought to be supported by three receipts, four acknowledgements and a letter on Hotel du Rhone paper all of which were said to have been signed by Bracco ('the loan documents'). The documents included provisions that gave the High Court of St. Vincent and the Grenadines jurisdiction in the event of dispute.

Bracco denied the transaction in toto asserting that no loan had been agreed or made, that no cash had been handed over and that the loan documents were forgeries never having been signed by him. Bracco Industria Chimica S.p.A. asserted that if Bracco had entered into any such transaction he had no authority whatsoever to do so.

The bank is a St. Vincent company but Bracco Industria Chimica S.p.A. is an Italian company and Bracco resides in that country. Nano is also an Italian. The jurisdiction of the St. Vincent courts thus rested on the jurisdiction provisions in the loan documents. That jurisdiction was challenged and was decided in favour of the bank by Renwick J. on the hearing of an application to strike out the action for want of jurisdiction. From that decision there was no appeal. The point was sought to be raised again at the trial before Singh J. but he held that the matter had already been determined.

During the course of the bank's case in St. Vincent, the defence admitted that the signatures on the receipts and acknowledgements were the signatures of Bracco. After the bank's case was closed, however, the defence intimated that they wished to set up a new defence, namely, that the signatures on the receipts and acknowledgements were genuine signatures but that they had originally appeared in the wide margins of a contract concerning a wholly different matter, that the margins with the signatures had been cut off and that Nano or someone on his behalf or on behalf of the bank had then typed in the rest of what appeared on the document. The contentions with regard to the letter were more complex but it is not necessary to set them out. Singh J. ruled that the defendants were not entitled to set up this defence at such a late stage and his ruling was upheld on appeal. Singh J. accepted the evidence of Nano and accordingly gave judgment for the bank.

The foregoing is a very much simplified account of the litigation in St. Vincent. It is however sufficient for present purposes. It will be apparent from it that there could be no possibility other than that either Nano or Bracco was committing perjury and trying deliberately to deceive the court. By accepting the evidence of Nano, Singh J. found, in effect, that it was Bracco who was attempting to deceive it.

Before the St. Vincent action was tried, the matter of the genuineness of the loan documents had already been raised elsewhere. Bracco in response to a demand for repayment in November 1980 had stated in a letter of 4 December 1980 that the documents were false and had never been signed by him, and there had been both criminal and civil proceedings in Italy in which the question of fraud had been raised. Between the judgment in the High Court of St. Vincent and the dismissal of the appeal therefrom yet further proceedings had been commenced in Italy including (1) civil proceedings at the suit of both defendants seeking declarations of non-liability to the bank and (2) proceedings by the bank to enforce the St. Vincent judgment. After the St. Vincent appeal was dismissed, yet further proceedings both criminal and civil were commenced in Italy. It is unnecessary to go into the details of any of those proceedings. It is sufficient to say that the issue of fraud is squarely raised but has not yet been decided."

4

Since the judgment of the Court of Appeal was delivered the First Criminal Division of the Milan Civil and Criminal Court has delivered judgment convicting Nano and a co-defendant of certain charges brought against them and holding the loan documents to be forgeries. Nano and the co-defendant were each sentenced to 6 years' imprisonment, but these sentences are suspended pending appeal.

5

Section 9 of the Administration of Justice Act 1920 provides as follows:

(1) Where a judgment has been obtained in a superior court in any part of His Majesty's dominions outside the United Kingdom to which this Part of this Act extends, the judgment creditor may apply to the High Court in England or Ireland, or to the Court of Session in Scotland, at any time within twelve months after the date of the judgment, or such longer period as may be allowed by the court, to have the judgment registered in the court, and on any such application the court may, if in all the circumstances of the case they think it is just and convenient that the judgment should be enforced in the United Kingdom, and subject to the provisions of this section, order the judgment to be registered accordingly.

(2) No judgment shall be ordered to be registered under this section if —

  • (a) the original court acted without jurisdiction; or

  • (b) the judgment debtor, being a person who was neither carrying on business nor ordinarily resident within the jurisdiction of the original court, did not voluntarily appear or otherwise submit or agree to submit to the jurisdiction of that court; or

  • (c) the judgment debtor, being the defendant in the proceedings, was not duly served with the process of the original court and did not appear, notwithstanding that he was ordinarily resident or was carrying on business within the jurisdiction of that court or agreed to submit to the jurisdiction of that court; or

  • (d) the judgment was obtained by fraud; or

  • (e) the judgment debtor satisfies the registering court either that an appeal is pending, or that he is entitled and intends to appeal, against the judgment; or

  • (f) the judgment was in respect of a cause of action which for reasons of public policy or for some other similar reason could not have been entertained by the registering court.

(3) Where a judgment is registered under this section —

  • (a) the judgment shall, as from the date of registration, be of the same force and effect, and proceedings may be taken thereon, as if it had been a judgment originally obtained or entered up on the date of registration in the registering court;

  • (b) the registering court shall have the same control and jurisdiction over the judgment as it has over similar judgments given by itself, but in so far only as relates to execution under this section;

  • (c) the reasonable costs of and incidental to the registration of the judgment (including the costs of obtaining a certified copy thereof from the original court and of the application for...

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