How We Assist Private Clients and Foreign Companies in Enforcing Judgments in Pakistan

At our law firm, we specialise in providing comprehensive legal services to private clients and foreign companies seeking to enforce their judgments in Pakistan. Enforcing foreign judgments in Pakistan involves a detailed understanding of both international and domestic legal frameworks, and our experienced team is equipped to navigate these complexities to secure favourable outcomes for our clients.

Understanding the Legal Framework

Enforcing a foreign judgment in Pakistan primarily involves the provisions of the Civil Procedure Code (CPC), 1908, specifically Sections 13 and 44-A. These sections outline the conditions under which a foreign judgment is recognized and can be executed within Pakistan. Our team is well-versed in these statutory requirements and the relevant case law, ensuring that we can provide precise and effective guidance throughout the enforcement process.

Our Services

  1. Initial Consultation and Case Evaluation We begin with a thorough consultation to understand the specifics of your case. We evaluate the foreign judgment to determine its enforceability under Pakistani law. This includes assessing whether the judgment meets the conditions specified in Section 13, CPC, such as the foreign court’s jurisdiction, the judgment’s finality, and its conformity with Pakistani public policy.
  2. Documentation and Compliance Proper documentation is crucial for enforcing foreign judgments. We assist in obtaining and verifying certified copies of the foreign judgment and its translation, if necessary. We ensure all documents comply with the evidentiary requirements under Pakistani law, including certification by the Consulate General of Pakistan where applicable.
  3. Filing the Suit Depending on the specifics of your case, we file the appropriate suit or application. If the judgment is from a reciprocating territory, we can proceed under Section 44-A, CPC, to directly execute the judgment through the District Court. For judgments from non-reciprocating territories, we file a suit based on the foreign judgment as the cause of action, ensuring it meets the requirements of Section 13, CPC.
  4. Legal Representation Our experienced litigators represent clients in court, presenting compelling arguments and evidence to support the enforcement of the foreign judgment. We handle all aspects of the litigation process, from initial filings to court hearings, ensuring that your case is effectively presented and argued.
  5. Defending Against Collateral Attacks Foreign judgments can be subject to collateral attacks in Pakistani courts, where the defendant might challenge the judgment on grounds such as lack of jurisdiction or fraud. Our team is adept at defending against such attacks, ensuring that the foreign judgment is upheld and enforced.
  6. Execution of Judgments Once the foreign judgment is recognized by the Pakistani court, we assist in the execution process. This involves identifying and attaching the assets of the judgment debtor in Pakistan, and taking all necessary legal steps to ensure the judgment is satisfied.

Enforcing foreign judgments in Pakistan can be a complex and challenging process, requiring expert legal knowledge and strategic execution. At our firm, we leverage our deep understanding of both international and Pakistani legal systems to provide efficient and effective enforcement services. Whether you are a private client or a foreign company, we are committed to helping you achieve your legal and financial objectives in Pakistan.

For more information or to schedule a consultation, please contact our office at aemen@joshandmak.com. We are here to assist you every step of the way, ensuring that your foreign judgment is enforced with precision and professionalism.

Client Information Article: Enforcing Foreign Judgments in Pakistan

At Josh and Mak International, we understand the complexities involved in the enforcement of foreign judgments, which entails recognising and executing judgments or decrees issued by foreign courts within the judicial framework of Pakistan. This process involves two critical steps: recognition and enforcement.

Recognition of Foreign Judgments

For a foreign judgment to be recognised in Pakistan, it must comply with Section 13 of the Civil Procedure Code 1908 (CPC). This section stipulates that a foreign judgment is conclusive regarding any matter adjudicated upon between the same parties, provided it does not fall under the exceptions listed in Section 13:

  1. The judgment must be pronounced by a court of competent jurisdiction.
  2. The judgment must be given on the merits of the case.
  3. It should not appear, on the face of the proceedings, to be founded on an incorrect view of international law or a refusal to recognise Pakistani law where applicable.
  4. The proceedings must not be opposed to natural justice.
  5. The judgment must not have been obtained by fraud.
  6. The judgment should not sustain a claim founded on a breach of any law in force in Pakistan.

Once recognised under these parameters, a foreign judgment is treated as equivalent to a domestic judgment.

Enforcement of Foreign Judgments

Foreign judgments based on awards are excluded from the definition of a decree and are not executable under Section 44-A of the CPC. Instead, the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011, governs the enforcement of arbitral agreements and awards.

Scope of Enforcement in Pakistan

The enforcement of foreign judgments in Pakistan is generally governed by principles of reciprocity. If the country issuing the judgment does not recognise Pakistani judgments, Pakistani courts will not enforce the foreign judgment directly. Instead, such judgments can serve as conclusive evidence for determining the rights between parties and form the basis for filing a new suit in Pakistan.

There are three primary methods for executing rights under a foreign judgment in Pakistan:

  1. Direct Execution under Section 44-A of the CPC: This applies if the judgment is from a country notified as a reciprocating territory in the Official Gazette of Pakistan.
  2. Filing a Suit Using the Foreign Judgment as a Cause of Action: This is governed by Article 117 of the Limitation Act, 1908.
  3. Filing a Fresh Suit on the Original Cause of Action.

Enforcement under the Civil Procedure Code, 1908

A decree holder can directly execute their rights by submitting a certified copy of the foreign judgment to the District Courts. The decree is then treated as if it were issued by a Pakistani court, provided it comes from a superior court in a reciprocating territory. Notable reciprocating territories include the United Kingdom, Fiji, Singapore, New Zealand, and several others.

Judgments from non-reciprocating territories must be enforced through the other two methods mentioned above.

Applicability and Restrictions

Section 44-A exclusively applies to money decrees, excluding those related to taxes, fines, penalties, costs, and arbitration awards. Once the necessary conditions are met, and the certified copy is filed, the foreign judgment is examined under Section 13 of the CPC. This involves ensuring that none of the exceptions to conclusiveness apply.

Competence of Foreign Courts

The competency of a foreign court is presumed under Section 14 of the CPC unless proven otherwise. The foreign court’s jurisdiction must cover the subject matter or the defendant, who must reside within the foreign territory issuing the judgment.

Issuance of Notices

Once the court confirms that the foreign judgment meets the criteria under Section 13, it issues notices to the judgment debtor to show cause why execution should not proceed.

Enforcement of Non-Reciprocating Judgments

Judgments from non-reciprocating territories can be enforced by filing a suit in Pakistan, treating the judgment as a cause of action, or by initiating a fresh suit on the original cause of action, provided the judgment meets the requirements of Section 13.

At Josh and Mak International, we ensure our clients are well-informed and actively involved in the enforcement process. We leverage our expertise to navigate the complexities of international judgment enforcement, ensuring a strategic and effective approach.

Client Information Article Continues below: 

The enforcement of foreign judgments in Pakistan is governed by a complex interplay of provisions under the Civil Procedure Code (CPC), 1908, and the Qanun-e-Shahadat Order, 1984. Notably, Sections 13 and 44-A of the CPC set the foundational principles for recognizing and executing foreign judgments.The provisions of the Civil Procedure Code concerning foreign judgments, specifically Sections 13 and 14, outline the conditions under which a foreign judgment is considered conclusive and the presumptions regarding its jurisdiction.

Section 13 establishes that a foreign judgment is conclusive regarding any matter directly adjudicated upon between the same parties, or parties under whom they or any of them claim litigating under the same title. However, this conclusiveness is subject to several exceptions:

(a) Lack of Competent Jurisdiction: If the foreign judgment was not pronounced by a court with competent jurisdiction, it will not be considered conclusive. Competent jurisdiction means the court must have the legal authority to hear and decide the case.

(b) Merits of the Case: The judgment must be given on the merits of the case. If the judgment was not based on the substantive issues in dispute, but rather on procedural grounds, it will not be conclusive.

(c) Incorrect View of International Law or Pakistani Law: If it is evident on the face of the proceedings that the judgment is based on an incorrect understanding of international law or a refusal to recognize Pakistani law where it is applicable, the judgment will not be conclusive.

(d) Opposed to Natural Justice: The proceedings leading to the judgment must adhere to the principles of natural justice. If the judgment was obtained in a manner contrary to these principles, such as without fair hearing or due process, it will not be conclusive.

(e) Obtained by Fraud: Any judgment obtained by fraud is not conclusive. Fraud undermines the integrity of the judicial process, and thus, a judgment procured by fraudulent means cannot be upheld.

(f) Breach of Pakistani Law: If the judgment sustains a claim founded on the breach of any law in force in Pakistan, it will not be conclusive.

Section 14 deals with the presumption of jurisdiction regarding foreign judgments. It states that the court shall presume, upon the production of any document purporting to be a certified copy of a foreign judgment, that such judgment was pronounced by a court of competent jurisdiction. This presumption stands unless the contrary is shown on the record. However, this presumption can be rebutted by proving a lack of jurisdiction. Essentially, this means that there is an initial assumption of jurisdictional competence unless evidence is presented to challenge this presumption.

In summary, while Section 13 sets forth the criteria and exceptions for a foreign judgment to be considered conclusive, Section 14 provides a procedural presumption in favour of the jurisdiction of the foreign court, which can be contested with sufficient proof. These provisions ensure that foreign judgments are respected and enforced, provided they meet certain standards of fairness, competence, and adherence to applicable laws.

The provision of the Civil Procedure Code (CPC) section 44A outlines the framework for the execution of foreign judgments and decrees in Pakistan, specifically those from the superior courts of the United Kingdom or any reciprocating territory. This section essentially provides a mechanism for such foreign judgments to be recognized and enforced within Pakistan’s judicial system.

1. Filing and Execution of Foreign Decrees: Subsection (1) stipulates that a certified copy of a decree from any superior court of the United Kingdom or a reciprocating territory, when filed in a District Court in Pakistan, shall be treated as if it were a decree passed by that District Court. This means that once the foreign decree is duly filed, it can be executed in Pakistan in the same manner as a local decree.

2. Requirement of Satisfaction Certificate: Subsection (2) mandates that along with the certified copy of the decree, a certificate from the superior court must be filed. This certificate must state the extent to which the decree has been satisfied or adjusted. For the purposes of the execution proceedings, this certificate is conclusive proof of the satisfaction or adjustment of the decree, thereby providing a clear and definitive statement on what portion of the decree remains outstanding.

3. Application of Section 47 and Grounds for Refusal: Subsection (3) specifies that the provisions of section 47 of the CPC, which deals with questions to be determined by the court executing a decree, will apply to the proceedings in a District Court executing a foreign decree under this section. Moreover, the District Court is required to refuse execution of any such decree if it falls within any of the exceptions enumerated in clauses (a) to (f) of section 13 of the CPC. These exceptions include:

  • Lack of competent jurisdiction by the foreign court.
  • Judgment not given on the merits.
  • Judgment based on an incorrect view of international law or refusal to recognize applicable Pakistani law.
  • Proceedings opposed to natural justice.
  • Judgment obtained by fraud.
  • Judgment sustaining a claim founded on a breach of Pakistani law.
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4. Definitions and Clarifications:

  • Explanation 1: Defines “Superior Court” with respect to the United Kingdom to include specific courts such as the High Court in England, the Court of Session in Scotland, and others.
  • Explanation 2: Defines “reciprocating territory” and the “superior courts” within those territories, as notified by the Central Government of Pakistan.
  • Explanation 3: Clarifies the meaning of “decree” for the purposes of this section, specifically excluding sums payable in respect of taxes, fines, penalties, and arbitration awards.

Omitted Provision:

  • Section 45, which dealt with the execution of decrees in foreign territories, has been omitted by an ordinance.

In summary, section 44A of the CPC facilitates the recognition and enforcement of certain foreign judgments within Pakistan, subject to specific procedural requirements and exceptions. This provision underscores the principle of reciprocity and ensures that foreign judgments are scrutinized to safeguard against potential injustices or conflicts with local laws.

Analysis of Case law :

The recognition and enforcement of foreign judgments in Pakistan is governed by Section 13 of the Civil Procedure Code (CPC), 1908. This section outlines the conditions under which a foreign judgment is considered conclusive and enforceable. The legal framework ensures that foreign judgments are not automatically enforceable but subject to scrutiny under specific conditions.

According to the landmark case of Namooz Zaheer v. Azfar Hasnain, 2023 PLD 220 Islamabad, the court emphasised that a judgment pronounced by a foreign court in a personal action in absentia, where the absent party has submitted to the jurisdiction of such court, is not a nullity but enforceable. However, the judgment-debtor is entitled to raise all defences under Section 13, CPC. This case reinforces the principle that unless the party against whom a foreign judgment is sought to be enforced voluntarily and effectively submits to the jurisdiction of the foreign court and contests the claim, the judgment cannot be relied upon in Pakistan.

The same citation also elaborates on the procedural requirements for the execution of a foreign judgment. In another aspect of the same case, it was highlighted that the production of a photocopy of the foreign judgment without the original or a certified copy, accompanied by a notary public or Pakistan Consul certificate, does not meet the evidentiary standards under Articles 89(5) and 96(1) of the Qanun-e-Shahadat Order, 1984. Despite the procedural lapses, if the appellant fails to object to the authenticity of the copy during the hearing and has previously admitted the judgment’s existence in Pakistani courts, estoppel under Article 114 of the Qanun-e-Shahadat, 1984, would apply, preventing the appellant from resisting enforcement.

In interpreting the scope of “foreign judgment” and “foreign court,” Section 2(6) and Section 2(5) of the CPC define these terms, with a foreign judgment being one pronounced by a court outside Pakistan’s territorial limits and not established by the Federal Government. A foreign judgment becomes conclusive under Section 13, CPC, unless it falls within one of the exceptions outlined in clauses (a) to (f). These exceptions allow for a collateral attack on the judgment if it is found to be tainted by fraud, jurisdictional errors, or contrary to Pakistani law and natural justice.

In another significant case, Mena Energy DMCC v. Hascol Petroleum Limited, 2022 PLD 388 Karachi High Court, the court addressed the issue of executing foreign decrees under Sections 13 and 44-A, CPC, alongside the Foreign Exchange Regulation Act, 1947. The court clarified that a foreign decree, once deemed conclusive under Section 13, CPC, and executable under Section 44-A, can be enforced by attaching and selling the local assets of the judgment debtor. The judgment also discussed the need for compliance with the Foreign Exchange Regulation Act, 1947, ensuring that the proceeds from such executions are appropriately converted and transferred abroad following Pakistani laws.

Furthermore, the case of Tenedos Denizcilik ve Tic. Ltd. v. Makhamet, 2022 PLD 378 Karachi High Court, illustrated the application of the res judicata principle to foreign judgments. The court held that a foreign judgment meeting the conclusiveness criteria under Section 13, CPC, could invoke res judicata, preventing the re-litigation of the same matter already adjudicated by a competent foreign court.

The case of Mst. Abida Zakir alias Aubaida Zakir v. Raja Aman Ullah Khan, 2022 PLD 54 Islamabad, further reinforced that the binding nature of a foreign judgment could only be displaced by proving one of the exceptions in Section 13, CPC. The courts in Pakistan are not to reassess the evidence or correctness of the foreign court’s conclusions but only to ensure compliance with the statutory conditions.

In terms of procedural reciprocity, the case involving the Letter of Administration of Deceased Tahir Ahmed Khan, 2019 PLD 130 Karachi High Court, dealt with the cross-border enforcement of succession orders. The court recognised the arrangements for reciprocity with the United Kingdom and the United Arab Emirates, allowing Pakistani court orders to be enforceable in these jurisdictions and vice versa, particularly in non-contentious matters.

Lastly, the Supreme Court of Azad Kashmir, in Yasir Bashir v. Saba Yasir, 2019 PLD 9, highlighted the necessity for reciprocal arrangements between Pakistan and Azad Jammu and Kashmir for the execution of family court decrees. The absence of such arrangements leads to procedural challenges, necessitating legislative or administrative solutions for seamless enforcement.

The attitude of Pakistani courts towards foreign judgments is one of cautious acceptance, ensuring that such judgments comply with domestic laws and procedural requirements. This approach aims to balance the principles of international comity with the protection of local legal standards and parties’ rights. The cases cited illustrate a consistent judicial effort to uphold these principles while addressing the complexities of cross-border legal matters

The landmark case of Dr. Sajjad Haider Shami v. Mst. Sadaf Pervaiz, 2019 CLC 562 Lahore High Court, elucidates the judiciary’s approach towards foreign judgments and underscores the principles of jurisdiction and applicability of foreign laws.

In this case, Dr. Sajjad Haider Shami, a UK national, challenged a judgment passed in the UK, arguing that since both parties were originally Pakistani citizens and their marriage was solemnised under the Muslim Family Laws Ordinance, 1965, the applicable law should have been Pakistani law, not UK law. The court, however, held that having acquired UK nationality, the parties were subject to UK laws, and the jurisdiction of the UK courts could not be curtailed merely based on their origin. The plaintiff failed to establish any of the exceptions under Section 13, CPC, which would render the foreign judgment non-conclusive. Consequently, the Lahore High Court declined to exercise its revisional jurisdiction, affirming the concurrent findings of fact and law against the plaintiff.

This case highlights a crucial aspect of the enforcement of foreign judgments: the principle of jurisdiction. Once parties have submitted to the jurisdiction of a foreign court, they cannot later contest that jurisdiction to evade an unfavourable judgment. This principle aligns with the doctrine of judicial comity, where courts in one jurisdiction give effect to the laws and judicial decisions of another, provided certain conditions are met.

Similarly, in the case of Saba Yasir v. Senior Civil Judge, Muzaffarabad, 2018 PLD 25 High Court Azad Kashmir, the court addressed the execution of decrees passed by Pakistani courts in Azad Jammu and Kashmir (AJK). The court noted that while the Family Courts Act of AJK did not provide specific procedures for executing foreign decrees, the inherent powers of the court could be exercised in the interest of justice. The court affirmed that decrees passed by Pakistani courts could be executed in AJK under Section 13 of the CPC, provided the defendant had voluntarily submitted to the jurisdiction of the foreign court. The judgment-debtor in this case had appeared voluntarily before the foreign court, and hence, could not later impeach the judgment on jurisdictional grounds.

The application of Section 13, CPC, was further illustrated in Wali Khan v. Ali Muhammad, 2017 PLD 1 Peshawar High Court, where the court explained that foreign judgments are conclusive and enforceable in Pakistan unless they fall under the exceptions enumerated in Section 13. These exceptions include judgments obtained by fraud, judgments passed by courts without competent jurisdiction, and judgments contrary to public policy, among others. The court emphasized that it could not question the correctness of a foreign judgment unless one of these exceptions was proven.

Another notable case, Muhammad Ramzan (Deceased) v. Nasreen Firdous, 2016 PLD 174 Supreme Court, reaffirmed that Pakistani courts must respect and enforce foreign judgments under the principle of judicial comity. However, before enforcing such judgments, courts must ensure that they do not fall within the exceptions outlined in Section 13, CPC. This principle is grounded in the broader context of international law, where judicial decisions from one jurisdiction are given due respect and recognition in another, facilitating cross-border legal coherence and predictability.

Moreover, the Supreme Court in Nadeem Farooq v. Newze Land Electronic Trading Co. Lee Sharja, 2017 PLD 95, dealt with the execution of a decree passed by a court in the United Arab Emirates (UAE). The court clarified that only decrees from superior courts of reciprocating territories, as notified under Section 44-A, CPC, are directly executable in Pakistan. Decrees from other foreign courts must undergo the process outlined in Section 13, CPC, to determine their enforceability.

In conclusion, the judiciary in Pakistan adopts a nuanced approach towards foreign judgments, balancing the principles of judicial comity and national legal standards. The enforcement of such judgments hinges on the satisfaction of procedural and substantive conditions under Section 13, CPC. This ensures that while foreign judgments are respected, they are not enforced blindly, thereby safeguarding the legal rights and interests of parties within the Pakistani jurisdiction. The cited cases collectively underscore the judiciary’s commitment to maintaining this delicate balance, providing clarity and consistency in the enforcement of foreign judgments.

In Syed Jaffer Abbas v. Habib Bank Limited, the Karachi High Court clarified that Sections 13 and 44-A of the CPC are not independent but are intrinsically linked. This interconnection signifies that even a final judgment from a foreign court, approved by an appellate court in a country with an international treaty with Pakistan, cannot be executed directly without satisfying the exceptions outlined in Section 13, CPC. The court stressed that a foreign judgment can be refused execution in Pakistan if it falls within any of the exceptions listed in Section 13, CPC. This ensures that no foreign judgment or decree can be executed solely based on Section 44-A, CPC, without recourse to and compliance with Section 13, CPC.

In another notable instance within the same case, the court addressed the application of interrogatories under Order XI, Rule 2 of the CPC. The defendant’s application to administer interrogatories on the plaintiff was dismissed, highlighting that matters adjudicated by foreign courts are conclusive and cannot be reopened except under the exceptions provided by Section 13, CPC. The court maintained that interrogatories aimed at ascertaining facts were not applicable in a suit based on a foreign judgment and decree under Section 13, CPC. This decision underscores the finality and definitiveness of foreign judgments, subject to the exceptions in Section 13, CPC, and limits the scope of factual scrutiny in such cases.

The case of Dr. Viktor Hacker v. Dr. Shahida Mansoor, 2013 PLD 34 Islamabad, further exemplifies the application of Section 13, CPC, in the context of foreign custody judgments. Here, the Islamabad High Court dealt with a habeas corpus petition filed by a father seeking the recovery of his minor children, for whom sole custody had been granted to him by a foreign court. The mother, having brought the children to Pakistan, contended that the foreign judgment was not conclusive as it was passed in her absence and was still under appeal in the foreign court. The court held that the judgment was not conclusive under Section 13(b), CPC, as it was not delivered on merits and was under appeal, thus dismissing the petition and suggesting the father approach the Guardian Judge for custody proceedings in Pakistan. This case highlights the necessity for foreign judgments to be conclusive and final before being recognized and enforced in Pakistan.

The enforcement of foreign judgments is further delineated in Habib Bank Limited v. Syed Jaffar Abbas, 2012 CLC 704 Karachi High Court, where the court addressed the delivery of interrogatories in a suit for the recovery of a bank loan based on a foreign decree. The court reiterated that interrogatories relating to evidence to be led by the plaintiff were not permissible, and such questions should be addressed during the trial, if the plaintiff chose to lead evidence on the original cause of action. This case reinforces the procedural boundaries within which foreign judgments are treated and the limited scope for reopening factual determinations already settled by foreign courts.

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In the broader context of judicial comity, the principle that foreign judgments are generally respected and enforced, subject to exceptions, was underscored in the case of Shahid Siddique v. Sharja National Travels and Tourist Agency, 2011 PLD 620 Lahore High Court. The court noted that foreign judgments must be treated as conclusive under Section 13, CPC, unless falling within specific exceptions. Additionally, the Lahore High Court highlighted the necessity of reciprocal treaties for the direct execution of foreign decrees under Section 44-A, CPC.

The procedural nuances of executing foreign judgments were also addressed in Wali Khan v. Ali Muhammad, 2017 PLD 1 Peshawar High Court, where the court outlined the three possible courses of action available to a plaintiff holding a foreign judgment: proceeding under Section 44-A, CPC, filing a suit on the basis of the foreign judgment as a cause of action, or filing a suit on the original cause of action. The court reiterated that foreign judgments must comply with Section 13, CPC, to be enforceable, ensuring that they do not fall within any of the exceptions.

 The case of Habib Bank Limited v. Bahjani Scrap Trading Company LLC, 2011 CLD 733 Karachi High Court, provides a critical examination of these provisions and their application in the context of a foreign judgment.

In this case, Habib Bank Limited filed a recovery suit against Bahjani Scrap Trading Company LLC based on a judgment and decree passed by a foreign court. The primary issue before the Karachi High Court was whether the foreign judgment could be treated as a valid cause of action for initiating proceedings in Pakistan. The court reiterated that there is nothing in Section 13 of the CPC that excludes the provisions of the Financial Institutions (Recovery of Finances) Ordinance, 2001. Thus, a plaintiff can file a suit on the basis of a foreign judgment treating it as a cause of action, which was duly adhered to in this case.

The Karachi High Court emphasized that Sections 13 and 44-A of the CPC are not independent but interlinked. Section 13 outlines the conditions under which a foreign judgment is deemed conclusive, subject to exceptions such as fraud, lack of jurisdiction, or being contrary to Pakistani public policy. Section 44-A, on the other hand, allows for the direct execution of foreign judgments from reciprocating territories without the need to re-litigate the merits of the case, provided they comply with Section 13.

In the case at hand, Habib Bank Limited successfully filed certified copies of the foreign judgment and its translation, duly attested by the Consulate General of Pakistan, as required under Article 96 of the Qanun-e-Shahadat, 1984. The defendant did not file an application for leave to defend the suit, leading the court to decree the suit in favour of the plaintiff. This outcome highlights the importance of proper documentation and adherence to procedural requirements in the enforcement of foreign judgments.

The judgment further clarified that once a foreign judgment is presented, it must be scrutinized to ensure it does not fall within the exceptions provided under Section 13. This includes verifying that the foreign court had proper jurisdiction, that the judgment was not obtained through fraud, and that it does not violate public policy. If these conditions are satisfied, the judgment is considered conclusive and binding between the parties.

Another aspect of the enforcement process discussed in this case is the limitation period. According to Article 117 of the Limitation Act, 1908, a suit based on a foreign judgment must be filed within six years from the date the judgment becomes final. This principle ensures that the judgment creditor acts within a reasonable time to enforce their rights.

In the broader context, the case of Habib Bank Limited v. Azam Majeed, 2011 CLD 963 Lahore High Court, reinforces these principles by highlighting that a foreign judgment, once validated under Section 13, can be executed under Section 44-A if it is from a reciprocating territory. The judgment must have attained finality, meaning it is no longer subject to appeal in the originating country. The court underscored the importance of the finality of judgments to prevent multiple litigations and ensure judicial efficiency.

Furthermore, the case of Muhammad Rasheed Hassan v. State, 2010 PCrLJ 1902 Karachi High Court, discussed the principle of autrefois acquit, which protects individuals from being tried or punished more than once for the same offense. This principle was applied in the context of foreign judgments to prevent the National Accountability Bureau (NAB) from prosecuting an individual already exonerated by a competent foreign court.

Pakistani courts adopt a balanced and rigorous approach towards the enforcement of foreign judgments, ensuring they comply with domestic legal standards while respecting international judicial decisions. The interdependence of Sections 13 and 44-A of the CPC provides a robust framework for this process, ensuring foreign judgments are scrutinized for jurisdictional validity, absence of fraud, and compliance with public policy before being enforced. The cited cases collectively illustrate the judiciary’s commitment to maintaining this balance, providing clarity and consistency in the recognition and enforcement of foreign judgments in Pakistan.

The landmark case of Naeemullah Malik v. United Bank Limited, 2006 CLD 1592 Lahore High Court, provides an incisive analysis of the procedural and substantive requirements for enforcing foreign judgments within Pakistan.

In Naeemullah Malik v. United Bank Limited, the Lahore High Court addressed the critical issue of executing a judgment passed by a foreign court in Pakistan. The plaintiff, United Bank Limited, sought to recover a loan amount based on a decree obtained from a court in Dubai. The judgment was initially passed in absentia, leading to a suit filed in Pakistan to recover the decretal amount.

The court underscored that upon obtaining a foreign judgment, the decree-holder has three primary courses of action:

  1. Proceeding under Section 44-A, CPC: If the foreign decree is obtained from a court in the United Kingdom or any other reciprocating territory, the decree-holder can seek execution directly through the District Court in Pakistan without filing a fresh suit. This mechanism, however, does not bypass the scrutiny mandated by Section 13, CPC.
  2. Filing a suit based on the foreign judgment: The foreign judgment can be treated as a cause of action. The suit filed on this basis must comply with the conditions prescribed in Section 13, CPC, which ensures the judgment is conclusive between the parties unless it falls within specified exceptions such as lack of jurisdiction, fraud, or being contrary to public policy. This suit must be filed within six years from the date of the foreign judgment as stipulated by Article 117 of the Limitation Act, 1908.
  3. Filing a suit on the original cause of action: The original cause of action remains intact despite the passing of the foreign judgment. This allows the decree-holder to pursue the original claim, subject to the usual procedural requirements.

In this case, the Lahore High Court elucidated that the conditions outlined in Section 13, CPC, must be met for the foreign judgment to be deemed conclusive. These conditions include the foreign court having proper jurisdiction, the judgment being on the merits, and not being obtained through fraud or being contrary to public policy. If these conditions are not met, the foreign decree remains susceptible to collateral attack in Pakistan.

The court also highlighted the principle of res judicata, noting that if the conditions of Section 13, CPC, are satisfied, the foreign judgment is conclusive and binding between the parties, thereby precluding re-litigation of the same issues in Pakistan. This principle ensures judicial efficiency and respects the finality of judgments.

Furthermore, the court addressed the issue of limitation, emphasizing that a suit based on a foreign judgment must be filed within six years from the date the judgment becomes final. This provision aims to prevent undue delays and encourages prompt enforcement of rights.

In the context of the Financial Institutions (Recovery of Finances) Ordinance, 2001, the court clarified that the procedural requirements under Section 13, CPC, do not exclude the application of this Ordinance. This ensures that financial institutions can effectively recover loans based on foreign judgments, provided the judgments comply with Pakistani legal standards.

The case of Naeemullah Malik v. United Bank Limited underscores the meticulous approach adopted by Pakistani courts towards the enforcement of foreign judgments. By ensuring compliance with Section 13, CPC, the judiciary balances the principles of international comity with the protection of domestic legal standards. This approach not only respects the finality of foreign judgments but also safeguards the rights and interests of parties within the Pakistani legal framework.

Enforcement of Foreign Judgments in Pakistan: A Guide for Private Clients and Foreign Companies

Enforcing foreign judgments in Pakistan can be a complex process, governed by specific legal frameworks and procedural requirements. Understanding these intricacies is essential for private clients and foreign companies seeking to enforce their judgments effectively. This guide provides a comprehensive overview of the enforceability of foreign judgments in Pakistan, the procedures involved, and the potential challenges.

Categories of Foreign Judgments

In Pakistan, foreign judgments are categorized into two types:

  1. Judgments from Reciprocating States: These are countries designated by the Government of Pakistan as reciprocating territories. Judgments from these states are enforceable per se under Section 44-A of the Civil Procedure Code (CPC), 1908.
  2. Judgments from Non-Reciprocating States: For these judgments, the judgment creditor must file a suit in the appropriate Pakistani court to seek enforcement.

Options for Enforcement

A creditor holding a foreign judgment has three primary options for enforcement in Pakistan:

  1. Direct Execution: If the judgment is from a reciprocating state, the creditor can seek direct execution under Section 44-A, CPC. This process involves submitting the judgment to the District Court of the relevant district in Pakistan.
  2. Filing a Suit Based on the Foreign Judgment: The creditor can treat the foreign judgment as a cause of action and file a suit in Pakistan. This requires satisfying the conditions of Section 13, CPC, which ensures the judgment’s conclusiveness between the parties.
  3. Filing a Suit on the Original Cause of Action: The creditor can also choose to file a suit based on the original cause of action underlying the foreign judgment. This option remains available until the foreign judgment is satisfied.

Grounds for Challenging Enforcement

Enforcement proceedings in Pakistan can be challenged on specific grounds set out in Section 13, CPC. These include:

  1. Lack of jurisdiction by the foreign court.
  2. Judgment not given on the merits of the case.
  3. Judgment founded on an incorrect view of international law or refusal to recognize the law of Pakistan.
  4. Proceedings contrary to natural justice.
  5. Judgment obtained by fraud.
  6. Judgment sustaining a claim founded on a breach of any law in force in Pakistan.

Frequently Asked Questions

  1. How is a foreign judgment domesticated in Pakistan? For judgments from non-reciprocating states, a suit must be filed in the appropriate Pakistani court to execute the judgment.
  2. What is the process for seizing the debtor’s assets once the judgment is domesticated? Upon filing the suit, the defendant must furnish security to contest the suit. If security is not furnished, the court can order the seizure of the debtor’s assets.
  3. Which assets are exempt from seizure? Property not in the debtor’s possession cannot be seized but can be attached until execution proceedings are resolved.
  4. Can the debtor’s bank accounts in Pakistan be seized? Yes, bank accounts directly in the debtor’s name can be seized.
  5. How long does the domestication process take? The process duration varies, depending on the court’s schedule and the complexity of the case.
  6. How long after domestication does asset seizure occur? If objections are resolved promptly, asset seizure can occur immediately.

Case Study: Munawar Ali Khan v. Marfani & Co

In the landmark case of Munawar Ali Khan v. Marfani & Co (PLD 2003 Karachi 382), the Karachi High Court addressed critical issues related to the execution of foreign judgments. The court considered whether a decree passed by a foreign court could be executed under Section 44-A of the CPC, even if the defendants were not physically present or had not submitted to the jurisdiction of the foreign court.

The court ruled that the foreign court must have international competence, meaning the defendant must have had a habitual residence in the state of the court at the time proceedings were instituted, or the defendant must have agreed to the court’s jurisdiction. The case highlighted the necessity of fulfilling procedural requirements and ensuring natural justice in enforcing foreign judgments.

See also  LLP Registration in Pakistan

Client Information Article: Difficulties in Enforcing Foreign Judgments in Pakistan

Enforcing foreign judgments in Pakistan can pose significant challenges, particularly for parties outside of the jurisdiction, such as in the United Kingdom. While the UK and Pakistan have reciprocal arrangements regarding the enforcement of judgments, practical difficulties often arise. Here is a detailed analysis based on common questions and issues faced in such cases.

Ease or Difficulty of Enforcement

Enforcing a foreign judgment in Pakistan is fraught with procedural and practical hurdles. Although Pakistan is a party to reciprocal enforcement agreements, the actual implementation of these agreements can be inconsistent and protracted. The process often requires navigating a complex legal framework and can be influenced by various factors, including the cooperation of the defendant.

Procedure and Rules for Enforcement

The enforcement of foreign judgments in Pakistan is governed by the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011, and relevant provisions in the Code of Civil Procedure, 1908. The procedure involves filing a petition in the relevant civil court, accompanied by a certified copy of the judgment and proof that the judgment is final and conclusive. The court then issues a notice to the judgment debtor, who may contest the enforcement on various grounds.

Cooperation of the Losing Party

The success of enforcement often hinges on the cooperation of the judgment debtor. If the debtor fails to cooperate, it can significantly delay the process. In cases of non-cooperation, the court may require additional legal measures, such as contempt proceedings or orders to compel disclosure of assets.

Tracing Debtor’s Assets

Tracing a debtor’s assets in Pakistan can be particularly challenging. Due to the prevalence of benami transactions, where assets are held in the name of third parties, identifying the true ownership of assets can be difficult. This lack of transparency can impede the enforcement process, as debtors may claim that assets are not theirs.

Duration of the Procedure

The enforcement process in Pakistan can be lengthy. From the initiation of proceedings to the final enforcement order, it can take several months to years, depending on the complexity of the case and the level of cooperation from the judgment debtor.

Non-appearance and Non-cooperation of Defendants

If assets cannot be traced and the defendant fails to appear in court or refuses to cooperate, the enforcement process becomes even more protracted. The court may issue ex parte orders, but the actual recovery of assets can still be difficult without the debtor’s cooperation.

Costs Involved

The costs of bringing enforcement proceedings in Pakistan can be substantial. Legal fees, court fees, and other related expenses can add up, and the total cost will depend on the complexity of the case and the duration of the proceedings.

Case Example: English Cricket Board’s Attempt

A notable example of the difficulties faced in enforcement is the English Cricket Board’s (ECB) attempt to enforce costs orders in Sindh against Pakistani cricketer Danish Kaneria. Despite the legal grounds, the ECB faced significant challenges, and the outcome serves as a cautionary tale for foreign parties seeking enforcement in Pakistan.

Chances of Success

Given the complexities involved, the chances of successfully enforcing  something like a costs order in Pakistan are uncertain. The ease with which parties can be manipulated or assets concealed reduces the likelihood of straightforward enforcement. It is crucial to provide objectively justified grounds relating to the obstacles to or the burden of enforcement in the context of the claimant or country concerned, as established in the case of Nasser v United Bank of Kuwait [2002] 1 WLR 1868.

In conclusion, while it is legally possible to enforce foreign judgments in Pakistan, the process is often challenging and fraught with difficulties. Parties seeking enforcement must be prepared for a potentially lengthy and costly legal battle, with no guarantee of success.

Conclusion

Enforcing foreign judgments in Pakistan requires a nuanced understanding of legal principles and procedural requirements. Our firm specializes in navigating these complexities, offering expert legal services to private clients and foreign companies. We provide tailored strategies to ensure the effective enforcement of foreign judgments, safeguarding your legal and financial interests in Pakistan.

For more information or to schedule a consultation, please contact us. Our experienced legal team is here to assist you at every step, ensuring your foreign judgment is enforced with precision and professionalism.

Q and A on Enforcing Foreign Judgements Against States (Cross border Matters)

  1. What are the basic criteria for the courts of Pakistani jurisdiction to allow enforcement of a foreign judgment?

In order for a foreign judgment to be recognised in Pakistan, it must comply with the provisions of Section 13 of the Civil Procedure Code 1908 (CPC), which states:

“A foreign judgment shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title, except: (a) where it has not been pronounced by a Court of competent jurisdiction; (b) where it has not been given on the merits of the case; (c) where it appears on the face of the proceedings to be founded on an incorrect view of international law or a refusal to recognise the law of Pakistan in cases in which such law is applicable; (d) where the proceedings in which the judgment was obtained are opposed to natural justice; (e) where it has been obtained by fraud; (f) where it sustains a claim founded on a breach of any law in force in Pakistan.”

Section 13 of the CPC thus grants statutory recognition to foreign judgments, making them conclusive unless any of the exceptions (a) to (f) apply.

Additionally, Section 44A of the CPC allows for the enforcement of foreign judgments rendered by courts in reciprocating territories, as notified by the Government of Pakistan. Such judgments are treated as if they were rendered by a court in Pakistan. The High Court of Justice in England is a recognised reciprocating court under Section 44A, and a money judgment from this court, subject to the exceptions in Section 13, can be enforced as a local judgment in Pakistan.

  1. What other considerations may apply to the enforcement of a foreign judgment against a state in Pakistan such as notice provisions?

In the case of Emirates Bank International Ltd v Messrs Osman Brothers (MLD 1990, p. 1,779), the court identified three avenues available to a foreign judgment or decree holder:

  1. Executing the foreign judgment under Section 44A of the CPC, if the judgment is from a reciprocating territory.
  2. Filing a suit in Pakistan based on the foreign judgment, treating it as the cause of action, provided the conditions of Section 13 CPC are met.
  3. Filing a suit in Pakistan on the original cause of action.

For instituting proceedings against a state, any notice or document required must be transmitted through the Ministry of Foreign Affairs of Pakistan to the Ministry of Foreign Affairs of the concerned state, and is deemed served when received by the latter.

  1. Can courts in Pakistan enforce a final judgment awarding costs?

In the case of Inam ur Rehman and another v Habib Bank Ltd (CLC 1985, p. 296), it was determined that:

  1. Section 44A of the CPC allows execution of foreign decrees involving a sum of money, but excludes amounts related to “taxes or charges of a like nature.”
  2. Costs are considered within the ambit of “taxes or other charges of a like nature.”
  3. Consequently, a decree awarding costs is not a money decree and cannot be executed under Section 44A of the CPC.

Therefore, costs awarded under a judgment cannot be executed under Section 44A of the CPC.

  1. Can a foreign judgment given in default by a foreign court be enforced in Pakistan?

According to Section 13 of the CPC, only those foreign judgments that are given on merits can be enforced in Pakistan. This principle was affirmed in Abdul Ghani v Haji Saleh Mohammad (PLD 1960 Karachi, p. 594) and Habib Bank Ltd. Through Assets Management (ARM) International Division v Muhammad Naveed Soomar and others (CLD 2009, p. 354). The court categorised ex parte judgments into three types:

  1. Judgments where a defence is struck out and given without judicial consideration of the claimant’s evidence.
  2. Judgments where no defence is filed, given under summary procedure without regard to the claimant’s evidence.
  3. Judgments where no defence is pleaded but the claimant’s evidence is considered.

Only the third category constitutes a judgment on merits, which can be enforceable in Pakistan.

  1. What special considerations apply where the defendant/debtor in enforcement proceedings is a state, such as the doctrine of sovereign immunity?

Under the State Immunity Ordinance 1981, states are generally immune from the jurisdiction of Pakistani courts except in specific circumstances such as:

  • Submission to jurisdiction;
  • Commercial transactions and contracts performed in Pakistan;
  • Contracts of employment;
  • Ownership or use of property;
  • Intellectual property matters;
  • Membership of corporate bodies;
  • Arbitrations;
  • Commercial use of ships;
  • Tax and customs duties.

The Ordinance does not affect immunities conferred by the Diplomatic and Consular Privileges Act, 1972. Section 3 of this Act allows the Federal Government to withdraw these privileges from a state’s mission or consular posts.

Section 86 of the CPC grants immunity to foreign rulers but not foreign states, although Section 86A lists exceptions for suits against diplomatic agents.

  1. What exceptions may apply where the claim results from improper actions of the defendant state, such as wars of aggression?

Section 17(2) of the State Immunity Ordinance, 1981 excludes: (a) Proceedings related to armed forces while present in Pakistan, meaning foreign armed forces may not claim immunity for certain actions. (b) Criminal proceedings, as a foreign state cannot claim immunity to avoid criminal liability in Pakistan.

  1. What due process standards and exceptions may apply in proceedings for enforcement of judgment against a state?

Article 4 of the Constitution of Pakistan 1973 ensures that individuals are dealt with in accordance with law. Articles 9, 10, 10-A, 12, 13, 14, and 25 provide various protections, including fair trial and due process rights.

Section 14 of the State Immunity Ordinance, 1981 prohibits relief against a state by way of injunction, specific performance, or recovery of property without the state’s consent.

  1. What standard will the court apply in the enforcement proceedings when assessing whether the service requirements have been met in the original proceedings against a state?

Any notice required for proceedings against a state must be transmitted through the Ministry of Foreign Affairs and is deemed served when received. Section 13(2) of the State Immunity Ordinance, 1981 mandates a two-month waiting period after receipt of notice before initiating proceedings. States appearing in proceedings cannot later object to non-compliance with notice requirements. Default judgments require proof of service and a two-month period for the state to apply for reversal.

Alternative service methods are possible if agreed by the state.

  1. What exceptions may apply where conventional forms of service against a state are impossible, such as due to the absence of diplomatic relations?

Order 5 Rule 25 of the CPC allows for service by post to defendants residing outside Pakistan without local agents. Order 5 Rule 26 permits service through a political agent or court in foreign territories if appointed by the government. An endorsement from the political agent or court serves as evidence of service.

  1. What standard will the court apply in the enforcement proceedings when assessing whether the right to representation requirements have been met in the original proceedings against a state?

The standard is derived from the Constitution of Pakistan, which ensures fair and impartial hearings. Article 14 mandates equality before the courts, while Article 10 guarantees the right to consult and be defended by a legal practitioner.

  1. What exceptions may apply where the defendant state cannot find legal representation or chooses not to be represented?

Provincial rules, such as those in Volume 3 of the High Court Rules and Orders (Lahore), provide for state-appointed legal counsel for unrepresented accused in criminal trials.

  1. What assets may be subject to enforcement if the claim is against a state and what are the requirements, such as enforcement against assets of state-owned entities?

Section 15 of the State Immunity Ordinance, 1981, specifies that immunities apply to the sovereign, government, and departments, but not to separate entities capable of suing or being sued. Separate entities have immunity only if acting in sovereign authority. Therefore, assets of state-owned entities may be enforceable if they do not fall under sovereign activities.

By The Josh and Mak Team

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