\u00a9 2017 Sherby & Co., Advs.<\/p>\n
Although Israeli courts tend to take a pro<\/em>-recognition approach to non-Israeli judgments, it is unusual for an Israeli court to issue a 38-page decision when adjudicating such a matter.\u00a0 At the same time, not every day does a non-Israeli judgment creditor seek to enforce a foreign judgment in excess of $160 million.\u00a0 The recent case of Otkritie International Investment Management<\/em>, Civil File 35884-05-14 was such a decision.\u00a0 Money \u201ctalks\u201d \u2013 and sometimes that \u201ctalk\u201d results in a detailed judicial decision.<\/p>\n Various aspects of the Otkritie<\/em> decision are of interest.\u00a0 In this blog post, we will address only two issues \u2013 (a) the court\u2019s analysis of the question of personal (international) jurisdiction, and (b) the award of costs.<\/p>\n Jurisdictional defense available to a judgment-debtor:<\/strong>\u00a0 Under Israel\u2019s Enforcement of Foreign Judgments Law (1958), one of the defenses available to a judgment-debtor is that the foreign judgment was given by a court \u201cthat was not authorized to give it under the rules of private international law as applied in Israel\u201d \u2013 or (in common law parlance) that the non-Israeli court was without personal jurisdiction.<\/p>\n For at least 20 years, case law from Israel\u2019s Supreme Court has recognized two grounds (arguably only<\/em> two grounds) for finding that a foreign court had personal jurisdiction over the foreign (usually Israeli) defendant \u2013 \u201cresidence\u201d or \u201csubmission.\u201d\u00a0 The \u201cresidence or submission\u201d rule has been repeated several times by Israel\u2019s Supreme Court.<\/p>\n In analyzing the issue of the personal jurisdiction of an English court, the Otkritie<\/em> court made the following observation:<\/p>\n Consent to jurisdiction may be given in different ways, including orally and implicitly.\u00a0 One of the ways to give consent to jurisdiction is when a litigant litigates in a foreign court on the merits.<\/p>\n<\/blockquote>\n Undoubtedly there is case law from other Israeli district courts that supports the above-quoted statement from the Otkritie<\/em> court.\u00a0 But the Otkritie<\/em> court did not cite to any Supreme<\/em> Court case in support of that proposition.<\/p>\n The reason appears to be that there simply is no<\/u><\/em> such case law from Israel\u2019s Supreme Court.<\/p>\n This state of the case law is interesting for a number of reasons \u2013 not the least of which is that, in many areas of international litigation, case law from Israel\u2019s Supreme Court is more favorable to non-Israeli litigants than is case law from Israel\u2019s lower courts.\u00a0 Two examples of such dichotomy are the enforceability of forum selection clauses (calling for litigation outside Israel) and the exercise by Israeli courts of \u201clong-arm\u201d jurisdiction.\u00a0 In those two areas, it is common for a non-Israeli defendant to \u201cwish\u201d that the lower court would faithfully apply Supreme Court precedent.<\/p>\n In any event, the implied consent rule, as summarized by the Otkritie<\/em> court, is reasonably grounded in district court case law such that, when a judgment-debtor asserts the lack of jurisdiction of the non-Israeli court, the judgment-creditor can assume that, as a general matter, a well-grounded assertion of implied consent will prevail.<\/p>\n Award of Court Costs:<\/strong>\u00a0 As indicated above, the Otkritie<\/em> decision is 38 pages.\u00a0 The primary reason for such a lengthy decision appears to be the judgment-debtor\u2019s \u201chold no punches\u201d litigation strategy \u2013 it asserted just about everything.\u00a0 The District Court did not like that approach, as reflected in paragraph 141 (the final paragraph) of the decision:<\/p>\n Taking into account the [above] and the totality of the [circumstances] and the relevant considerations, including the manner in which the case was litigated, the monetary sum in dispute, the complexity of the case, the testimony that was brought (including expert opinions and from abroad), and other factors . . . , the defendants are required to pay the plaintiffs the amount of NIS 450,000.<\/p>\n<\/blockquote>\n It is extraordinary (albeit not unheard of) for an Israeli court to issue a costs order of NIS 450,000.\u00a0 It appears that the \u201ckitchen sink\u201d approach taken by the defendants was the key ingredient (excuse the pun) in the court\u2019s decision to impose significant costs.<\/p>\n As indicated above, various aspects of the Otkritie<\/em> decision are of interest, and we will report on those in a future blog post.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" \u00a9 2017 Sherby & Co., Advs. Although Israeli courts tend to take a pro-recognition approach to non-Israeli judgments, it is unusual for an Israeli court to issue a 38-page decision when adjudicating such a matter.\u00a0 At the same time, not every day does a non-Israeli judgment creditor seek to enforce a foreign judgment in excess<\/p>\n\n
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