Henry Alexander Brompton Gwyn-Jones v Richard William McDonald
| Jurisdiction | Ireland |
| Judge | Mr. Justice Murray |
| Judgment Date | 12 November 2021 |
| Neutral Citation | [2021] IECA 303 |
| Docket Number | Court of Appeal Record No. 2021/33 |
| Year | 2021 |
| Court | Court of Appeal (Ireland) |
In the Matter of Regulation (Eu) No. 1215/2012
and
Pursuant to Order 42A of the Rules of the Superior Courts (Jurisiction, Recognition and Enforcement of Judgments) 2017
and
In the Matter of a Judgment of the Sofia City Court, Republic of Bulgaria
[2021] IECA 303
Whelan J.
Murray J.
Barniville J.
Court of Appeal Record No. 2021/33
High Court Record No. 2019/16FJ
THE COURT OF APPEAL
CIVIL
Loan agreements – Enforcement – Stay – Appellant seeking orders refusing enforcement of a judgment – Whether the enforcement should be stayed
Facts: The appellant, Mr Gwyn-Jones, and the respondent, Mr McDonald, entered into three agreements, dated 28 March, 18 April and 26 April 2011, by which the latter lent monies to the former. The monies were not repaid, and proceedings were brought by the respondent before the Sofia City court for judgment on foot thereof. Two separate actions were commenced: one to enforce the 28 March and 26 April agreements; and the other to enforce the agreement of 18 April. The action to enforce the agreement of 18 April resulted in a judgment of 11 November 2016. The action on foot of the 28 March and 26 April agreements resulted in a judgment of 31 October 2017. In December 2019 proceedings were brought by the appellant in Ireland seeking orders refusing recognition and/or enforcement of the judgment of 31 October 2017 or, in the alternative, a stay on the recognition or enforcement thereof. The High Court (Barr J) ([2020] IEHC 689) rejected that application. The appellant appealed to the Court of Appeal from that decision. The appellant raised three objections to the judgment of Barr J in his Notice of Appeal: first, the trial Judge erred in failing to refuse enforcement of the Bulgarian judgment on the grounds that to permit same would be contrary to public policy as provided for in Article 45(1)(a) of Regulation (EU) No. 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast); second, the trial Judge erred in refusing enforcement given that the appellant had recently initiated arbitration proceedings in the International Chamber of Commerce International court of Arbitration (ICC) against the respondent personally alleging that the respondent had defrauded the appellant of €26M and that the contracts the subject of the Bulgarian judgment were procured as a result of that alleged fraud; third, the trial Judge erred in refusing to stay enforcement of the Bulgarian judgment pending the hearing and outcome of the arbitral proceedings before the ICC. The appellant issued a motion seeking an order pursuant to Order 86A, rule (4)(b) of the Rules of the Superior Courts to admit additional evidence comprising a consent award made by Sir Eder QC arbitrator in ICC case No. 20711/TIO between Gort (Holdings) Ltd and MRP Brazil Ltd and Burgas Holdings Ltd, together with certificates and copies of translations of applications made to the SCC on 24 September 2021 seeking annulment/revocation of the judgment the subject of the enforcement proceedings. The appellant applied for a stay on the enforcement of the Bulgarian order pending the outcome of the application to the SCC.
Held by Murray J that the appellant had failed to identify any basis on which the decision of Barr J was wrong. Murray J held that it was appropriate that the appellant be permitted to make the case he sought to advance regarding the effect of the application to the SCC and to that extent the material he sought to adduce in evidence was relevant. Murray J held that he would exercise any discretion the Court had against a stay on enforcement as it was clear that Bulgarian law provided a process for imposing a stay on the enforcement of the judgment pending the application before the SCC, the appellant had failed to invoke that procedure and no credible explanation had been advanced for that failure.
Murray J held that the appeal should be dismissed and the order of Barr J affirmed. Murray J refused the application of the respondent to dismiss the appeal in limine, and granted the application of the appellant to admit further evidence. Murray J refused the application made for staying enforcement of the judgment pending the outcome of the application under Article 303 of the Bulgarian Civil Procedure Code to the SCC. It was Murray J’s preliminary view that the respondent should obtain his costs of the appeal.
Appeal dismissed.
JUDGMENT of Mr. Justice Murray delivered on the 12 th day of November 2021
. The legal and factual context to this appeal is described in my judgment in closely related proceedings between the same parties ( [2021] IECA 206). Essentially, legal entities then related to and/or controlled by the appellant and respondent became involved in the acquisition of a shopping complex in Bulgaria (‘the Burgas Plaza’). That transaction was initiated in November 2007 and was completed by January 2009. It was effected via a Maltese special purpose vehicle which acquired the shares of a Bulgarian company, MB Izgrev EAD. This latter entity subsequently changed its name to Burgas Plaza AD.
. The companies directly involved in the transaction were (insofar as relevant for present purposes) Gort (Holdings) Ltd. (‘Gort’) (the vehicle used by the appellant to make his investment), Balkan Holdings Limited, now known as MRP Brazil Ltd. (‘MRP’) (the vehicle representing the interests of the respondent) and Burgas Holdings Ltd. (‘BHL’) (the Maltese special purpose vehicle used for the purpose of the investment). The appellant now claims that the respondent made fraudulent misrepresentations to him at the time of this transaction, but for which he would not have made the investment in the Burgas Plaza. This claim is the subject of arbitration proceedings commenced by Gort against MRP and various other corporate bodies before the International Chamber of Commerce International Court of Arbitration (‘ICC’) in late 2014 (‘the first arbitration’), in aid of which certain interlocutory freezing orders were made against MRP by the Isle of Man High Court.
. In 2011, and following the completion of the Burgas Plaza transaction, the appellant and respondent entered into three identically worded agreements by which the latter lent monies to the former (those agreements being dated March 28, April 18 and April 26 2011). The monies advanced on foot of these agreements were not repaid, and proceedings were brought by the respondent before the Sofia City Court for judgment on foot thereof.
. Two separate actions were commenced. One action was to enforce the March 28 and April 26 agreements, and the other to enforce the agreement of April 18. The action to enforce the agreement of April 18 resulted in a judgment of the Sofia City Court of November 11 2016. The action on foot of the March 28 and April 26 agreements resulted in a judgment of the Sofia City Court of October 31 2017. While this appeal is concerned with the recognition and enforcement of the judgment of October 31 2017, as matters have developed the two judgments have become irretrievably intertwined.
. The proceedings seeking to enforce the loan agreement of April 18 were purportedly served on the appellant at his home in Cork on 19 August 2016. The appellant did not defend those proceedings at first instance, contending thereafter that he had not been duly or properly served with them. Upon the granting by the Sofia City Court on November 11 2016 of judgment in those proceedings in the sum of €119,522.24 and the service of that judgment on the appellant on 26 June 2017, the appellant sought to set this judgment aside before the Bulgarian Supreme Court of Cassation (‘SCC’), relying to that end upon Article 303 of the Bulgarian Civil Procedure Code. When by decision of 17 July 2018, the SCC refused this application, the appellant sought to have the SCC reconsider its decision. This request was refused on 25 January 2019.
. In the meantime, the appellant (in July 2018) brought proceedings before the High Court seeking orders refusing the recognition and/or enforcement of this judgment of the Sofia City Court. In that application he claimed that the proceedings had not been duly or properly served upon him, as well as advancing an argument based upon public policy and a fraud the appellant contended had been perpetrated upon him. He also relied upon the fact that in January 2020 and shortly before the hearing the appellant had commenced a second arbitration commenced before the ICC in which he personally sought relief against the respondent arising from the alleged fraud (‘the second arbitration’). In a judgment delivered in May 2020 Meenan J. ( [2020] IEHC 240) refused the appellant that relief. That decision was unsuccessfully appealed to this court resulting in the judgment to which I have referred above ( [2021] IECA 206).
. Unlike the procedure leading to the first judgment, the action seeking judgment on foot of the agreements of March 28 and April 26 2011 was fully contested by the appellant at first instance, and the judgment granted against him on October 31 2017 (following a hearing on 5 October 2017) was unsuccessfully appealed to the Court of Appeal, Sofia Civil Division (the hearing before which was on 5 November 2018, judgment being delivered on 6 December 2018). An application to the SCC to allow the appellant to make a further appeal to it was rejected by decision of 10 October 2019. The judgment thereby obtained by the respondent was in the sum of €425,926 together with interest.
. In those proceedings the...
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Henry Alexander Brompton Gwyn-Jones v Richard William McDonald
...206) Whelan J. and Costello J. are each in agreement with this judgment and the orders I propose and in respect of the second appeal ( [2021] IECA 303) Whelan J. and Barneville J. similarly agree with both this judgment and the proposed 2 . The appellant describes his principal application ......