A refreshing no-nonsense approach from Teare J today in Midtown Acquisitions LP v Essar Global Fund Ltd  EWHC 519 (Comm) to a guarantor desperately trying to avoid enforcement in London of a judgment given against it in Manhattan. EGF had guaranteed a facility given to Essar Steel Minnesota LLC, a now-very-bankrupt former subsidiary of monster Indian conglomerate Essar Global. When Essar Minnesota defaulted, EGF confessed liability ; a New York judge duly signed judgment against it in the modest sum of about $172 million. EGF applied to vacate the judgment: meanwhile the creditor, Midtown, wasted no time and applied to enforce it in England.
Teare J in quick succession demolished four arguments hopefully raised against enforcement.
(a) The New York order was based on a confession of liability, with no action technically brought. Irrelevant, he said: it was still a judgment.
(b) The outstanding application to vacate meant that the judgment wasn’t final. Nonsense: it was immediately binding as res judicata in New York unless and until set aside, and that sufficed to make it enforceable in England.
(c) The judgment was on admissions, with neither party arguing on the law or the facts. So what? It was still a judgment on the merits — i.e. whether EGF had to pay $172 million.
(d) To a half-hearted pleading of fraud, Teare J answered shortly that only a showing of conscious and deliberate dishonesty would do to establish this, and none had been pleaded or shown.
In addition he was prepared to enforce the judgment on the basis of a clause under which “The Guarantor agrees that a judgment in any such action, suit or proceeding may be enforced in any other jurisdiction by suit upon such judgment … The Guarantor hereby waives any objection it may now or hereafter have to the laying of the venue of any such action, suit or proceeding, and … further waives any claim that any such action, suit or proceeding brought in any of the aforesaid courts has been brought in any inconvenient forum.”
The only indulgence he allowed was a short stay of execution until one week after the result of the application to vacate: unless the application was successful, execution would then follow automatically.
In our view this judgment is to be welcomed and should be widely publicised. If a creditor has a clear claim, the fact that it got judgment on it quickly, with no argument, ought to be a factor in favour of, rather than against, its being immediately able to enforce that judgment here. Furthermore, delaying tactics such as applications to vacate should generally not be allowed to derail the process. The message is simple: even outside the EU context, bring your judgments to London, and we’ll enforce them unless the other side produces a pretty convincing reason why we shouldn’t.