Case No.:

AC-REV-94-1962

Court:

Court of Appeal

Issue No.:

1962

 

Principles

·  Conflict of Laws—Limitations of actions—Lex fori Limitation of Actions—” Accrual “—Prescription and Limitation Ordinance 1928, s. 8—Actions on Egyptian judgments—Action “accrues” when enforceable in the Sudan Conflict of Laws—Egyptian judgments— -Enforceable when final as defined in Egyptian Judgments Ordinance, s. 3 (2). Conflict of Laws—Egyptian judgments—Finality is a question of fact based on definition in Egyptian Judgments Ordinance. s. 3 (2)—Egyptian procedural law must be factually proved

Judgment creditor, applicant, brought this petition for execution in Khartoum on an Egyptian money decree by a Cairo court of first instance. All requirements under Egyptian Judgments Ordinance 1901. s. 8 were satisfied. Respondent claimed the petition was time-barred by the five-year period for claims for sums due on judgment under Prescription and limitation Ordinance 1928. Sched… Pt. II, s.. i From the judgment of the High Court holding that the petition was time-barred, applicant took this appeal.
Held: (i) Rules as to limitations of actions are governed by the lex fori law of the jurisdiction in which the remedy is sought.
(ii) The right of action accrues under Prescription and Limitation Ordinance 1928. S. 8, when the Egyptian judgment becomes enforceable in the Sudan.
(iii) An Egyptian judgment is enforceable in the Sudan under Egyptian Judgments Ordinance 1901. s.5, when it is a ‘ judgment as defined by Egyptian Judgments Ordinance 1901. S. 3 (2): “final and unalterable in the court by which it was pronounced whether an appeal against it lies to another court or not “; Egyptian definitions of finality are irrelevant.
(iv) Whether an Egyptian judgment sought to be enforced in the Sudan is final within the definition of “final judgment” in Egyptian Judgments Ordinance 1901. S. 3 (2), must be determined as a matter of fact by evidence of the Egyptian procedural laws governing the court where the judgment sought to be enforced in the Sudan was rendered.

Judgment

(COURT OF APPEAL) *

OMAIR AND ACHILLE AVAREENO v. SARKIS IZMIRLIAN

AC-REV-94-1962

Advocates: lbrahim El Mufti ... for judgment-creditors-applicant Mubarak Zarroug - -. for judgment-debtor-respondent

Mohamed Yousif Mudawi P.1. April 7, 1962, HC-PET- (Khartoum): —On December 12, 1959, advocate Ibrahim El Mufti on behalf of judgment-creditors, Avareeno Bros., of Cairo, U.A.R., petitioned this court under the Egyptian Judgments Ordinance, 1901, S. 6, for the execution of a judgment passed by an Egyptian Commercial Court on May 4, 1954, against judgment-debtor, Sarkis Izmirlian, merchant of Khartoum, for the large amount of £S.35,7

In accordance with the Egyptian Judgments Ordinance, s. 6, the court issued a summons to debtor directing him to appear and show cause why execution should not issue. Advocate Mubarak Zarroug in response to this summons appeared on behalf of debtor and challenged the application to execute on several grounds including the contention that the application was barred by our Prescription and Limitation Ordinance, 1928. He alleged that the Egyptian judgment, which was passed on May 4, 1954, could not be executed after the expiration of the five years specified by the Sudan Ordinance. Advocate Multi replied that the relevant rules of limitation should be the Egyptian rules (years) and not Sudan rules.

My distinguished colleague, Osman El Tayeb J. (as he then was), in order to resolve the controversy, framed the following issues:

i. Was respondent at the time of the said suit domiciled or ordinarily

resident in Egypt?   (On applicants)

2. Was the citation regularly served on respondent according to the

rules of Egyptian law?   (On applicants)

3. Whether “yes” or “no’s to the above two issues, does the first service of citation on respondent satisfy the rules of the Egyptian

law?  (On applicants)

4. Did respondent appear in the said case before the Egyptian court as

a defendant?   (On applicants)

. Is it essential for the finality of the said judgment, that a copy thereof be served on respondent’ (On respondent)

6. If so, is service on the Neyab sufficient to make it final according

to the Egyptian law?   (On applicants)

7.      If “yes,” was it served accordingly?   (On applicants)

8. Is the application governed by the Egyptian Law of Limitation or by the Sudan Prescription and Limitation Ordinance? (Open)

9. If governed by the Egyptian law, what is the Egyptian law?

(On applicants)

10. Are applicants entitled to execution of the said judgment?

(On applicants)

Issues I—4 are designed to show whether the judgment satisfies the requirements of the Egyptian Judgments Ordinance, s. 8.

Issues —7 are framed to clarify the question of finality referred to in the Egyptian Judgments’ Ordinance, s. 4 and.

Issues 8 and 9 deal with the question of limitation.

Issues 1—4. These issues, as mentioned above, revolve around the Egyptian Judgments Ordinance, s. 8, which reads:

“In order that the judgment of an Egyptian Tribunal may have in the Sudan the effect mentioned in the Egyptian Judgments Ordinance, s. 4, and 6, it must appear from the judgment or be otherwise shown either that:

“(1) The party against whom or against whose representatives it is sought to use or enforce the judgment was plaintiff in the pro before the Egyptian Tribunal or being a defendant appeared therein; or that,

“(2) The citation was served on him personally in Egypt; or that

“(3) The was domiciled or ordinarily resident in Egypt; or that

“(4) The action related to “property, whether movable or immovable, situate in Egypt; or that

“(5) The cause of action arose from a contract entered into in Egypt or intended to be there executed wholly or in part or from acts which wholly or in part were done in Egypt.

In the cases 3. 4 and 5 must also appear or be shown that citation was regularly served according to the rules laid down by the Egyptian codes.”

Issue No. 1 deals with s. 8 (3). Applicants were undoubtedly unable to prove that debtor was at the material time domiciled or ordinarily resident in Egypt. On the contrary, this court is of opinion that the evidence tends to show that the debtor was all along domiciled and resident in the Sudan.

Issues No. 2 and 3 seem to tackle the same point. They deal with the last sentence of Egyptian Judgments Ordinance, 1901, S. 8. The Egyptian judgment itself refers (on p. 1 of the judgment) to the fact that “this action was started by plaintiffs by a petition that was brought to the notice of defendant on May 13, 1946.” This is in my view sufficient to prove regularity for the courts of Egypt should be presumed to have checked thoroughly the regularity of their procedure. In view of this the issues (No. 2 and 3) should be decided in favour of judgment-creditors.

Issue No. 4.  This issue deals with Egyptian Judgments Ordinance, 1901, S. 8 (1). The points raised in it are in fact admitted by judgment-debtor who stated on p. 10 of the record that he briefed a certain Saba Habashi, a member of the Egyptian Bar, to represent him in the dispute. He also stated that he made a counterclaim against judgment-creditors in the same case. In view of this clear admission I am inclined to decide that judgment-debtor appeared by his advocate as a defendant in the Egyptian court. Such appearance is, in my judgment, sufficient for the purposes of Egyptian Judgments Ordinance, 1901, s. 8 (1).

Again the two parties admitted (admission 4) that at the time of the institution of the suit, judgment-debtor was in Cairo and that citation was on him personally.

In concluding this discussion of issues 1—4, 1 must say it is clearly revealed that almost all the alternative pre-requisites of Egyptian Judgments Ordinance. 1901, S. 8, were fully satisfied in some way or other. Of course the satisfaction of any one of the pre-requisites will do for the purpose.

Issues, 6, and 7. These deal with the finality of the judgment. Judgment-creditors allege, perhaps in order to bring the judgment within our Prescription and Limitation Ordinance, that the Egyptian judgment cannot be final, according to Egyptian law, unless notice of such judgment is served on judgment-debtor. He f alleges that as such notice was served on judgment-debtor on November 6. 1957, it was on that date the judgment became final.

It must be stated at once that whether a foreign judgment is final or not should be decided according to the definitions given by our law to the exclusion of any other law. The Egyptian Judgments Ordinance, s. 3 (2), defines a final judgment as “one which is final and unalterable in the court by which it was pronounced.” The notice referred to by judgment- creditors is a rule of Egyptian procedure the object of which is to notify judgment-debtor that a judgment was pronounced against him. (Strangely enough this notice should be given even if the judgment was pronounced in the presence of the judgment. debtor.) Judgment-debtor being notified may then proceed to appeal within 40 days of the date of notification if he so wished. In case no appeal was made within the specified time the judgment-creditor can proceed with the execution. I am told that the judgment in question being a special type of judgment (UJI b,.... i.e., capable of immediate execution may be executed in the Egyptian courts immediately after notice whether an appeal followed or not. P.W.2 stated that this notice is part of the execution process and according to Egyptian law it interrupts the period of limitation, which thereafter starts anew. (This remark seems to imply that even in the Egyptian courts the period begins to run before notice and is only interrupted by it.)

However, in the opinion of this court the notice is nothing more than a rule of Egyptian procedure intended to prod the judgment-debtor to exercise his right of appeal if he was serious about it. It also marks the starting point of executing the judgment. (See testimony of P.W.2 On p. 7 of the record.) As such the notice has nothing to do with finality as defined by our law. To us a judgment is final as long as it is unalterable by the court that pronounced it. It matters very little as far as finality is concerned, whether an appeal was lodged or not and whether the judgment-creditor started the execution process or not. Indeed the position of this court will verge on the realm of absurdity if it follows the suggested interpretation of the word “ final.” According to this interpretation the judgment may not reach the stage of finality for 20 or 30 years or more if the judgment-creditor was not notified.

In view of this I feel I am bound to decide that this judgment acquired finality from the date on which it was pronounced by the Egyptian Commercial Court, i.e., May 4, 1954.

Issues 8 and 9. These issues deal with the question of limitation. Judgment-debtor contends that the judgment was pronounced as a final judgment on May 4, 1954, and these execution proceedings were started by judgment-creditors on December s 2, 1959. According to our Prescription and Limitation Ordinance, continues debtor’s contention, a judgment is barred after the expiry of five years. Judgment-creditors, on the other hand, reply that the relevant rules of limitation are the Egyptian rules according to which the period of limitation is put at 15 years. Such are the conflicting views of the two parties simply put.

The well-established principle of private international law covering the application of foreign law is that though the court is bound in relevant cases to apply the substantive rules of a foreign law, it is also equally bound to apply the procedural rules of lex fori. The raison d’etre of this principle is that the rules of procedure are designed to suit the local judicial machinery of the country and foreign litigants are therefore expected to take the procedure and the machinery as they find them. They should not expect to be treated in a manner better or worse than a domestic litigant. Cheshire, Private International Law 650 (5th ed. 1957), states:

“The department of procedure constitutes perhaps the most technical part of any legal system, and it comprises rules many of which would be unintelligible to a foreign judge and certainly unworkable by a machinery designed on different lines.”

Having expounded the relevant principles, the next task of this court is to characterise the Sudan rules of limitation, i.e., to find out whether they come under the category of substantive or procedural law. The test accepted by English law—from which I have no reason to depart, is that if the period of limitation extinguishes the cause of action itself, i.e., the right itself (as opposed to the right of action) then it is characterised as a matter of substantive law but if it affects only the right of action, that is the right to have a remedy then it is put on the category of procedure. “English law,” says Dr. Cheshire (who seems to take exception to the decisions of the courts on the point) “is unfortunately committed to the view that statutes of limitation, if they merely specify a certain time after which rights cannot be enforced by action, affect procedure, not substance. They concur, it is said, not the merits of the cause, but the manner in which the remedy must be pursued” -(Cheshire, Private international Law 6 ( ed. ‘957).

In applying this test, I must say, I am convinced that our rules of limitation affect the manner in which remedy may be enforced but not the remedy itself and that they are therefore procedural and not substantive. Prescription and Limitation Ordinance, s. 7, reads:

“No action shall lie for the enforcement of the rights and claims save within the period of limitation

Prescription and Limitation Ordinance, s. 9, reads:

When any period specified in the schedule hereto shall have expired the right of action in respect of the corresponding claim shall be extinguished.”

I need not comment on the language of these two sections, which speaks for itself.

The learned counsel for the judgment-creditors, in arguing to persuade the court that it is the Egyptian limitation period that should apply, states:

According to the Egyptian Judgments Ordinance, ss. 4,5 and 6 (1), an Egyptian judgment can be executed in the Sudan as long as it is final and executory in Egypt. Whether an Egyptian judgment is final and executory is a matter which should be governed by Egyptian law alone.”

After quoting sections and 6 (1) learned counsel continues:

“The correct interpretation of the sections is that the rules of procedure which should be followed in executing an Egyptian judgment after execution is allowed, should be the same rules of procedure followed if judgment were a judgment passed by the Sudan courts. By so doing the legislature intended to distinguish the Egyptian judgments over other foreign judgments.”

I believe I am entitled to assume that the learned counsel for judgment- creditors suggests that the legislature in using the words “if such judgment is executory in Egypt” in the ordinance intended to modify in favour of Egyptian judgments the private international law principles excluding the application of foreign procedure by our courts and to render Egyptian judgments capable of execution in the Sudan as long as they can be executed in Egypt- irrespective of what our procedure, including our rules of limitation, may provide. If this is what learned counsel suggests, I must hasten to say that this court emphatically disagrees with him. It is true that the main object of the Egyptian Judgments Ordinance is to put the judgments of the courts of Egypt. as opposed to other foreign judgments, in a special place, in a privileged position, so to speak. But it will be stretching the provisions of the ordinance too far if the words “if such judgment is executory in Egypt” are interpreted in the way suggested by the learned counsel. It is I think relevant to remark that words to the same effect appear in the provisions of our law dealing with foreign judgments other than Egyptian judgment. See Civil Justice Ordinance, s. 44. Hence any interpretation of these words should apply to both enactments.

In these circumstances, I must repeat, I am comfortably clear in my mind that the legislature does not intend by using the words referred to above to alter or modify our principles of private international law. Indeed the interpretation of the words should be given within the framework of our private international law. These words, thus looked at, mean that to be capable of execution in the Sudan the judgment should not be proved to have been satisfied or in any other way settled or to have been avoided by some substantive rule of Egyptian law. That is, in my judgment the appropriate interpretation of the words “if such judgment is executory in Egypt.”

If the legislature intends to alter or modify the fundamental principles of our law let it do so clearly and unequivocably for such rules cannot be altered or modified by words of doubtful meaning or to quote a famous phrase “by a side wind.” In Dalsingar Singh V. Jainath Kuar [1940] A.I.R. (Ondh 138) 142, Hamilton J. remarked:

“There is a presumption that the legislature does not intend to make any substantial alteration in the law beyond what it explicitly declares either in express terms or by clear implication….”

In the light these remarks it will be a bit difficult to say that the words relied upon by learned counsel for judgment-creditors reveal an express intention of the legislature to alter the law. Hence it is decided that this court should follow its own procedure and that therefore this judgment is, according to the Sudan Prescription and Limitation Ordinance, statute barred.

In view of the above it is ordered that the execution petition be dismissed.

Babiker Awadalla J. October 8, 1962: —This is an application against the refusal by His Honour the Province Judge, Khartoum. to allow execution against respondent on a money decree passed on May 4 ‘9S4 by the Cairo court of first instance in favour of applicant. Applicant was at the time the decree was passed a merchant of Cairo and respondent is a merchant of Khartoum.

Application for execution of the said decree was made under the Egyptian Judgments Ordinance, 1901, S. 6, the aim of which was, so far as its preamble goes, the recognition of Egyptian judgments in the Sudan and the prevention of needless multiplicity of suits.

Under the said section, every final judgment of an Egyptian court, if it be for a debt or other definite sum of money and is executory in Egypt, shall, subject to certain reservations, be entitled to execution in the Sudan in the same manner as if it were a judgment of a Sudan court.

Respondent contested the application on several counts, which fall under two heads. He contended that the said judgment was not executable in the Sudan either because it did not comply with requirements of Egyptian Judgments Ordinance, s. 8, referred to, or if it did, then it is time barred by virtue of the provisions of the Prescription and Limitation Ordinance 1928.

I do not want to go into the defences under Egyptian Judgments Ordinance, s. 8, because it is obvious from the facts, and the court below has rightly so found, that all the pre-requisites of that section had been satisfied. The important side of respondent’s case was the plea of limitation. To this, the learned counsel for applicant replied, in the court below, that the case was either not governed by Sudan laws of limitation at all, or if it were, then the date from which the Prescription and Limitation Ordinance becomes operative is not the date of the judgment, but the date on which the judgment became final within the meaning of that word as defined in s. 3 of the Ordinance. That section defines a “final judgment” as being a judgment which is final and unalterable in the court by which it was pronounced, whether an appeal against it lies to another court or not.

The learned counsel for applicant contended that a judgment does not become final according to Egyptian laws unless and until:

(1) A copy of it is served on the judgment-debtor, or, if a judgment- debtor’s whereabouts are unknown, on El Niyaba, and

(ii) The period allowed for appeal (40 days) had elapsed without the judgment-debtor exercising his right of appeal.

In the present case, the judgment could only be served on El Niyaba on November 26, 19ç7, and therefore it became final only on January 5, 1958, i.e., the date of expiry of the time within which the judgment-debtor (respondent) could exercise his right for appeal.

His Honour the Province Judge rejected the contention that finality of Egyptian judgments executable under the Ordinance is governed by Egyptian laws and decided that the matter is governed by Egyptian Judgments Ordinance 1901, s. 3 (2). He said at p. 4 of the judgment:

“It must be stated at once that whether a foreign judgment is final or not should be decided according to the definitions given by our law to the exclusion of any other law. Egyptian Judgments Ordinance, s. 3 (2) defines a final judgment as ‘one which is final and unalterable in the court by which it was pronounced.’ The notice referred to by judgment-creditor is a rule of Egyptian procedure the object of which is to notify judgment-debtor that a judgment was pronounced against him.”

He accordingly found that the judgment in question acquired finality from the date on which it was pronounced. He also rejected the contention of the learned counsel for respondent that Egyptian laws of limitation applied to the case, because in his opinion the rules of limitation are rules of procedure and therefore must be governed by the law of the forum.

In the application for revision before this court, the same arguments made before the court below were reiterated. This court is therefore called upon to decide whether or not the decision of His Honour the Province Judge was, in the tight of those arguments, correct.

There is no doubt that in so far as limitation is concerned, the rules of the lex Ion apply. This principle is so well established in the realm of private international law and so lucidly expounded in the judgment of His Honour the Province Judge that I need not go into it any further. Under our law the period of limitation in so far as sums due on judgments are concerned is five years (see Item z of the Schedule). Prescription and Limitation Ordinance, s. 8, says that the period of limitation “shall commence and run from the date upon which the right of action accrued to the person claiming such right.” In so far as Sudan judgments are concerned, the words “right of action” of course mean the right to institute proceedings for enforcement of the judgment and this right no doubt accrues only from the date the judgment becomes enforceable. As regards Egyptian judgments executable in the Sudan under the Egyptian Judgments Ordinance, s. 6, the right accrues from the date an Egyptian judgment becomes enforceable in the Sudan. When, therefore, is an Egyptian judgment enforceable in the Sudan? The answer is to be found in our Egyptian Judgments Ordinance, which, apart from the formalities required by section 8, confers the quality of enforceability only upon judgments, which are (a) final and (b) executory in Egypt. This is the effect of sections and 6 read together.

Let us now examine the judgment under consideration and try to find out whether or not it satisfied both these conditions. There is certainly no doubt, and the fact is not contested by respondent, that the present judgment is executory in Egypt because it is of the type classed as مشمول بالنفاذ which means, according to the expert evidence adduced in the court below, “capable of execution irrespective of the debtor’s right as to appeal.”

We now come to the difficult and really most complicated part of this case, the answer to the question whether the judgment in question is “final.” On this point, I have the misfortune to disagree both with the views of His Honour the Province Judge and with the argument of the learned counsel for applicant. To say that the matter is governed by our law “to the exclusion of any other law “ to take us nowhere because our law cannot tell us how a judgment is “unalterable in the court which passed it.” Again, to say that the matter is solely to be governed by Egyptian law seems to forget the fact that here we are interpreting a Sudan enactment, which is simply a reproduction of a general common law principle relating to the recognition of foreign judgments and that in the interpretation of that enactment we are to be guided solely by our own rules of constructions, treating any relevant foreign law element purely as a question of fact that is destitute of any authoritative voice or character.

The right approach to the matter in question, therefore, is to ascertain the meaning of the words of Egyptian Judgments Ordinance, s. (2), not by reference to Egyptian laws, but by reference to our own principles of private international law, and having ascertained that meaning to proceed and hear evidence of Egyptian law as a fact and then determine when an Egyptian judgment acquires, in accordance with Egyptian laws, that quality of inalterability by the court which passed it.

In the present case, His Honour the Province judge proceeded straight away to hear evidence of Egyptian experts without first ascertaining the meaning of “finality” in accordance with our conceptions. In his examination of those experts, he had to translate the word “final” as “jt In accordance with the evidence of those experts a judgment for a sum over £S.2ço passed by a court of first instance can only be final if it were confirmed by the Court of Appeal. The conception of finality in Egypt is therefore solely determinable by the appeal criterion, which is definitely rejected by our own enactment as well as by English conceptions of private international law. In our law the question is to be decided with reference to the court, which passed the decree; in Egypt it is decided with reference to appellate jurisdiction. English works of private international law interchangeably use the phrases “final and conclusive” and “res judicata.” The former phrase was adopted in the English Foreign Judgments (Reciprocal Enforcement) Act, 1933, S. 1,which has purposes similar to those of our own enactment. Cheshire, Private International Law 626 (5th ed. 1957), uses both phrases together. He says:

A foreign judgment does not create a valid cause of action in England unless it is res judicata by the law of the country where it was given. It must be final and conclusive in the sense that it must be unalterable in the court which pronounced it.” Later he says: “The requirement of finality means that the judgment must be final in the particular court in which it was pronounced. It does not mean that there must be no right of appeal. Neither the fact that the judgment may be reversed on appeal, nor even the stronger fact that an actual appeal is pending in the foreign country, is a bar to an action brought in England Cheshire, Private International Law 628 (5th ed. 1957) Graveson, Conflict of Laws 472 (3rd ed. I9 says: “English courts will not entertain an action based on a foreign judgment unless that judgment is final and conclusive in the court which pronounced it. A judgment is not regarded as final and conclusive unless the matter is completely settled and disposed of so far as the court pronouncing judgment is concerned. If any further order is required for the enforcement of the judgment, and on application for such an order the original judgment is liable to be varied, it does not satisfy this test.” Later the same authority says: “A foreign judgment does not cease to be regarded as final and conclusive by reason either of the possibility of an appeal to a higher court or of the fact that an appeal is pending at the time of the English action on the foreign judgment.” Graveson, Conflict of Laws 473 (3rd ed. 1955). Dicey, Conflict of Laws 472 (3rd ed. 1955) uses the phrase “final and unalterable in the court, which pronounced it.” He quotes Nouvian V. Freeman (1889) 15 App.Cas. I. 13: “In order to its receiving effect here, a foreign decree need not be final in the sense that it cannot be made the subject of appeal to a higher court; but it must be final and unalterable in the court which pronounced it...”

The phrase “res judicata” may ‘be more comprehensive to an expert on Egyptian law, but there appears to be more than one term in Egyptian law conveying this conception and depending on whether the decree-holder had or had not exercised his rights as to appeal. Here again a judge examining experts on Egyptian law must Se, very careful when handling Arabic expressions; otherwise he will find that he had unconsciously drifted into highly slippery ground.

I am therefore of opinion that the decision in this case as to “finality” was based on no evidence at all and that the case must be returned for a rehearing in which fresh expert evidence on the point must be obtained in the light of the above.

Application for revision is therefore allowed with costs.

M. A. Abu Rannat C.J. October 8, 1962: —l concurs.

* Court: M. A. Abu Rannat C.J. and B. Awadalla J.