INDIA Trends and Developments Contributed by: Pritha Srikumar Iyer, Aditya Chatterjee, Mansa Shukla and Mrinali Dave, Keystone Partners
The Supreme Court’s comparative approach – importing Indian summary adjudication principles Messer Griesheim raised the distinct question of whether a judgment rendered under a summary pro - cedure, without a full trial, could be enforced in India. To answer this question, the Supreme Court under - took a comparative analysis of the procedural prin - ciples governing summary adjudication under Indian and English law. Traditionally, the inquiry under Indian law has focused on whether the foreign court applied its mind to the dispute after giving the parties an opportunity to pre - sent their case. In Alcon , the Supreme Court held that a foreign judgment is enforceable if it follows a fair process, gives proper notice, and considers both sides’ arguments. Once these conditions were satis - fied, the executing court would not sit in appeal over the correctness of the foreign decision. The emphasis in Alcon was therefore on the existence of adjudica - tion rather than the procedure adopted in deciding the case. Messer Griesheim proceeds a step further. The Eng - lish court had indisputably heard both parties, con - sidered extensive written submissions and delivered a reasoned judgment and yet the Supreme Court declined to enforce. The foreign proceedings in Mess- er Griesheim culminated in a summary judgment after Goyal had been denied leave to defend, despite rais - ing what the Indian Supreme Court regarded as sub - stantial triable issues. The Supreme Court therefore shifted the focus, from asking whether the foreign court gave reasons, to asking whether using a sum - mary process was appropriate at all, given what Goyal was trying to argue. This shift becomes evident from the authorities relied upon by the Supreme Court. Instead of confining itself to decisions on Section 13 of the CPC, the court extensively referred to Indian case law on the circum - stances in which an Indian court may refuse leave to defend (see IDBI Trusteeship Services Ltd v Hubtown Ltd and B L Kashyap & Sons Ltd v JMS Steels and Power Corporation ). These cases say that refusing permission to defend should be the exception, not the rule. A defendant with a real defence, even one that is not certain to succeed, should usually be allowed
Rules and the principles on exercise of summary jurisdiction settled in Easyair Ltd ( t / a Openair ) v Opal Telecom Ltd , [2009] EWHC 339 (Ch). It concluded that, under each framework, Goyal had raised substantial triable issues that warranted a full trial, or at the very least, a fuller investigation before the dispute could be finally determined. • The Supreme Court drew on Easyair to observe that the English position also mandates caution before a claim is disposed of without trial. On that footing, the Supreme Court held that summary judgment “resulted in premature adjudication of disputed questions of fact and effectively denied [Goyal] a meaningful opportunity to establish its case through oral evidence and cross-examina - tion”. • Consequently, the foreign judgment could not be regarded as a decision on the merits of the case, and the denial of leave to defend was held to have fallen short of the requirements of natural justice. • The Supreme Court also found the English judg - ment unenforceable on the ground that it failed to give effect to the conditions attached to the Reserve Bank of India (RBI)’s approval issued under the Foreign Exchange Regulation Act, 1973 (FERA) in relation to the guarantee. The Supreme Court held that the judgment proceeded without recognising binding Indian regulatory requirements applicable to the underlying transaction. The Messer Griesheim judgment is significant because the court went beyond earlier authorities’ decisions on foreign judgments and instead undertook a compara - tive examination of Indian and English summary adju - dication principles. It is this aspect of the judgment that merits closer examination. The Supreme Court also separately considered wheth - er the English judgment was independently unen - forceable on account of the conditions attached to the RBI’s approval under the FERA regime. While the court addressed this issue in detail, the present article focuses on the “judgment on the merits” requirement in the context of summary adjudication. Accordingly, the discussion below is confined to that aspect of the judgment.
212 CHAMBERS.COM
Powered by FlippingBook