Vizcaya Partners Limited v Picard

The Privy Council, through Lord Collins, gave judgment in this case on 3 February 2016. The litigation leading to the appeal had been settled but, as explained by Lord Collins, judgment was given because the appeal raised issues of international importance across the common law world concerning the scope of the conflicts of law rules on recognition of foreign judgments. The underlying legal issue concerned the question of whether the Defendant Vizcaya had by way of contractual agreement submitted to the jurisdiction of the US Bankruptcy Court where the Claimant, the Trustee of Bernard Madoff’s firm’s liquidation, had obtained a US$180m default judgment against Vizcaya. Lord Collins reviewed a substantial body of conflicting case law and academic commentary on the content and scope of the rule that a foreign default judgment is enforceable against a judgment debtor who has made a prior submission to the jurisdiction of the foreign court. Giving the advice of the Privy Council, Lord Collins held that as a matter of conflicts principles there does not have to be an express contractual agreement (or indeed any formal contractual agreement) to submit but that consent can be express or implied. Prior to this judgment the possibility of an implied consent had been doubted. He also held that an agreement to submit to a foreign court by foreign law governed contract might arise by implied term under that law. On the facts, Lord Collins, disagreeing with the Court of Appeal of Gibraltar, held that the expert evidence did not establish as a matter of fact or New York law that there was an implied term to the effect that by reason of the account documents Vizcaya had consented to the jurisdiction of the New York courts. The fact that the contract was expressly stated to be deemed to be made in New York made no difference. He also held that any submission to jurisdiction of the New York courts would not prima facie apply to judgments in bankruptcy avoidance actions.

The judgment can be read in full in the attached pdf. 

Pushpinder Saini QC, Keith Azopardi QC and Shaheed Fatima instructed by Browne Jacobson appeared for the Trustee.