Enforcing Foreign Judgments in California by Loren Lunsford, Esq.

Foreign Judgments may be enforced in California in the same manner as California judgments. However, before a foreign judgment may be enforced, it must be recognized by the California Courts. The procedure for recognition of the foreign judgment depends on whether the foreign judgment is classified as a sister state judgment or a foreign country money judgment.

A sister state judgment is defined as “that part of any judgment, decree, or order of a court of a state of the United States, other than California, which requires the payment of money, but does not include a support order as defined in Section 155 of the Family Code.” Cal. Code of Civ. Proc. § 1710.10. A foreign-country judgment, on the other hand, means “a judgment of a court of a foreign country” and includes “a judgment by any Indian tribe recognized by the government of the United States.” Cal. Code of Civ. Proc. § 1714(b). A ’Foreign Country’ means a government other than any of the following:

(1) The United States.
(2) A state, district, commonwealth, territory, or insular possession of the United States.
(3) Any other government with regard to which the decision in this state as to whether to recognize a judgment of the government’s courts is initially subject to determination under the Full Faith and Credit Clause of the United States Constitution.

Cal. Code of Civ. Proc. § 1714(a).

Subject to some exceptions, California will recognize a foreign-country judgment to the extent that the judgment both: (1) grants or denies recovery of a sum of money; and under the law of the foreign country where rendered, is final, conclusive, and enforceable. Cal. Code of Civ. Proc. §1715(a). California, however, will not recognize a foreign-country judgment even if the judgment grants or denies recovery of a sum of money, to the extent the judgment is for taxes, a fine, or a penalty. Cal. Code of Civ. Proc. §1715(b).

The procedure for recognition of a sister state judgment is different than that for recognition of a foreign-country money judgment. The judgment creditor with a sister state judgment simply files an application with the superior court in the county where the judgment debtor resides, or, if no judgment debtor resides in the states, in any county, requesting that the judgment be recognized. Cal. Code of Civ. Proc. §§1710.15(a) and 1710.20(a) and (b).

The application for recognition shall be executed under oath and shall include all of the following:
(1) A statement that an action in this state on the sister state judgment is not barred by the applicable statute of limitations.
(2) A statement, based on the applicant’s information and belief, that no stay of enforcement of the sister state judgment is currently in effect in the sister state.
(3) A statement of the amount remaining unpaid under the sister state judgment and, if accrued interest is to be included in the California judgment, a statement of the amount of interest accrued on the sister state judgment (computed at the rate of interest applicable to the judgment under the law of the sister state), a statement of the rate of interest applicable to the judgment under the law of the sister state, and a citation to the law of the sister state establishing the rate of interest.
(4) A statement that no action based on the sister state judgment is currently pending in any court in this state and that no judgment has previously been entered in any proceeding in this state.
(5) Where the judgment debtor is an individual, a statement setting forth the name and last known residence address of the judgment debtor. Where the judgment debtor is a corporation, a statement of the corporation’s name, place of incorporation, and whether the corporation, if foreign, has qualified to do business in California. Where the judgment debtor is a partnership, a statement of the name of the partnership, whether it is a foreign partnership, and, if it is a foreign partnership, whether it has filed a statement pursuant to Section 15800 of the Corporation Code designating an agent for service of process.
(6) A statement setting forth the name and address of the judgment creditor.

Cal. Code of Civ. Proc. 1710.15(b). In addition to the above-referenced statements, the application for recognition shall also include a properly authenticated copy of the sister state judgment. Cal. Code of Civ. Proc. §1710.15(c). The California Judicial Council has approved Form Number EJ-105 which may be used in applying for recognition of a sister state judgment.

Upon the filing of the application for recognition, the clerk shall enter a judgment based on the application in the amount remaining unpaid under the sister state judgment, plus the amount of interest accrued on the sister state judgment and the amount of the fee for filing the application for entry of the sister state judgment. Cal. Code of Civ. Proc. § 1710.25(a). Entry of the judgment is made in the same manner as entry of an original judgment of the California court. Cal. Code of Civ. Proc. §1710.25(b).

Notice of the application for recognition of a sister state judgment is not required to be served on the judgment debtor prior to entry of the judgment, however, once the judgment has been recognized and entered as a judgment with the court, the judgment creditor is required to serve a notice of entry of judgment promptly upon the judgment debtor in the manner provided for service of summons (Cal. Code of Civ. Proc. §§415.10, et seq.). Cal. Code of Civ. Proc. § 1710.30(a). The notice shall be in the form prescribed by the Judicial Council and shall inform the judgment debtor that the judgment debtor has 30 days within which to make a motion to vacate the judgment. Id. The Judicial Council has approved Form Number EJ-110 which may be used to provide notice of entry of judgment.

A writ of execution cannot be issued and the judgment creditor cannot begin enforcement of the recognized judgment until at least 30 days after the judgment creditor serves notice of entry of the judgment on the judgment debtor. Cal. Code of Civ. Proc. §1710.45(a). Not later than 30 days after service of notice of entry of judgment upon the judgment debtor, the judgment debtor may file a motion to vacate the judgment based “on any ground which would be a defense to an action in this state on the sister state judgment, including the ground that the amount of interest accrued on the sister state judgment and included in the judgment entered . . . is incorrect.” Cal. Code of Civ. Proc. §1710.40(a).

The judgment debtor’s filing a motion to vacate the judgment can be a basis for the court to grant a stay of enforcement of the judgment. The court may also grant a stay of enforcement where:

(1) An appeal from the sister state judgment is pending or may be taken in the state which originally rendered the judgment. Under this paragraph, enforcement shall be stayed until the proceedings on appeal have been concluded or the time for appeal has expired.
(2) A stay of enforcement of the sister state judgment has been granted in the sister state. Under this paragraph, enforcement shall be stayed until the sister state stay of enforcement expires or is vacated.
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(4) Any other circumstance exists where the interests of justice require a stay of enforcement.
Cal. Code of Civ. Proc. §1710.50(a).

If no stay has been entered and more than 30 days have passed from the date when the judgment debtor was served with notice of entry of judgment, the recognized judgment “shall have the same effect as an original money judgment of the court and may be enforced or satisfied in like manner.” Cal. Code of Civ. Proc. §1710.35.

Where a sister state judgment may be entered by the clerk upon filing of an application, recognition of a foreign country money judgment must be initiated either by the filing of an original matter or may be raised by counterclaim, cross-claim, or affirmative defense. Cal. Code of Civ. Proc. § 1718. The party seeking recognition of a foreign-country judgment has the burden of establishing that the foreign-country judgment is entitled to recognition. Cal. Code of Civ. Proc. § 1715(c).

To the extent the foreign-country judgment grants or denies recovery of a sum of money and, under the law of the foreign country where rendered, is final, conclusive, and enforceable, and is not for taxes, a fine, or penalty, California shall recognized such a judgment unless:

(1) The judgment was rendered under a judicial system that does not provide impartial tribunals or procedures compatible with the requirements of due process of law.
(2) The foreign court did not have personal jurisdiction over the subject matter.
(3) The foreign court did not have jurisdiction over the subject matter.
Cal. Code of Civ. Proc. § 1716(b). In addition to the above-referenced basis by which a California court may not recognize a foreign-country judgment, a court in California is not required to recognize a foreign-country judgment if any of the following apply:
(1) The defendant in the proceeding in the foreign court did not receive notice of the proceeding in sufficient time to enable the defendant to defend.
(2) The judgment was obtained by fraud that deprived the losing party of an adequate opportunity to present its case.
(3) The judgment of the cause of action or claim for relief upon which the judgment is based is repugnant to the public policy of the State of California or the United States.
(4) The judgment conflicts with another final and conclusive judgment.
(5) The proceeding in the foreign court was contrary to an agreement between the parties under which the dispute in question was to be determined otherwise than by proceedings in that foreign court.
(6) In the case of jurisdiction based only on personal service, the foreign court was a seriously inconvenient forum for the trial of the action.
(7) The judgment was rendered in circumstances that raise substantial doubt about the integrity of the rendering court with respect to the judgment.
(8) The specific proceeding in the foreign court leading to the judgment was not compatible with the requirements of due process of law.
(9) The judgment includes recovery for a claim of defamation unless the court determines that the defamation law applied by the foreign court provided at least as much protection for freedom of speech and the press as provided by both the United States and California Constitutions.

Cal. Code of Civ. Proc. § 1716(c).

While the initial burden is on the party seeking recognition to establish that the foreign judgment meets the requirements of Cal. Code of Civ. Proc. §1715, the party resisting recognition has the burden of establishing a ground for non-recognition exists. Cal. Code of Civ. Proc. §1716(d).

With regards to the requirement that the foreign court had personal jurisdiction over the defendant, a foreign-country judgment shall not be refused recognition for lack of personal jurisdiction if any of the following apply:
(1) The defendant was served with process personally in the foreign country.
(2) The defendant voluntarily appeared in the proceeding, other than for the purpose of protecting property seized or threatened with seizure in the proceeding or of contesting the jurisdiction of the court over the defendant.
(3) The defendant, before the commencement of the proceeding, had agreed to submit to the jurisdiction of the foreign court with respect to the subject matter involved.
(4) The defendant was domiciled in the foreign country when the proceeding was instituted or was a corporation or other form of business organization that had its principal place of business in, or was organized under the laws of, the foreign country.
(5) The defendant had a business office in the foreign country and the proceeding in the foreign court involved a cause of action or claim for relief arising out of business done by the defendant through that office in the foreign country.
(6) The defendant operated a motor vehicle or airplane in the foreign country and the proceeding involved a cause of action or claim for relief arising out of that operation.

Cal. Code of Civ. Proc. § 1717(a). The above-referenced list is not exclusive and the courts of California are free to recognize bases of personal jurisdiction other than those listed above as sufficient to support a foreign-country judgment. Cal. Code of Civ. Proc. § 1717(b).

Once a California court finds that the foreign-country judgment is entitled to recognition, to the extent that the foreign-country judgment grants or denies recovery of a sum of money, the foreign-country judgment is both:
(a) Conclusive between the parties to the same extent as the judgment of a sister state entitled to full faith and credit in this state would be conclusive.
(b) Enforceable in the same manner and to the same extent as a judgment rendered in California.
Cal. Code of Civ. Proc. §1719.

To the extent that the foreign-country judgment is rendered in a currency other than the currency of the United States, the Uniform Foreign-Money Claims Act (“UFMCA”) provides that except in the case of assessed costs, “a judgment or award on a foreign-money claim shall be stated in an amount of the money of the claim.” Cal. Code of Civ. Proc. § 676.7(a). Such a judgment is payable in that foreign money or, at the option of the judgment debtor, “in the amount of United States dollars which will purchase that foreign money on the conversion date at a bank-offered spot rate.” Cal. Code of Civ. Proc. §676.7(b). Costs assessed by the California court shall be entered in United States dollars. Cal. Code of Civ. Proc. §676.7(c).

When seeking recognition of a foreign-country judgment that is stated in the money of the foreign country, California law provides that the judgment rendered by a California court substantially in the following form complies with the requirements of the UFMCA:

“IT IS ADJUDGED AND ORDERED, that Defendant (insert name) pay to Plaintiff (insert name) the sum of (insert amount in the foreign money) plus interest on that sum at the rate of (insert rate – see Section 676.9) percent a year or, at the option of the judgment debtor, the number of United States dollars which will purchase the (insert name of foreign money) with interest due, at a bank-offered spot rate at or near the close of business on the banking day next before or near the close of business on the banking day next before the day of payment, together with assessed costs of (insert amount) United States dollars.”

Cal. Code of Civ. Proc. §676.7(f).

California Code of Civil Procedure section 676.9 provides that with respect to a foreign-money claim, recovery of pre-judgment or pre-award interest and the rate of interest to be applied in the action or distribution proceeding, except as provided in subdivision (b), are matters of the substantive law governing the right to recovery under the conflict-of-laws rules of California. Cal. Code of Civ. Proc. §676.9(a). Subdivision (b) requires the court or an arbitrator to “increase or decrease the amount of pre-judgment or pre-award interest otherwise payable in a judgment or award in foreign money to the extent required by the law of [California] governing failure to make or accept an offer of settlement or offer of judgment, or conduct by a party or its attorney causing undue delay or expense.” Cal. Code of Civ. Proc. §676.9(b).

The judgment or award entered on a foreign-money claim bears interest at the rate applicable to judgments of California. Cal. Code of Civ. Proc. § 676.9(c). A “foreign-money claim” means “a claim upon an obligation to pay, or a claim for recovery of a loss, expressed in or measured by a foreign money,” and for the purposes of this article would include a foreign judgment expressed in a foreign money. Cal. Code of Civ. Proc. §676.1(6).

Once a foreign-country money judgment is recognized and judgment is entered on it, or a judgment is entered on a sister-state judgment under the full faith and credit clause of the United States Constitution, either judgment may be enforced in the same way and in the same manner as a California State judgment.