Edited by Jürgen Basedow, Giesela Rühl, Franco Ferrari and Pedro de Miguel Asensio
Chapter R.10: Remedies
Obtaining an effective and enforceable remedy is the key objective of the claimant in any piece p. 1532of civil litigation and, correspondingly, resisting the grant of such relief is the main goal of the defendant. Remedies as a discrete topic has been subject to little systematic analysis in private international law. Instead, it has been typically examined in the context of jurisdiction or procedure (in the case of interim or provisional relief such as anti-suit injunctions (→Anti-suit injunctions) or freezing orders (→Freezing injunctions and search orders)) or substantive causes of action such as tort or contract (in the case of final relief such as damages, declarations and specific performance). For the purposes of analysis in this chapter, the distinction between interim (or provisional) and final relief will be adopted.
II. The nature of the remedy
A general point to be noted concerning the awarding of remedies in transnational litigation is that a claimant can only obtain remedies that are available under forum law. The rationale of this view is that remedies are part of the court’s machinery for resolving disputes and it is not practical for the forum to have to implement foreign remedies. The form of the remedy sought in litigation is therefore governed by forum law: Phrantzes v Argenti  2 QB 19; Slater v Mexican National Railroad, 194 US 120 (1904). EU law embodies this principle by providing in art 15(d) →Rome II Regulation (Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II),  OJ L 199/40) and art 12(1)(c) Rome I Regulation (Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I),  OJ L 177/6; →Rome Convention and Rome I Regulation (contractual obligations)) that any remedy sought must be within the limits conferred by the forum’s procedural law. Modern commentary on private international law agrees that once a remedy is found to exist within the forum’s armoury, its availability on the given facts of a case should, as far as possible, depend upon the applicable law of the obligation (Richard Garnett, Substance and Procedure in Private International Law (OUP 2012) 296–297; George Panagopoulos, Restitution in Private International Law (Hart 2000) 68). Such an approach helps to minimize forum shopping and to avoid unnecessary applicable law →dépeçage between substantive right and remedy.
III. Interim remedies
The most common forms of interim relief in transnational litigation are freezing orders and anti-suit injunctions, both of which are comprehensively discussed in the entries →Injunction, →Freezing injunctions and search orders and →Anti-suit injunctions. Two points should initially be noted about anti-suit injunctions. The first is that the award of anti-suit injunctions is generally confined to common law countries and the second is that a court of an EU Member State has no power to issue an anti-suit injunction to restrain proceedings in another Member State (Turner v Grovit  1 AC 101), but such injunctions may be granted to restrain actions in non-EU Member States (Ust-Kamenogorsk Hydropower Plant JSC v AES Ust-Kamenogorsk Hydropower Plant LLP  UKSC 35).
1. Applicable law
In terms of applicable law, the availability of interim relief is almost universally considered a procedural matter and so is governed exclusively by forum law. Such a view is clearly justified where such remedies are integrally related to the conduct of proceedings in the forum, for example, where an anti-suit injunction is sought to restrain the pursuit of foreign litigation that may interfere with proceedings in the forum or where local or foreign assets are sought to be frozen to satisfy a future judgment given on the merits in the forum. However, such an unqualified application of forum law may be less justified where, for example, the basis of an anti-suit injunction is that the foreign proceedings are ‘vexatious or oppressive’ in terms of equity or where such proceedings are alleged to be in breach of contract (for example, an exclusive jurisdiction clause). In these two latter cases, a stronger argument in favour of the law of the obligation may be made, given the proximity of the relief to the rights and liabilities of the parties. Such a view is supported by art 15(d) Rome II Regulation, which provides that the law of the obligation applies to a ‘measure designed to prevent or terminate injury or damage’, which would likely include an anti-suit injunction issued to enforce equitable rights. However, p. 1533interlocutory relief is not covered by the Rome I Regulation and so national law rules must apply to cases in which interim relief is sought in relation to contracts subject to the Regulation. Article 15(d) Rome II Regulation may also have the effect of reversing the traditional view that freezing orders are governed by forum law as matters of procedure, since they would also seem to be a ‘measure to ensure the provision of compensation’. If that view is correct, then the law of the obligation will apply to determine whether such a measure is granted.
Under EU law, jurisdiction to award interim relief (most commonly freezing orders) is conferred on the court of a Member State that has jurisdiction over the substance of the case in accordance with arts 4 et seq Brussels I Regulation (recast) (Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast),  OJ L 351/1; →Brussels I (Convention and Regulation)) (Case C-391/95 Van Uden Maritime BV v Firma Deco-Line  ECR I-7019, para 19). Second, art 35 Brussels I Regulation (recast) provides a further basis of jurisdiction to a court to order interim relief, even where it does not have jurisdiction as to the substance of the case, where such relief is sought in aid of proceedings before another Member State’s court. However, such jurisdiction is only permissible where there is ‘a real connecting link’ between the subject matter of the relief sought and the territory of the Member State before which the measures are sought (Case C-391/95 Van Uden Maritime BV v Firma Deco-Line  ECR I-7019, para 40).
In the case of interim relief sought outside the European jurisdictional regime, an English court will have jurisdiction to grant such relief where it is ancillary to substantive proceedings in the forum (Masri v Consolidated Contractors International SAL  EWCA Civ 303) and also where it is sought in aid of foreign proceedings (see s 25 of the Civil Jurisdiction and Judgments Act 1982 (c 27)) provided that, again, a genuine connecting link with the forum exists. A genuine link will exist where the freezing order sought is confined to assets within the jurisdiction (Mobil Cerro Negro Ltd v Petroleos de Venezuela SA  1 Lloyd’s Rep 684). In the case of assets outside the forum, English courts have generally required that the defendant whose conduct was sought to be restrained be present in the territory of the granting court (see Banco Nacional de Comercio Exterior SNC v Empresa de Telecommunicaciones de Cuba SA  EWCA Civ 662; Credit Suisse Fides Trust SA v Cuoghi  QB 818; for a fuller discussion of this issue, see →Injunction). In such cases, service may be made upon a defendant both within and (with the permission of the court) outside the jurisdiction.
In the case of anti-suit injunctions, English courts have also required that the forum court must also be shown to have a ‘necessary interest in or connection with the matter in question’ before exercising jurisdiction to grant such relief, out of respect for the foreign interests involved and the need for →comity (Airbus Industries GIE v Patel  1 AC 119, 138).
Enforcement of interim relief can be difficult unless the defendant is present in the forum in which the orders were granted or has assets there that may be seized in the event of non-compliance. If the defendant resides outside the forum in which the orders were issued and has no local assets there, enforcement is complicated by the fact that most countries’ legal systems (especially common law jurisdictions) do not allow for the enforcement of foreign judgments for interim remedies. In order to be enforceable, a foreign judgment must normally be ‘final and conclusive’, which means not capable of variation or amendment in the granting court. However, a line of authority has developed in common law countries whereby interim relief granted in foreign common law countries’ ‘equitable’ jurisdictions may be recognized by the granting of equivalent or parallel remedies in the country of enforcement. Such a principle has allowed Australian courts, for example, to recognize the appointment of a receiver by a US court to recover assets in Australia (White v Verkouille  2 Qd R 191) and to grant a freezing order in support of similar relief issued by a Bahamas court over the defendant’s assets worldwide, including assets in Australia (Davis v Turning Properties Pty Ltd (2005) 222 ALR 676). p. 1534Of course, such decisions may be seen alternatively as examples of interim relief being granted in aid of foreign proceedings, the permissibility of which, as noted above, is recognized by statute in England and in EU law (art 35 Brussels I Regulation (recast)).
However, EU law makes it clear in a separate provision in the Brussels I Regulation (recast) that interim relief granted by the court of one Member State may be directly enforceable in the court of another Member State under art 36 of the Regulation. This result is achieved by the Regulation defining the term ‘judgment’ in art 2(a) as including ‘provisional, including protective measures ordered by a court or tribunal which, by virtue of this Regulation, has jurisdiction as to the substance of the matter’.
IV. Final relief
1. Applicable law
a) Non-monetary remedies
In common law countries, final non-monetary relief, such as orders for specific performance, rescission of contracts, declarations and permanent injunctions, has historically been governed by forum law because it originated in the medieval equitable jurisdiction based on conscience (see Paramasivam v Flynn (1998) 160 ALR 203; National Commercial Bank v Wimborne (1978) 5 BPR 11958). This approach had a serious consequence where equitable remedies such as specific performance and →injunction are sought in aid of ‘non-equitable’ rights, for example, to enforce a contract or restrain commission of a tort. In such cases, even where foreign law governs the obligation, the equitable remedy will only be granted if the conditions under forum law for its being ordered are satisfied: see Baschet v London Illustrated Standard Co  1 Ch 73. Consequently, the remedy may not be granted even if it would have been ordered under the law of the obligation: Warner Brothers Pictures Inc v Nelson  1 KB 209.
The ‘conscience’ principle underlying equity also meant that where purely equitable rights were involved, such as fiduciary duties or confidence, both substantive right and remedy have been traditionally governed by forum law. However, recent commentary and the majority of US decisions have cast doubt on this approach, arguing that equitable rights and obligations should no longer be governed by the law of the forum, but by the nearest analogous cause of action on the facts (Tiong Min Yeo, Choice of Law for Equitable Doctrines (OUP 2004)). Hence, for example, in the case of a breach of fiduciary duties, the applicable law rules for contract may be applied by analogy or, in the case of breach of confidence, the contract or tort rules may be the appropriate category depending upon the facts. Such a change in applicable law analysis to equitable rights has also led commentators to assert that, logically, the availability of final equitable remedies should also no longer be governed by forum law, but should instead, where possible, be subject to the law of the accompanying obligation (Adrian Briggs, ‘Conflict of Laws and Commercial Remedies’ in Andrew Burrows and Edwin Peel (eds), Commercial Remedies: Current Issues and Problems (OUP 2003) 271; George Panagopoulos, Restitution in Private International Law (Hart 2000)).
Under EU law, the law of the obligation is applied to non-monetary relief: provided that the remedy exists ‘under the forum’s procedural law’, the law of the obligation determines whether such relief should be granted. For example, art 12(1)(c) Rome I Regulation applies the law of the contractual obligation to the ‘consequences of a total or partial breach of obligations’ and art 15(d) Rome II Regulation applies the law of the non-contractual obligation to ‘a measure designed to prevent or terminate injury or damage’. Hence, under EU law, a claimant’s right to a final injunction to restrain commission of a civil wrong or an order for specific performance to enforce a contract will be determined by the law of the obligation. The traditional common law position is therefore almost entirely rejected and a view is taken similar to the recent commentary mentioned above. It will be interesting to see if the EU principles have a harmonizing or ‘reflexive’ effect on the common law so that an internationally consistent approach will be achieved.
A constructive trust is an equitable remedy imposed by a common law court in respect of property that has been acquired by a defendant in circumstances that are regarded as unconscionable in equity (for example, fraud) with such property declared to be held on trust for the claimant. While authority is not uniform, the availability of this remedy is now best regarded as being governed by the law of the obligation (for example, unjust enrichment) the breach of p. 1535which gives rise to the duty to make relief (see Chase Manhattan Bank NA v Israel-British Bank (London) Ltd  Ch 105). The position is also likely the same under EU law, where such a trust arises out of →unjust enrichment as this remedy would arguably be a ‘measure which a court may take to prevent or terminate injury or damage, or to ensure the provision of compensation’ under art 15(d) Rome II Regulation. However, the situation that has arisen before English courts is where the law of the obligation does not recognize the remedy of the constructive trust (as is the case in most civil law countries). The approach taken by English courts is to examine whether the foreign law of the obligation would impose a liability similar to that under English law, namely, that the defendant disgorge an unjustly acquired benefit. If such a liability exists under the law of the obligation, then a constructive trust may be imposed as it would be consistent with the objectives of the foreign law (see First Laser Ltd v Fujian Enterprises (Holdings) Co Ltd  HKCFA 52 paras 65–69; Kuwait Oil Tanker SAK v Al Bader  2 All ER (Comm) 271). It is doubtful whether such an approach is permissible in EU law under the Rome II Regulation.
In common law countries the right to →set-off has historically been governed by forum law as a procedural matter, whereas in civil law countries a distinction has been drawn between cases where the effect of the defendant’s claim to set-off is to discharge or extinguish its liability to the claimant on the original claim (substantive) and where a cross-claim is merely brought by the defendant in the same proceeding (procedural). EU law considers all questions of set-off as substantive issues and provides that where the right to set-off is not agreed by the parties, it shall be governed by the law applicable to the claim against which the right to set-off is asserted (see art 17 Rome I Regulation). Where the right to set-off is agreed between the parties, the general rules on choice of law in contract under arts 3 and 4 Rome I Regulation apply to determine the scope and validity of the right (see further the entry on →Set-off).
The issue of final non-monetary remedies would not be complete without reference to the →CISG (United Nations Convention of 11 April 1980 on Contracts for the International Sale of Goods, 1489 UNTS 3). The CISG operates as a set of transnational autonomous rules which override domestic law in contracts to which the Convention applies and includes a number of innovative remedies. The CISG gives the buyer the right to reduce the purchase price for the goods if the goods delivered do not conform with the contract (art 50) and the right to require delivery of substitute goods in the event of non-conformity and where such non-conformity amounts to a fundamental breach (art 46(2)). The CISG also provides both parties with a right to avoid the contract in the case of a fundamental breach (arts 49(1) and 64(1)) and the remedy of specific performance (arts 46(1) and 62). Each party may also grant the other (breaching) party an additional period of time for performance (arts 47 and 63).
In the area of →damages for breach of contractual and non-contractual obligations there has been a similar movement towards greater control by the law of the cause of action as opposed to the law of the forum. In common law and civil law jurisdictions it is well established that the issue of available heads of damages (for example, for economic loss or physical injury) are governed by the law of the obligation (see Boys v Chaplin  AC 356; Cox v Ergo Versicherung AG  2 WLR 948; Breavington v Godleman (1988) 169 CLR 41). There is also a general consensus that the right to pre-judgment interest, that is, interest by way of damages dating from the accrual of the cause of action or on a contractual debt, is governed by the law of the obligation. The question of whether benefits may be deducted from an award of damages is also now likely, in most cases, to be determined by the law of the obligation (Cox v Ergo Versicherung AG  2 WLR 948). Where the right to damages has been abolished by statute and replaced by a no-fault administrative scheme, all jurisdictions accept that the scheme must be applied as part of the law of the obligation.
On the issue of quantification or assessment of damages, the traditional common law approach has been to refer all such questions to the law of the forum, both where the issue concerns the calculation of damages and where the legislature imposes a limitation or ‘cap’ on damages, unless such a cap is a provision in a contract. Such an approach is still followed in English and Canadian common law (Harding v Wealands  2 AC 1). By contrast, in Australia, it has been held that ‘all questions about the ... amount of damages’ p. 1536are governed by the law of the obligation (John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503). Interestingly, the approach taken in Australia is also mirrored in EU law. Article 15(c) Rome II Regulation provides that the applicable law of the non-contractual obligation shall ‘govern ... the existence, nature and assessment of damage or the remedy claimed’ and art 12(1)(c) Rome I Regulation uses similar language in relation to contract. The effect of such language is that available heads of damages, caps on damages, deductibility of benefits and the right to an award of pre-judgment interest are all governed by the law of the obligation. Questions of assessment or calculation of damages are also resolved by this law (for a fuller discussion of this issue, see the entries on →Damages and →Substance and procedure).
Article 74 CISG imposes an autonomous rule for the award of damages in contracts to which the Convention applies.
For a court to have the ability to award final relief, it must first have personal jurisdiction in the action brought against the defendant. In the case of EU domiciled defendants, the principles of the Brussels I Regulation (recast) now apply with any defendant being able to be sued in the country of domicile or alternative forums in arts 4 et seq of the Regulation.
In the case of non-EU domiciled defendants, the personal jurisdiction principles of national law apply. In England the jurisdiction of courts is invoked by service of the claim form either on a defendant present within England or (with the permission of the court) on a defendant outside the EU where a relevant connection with England is established (see the Civil Procedure Rules). Examples of such grounds include where a claim is made for an injunction ordering the defendant to do or refrain from doing an act within the jurisdiction or where a claim is made in tort or contract and the obligation has a specified link to the forum.
In the case of an action against a non-EU domiciled defendant, the defendant may also seek a stay of English proceedings on the basis that a ‘more appropriate forum’ exists elsewhere, that is, a country ‘in which the case may be tried more suitably for the interests of all the parties and ends of justice’ (Spiliada Maritime Corporation v Cansulex Ltd  1 AC 460). In applying this test of forum non conveniens, an English court will consider whether there is a ‘legitimate personal or juridical advantage’ to the claimant in having the proceeding heard in the local court. Generally speaking, the fact that a claimant could receive higher damages in English proceedings than before a foreign court is not normally a sufficient advantage, by itself, to avoid a stay (Spiliada Maritime Corporation v Cansulex Ltd  1 AC 460, 483; Cooley v Ramsey  EWHC 129, para 57). Yet, in a number of cases, English courts have refused to stay their proceedings in favour of a foreign court where the difference between the damages that could be recovered in England and in the foreign jurisdiction has been shown to be great (The Vishva Abha  2 Lloyd’s Rep 312; Caltex Singapore Pte Ltd v BP Shipping Ltd  1 Lloyd’s Rep 286). Such decisions show that on occasion there can be an important link between available final remedies and a common law court’s decision to exercise jurisdiction. Given the absence of any doctrine of forum non conveniens under EU law or in civil law countries, such an issue does not generally arise.
The question of enforcement of final remedies in foreign courts is partly well settled and partly in a state of reappraisal in common law countries. The traditional approach has been that a foreign judgment will only be recognized and enforced where it requires a defendant to pay a sum of money to the judgment creditor/claimant, such as an award of damages (Sadler v Robins  1 Camp. 853). However, such a rule has always been subject to the →public policy (ordre public) of the forum so that, for example, in some jurisdictions a foreign award of exemplary or punitive damages will not be enforced.
The requirement that an enforceable foreign judgment must be for a fixed sum of money (→Money and currency) historically precluded enforcement in the forum of foreign orders for specific performance, declarations or final injunctions. Yet recently in Canada, it has been suggested that the ‘fixed sum’ rule is outdated in a time of increased technological change and modern communications, and when national courts need to cooperate with one another in the resolution of transnational disputes. Consequently, a foreign p. 1537non-money judgment may now be enforced in Canada where: (i) the foreign order was clear and specific as to its territorial scope and the rights, duties and obligations that it imposes on the defendant; and (ii) it does not impose an undue burden on the Canadian justice system or the rights of third parties (Pro Swing Inc v Elta Golf Inc  2 SCR 612). Application of the above principles would allow injunctions, specific performance orders and declarations (for example, for constructive trust: Bienstock v Adenyo Inc  ONSC 4997) to be recognized and enforced. Significantly, the Canadian approach has been adopted in Jersey (Brunei Investment Agency and Bandone Sdn Bhd v Fidlis Nominees Ltd  JRC 1520) and in the Australia-New Zealand Agreement on Trans-Tasman Court Proceedings and Regulatory Enforcement (Agreement between the Government of Australia and the Government of New Zealand on Trans-Tasman Court Proceedings and Regulatory Enforcement  ATS 32) where final and conclusive non-monetary judgments from each country may now be enforced in the other country’s courts (see s 66 Trans-Tasman Proceedings Act 2010 (Cth)).
The principle that a court may enforce foreign non-money judgments is also consistent with the position under EU law. Under art 36(1) Brussels I Regulation (recast), a judgment given in a court of one Member State shall be recognized in other Member States, with ‘judgment’ pertinently defined as ‘any judgment given by a court or tribunal of a Member State, whatever the judgment may be called, including a decree, order, decision or ... writ of execution’. Such a provision again shows the potential for the harmonization of common law and EU law approaches.
Bernard Audit, Droit International Privé (3rd edn, Economica 2005);
Adrian Briggs, ‘Conflict of Laws and Commercial Remedies’ in Andrew Burrows and Edwin Peel (eds), Commercial Remedies: Current Issues and Problems (OUP 2003) 271;
Lord Collins of Mapesbury and others (eds), Dicey, Morris & Collins on the Conflict of Laws (15th edn, Sweet & Maxwell 2012);
Andrew Dickinson, The Rome II Regulation (OUP 2008);
James Fawcett, Janeen Carruthers and Peter North, Cheshire, North & Fawcett’s Private International Law (14th edn, OUP 2008);
Richard Fentiman, International Commercial Litigation (OUP 2010);
Richard Fentiman, ‘The Scope of Transnational Injunctions’  NZJPIL 323;
Richard Garnett, Substance and Procedure in Private International Law (OUP 2012);
Konstantinos Kerameus, ‘Provisional Remedies in Transnational Litigation’ in International Association of Procedural Law (ed), Transnational Aspects of Procedural Law, vol 3 (Giuffrè 1998) 1169;
George Panagopoulos, Restitution in Private International Law (Hart 2000);
Richard Plender and Michael Wilderspin, The European Private International Law of Obligations (3rd edn, Sweet & Maxwell 2009);
Adam Rushworth, ‘Remedies and the Rome II Regulation’ in John Ahern and William Binchy (eds), The Rome II Regulation on the Law Applicable to Non-contractual Obligations (Martinus Nijhoff 2009) 199;
Janet Walker, Castel & Walker Canadian Conflict of Laws (6th edn, LexisNexis Butterworths 2005);
Tiong Min Yeo, Choice of Law for Equitable Doctrines (OUP 2004).