#5148 - Apostolides - Conflict of Laws BCL

Apostolides (2009)

Facts

The reference was made in the course of proceedings between Mr Apostolides, a Cypriot national, and Mr and Mrs Orams, a British married couple ('the Orams'), concerning the recognition and enforcement in the United Kingdom, under Regulation No 44/2001, of two judgments given by the Eparkhiako Dikastirio tis Lefkosias (District Court, Nicosia) (Cyprus).

The land is situated at Lapithos, in the district of Kyrenia, which is in the northern area. It belonged to Mr Apostolides' family, which occupied it before the invasion of Cyprus by the Turkish army in 1974. As members of the Greek Cypriot community, Mr Apostolides' family was forced to abandon their house and take up residence in the area of the island effectively controlled by the Cypriot Government ('the Government-controlled area').

The Orams claim to have purchased the land in 2002 in good faith from a third party, the latter having himself acquired it from the authorities of the Turkish Republic of Northern Cyprus, an entity which, to this day, has not been recognised by any State except the Republic of Turkey. The successive acquisitions were in accordance with the laws of that entity. The Orams built a villa and frequently occupy the property as their holiday home.

Proceedings before Cyprus courts by Apostolides: On 26 October 2004, the Eparkhiako Dikastirio tis Lefkosias, a Cypriot court established in the Government-controlled area, issued the documents instituting proceedings in the action brought by Mr Apostolides against the Orams. On the same day, those documents, one for each spouse, were served at the property on the land by a process server from that court. The documents were both served by being handed in person to Mrs Orams who refused to sign for them.

The process server did not inform Mrs Orams that he was a process server or of the nature of the documents served by him, the documents being written in Greek, which the Orams do not understand. However, Mrs Orams understood that those documents were legal and official in nature.

On 9 November 2004, as no one had entered an appearance for the Orams, the Eparkhiako Dikastirio tis Lefkosias gave a default judgment on Mr Apostolides' claim. On the same day, the court refused the authority presented by Mrs Orams' lawyer because it was written in English and not in Greek or Turkish.

Application by Orams to have the judgment set aside: On 15 November 2004, the Orams applied to have the judgment set aside. After hearing evidence and arguments from the Orams and Mr Apostolides, the Eparkhiako Dikastirio tis Lefkosias dismissed the Orams' application by judgment of 19 April 2005 essentially on the ground that they had not put forward an arguable defence to dispute Mr Apostolides' title to the land.

Enforcement proceedings in England: On 18 October 2005, Mr Apostolides produced the documents required in England to apply, pursuant to Regulation No 44/2001, for the recognition and enforcement of the judgments concerned. By order of 21 October 2005, a Master of the High Court of Justice (England and Wales), Queen's Bench Division, ordered that the judgments be enforceable in England pursuant to that regulation.

Holding

Effect of the new Art. 34(2) under the Regulation

By its fourth question, the referring court asks essentially whether the recognition or enforcement of a default judgment may be refused under Article 34(2) of Regulation No 44/2001 by reason of the fact that the defendant was not served with the document instituting the proceedings or with an equivalent document in sufficient time and in such a way as to enable him to arrange for his defence, where he was able to commence proceedings to challenge that judgment before the courts of the Member State of origin.

Under Articles 34(2) and 45(1) of Regulation No 44/2001, the recognition or enforcement of a default judgment must be refused, if there is an appeal, if the defendant was not served with the...