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ReadyLaw, Lawyer
Category: Law
Satisfied Customers: 2714
Experience:  Bar Professional Training Course
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In Common Law where a Creditor seeks Debtor to obtain a

Customer Question

In Common Law where a Creditor seeks Debtor to obtain a judgement. For example if the Debtor ( a Company ) resides in UK and the Creditor ( Company ) resides in Sri Lanka, where the Creditor should file an action to recover any debts from the Company in UK
JA: What state are you in? And are you working with a local attorney?
Customer: not yet
JA: Has anything been filed in civil court? If so, what?
Customer: This is a defence expected to be filed in near future on enforcement of a foreign judgement ( by Sri Lankan Courts ) where the Creditor filed a suit in Sr Lanka against a UK Company. The High Court decided that there is no jurisdiction. But the Sri Lanka Supreme Court reversed that High Court judgement stating that they have the jurisdiction. We are going to challenge that decision in UK stating that Sri Lankan Courts lack jurisdiction. That is how the first question came. Where a Creditor seeks justice against a Debtor
JA: Is there anything else the Lawyer should know before I connect you? Rest assured that they'll be able to help you.
Customer: Only that
Submitted: 19 days ago.
Category: Law
Expert:  ReadyLaw replied 19 days ago.

Hi, welcome to JA, I am Readylaw one of legal experts here. My goal is to provide you with the best experience possible and answer any questions which you may have about your current situation. I may not respond immediately, this is because I may need a few minutes to read what you shared above, type and respond to you. Feel free to ask any follow up questions as needed until you are satisfied.

Customer: replied 19 days ago.
The question is that can a Sri Lankan Company ( Creditor ) file a case in Sri Lankan courts against a Debtor ( a UK registered Company ) to obtain a judgement. Is it to file in Sri Lanka or in UK Courts ?
Expert:  ReadyLaw replied 19 days ago.

Thanks for your patience and enquiry.

As the matter has been commenced in the Sri Lankan court, you would not be able to simply commence a stand alone application in the UK to decide whether the Sri Lankan court lacks jurisdiction or not. That's the first difficulty that I see.

My view is the point to raise the issue of jurisdiction is if the Sri Lankan court grants the order with respect to the debt and the company then attempts to enforce it in the UK. At that stage you would apply to the court in the UK on the basis that they would not be in a position to allow the enforcement as at the time it was granted the court lacked the jurisdiction.

My view however is that as the creditor resides in Sri Lanka that the courts there would have jurisdiction to deal with the matter. The only caveat to this is if there was in fact a loan agreement which specifically stated which courts would have jurisdiction in the event of disagreements.

Can I clarify anything for you? I hope I have answered your query in a way that is simple and easy to understand. If anything remains unclear, I will be more than happy to clarify it for you. In the meantime, thank you once again for using our services.

Customer: replied 19 days ago.
What is the situation when there is no valid written agreement. How the UK Courts look at that under that circumstance. I heard that the Creditor should seek the Debtor meaning the Creditor should file the case in UK where the Debtor resides. Am I wrong ?
Expert:  ReadyLaw replied 19 days ago.

The case may be started in either jurisdiction where there is no agreement.

Customer: replied 18 days ago.
We had an agreement. In that it has been agreed that the Jurisdiction is in Sri Lanka. The agreement expressly expired after a period of 12 months. Some transactions occurred thereafter and there had been a dispute and the party in Sri Lanka filed a case based on the terms of that expired agreement ( claiming the jurisdiction on a term of that expired agreement). The Sri Lankan party at the hearing accepted expressly that the agreement has expired but some transaction continued. The High Court judge declared that there cannot be Jurisdiction on an expired agreement and also the party has not proved there case either and dismissed the case.
Then that party appealed to the Supreme Court ( at that time some Supreme Court judges have developed a grudge against one of the directors of our Company on a very serious issue.. that is a long story and that is a separate issue on our defence in UK court ) and Supreme Court decided that the Sri Lankan Court has jurisdiction while accepting the fact that the original agreement had expired. They declared that in contracts both express and implied contracts are valid on law. There had been some unit rates for a commodity we paid on a verbally agreed rate between the parties. Both parties could not prove there expected rates as there was no written agreement and the transacted rates for a period of 6 months is different from what was on the expired agreement. My point at this moment is can any implied term on jurisdiction be a legally valid term. The things like rate etc., are things could be decided fairly. But Jurisdiction is law and can the jurisdiction be decided on implicit terms .( The High Court judge decided it correctly saying the jurisdiction has not been proved by the Party and therefore decided that there is no jurisdiction.).
Can the law be interpreted in implied terms ?
According to the Sri Lankan law too there is no jurisdiction as we are not domiciled in the area of jurisdiction of the Court and domiciled only in UK.
The Supreme Court took the term in the expired agreement to decide the jurisdiction stating that it implied ( there was no proof that we have ever agreed to that term after the expire of the agreement.
In Sri Lanka if Cause of Action took place in one province that cannot be filed in a Court in another province.Q1. Is there any such territorial jurisdiction in UK too.
Q2. Can the Law be interpreted under implied conditions as in this case
Expert:  ReadyLaw replied 17 days ago.

My apologies for the delay in responding. I was not aware of your follow up question.

I believe I have answered your question, albeit not in line with your position. I do believe the contract governs the jurisdiction of the court. Clauses to do with which country has jurisdiction in the event of a dispute arising from the contract does not expire because the contract itself expire. This is of course my view.

In any event, as i understand it the Supreme Court of Sri Lanka is the final court. As such, whether you are in agreement or not, its decision is binding on you. You cannot now start litigation in the UK, it would be dismissed on the basis that there is an abuse of process once it is brought to the UK court's attention that litigation was already done in Sri Lanka.

Customer: replied 17 days ago.
I am taking too much of your time. On enforcement of foreign judgement ( as I read ) provides opportunity to defend by law. The applicable Law to Sri Lanka is is Administrative Justice Act of 1920 ( with amendments ). The UK Courts do not accept the foreign judgements as it is. But the grounds for defend is very narrow but it has. (1) Jurisdiction ... The foreign country should have jurisdiction to hear the case as per the UK policy (2) any fraud involved in obtaining the judgement .. by the parties or by the Courts. (3) involvement of natural justice.
I have enough to include in my submission on (2) and (3). Even Sri Lankan Supreme Court violated all the ethical norms in justice, Bias , Prejudice , grudge etc. unbelievable things in this case and they are not simple allegations but with proofs.
My issue is the jurisdiction. According to Sri Lankan Laws to have the jurisdiction the Cause of Action should have occurred in the territorial jurisdiction of the Court , that is within the Western Province of Sri Lanka and the Defendant should reside within the jurisdiction. But the UK Company does not domicile in Sri Lanka. Only thing is that we have agreed for Sri Lankan jurisdiction for a period of one year and not beyond in our contract. The contract expired on the contract terms agreed by both parties. Then the activities continued without a contract and later there was a dispute and the other party filed a case on the basis of a term on jurisdiction on that expired contract.The primary Court ( the Commercial High Court ) decided that there is no jurisdiction and the party has not proved their case and dismissed it.
When appealed the Supreme Court declared that the Contract has lapsed but there are two things that express contract and implied contract and both valid. The Supreme Court also accepted the pact that the agreement lapsed and they decided the jurisdiction on the basis of implied agreement. My understanding is that the Law is a definitive thing and shall not be vague and the law cannot be decided on implied terms.
Hopefully I could make UK Court convince in my defence that Sri Lankan Court is wrong and the judgement is given on bias ( prejudice.. etc ) against a director of the UK Company.
Then the UK policy, common law , English law or whatever it is will come to play. What is the UK policy in deciding where the territorial jurisdiction lies. In Sri Lanka it is where the Defender resides. What is in UK ?
If I am taking too much of your firm's time and I could make an additional payment if you thin so.
Expert:  ReadyLaw replied 17 days ago.

I do believe the concerns you have require much more in depth discussions that this forum does not allow for. I have sent a request through for us to discuss this via telephone, it is optional and you are not obliged to do so.

Customer: replied 17 days ago.
Though I gave much more details what I wanted from the beginning is to know whether UK Law has any sort of territorial jurisdiction. For example if the Defendant is in Manchester and the Plaintiff is in London in which Court the Plaintiff could file the case. Please give me an answer to this and we could stop our conversation at this point.
Expert:  ReadyLaw replied 13 days ago.

Good day, my apologies for the delayed response. I was unaware of your response.
Practice Direction 2C of the civil procedure rules (para 2) stipulates that a claim Amy be started in any county court hearing Centre unless a rule stipulates otherwise. So, generally there is no jurisdictional restriction. In practice civil matters are commenced in the county court closest to the claimant or the defendant. If however the claim is commenced in the incorrect court, the matter would be forwarded to the correct court where the matter should be held. There would therefore not be the jurisdictional short comings or concerns as you imagine.

Customer: replied 12 days ago.
Thank you for your information. An hour ago your Company ( or someone with similar name .. LAWYERSJA .... ) has taken Pounds 50 from my Credit card. I did not make such payment to you or not agreed for that. I complaint to HSBC on this as a fraudulent activity. Please reply back urgently in this regard as the HSBC wishes to conduct an inquiry. This is very urgent.