Not Normal Servis on Foreign Judgments: Servis-Terminal LLC v Drelle [2025] EWCA Civ 62
In a very significant ruling that might be subject to further appeal, the Court of Appeal held that a bankruptcy petition cannot be presented in respect of an unrecognised foreign judgment.
The following key points emerge from the Court of Appeal’s judgment:
- An unrecognised judgment has no “direct operation” in this jurisdiction and, as a result, cannot be used as a “sword” to bring proceedings;
- There is a distinction to be made between a judgment that confirms an underlying debt and a judgment that creates a debt;
- An obligation to make a payment imposed by an unrecognised judgment does not constitute a “debt” for the purpose of s267 Insolvency Act 1986; and
- These consequences reflect the common law’s aversion to enforcing a foreign exercise of sovereign power, also seen in respect of the “revenue rule”.
As a result, the unrecognised Russian judgment in issue in the case was not capable of providing the basis for a bankruptcy petition. Accordingly, the bankruptcy order made by the Insolvency and Companies Court Judge was set aside and the petition dismissed.
Read the full judgment here.
https://www.bailii.org/ew/cases/EWCA/Civ/2025/62.html
