FIRST IMPRESSIONS

Friendship Treaties ≠ Judgment Treaties

John F. Coyle

It is hornbook law that the United States is not currently a party to any treaty governing the enforcement of foreign judgments.[1] At least, it was hornbook law until 1993. In that year, the U.S. Court of Appeals for the Eleventh Circuit adopted a novel interpretation of a provision in a bilateral treaty of friendship, commerce, and navigation ("FCN treaty") between the United States and Greece that transformed the treaty into a de facto judgments treaty.[2] Two years later, in 1995, the Third Circuit adopted the same interpretation of an identical clause in the United States-Korea FCN treaty.[3] Each of these courts subsequently reaffirmed its respective interpretation of the provision in question, the Eleventh Circuit in 2006 and the Third Circuit in 2011.[4]

In theory, these decisions could usher in a new era of judgments-recognition law in the United States. Indeed, a number of scholars have cited these decisions to argue that the United States is a party to a handful of treaties relating to the enforcement of foreign judgments.[5] In practice, however, this new era is unlikely to dawn for one simple reason: the treaty interpretations adopted by the Third and Eleventh Circuits are objectively incorrect.

This brief Essay explains how and why the Third and Eleventh Circuits went astray. It first discusses the general goal of the treaty provision at issue. It then explains how the Third and Eleventh Circuits have interpreted this provision. Finally, this Essay shows why this interpretation is irreconcilable with the text of the treaties.

I. FCN Treaties and Access-to-Courts Provisions

One purpose of the bilateral FCN treaty-which was a staple of U.S. diplomacy between 1778 and 1968-was to provide a "bill of rights" to foreign nationals living and working in the United States.[6] Among other things, these treaties guaranteed them the right to work in an occupation of their choosing, the right to travel freely, and the right to practice their religion without state interference. These treaties also frequently contained so-called "access to courts" provisions. The most common version of this provision-and the one contained in the United States-Greece and United States-Korea FCN treaties-states,

Nationals and companies of either Party shall be accorded national treatment and most-favored-nation treatment with respect to access to the courts of justice and to administrative tribunals and agencies within the territories of the other Party, in all degrees of jurisdiction, both in pursuit and in defense of their rights.[7]

According to a report prepared by the U.S. State Department, the purpose of this language is to "make provision[s] for judicial remedies for aliens on a liberal basis" on the theory that "nondiscriminatory access to judicial remedy is the first line of legal protection when rights granted by other treaty provisions are called into question."[8] This treaty provision guarantees, in other words, that foreign nationals will have the ability to bring suit in U.S. courts on precisely the same terms as U.S. nationals when asserting their rights under U.S. law. With this purpose in mind, let us now turn to the novel interpretation of this provision adopted by the Third and Eleventh Circuits.

II. Judicial Interpretation of the Treaty

In 1993, the Eleventh Circuit heard Vagenas v. Continental Gin Company, in which four Greek nationals sought to enforce a Greek judgment in Alabama.[9] The issue on appeal was whether the enforcement action was governed by (1) a two-year statute of limitations that applied when the Alabama Code did not otherwise specify a statute of limitations (as was the case with respect to actions seeking to enforce foreign judgments) or (2) a twenty-year statute of limitations that applied when a litigant was seeking to enforce a judgment rendered by a court in another U.S. state. The Eleventh Circuit invoked the access-to-courts provision in the United States-Greece FCN treaty to hold that the twenty-year statute of limitations applied.[10] The court reasoned that the guarantee of national treatment under this provision meant that "a Greek national with a foreign judgment must be given the same twenty-year time frame to enforce the judgment as is available to the United States citizen seeking to enforce a sister state judgment in Alabama."[11]

The court's analysis contained a subtle but significant error. A grant of national treatment with respect to court access ensures that a foreign plaintiff will have the ability to bring suit in the United States in exactly the same manner as a U.S. plaintiff. To the extent that the Eleventh Circuit held that the Greek plaintiffs must be treated as though they were U.S. nationals, it correctly applied the treaty provision.[12] Where the court went awry was in holding that the Greek judgment at issue must likewise be accorded national treatment-that is, treated as though it were a U.S. judgment.[13] Under the correct reading of the treaty provision, the court should have treated the Greek plaintiffs as though they were U.S. nationals seeking to enforce a Greek judgment in Alabama.[14] What the court did instead was treat the Greek plaintiffs as though they were U.S. nationals seeking to enforce a sister-state judgment in Alabama.

This error led the court to make several statements that lack any basis in the text of the treaty. The court stated, for example, that "the [FCN] treaty between the United States and Greece elevates the foreign judgment to the status of a sister state judgment."[15] It also stated that any contrary decision "would directly conflict with the treaty provision which mandates foreign country judgments be treated the same as sister state judgments."[16]

The Eleventh Circuit's mistake would lead to mischief two years later when the Third Circuit heard Sik Choi v. Hyung Soo Kim, which involved an attempt to enforce a Korean judgment in New Jersey.[17] Although the court ultimately declined to recognize the foreign judgment on due process grounds, it endorsed the view that the United States-Korea FCN treaty "elevates a Korean judgment to the status of a sister state judgment."[18] In support of this proposition, the Third Circuit cited only Vagenas and the litigants' briefs. It did not cite the relevant FCN treaty or, indeed, any particular provision within the treaty that made this "elevation" possible.[19]

More than a decade later, in 2006, the Eleventh Circuit heard a case in which it was called on to determine the precise legal effect that a Korean bankruptcy court proceeding would have in the United States.[20] The Eleventh Circuit again stated that "[u]nder the Treaty of Friendship, Commerce and Navigation Between the United States of America and The Republic of Korea, in fact, a Korean judgment is elevated to the status of a sister state judgment."[21] In 2011, the Third Circuit likewise reiterated its prior view that the United States-Korea FCN treaty "elevates a Korean judgment to the status of a sister state judgment."[22]

In the Third and Eleventh Circuits, therefore, the current state of the law appears to be that a judgment rendered by a court in Korea or Greece-or in any other country that is a party to an FCN treaty with the United States with a comparable access-to-courts provision-is to be treated in precisely the same way as a judgment rendered by a court in California, New York, or Texas. Under this interpretation of the treaty provision, therefore, certain foreign judgments are entitled to full faith and credit.

Unsurprisingly, a number of litigants have relied on this line of cases in an attempt to persuade courts in other U.S. jurisdictions that FCN treaties require them to grant full faith and credit to foreign judgments. In 2013, for example, a Korean judgment creditor appearing before the U.S. District Court for the District of Columbia argued that Korean judgments should be "automatically recognized" by U.S. courts under the United States­-Korea FCN treaty.[23] Other litigants have sought to use this line of cases to expand the number of countries whose judgments are purportedly entitled to full faith and credit in the United States. A judgment creditor appealing to the Florida Supreme Court in 2004, for example, argued that German judgments are entitled to such treatment.[24]

In addition, several well-known legal scholars have also implicitly endorsed the view that FCN treaties address the issue of foreign judgments. Russell Weintraub has observed, for example, that "with the exception of . . . the occasional operation of a friendship, commerce, and navigation treaty, the United States is not a party to any convention that requires recognition of judgments."[25] Louise Ellen Teitz has also stated that "[t]he United States does have some Treaties of Friendship with individual countries which elevate judgments from the particular country to the status of a sister state judgment."[26] A citation to Vagenas or its progeny invariably accompanies these assertions.

III. Access to Courts ≠ Right to Enforce Judgments

The courts, litigants, and scholars who have endorsed the view that FCN treaties may function as de facto judgments treaties have failed to read the text of these treaties with sufficient care. Most significantly, they have overlooked the fact that the word "judgment" does not appear anywhere in the treaty provision that purports to address foreign judgments. Rather, that provision guarantees that certain foreign nationals will receive "national treatment . . . with respect to access to the courts of justice and to administrative tribunals . . . both in pursuit and in defense of their rights."[27] On its face, this particular treaty provision is concerned exclusively with the right of foreign nationals to sue in U.S. courts on the same terms as U.S. nationals. It says nothing concerning whether foreign judgments should or should not be enforced.

Consider, by way of comparison, Article 33(1) of the Brussels I Regulation, which governs the enforcement of judgments among European Union states. This Article provides that "[a] judgment given in a Member State shall be recognized in the other Member States without any special procedure being required."[28] If similar language were contained in an FCN treaty, a case could be made that the treaty addressed foreign judgment recognition. Such language is, however, absent from all U.S. FCN treaties.[29]

The extensive commentary relating to FCN treaties also provides no support for the notion that they are concerned with the issue of foreign judgments. In 1953, for example, Robert Wilson wrote an entire article on the topic of access-to-courts provisions in FCN treaties.[30] This article contains not a single hint that these provisions were intended to provide for enforcement of foreign judgments. In 1981, officials at the U.S. State Department prepared a lengthy commentary on each provision contained in the standard draft of the U.S. FCN treaty.[31] The discussion of the access-to-courts provision in this report states clearly that "[t]he national treatment rule does not imply a right to the summary execution of a foreign judgment."[32] More recently, several other scholars have expressed skepticism, albeit in passing, about whether FCN treaties require the enforcement of foreign judgments.[33]

Given the absence of any textual basis for the views expressed by the Third and Eleventh Circuits, and in light of the authorities that squarely contradict those views, the interpretation of the access-to-courts provision that these courts offer is simply incorrect. This provision guarantees certain foreign nationals the ability to sue in U.S. courts on the same terms as U.S. nationals. It does not guarantee national treatment to foreign judgments, nor does it entitle these judgments to full faith and credit under the U.S. Constitution. To claim otherwise is to misread the treaty.

Conclusion

The lack of any judgments treaties between the United States and any foreign nation is lamentable.  Courts cannot, however, remedy this problem by transforming treaties that do not otherwise address the issue of judgments into de facto judgments treaties. The entire Vagenas line of cases should be overruled. Courts in other jurisdictions follow it at their own peril.


          *      Assistant Professor of Law, University of North Carolina School of Law.

          [1].     E.g., Gary B. Born & Peter R. Rutledge, International Civil Litigation in United States Courts 1080 (5th ed. 2011) ("Unlike many foreign states, the United States is not a party to any international agreement regarding the recognition of judgments.").

          [2].     Vagenas v. Cont'l Gin Co., 988 F.2d 104, 107 (11th Cir. 1993).

          [3].     Sik Choi v. Hyung Soo Kim, 50 F.3d 244, 248 (3d Cir. 1995).

          [4].     Otos Tech Co. v. OGK Am., Inc., 653 F.3d 310, 312-13 (3d Cir. 2011); Daewoo Motor Am., Inc. v. Gen. Motors Corp., 459 F.3d 1249, 1259 (11th Cir. 2006).

          [5].     E.g., Saad Gul, Old Rules for a New World? The Constitutional Underpinnings of U.S. Foreign Judgment Enforcement Doctrine, 5 Appalachian J.L. 67, 70 (2006) ("In some cases, an expansive interpretation of bilateral treaties [of friendship, commerce, and navigation] has provided the structure for [foreign judgment] enforcement."); Louise Ellen Teitz, Both Sides of the Coin: A Decade of Parallel Proceedings and Enforcement of Foreign Judgments in Transnational Litigation, 10 Roger Williams U. L. Rev. 1, 55 n.228 (2004) ("The United States does have some Treaties of Friendship with individual countries which elevate judgments from the particular country to the status of a sister state judgment."); Russell J. Weintraub, How Substantial Is Our Need for a Judgments-Recognition Convention and What Should We Bargain Away to Get It?, 24 Brook. J. Int'l L. 167, 167-68 (1998) ("[W]ith the exception of . . . the occasional operation of a friendship, commerce, and navigation treaty, the United States is not a party to any convention that requires recognition of judgments." (citations omitted)); Arthur Anyuan Yuan, Enforcing and Collecting Money Judgments in China from a U.S. Judgment Creditor's Perspective, 36 Geo. Wash. Int'l L. Rev. 757, 781 n.114 (2004) ("[A] bilateral treaty between the United States and Korea enables a Korean judgment to be enforced like a sister-state judgment in the United States.").

          [6].     John F. Coyle, The Treaty of Friendship, Commerce and Navigation in the Modern Era, 51 Colum. J. Transnat'l L. 302, 307-15 (2013).

          [7].     Treaty of Friendship, Commerce and Navigation, United States-Republic of Korea, art. V(1), Nov. 28, 1956, 8 U.S.T. 2217; Treaty of Friendship, Commerce and Navigation, United States-Greece, art. VI(1), Aug. 3, 1951, 5 U.S.T. 1829.

          [8].     Charles H. Sullivan, U.S. Dep't of State, Standard Draft Treaty of Friendship, Commerce and Navigation 98 (1981).

          [9].     988 F.2d 104, 105 (11th Cir. 1993).

        [10].     Vagenas, 988 F.2d at 105-06.

        [11].     Id. at 106-07.

        [12].     See id. at 106 ("Because the Friendship Treaty is the supreme law of the land, it effectively obligated the states to afford a Greek national the same treatment that any United States citizen would receive in an action to enforce a judgment." (citation omitted)).

        [13].     Cf. Jerome A. Hoffman, Recognition by Courts in the Eleventh Circuit of Judgments Rendered by Courts of Other Countries, 29 Cumb. L. Rev. 65, 92-94 (1999).

        [14].     This is consistent with the approach adopted by a number of courts that have analyzed how the access-to-courts provision in certain FCN treaties interacts with the doctrine of forum non conveniens. See, e.g., Pollux Holding Ltd. v. Chase Manhattan Bank, 329 F.3d 64, 72-73 (2d Cir. 2003) (concluding that national treatment requires that a foreign plaintiff be treated only as well as a U.S. citizen residing in the foreign country in question for forum non conveniens purposes).

        [15].     Vagenas, 988 F.2d at 105.

        [16].     Id. at 107. Had the court analyzed the issue properly, the two-year statute of limitations would likely have applied to bar the suit; there is no obvious reason why a U.S. national seeking to enforce a Greek judgment in Alabama would be entitled to take advantage of the twenty-year statute of limitations that applies only where another U.S. state rendered the judgment in question.

        [17].     Sik Choi v. Hyung Soo Kim, 50 F.3d 244, 245 (3d Cir. 1995).

        [18].     Id. at 248, 250.

        [19].     The district court in this case did cite specific treaty provisions but at no point explained precisely why these provisions were relevant to the enforcement of judgments. Song v. Hyung Soo Kim, Civ. A. No. 93-19, 1993 WL 526340, at *5 (D.N.J. Dec. 16, 1993).

        [20].     Daewoo Motor Am., Inc. v. Gen. Motors Corp., 459 F.3d 1249, 1254-55 (11th Cir. 2006).

        [21].     Id. at 1259 (citation omitted).

        [22].     Otos Tech Co. v. OGK Am., Inc., 653 F.3d 310, 312-13 (3d Cir. 2011) (quoting Sik Choi v. Hyung Soo Kim, 50 F.3d 244, 248 (3d Cir. 1995)).

        [23].     LG Display Co. v. Obayashi Seikou Co., 919 F. Supp. 2d 17, 32 n.15 (D.D.C. 2013); see also Reply Brief on Behalf of Plaintiff-Appellant at 34, Sung Hwan Co. v. Rite Aid Corp., 850 N.E.2d 647 (N.Y. 2006) (No. 112444/01), 2006 WL 1662418, at *22.

        [24].     Petitioner's Brief on Jurisdiction at 7, Strout v. Campbell, 872 So. 2d 899 (Fla. 2004) (No. SC04-183), 2004 WL 531786, at *8; see also Brief of Appellants at 64, Osorio v. Dow Chem. Co., 635 F.3d 1277 (11th Cir.) (No. 10-11143), 2010 WL 6402939, at *64; Beacon Products Corp. v. Reagan, 633 F. Supp. 1191, 1193 (D. Mass. 1986).

        [25].     Weintraub, supra note 5, at 167-68.

        [26].     Teitz, supra note 5, at 55 n.228.

        [27].     E.g., Treaty of Friendship, Commerce and Navigation, United States-Greece, supra note 7, 5 U.S.T. at art. VI(1).

        [28].     Council Regulation 44/2001, On Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters, art. 33(1), 2001 O.J. (L 12) 10.

        [29].     Other provisions in various FCN treaties do use the phrase "execution of judgments." E.g., Treaty of Friendship, Commerce and Navigation, United States-Greece, supra note 7, 5 U.S.T. at art. XIV(5). But the language is used only in the context of defining the scope of a state's sovereign immunity. The use of this language in the sovereign immunity context-but not in the access-to-courts context-further confirms that the latter provision was not intended to address the question of judgments.

        [30].     Robert R. Wilson, Access-to-Courts Provisions in United States Commercial Treaties, 47 Am. J. Int'l L. 20 (1953).

        [31].     Sullivan, supra note 8.

        [32].     Id. at 100.

        [33].     See Vaughan Black, A Canada-United States Full Faith and Credit Clause?, 18 Sw. J. Int'l L. 595, 602 (2012); Jens Dammann & Henry Hansmann, Globalizing Commercial Litigation, 94 Cornell L. Rev. 1, 44 n.141 (2008); Hoffman, supra note 13, at 92­-94.

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