Savage v. Zelent and N.C.'s Foreign-Country Money Judgments Recognition Act

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In Savage v. Zelent,[1] the North Carolina Court of Appeals decided an issue of first impression, upholding the trial court’s recognition of an £148,516.75 attorneys’ fee award from Scotland.[2] While Scottish Courts follow a “loser pay” attorney’s fees system, North Carolina does not have such a rule and believes that each party in a lawsuit should pay its own expenses with some statutory exceptions.[3] Nevertheless, the North Carolina Foreign-Country Money Judgments Recognition Act (NCFCMJRA) allows courts to recognize judgments of foreign courts.[4] 

The Uniform Foreign-Country Money Judgment Recognition Act of 1962 (UFCMJRA of 1962) codified common law rules that recognized money judgments made in other countries.[5] The intent of the UFCMJRA of 1962 was to gain reciprocity in foreign courts so that money judgments allowed in one state would be treated the same in a foreign country. Essentially, the UFCMJRA of 1962 recognizes a “judgment by a court of a foreign country that grants or denies recovery of a sum of money, other than for taxes, fines, or domestic support.”[6] The judgment also has to be “final, conclusive, and enforceable under the law of that country, unless one of the grounds for non-recognition specified in the Uniform Act applies.”[7] The UFCMJRA of 1962 stipulated three mandatory, and eight discretionary, grounds for non-recognition.[8] In 2005, the National Conference of Commissioners on Uniform State Laws revised the UFCMJRA of 1962, and in 2009, North Carolina revised its Act in accordance with the revision and additions of the 2005 Act. Formally, the NCFCMJRA is a new statute with some departures from, and additions to, the 1962 Act. The practical effects, however, are the same.

North Carolina General Assembly
Responding to recent revisions of the Uniform Foreign-Country 
Money Judgment Recognition Act of 1962, the N.C. General Assembly's  
related Act is  already taking effect. Photo via Wikimedia Commons.

In Savage v. Zelent, the defendant, Zelent, a former girlfriend of Savage, alleged that a Scottish judgment awarded in Savage’s favor for attorney’s fees should not be recognized in North Carolina because the judgment occurred in connection with a domestic suit and was against public policy.[9] The North Carolina Court of Appeals interpreted two subdivisions of the revised NCFCMJRA. The North Carolina Court of Appeals interpreted subdivision (b)(3), which contains modified language from the previous North Carolina Act, and subdivision (c)(7), a new provision.[10] In subdivision (b)(3), the General Statutes Commission substituted “alimony, support, or maintenance in matrimonial or family matters” for the Uniform Act language “divorce, support, or maintenance, or other judgment rendered in connection with domestic relations.”[11] The court held that they would not read the statute to substitute the word “for” and replace it with the phrase “arising out of,” keeping the statute from reading “judgment [arising out of] a claim for alimony, support, or maintenance,” and allowing the Scottish judgment, rather, to remain a judgment “for” attorneys' fees and expenses incurred by plaintiff and awarded against defendant.[12]

The North Carolina Court of Appeals then interpreted subsection 4(c)(7) of the NCFCMJRA to determine if the Scottish judgment was repugnant to North Carolina public policy.[13] Zelent argued that the Auditor had doubt about the fairness of the calculation of expenses.[14]   Under 4(c)(7), “the forum court may deny recognition to a foreign-country judgment if there are circumstances that raise substantial doubt about the integrity of the rendering court with respect to that judgment.”[15] Official Comment 11 to subsection (c)(7) further states that denial of recognition of the foreign judgment under this subsection “requires a showing of corruption in the particular case that had an impact on the judgment that was rendered.”[16] Therefore the court held that “even if the Auditor had doubt about the fairness of expenses, such doubt does not rise to the level of ‘corruption in the particular case’ required to deny recognition.”[17]

The decision in the Savage case shows that North Carolina courts have a presumption for enforcing foreign court judgments, and have been consistent and uniform in enforcing awards of attorney’s fees.[18] Currently, eighteen states have adopted the 2005 Uniform Foreign Country Money Judgment Recognition Act. [19] Massachusetts has a bill pending in the legislature to enact the 2005 Act, and is believed to be “a corrective bill . . . [that] if adopted, would promote both predictability and sound public policy with respect to the enforcement of foreign judgments in the Commonwealth.”[20] In a broader context, this interpretation of the 2005 Uniform Foreign Country Money Judgment Act suggests that United States courts, in particular North Carolina are not parochial.



[1] 777 S.E.2d 801 (N.C. Ct. App. 2015), review denied, No. 394P15, 2016 WL 1103697 (N.C. Mar. 17, 2016). 

[2] Mica Nguyen Worthy, Scottish Judgment Worth £148,516 Not Repugnant To NC Law, 25 Int’l L. & Practice of N.C. Bar Ass’n 2 (Dec. 2015). 

[3] Savage supra note 1, at 809 ("North Carolina statutory law explicitly authorizes the award of attorneys' fees in domestic relations matters.”).

[4] N.C. Unif. Foreign-Country Money Judgments Recognition Act, N.C. Gen. Stat. § 1C-1853 (2015).

[5] Unif. Foreign-Country Money Judgments Recognition Act, 13 U.L.A. pt. II (Supp. 2007).

[6] The Legal Opinions Committee, ABA Business Law Section, Cross-Border Closing Opinions of U.S. Counsel, 71 Bus. L. 139, 186-88 (2016). 

[7] Id. 

[8] The Legal Opinions Committee, ABA Business Law Section, Cross-Border Closing Opinions of U.S. Counsel, 71 Bus. L. 139, 186-88 (2016).

[9] Savage supra note 1, at 804.

[10] Savage supra note 1, at 804.

[11] Savage supra note 1, at 804-06.

[12] Savage supra note 1, at 804-06.

[13] Savage supra note 1, at 809-10.

[14] Savage supra note 1, at 810.

[15] N.C. Gen. Stat. Ann. § 1C-1853

[16] Savage supra note 1, at 808.

[17] Savage supra note 1, at 808.

[18] See, e.g., In re Marriage of Vardi & Eliahu, No. H041414, 2015 WL 8770069, 1 (Cal. Ct. App. Dec. 14, 2015), as modified on denial of reh'g (Jan. 11, 2016) (affirming the trial court’s recognition of an award of attorney’s fees).

[19] Paul B. Stephan, Foreign Court Judgmentsand the United States Legal System 103 (2014). 

[20] Jonathan W. Fitch, Foreign Judgments Recognition Law Due for Update, Sally & Fitch LLP Blog (Oct. 11, 2012), http://www.sally-fitch.com/blog/2012/10/foreign-judgments-recognition-law-due-for-update.shtml [https://perma.cc/7KA3-D6NC].  



Posted by Alexandra J. Portaro on Thu. April 7, 2016 10:17 AM
Categories: North Carolina

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