Servis-Terminal LLC v Valeriy Ernestovich Drelle

Servis-Terminal LLC v Valeriy Ernestovich Drelle

An unrecognised foreign judgment does not constitute a legally enforceable debt for the purposes of section 267 of the Insolvency Act 1986 and cannot found a bankruptcy petition in England and Wales. The exercise of foreign sovereign power through judgment has no direct operation in this jurisdiction unless and until recognition proceedings are undertaken.

Parties
Respondent to the Appeal / Petitioner: Servis-Terminal LLC; Appellant / Respondent to the Petition: Valeriy Ernestovich Drelle
Jurisdiction
England and Wales
Judgment Date
31 January 2025
Procedural Posture
Civil Appeal / Court of Appeal Judgment
Outcome
Appeal allowed; bankruptcy order set aside; bankruptcy petition dismissed.
Legal Topics
Recognition and Enforcement of Foreign Judgments, Bankruptcy Petitions, Foreign Sovereign Power, Liquidated Debt Requirements
Insolvency Conflict of Laws Bankruptcy Recognition and Enforcement of Foreign Judgments Bankruptcy Petitions Foreign Sovereign Power Liquidated Debt Requirements

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Parties

Servis-Terminal LLC

Respondent to the Appeal / Petitioner

Valeriy Ernestovich Drelle

Appellant / Respondent to the Petition

Procedural Posture

Civil Appeal / Court of Appeal Judgment

Legal Issues

  1. 1 Whether an unrecognised foreign judgment can found a bankruptcy petition in England and Wales
  2. 2 Whether a foreign judgment not subject to recognition proceedings constitutes a 'debt' under section 267 of the Insolvency Act 1986

Ratio Decidendi

An unrecognised foreign judgment does not constitute a legally enforceable debt for the purposes of section 267 of the Insolvency Act 1986 and cannot found a bankruptcy petition in England and Wales. The exercise of foreign sovereign power through judgment has no direct operation in this jurisdiction unless and until recognition proceedings are undertaken.

Court Disposition

Appeal allowed; bankruptcy order set aside; bankruptcy petition dismissed.

Orders

  • The bankruptcy order made by ICC Judge Burton is set aside.
  • The bankruptcy petition against Mr Drelle is dismissed.