Sunday, January 01, 2012

Audit 4: Take a Second Look at Arbitration for Contract Dispute Resolution

Whatever the type of your cross-border agreements, it is dangerous to assume that a court judgment from a convenient and familiar local court would be enforceable against a foreign party with assets in another country. 

It is one thing if the foreign party has in-country assets (say in the US) that can be attached locally (such as in domestically enforcing a US court judgment against assets in the US). If is another matter if one needs to rely on the generosity of foreign courts to enforce a judgment.

There are generally no treaties that will require the enforcement of a foreign court judgment (except among certain groups of countries), and local courts may look to uncertain concepts such as whether the foreign court offers reciprocal enforcement and may require a re-litigation of the underlying issues.

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