The Great Change: Turning Cathy into a Lawyer

In my Conflict of Laws course we (also) have been discussing not only how US and EU law differs in judicial procedures, but also how these differences create conflicts that may arise in a particular matter.

Today's discussion focused on recognition of judgments. Say a French court awards you $20,000. Can you go to an American court and have the American court enforce the order? Generally, yes. But then it can get complicated.

If you had an injury worth $100,000 in damages, you could go to court and either sue for the whole thing, or you could "test the waters" and only ask for $20,000. This kind of "testing" may often happen in Europe because of the matter of legal fees: they are frequently awarded to the winner and are calculated based on the damages asserted. In other words, the bigger the damage claim, the more attorneys' fees. Which is great if you win, and not great if you lose. So it may be worth filing a small claim as a test balloon, so that if you lose, you won't have to pay so much in fees. And then if you win, in France (as an example, as this is true in other places), you can go back and sue again for the rest of the amount.

Such a strategy is unheard of in the US, however, because of our notion of res judicata. Res judicata basically means that you get one change to have the issue heard on the merits. After that, you are precluded from raising the issue again. This not only applies to issues actually raised, but also issues that were so related they could have (and should have) been raised too. A similar situation played out in the US would mean that a plaintiff with a $100,000 injury who only asks for $20,000, and wins, would be stuck with a $20,000 award and have forfeited any claim to the other $80,000. (I suppose clever lawyers might find creative procedural ways of getting around this, but this is the general way things work.)

But in terms of foreign judgments, the complication arises. The plaintiff who won in France might come to the US to enforce the judgment. But because in France he could still sue for the other $80,000, he could still do that in the US too. In fact, if he had jurisdiction to sue for the whole $100,000 in the US, he could conceivably win an $100,000 award PLUS also enforce the $20,000 French judgment. The American concept of res judicata wouldn't apply, and only unjust enrichment (to prevent double collection) would be available to keep the plaintiff from getting $120,000 off of an $100,000 injury. (In a trial situation, a defense lawyer would raise the issue and it would probably get sorted out. However, if the defendant didn't appear – as may well happen for jurisdictional and procedural reasons – it would only be a very lengthy, after the fact, action by the defendant that could set things right.)

I find this situation problematic. Without commenting on the French logic of allowing test balloon cases, it seems like a more just way of dealing with these judgments in the US would be to treat the French judgments as final entities. A US court could then say, "France says you are entitled to $20,000? OK, we'll help you get it." Then if the plaintiff went back to France for the other $80,000, it would look to an American court like a discrete judgment also enforceable in the US. The problems, I think, arise when the US courts instead have to apply French law on the finality of judgments (they are much less final there than they are in the US) in order to enforce them in the US, which leads to American courts having to enforce results that would otherwise be impermissible under American jurisdiction.

Note, I'm not saying that the US shouldn't recognize French decisions as binding and valid, or refuse to enforce them at all. I just think that allowing their enforcement in the US should be a much more narrow judicial enterprise, dealing with each judgment as a finite result and not a piece of an entire process.