ART. 57 OF E.U. REGULATION 44/2001:
AUTHENTIC ISSUES OF HUMAN RIGHTS ?
AN ARTICLE BY GREGORY TAYLOR
[NOTE : This article will soon be updated to take into account Regulation (EC) 805/2004 of 21 April 2004 relating to European Enforcement Orders for uncontested claims, which applies from 21 October 2005. To download the new Regulation in PDF format, click HERE ]
EU Council Regulation (EC) No. 44/2001 of 22 December 2000 came into force on 1st March 2002 [to download the full text of the Regulation in PDF format, click HERE]. At first sight, a Regulation describing itself as dealing with jurisdiction and the recognition and enforcement of judgments in civil and commercial matters may seem to have little or no relevance to Notarial acts, which are not "given by a court or tribunal", and although Notaries are appointed by a Court or other lawful authority, they are independent and therefore not "officers of the court" (Art. 32). Turning however to Art. 57.1, we find : "A document which has been formally drawn up or registered as an authentic instrument and is enforceable in one Member State shall, in another Member State, be declared enforceable there...".
Oddly, the Regulation does not define the term "authentic instrument", but by Art. 57.3, the document must satisfy the conditions necessary to establish its authenticity in the EU Member State of origin. The concept of an "authentic instrument", being unknown to the common law, has no practical meaning in England and Wales. However, other "equally authentic" versions of the Regulation translate the term as : German - öffentliche Urkunden ("public certifications") ; French - actes authentiques ("authentic acts") ; Spanish - documentos públicos ("public documents") ; Italian - atti pubblici ("public acts").
The Regulation states that an "authentic instrument" within Art. 57.1 and which is enforceable in the Member State of origin can be enforced in another Member State if it has also been declared enforceable in that other Member State (and in the case of the UK, in the relevant jurisdiction within the UK).
In the Continental European "civil-law" jurisdictions, Notarial acts can give a valid title for enforcement, provided that they are in "public" form. An example : A German contract for the purchase of land must be entered into in the form of a Notarial "public" act, and in the document, the parties can submit to enforcement in the event of default by either party. If the buyer defaults in payment, the seller can enforce in Germany his rights against the buyer without recourse to the Courts, as the contract operates as an acknowledgment of indebtedness by the buyer. Supposing the buyer has moved to, say, England, then the Regulation provides for the acknowledgment to be directly enforced in England, subject to the procedures laid down in the Regulation, i.e. a certificate of enforceability (Annex VI) by the German Notary (as the "competent authority", within Art. 57.4, of the Member State of origin), followed by a certificate of enforceability by the "court or competent authority" (Art. 57.1) in England, i.e. the High Court of Justice (Annex V). It is clear from the prescribed form of the Notary's Annex VI certificate, which refers to "creditor" and "debtor", that the enforcement can only be in relation to a liquidated, i.e. already ascertained, sum of money, such as would otherwise be the subject of a debt action if Court proceedings were required.
Such cross-border enforceability of Continental European contracts could be used in almost any contractual situation, i.e. in addition to those cases specifically prescribed by national law (such as real estate transactions in Germany), provided that the contract is entered into in Notarial "public" form. There can be no doubt that "civil-law" EU Notaries will increasingly seek to apply in other EU jurisdictions, including England and Wales, enforcement provisions contained in their own Notarial acts, through the simple device of drawing up contractual documents in Notarial "public" form.
Art. 57.1 requires that the document be "formally drawn up or registered as an authentic instrument". While the term "formally" is also not defined in the Regulation, it is simply taken for granted by "civil-law" jurisdictions that Notarial acts drawn up in "public" form come within the Regulation, even though the word "Notary" does not appear in the Regulation.
As mentioned above, the term "authentic instrument" has little or no meaning in "common-law" jurisdictions, such as England and Wales, whose legal culture has been based since the Magna Carta of 1215 on the principle of "due process of law", i.e. on the determination of legal rights and obligations by the Courts. Our Human Rights Act 1998, which incorporates into UK law the European Convention on Human Rights ("ECHR"), can therefore be seen as a formal statutory codification of a centuries-old legal and social principle. Art. 6 ECHR states : "In the determination of his civil rights and obligations..., everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law". The often-cited advantage of an enforceable Notarial "public" act is that it avoids the necessity for Court proceedings, however it is precisely this "advantage" which makes it vulnerable to attack under Art. 6 ECHR. It may well be that the debtor has the right to have enforcement stayed and/or amended or revoked by application to the Court in the original Member State, but this is an entirely separate right to that guaranteed by Art. 6 ECHR, which requires that the determination of the obligation is itself effected by due process of law, i.e. by a Court.
The Courts in the UK are increasingly extending the application of the Human Rights legislation and principles into areas which involve property and commercial issues. Art. 57.1 of the Regulation states that the court with which an appeal is lodged against the decision on an application for a declaration of enforceability shall refuse or revoke such a declaration only if enforcement of the instrument is "manifestly contrary to public policy" in the Member State addressed. It is submitted that our Courts will probably hold that a prima facie breach of Art. 6 ECHR renders the enforcement of Notarial "public" acts "manifestly contrary to public policy", i.e. on the basis that such acts purport to create extra-judicial remedies.
It is even possible that Notarial acts containing enforcement provisions might not be enforceable at all in any EU jurisdiction which has incorporated the ECHR into its own national legislation. In any event, we will have to wait and see how the Courts, both here and in other EU jurisdictions, will seek to strike the right balance between commercial practicalities and reciprocity within the European single market, on the one hand, and the consistent upholding of human rights throughout the European Union, on the other hand.
Gregory Taylor [Notary Public]