The Supreme Court has held that an approximately €6.33 million Polish judgment obtained by Irish company Coucal Limited against Michael Scully should not be refused recognition in Ireland on public-policy grounds arising from the assignment of investors’ claims.
The dispute traces back to an investment project in Opole, Poland. Around 2006, a group of investors put money into a Polish company developing a shopping centre. The investors later alleged that transactions arranged by Scully left them with the loss of their entire investment. Those allegations were ultimately accepted by the Polish Court of Appeal, which in June 2021 entered judgment for Coucal for PLN 28,391,106.
Coucal had been established by investors to pursue their claims. They individually assigned their causes of action to the company under Polish law, where the assignments were valid.
Scully resisted recognition of the judgment in Ireland. He argued that the assignments offended Irish rules against maintenance, champerty and the trading of bare causes of action. The High Court rejected that argument, but the Court of Appeal later held that recognition should be refused because the assignment documents appeared to permit onward transfer of the claims to an unconnected third party.
Mr Justice Gerard Hogan, delivering the Supreme Court judgment, disagreed with that approach.
He said EU rules require judgments from other member states to be recognised unless enforcement would be manifestly contrary to a fundamental rule of public policy. That is an exceptional test.
Even assuming the assignments would have been invalid under Irish law, the court held that Ireland’s concerns relate mainly to the conduct and funding of litigation in Irish courts before judgment. Poland takes a different approach and permits this type of assignment in commercial cases.
The court therefore concluded that those differences did not justify refusing recognition of the Polish judgment.
The appeal was to be allowed on that issue. However, the Supreme Court left open a separate argument concerning Polish judicial independence and indicated that further submissions might be required before final disposal.