The High Court has granted MGG California LLC summary judgment of $159,835,021.07 against Jacob E. Safra in proceedings to enforce a New York judgment, after deducting the net proceeds credited from the sale of a company’s California vineyard assets. The court did not determine the plaintiff’s claim for post-judgment interest, which it said would require a plenary hearing if pursued.
In a judgment delivered on 30 November 2023, Ms Justice Eileen Roberts said the New York judgment was final and conclusive and had not been challenged or stayed. Safra had signed a personal guarantee for debts owed by Spring Mountain Vineyard Inc (SMV), then provided a sworn confession of judgment agreeing that judgment could be entered without notice or a hearing if payment was not made under a forbearance agreement.
The New York court entered judgment for $192,221,090.14, plus $205 in costs and disbursements. SMV later entered Chapter 11 bankruptcy in California. Following a court-approved auction, MGG acquired substantially all of SMV’s assets, including the vineyards, with a $42m credit bid. After repayment of a separate debtor-in-possession loan, the net credit against the judgment was $32,386,274.07.
Safra argued that the vineyards and related assets were worth substantially more than the bid and that enforcing the judgment would permit an excessive recovery. He also relied on a pending motion in New York seeking to have the judgment marked satisfied, and raised objections concerning interest and the absence of a hearing before the confession judgment was entered.
Justice Roberts rejected the arguments that the confession process denied natural justice and that the judgment should not be enforced on public-policy grounds. She found Safra had knowingly and voluntarily waived notice and a hearing with legal advice. She also found no evidence, beyond the net credit bid, that the New York judgment had been satisfied. The pending satisfaction motion, even if successful, would not set aside or reverse the judgment, she said.
The court accepted that the summons should have stated the outstanding balance more clearly, but found the judgment amount and credit were identified sufficiently for Safra to understand the calculation. It specified the balance as $159,835,021.07.
The court declined to decide the interest claim summarily because its basis and calculation had not been properly particularised in the summons. It said that claim must go to a plenary hearing if the plaintiff intends to pursue it. The judge listed the matter for 14 December to hear any application by Safra for a stay, along with submissions on costs and the final form of order. The judgment records that a stay had not yet been decided.