Genujo Lok Beteiligungs Gmbh v. Zorn

• Decision Date: 18 March 2008
• Docket Number: Docket: Cum-07-350.
• Citation: 943 A.2d 573,2008 ME 50
• Parties: GENUJO LOK BETEILIGUNGS GMBH v. Manfred ZORN.
• Court: Maine Supreme Court

943 A.2d 573

2008 ME 50

GENUJO LOK BETEILIGUNGS GMBH v. Manfred ZORN.

Docket: Cum-07-350.

Supreme Judicial Court of Maine.

Submitted on Briefs: January 24, 2008.

Decided: March 18, 2008.

David B. McConnell, Esq., Stephanie A. Williams, Esq., Perkins Thompson, P.A., Portland, ME, for Manfred Zorn.

Bruce W. Hepler, Esq., Law Offices of Bruce W. Hepler, Portland, ME, for Genujo Lok Beteiligungs GmbH.

Panel: CLIFFORD, ALEXANDER, LEVY, SILVER, MEAD, and GORMAN, JJ.

ALEXANDER, J.

[¶ 1] Manfred Zorn appeals from a judgment entered in Superior Court (Cumberland County, Warren, J.) denying his motion for an evidentiary hearing and holding that a German judgment entered against him is entitled to recognition and enforcement in Maine, pursuant to the Uniform Foreign Money-judgments Recognition Act, 14 M.R.S. §§ 8501-8509 (2007) (Recognition Act), and the Uniform Enforcement of Foreign Judgments Act, 14 M.R.S. §§ 8001-8008 (2007) (Enforcement Act). We affirm the judgment.

I. CASE HISTORY

[¶ 2] Zorn worked in Germany as a freelance broker on the Frankfurt Securities Exchange. His work included settling security transactions through Lombardkasse AG, a German company that is now known as GENUJO LOK Beteiligungs GmbH. When Zorn was engaged in business with Lombardkasse, his sole domicile was Maine.

[¶ 3] In the course of his transactions with Lombardkasse, Zorn incurred a debt of 2.4 million deutsche marks (DM) to the company. On May 18, 1998, Zorn executed and delivered to Lombardkasse a German notarized recognition of debt, also known as an enforceable deed, which is similar to a settlement agreement in Maine. In the recognition of debt, the parties agreed that Zorn would pay Lombardkasse 1.6 DM, according to an agreed repayment plan, as settlement for Lombardkasse's claim. The agreement included the following relevant conditions: (1) the acknowledgement of indebtedness shall itself provide the basis for Zorn's liability; (2) with respect to the payment of a partial amount of the overall debt in the amount of 1.6 DM, Zorn is liable to the immediate compulsory attachment of his entire assets; (3) Zorn expressly waives the right to all forms of appeal concerning the basis or the amount of the debt; (4) if Zorn fails to comply with the repayment plan, he must pay back the remaining amount of the original 2.4 DM debt; (5) all claims arising in connection with or as a result of the agreement or claims relating to its validity are subject to German law; and (6) the place of jurisdiction for all disputes arising in connection with or as a result of the agreement or disputes relating to its termination or validity shall be Frankfurt am Main, Germany. Zorn had no significant assets in Germany when the parties entered into the recognition of debt.

[¶ 4] Zorn repaid 358,576.46 DM but failed to comply with the remainder of the repayment plan, leaving 2,041,423.54 DM unpaid. Because Zorn agreed in the recognition of debt to compulsory attachment of his assets, the recognition of debt was automatically enforceable in Germany.¹ Zorn's only assets were in the United States. Therefore, Lombardkasse instituted court proceedings in Frankfurt am Main, Germany to obtain a judgment, which it could then seek to enforce in the United States.

[¶ 5] Lombardkasse served Zorn in the United States on August 19, 2003. Zorn appeared before the Frankfurt am Main Regional Court, through his German attorney, and raised a number of jurisdictional and substantive arguments, including (1) the Frankfurt am Main Regional Court lacked jurisdiction; (2) Zorn was disadvantaged during the notarization of the deed because he was not represented by an attorney; (3) the recognition of debt was meant to apply in the event of Zorn's success in another lawsuit and thus did not create any new grounds for indebtedness; and (4) Lombardkasse had no legitimate interest in taking legal action. The Frankfurt am Main Regional Court rejected Zorn's arguments² and issued a judgment on May 10, 2004, ordering Zorn to satisfy the debt, plus interest, and to pay the costs of the lawsuit.³ Landgericht [LG] [Trial Court] May 10, 2004 (F.R.G.). The court issued the judgment to GENUJO LOK Beteiligungs GmbH, as Lombardkasse's successor, for the purpose of judicial enforcement.

[¶ 6] Zorn appealed that decision to the Frankfurt am Main Higher Regional Court, which affirmed the judgment on May 25, 2005. Oberlandesgericht [OLG] [Court of Appeals] May 25, 2005 (F.R.G.). The Frankfurt am Main Regional Court then issued two orders, on June 15, 2005 and July 29, 2005, fixing the costs that Zorn was obligated to pay pursuant to its May 10, 2004 decision and the appellate court's decision of May 25, 2005, affirming that decision. Landgericht [LG] [Trial Court] June 15, 2005 (F.R.G.); Landgericht [LG] [Trial Court] July 29, 2005 (F.R.G.).

[¶ 7] On March 17, 2006, Lombardkasse filed the four German decisions with the clerk of the Cumberland County Superior Court, pursuant to the Enforcement Act, 14 M.R.S. §§ 8001-8008, and authenticated in accordance with M.R. Civ. P. 44(a)(2). Zorn filed a motion raising grounds for nonrecognition of the German judgments and requesting an evidentiary hearing on this issue. The court denied Zorn's request for a hearing, after considering his substantive arguments against recognition and determining that Zorn did not raise any issues that could not be resolved in the absence of an evidentiary hearing. The court held that GENUJO LOK was entitled to commence enforcement proceedings in Maine.

[¶ 8] Zorn filed a timely notice of appeal.

II. LEGAL ANALYSIS

[¶ 9] The Enforcement Act creates an expedited procedure for enforcing federal and state judgments that are entitled to full faith and credit in Maine. 14 M.R.S. § 8002. Any such judgment that is properly authenticated and filed with the clerk of the court "has the same effect and is subject to the same procedures, defenses and proceedings for reopening, vacating or staying as a judgment of [a court] of this State and may be enforced or satisfied in like manner." 14 M.R.S. § 8003.

[¶ 10] In contrast, the Recognition Act applies to judgments entered in foreign countries. Unless one of the statutory grounds for nonrecognition applies, a foreign country judgment that is "final, conclusive and enforceable where rendered," 14 M.R.S. § 8503, is considered conclusive between the parties to the extent that it grants or denies recovery of a sum of money and "is enforceable in the same manner as the judgment of a sister state that is entitled to full faith and credit." 14 M.R.S. § 8504. Section 8505, entitled "Grounds for nonrecognition," lists three grounds upon which "[a] foreign judgment is not conclusive,"⁴ 14 M.R.S. § 8505(1), and seven grounds upon which "[a] foreign judgment need not be recognized,"⁵ 14 M.R.S. § 8505(2).

A. Meaning of "foreign judgment"

[¶ 11] Zorn argues that the court erred in recognizing the German judgments because the recognition of debt is not a "foreign judgment" within the meaning of the Recognition Act, 14 M.R.S. § 8502(2), 8503. Zorn's argument is misplaced. The issue is not whether the recognition of debt itself qualifies as a "foreign judgment," but whether the four German decisions, enforcing the recognition of debt, are "foreign judgments" and therefore entitled to recognition.

[¶ 12] The Recognition Act applies to "foreign judgments," 14 M.R.S. § 8503, which it defines as "any judgment of a foreign state granting or denying recovery of a sum of money, other than a judgment for taxes, a fine or other penalty or a judgment for support in matrimonial or family matters." 14 M.R.S. § 8502(2). We review the interpretation of a statute de novo. State v. Diecidue, 2007 ME 137, ¶ 10, 931 A.2d 1077, 1080; Alexandre v. State, 2007 ME 106, ¶ 14, 927 A.2d 1155, 1159. When language is unambiguous, we give it its plain meaning. See Kapler v. Kapler, 2000 ME 131, ¶ 17, 755 A.2d 502, 508.

[¶ 13] In this case, the May 10, 2004 decision of the Frankfurt am Main Regional Court falls within the plain meaning of a "foreign judgment" as it is defined in 14 M.R.S. § 8502(2). The May 10, 2004 decision is titled "Judgement [sic];" was issued by a foreign court and bears the seal of that court; grants recovery of a sum of money; and is not "a judgment for taxes, a fine or other penalty or a judgment for support in matrimonial or family matters." 14 M.R.S. § 8502(2). Therefore, the court did not err in concluding that the May 10, 2004 judgment qualifies as a foreign judgment within the meaning of the Maine Recognition Act, 14 M.R.S. § 8502(2).⁶

B. Whether German decisions are entitled to recognition

[¶ 14] Zorn raised three grounds for nonrecognition: (1) "[t]he judgment was rendered under a system that does not provide ... procedures compatible with the requirements of due process of law," 14 M.R.S. § 8505(1)(A); (2) "[t]he foreign court did not have personal jurisdiction over the defendant," 14 M.R.S. § 8505(1)(B); and (3) "[t]he foreign court rendering the judgment would not recognize a comparable judgment of this State," 14 M.R.S. § 8505(2)(G).

[¶ 15] While each of these issues involve factual questions, or mixed questions of fact and law, on this record Zorn has not established that there is any material fact that he can dispute regarding the grounds for nonrecognition that he asserts. We proceed to address those three grounds.

1. Due Process

[¶ 16] Zorn argues that the court erred in recognizing the German judgments because the German proceedings did not comport with the requirements of due process of law. Pursuant to 14 M.R.S. § 8505(1)(A), a foreign judgment is not conclusive if "[t]he judgment was rendered under a system that does not provide impartial tribunals or procedures compatible with the requirements of due process of law." In interpreting language identical to that found in the Recognition Act, courts have consistently read this section to require a determination of...