High Court grants summary judgment instead of default judgment to aid enforcement abroad

In a recent decision, the High Court granted summary judgment in favour of a bank on its debt claim under a credit agreement, in circumstances where the foreign-domiciled borrower failed to file an acknowledgement of service or a defence. The court approved the bank's request for summary judgment, instead of the usual remedy in these circumstances of default judgment, on the basis that it would be more readily enforceable (particularly in other jurisdictions): Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden NV v Societe Bengaz SA & Anor [2024] EWHC 901 (Comm).

The decision is a useful reminder that the court has a discretion under CPR 24.4(1) to allow a claimant to apply for summary judgment, instead of default judgment, where the defendant has not responded to the claim. In the present case, two important factors influencing the court's decision related to enforceability: (i) it might be necessary for the claimant to enforce any judgment obtained overseas given the cross-border nature of the claims; and (ii) the foreign borrower failed to give any asset disclosure and therefore it was important for the claimant to ensure it had the best possible chance of enforcing the judgment in other jurisdictions (given it did not know the location of the borrower's assets).

For more information, see this post on our Banking Litigation Notes blog.