A foreign Court is defined as a court situate outside India and not established or continued by the authority of the Central Government. And a Foreign Judgment means a judgment of a foreign court. Sections 13 and 14 of CPC enact a rule of res judicata in case of foreign judgments. These provisions embody the principle of private international law that a judgment delivered by a foreign court of competent jurisdiction can be enforced by an Indian court and will operate as res judicata between the parties thereto except in the cases mentioned in Section 13 of CPC and subject to the other conditions mentioned in Sec. 11 of C.P.C. The rules laid down in this section are rules of substantive law and not merely of procedure. The fact that the foreign judgment may fail to show that every separate issue, such as, the status of the contracting parties, or the measure of damages, was separately framed and decided, is irrelevant unless it can be shown that failure brings the case within the purview of one of the exceptions to Section 13 of CPC.

The judgment of a foreign court is enforced on the principle that where a court of competent jurisdiction has adjudicated upon a claim, a legal obligation arises to satisfy that claim. The rules of private international law of each State must in the very nature of things differ, but by the comity of nations certain rules are recognized as common to civilized jurisdictions. Through part of the judicial system of each State these common rules have been adopted to adjudicate upon disputes involving a foreign element and to effectuate judgments of foreign courts in certain matters, or as a result of international conventions. Such recognition is accorded not as an act of courtesy but on considerations of justice, equity and good conscience. An awareness of foreign law in a parallel jurisdiction would be a useful guideline in determining our notions of justice and public policy. We are sovereign within our territory but “it is no derogation of sovereignty to take account of foreign law.”

Jurisdiction to Foreign Courts

1. The following circumstances would give jurisdiction to foreign courts: 1. Where the person is a subject of the foreign country in which the judgment has been obtained;
2. Where he was a resident in the foreign country when the action was commenced and the summons was served on him;
3. Where the person in the character of plaintiff selects the foreign court as the forum for taking action in which forum he issued later;
4. Where the party on summons voluntarily appeared; and
5. Where by an agreement, a person has contracted to submit himself to the forum in which the judgment is obtained.

Binding Nature of Foreign Judgments:

The Code of Civil Procedure provides that a foreign judgment shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title except –
a) Where it has not been pronounced by court of competent jurisdiction;
b) Where it has not been given on the merits of the case;
c) Where it appears on the face of the proceeding to be founded on an incorrect view of international law or a refusal to recognize the law of India in cases in which such law is applicable;
d) Where the proceeding in which the judgment was obtained or opposed to natural justice;
e) Where it has been obtained by fraud;
f) Where it sustains a claim founded on a breach of any law in force in India

The leading case on the point is Gurdayal Sigh v. Rajah of Faridkot. In this case, A filed a suit against B in the court of the Native State of Faridkot, claiming Rs. 60,000 alleged to have been misappropriated by B, while he was in A’s service at Faridkot. B did not appear at the hearing, and an ex parte decree was passed against him. B was a native of another Native State Jhind. In 1869, he left Jhind and went to Faridkot to take up service under A. But in 1874, he left A’s service and returned to Jhind. The present suit was filed against him in 1879; when he neither resided at Faridkot nor was he domiciled there. On these facts, on general principles of International Law, the Faridkot court had no jurisdiction to entertain a suit against B based on a mere personal claim against him. The decree passed by the Faridkot court in these circumstances was an absolute nullity. When A sued B in a court in British India, against B on the judgment of the Faridkot court, the suit was dismissed on the ground that Faridkot court has no jurisdiction to entertain the suit. The mere fact that the embezzlement took place at Faridkot, was not sufficient to give jurisdiction to the Faridkot court would have had complete jurisdiction to entertain the suit and to pass a decree against him.

However, the mere fact of a decree being ex parte will not necessarily justify a finding that it was not on merits. The real test for deciding whether the judgment has been given on merits or not is to see whether it was merely formally passed as a matter of course, or by way of penalty for any conduct of the defendant, or is based upon a consideration of the truth or falsity of the plaintiff’s claim, notwithstanding the fact that the evidence was led by him in the absence of the defendant.