Throwback Thursday: Hilton v. Guyot

 

Fuller Court by Clarence Dodge (1847-1914)

Justice Horace Gray is seated on the left

One hundred and thirty years ago this week, on June 3, 1895, the Supreme Court decided Hilton v. Guyot. Hilton is the seminal decision on recognizing and enforcing foreign judgments in U.S. courts. Although the federal common law rule that Hilton announced has been superseded by state law, Hilton continues to influence state rules in this area.

Hilton also gave us the classic definition of “international comity,” a principle that extends beyond foreign judgments to many other doctrines of transnational litigation. Hilton’s definition is problematic in some ways, as I shall explain. Still, it remains the standard quotation in U.S. courts. In this Throwback Thursday post, I look at Hilton and its legacy.

Debts for Gloves

Charles Fortin & Co. manufactured and sold gloves in Paris, France. A New York firm, A. T. Stewart & Co., did a lot of business with Fortin and maintained a storehouse and an agent in Paris. Between 1879 and 1882, Fortin brought several suits for unpaid bills against Stewart in French court. Stewart appeared to defend those suits and filed counterclaims against Fortin.

In 1883, the French court found in favor of Fortin on some claims and against it on others, entering judgment in Fortin’s favor for approximately 660,000 francs. Stewart appealed. In 1884, the Paris court of appeals upheld the judgment, ordering Stewart to pay additional damages of approximately 150,000 francs, plus interest and costs. In the meantime, however, Stewart withdrew its assets from France, and the judgment went unpaid.

At some point, Fortin & Co. went into liquidation. In 1885 the official liquidator, Gustave Guyot, brought suit in federal court in New York to enforce the French judgment—now amounting to just over one million francs, or approximately $195,000—against Henry Hilton and others as successors in interest to A.T. Stewart & Co.

Hilton argued that the French court was made up of businessmen rather than judges and that Charles Fortin had been a member of the tribunal until shortly before the litigation. Hilton claimed that the Stewart had appeared and counterclaimed only to protect the company’s property, which would otherwise have been seized by the French court. Hilton also claimed that Fortin & Co. presented fraudulent evidence, that witnesses were not sworn, and that cross-examination was not permitted. To this, he added that a similar U.S. judgment would not be enforced in France and that such a case would have to be tried anew there. The federal court rejected these arguments, and Hilton filed a writ of error with the Supreme Court.

The Opinion in Hilton

The opinion in Hilton was written by Justice Horace Gray. Known as the Supreme Court’s legal historian, Gray tended to write long, comprehensive opinions. Gray signaled at the outset that Hilton would be no exception, noting that the case had “been argued with great learning and ability” and required “a full consideration of the authorities.”

Of International Law and International Comity

Gray began with general remarks about international law and international comity. “International law,” he wrote, “is part of our law, and must be ascertained and administered by the courts of justice as often as such questions are presented in litigation between man and man, duly submitted to their determination.” If these words sound familiar, it may be because Gray repeated them almost verbatim five years later in The Paquete Habana (1900). In Hilton, international law referred to “‘private international law,’ or the ‘conflict of laws.’”

By the end of the nineteenth century, however, private international law had been domesticated and was not treated in the same way as public international law. So, Gray pivoted to international comity. “The extent to which the law of one nation … shall be allowed to operate within the dominion of another nation,” he wrote, “depends upon what our greatest jurists have been content to call ‘the comity of nations.’” Here, Gray was referring primarily to Justice Joseph Story, whose treatise Commentaries on the Conflict of Laws (1834) he quoted at length (while also invoking Chief Justice Roger Taney, Henry Wheaton, and Chancellor James Kent).

Gray offered his own definition of comity:

‘Comity,’ in the legal sense, is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens, or of other persons who are under the protection of its laws.

As I have noted elsewhere, this definition left many things unclear, among them whether comity actually binds U.S. courts and, if so, whether it binds them as a matter of international law or domestic law.

The Rules for Money Judgments

Gray turned next to an exhaustive discussion of cases from England and America, filling 35 pages in U.S. Reports. The common law rule, he concluded, was that in personam money judgments were only prima facie evidence of the matters they decided and could be impeached. But largely following Justice Story’s views about what the law ought to be, Gray narrowed the circumstances in which impeachment was appropriate to just a few:

where there has been opportunity for a full and fair trial abroad before a court of competent jurisdiction, conducting the trial upon regular proceedings, after due citation or voluntary appearance of the defendant, and under a system of jurisprudence likely to secure an impartial administration of justice between the citizens of its own country and those of other countries, and there is nothing to show either prejudice in the court, or in the system of laws under which it was sitting, or fraud in procuring the judgment, or any other special reason why the comity of this nation should not allow it full effect, the merits of the case should not, in an action brought in this country upon the judgment, be tried afresh, as on a new trial or an appeal, upon the mere assertion of the party that the judgment was erroneous in law or in fact.

As discussed below, this paragraph is the source for virtually all the grounds for non-recognition of foreign judgments found in U.S. law today.

Gray rejected Hilton’s argument that the French court lacked jurisdiction. The defendants did business in France and had voluntarily appeared. The arguments about not swearing witnesses and lack of cross-examination were also unavailing because these were the common practices in France. Hilton additionally argued that the judgment was impeachable for fraud, which occasioned a long discussion of the difference between extrinsic and intrinsic fraud. In the end, however, Gray found it unnecessary to decide the fraud question because the judgment was unenforceable on another ground: “the want of reciprocity, on the part of France, as to the effect to be given to the judgments of this and other foreign countries.”

Reciprocity

During his review of English and American authorities, Justice Gray noted a passage in Justice Story’s Commentaries about Holland’s practice of making reciprocity a condition for enforcing foreign judgments. “This is certainly a very reasonable rule,” Story wrote, “and may perhaps hereafter work itself firmly into the structure of international jurisprudence.” After a review of foreign practice filling another 15 pages of U.S. reports, Gray found that reciprocity had indeed done so.

[I]n Belgium, Holland, Denmark, Sweden, Germany, in many cantons of Switzerland, in Russia and Poland, in Roumania, in Austria and Hungary (perhaps in Italy), and in Spain,—as well as in Egypt, in Mexico, and in a great part of South America, the judgment rendered in a foreign country is allowed the same effect only as the courts of that country allow to the judgments of the country in which the judgment in question is sought to be executed.

Adopting this rule, Justice Gray concluded that “judgments rendered in France, or in any other foreign country, by the laws of which our own judgments are reviewable upon the merits, are not entitled to full credit and conclusive effect when sued upon in this country.” This holding was not, he continued, based on “any theory of retaliation upon one person by reason of injustice done to another, but upon the broad ground that international law is founded upon mutuality and reciprocity.” In another case decided the same day, Ritchie v. McMullen (1895), the Court recognized a Canadian default judgment after finding that Canada would recognize and enforce U.S. judgments.

The issue of reciprocity divided the Court. Chief Justice Fuller, joined by three others, dissented on the ground “that the doctrine of res judicata applicable to domestic judgments should be applied to foreign judgments as well, and rests on the same general ground of public policy, that there should be an end of litigation.” “This application of the doctrine is in accordance with our own jurisprudence,” he continued, “and it is not necessary that we should hold it to be required by some rule of international law.”

Hilton’s Influence on the U.S. Law of Judgments

Hilton was decided during the era of Swift v. Tyson (1842), when federal and state courts interpreted common law independently. As a result, state courts were not required to follow the Supreme Court’s decision in Hilton. In Johnston v. Compagnie Générale Transatlantique (1926), the New York Court of Appeals famously rejected Hilton’s reciprocity requirement and enforced a French judgment that would have been unenforceable in federal court.

Then, in Erie Railroad Co. v. Tompkins (1938), the Supreme Court declared: “There is no federal general common law.” Three years later, in Klaxon Co. v. Stentor Electrical Manufacturing Co. (1941), the Court held that federal courts sitting in diversity must follow state choice of law rules. Although the Supreme Court has never expressly so held, federal courts today assume that they similarly must follow state rules on the recognition and enforcement of foreign judgments.

In 1962, the National Conference of Commissioners on Uniform State Laws (today, renamed the Uniform Law Commission), published the Uniform Foreign Money-Judgments Recognition Act, which U.S. states began to adopt. This uniform act was updated 2005. Today twenty-nine states and the District of Columbia have enacted the 2005 uniform act, while the 1962 version remains in force nine more states. Just twelve U.S. states have adopted neither of the uniform acts.

Comparing the 1962 uniform act’s grounds for non-recognition of foreign judgments to Hilton’s language (quoted above) reveals the decision’s strong influence.

• Hilton’s phrase “a system of jurisprudence likely to secure an impartial administration of justice” became the 1962 act’s defense that “the judgment was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law.”
• Hilton’s reference to “a court of competent jurisdiction” found expression in the act’s requirements that the foreign court had personal and subject matter jurisdiction.
• Hilton’s “after due citation” became the nonrecognition ground that “the defendant in the proceedings in the foreign court did not receive notice of the proceedings in sufficient time to enable him to defend.”
• Hilton’s reference to “fraud in procuring the judgment” became the act’s fraud defense.
• Hilton’s “prejudice … in the system of laws under which [the foreign court] was sitting” translated into the public policy exception.

There are just three grounds for non-recognition in the 1962 act that have no obvious counterparts in Hilton: conflict with another final judgment, conflict with a dispute resolution clause, and jurisdiction based only on personal service when the foreign court was seriously inconvenient.

The 2005 uniform act carries forward the 1962 act’s grounds for non-recognition and adds two new ones that also echo Hilton.

• The 2005 act’s “substantial doubt about the integrity of the rendering court with respect to the judgment” corresponds to Hilton’s “prejudice in the court.”
• And the 2005 act’s ground that “the specific proceeding in the foreign court leading to the judgment was not compatible with the requirements of due process of law” matches Hilton’s “full and fair trial abroad.”

The one ground for non-recognition found in Hilton that the uniform acts did not pick up is lack of reciprocity, although five states have added such a requirement in adopting the uniform acts.

Even in the twelve states that have not enacted one of the uniform acts, Hilton continues to influence state law. Kansas is one such state. In a recent case, a federal court in Kansas recognized a judgment from Belize by applying Hilton as state common law, something Kansas state courts have similarly done.

In sum, Hilton no longer binds federal courts after Erie. But Hilton continues to rule foreign judgments from the grave through its incorporation into state statutory and common law. And that state law now binds both state and federal courts.

Hilton’s Influence on Comity

The recognition and enforcement of foreign judgments is not the only U.S. doctrine of transnational litigation based on international comity. As I have detailed here, comity is also the basis for the conflict of laws, the act of state doctrine, the presumption against extraterritoriality, forum non conveniens, the bias against antisuit injunctions, the privilege of foreign governments to bring suits in U.S. courts, the defenses of foreign state immunity and foreign official immunity, and a number of other rules.

When federal and state courts talk about comity, Hilton remains the go-to quotation. Westlaw tells me that Hilton’s definition of “comity” has been quoted in part or in full by more than 600 federal and state decisions over the past 130 years.

It is sometimes a bad fit. Although Hilton narrowly defined comity as “the recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation” (emphasis added), U.S. courts have quoted it in cases having to do instead with restraining the reach of U.S. law or the jurisdiction of U.S. courts. Hilton’s hedging about comity’s force—“neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other”—has also led U.S. courts to characterize comity doctrines as “amorphous and fuzzy.”

The Restatement (Fourth) of Foreign Relations Law (2018) now offers a better definition of “international comity” as “deference to foreign states that is not required by international law.” And the Restatement articulates many of those doctrines in terms that are neither amorphous nor fuzzy. (Disclosure: I served as a reporter for the Restatement.) But Westlaw tells me that courts in the United States have not yet discovered the Restatement’s definition.

Conclusion

One hundred and thirty years after its birth—and 87 years after its ostensible burial by Erie—Hilton v. Guyot lives on. For better or worse, it continues to frame the way international comity is viewed in U.S. law. And in the realm of foreign judgments, it continues to shape the rules of U.S. law.