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March 2018

Non-nationals use of US courts among issues explored by international law panel

The question of non-nationals using U.S. courts to file cases is interesting but one that ought not exist, says Frank J. Bailey, a federal bankruptcy judge for the U.S. Bankruptcy Court, District of Massachusetts. 

Bailey was one of three judges on a panel titled, “View From The Bench: The State of International Law,” sponsored by the ABA Section of International Law and held during the Midyear Meeting in Vancouver. He was joined on the panel by Judge Richard Franklin Boulware II of the U.S. District Court for the District of Nevada and Justice Harvey M. Groberman of the British Columbia Court of Appeals in Vancouver. Steven M. Richman, an attorney with Clark Hill PLC and chair of the Section of International Law, moderated the panel.

Panelists discussed the status of international law in judicial decision-making, including cross-border enforcement of judgments, international precedent and the continuing relevance of, and attacks on, the place of international law in American and Canadian courtrooms. Topics covered during the 90-minute program included Sharia or foreign law, data privacy and how foreign law applies, use of courts by non-nationals and cultural issues in adjudicating cases. 

Richman asked the judges for their thoughts on the use of U.S. courts by non-nationals.

Boulware, who was nominated to the bench by President Barack Obama in 2014, said the Supreme Court has been very explicit about jurisdiction and the reach of federal courts and that “there has been a significant restriction by the Supreme Court as to federal court jurisdiction in those matters.”

Bailey, who joined the court in 2009, said it ought to be limited to domiciliary. “It’s a question of dual citizenship,” he said. “If you live and work primarily in the United States, then you ought to have access to the courts.”

He then talked about a case he presided over. He said Massachusetts bankruptcy judges began seeing cases being filed by people from Ireland, which soon came to be known as “bankruptcy tourism.” Because of the Chapter 7 bankruptcy laws in the U.S., he said people who may have had some connection to Boston but were not citizens were filing cases to discharge their debt.

“In Ireland they don’t have that right,” Bailey said. “It’s a 12-year process and you still have to pay your creditors something. So this bankruptcy tourism thing started to take hold with people coming over and filing in our courts. So, I wrote a decision dismissing a case where a person was doing that.

“I don’t believe that our courts ought to be available in cases like this. We have no connection with the debt and no connection with the dispute.”      

Groberman said use of Canadian courts by non-citizens is “pretty unusual.”

“The Supreme Court in Canada requires a real and substantial connection between tort and the jurisdiction so we don’t have very many claims that have a very limited connection to the province where it’s brought,” he said. “In British Columbia, we have a statute called the Court Jurisdiction and Proceedings Transfer Act that creates rules as to when British Columbia has territorial jurisdiction.”

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