BCB HOLDINGS LIMITED et al v. GOVERNMENT OF BELIZE
Filing
59
MEMORANDUM OPINION Regarding 58 ORDER GRANTING Petitioners' 53 Motion for an Order Pursuant to 28 U.S.C. § 1610(c) Authorizing Enforcement of Judgment, DENYING WITHOUT PREJUDICE Petitioners' 54 Motion for Anti-Suit Injunction, and DENYING Petitioners' 54 Motion for Temporary Restraining Order. Signed by Judge Colleen Kollar-Kotelly on 2/6/2017. (Attachments: # 1 Exhibit A, # 2 Exhibit B) (lcckk3)
BCB Holdings Limited v. Government of Belize, 650 Fed.Appx. 17 (2016)
650 Fed.Appx. 17
This case was not selected for
publication in West's Federal Reporter.
See Fed. Rule of Appellate Procedure 32.1
generally governing citation of judicial decisions
issued on or after Jan. 1, 2007. See also
U.S.Ct. of App. D.C.Cir. Rule 32.1 and Rule 36.
United States Court of Appeals,
District of Columbia Circuit.
BCB Holdings Limited and
Belize Bank Limited, Appellees
v.
Government of Belize, Appellant.
No. 15-7063
|
Consolidated with 15-7069
|
September Term, 2015
|
Filed On: May 13, 2016
Synopsis
Background: Belize-registered parent holding company
and its banking subsidiary petitioned to confirm
foreign arbitral award, pursuant to Federal Arbitration
Act (FAA) and Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (New York
Convention), to convert award plus costs and interests
to United States dollars, and to enter judgment in their
favor against Government of Belize or, alternatively,
filed complaint to recognize and enforce foreign money
judgment pursuant to District of Columbia ForeignMoney Judgments Recognition Act. Belize moved to
dismiss petition and complaint. The United States District
Court for the District of Columbia, Colleen KollarKotelly, J., 110 F.Supp.3d 233, granted petition and
denied motion. Belize appealed.
Holdings: The Court of Appeals held that:
[1] the doctrine of international comity was not a “rule of
procedure” of the United States, and so did not constitute
a basis for denying enforcement of the foreign arbitral
award under the New York Convention;
[2] Belize failed to show that enforcement of foreign
arbitral award would violate the most basic U.S. notions
of morality and justice; and
[3] equitable tolling of the statute of limitations for
bringing suit to enforce arbitral award was appropriate.
Affirmed.
*18 Appeals from the United States District Court for
the District of Columbia (No. 1:14-cv-01123)
Attorneys and Law Firms
Louis Benjamin Kimmelman, Esquire, Attorney, Dana
Chandler MacGrath, Counsel, Sidley Austin LLP, New
York, NY, Kristin Graham Koehler, Ryan Conway
Morris, Esquire, Sidley Austin LLP, Washington, DC, for
Petitioners–Appellees.
Juan C. Basombrio, Dorsey & Whitney LLP, Costa Mesa,
CA, Creighton Reid Magid, Esquire, Dorsey & Whitney
LLP, Washington, DC, for Respondent–Appellant.
Before: Rogers, Griffith, and Kavanaugh, Circuit Judges.
JUDGMENT
This appeal was considered on the record from the United
States District Court for the District of Columbia and on
the briefs and oral arguments of the parties. The Court has
afforded the issues full consideration and has determined
that they do not warrant a published opinion. See D.C.
Cir. R. 36(d). It is
ORDERED and ADJUDGED that the judgment of the
District Court is hereby AFFIRMED.
BCB Holdings Limited and Belize Bank Limited are
two Belizean banking companies. In 2005, those two
companies signed an agreement with the Belizean
Prime Minister regarding, among other things, their tax
treatment. In 2008, the Government of Belize repudiated
that agreement. In response, BCB Holdings and Belize
Bank invoked the agreement's arbitration clause. On
August 20, 2009, an arbitral tribunal in London ruled
against Belize and ordered the country to pay a substantial
amount (approximately $20.5 million in U.S. dollars), plus
© 2017 Thomson Reuters. No claim to original U.S. Government Works.
1
BCB Holdings Limited v. Government of Belize, 650 Fed.Appx. 17 (2016)
interest and costs. The two companies first tried to enforce
the award in Belize itself. But that effort failed because
Belize's highest court ruled that the award contravened
Belize's separation-of-powers system. So on July 1, 2014,
BCB Holdings and Belize Bank sought to enforce the
award in the U.S. District Court for the District of
Columbia. Belize moved to dismiss the suit on a variety
of grounds, including international comity, public policy,
forum non conveniens, and the statute of limitations.
The District Court found none of Belize's arguments
persuasive, and it enforced the arbitral award. See BCB
Holdings Ltd. v. Belize, 110 F.Supp.3d 233 (D.D.C. 2015).
[1] We affirm. Under the Federal Arbitration Act, U.S.
courts must enforce foreign arbitral awards unless they
find “one of the grounds for refusal or deferral of
recognition or enforcement of the award specified in”
the United Nations Convention on the Recognition and
Enforcement of Foreign Arbitral Awards, 21 U.S.T. 2517
(1958), also known as the New York Convention. 9 U.S.C
§ 207. In this case, Belize asks us to deny enforcement
on the basis of international comity. Belize argues that
the Convention instructs courts to *19 enforce arbitral
awards “in accordance with the rules of procedure of the
territory” where the enforcement action is brought. New
York Convention art. III. But Belize has failed to provide
support for its assertion that the doctrine of international
comity is a “rule of procedure” of the United States.
[2] Belize also claims that the District Court should
have refused to enforce the arbitral award because it
was the result of a corrupt bargain between the two
companies and the former Belizean Prime Minister. Under
the New York Convention, courts may decline to enforce
an arbitral award if “enforcement of the award would be
contrary to the public policy of that country.” New York
Convention art. V(2)(b). But courts should rely on the
public policy exception only “in clear-cut cases” where
“enforcement would violate the forum state's most basic
notions of morality and justice.” Termorio S.A. E.S.P.
v. Electranta S.P., 487 F.3d 928, 938 (D.C. Cir. 2007)
(citations omitted). In this case, Belize has not shown that
enforcement would violate the most basic U.S. notions of
morality and justice. The arbitral tribunal did not find any
corruption. And Belize's highest court refused to enforce
the award not because the underlying agreement was
tainted by corruption, but rather because the agreement
violated Belize's separation of powers. Belize has failed to
justify the use of the public policy exception in this case.
Belize also argues that the District Court should have
refused to enforce the arbitral award based on two other
public policies: the separation of powers and international
comity. But enforcement in this case would not violate any
“basic notion of morality and justice” rooted in either of
those two doctrines.
Belize contends that the District Court should have
dismissed the enforcement action on forum non
conveniens grounds. That argument is squarely foreclosed
by our precedent. In TMR Energy Ltd. v. State Property
Fund of Ukraine, 411 F.3d 296 (D.C. Cir. 2005), we held
that the doctrine of forum non conveniens does not apply
to actions in the United States to enforce arbitral awards
against foreign nations. See id. at 303–04.
[3] Finally, Belize claims that BCB Holdings and Belize
Bank were time-barred from bringing their enforcement
action. Generally, parties must bring suit to enforce an
arbitral award within “three years after [it] is made.”
9 U.S.C. § 207. Here, BCB Holdings and Belize Bank
took almost five years. But the District Court equitably
tolled the statute of limitations so that their claims were
not time-barred. BCB Holdings Ltd., 110 F.Supp.3d at
245. The District Court reasoned that BCB Holdings
and Belize Bank had pursued their rights to the arbitral
award diligently. Id. According to the District Court,
the two companies had failed to enforce the award only
because of an external obstacle—a 2010 Belize criminal
statute that, as relevant here, imposed imprisonment and
substantial fines on those who violated a Belize Supreme
Court injunction, including injunctions against pursuing
enforcement of arbitration awards against Belize. Cf.
Belize Social Development Ltd. v. Belize, 668 F.3d 724, 729
(D.C. Cir. 2012). That statute was ruled unconstitutional
in January 2014. But up until that point, the District
Court observed, the statute had a “chilling effect” on
enforcement efforts. BCB Holdings Ltd., 110 F.Supp.3d at
245. This Court has not resolved the appropriate standard
of appellate review for equitable tolling decisions. But
even under de novo review, we agree with the District
Court that equitable tolling was appropriate under all the
circumstances here. The companies persuasively explain
that they *20 and their lawyers were reasonably chilled
from enforcing the award in the United States because
they might thereby run afoul of the Belizean statute and
risk criminal penalties. So long as the statute was in
effect, therefore, it was reasonable for BCB Holdings
© 2017 Thomson Reuters. No claim to original U.S. Government Works.
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BCB Holdings Limited v. Government of Belize, 650 Fed.Appx. 17 (2016)
and Belize Bank to avoid any action—including starting
an enforcement suit in the United States. And once
the statute was ruled unconstitutional, it was reasonable
for BCB Holdings and Belize Bank to then file the
enforcement action in the District Court within six
months.
We have carefully considered all of Belize's arguments. We
affirm the judgment of the District Court.
End of Document
Pursuant to D.C. Circuit Rule 36, this disposition will not
be published. The Clerk is directed to withhold issuance
of the mandate herein until seven days after resolution of
any timely petition for rehearing or rehearing en banc. See
Fed. R. App. P. 41(b); D.C. Cir. R. 41.
All Citations
650 Fed.Appx. 17
© 2017 Thomson Reuters. No claim to original U.S. Government Works.
© 2017 Thomson Reuters. No claim to original U.S. Government Works.
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