Dominican Republic

Traditionally, when deciding on the recognition and enforcement of foreign decisions Dominican courts have relied on different legal systems that in most cases are not the applicable law. Before the enactment of the Law for Commercial Arbitration in 2008 and the Law for Private International Matters as recently as 2014, for the enforcement of foreign decisions in the Dominican Republic Judges would refer to the Private International Law Convention of 20 February 1928 (usually referred to as the Bustamante Code), the Convention on the Recognition and Enforcement of Foreign Arbitration Awards (the New York Convention) or the Civil Procedure Code to issue the corresponding administrative decision, since a formal procedure had not been established by law. Consequently, the case law for this process was diverse and unstable, enabling judges to deny or accept the recognition or enforcement of foreign decisions as per their own discretionary convictions, therefore affecting the judicial security and the growth of international transactions with Dominican counterparts.

However, with the enactment of the above-mentioned laws the procedure for the enforcement or recognition of foreign decisions has been formally introduced into the legal system as well as the obligations and limits of the courts regarding proceedings. Notwithstanding the existence of laws that govern the procedure for each type of decision, in practice, when encountered with a request for enforcement or recognition, Dominican courts do not differentiate between foreign arbitration awards and court judgments.

For example, in a recent controversial state-investor dispute the court’s decision on the enforcement of the arbitration award issued under the ICC rules the court stated the Bustamante Code, as the applicable law and proceeded without considering the provisions of the Law for Commercial Arbitration, which was already in force and clearly states the procedure for the enforcement of arbitration awards.

The Law for Commercial Arbitration and the Law for Private International Matters set forth similar recognition and enforcement procedures; however, there are certain differences regarding exceptions for recognition of arbitration awards, as the judge may only raise ex officio certain exceptions for the recognition of an award, contrary to the provisions of the Law for Private International Matters where all exceptions must be raised by the judge. Under Dominican law, all decisions regarding the judicial appointment of arbitrators or the recognition of foreign awards will be rendered on an ex parte or administrative capacity through court orders, which enables expedited proceedings. This inability of Dominican judges to differentiate between foreign awards and judgments exposes these decisions to be challenged by the parties for overreaching in their duties under
these procedures.

Legislation

In the Dominican Republic, the rules and procedures for the recognition and enforcement of foreign decisions are contained in the Law for Private International Matters for foreign court judgments and in the Law for Commercial Arbitration for foreign arbitration awards.

The Law for Commercial Arbitration provides that foreign arbitration awards shall be enforced in the Dominican Republic in accordance with the provisions of the law and the applicable international treaties, as well as the competent jurisdiction and relevant proceedings, which will be discussed in detail below.

Furthermore, the Law for Commercial Arbitration establishes specific exceptions to the recognition or enforcement of a foreign award; the judge may raise some while others can only raised by the parties. A judge shall ex officio deny the recognition or enforcement of a foreign award when one of the following is identified:

•   a violation of the right of defence of one of the parties due to non-compliance with due process;

•   that the subject matter is not susceptible to arbitration under Dominican law; or

•   that the recognition or enforcement of the arbitration award is contrary to public order.

Moreover, the party against whom the award is being enforced may, in addition to the exceptions established above, request the denegation of recognition or enforcement by raising and proving any of the following situations:

•   that one of the parties to the arbitration clause was affected by an incapacity at the moment of executing the agreement, or that the arbitration clause was invalid under the law of the arbitration;

•   that the arbitration award refers to a controversy not provided for in the arbitration clause, or contains decisions that exceed the terms of the arbitration clause;

•   that the appointment of the arbitrators or the arbitration procedure was not executed in accordance with the arbitration clause or in the absence of agreement of the parties on these issues, that they were executed in disregard of the law of the country where the arbitration took place; or

•   that the arbitration award is not yet binding on the parties or has been annulled or suspended by a competent authority of a country in which, or in accordance with the law of which the arbitration award has been issued.

However, in the case where the arbitration tribunal decided ultra petita, when possible, the dispositions of the arbitration award that cannot be enforceable may be separated, enabling the enforcement of the remaining parts of the award.

As for the recognition and enforcement of foreign court judgments, the Law for Private International Matters offers immediate recognition to judgments regarding legal capacity, existence of family relations and personality rights. Contentious judgments, however, shall be recognised and enforced after the exequatur procedure (administrative procedure referred to in detail in the following sections) has been completed.

The Law for Private International Matters establishes certain exceptions to the recognition of foreign court judgments that judges shall verify and apply. As for foreign arbitration awards, many of the exceptions are related to public order and due process.

Dominican courts shall not recognise or enforce decisions when:

•   the recognition is manifestly against public order;

•   when the judgment has been rendered without the presence of one of the parties and evidence that they were duly notified was not provided;

•   if the decision is incompatible with a previous judgment rendered in another state among the same parties, regarding the same subject matter, and said judgment complies with the conditions to be enforceable in the Dominican Republic;

•   if the subject matter of the judgment an excluded matter for the application of the Law for Private International Matters; and

•   if the judgment does not meet the conditions for enforceability under the laws of the country where it was rendered and the conditions required under Dominican law for its validity.

Proceedings

As the proceeding to recognise and enforce foreign arbitration awards is regulated under the Law for Commercial Arbitration and the proceeding for foreign court judgments under the Law for Private International Matters, they enjoy distinctive procedural dynamics, although they do have vast similarities that may mystify local attorneys and judges, as discussed previously.

Both proceedings (for foreign arbitration awards and for foreign court judgments) are conducted ex parte, which implies that the plaintiff is not obliged to advise the defendant (‘defendant’ being any other party involved in the foreign litigation) of the claim and no hearings are to be scheduled by the local court. Consequently, the plaintiff empowers the competent local court by means of a simple motion executed by his attorney and addressed to the court with the appropriate exhibits. The exhibits must serve to prove the grounds that the judge should inspect on the merits.

The fact that neither proceeding shall be discussed through oral, contradictory debates constitutes one, if not the biggest, victory of domestic legislation concerning recognition and enforcement of foreign decisions. This ensures attaining two relevant, pragmatic goals: that the claim would not represent a ‘trial de novo’, in the sense that the local judge would perform a superficial review and may not examine the merits nor in any way modify the foreign decision, and it should definitively speed up proceedings as a court order shall be rendered within a more reasonable time frame than an ordinary contentious claim.

The grounds for both cases are alike, as the two applicable laws (the Law for Commercial Arbitration and the Law for Private International Matters) provide that the Dominican court should limit its intervention to review basic due process principles, but most importantly the traditional cause of public order consistency between the foreign decision and the local legal system. In the particular case of arbitration awards, local courts must also review arbitrability and the parties’ legal capacity to arbitrate the dispute that led to the arbitration award.

Jurisdiction

One of the aspects that may produce confusion in the day-to-day practice is the one related to the competent jurisdiction in the Dominican Republic to review the claim to recognise and enforce the foreign decision, which is usually named an ‘exequatur claim’.

For many years, prior to the enactment of the Law for Private International Matters, there was uncertainty regarding court judgments on the issue of identifying the proper forum in the country to discuss a claim of this nature as the then-existing law failed to specify any provision in this topic. Henceforth, the plaintiff was forced to apply general law principles such as actor sequitur forum rei, which provides that the competent jurisdiction for a claim that is not exclusively related to an asset (‘personal actions’, as defined by the law) is the local court placed within the defendant’s domicile in the Dominican Republic. After the enactment of the Law for Private International Matters, the exclusive competent jurisdiction for an exequatur claim is the Civil and Commercial Chamber of the Court of First Instance of the National District, notwithstanding the defendant’s domicile in the country.

A similar scenario occurs in foreign arbitration awards, as the Law for Commercial Arbitration sets forth that the same court, that is, the Civil and Commercial Chamber of the Court of First Instance of the National District, is entitled to hear an exequatur claim. This means that there is a huge similarity between the methods of enforcing a foreign arbitration award and a foreign court judgment: the local court is exactly the same. However, the selection of the same court for both proceedings has created the possibility for court to apply any of the established procedures indistinctively, not differentiating between foreign arbitration awards and court judgments.

The purpose of the law when setting a specific local court in both matters seems logical, as it specialises the acting judges in these sort of matters and eliminates any discussion on the competent jurisdiction based on the parties’ domiciles, particularly when it is likely that neither party is domiciled in the Dominican Republic given the foreign nature of the proceedings.

Remedies

In this final section we will refer to the available means under Dominican law to challenge a local decision that allows enforcement of a foreign decision, whether an arbitration award or a court judgment.

For arbitration awards, the law provides that the interested party may question the decision from a Dominican court that accepts the exequatur claim through a direct claim before the correspondent Court of Appeals. The purpose of such claim is to reverse the decision of the local court and it should be founded on identical causes so that the judge might grant exequatur at the first phase (due process, public order, arbitrability, etc). The filing of this claim does not stay the enforcement of the foreign arbitration award. To prevent the enforcement of the foreign award the interested party may complement the direct claim with an ancillary claim or injunction before the Chief Justice of the Court of Appeals to provide temporary stay of the challenged decision.

It is important to point out that this direct claim is not a remedy of appeals, even though it should be filed, the same as ordinary appeals, within a 30-day deadline before an appellate court. The differences are notorious: ordinary appeals stay the challenged decisions and the court hears the appeal on a ‘trial de novo’ basis, while the direct claim at issue fails to stay the decision and is limited to the specific causes set forth by the law.

As for court judgments, the local decision on the exequatur claim may be subject to an ordinary remedy of appeals before the competent Court of Appeals. Contrary to the regimen of foreign arbitration awards, once an appeal is submitted the challenged decision is stayed until a definitive decision from the Court of Appeals is issued. In any case, if the original judge rejects the exequatur claim the plaintiff may reinsert the claim, as ex parte decisions lack res judicata.