Summary of a Recent
Judicial
Development in
Alternative Dispute Resolution
Domestication of a Foreign Arbitration Award
Walt McCarterNational AgLaw Center Research Associate
Summary of Decision
In Armtech Insurance Services, Inc. v. Hamilton, No. 07-08-0325-CV, 2009 WL 498048 (Tex. App. Feb. 27, 2009), the Texas Court of Appeals held that a judgment award entered by a Florida district court was final, appealable, and immediately enforceable, and therefore the plaintiffs were entitled to domesticate the judgment in a Texas district court.
Background
Plaintiffs obtained an arbitration award against their crop insurer, Armtech Insurance, which was confirmed by a Florida district court. Id. at *1. Plaintiffs then relocated to Texas and sought to domesticate the judgment. Id. The Texas district court overruled Armtech's object to the domestication, and Armtech appealed. Id.
Arguments
Armtech argued that the Florida federal court judgment was not entitled to full faith and credit because it was subject to modification. Id. at *1. It also argued that federal regulation 7 C.F.R. § 400.459 (in force at the time of the decision) prevented payment of the judgment because the plaintiffs owed Armtech an outstanding debt, and that the judgment had effectively been paid already. Id. at *4.
Analysis and Holdings
The court found that the Florida judgment was "final, appealable and immediately enforceable," and therefore subject to domestication under the Uniform Enforcement of Foreign Judgments Act (UEFJA). Id. at *3. In regard to Armtech's remaining challenges, the court found insufficient evidence to conclude that the plaintiffs owed Armtech a debt, and rejected Armtech's arguments relating to the merits of the original case because although "a judgment debtor resisting recognition of a foreign judgment properly filed under the UEFJA may collaterally attack the judgment by establishing one of the recognized exceptions to the mandates of the Full Faith and Credit Clause," it "may not set up a defense that goes to the merits of the original controversy." Id. at *4.
The case was decided on February 27, 2009.