Assignment Validity under Foreign Law Restricts Public Policy Exception in Brussels I (Recast)

Introduction

This commentary examines the Supreme Court of Ireland’s landmark decision in Scully v Coucal Ltd ([2025] IESC 20), where the Court constrained the “manifest public policy” exception under Article 45(1)(a) of Regulation (EU) No. 1215/2012 (“Brussels I (recast)”). The appeal concerned the Irish recognition and enforcement of a Polish judgment obtained by Coucal Ltd., a special purpose vehicle which had acquired individual Irish investors’ causes of action against Micheál Scully. The primary issue was whether the assignments—valid under Polish law—“savored of champerty” and thus could trigger refusal of recognition on public policy grounds in Ireland. The Court refused to look behind the foreign judgment, holding that where the lex causa permits assignments, the Brussels I (recast) public policy exception cannot be invoked merely because Irish law would void those same assignments.

Summary of the Judgment

In a judgment delivered by Chief Justice O’Donnell (with whom Dunne, Charleton, O’Malley and Hogan JJ. agreed), the Supreme Court allowed Coucal’s appeal from the Irish Court of Appeal. It held that:

Article 52 of Brussels I (recast) precludes any review of the foreign court’s reasoning or the substantive validity of its judgment.
The public policy exception in Article 45(1)(a) is narrow and demands a manifest breach of a rule of law or a right fundamental to the domestic legal order.
Assignments of bare causes of action valid under the law of the judgment-rendering State (the lex causa) do not give rise to manifest public policy objections in Ireland merely because Irish common law would have treated them as champertous.
The Polish judgment must therefore be recognized and enforced, subject to any further consideration on the separate “rule of law” issue reserved for later submissions.

Analysis

Precedents Cited

Peter Buchanan Ltd v McVey [1954] IR 89 – refusal to enforce foreign revenue judgments on public policy grounds.
Mayo-Perrott v Mayo-Perrott [1958] IR 336 – refusal to enforce a divorce-costs judgment, illustrating the exceptional nature of public policy in private international law.
SPV Osus Ltd v HSBC Institutional Trust Services (Ireland) Ltd [2018] IESC 44; [2019] 1 IR 1 – holding that assignments of bare rights to litigate are void for champerty unless the assignee has a genuine independent commercial interest.
Sporting Index Ltd v O’Shea [2016] 3 IR 417 – refusal to enforce a UK gambling debt judgment on grounds of Irish statutory public policy (Gaming and Lotteries Act 1956).
Key CJEU authorities interpreting “manifest public policy” narrowly, including Solo Kleinmotoren (C-414/92), Krombach (C-7/98) and Real Madrid Club de Fútbol (C-633/22).

Legal Reasoning

The Court’s reasoning unfolded along four lines:

Scope of Article 45(1)(a): The public policy exception was designed as a narrow, residual safeguard. Mutual trust among EU Member States demands that foreign judgments be recognized unless they manifestly violate a fundamental domestic principle.
Prohibition on reviewing foreign reasoning: Article 52 forbids looking behind the foreign judgment’s substance. Absent procedural unfairness of exceptional gravity, Irish courts must accept the foreign court’s findings.
Champerty and maintenance in Irish law vs. lex causa: Under Irish common law (as restated in SPV Osus), assignments of bare causes of action are champertous and void unless the assignee had an independent commercial interest. But Poland’s legal order, as the lex causa, imposes no such restriction. The Court held that it cannot override a valid assignment under foreign law merely because it would be void in Ireland.
Manifest public policy threshold not met: Even accepting arguendo that Coucal’s assignment contemplated onward transmission, enforcement of a valid Polish judgment would not “manifestly” breach any rule “essential” to Irish law. The public policy concerns in Irish common law relate to the administration of justice within Irish courts up to judgment, not to judgments lawfully obtained abroad under a different procedural regime.

Impact

This decision clarifies the interplay between:

Brussels I (recast)’s public policy exception (Article 45(1)(a));
The prohibition on reviewing foreign judgments (Article 52);
The distinction between domestic procedural norms (like champerty rules) and the lex causa governing foreign judgments.

Practically, it signals to litigants and practitioners that:

Assignments validly made under the law of the judgment-rendering State will generally survive recognition in Ireland even if they would be void for champerty here.
The Irish public policy exception is reserved for the rarest of cases—such as serious procedural unfairness or judgments fundamentally at odds with core constitutional rights.

Future cases will need to show a more acute, manifest conflict with an Irish “rule of law regarded as essential” before a foreign judgment can be refused recognition on public policy grounds.

Complex Concepts Simplified

Brussels I (recast): An EU Regulation (No. 1215/2012) ensuring judgments in civil and commercial matters circulate freely across Member States.
Lex causa: The law of the country where the original judgment was issued, which governs substantive validity (e.g., assignments).
Champerty and maintenance: Historic common‐law torts and crimes forbidding third-party funding or trading in another’s lawsuit without a genuine pre-existing interest.
Manifest public policy (ordre public): An exceptionally narrow ground to refuse a foreign judgment, requiring a clear breach of a principle fundamental to Irish justice.
Article 52 prohibition: Courts in the enforcing State must not re-examine the foreign court’s decision on substance—they only assess limited formal and public policy grounds for refusal.

Conclusion

Scully v Coucal Ltd delivers a pivotal ruling on the limits of the public policy exception under Brussels I (recast). The Supreme Court reaffirmed that valid assignments under the lex causa cannot be invalidated for public policy reasons in Ireland merely because they would contravene Irish common law anti-champerty rules. By strictly enforcing Article 52’s prohibition on substance review and circumscribing Article 45(1)(a) to its exceptional core, the Court has reinforced mutual trust in EU Member States’ legal orders. This judgment will guide practitioners in cross-border litigation funding and the enforcement of foreign judgments, highlighting that only the clearest, most fundamental clashes with Irish justice warrant non-recognition.