Relevant rules
Pursuant to Art. 2818, para. 1, of the Italian Civil Code, any judgement involving to “pay a sum or to fulfil another obligation or to pay compensation for damages to be identified later on” is a title for the registration of a judicial mortgage.
Art. 2820 clarifies that a mortgage can also be registered “on the basis of the judgements issued by foreign judicial authorities”, but only after it has been “declared the effectiveness by the Italian judicial authority”. The rule is without prejudice to the hypothesis that “international conventions provide otherwise”.
The problem
In practice, two opposing interpretation of Art. 2820 of the Italian Civil Code have been advanced.
According to a first interpretation, the rule shall be considered devoid of any practical relevance. The effectiveness in Italy of foreign judgements issuing to pay no longer depends on a judicial ruling. The principle of automatic recognition of foreign judgments is indeed of general application: it is provided for by various international conventions and legislative measures of the European Union, and operates – pursuant to Art. 64 of the Law No 218 of 31 May 1995, and under the conditions set out therein – also with respect to judgments that do not fall within the scope of these conventions and European Union measures. This being the case, the title registers of real estate records faced with an application to register a mortgage on the basis of a foreign judgement shall proceed without requiring, on the basis of Art. 2820 of the Italian Civil Code, no further requirements.
According to the opposite interpretation, the registration of the mortgage would in any case require a judicial ruling of effectiveness of the foreign judgement at stake. It is true that the principle of automatic recognition now applies to all foreign judgements; but, by applying for the mortgage registration, the creditor intends to achieve an effect under the judgement that is at least similar to its enforcement (M. Frigo, Diritti reali, in Diritto Internazionale privato, edited by R. Baratta, Milan, 2010, p. 122 s.). This implies the need to be satisfied, before proceeding with the registration, the conditions the enforcement of the judgement at stake depends upon (not generically the recognition, but rather) the enforceability of the judgement at stake. Therefore, it will be possible to register without a prior judicial ruling of effectiveness of the judgement only when the judgement is able to explain its enforceable effects in Italy without the need for exequatur, for instance because it is a ruling certified as a European enforcement order under Regulation (EC) No 805/2004 or because, falling within the scope of application of Regulation (EU) No 1215/2012, the ruling is enforceable in Italy – pursuant to Art. 39 of the latter Regulation – for the only fact of being so in the Member State of origin.
Legal analysis
In order to solve the problem, it is important to remember that judgments, including foreign ones, are able to produce, in principle, two distinct categories of effects.
There are, first of all, the so-called primary effects. These are the effects included in the ruling, that is, the effects achieved via the application claimed for at the origin of the judgement: for instance, the assessment of the credit claimed by Tizio against Caio and the right of Tizio to file an additional proceeding for the enforcement of Caio’s obligation to pay him 100.
In addition to the effects described above, the judgments can produce the so-called secondary effects. These are the effects that a judgement can produce – if a rule so provides for – due to the fact that it has been issued: additional effects with respect to the primary ones, which do not arise out of the ruling as an act among will and authority, but from the fact itself, that is the issuing of the judgement (if necessary, in the presence of other conditions, under the law that provides for these effects).
The attitude of the judgement to serve as a title for the registration of a mortgage falls into this second category of effects. This effect does not arise because the plaintiff claimed for it, or because the court ordered it to arise. It arises because there is a rule that links its arising to the issuance of judgements such as the one being discussed.
Well, rules governing the effectiveness of foreign judgement deal with the judgements primary effects. That is, they provide for under what conditions the judgements issued in one State (the State of origin) are enabled to produce in another State (the requesting State) the effects that derive from them as rulings, that is, as procedural acts. It is to this end, for instance, that Art. 64 of the Law No 218/1995 indicates the requirements for the recognition of foreign judgments (the so-called international jurisdiction of the court of the State of origin, non-contrariety to public policy, etc.), without requiring as assessment before in court; and it is always for this purpose that Art. 67 of the same law, on the other hand, makes the enforcement of foreign judgments under to the judicial assessment of those requirements.
The discipline of secondary effects shall be looked for elsewhere, precisely in the substantive rules in charge of regulating such effects. If there is an issue of the mortgage on a real estate located in Italy, the relevant rules shall be identified in the substantive Italian rules relating to the mortgage: Art. 51 of the law No 218/1995 indeed provides that the rights to hold property on movable and immovable assets, including then the rights to hold property, “are governed by the law of the State in which the assets are located”. Therefore, it is up to them to determine if, and under what conditions, the (secondary) effect of serving as a title to register a mortgage can be attributed to a foreign judgement. The relevant rule is Art. 2820 of the Italian Civil Code: even foreign judgments, if homologous in the matter (i.e. primary effects) to the Italian ones indicated in Art. 2818, are allowed to serve as a basis for the register of a mortgage.
Having assessed the applicability of Art. 2820 of the Italian Civil Code, the analysis shall be shifted to its interpretation. Indeed, it is necessary to understand under what conditions, precisely, the law allows the occurrence of the effect at stake. Textually, as mentioned, it shall be a foreign judgement whose effectiveness has been “declared by the Italian judicial authority”.
The rule, elaborated at a time when the effectiveness of foreign judgments was systematically subordinated to a judicial declaration of effectiveness (provided that they did not operate in the opposite sense of international conventions, not by chance expressly without prejudice to Art.2820 itself), it shall now be interpreted having regard to its purpose and in the light of the changed legal framework it operates in.
What the law requires is that the foreign judgement shall be effective in Italy. The reason is easily understood: if this condition were to be lacking, the registration of the mortgage would be, from a substantial point of view, without justification. This means that Art. 2820 of the Italian Civil Code makes the particular secondary effect under discussion subject to the fact that the decision is allowed to produce its primary effects in Italy.
But what primary effects, precisely, are we referring to? The general ones that are expressed in the concept of “recognition”, or the specific ones to which the enforceability concept refers to, that is, those that in the language of Art. 67 of the Law No 218/1995 involve the enforcement of the judgement? It would be in vain to seek the reply in the textual content of Art. 2820 of the Italian Civil Code: at the time it was drafted, the framework of the effectiveness of foreign judgments did not distinguish, indeed, among recognition and enforceability, since it subordinated the rise of all primary effects to the judicial assessment of the effectiveness requirements provided for by law.
In today’s legal framework, however, the distinction exists, and it is important to take it into account. Therefore, Art. 2820 shall be interpreted in the sense that recognition is enough (which always occurs automatically, provided the requirements are met), or it is also enforceable (which instead requires, except for specific exceptions, a judicial passage)? The preferable reply is the first: the primary effects that the foreign ruling shall be able to produce for the secondary effect provided for under Art(s). 2818 ss. to arise are the effects summarized in the recognition notion.
The opposite interpretation would not reconcile with other contextual data, equally useful to clarify the interpretation of Art. 2820.
In the first place, the registration of a mortgage is not, in itself, an enforceable act, nor it is treated as such by the legal order: the mortgage provides for a guarantee to the credit, but does not in itself contribute to its enforcement. Therefore, it is not clear why, for the onset of effects that are not enforceable, the fulfilment of requirements that the legal order instead requires precisely for enforcement proceeding shall be deemed as necessary.
Secondly, it is a settled case law that according to which the registration of a judicial mortgage under Art. 2818 of the Italian Civil Code does not require the related ruling to be enforceable (see, in this sense, among others, Italian Court of Cassation of 26 January 1996 No 584). If enforceability is not, in general, a condition for an Italian judgement to be a mortgage, it is not clear why the enforceability of foreign judgments should be required for the same purposes: once recognized, the latter produce indeed in the Italian legal order primary effects which are completely homologous to those deriving from the Italian rulings.
Finally, the interpretation defended here is consistent with that peacefully and constantly followed, in the wake of a Circular from the Italian Ministry of Justice (“Law of 31 May of 1995 No 218 reforming the Italian system of private international law – Offices of the civil status “, of 7 January 1997), for cases in which foreign judgments on status shall be transcribed, registered or recorded in public registers in Italy: the civil registrar required to carry out these formalities shall implement it without expecting that the existence of the requirements for the effectiveness of the aforementioned judgements has been assessed pursuant to Art. 67 of the Law No 218/1995.
This principle appears to be easily extensible, with the appropriate adaptations, to the formalities the registers of real estate records are in charge of in relation to mortgages.
Conclusion
The foregoing reasonings allow to conclude, with the comfort of the majority legal scholars (see, for all, E. D’Alessandro, Il riconoscimento delle sentenze straniere, Torino, 2007, p. 112), that the registration of a judicial mortgage on the basis of a foreign judgement only presupposes, for the purposes of Art. 2820 of the Italian Civil Code, that the judgement at stake is recognizable in Italy. On the other hand, it is not necessary (and shall not be required) that the conditions for the recognition of this judgement have been assessed before court.
For the purposes of registration, the verification of the conditions referred to in Art(s). 2836 and 2837 of the Italian Civil Code remains unaffected, i.e. the presentation of the copy of the title (in certified copy) and the legalisation of the same (if not operating, for the latter requirement, a dispensation, or the legalisation is replaced by the so-called apostille). Pietro Franzina
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