Carl Zeiss Stiftung v Rayner and Keeler Ltd (No 2): HL 1966

An agency had to be proved in a search to identify an entity which the law recognised (a) existed and (b) was legally responsible for the acts in issue in the proceedings. The House was asked whether the fact that an issue had already been determined in proceedings in West Germany meant that the same issue could not be re-litigated in English proceedings; whether the foreign judgment could give rise to issue estoppel.
Held: It could. The House looked at the principles in issue estoppel as between a decision of a foreign court, and a similar issue being litigated in England. It could. In the course of this discussion, the House had to consider whether the conditions for issue estoppel were fulfilled. One of those conditions was that the judgment of the foreign court had been final and binding. The House unanimously treated the issue as one governed by the foreign law even though English law applied to the conditions for estoppel.
Lord Wilberforce said: ‘As a matter of principle (and we are really thrown back upon principle), whether the recognition of judgments is based upon a recognition of vested rights, or upon considerations of public interest in limiting relitigation, there seems to be no acceptable reason why the recognition of foreign judgments should not extend to the recognition of issue decisions. From the nature of things (and here it is right to recall Lord Brougham’s warning) this, in the case of foreign judgments, may involve difficulties and necessitate caution. The right to ascertain the precise issue decided, by examination of the court’s judgment, of the pleadings and possibly of the evidence, may well, in the case of courts whose procedure, decision-making technique, and substantive law is not the same as our own, make it difficult or even impossible to establish the identity of the issue there decided with that attempted here to be raised, or the necessity for the foreign decision. And I think that it would be right for a court in this country, when faced with a claim of issue estoppel arising out of foreign proceedings, to receive the claim with caution in circumstances where the party against whom the estoppel is raised might not have had occasion to raise the particular issue. The fact that the court can (as I have stated) examine the pleadings, evidence and other material, seems fully consistent with its right to take a broad view of the result of the foreign decision. But with these reservations, where after careful examination there appears to have been a full contestation and a clear decision on an issue, it would in my opinion be unfortunate to exclude estoppel by issue decision from the sphere of recognition.’ and
Lord Reid: ‘I can see no reason in principle why we should deny the possibility of issue estoppel based on a foreign judgment, but there appear to me to be at least three reasons for being cautious in any particular case. In the first place, we are not familiar with modes of procedure in many foreign countries, and it may not be easy to be sure that a particular issue has been decided or that its decision was a basis of the foreign judgment and not merely collateral or obiter. Secondly, I have already alluded to the practical difficulties of a defendant in deciding whether, even in this country, he should incur the trouble and expense of deploying his case because it was impracticable for him to do so in an earlier case of a trivial character abroad, with the result that the decision in the case went against him.’ and ‘ . . it seems to me to verge on absurdity that we should regard as conclusive something in a German judgment which the German courts themselves would not regard as conclusive. It is quite true that estoppel is a matter for the lex fori but the lex fori ought to be developed in a manner consistent with good sense.’
Lord Upjohn: ‘All estoppels are not odious but must be applied so as to work justice and not injustice and I think the principle of issue estoppel must be applied to the circumstances of the subsequent case with this overriding consideration in mind.’
Lord Guest said: ‘Another aspect of finality relates to the requirement that the decision relied upon as estoppel must itself be res judicata in the country in which it is made. . . It would, indeed, be illogical if the decision were to be res judicata in England, if it were not also res judicata in the foreign jurisdiction. I am not satisfied that the respondents have discharged the burden of proof upon them of establishing that the West German judgment is res judicata in West Germany.’ and ‘The requirements of issue estoppel still remain (1) that the same question has been decided, (2) that the judicial decision which is said to create the estoppel was final, and (3) that the parties to the judicial decision, or their privies, were the same persons as the parties to the proceedings in which the estoppel is raised, or their privies.’


Lord Wilberforce, Lord Reid, Lord Upjohn


[1967] 1 AC 853, [1966] 2 All ER 536, [1967] RPC 497, [1966] 3 WLR 125


England and Wales


Appeal fromCarl Zeiss Siftung v Rayner and Keeler Ltd (No 2) CA 1965
The Court having held that the plaintiff had not been competent to bring the action, regarded itself as having jurisdiction to make an award of costs against the plaintiff’s solicitors. . .
CitedNouvion v Freeman HL 1889
A judgment of a court of competent jurisdiction may be final and binding, even though a right of appeal to a superior court remains open.
Lord Herschell stated on the question of finality or conclusiveness of a foreign judgment: ‘in order to . .

Cited by:

CitedGood Challenger Navegante S A v Metalexportimport SA CA 24-Nov-2003
The claimant sought to enforce an arbitration award made in 1983. Time might otherwise have expired, but the claimants relied on a fax which they said was an acknowledgement of the debt, and also upon a finding in a Romanian court which created an . .
CitedThe Sennar (No 2) HL 1985
The Henderson v Henderson principle should only be applied where it is clear (i) that the decision or determination relied on was made by a foreign court of competent jurisdiction and (ii) the decision upon the issue later sought to be raised is a . .
CitedWiltshire v Powell and others CA 7-May-2004
The claimant sought a declaration as to the ownership of an aircraft. Saying he had bought it in good faith from E H and S, who in turn similarly claimed to have bought it from Ebbs. The defendant had obtained a judgment that he was owner as against . .
CitedGur Corporation v Trust Bank of Africa 1987
Governmental acts of an unrecognised state cannot be recognised by an English court but ‘Common sense and justice may combine to require the qualification of these principles in certain respects.’ Discussing the Carl Zeiss case: ‘Carl Zeiss was . .
CitedNorth Cyprus Tourism Centre Ltd and Another, Regina (on the Application Of) v Transport for London Admn 28-Jul-2005
The defendants had prevented the claimants from advertising their services in North Cyprus on their buses, and justified this saying that the Crown did not recognise the Turkish Republic of North Cyprus since it was the result of an unlawful . .
CitedBarrett v Universal-Island Records Ltd and others ChD 15-May-2006
The claimant was entitled to share in the copyright royalties of Bob Marley and the Wailers, and claimed payment from the defendants. The defendants said that the matters had already been settled and that the claim was an abuse of process, and also . .
CitedDallah Estates and Tourism Holding Company v Ministry of Religious Affairs, Government Of Pakistan CA 20-Jul-2009
The claimant sought to enforce an international arbitration award against the defendant in respect of the provision of accommodation for Hajj pilgrims. A without notice order had been made to allow its enforcement, but that had been set aside.
CitedCalzaghe v Warren QBD 20-Jan-2010
The claimant boxer had secured judgement for fight fees from a company operated by the respondent manager and promoter. After the judgment the defendant had put the company into administration. The claimant now sought payment from the defendant . .
CitedNML Capital Ltd v Argentina SC 6-Jul-2011
The respondent had issued bonds but in 2001 had declared a moratorium on paying them. The appellant hedge fund later bought the bonds, heavily discounted. Judgment was obtained in New York, which the appellants now sought to enforce against assets . .
CitedJoint Stock Company (Aeroflot-Russian Airlines) v Berezovsky and Another CA 16-Jan-2014
The appellant had judgments obtained in Russia against the respondent. It now appealed against a refusal of enforcement of those judgments based upon the ground that there was a complete defence to the recognition and enforcement of the judgments . .
Lists of cited by and citing cases may be incomplete.


Updated: 29 April 2022; Ref: scu.188229