Summary of Argument
Ashenden - Appeal, filed November 29, 1999

(8) Summary of Argument

This is an action under the Illinois Uniform Foreign Judgments Recognition Act ("UFMJRA"), which bars recognition of any foreign judgment if it is "rendered under procedures [in]compatible with the requirements of due process of law." 735 ILCS 5/12-621(a)(1). The Equitas "contract" involuntarily imposed on the Ashendens, if a contract at all, is one of adhesion. Included in its provisions were "pay now sue later" and "conclusive evidence" clauses that the English courts found as a matter of English law were binding on the Ashendens and precluded 1) their assertion of any defense of fraud in the inducement to invest in Lloyd’s syndicates, and 2) discovery of the basis for, or meaningful challenge to, the calculation of the amount claimed against them. Enforcement of these provisions through a contract of adhesion amounts to a classic deprivation of due process, barring recognition in Illinois of the judgments obtained thereby.

The "root requirement" of procedural due process is that absent some "extraordinary" situation, "an individual be given an opportunity for a hearing before he is deprived of any significant property interest." Fuentes v. Shevin, 407 U.S. 67, 82, 92 S. Ct. 1983, 1995, 32 L. Ed. 2d 556 (1972), quoting Boddie v. Connecticut, 401 U.S. 371, 378-79, 91 S. Ct. 780, 786, 28 L. Ed. 2d 113 (1971). The English judgments would clearly deprive the Ashendens of "significant property interests," approximately $727,000 (on top of $304,000 of their assets already taken in England and not subject to the Illinois UFMJRA strictures). The district court recognized that the English proceeding had not provided the Ashendens with the "meaningful pre-deprivation hearing" normally required by due process. App. 3 ("Memorandum Opinion and Order") at 15. It held nonetheless that there had been no due process deprivation, because 1) exigent circumstances justified postponing a meaningful hearing and 2) an adequate post-deprivation hearing is available to the Ashendens.

Neither of these crucial findings has any support in the summary judgment record on the basis of which the court acted. There were no exigent circumstances, because, contrary to the district court’s assumption, no interest of any third parties would be affected one way or another had the English courts provided the Ashendens with normal discovery and a pre-deprivation opportunity to present fraud in the inducement and other defenses. The only interests at stake were those of the private litigants in this case, Lloyd’s of London and the Ashendens.

Nor is there any meaningful post-deprivation hearing available to the Ashendens in which they can raise important defenses. The district court’s conclusion to the contrary seems to be based exclusively on the English Jaffray action, in which English investors in Lloyd’s are claiming fraud in the inducement. But neither Jaffray nor any other available English proceeding would give the Ashendens an opportunity to raise other defenses, including fraudulent or, most importantly, non-fraudulent error in the amount claimed and now reduced to English judgment.

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