Austria has also expressed her earnest desire to have a convention with France, with regard to the execution of foreign judgments. In the recent decisions of the Supreme Court of Vienna, the Judges have expressed their regret that no treaty exists between the two nations on this point, and have been compelled (as a French Court would have done in the case of an Austrian judgment) to refuse all authority to a French judgment. The projected Franco-Belgian treaty, if it had been made between France and Austria, would meet this difficulty, and the French Government is considering the Austrian proposals. Italy already has a treaty with France with regard to the reciprocal execution of judgments, made in 1760, and confirmed in 1860, which is well worth remodeling in accordance with the modern ideas of international law and the new Italian code, and in this case the provisions of the projected Franco-Belgian treaty with regard to jurisdiction might be adopted without conflicting with Italian legislation.

As regards the execution of foreign judgments, many European States adopt a system, which, although liberal, safeguards the higher interests of the State. In France, according to jurisprudence, which is derived from ancient and confused texts, every foreign judgment must be revised by the French Courts, that is to say, reviewed as regards its merits and its form in order to make it executory in France. The result of this jurisprudence, justifiable as it may be in the case of judgments delivered by the Courts of some particular countries, is that a new action has to be brought in France, and the same treatment is accorded to French judgments when they come before foreign Courts; and the power of giving an exequatur, which, if rightly understood, would give beneficial results, is made unavailable, owing to the want of agreement between the legislations of different countries. In order to escape these serious inconveniences, France has made treaties

on this point with Italy, Switzerland, Baden, and AlsaceLorraine; but these conventions, though sound in principle, require modification, and are of no authority between France and her other neighbours with whom she has extensive civil and commercial relations.

The chief obstacle to making these treaties is the difficulties of legal arrangement which are involved in codification and the framing of draft conventions. But still these difficulties can be overcome, and the framing of the present projected convention between France and Belgium is a proof that the problem is not insoluble, and that new international agreements are feasible, not only with regard to the execution of foreign judgments, but also with regard to the international jurisdiction of municipal courts. (Translated.)

CHARLES LACHAU,

Avocat à la cour d'appel de Paris.

The recent decision of the Court of Appeal in Pemberton v. Hughes is of importance as an illustration of the general rule in English law of recognizing a foreign judgment on a matter within the jurisdiction of the Court pronouncing it as conclusive, unless shown to have been obtained by fraud, or to be inconsistent with English ideas of natural justice. The question was what effect was to be given to a decree of divorce obtained in Florida, where, though the husband and wife were domiciled and resident in Florida, an error of procedure had taken place in the divorce proceedings, but it was not proved that the decree was void in Florida. The Master of the Rolls, however, in his judgment assumed that the decree would have been void in Florida, and after pointing out that an English Court never investigates the merits of a foreign judgment pronounced by a competent Court unless that judgment offends against English views of substantial justice, laid down as a principle that the jurisdiction which

alone is important in these matters is the competence of the foreign Court in an international sense only, and its competence in any other sense is not regarded as material by an English Court; and that, although it might seem paradoxical to say that a judgment might be of no effect in the country where it was pronounced, but might be good in another country, still the distinction between the jurisdiction of tribunals from an international point of view, and their jurisdiction from a merely municipal point of view, rests on good sense, and is recognized by modern writers on international law.

The point does not seem to have arisen before, but it seems to depend on the same principle as principle as that which is recognized by our Courts in determining the effect of a foreign judgment, viz. that an English Court shall not constitute itself a Court of Appeal from the foreign Court, and consequently what is matter for appeal in the foreign country cannot be gone into here; and so long as no appeal is made the foreign judgment must be regarded as good here. A distinction has been drawn between foreign judgments in rem and those in personam; and a foreign judgment in rem has been held here to have a higher value, on the ground that it is good against all the world, while one in personam is only good against the parties to it; but this is really only a question of extent, and not of intrinsic value (Piggot, Foreign Judgments, 249).

Where a foreign judgment is sought to be recognized here, it is regarded as a res judicata. When, however, it is sought to enforce a foreign judgment here, the judgment is not treated as res judicata, but only as primâ facie evidence of the cause of action: a fresh action must be brought, but the only defences which can be set up to it are fraud, want of jurisdiction, violation of international law or natural justice, and incompatibility with

English law. In Continental countries foreign judgments can be enforced by an exequatur, or judgment making them executory, which, however, is only granted in some countries after révision du fond, i.e. investigating the merits of the case, while in others it is granted after révision du forme, or merely seeing if the judgment is correct in form, and not incompatible with the lex fori, and in others this latter privilege is only granted to judgments of the Courts of a state which grants them reciprocity.

Income Tax.

The recent decisions in Apthorpe v. St. Louis Brewery Co. and Apthorpe v. Peter Schoenhofen Brewery Co., which are to the effect that a registered English company with a registered office in London, which trades in a foreign country under the name or through the agency of a foreign company, in which it holds all the shares but a nominal number reserved in order to comply with a law of the foreign country prohibiting alien corporations or persons from holding real property. there, and over the management and staff of which it exercises absolute direction and control from its London office, is liable to pay income-tax on the whole of the profits of that trade (Income Tax Act of 1853, s. 2, sched. D), and not merely on such of those profits as are remitted to England (Income Tax Act of 1842, s. 100, sched. D, case (5)), follows the previous decisions of the House of Lords in San Paulo Brazilian Railway Co. v. Carter [1896] (App. Cas. 31), and treats as of no authority the decision in Bartholomay Brewery Co. of Rochester v. Wyatt [1893] (2 Q.B. 499), in which the 1842 Act was held applicable. The test in these cases is whether the trade in respect of which income-tax is claimed is carried on wholly outside the United Kingdom or not; in the former case, only the profits remitted to England are liable to the tax (Colquhoun v. Brooks [1889] (14 App. Cas. 493)); in the

latter whether the trade is carried on wholly in England or partly in England, or partly abroad, all the profits are taxable (London Bank of Mexico & S. America v. Apthorpe [1891] (1 Q.B. 383 and 2 ibid. 378; San Paulo case above). This is a question of fact, and depends on the circumstances of each case; but there are judicial definitions which go a long way to determine it. The principle suggested by Wright, J., in the Bartholomay case, that "a business is wholly carried on abroad if all the operations which earn the profit are done abroad, notwithstanding that the owner resides there, exercises control over those operations, and ascertains and apportions the profits" is, it seems, overruled by Lord Halsbury's judgment in the San Paulo case, that "a company clearly carries on trade in London if it issues its orders from there and so governs and directs the whole commercial adventure that is under its superintendence;" and the contention of the Crown in that case (which was upheld) was that "the brain was here though the limbs were abroad; the policy and control, the rates to be charged, and the contracts to be made, and the appointment and dismissal of servants were determined here, and the accounts were kept, and the officers were resident here."

It was urged in Colquhoun v. Brooks that to tax a foreigner residing here for a short time only in respect of the whole of his business earnings in his own country or elsewhere would be opposed to international comity; but Lord Herschell denied that this would involve any violation of international law, and pointed out that the Income Tax Acts imposed a territorial limit, for either that from which the taxable income is derived must be situate in the United Kingdom, or the person whose income is to be taxed must be resident there for six months; and Lord Macnaghten took the same view.