Sovereign Defaults Before Domestic Courts

Abstract

The monograph examines sovereign debt litigation before the English and New York courts. English and New York courts are the two main jurisdictions customarily chosen to resolve sovereign debt disputes. The book sets out parties’ litigation choices at various stages of proceedings and provides the legal background against which parties to a sovereign bond may wish to negotiate. The defining characteristic of the monograph is that it examines sovereign debt litigation through the prism of private law. The monograph clearly grounds its analysis in the law as it exists, rather than purely policy-oriented reasoning (albeit it keeps a critical eye on the reasoning of the courts). The monograph concentrates on diverse litigation tactics and arbitrage strategies available to bondholders and sovereign debtors that appear before the English courts. In most cases, private creditors may obtain summary judgments with relative ease. That said, often serious issues arise at the stages of assumption of jurisdiction, determination of the governing law of sovereign bonds or substantive resolution of the claims in English proceedings. Similarly, the enforcement of sovereign bonds against the assets of the sovereign often presents serious obstacles, most significantly the doctrine of State immunity. The book offers an exhaustive account of litigation tactics available to bondholders and sovereign debtors alike. The book is unique in the breadth of its coverage. It examines issues of jurisdiction and choice of law at the preliminary stages of litigation, substantive challenges of various sorts to sovereign debt restructurings and to the repayment of bonds on merits, and enforcement of final judgments against the State and its assets in the post-judgment phase.