• Honorable Justice Mr. Hariprasad Phuyal
• Honorable Justice Mr. Nripadhwaj Niraula

Original Court Decision:

Facts of the Case

• Marriage was concluded between the defendant Narayan Sapkota and the plaintiff according to social customs on 2069/10/13 (B.S.)
• After marriage, the defendant went abroad to Australia
• On 2070/04/12 (B.S.), the plaintiff also went to Australia
• After approximately three years, the defendant completed his studies and forced the plaintiff for divorce, also committing domestic violence
• On 2073/1/12 (B.S.), the defendant set a date deemed to be a date of Separation in Australian Court
• On 2073/02/13 (B.S.), the plaintiff came to Nepal; upon arriving at the paternal house, the brother-in-law (Jethaju) refused to let her enter, stating she could no longer live there

Timeline of Key Events:

• 2069/10/3: Marriage between plaintiff (Primsa Dawadi) and defendant (Narayan Sapkota)
• 2070/4/28: Plaintiff went to Australia
• 2073/1/12: Date deemed to be the date of separation as filed by defendant in Australia
• 2073/2/13: Plaintiff returned to Nepal; brother-in-law denied entry to paternal home; plaintiff went to parents' home in Bharatpur, Chitwan.
• 2073/2/17: Plaintiff filed for property share from husband
• 2073/3/9: Plaintiff returned to Australia and filed a family violence complaint in The Magistrate's Court of Victoria
• 2073/07/09: Chitwan District Court ordered transfer of the entire case file to Nawalparasi District Court, citing permanent domicile and immovable property in Nawalparasi, authority under Country Code No. 29, and Section 7 of the Judicial Administration Act, 2073
• 2074/6/10: Defendant filed for divorce in Federal Circuit Court of Australia
• 2074/6/24: Notice of divorce case was given to plaintiff by the concerned court (providing sufficient ground for plaintiff to represent herself in foreign court)
• 2074/08/29: Nawalparasi District Court ordered plaintiff-defendants to appear at Nawalpur District Court, cutting registry costs and sending the case file to Nawalpur District Court
• 2074/10/2: Federal Circuit Court of Australia granted divorce, effective from 2074/11/4
• 2074/12/5: Decision from Nawalpur District Court in favor of Plaintiff, granting one half of property share from defendant's property
• 2075/4/6: Appeal filed in High Court, Pokhara
• 2075/10/13: High Court ordered mediation for one month pursuant to Rule 93(1) of the High Court Regulations, 2073
• 2076/05/17: High Court decision upheld the District Court's decision
• 2076/12/4: Supreme Court granted permission for judicial revision

Claim of Plaintiff

Arguments of Defendant

Procedural History

Supreme Court:
Granted permission for judicial revision on 2076/12/4

Legal Questions Raised in Supreme Court

A. Whether private international law principles apply to this case or not?
B. Whether this court should recognize the divorce judgment of the foreign court that dissolved the marital relationship between the plaintiff-defendant or not?
C. Whether the property share case filed in the original district court (under old Country Code Section 10 and on the basis of the current Muluki Civil Code, Section 213), which was filed before the divorce case initiated in Australian court, remains alive or not, where the Australian court granted divorce between the plaintiff and defendant when the case was ongoing in Nepal?
D. Whether the decision given by the High Court Pokhara is valid or not? Should the revisionary defendant's demand be granted or not?

Decision and Reasoning

A. Whether Private International Law Principles Apply to This Case

The Supreme Court first examined the question of whether private international law principles apply to the present case. In analyzing this issue, the Court considered the principles recognized by prevailing private international law and the practice adopted by this Court in resolving various cases over time. The Court observed that before the promulgation of the Muluki Civil Code, 2074, the principles inherent in private international law were already given recognition in Nepali jurisprudence. The Court specifically referred to the full bench decision dated 2020/12/25 in the case of Minadevi Rana v. Shanta Sambhor Rana, where the principle was firmly established that "when a case involves a foreign element, private international law comes into application." This principle, the Court noted, has been continuously followed and developed as settled legal doctrine in Nepal.

The Court further examined the statutory framework now in place, observing that the Muluki Civil Code, 2074 Section 692 provides that "any subject relating to private legal relations involving a foreigner, foreign object, or work done abroad" shall be governed by private international law provisions. This represents the primary statutory arrangement for private international law in Nepal. Applying this provision to the facts of the present case, the Court found that the property share case filed first in Nepal and the divorce case filed thereafter in Australia are both directly connected with the main questions to be decided in this matter. Additionally, the Court noted that whether to recognize the divorce decision from the Australian court is a main subject of the present case, which inherently involves a foreign element as per Muluki Civil Code, 2074 Section 692. Since a foreign element is undeniably present in this case, the Court concluded that it is neither legally appropriate nor would it lead to serious legal inconsistency to decide on the basis of Nepal's internal substantive law while ignoring private international law principles and doctrines. The Court held that private international law principles apply to this case.

B. Whether This Court Should Recognize the Foreign Court's Divorce Judgment

The Supreme Court then addressed the critical question of whether the divorce judgment issued by the Federal Circuit Court of Australia should be recognized by Nepali courts. In its comprehensive analysis, the Court first examined the general rules developed in the field of private international law for recognition and enforcement of foreign judgments. The Court noted that international documents including the Hague Conference on Private International Law and instruments issued by European Union bodies mention three general rules for recognition and enforcement of foreign judgments: first, the judgment must be capable of receiving recognition and being enforced in the country of the court that rendered it; second, the judgment must be final and not subject to appeal or review; and third, the judgment must have been issued by a competent court. The Court observed that the first two rules are self-evident, but the third rule regarding "competent court" raises the question of what constitutes a competent court, and for purposes of private international law, every court that has jurisdiction to resolve a dispute is understood to be a competent court.

The Court further examined the domestic legal framework, noting that these rules are recognized under Section 37(2) of the Mutual Legal Assistance Act, 2070. According to this provision, if upon studying the application along with the documents received pursuant to sub-section (1), the judgment made by a foreign court appears to satisfy certain requirements, the concerned Appellate Court must recognize the judgment made by the foreign court and send it to the concerned District Court for enforcement. These requirements include that such judgment has been made by the competent court with appropriate jurisdiction, such judgment is capable of being enforced in the concerned country, and such judgment has become final pursuant to the law of the concerned country and is not capable of being reviewed.

The Court then examined the grounds upon which a state may refuse to recognize and enforce foreign judgments. The Court noted that the authoritative body of private international law, the Hague Conference on Private International Law, and instruments issued by the European Union mention circumstances in which states may refuse recognition and enforcement. In the current interconnected world system, the Court observed that it would not be reasonable to ignore the private international law rules issued by the Hague Conference and European Union. Among those documents, the 2005 Hague Convention on Choice of Court Agreements (Article 9), the 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (Article 7), and the EU Regulation (Brussels I Recast 2012) Chapter III, Article 3, list circumstances in which a state may refuse to recognize and enforce a foreign judgment. These circumstances include: if the judgment was made contrary to principles of natural justice or procedural fairness; if the judgment was obtained fraudulently; if recognizing the judgment would be contrary to the state's public policy; if the parties obtained a judgment on the case by excluding the court which was concluded in contract or other means, against party autonomy; if a judgment on the same matter between the same parties has been made by the local forum court, or if a judgment between the same parties on the same matter was made by a third country's court before the foreign judgment and that judgment has already received recognition or enforcement in Nepal (question of conflicting judgments); and if the same case between the same parties was already pending in the domestic court before the foreign court issued its decision (principle of Lis Pendens: suit Pending).

The Court also examined Section 37(3) of the Mutual Legal Assistance Act, 2070, which provides specific conditions that prevent a foreign country's court judgment from receiving recognition in Nepal. These include situations where such judgment has been obtained by deception or fraud from the procedural perspective; where a case was filed in a court of Nepal prior to its being filed in a foreign court between the same parties, over the same fact, and for the same purpose and is sub judice in the court of Nepal; where judgment has already been made by the court of Nepal in the case mentioned in clause (b); where in the case mentioned in clause (b), judgment has been made by a court of another country and such judgment has already been recognized and enforced in or is in the process of being enforced in Nepal; where adequate opportunity has not been given to any party to fairly represent himself or herself in such judgment; where such judgment has been made in defiance of the regular procedures required for the trial of a case; and where enforcement of such judgment would be contrary to public order.

The Court further considered the Muluki Civil Code, 2074 Section 706, which provides that "when a divorce between Nepali citizens, or between a Nepali citizen and a foreigner, occurs abroad, such divorce, if it occurred according to the law of that country, shall be recognized as having occurred under Nepal law and its enforcement shall be possible."

In applying these principles to the Australian divorce judgment, the Court carefully examined whether any grounds for refusal existed. Regarding Section 37(3)(b) of the Mutual Legal Assistance Act, 2070, which would bar recognition if "the same facts, purpose, and parties have a case pending in a Nepali court before the foreign court," the Court noted that before the Australian divorce case was filed on 2074/06/10, the plaintiff had filed the property share case at the original district court on 2073/12/19. However, the Court found that while both the present share case and the Australian divorce case have the same parties and some similar facts, the purpose of the cases is different, with the share case seeking property division and the divorce case seeking dissolution of marriage. The Court also observed that the plaintiff has not been able to show any evidence from the conditions mentioned in Section 37(3) of the Mutual Legal Assistance Act, 2070. Furthermore, under Muluki Civil Code, 2074 Section 706, the Court found no appropriate basis for refusing recognition of the divorce decision made abroad. The Court concluded that considering the provisions in the Mutual Legal Assistance Act, 2070 and Muluki Civil Code, 2074 relating to private international law regarding recognition of divorce decisions made abroad cannot be disregarded by this Court.

The Court ultimately determined that the Federal Circuit Court of Australia's divorce decision dated 2074/10/12 satisfies the three conditions for recognition, as the decision is final in Australia and is of an enforceable nature there. Since the habitual residence of both the revisionary defendant and plaintiff has been Australia from the time the divorce case was filed until now, the Federal Circuit Court of Australia has jurisdiction to hear the divorce case under private international law principles. Therefore, the divorce judgment of the foreign court that dissolved the marital relationship between the plaintiff-defendant is recognized and enforceable.

C. Whether the Property Share Case Remains Alive

The Supreme Court then addressed the crucial question of whether the property share case filed in the original district court (under old Country Code Section 10 and on the basis of the current Muluki Civil Code, Section 213), which was filed before the divorce case initiated in Australian court, remains alive or not, where the Australian court granted divorce between the plaintiff and defendant when the case was ongoing in Nepal.

The Court began its analysis by examining the constitutional and legal framework in Nepal. The Court noted Nepal's Constitutional rights to property under Article 25, equality under Article 18, and provisions under Article 38 regarding women's rights. Specifically, the Court highlighted that Nepal's Constitution Article 38(6) states "spouses have equal rights in property and family matters." The Court observed that the constitutional fundamental rights provisions guarantee Nepali women equal rights to property as spouses before and after divorce. The Court further noted that Country Code, Logne Swasni No. 4(k) and the current Muluki Civil Code, 2074 Sections 99 and 213 all reflect the same purpose of ensuring that women receive a property share upon divorce.

In applying these provisions to the present case, the Court referred to its earlier decision in Pushkar Raj Pandey v. Sabina Pandey, which established that denying Nepali women their share rights and not providing fair hearing opportunity in a foreign court is contrary to Nepal's public policy. The Court acknowledged that Section 706 of the Muluki Civil Code provides for recognition of divorce decisions made abroad, so the foreign court's divorce decision cannot simply be outright rejected. However, the Court applied the principle of harmonization of conflicting laws, observing that two laws cannot be interpreted as contradictory if they can be harmonized, which is a general principle of legal interpretation. The Court found that the Muluki Civil Code, 2074 Sections 99 and 213, while aiming to ensure women receive a property share before divorce, cannot use Section 706 as a basis to make the wife's share right automatically inactive by recognizing the foreign court's divorce decision. The Court noted that the same applies here, since both parties agreed to the Australian Family Court using their law of divorce, which allows property claims within 12 months of divorce, and agreed that Spouse Maintenance Cost claims must be filed within 12 months of divorce under Australian law. Recognizing that Australian law allows post-divorce property claims within one year indicates there is no dispute about whether the plaintiff still has property share rights from Australia.

The Court then made significant observations on forum selection and the doctrine of forum non conveniens. The Court cautioned that courts should not be misused in the name of forum shopping to gain personal advantage. The Court observed that in countries where the husband has little or no financial obligation and the wife can receive maximum financial support, there is a tendency to file divorce cases, and sufficient rules need to be established about which country's court has appropriate jurisdiction for post-divorce property and financial obligation matters. The Court emphasized that courts should not become instruments that merely provide procedural advantage to one party. The Court noted that taking judicial notice of foreign court proceedings can prevent double judgments on the same matter, and in the same dispute where the other party has already filed a case in a foreign court, the case proceedings can even be stayed until the result. On the other hand, based on the doctrine of forum non conveniens, courts can decline to exercise jurisdiction if they are not the appropriate court or if a plaintiff files a case in an inconvenient court for their own benefit.

The Court provided extensive guidelines for future cases. The Court stated that specifically for couples who are habitually residing abroad and have filed a divorce case there, when there is property in Nepal belonging to the concerned shares, the parties should exercise caution and transparency regarding property division. Where parties regularly reside and where their movable and immovable property of their origin country is held should be clearly disclosed through property inventory. When participating in a divorce case in a foreign court, Nepali citizens should inform the court about any Nepal property through any legal or operational means in Nepal regarding the purpose of jurisdiction over Nepal property. Even if the property share case was filed in Nepal before the foreign divorce case was filed, the parties should disclose Nepal property information when responding in the foreign court. The Court noted that informing the foreign court about Nepal property jurisdiction in this way makes the question of what to do with that property easy to resolve, and this can prevent the situation of filing another case in Nepal for property division after the divorce case is decided. The Court further stated that for divorce and property division, only the country of residence should not be relevant; information about property in other countries where property exists should also be provided to the court where the divorce case is filed. Similarly, after divorce and property division, the practice of filing another case in Nepal for property, along with related practices, should be evaluated through the principle of finality of judgments in matters of private international law, Muluki Civil Code, 2074 private international law provisions, and Sections 37(2) and 37(3)(g) of the Mutual Legal Assistance Act, 2070.

Considering all the above grounds and reasons, the Court ultimately concluded that although the Federal Circuit Court of Australia's decision dated 2074/10/2 terminating the marital relationship between the plaintiff and revisionary defendant can receive recognition, since the plaintiff had already filed a property share case in the original district court on 2073/2/17, and the case was filed while retaining "wife" status under the old Country Code Section 10 and current Muluki Civil Code Section 213, there is no sufficient reason to dismiss the present share case. The Court reiterated that Nepal's Constitution guarantees every woman equal property rights as a spouse.

D. Whether the High Court's Decision is Valid and Whether the Revisionary Defendant's Demand Should Be Granted

The Supreme Court finally addressed whether the decision given by the High Court Pokhara is valid and whether the revisionary defendant's demand should be granted. The Court reasoned that since the plaintiff retained wife status when the share case was filed and was entitled to a share from the husband's property, the original Nawalpur District Court decision giving one share of two shares of property to the plaintiff and the High Court Pokhara decision upholding it is appropriate under law and justice and should not be changed. The Court found that the revisionary defendant's demand should not be granted as there is no sufficient ground to warrant any alteration of the lower courts' decisions. The Court affirmed that the plaintiff has received one share of two shares from the defendant as determined, and the original Nawalpur District Court decision upheld by the High Court Pokhara should be affirmed in its entirety.

Decision

The Supreme Court hereby orders and directs as follows:

• The divorce judgment of the Federal Circuit Court of Australia dated 2074/10/12 dissolving the marital relationship between the plaintiff (Primsa Dawadi) and the defendant (Narayan Sapkota) is recognized and enforceable under Nepali law.
• The property share case filed by the plaintiff on 2073/2/17 in the original district court remains alive and is not dismissed by virtue of the foreign divorce decree. 
• The decision of the Nawalpur District Court dated 2074/12/5, which awarded the plaintiff one half (1/2) of the movable and immovable property of the defendant, is affirmed. 
• The decision of the High Court, Pokhara dated 2076/05/19, which upheld the District Court's decision, is affirmed. 
• The plaintiff is entitled to receive one share of two shares from the defendant's property as determined by the lower courts.
• The revisionary defendant's demand is dismissed as there is no sufficient ground to grant the same.