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Can a claim, debt, or other cause of action be assigned to a third party in Belize?

February 12th, 2021

The answer to this question depends upon a variety of factors, all of which are set out in the case of Delia Andrews Hyde v. RF&G Insurance Company Limited, Civil Appeal No 1 of 2016. As is usual in cases involving insurance law, the short answer is, “It depends.”

A slightly longer answer is that, yes, a cause of action may be assigned to a third party if several strict requirements are met. In case you don’t wish to read through the entire article, those requirements are as follows:

  1. The claim, debt, or other cause of action must be one that is already in existence. Except as anticipated under the doctrine of subrogation in insurance contracts, one cannot preemptively assign a claim to a third party in the anticipation that one will arise.
  1. Notice of the assignment must be expressly provided in writing to the debtor in compliance with The Law of Property Act.

If the case law is any indication, it appears that courts will be extremely hesitant to find that these conditions are met unless the assignee and assignor meet every technical and formal requirement under these conditions

Delia Andrews Hyde v. RF&G Insurance Company Limited

Before we embark upon an explanation of the conditions that must be met for a valid assignment to exist, a discussion of the leading case of Delia Andrews Hyde v. RF&G Insurance Company Limited, Civil Appeal No 1 of 2016 (Hyde) is warranted.

That case was an appeal of a decision of Griffith J. on November 27, 2015 that found in favor of RF&G. The facts, briefly, are as follows:

Delia Hyde was involved in a vehicle accident on November 29, 2013. She collided with a truck driven by Roselia Vallecillo, causing significant damage to it. Vallecillo was insured by RF&G, who paid her over $40,000 to settle the contract of insurance. Hyde was insured by Home Protector Insurance Co., but only for $20,000. Home Protector Insurance Co. paid RF&G the full $20,000 allowed by statute in Belize as Ms. Hyde was adjudged to be negligent and at fault for the collision.

Thereafter, RF&G sued Hyde for an additional $17,980 to cover the remainder of its settlement of the insurance contract with Vallecillo.

The trial judge found that Ms. Hyde was liable for the accident. He ordered Ms. Hyde to pay RF&G $16,805 plus costs and interest.

Ms. Hyde appealed, arguing, among other things, that RF&G had no standing to sue her in its own name because Ms. Vallecillo’s claim had never been assigned to RF&G.

The appellate court unanimously allowed Ms. Hyde’s appeal, finding that RF&G lacked standing to sue Ms. Hyde and that Roselia Vallecillo’s claim against Ms. Hyde had never been validly assigned to RF&G.

The Doctrine of Subrogation and Exceptions Thereto

The doctrine of subrogation applies to all contracts of non-marine insurance, including motor and fire insurance. It prevents the insured from recovering more than full indemnity and effectively allows an insurer to recover its losses against a tortfeasor who has harmed the insured. (See Paragraphs 32 and 33 of Hyde.)

Such actions are brought in the name of the insured, rather than the name of the insurer. However, there is an exception to the doctrine of subrogation. Where the insured has assigned its claim to the insurer, the insurer must bring a claim in its own name.

In an assigned claim, it is imperative that the plaintiff establish a valid assignment of the claim at issue, either in law or in equity.

In the Hyde case, the respondent, RF&G Insurance, attempted to rely on Condition 5 of its contract of insurance with Vallencino, which read as follows:

No admission offer promise or payment shall be made by or on behalf of the Insured without the written consent of the Company which shall be entitled if it so desires to take over and conduct in its name the defense or settlement of any claim or to prosecute in its name for its own benefit any claim for indemnity or damages or otherwise and shall have full discretion in the conduct of any proceedings and in the settlement of any claim and the Insured shall give such information and assistance as the Company may require.

(Hyde, Paragraph 28)

A number of facts were fatal to RF&G’s argument in favor of a valid assignment, however. Most importantly, the condition described above did not assign a valid, existing claim to RF&G. Instead, it merely assigned the right to pursue a claim that was not in existence at the time the contract was written. At that time, there was no loss and there was no payment for loss.

Further, the assignment was not in compliance with Section 133(1) of the Law of Property Act, Chapter 190. I will turn to that subject next.

The Law of Property Act

Section 133(1) of the Law of Property Act, Chapter 190 reads as follows:

(1) Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, shall be effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice –

(a) the legal right to such debt or thing in action;

(b) all legal remedies for the same; and

(c) …

A careful reading of the foregoing provision will show that “express notice in writing” must be given to the debtor for a valid assignment to exist.

In Hyde, the respondent insurance company argued that it’s attempt to secure reimbursement for its loss prior to instigating proceedings against the appellant counted as “express notice in writing.” The appellate court rejected that argument, finding that no less than formal notice in full compliance with the section was required.

An Equitable Assignment

The respondent insurance company also argued that there had been a valid equitable assignment insofar as the insured Vallecillo and RF&G entered into a valid contract for good consideration for the assignment of the former’s claim to the latter.


The appeal court rejected that argument for the same reason that they rejected the claim that the assignment was valid at law. Basically, when the contract was signed, there was not yet any claim to assign. It was a mere hypothetical. No loss had occurred and no payment for that loss had yet gone out.

Requirements for the Valid Assignment of a Claim in Belize

In Belize, therefore, a number of things must occur before a party can assign a claim, debt, or other cause of action to another party. They are as follows:

  1. The claim, debt, or other cause of action must be one that is already in existence. Except as anticipated under the doctrine of subrogation in insurance contracts, one cannot preemptively assign a claim to a third party in the anticipation that one will arise.
  1. Notice of the assignment must be expressly provided in writing to the debtor in compliance with The Law of Property Act.

Note that these are the requirements for assigning a claim at law. It is also possible to equitably assign a claim to a third party, although, simply complying with The Law of Property Act and the legal requirements are more certain and simple than relying on an equitable doctrine to ground one’s assignment.

Final Thoughts

In sum, it is possible to validly assign a claim, debt, or other cause of action to another party in Belize. However, the case of Hyde demonstrates the potential pitfalls and traps of doing so without due care or caution.

That case shows that courts will pay strict attention to the requirements found under The Law of Property Act and will not be quick to interpret the actions of an insurer or other assignee as meeting the requirements found in that act.

Insurers and other parties should take extreme care to ensure that both the timing and notice requirements set out in Hyde are met if they wish to rely on the assignment of a third party’s debt, claim, or cause of action.

Steven Toews

Can Foreign Judgments be Enforced in Belize Without a Mutual Enforcement of Judgments Act?

Author: Steven Towes

In the absence of an act of the legislature of Belize, foreign judgments may not be directly enforced by a court in Belize. They can, however, be indirectly enforced by the operation of the common law rule of enforcement by an action on the judgment. There are several exceptions to the common-law rule, as well as an exception regarding trusts formed under the of Belize.

The enforcement of foreign judgments pursuant to the common law

In order for a foreign judgment to be enforced in a Belize court, it must meet the criteria summarized in Halsbums Laws of England (4th edition), Vol. 8, Paragraph 725, which states:

Subject to three exceptions, a judgment in personam of a foreign court of competent jurisdiction which is final and conclusive on the merits is conclusive between the parties and privies as to any issue upon which it adjudicates. It is not impeachable or examinable on the merits, whether for error of fact or of law [emphasis added]

The exceptions referred to in the preceding passage are as follows:

  1. That the judgment was obtained by fraud
  2. That the judgment’s enforcement would be contrary to public policy
  3. That the judgment was obtained in proceedings which were contrary to natural justice

In every case, once a claimant has established that the foreign judgment is final and conclusive on the merits, the burden shifts to the defendant to demonstrate that the case falls under one of the three exceptions noted above. (See Godard v Gray [1870] LR 6 QB 139 at 149-150 and Ralli v Anguilia (1917) 15 SSLR 33 [Singapore])

The mechanism for enforcement of a foreign judgment is an action on the judgment itself. Having proved a final and conclusive judgment on the merits of the case at hand, a claimant is entitled to expect a Belize court to impose “a duty or obligation on the defendant to pay the sum for which the judgment is given [and] which the courts of this country are bound to enforce.” (Schibbsby v Westenholz (1870) LR 6 QB 155)

Whether a judgment was obtained by fraud

A foreign judgment is impeachable, meaning it will not be recognized or enforced in Belize pursuant to common law rules, if it was obtained by fraud. This can mean fraud on the part of the party seeking to enforce the judgment in Belize or fraud on the part of the court who issued the judgment. (See Dicey & Moms, The Conflict of Laws, 11th ed. (1987), Rule 44)

Fraud can be raised by a defendant seeking to prevent the recognition or enforcement of a foreign judgment for the first time in a Belize court, even if fraud was not raised as an issue in fre original, foreign proceedings. (See Jet Holdings v Patel [19901 IQB 335.)

In Prophecy Group v Seabreeze, Claim No. 185 of 2001 in the Supreme Court of Belize, the defendant Seabreeze alleged t•tat the American judgment         plaintiff Prophecy Group sought to enforce in Belize was tainted by fraud. Seabreeze had not participated in the proceedings in the United States. Instead, Prophecy Group had obtained default judgment against tie defendant in that jurisdiction. In Belize, Seabreeze argued that the default judgment was obtained by fraud on the part of Prophecy Group.

In that case, Justice Muria pointed out that, in order for the defendant to prevail on this point, the common law required that they present new evidence of a decisive character tiat established the plainiff had deliberately misled the foreign court with the intention to deceive. Note that proof of fraud would require a defendant to demonstrate a prima facie case tiat       plaintiff had both misled the previous tribunal and done so with the intent to deceive. As Justice Muria indicated, this would be a “difficult task.”

Whether the enforcement of a judgment would be contrary to public policy

Any judgment that would run counter to the public policy of Belize would not be recognized or enforced by a Belize court. This is a vague and case-specific category. But, generally, judgments that strike at the heart of fundamental principles of justice or the rule of law would not be recognized or enforced.

One can imagine cases in which a concern under this exception might arise. If, for example, a judgment was entered in a foreign court tnat included damages for blasphemy or that contained damages for a defendant failing to perform an illegal act, a Belize court could refrain from recognizing or enforcing an obligation to pay against that defendant on public policy grounds.

A determination under public policy grounds often overlaps with a Belize courts analysis under the principles of natural justice (discussed in the following section), insofar as the principles of natural justice are also important public policy considerations. In other words, a violation of the principles of natural justice could also entail that a judgment is unenforceable for reasons of public policy.

Whether a judgment was obtained contrary to principles of natural justice

In order for a foreign judgment to be enforced in Belize it must not be obtained contrary to the principles of substantial, or natural, justice. W•tat exacdy this means will depend on the nature of the case and the nature of the judgment a plaintiff is seeking to enforce.

The principle is laid out in Adams v Cape Industries PLC [19901 where the court states that:

“The notion of substantial justice must be govemed in a particular case by the nature of the proceedings under consideration…[BJoth our system and the federal system of the United States require, if there is no agreement between the parties, judicial assessment Tof damages]. “

Principles of natural justice require, at a minimum, that the defendant have been made aware of the proceedings against them and had a reasonable opportunity to participate in those proceedings.

Also, the principles of natural justice will be judged by the standards widely applicable in international law. For example, even if a foreign courts rules were followed to the letter, if those rules are “unjust,” according to intemational principles, the judgment will not be recognized or enforced in a Belize court

An interesting application of this exception arose in the previously mentioned case of Prophecy Group v Seabæeze and the appeal and cross-appeal Civil Appeal No. 4 of 2009 in the Court of Appeal of Belize.

In that case, the Supreme Court Justice refused to enforce the second default judgment entered by a Florida court against Seabreeze. The Leamed Justice found tnat the second default judgment contained an assessment of damages that amounted to nothing more than the plaintiffs estimate of the value of certain property owned by the defendant.

The appeal court overturned tiat finding, noting that the proceedings at issue were default proceedings in which the defendant took no part, despite having been given reasonable notice both of the proceedings and the ensuing judgment.

The appeal court also found that the defendant Seabreeze was estopped from arguing the issue of a breach of natural justice because they had previously tried, unsuccessfully, to argue the issue in Belize proceedings.

A quick note about trusts

If the assets of the defendant are held in a trust pursuant to the Trusts Act Chapter 202, the situation becomes more complicated. The trust regime in Belize is extraordinarily robust and can withstand the reach of creditors. Essentially, if a plaintiff wishes to enforce a foreign judgment against a defendant whose assets are located in Belize, they may wish to confirm that those assets are not held in a protective trust prior to embarking on a lengthy and expensive collection effort tlat may not be successful.

Final Thoughts

In sum, then, foreign judgments can be enforced, albeit indirectly, in Belize. The parw seeking to enforce the judgment must bring an action on the judgment. Assuming the judgment the plaintiff seeks to enforce is final and conclusive (ie. all relevant appeals and appeal periods have been exhausted) the defendant is given an opportunity to establish that the judgment falls under one of the three exceptions that will prevent a Belize court from enforcing the duties and obligations contained in the judgment.

To reiterate, those exceptions are:

  1. That the judgment was obtained by fraud
  2. That the judgment’s enforcement would be contrary to public policy
  3. That the judgment was obtained in proceedings which were contrary to natural justice

The onus is on the defendant to establish, on a balance of probabilities, that one of these exceptions applies. If one of them does, a Belize court will not enforce the judgment. If none of them apply, a Belize court is bound to enforce it.

The short answer to the question of whether foreign judgments are enforceable in a Belize court is “Yes, with some exceptions.” As is typical in the law, a party’s results in court will always depend heavily on the particular facts of their own case. The enforcement of foreign judgments are no exception.