Any debt will do: victory for common sense and foreign judgments

The Supreme Court has provided welcome clarity for creditors seeking to enforce foreign judgments through the bankruptcy regime in England and Wales. In Drelle v Servis-Terminal LLC [2026] UKSC 29, the Supreme Court confirmed that a foreign judgment can constitute a qualifying debt for the purposes of bankruptcy proceedings in England and Wales. 

The case concerned a Russian judgment requiring a former director to pay approximately RUB 2 billion. The debtor moved to the UK and so the creditor served a statutory demand and presented a bankruptcy petition in England. On appeal, the debtor argued that the Russian judgment could not support insolvency proceedings as it had not been subject of recognition proceedings.  

Whilst the High Court rejected that argument, the Court of Appeal held that a bankruptcy petition could not be founded on an unrecognised foreign judgment. The Supreme Court have now unanimously overturned that decision. 

Central to the judgment was the long-established common law “obligation principle”. The Supreme Court reaffirmed that where a foreign court of competent jurisdiction gives a final and conclusive judgment for a definite sum of money, that judgment creates an immediate legal obligation on the debtor to pay the judgment sum. Crucially, that obligation arises when the foreign judgment is given and does not depend upon recognition or registration in England and Wales. 

The Supreme Court considered whether that obligation amounted to a “debt” for the purposes of section 267 of the Insolvency Act 1986 (the “Act”). It concluded that it did. The term “debt” should be given its ordinary common law meaning, namely a legal obligation to pay a sum of money. Since a qualifying foreign judgment gives rise to such an obligation, it falls within the scope of section 267 of the Act. 

As Lords Briggs and Hamblen said: “any debt will do”. 

The decision removes a significant procedural hurdle for creditors holding the benefit of a foreign judgment. Previously, creditors faced uncertainty as to whether they first needed to obtain recognition of a foreign judgment or commence separate proceedings in England to obtain an English judgment before pursuing bankruptcy remedies. The Supreme Court has confirmed that neither step is required simply to establish a qualifying petition debt. 

That does not mean that every foreign judgment will automatically support bankruptcy proceedings. Creditors must still establish that the judgment satisfies the applicable common law requirements and should carefully consider whether insolvency proceedings represent the most effective recovery strategy. Early legal advice remains important to assess the position such as the enforceability of the judgment, jurisdiction, the debtor’s centre of main interests, and whether the jurisdictional conditions as set out within section 265 of the Act are satisfied before commencing proceedings. 

The Birketts view 

This is a sensible and commercially pragmatic decision. Had the Supreme Court reached the opposite conclusion, creditors holding foreign judgments would have faced unnecessary delay, expense and potentially duplicative proceedings before being able to pursue bankruptcy remedies. 

The judgment reinforces the principle that insolvency proceedings are concerned with genuine indebtedness rather than procedural technicalities.