Background
Aerotron sought a stay of enforcement after the High Court, in a judgment dated 23 July 2026, dismissed its application to refuse recognition and enforcement of two Maltese judgments. Aerotron lodged an appeal on 30 July 2026 and asked that enforcement be paused until that appeal was decided.
Hermes had served an Article 53 certificate, demanded payment and threatened to present a winding-up petition, but had not yet commenced enforcement proceedings. Aerotron said that, if it paid and later won its appeal, it faced a real risk of being unable to recover the money from Hermes, a dormant company that had not filed accounts in Malta. Aerotron had placed funds intended to cover the debt, interest and costs in its solicitors’ client account.
The Court’s Holding
Master Fontaine held that the High Court had jurisdiction to grant a stay even though formal enforcement proceedings had not yet begun. The applicable transitional CPR provisions contemplated an application to the High Court where the judgment debtor was unaware of enforcement proceedings, and the court also had jurisdiction under CPR 3.1(2)(g) in the circumstances.
The court granted a stay of enforcement and execution of the judgment debt and interest pending Aerotron’s appeal. Although a judgment creditor is ordinarily entitled to payment despite an appeal, Aerotron had shown solid grounds for an exception: there was a real risk that Hermes could not repay if the appeal succeeded, while threatened winding-up action could seriously disrupt Aerotron’s business and force payment for commercial reasons. Hermes showed no real prejudice from a stay, particularly as delay could be compensated by interest.
Key Takeaways
- A court may grant a pre-emptive stay where enforcement has been threatened but has not formally started.
- The applicant must provide cogent evidence that refusing a stay risks making a successful appeal practically worthless.
- A creditor’s apparent insolvency risk and lack of evidence of ability to repay can justify a stay pending appeal.
Why It Matters
The decision confirms that a judgment debtor need not wait for enforcement steps, including potentially damaging insolvency action, before seeking protective relief. It applies the established balance-of-prejudice approach to enforcement of foreign judgments under the Brussels Recast transitional regime.