## Facts

- Banque Libanaise Pour le Commerce, a French bank operating a branch in Abu Dhabi, entered a written overdraft facility in the name of Hanna Elias Khreich, a former Abu Dhabi contractor later residing in Texas.
- Khreich alleged the overdraft agreement was structured so that funds would effectively benefit Abdul Wahab Al‑Momayez, a contractor indebted to both Khreich and the bank, and that bank personnel assured Khreich he would not be personally liable.
- The bank later sought to recover 200,000 dirhams from Khreich under the overdraft agreement; Khreich contended the bank had collected funds from Wahab that should have extinguished any obligation.
- The bank obtained a judgment against Khreich in Abu Dhabi and then sued in federal court in the Northern District of Texas, seeking recovery on the overdraft and recognition/enforcement of the Abu Dhabi judgment.
- A Texas jury found for Khreich on a usury defense under Texas law; the district court entered judgment for Khreich based on that finding and declined to recognize the Abu Dhabi judgment under Texas’s foreign-country judgment recognition statute due to nonreciprocity.

## Issues

1. Whether the district court abused its discretion by declining to recognize and enforce the Abu Dhabi judgment based on a lack of reciprocal recognition of Texas judgments.
2. Whether the district court erred in applying Texas law (resulting in usury) rather than Abu Dhabi law, where the bank asserted the interest was lawful under Abu Dhabi law.

## Decision

- The Fifth Circuit affirmed the judgment for Khreich.
- The district court did not abuse its discretion in refusing recognition of the Abu Dhabi judgment because evidence supported a finding of nonreciprocity.
- The district court properly applied Texas law because the bank failed to prove the content and applicability of Abu Dhabi law with sufficient clarity.

## Legal Principles

- Under Texas’s foreign-country judgment recognition framework, a court may decline recognition when the foreign jurisdiction does not provide reciprocal recognition for Texas judgments; the decision is reviewed for abuse of discretion.
- The party invoking foreign law bears the burden to prove its substance and relevance; absent adequate proof, the forum may apply its own law.
- When forum law applies to a lending or credit arrangement, Texas usury rules can provide a complete defense if the interest charged exceeds statutory limits.

## Conclusion

The Fifth Circuit upheld a Texas judgment for the defendant because the bank could not compel recognition of an Abu Dhabi judgment in the absence of reciprocity and could not avoid Texas usury law without competent proof of governing Abu Dhabi law.


Banque Libanaise Pour le Commerce v. Khreich, 915 F.2d 1000 (5th Cir. 1990)