A. Summary
- Before the UK Courts will
recognise/enforce a foreign Court Judgment against a State, two
requirements must generally be met pursuant to Section 31 of the
Civil Jurisdiction and Judgments Act 1982
("CJJA"):
- that the foreign Judgment would be so recognised/enforced if it had not been given against a State (i.e. the ordinary pre-requisites for the recognition/enforceability of a foreign Judgment are satisfied); and
- (in the absence of submission to enforcement proceedings in the UK by suit on the foreign Court Judgment) that the State would not have been immune from suit had the foreign Court applied rules corresponding to Sections 2-11 of the UK State Immunity Act 1978 (the "SIA"), since one of the exceptions to immunity would have applied.
- In Estate of Michael Heiser &
121 Ors v (1) Islamic Republic of Iran (2) Iranian Ministry of
Information & Security [2019] EWHC 2074 (QB), the English
High Court ruled that these criteria were not satisfied in respect
of twelve US Court Judgments arising out of terrorist incidents in
a number of countries in the Middle East in which Iran was alleged
to have been involved, and so it could not enforce them. That was
for the following reasons:
- In order for a US Court Judgment to be recognised/enforced in England, the common law required that, in the absence of any form of submission to the US Courts, the judgment debtor was present (or resident) in the US at the time the proceedings were instituted. Iran had neither submitted to the US Courts, and nor was it present (or resident) in the US.
- Further and in any event the US
Court, applying rules corresponding to Sections 2-11 of the UK SIA
(which meant applying those provisions but replacing references to
the UK with references to the US), would have determined that Iran
was immune from suit save in respect of matters leading to one of
the US Court Judgments. That was because none of the exceptions to
immunity would have applied in respect of the other eleven, in
particular:
- the relevant acts/omissions, save in respect of the one US Court Judgment, had not occurred within the US for the purposes of Section 5; and
- the state financial sponsorship of terrorism found by the US Courts did not amount to a "commercial transaction", and in any event the US proceedings leading to the Judgments did not "relate to" such a transaction, for the purposes of Section 3(1)(a).
- The Court also considered the rules
which are applicable when serving documents on a State, and
addressed the question of whether service of the claim form, and of
the Judgment subsequently entered in default, had been validly
effected in the circumstances of the case. It decided that:
- the claim form and accompanying documents had been validly served pursuant to Section 12(1) of the SIA since they were handed over within the Ministry of Foreign Affairs ("MFA") compound, and that was sufficient for them to have been "transmitted" through the Foreign and Commonwealth Office ("FCO") and "received at the Ministry";
- the Judgment in default that had
subsequently been obtained had, by contrast, not been validly
served pursuant to Section 12(5) of the SIA since:
- the MFA had refused to accept those papers when attempts were made to deliver them and as such, contrary to Certain Underwriters at Lloyd's of London v Syrian Arab Republic and Ors [2018] EWHC 385 (Comm), they could not have been "received", and
- notwithstanding a contrary statement in the order obtained "without notice" and also contrary to The European Union v Syrian Arab Republic [2018] EWHC 181 (Comm), service could not in fact have been effected by email as the word "received" involved some act of volition and Iran had not expressly agreed to accept email service.
- The Judgment demonstrates the
importance of agreeing in advance appropriate:
- forum selection agreements;
- waivers of immunity (in respect of suit, enforcement and/or forms of remedy/relief); and
- methods by which documents may be served
- Following this Judgment, difficulties may be encountered by a party seeking to serve documents on a State if, in the absence of an agreement on service methods, a State refused to accept those papers (or otherwise sought to avoid its legal obligations by obstructing service via the diplomatic route). Given the existence of conflicting first instance judgments as to the validity of service (and other similar issues) in such circumstances, the issue will probably be considered by the Court of Appeal in another case before too long – not least because it is particularly pertinent if service of the papers in question cannot be dispensed with.
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