[1988] UGCA 1

$\mathbb{T}\mathbb{M}$ $\ldots \ldots$ **שתייסט** $\sigma_{\overline{U}}$ $*DDT*T$

$T$ $T$ $T$

MANYINDO V-P, LUBOCO AG. J. A., & ODCKI J. A.) (CODEM:

> APPTIL NO. 8 OF 1987 CIVIL

> > **Rummar**

PORTURAL PORTURA <pre>11:1::::::::::::::::::::::::: APPETYANT</pre>

AND

THE DRIVIAL HIGH COINTSSION ::::::::::::::: RESPONDING

Appeal from Ruling and Caller of the High gourt of Uranda (Behimaine Ar. J.) dated 25th June 1987

in

Civil Suit No. 100 of 1987)

## JUDGUTUIT OF CDOMI J. A:

This is an appeal against the ruling and order of the wich Court whereby the trial judge whold a proliminary objection that the suit was not maintainable arminat the respondent on the ground of diplomatic immunity.

The facts giving rise to this appeal are that the appellant sued the respondent claiming,, inter alis, a declaration that the respondent was in breach of a contract of sale of the suit property owned by the respondent and situate at Plot 17 Princess Anne Drive Bugolohi, and an order for vocant delivery of the property to the appellent. According to the plaint the contract of sale was concluded on 13th November, 1985 between the staff of the respondent and the appollant and the runchase " price was acreed at Shs. 85,000,000/= which was duly paid. Subsequently the respondent refused to hand over the house to the appellont.

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The respondent pleaded that it not ?. Verrod in the alternative that although it contemplated selling would first be approved by Her Majesty's Government in London which Government refused to accept the offer and the money deposited as purchase price The respondent also was returned to the appellant. person capable of to exercise jurisdiction over the action. the house to the appellant, it made it clear that any sale a juridical a branch of the Ministry of Foreign and Commonwealth /ffairs of the Un?ted Kingdom, and therefore the court should decline being sued, and alternatively that it was

the hearing of the suit, counsel for the respondent law that the respondent was not of being sued and therefore the action should be struck out. that under the Diplomatic Property and Consular conventions status with cap?city to sue and be sued. The appellant maintained that the roppondent was a loyal entity capable of incorporated under the Act. loyal entity. the raised a appellant that since the respondent had acquired lard preliminary point of it was a be:'ng sued since it represented the foreign country which was Act, Cap\* it is the foreign state which is given corporate a juridical person capable It was argued for the .respondent Furthermore, it was center'of by

The trial judge held that the United Kingdom ⁱ represented in Uy? rd by the it can be sued on behalf Government. She also held that the respondent proprietor of property. However, the trial judge then the suit property because it of ⁱ is corporate and ⁱ s aspordent as the mission staff in respect of the could be cued wa ^s the ^r c*r*ⁱ r. ^tere^d hold that since the suit property was a private ros-dq^igy eor nd therefore immune from attachment under the a body its agent, and therefore

/⁷

*2*

Vi ?. Convention on Diplomatic she accordingly dismissoi wi th cents• She was of the opinion that the matter should be handled diplomatically. proceed with the action which delations, it would be futile to

The appellant has preferred five grounds of appeal complaining essentially that the trial judge erred in law in holding that the covered by Articles 25(3) Vienna Convention on Diplomatic Relations and that therefore it a executed\* The respondent has filed a ground that the learned trial judge erred in law in holding that juridical person only by reason of the fact proprietor of the land, matter of the proceedings. and 30(1) of the decree which could not be suit property was cross-appeal on the solo would be a futile exercise to sue for the subject the respondent was a that it is registered as a

The first ground of appeal is that the learned trial judge orried in law and fact in holding: (a) that the suit pro;erty being residential property is covered by Article 30 of the Vi a Vienna Convention considerably reduced the effect of Diplomatic Property and. Consular Conventions Act. section 6(l) of the s 22(3) ond futile exercise to sue for a 30(1) of decree which cannot be executed and (c) that Articl Convention; (b) that it would be a.

learned counselerred in comingto the above conclusions view, the following findings represented by its -I rerresents the United Kingdom in **TT** Jnited Kingdom in Uganda is the a \* since she had made, correctly in his submitted tint the trial judge or representst?ve of the and therefore it can be sued in Uganda; (d) that the respondent body corporate and i (n) that the United Kingdom is a Er. <Kayor.de>, S. C, ,h Commission, the respondent, (b) that the res.nondent for the appel''-ant, nnda, (c) that the respondent

I

t?.e suit property, matters affecting title to land it is the or be sued and that an estate in land cannot be held by a non legal entity. registered proprietor of registered legal owner who can sue nd (0) that in is the

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\*

Counsel for the appellant contended that the tri jucHe argued that no evidence was led to prove operty wa^s miscion property. did not enjoy immunity in this case because the suit property wa s covered by Article 31 (1) excluded immunity in actions relating to immovable property. Counsel dited the case of Thai furore Tapioca Contention that jurisdiction over immovable land wa exception to diplomatic immunity. He submitted further that is He a r^u; as re bored proprietor on behalf of its Government. pi rally learned counsel for the appellant submitted that the question of the suit property Service T-td V. He of the Vienna Conventi.on ;;h? ch was his submission that the respondent (a) was well established that there was no absolute immunity. Gevernmc-nt of execution of a that the suit appellant could seek other means of enforcement. had addressed her mind wrongly on the issue of immunity. a recognised tlie United Kingdom, and moreover it was holdin decree was irrelvant since once obtained, the Pahis"a n (1975) 3 All g. P. 9^1 ^&gt; in support of his od that the respondent was rightly sued because it represented

to the a^pollart since the- exception applied to va^t ^e immovab1^e property but not property of the mission, s the case here • Moreover,' counsel' argued,\* Article Convention provided that property o ^f the mission stall enjoy immunity from execution. respondent could be sued Vi err. that Article Jl(l)(a) of the which w submitted 5\* Convention was of no as~?.tance As regards the contortion that the property, i'r. Kateera 3^(1) of the Vienna Ur. Kateera, learned counsel for the respondent, as registered properietor of the s submitted that what-was incorporated

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**J**

under section 6 of the Diplomatic Property and Consular Conventions Act with the power to acquire land and to be sued was the United Kingdom and not the respondent. Therefore, he contended, the suit was brought in the wrong party as the proper party should have been the United Kingdom. In dealing with the issue of diplomatic immunity, the learned trial judge said,

$\mathcal{L}$

"I now turn to the most important issue posed by the Diplomatic Privileges Act 1965 - Article 22 and 30 of the Vienna Convention on Diplomatic Relations thereunder.

According to S. I of this Act, Article 22 of the<br>Vienna Convention has the force of law and references therein to the receiving State shall for this purpose, be construed as reference to the sovereign State of Uranda. Article 22(3) States:-

"The premises of the mission, their furnishings<br>and other property thereon and the means of transport of the mission shall be immune from search requisition attackment or execution."

Article 30 goes on to Say

"The private residence of a diplomatic amount shall enjoy the same inviolability and protection as the premises of the mission."

The suit property is a residential property according to the valuation report on record. It must have been used as a private residence for the mission staff. It in therefore covered by Article 30 of the Convention.

It would be a futile exercise to sue for a decree which cannot be executed. That being the case, I am constrained to hold that Articles $22(3)$ and $30(1)$ of the Vienna Convention on Dinlomatic Relations considerably reduce the effect of Section $6(T)$ of the Diplomatic Property and Consular Conventions Act.

$\mathbb{I}$ am now of the considered view that this is a matter which can only be diplotically handled. We suit in accordingly diamissed with costs to the defendant."

The first point to consider is whether the trial judge was correct in holding that the suit property was covered by Article 30 of the Vienna Convention. In order for property to come within that provision, it must be shown that it is a private residence of a diplomatic a ent. When councel for the respondent sent a notice to admit facts to the appellant's counsel.

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requesting him to admit that "the property situate at Plot 17 Princess Anne Brive Bugolobi is the residence of a diplomatic agent and is the premises of the British Mission", counsel for the appollant replied, "The property situate at Plot No. 47 Princess Anne Drive Bugolobi is a property of the British High Commission as per copy of the Title Deed attached hereto and marked A". It is clear therefore that the appollant's councel refused to admit the claim that the suit property was a residence of a diplomatic agent.

The learned trial judge based her finding that the property was a residential house on the valuation report dated 19th June 1985 which was attached to the plaint. It is clear from that report that the property was residential house. At the time the report was prepared the property was not registered in the names of the respondent but in nemes of Reginald John Smith and Francis Welley, as joint tenants. The report does not indicate that the house was being used by the respondent for its staff. Nor is there any averagent in the written statement of defence that the property is a private recidence of a diplomatic agent. I am therefore unable to find any ovidence or ground upon which the learned trial judge based her finding that the property must have been used as a private residence for the mission $\texttt{striff}_\bullet$

In my opinion therefore the trial judge was in error in holding that the duit property was a private residence of the mission staff when there was no evidence to support that finding.

The next point contested is whether the trial judge was right in holding that it would be a futile exercise to sue for a decree which could not be executed. Mr. Kateera, for the respondent submitted that the case of Alcos 1td V. Popublic of Columbia (1984) 2 All. R. R. 6 supported the trial judges docision on this point. In thet case it was held by the House of Lords that international law prohibits the attachment by legal process of moneys standing to the credit of a current bank account of

. . . . . . . /?

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of a diplomatic mission that is used to defray the expenses incurred in performance of the functions of the mission. Fowever that decision does not in any way support the proposition that the outforcement jurisdiction controls the adjudicative jurisdiction of the court. On the contrary, the case recognises the distinction between these two separate functions of the courts in respect to proceedings by or against foreign states.

The distinction between the adjudicative and enforcement jurisdictions of the courts is recognised in the State Inmunity Act 1978 of the United Kingdom as well as in the Vienna Convention on Diplomatic Relations. For Instance, under Article 32 of the Vienna Convention, a State may waive Immunity from jurisdiction of its diplomatic agent. But waiwer from jurisdiction shall not be held to imply weiver of immunity in respect of the execution of the judgment, for which a separate waiver shall be necessary. It is therefore possible for a State to waive immunity in respect of adjudication and decline to do so in respect of execution. Similarly, it is possible for a foreign state to submit to adjudientive jurisdiction without necessary submitting to enforcementjurisdiction. Moreover, the fact that contain property cannot be a subject of attachment or execution does not mean that the rights of the parties in respect of a dispute over that property cannot be determined by the Immunity in respect of execution may be waived on other means of enforcement employed. It seems to me therefore that the learned trial judge was attempting to cross the bridge before she reached it. Once it had been established that the appellant had a right to sue the respondent, with a valid cause of action, then the question of whether the recultant decree was estable of exacution was, in my view, irrelevant.

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The learned trial judge reinforced her decision by holding that Articles 22(3) and 30(I) of the Vienne Convention densiderably reduced the effect of the provisions of S. $6(T)$ of the

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Diplomatic Property and Consular Conventions Act, which provides,

$16.(I)$ Every Commonwealth country shall be a body corporate by the name of that country with-

- $\binom{2}{2}$ perpetual succession and a common seal; and - $(5)$ power to sue and be sued in such corporate name; and - power to purchase, take and hold lauds and<br>other property without licence in mortmain $(\sigma)$ for purposes substantially similar to those for which a foreign State may hold land pursuant to section 5 of this Act and, with the approval of the Minister, for any other purposes arising out of the rolations between Uganda and such country:

Provided that if the corporate body ceases to use such lands and any buildings thereon for such purposes then the corporate body shell in the first instance offer such lands and buildings to the Government."

Who learned trial judge also referred to subsection 2 of Section 6 of the above Act which provides,

> "The Senl of a corporate body of the kind referred to in Subsection (I) of this Section shall be authenticated by the signature of an officer in service of the country the name of which the corrorate body bears (being an officer holding a rank) who is authorised so to act and every document purporting to be an instrument issued by<br>the corporate body in the exercise of its powers under peragraphs (b) and (c) of subsection (T) of this section and to be scaled with the scal of the corporate body authenticated in the manner provided by this Subsection shell be received in evidence and deemed to be such an instrument without proof unless the contrary is shown."

The trial judge then concluded,

"Consequently United Kingdom is a body Corporate and represented in Uganda by its High Commission under the name "Eritish High Commission".

The functions of the High Commission are spelt out by Article 3 of the Schedule (Vienna Condention<br>on Diplomatic Polations) to the Diplomatic Privileges Act 1965. I consider only the first two relevant here i.e.

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representing in the sending state;

*0*

**o** *⁹*

protecting in the receiving state the interests of the sending state and of its nationals, within the limits permitted by international law. (b

It follows, therefore, that the British High Comnnssj on is the agent and or representative of Britain in Uganda and therefore can be sued on her behalf."

One of the declared objectives of the Diplomatic Property and Consular Conventions Act was "to enable certa-in foreign states and Accordingly Section 6(1) of the Act incorporated commonwealth countries maintaining diplomatic relations with Uganda for the but may authenticate the seals of their sending states. It follows therefore that only states can acquire and hold land in their corporate and the fact that they represent their sending states does not alter the position# Commonwealth countries to acquire property in their own names names. Diplomatic missions have no such powers under this Act, purpose of acquiring land. Diplomatic missions are not so incorporated

Accordingly I am of the considered view that the respondent had no power to acquire and hold the property in its name\* the British High Commission. The property could only be acquired and registered in the name of the sending state, the United Kingdom which the respondent was representing. Indeed Mr. Kateera learned counsel for the respondent rigjhtly conceded that the registration of the property in the name of the British High Commission was a mistake.

above Act only states, are incorporated with capacity to sue and be sued in respect of real property. Diplomatic missions have no such corporate status nor the capacity to sue or be sued. The function of the mission is to represent the sending state. This function does not include the power to sue and be sued in the receiving state. Furthermore it is common ground that under S. 6(1) of the No authority was cited to us nor can I find any to support the proposition that a diplomatic mission can be sued on behalf of the

/10

sending state# I would, therefore, hold that the British High Commission cannot be sued on bahalf of the United Kingdom: because the mission has no legal capacity to sue and be sued.

The learned trial judge held that Articles 22 and 30 of the Vienna Convention considerably reduced the effect of section 6 of the Diplomatic Property and consular conventions Act# It is true But neither Article 22 nor Article 30 directly or indirectly gives immunity from, civil action to a foreign state or a diplomatic mission# It is article 31 of the convention which provides for immunity of diplomatic agents from criminal and civil proceedings, except in certain respects. foreign states as such. of international law. trial judge was not correct in holding that Articles 22 and 30 of the Vienna Convention considerably reduced the effect of Section 6 of the Diplomatic Property and Consular Conventions Act. But Article 31 does not provide any immunity to State immunity is provided for under/rules I am therefore of the opinion that the learned that S# 6(1) of the Act confers upon the foreign state the capacity to sue and be sued ^wirfth the two Articles of the convention provide immunity from execution in respect of diplomatic property#

It was urged before us by Mr# Kateera, counsel for the respondent, it could not be sued in Uganda because it enjoyed sovereign immunity# Counsel pointed out that the mission is merely an emanation of the foreign state# The buildings of the mission therefore belong to the sending state# Mr# KateelJa submitted that according the doctrine that there has been a movement away from the principle of absolute that since the British High Commission was merely a branch of the foreign and Commonwealth office of the United Kingdom Government, of absolute sovereign immunity which was laid down in cases such as Parliament B£rge (1874^80) ^ASSR^Rep. 104 and the Cristina (1938) **All££""** 719> municipal courts could not implead a foreign state or attach its property without its consent# Counsel conceded however,

to land or commercial transactions. In this respect counsel referred LRC (const) 215) *f* immunity towards that of restrictive immunity according to which a state did not enjoy immunity in certain cases like actions relating to The Philippine Admiral V. Wallen Shipping (Hong Kong) Ltd. (1976) I AijER 78, ^c^hai Europe Topiaca V Government of Pakistan (1975 3 AUER 94 and Barker McCormac (pVt) Ltd. V. Government of Kenya (1986)

Mr. Kateera then submitted that the exceptions which would bring the instant action within the purview of the principle of from jurisdiction under the Diplomatic Privileges Act, and secondly, the act of selling the house was a public or sovereign act (jure imperii) Accordingly, jurisdiction over the respondent. and not a private or commercial transaction (jure ^.estiont^. contended counsel, the court had neither the adjudicative nor enforcement restrictive immunity were not applicable because firstly the suit property being a private residence of a diplomatic mission was immune

Mr. Kayondo, counsel for the appellant, since the action related to immovable land and the transaction in dispute Mias from diplomatic immunity under Article 31(1) of the Vienna Convention which provides: a commercial transaction which were recognized exceptions On the other handsubmitted that the respondent did not enjoy immunity in this case

> "1. A diplomatic agent shall enjoy immunity from the criminal jurisdiction of the receiving state. He shall also enjoy immunity from its civil and administrative jurisdiction except in the case of:

(a) a real action relating tq private immovable property situated in the territory of the receiving state, unless he holds it on behalf of the sending state for the purpose of the mission;

(b) an action relating to succession in which the diplomatic agent is involved as executor administrator heir or legatee as a private person and not on behalf of the sending state;

(c) an action relating to any professional or commercial activity exercised by the diplomatic agent in the receiving state outside his official functions.11

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Counsel contended that these exceptions are also recognised in the case of Thai - Europe Tapioca Services Ltd. V. Government of Pakistan (supra), and that therefore the courts have moved away from the doctrine of absolute immunity to that of restrictive immunity as conceded by counsel for the respondent.

Q ¹²

I am unable to accept the contention of counsel for the appellant It is common ground that the suit property is not private immovable property but property of the mission. It was not argued nor was it established that the purported sale of the property was undertaken by a. diplomatic agent privately and outside his official functions\*' On the contrary it is argued for the appellant that the respondent sold the property as a representative of the United Kingdom. Moreover, the said provision confers jurisdictional immunity on diplomatic agents and not any other person or body. Diplomatic agent is defined in Article 1 of Vienna Convention as "the head of the mission, or a member of the diplomatic staff or mission, tt and mothers of the diplomatic staff "are members of the staff of the mission having diplomatic rank". that Article 31(1) of the Vienna Convention applies to this case. In opinion, Article 31 can only be invoked in respect of proceedings involving diplomatic agents.

The substantial question to be decided however, is whether action. It has long been established from principles of public international law and comity that municipal courts of any country have no jurisdiction to entertain an action or other proceedings against a forei^i sovereign, foreign state or a department of a foreign government, without their consent. In the Pariement Beige (1879) 4 p\*D. 129 Lord Summer said. / the respondent is entitled to enjoy sovereign immunity in the instant

> "The principle is well settled that a foreign sovereign is not liable to be impleaded in the municipal courts of this country, but is subject to their jurisdiction only when he submits to it, or by appearance as a defendant without objection".

> > A3

The principle was later restated by what has come to be known as the classical formulation of the rule in the case of Campania Naviera Nascongada V. S. S# Cristina (1938) 1 A/t. E. R. 719 (1938) A. C.485 where Lord Atkin said,

> "The foundation for the application to set aside the writ and arrest of the ship is to be found in two propositions of international law engrafted on to our domestic law which seem to me tobe well established. The first is that the courts of a country will not implead a foreign .'Sovereign# That is they will not by their process make him against his will a party to legal proceedings whether the proceedings involve process against his person or seek to recover from him a specific property or damages# The second is that they will not by their process whether the sovereign is a party to the proceedings or not seize or detain property which is his or of which he is in possession or control#"

The rationale for the doctrine of sovereign immunity is that the exercise of jurisdiction would be incompatible with the regal dignity and sovereign equality and independence of a foreign state# It is said that it would to be degrade the dignity of a state by placing it or its soveign rights under the jurisdiction of another, against its will# In Juan Tsmael & Co# Inc# V# Indonesian Government (1955) A. C.72, Earl Jowitt said at P.86,

> ''The rule according to which a foreign sovereign government enjoys immunity against being sued has been considered and applied in many cases# The basis of the rule is that it is beneath the dignity a foreign government to submit to the jurisdiction of an alie^K court ^CuaA that no government should be faced with the alternative of either submitting to such indignity or losing its property#"

reasons for the rule: ^nd in the Cristina case (Supra) Lord Wright gave the following

> ''This is sometimes said to flow from international comity or courteSy, but may now properly be regarded as a rule of international law, accepted by the community of nations# It is binding on the municipal courts of this country in the sense and to the extent that it has been received and enforced by these courts # It is true that it involves a subtraction from the sovereignty of the state, which reyi e>uces pro tanto the competence of its courts to exercise their jurisdiction even over matters occurring within its territorial limits, though prima facie an intergral part of sovereignty# The rule may be said to be based on the principle 'par in parem non habet imperium', no state can claim jurisdiction over another

sovereign state\* Or it may be rested on the circumstances that in general, the judgnent of a municipal court could not be enforced against a foreign sovereign state or that the attempt to enforce might be regarded §s an unfriendly act\* Or it may be taken to flow from reciprocity; each sovereign state within the community of nations accepting some subtraction from its full sovereignty in return for similar concessions on the side of others\*"

In a recent decission, Trendtex Trading Corporation Ltd\* V\* Central Bank of Nigeria (1977,) 1 Ait. E. R. 881 Lord Denning KH\* said at P.888,

> "The doctrine of sovereign immunity is based on international law\* It is one of the rules of international law that a sovereign state should not be impleaded in the courts of another sovereign state against its will\* Like all rules of international law, this rule is said to arise out of the consesus of the civilised nations of the would\* All nations agree on it\* So it is part of the law of nations".

subject of controversy for some time\* which have been advanced in this respect\* to the doctrine of absolute immunity and the second theory postulates the doctrine of restrictive or relative immunity\* According to the doctrine of absolute immunity, jurisdictional immunity is granted to On the other hand the doctrine of restrictive immunity confers immunity in respect of public or sovereign acts and denies immunity in cases relating to commercial or trading transactions: See Trendtex Trading Corporation Ltd\* V. Central Bank of Nigeria (supra) and 1 Congreso del Parlido (1981) 2 A|(. E. R. 1064. foreign states in all cases except where the immunity has been waived\* See the Pariement Beige (supra) and the Cristina (supra)\* The scope of the doctrine of sovereign immunity has been the There are two conflicting theories The first theory adheres

under general international law: jurisdiction not from legal responsibility. The exceptions recognised under English law include actions relating to trust funds and immovable property situdted in England\* there is no immunity from international responsibility where this exists ikere is immunity from the local However, even under the principle of absolute immunity, there are limitations and exceptions, and the immunity can •Moreover,

In Thai-Europe Tapioca Service Ltd. V. Government of Pakistan (supra)

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two more exceptions to sovereign immunity were added, namely actions relating to debts incurred for services rendered to property in England

and actions concerning commercial transactions *•* Lord Denning M. R.

*gave* the following four exceptions:

**o**

''First a foreigner has no immunity in respect of -land situate in England. If he takes a lease of land and fails to pay rent the lessor can institute proceedings for forfeiture. If he borrows money on mortgage of land here and fails to pay the interest, the mortgagee can pursue his usual remedies: See The Charfeeh (1873) L. R. 4A & E 59 at 97 by Sir Robert Phillimore.

Second, a foreign sovereign has no immunity in respect of trust funds here or money lodged for the payment of creditors. The English beneficiary or creditor can ask the English courts to adjudicate on the claim even though the foreign government declines to appears. See Laviviere V. Morgan (1872) 7 Ch App. 550\*

Third, a foreign sovereign has no immunity in respect of debts incurred here for services rendered to its property here. If he owns a trading vessel when goes around on own shores, the tugs which pull it off are entitled to be paid and if not paid, the vessel can be arrested Likewise if a foreign government owns a motor vehicle here and sends it to a garage here to be repaired, the repairer is entitled to be paid and if not paid, he can claim a lieft on the car...

Fourth, a foreign sovereign has no immunity when it enters into a commercial transaction with a trader here and a dispute arises which is properly within the territorial jurisdiction of our courts. If a foreign government incorporates a legal entity which buys commodities on the London market, or if it has a state department which charters ships on the Baltic Exchange, it thereby enters into the market places of the world and international conMty requires that it should abide by the rules of the market."

The doctrine of absolute immunity was adopted a century ago when no sovereign state engaged in commercial activities. The state kept to the tradional functions of a sovereign namely, to maintain law and order, to conduct foreign affairs and to defend the country. But since the last wofid war, there has been in the functions of a sovereign state with the consequence that nearly every country enganges in commercial activities. It is this phenomenon which has contributed to the general acceptance of the theory of restrictive immunity in place of that of absolute immunity\* a complete transformation

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The definitive absorption by the common law of the restrictive theory of sovereign immunity was marked by the seminal judgment of Lord Denning M. R. in the case of Trendter Treding Componation Ltd. V. Central Dank of Migeria (supra) where the Master of the Rolls discussed the change in the rule of severeign immunity as follows:

> "In the last 50 years there has been complete transformation in the functions of a sovereign state. Rearly every country now engages in commercial activities. It has its departments of state or creates its own legal entities- which go into the Success Tos own regar endedies- which go into the<br>Market places of the world. They charter ships.<br>They but commodities. They issue letters of credit.<br>This transformation has changed the rules of international Law relating to sovereign immunity. So many have departed from it that it can no longer be considered a<br>rule of international law. It has been replaced by a doctrine of restrictive immunity. This doctrine gives immunity to acts of a governmental nature described in Latin as jure imporii, but no immunity to acts of a commercial nature jure gestionis. In 1951 Profescor Lautermacht showed that even at that date many European countries had abandoned the doctrine of absolute immunity and adopted that of restrictive immunity: See his important article<br>entitled "The Problem of Jurisdictional Immunities of<br>Foreign States" 28 BYIL 220, 272. Since that date there has been important conversion to the same view. Great impetus was given to it in 1952 in the femous Tate letter in the United States. Many countries have now adopted it. We have been given a valuable collection of recent decissions in which the courts of Belgium, Holland, the German Federal Republic, the United States of America and others have abandoned absolute immunity and granted only restrictive immunity."

In the case of the Philippine (dmirel (Crarge) $V$ . Tallen Chimping (Cong Mong) Etd. (1976) I All R. R. 78, the Privy Council empressed the view that the restrictive theory of sovereign immunity was more consonant with justice when it said,

> "... the trend of opinion in the world outside the Commonwealth since the last wer has been increasingly egainst the application of the doctivine of covereign immunity to ordinary trading transactions ........... that Lord Ships themselves think that it is wrong that it should be so applied ..... Thinking as they do that the restrictive theory is more component with justice, they do not think that they should be deterred from applying it ........"

The lording English authority on the doctrine of mentrictive immunity is now probably the House of Jords decision in T Congress

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del Partido (1981) 2 A)|; E. B.1064, In that case, previous English case The House of Lord held that according to the restrictive theory of sovereign immunity so that a sovereign state had no absolute immunity as regards commercial or trading transactions . Lord Wilberforce who wrote the leading speech stated the present position of English law as follows\* decisions including the Trendtex case (supra) and the Philippine (supra) were referred to as well as deces^ions from other European countries and the United States. actions whether *commeytCdi* in personam or in rem were to be decided

> This can The classic formulation of this was ida V A C 485 which is too well known to require citation and as regards trading vessels, The Porto Alexandre (1920) P.30 (1918-19) A||l E. R. Rep. 1015 purportedly applying the Parlement Berge (1880) 5 P. D. 197, (1874-80) Afl E. R. Rep. 104. In 1977 there were reported two land mark; cases: The Philippine Admiral (Owners) V. V/allen Shipping (Hong Kong) Ltd (1976) 1 All E. R. 78 (1977) A. C. 373 and Trendeiex Trading Corporation V. Central Bank of Nigeria ri977Fl All E. R. 881 (1977) Q\*B. 529< In Philippine Admiral, the Judicial Committee of the Privy Council in an appeal from Hong Kong declined to follow the Porto Alexandre and decided to apply the restrictive doctrine to an action in rem against a state owned trading vessel. In the comprehensive judgment which was delivered on behalf of the Board, it was said that to do so was wore consonant with justice. The other landmark authority (Trendtex) a decission of the court of Appeal establishes that as a matter of contemporary instexnational law, the restrictive theory should be generally applied." "I can now try to state the English law. be done without complication to a certain point. Until 1975 it would have been true to say that England almost alone of the influential trading nations, (the United States of America having changed its position under the Tate letter in 1952, i.e. the letter addresed on 19th May 1952 by J. B. Tate the Acting Legal Adviser of the State Department to the then Acting Attorney General of the United States notifying a change in the policy of the Department of state with regard to the granting of sovereign immunity to foreign governments) continued to adhere to a pure absolute doctrine of state immunity in all cases. that of Lord Atkin in Campania Naviera Vascon Steamship Cristina (1938) 1 A||. E. R. 719 (1938

> > /18

In Barker McCormac Put Ltd V. Government of Menya (1986) L. R. C. Const 215, the Wirk Court of Zimbabwe hold that the nature of the doctrine of sovereign immunity was a question of international law to be applied as part of the Law of Zimbabwe. The court held further that the doctrine now generally applied in international law was that of restrictive inmunity and that there was nothing in the decisions of the courts or in the legislation inconsistent with this dectrine.

$-18 -$

I am highly persuaded by the authorities I have referred to and come to the conclusion that the doctrine of absolute immunity hes given way to the doctrine of restrictive immunity and that the doctrine now generally applied under international law (and common law alike) is that of restrictive immunity. It is therefore my considered opinion that the doctrine of mastrictive sovereign immunity should be accepted and applied by the courts as part of the law of Uganda.

The most difficult problem when applying the doctrine of restrictive immunity is to distinguish between governmental or severeign acts (jure imperii) and commercial or trading transportions (jure gestionis) because it is not always easy to compartmentalize State activities into governmental or commercial activities. Hord Wilberforce drew attention to these difficulties in the Commeso case (supra) :

> "In other situations it may not be easy to decide whether the act complained of is within the area of non-immune activity or is in an act of sovereignty wholly outside. The activities of States cannot always be compartmentalised into trading or governmental activities, and what is one to make n case where a state has and in the relevant circumstances clearly displayed both a commercial interest and a severeign or governmental interest? To which is the critical action to be attributed? Such questions are more difficult since they arise<br>at an early stage in the proceedings and in all<br>probability on affidavit evidence. This difficult This difficulty is inherent in the nature of the restrictive dectrine introducing as it does an exception based on a certain state of facts to a plain rule."

> > $...$ /20

The conceptual difficulties involved in formulating a satisfactory method of differentiating between acts jure importi and acts jure gestionis have led some commentators to declare that the distinction is Unworkable. But as was said in the Glaim Against the Empire of Iran Gase 45 I L. R. 57 at pp 79-80 these difficulties are no good reason for abandoning the distinction:

$-19-$

"The fact that it is difficult to draw the line between sovereign and non-sovereign State activities is no reason for abandoning the distinction.<br>International law knows of other similar difficulties....... The distinction between sovereign and non-sovereign. State activities cannot be drawn according to the purpose of the State transaction and wether it stands in a recognisable relation to the sovered m duties of the State. For ultimately activities of State if not wholly then to the widest degree serve sovereign purposes and duties, and stand in a still recognizable relationship to them. Hoither should the distraction depend on whether the State has acted commercially. Commercial activities of States are not different in their neture from other non-sovereign State activities."

It seems well settled, however, that in determing whether an act is a governmental or commodal activity the court must consider the framewas nature and not the purpose of the act which forms the basis of the claim. See the mrendten Case (cupra) the Correso Case (supra). In the Claim Auginatities Empire of Irin case (supra), the Federal Constitutional Court of German Federal Republic said,

> MAC means for determining the distinction between acts jure imperii and jure gestionis one should rather<br>refer to the nature of the State transaction or the resulting legal relationships and not the motive or purpose of the State activity. It thus depends on whether the foreign State has acted in exercise of its sovereign authority, that is in public law<br>or like a private person, that is in private law."

In the <u>Congress</u> case Iord Denning M. R. in the Court of Appeal (at (1981) I All E. R. 1092 at p. 1102) illustratively confirmed the view that the paramount consideration is the nature of the action not its purpose or motive. He said,

$\frac{1}{2}$

"... there is always some action taken or omitted by the foreign government or by one of their separate legal entities which gives rise to the dispute. Sovereign immunity depends on the nature of that action: not on the purpose or intent or motive, use which ever word you like, with which it is done. To prove this I would take the old Chestnut. All pundits say that when a government department<br>places an order for boots for the army it is<br>acting jure imperii but when it places an order<br>for guns it is jure **perturned.** I cannot accept<br>that distinction. Suppose the of a foreign government orders a helicopter for miltary purposes and their agriculture department orders a like helicopter for surveying fields. In neither case is the foreign government entitled to sovereign immunity. The seller is not concerned whether the foreign government wants to kill an enemy or to fire a salute or to train recruits."

The approach in determining the nature of the activity in question is to first to consider what the relevant act is which forms the basis of the claim and \$2cond to characterize the activity into which the defendant state has entered. In the Congress case (supra) at p. 1070 Lord Wilberforce stated the first concideration as follows:

> When therefore a claimis brought against a State:..... and state immunity is claimed it is recessary to consider that the relevant act is which forms the basis of the claim, Is this under the old terminology en act jure gestionis or it is an act jure imporii; is it (to adopt the translation of those catch words used in the Mate Letter) a private act or ig it a sovereign or public act, a private act reamin<br>in this context an act of a private law character such as a private citizen might have entered into?"

Later on an his speech (at p. 1072) Lord Wilberforce went) to state the second consideration:

> WUnder the restrictive theory the court has first to charaterise the activity into which the defondant has entered. Having done this, and (assumedly) found it to be a commercial or private law, character, it may take the view that contractual breaches or torts, prima facie fall within the same sphere of activity. It should then be for the<br>defendant state to make a case (c.f. Juan Normal<br>(1952) All R. R. 572 (1952) A. C. 582) that the act<br>complained of is outside that sphere and within that of sovereign action."

> > ......../ $22$ whole context in which the claim against the state is made with a view to decidin' is based should in the context be considered to be within the area of commercial or private law character or within the sphere of ^overnr:ent^a¹ sovereignty# As Lord 'Vilberforce pointed out in the Conorsco case (supra) at p. 10?^, Tn addition to trie above two matter^, in considering whether state immunity should be granted, the court should consider the whether the relevant act on v/hich the claim

2|

relevant been done of governmental "The conclusion which emerges is that in considering under the restrictive theory whether state immunity whould be granted or not, the court must consider the whole context in which the claim against the State is made with a view to deciding whether the relevant act(s) on which the claim is based should in that context be considered as fairly within an area of activity of trading or commercial or otherwise of a private law character in which the State has chosen to ^eB:v'ar'e or whether the o.ct(s) should be considered as havir< outside that area and within the sphere or sovereign activityt."

basis of the claim is the breach respondor.t ' s property • The activity into which the respondent entered wit; the appellant is the agreement for purchase of real property• The respondent was representing a foreign 3 tnte and private individual\* have entered into? The question is whether to be^sovereign commercial, the material act or activity can fairly be said governmental or public imperii) or is it of a agreement for sale of the the appellant was a or rpivate law character such as a private citizen might instant case, the relevant^ act which forms the of ?n

issue# coiT.ntries# I begin with the house of Lords decision in the case of I Centrosc del Peptide (supra)\* Before answering this question it is necessary to consider some of the relevant authorities which have dealt with the I shall refer to only four decisions from different

**/?3**

The facts of the Centreso ce.se were that agreed to sell to sugar. The was dischargin, sor.c, the Government in Chille which had been on friendly terms was overthrown and replaced by a new government which the :an ship between the two countries were severed and Cuba decided to have no further dealings with Chille. The Cuban government ordered .lor to proceed to I'orth Vietinam. disposed ⁶ by Kambisa Cuban enterprise tender the'.control of the Cuban Government though not ship, the Congrcoo in Ragland. brought an action against the Con^reso claiming damage Cargo. The Congreso subsequent? y arrested in Tng? and. sugar was conversion and/or breach of contract for non-delivery acting on behalf of the Cuban Government took delivery of another of the The owners of the cargo of sugar The cargo was government found to be politically repugnant. a Cuban enterprise Diplomatic relationwas still on the high the ship to return with the reminder of the cargo and the o a Chi1lean company a quantity of despatched on two ships\*While one ship her cargo at a Chillean port and the other a government department. Kapisa then

**2Z**

The Republic sot aside on the ground that it was entitled to invoke sovereign immunity try respect of the proceedings. The plaintiff contended descended into regard to any default in its transactions. The whi ¹^e co:icod^~ r< that it ^o absolute immunity in the circumstances t o c1aim immunity delivery of the sugar to the Chillean consignees was its foreign policy. Republic of Cuba -pfoM suit, contended t-at it was entitled in the circumstances because its action in preventing of Cuba moved to have the plaintiff's writs done in the exercise that when a sovereign state engaged in commerce or cf its sovereign authority (jure imperii) was not entitled The trial judge upheld the the market place, it cou^d net later claim sovereign immrniij in

*•*

Republic's claim to sovereign immunity and the plaintiffs appealed. The Court of Appeal dismissed the appeals. The plaintific appealed to the House of Lords which allowed the appeals holding that the defendants were not entitled to immunity because the acts done by the Republic of Cuba in deciding not to complete unloading at Valparaiso or discharging in Chille were acts done as owners of the Vessel and invoked no governmental authority and exercised no sovereign powers, and in the case of the second ship the acts complained of, the discharge and sale of cargo. were effected under private law and not in exercise of any sovereign powers.

The second case is the Claim Against the Empire of Fran (supra) decided by the Federal Constitutional Court of the German Federal Republic in 1953. The brief facts of the case were that a firm of builders in Cologne carried out some repairs to the central heating system in the Embassy of the Empire of Iran on the instructions of theAmbassedor. Their claim was for the cost of repairs. The question was whether the Ironian Empire, a powereign State, could be sued for the recovery of the money in German municipal courts. The court answered the question in the affirmative, holding that the contract for regains was to be recorded as a rensevereing function of the foreign state. The court caid, (at p. 81)

> whis court has therefore examined the argument that the conclusion of the contract for repair is to be regarded as a non-sovereign function of the foreign State, and has a coopted this proposition as correct. It is obvious that the conclusion of a contract of this kind does not fall within the essential sphere of State authority. It does not depend on ............ to whether the conclusion of the contract was necessary for the regular transaction of the Embassy's affairs and therefore stood in a recognizebic relationship with the covereign functions of the sending State. Whether a State is embitled to immunity does not depend on the purpose of the function which the foreign State is thoroby pursuing."

The next two cases are more relevant to the present action dealing as they do mith transactions relating to land. In the case of Ntat Papagnol V. Societe Anonyme de l'Fotel George V

...... $125$

(1970) 52 317, the Spanish Consul-General in Pa' beha. If of the Direction General del Turismo, a departnent lease of premises in the city\* the Spanish Council of Ministers was drawn up in theform of and contained the terms and conditions usual in a normal lease of commercial property. Thrcee years after Grand Instance of Paris for eviction of the Bireccion General del TurisIMo• Intervening in the proceedings the Spanish State claimed jurisdictional immunity^t private low, not an act of sovereignity Spanish State was not entitled to jurisdictional immunity. Hotel George 7 company instituted proceedings in the Tribunal del Information and The ^sparish State connected with the Ministry of of the which was approved by and therefore the Tourism concluded a Tke plea failed ffi- Ccv-t+ ktcUi^ that the condlusion of a lease was a commercial act, governed by is, on the lense had been entered into the owners of the premises, the

The Court conclude (L;

conclude from these facts the t the lease from containing clauses which are not of a private law character reaffirms on the contrary all the usual stipulations. Therefore the Dircccion General de Turismo contracted with the Hotel George 7 compnay in the form) in the manner and in accordance with private law, as if it had been an individual. It acted in performance of ar. activity which is at least in part commercial and wit', out recourse to the exercise of nny public authority. There is no fact indicating that in so acting the department performed an act involving the sovereignty of the Spanish State\*"

of imbnbwo in her McCofmac Pvt Ltd 7. G^o vernmer. t ^o :reny.q (1986) L.2. C. Const. 215. Here the plaintiff company had be premises in an i-\*h Commission in Zimbabwe. Tn due course the defendant refused rn'.iQ /2^ option to rerev/ the lease in respect of view to usino the premises acquired the lessor's interest with a which the defendant the lessee of ararC- under a lease containing os its to renew the lease and the nlaintiff having reluctantly lost authority is the recent decision of t. e High Court

vacated the premises and found others to sue the defendant for damages for breach of the lease• The defendant having refused service igh Court for substituted service under 0 6r. *k/G* of the TTigh Court of Zimbabwe ?ules, dismissed on the ground that the purchase defendant was an act jure imperii and it could not therefore a gainst its will be made a party to legal proceedings in municipal courts of Zimbabwe. The plaintiff appealed and the Supreme Court allowed the appeal granting leave for substituted service.i In absolute sovereign immunity still applied in Zimbabwe and that the defendants plea in the matter at issue were acta jure imperii. higher rental, wishes a a applied to the H? even if the restrictive theory of sovereign immunity was adopted^ of jurisdictional immunity was still valid as its action, a special plea in bar arguing, inter ~lia, that the doctrine of the proceedings which followed such service, the defendant raised of the summons, the plaintiff of the premises by the but the application was

**o** -

jurisdiction matter alleged breach of the landlord and and the .-pose behind the defendant's brcrch of t:-t relationship could- not alter its character. Tn coning to th-s conclusion The act of entering The was an at p. The High Court dismissed the specialplea hold?ng that the doctrine of restrictive^applied in Zimbabwe\* court held that though the purpose of the defendant's purchase into a as to premises was use as its High terms of the- lease. ommission, and its purchase act jure imperii, the act of purchase was not the subject of the plaintiffs complaint hut \*•. 'rather it was the of the Samatti J. said, tenant relationship was a non-sovereign oct

> "It is not in dispute th-t the defendant purchased the property for the purpose of using it as its High'Commission. Mr, Ilkusli submitted that this having been the purpose, the purchase was on act jure imperii. l'think this contention may well be valid, but it is not helpful to the defendant in this case as far as the plea oi jurisdictional immunity is concerted. Its purchase of the property

did not in any way interfere with the mights of the plaintiff as a lessee and therefore that<br>act could not be the subject matter of a<br>complaint by the plainthffs. The act which forms the basis of the plaintiffs claim is the alleged breach by the defendant of the lease and not the<br>purchase of the property. Assuming that the alleged breach did take place it is clear that it happened because the defendant wented to use the leased premises as part of its Migh Commission. Does this reason make the refusal by the defendant to allow the plaintiff to continue occupying the leased premises an act jure importif I do not think so. The purpose for which the breach is committed cannot alter, its character. The defendant's act of entering into a landlerd/ lessor and tenant/lesses relationship with the plaintiff was in my judgment a non-sovereign<br>act. The fact that the defendant found it necessary for security or other reasons not to have tenants in the building cannot in my opinion convert the non-covereign act into a sovereign act."

In the propert case, the respondent, a diplomatic mission acting on behalf of its foreign government decided to offer for sale its mission property to the appellant, a private individual. It is not clear whether the property was first offered to the Usenda Government as required by the provise to Section 6 of the Diplomatic Property and Concular Conventions Act already referred to. De that as it may, the appellant accepted the offer and the Lras An agreement for sale of the property purchase price paid. (whether contingent or otherwise) was thereby concluded. The rechondent subsequently declined to go ahead with the sale, thus breaching the agreement. The reason for the breach was not disclosed but even if it was, it would not alter the character of the transaction.

It seems to me that the acts of concluding an agreement for sale of the property and the consequent breach of the agreement cannot be said to have been done in exercise of governmental or severeign authority or to have been public acts done under public law. There is no evidence to show that in so acting the respondent performed acts involving the sovereignly of the United Kingdom. Nor can be said, that, to borrow Lord Dennings words in <u>Rahintoola</u>

$\frac{28}{2}$

-2T7-

*\r,* Tizari of Hydorbad (1957) ³ All T.h. 44i at p. 45j, "thc dispute brings into question for instance the legislative or international transaction clicy of its executive." a foreign government or the

It is my opinon that the acts forming the basis of the appellants claim were of The acts might have entered into. The resulting legal relationship was that of vendor and purchaser. The respondent descended into the commercial transaction and therefore should bo subject to the ruJ.es of the \* market place. As it was said in Ohio V. Helvering (l?p4) 292 US at p. Jb?, customer to purchase the property as a were private acts of a private law character such as a private citizen a commercial or trading nature. market place to look for a

> "Y.'}ien a State enters the market place seeking customers it divests itself of its quasi sovereignly pro tanto and takes on the character of a trader."

It is c?ear that the purpose of the restrictive theory is to try to accommodate the interests of individuals doing business of n^o As lord Tilborforce commercial transactions wi with foreign governments by enabling them to bring claims • a commercial or private law nature before municipal cci'.rts. do sc ic neither a threat to the dignity of that State nor any observed in the Cor.^reco case (supra) the restrictive theory interference with its sovereign functions. of immu ⁱ individuals.. lie then rzer.t on to say, arises out of the willingness of States to enter into

> "It appears to have two main foundations. (a) It is necessary in the interest of justice to individuals having such transactions with States to allow them to bring such 4rcireactions before the courts. (b) To require a State to answer a claim based or such transactions does not involve a challenge to or inquifU into any act of sovereignty or governmental act of chat State. It is in accepted phfrases, neither a threat to the dignity of that State nor any interference with its sovereign functions."

Tor the reasons T have iven I would hold that the facts complained of commercial to claim sovereign immunity in this action\* Accordingly the plea of sovereign immunity must in my judgment, fail\* failed to establish that the are within the dermain of • espondont has or private law character and are outside the sphere of public or governmental acts entitling it The second ground of appeal states as follows:

> "The learned presiding judge failed generally to appreciate issues as disclosed in the pleadings ■and ^| a particular failed to appreciate that the appellants' case was that the agreement for the purchase of the suit property was concluded and is binding on the parties and that if such is the case the suit property having been willingly sold to tho. appellant such suit propety and all interest therein belongs to the appellant and cannot bo covered under Articles 22 (3) and 30(1) or under any article of or the whole of the Vienna Convention since the appellant is not a state or a diplomat and since the definition of premises of the mission under the Act does not include sold premises or former premises of the mission"•

The respondent could not enjoy immunity over property which had ilrondy been sold to the appellant. that the appellant had admitted in the pleadings that the suit property was the property of the respondent. 1st of the appellants¹ submission on this ground was tliat the The respondsnts • reply wos

Tt was not seriouly contended that the su⁵ t property was not the property of he respondent at the material time. 7ven if it was otherwise, Therefore find no merit in this ground of anneal\* 1c was the issues whether the property had already been sold o the appellant or whether the aiyreerentof s btxdlny •wore issues pending determination after calling ev-derce.

already been e::crc~ red. round was that the learned trial jua-e erred in sue which right had the remedies sou -ht in this suit could not be executed a..u further The third lu-.v and fact in holding that the decree which could arise out of erred in holdin- that it would be futile to cue not real! that the apfcllant had the ri^ht to t have already considered tnis matter

/jO

have held, reasons already given that the trial judge that it futile to sue for a decree which could not be executed. this ground must succeed. According! dealing with the first ground of appeal. was wrong in holding

j.n the fourth ground of appeal the appellant complains that the learned trial judge failed the principles of the charter of the United hations concerning the sovereign equality of States, the maintenance of international peace and security and the promotion of friendly relations that the trial appreciate that the intendment of the ?'w ie Convention docs not give privileges st?tes to commit crimes to re^c eiving ³ te.tes law*z* or to oppress or cheat ti.e nationaIs of the receivi g State or other nationals receivin'\* state. The appellant complains further residing in the judge failed to among na tions • to appreciate the intendOrient of the Vienna Convention on Diplomatic delations which is based on or licence to the foreign or torts or defy the

Tt is true that the Veinna rea'Mblc to the convention and spelt out by the ^T)O1? States. Pe? atier s ⁱ s Convention on Diploma ^c performsnc? of the functions of diplomatic missions in representing s not to benefit individuals tut to ensure the efficient clearly states that the purpose of the privileges and in^rr/ties the Charter of the Uni.ted Nations as it is declared in the But it is eg; ally true that t¹ e presjrtble to the convention intended to promote the purposes and pri;..cip?es of

was. the trial ju that the respondent had committed any Uganda. On the *'■■J* Therefore it submitted before crime-^r cheated Tt was not claimed in the pleadings involving ^t'-'e intended purchase *J e* ^t J- not see how the trial^can be blamed for not conoid Uganda, or oppressed or yjnS contrary what^at issue ^a of the sv.it property\* torts, or defied the Lews of any national of a dispute

or appropriating issues not reised at the trial and which were irrelevant to the preliminary point raised. I find no monit in this ground of appeal.

The fifth and last eround of emperi states.

WThe learned presiding judge erred in law<br>in failing to address her mind to the provisions<br>of Article 41 of the Diplomatic Privileges Act which provides as follows,

$-$ 2 - 30 - 34

\*I. without prejuduce to the provileges and<br>immunities, it is the duty of all persons enjoying such privileges and muunities to respect the laws and regulations of the receiving State. They also have a duty not to interfere in the internal affairs of that State.'"

I accept Mr. Kateera's submission that Article 41 of the Vienna Convention is not part of the law of Ugenda under the Diplomatic Privileres Act 1965 since it is not given the force of law by Section 1 of that Act which provides,

> "Articles 22, 23, 24 and 27 - 40 of the Vienna Convention shall have the force of law and references therein to the receiving State shall, for this purpose be construed as references to the Sovereign State of Heanda."

Accordingly, the trial judge had no duty to consider those provisions and therefore her failure to do so was immeterial to the ortcome of the preliminary issue.

Secondly, the provisions of Article 44 of the Convention were irrolevant to the preliminary point raised. Although I believe that these provisions codify customary international law and therefore should guide the conduct of diplomatic agents, there was no allegation that the respondent had acted in utter disreprect of the laws of Wrenda or interfered in her internal affairs. The question at issue was a dispute over a communcial transaction inviving an agreement for sale of a mission house to an individual. Whether the respondent had

$\mathcal{L}(\mathcal{L})$

$\cdots$ 32 committed a breach of that agreement was a question to decided during the trial on merits. The preliminary objection had mothing to do with the merits of the case. Therefore it could not be safely concluded at that stage that the respondent was the marty in the wrong or that it had breached any law. For these reasons, this ground of appeal must fail.

$\frac{29}{20} - 31 -$

The respondent filed a cross-appeal on the following ground:

"The learned trial judge erred in law in holding that the British High Commission is a jurisdical person only by reason of the fact that it is registered as a proprietor of the land the subject matter of the <pre>proceedings."</pre>

Mr. Kateera, learned counsel for the respondent submitted that the trial judge misdirected her mind on the issue whether the respondent was a legal person. He pointed out that she held that the respondent could be sued because under Article 3 of the Vienna Convention the respondent represented the sending State and second that under Section 56 of the Registration of Mitles Act, the property in question was registered in the name of the respondent. Learned counsel submitted that the learned trial judge confused the various ways in which a body becomes a legal person. He argued that legal persons are either individuals, componsitions companies or componstion sole.

As regards Aurticle 3 of the Convention Mr. Kateers submitted that it has no force of law in Uganda nor does it Canks componete status on diplomatic mission. With regard to section 56 of the Registration of Mitles Act he summitted that, it does not have the effect of creating legal personality since the Section presupposes that the person registered is a legal person; and the fact that the property is registered in the name of a body does net make it a legal person. Counsel further contended that if the Diplomatic Property and Consular Conventions Act had intended that

$...$ /3

it would have said so. Finally counsel submitted that even if the of the British Government it could not be sued while the principal Moreover, sue a mere office but the Government represented. diplomatic missions should held property, was disclosed. respondent is the agent counsel concluded, one cannot

-

Mr. Kayondc for the apppllan argued, supportⁱ ngtho de c i sion virtue of Article J of the Convention and Section 56 of the Pegistration of Titles Act. of the trial judge, that the respondent was a legal entity by

T accept Mr. Kateera's submission that the trial judge was or Article 3 has no force of law in Uganda although I consider the functions listed thereunder to be the traditional functions of diplomatic be sued. Kingdem. or an agent of the not correct in holding that the respondent could be sued on United Kingdom, it could not bo sued on behalf of the United behalf of the United Kingdom because it was its representative agent, under Article J of the Vienna Convention. missions nor does it in any way, rive tl.etw capacity to sue Accordingly even if the respondent was

As regards Section % of the Pegistration of Titles Act, the learned trial judge said,

> ''Further the court was shown the title deed to the property in issue. Tt was issued in the names of the British High Commission. It is pertinent to refer to Section 56 of the Registration of <Titi.es> Act Cap\* ?0? whi ch provides ft nter ^a ¹ ? a»

and every certificate of title issued under any of the provisions hemin contained shall be- received in all courts as evidence of the particulars therein set forth and 01 the- entry thereof in the Pegister Book -nd shall be conclusive evidence that the ^ex^son named in such certificate ar the proprietor of dr having any estate or interest in or power to appoint or dispose of the lard therein described is seized or possessed of such estate or interest or hrs such po^er.'

An estate in land cannot be fi Perhaps I might point out that in matters affecting title to land it is the registered legal owner who can sue or be sued, held by a non-legal entity.

I agree with the learned trial judge that an estate in land cannot be held by a non-legal entity. Indeed I accept Mr. Kateera'scontention that Section 5& of the Registration of Titles Act presupposes that the proprietor is a legal person, and that the Section itself does not confer legal personality on the registered proprietor who is not otherwise a legal person.

I think it is a well established proposition that in general only legal persons can sue or be sued. Legal persons may be individuals, corporations, corporation soles or companies\* Firms may sue or be sued under certain circumstances. The respondent is heitfrer of these and therefore is not I would not ajuridical person qt does it have any other legal capacity enabling it to be sued. therefore hold that the respondent cannot be sued because it is a legal person\*

In my judgment since the respondent is a branch and therefore an emanation of the Government, of the United Kingdom on whose behalf it is holding the suit property, the action should have been brought against that Government and not the respondent. The action against the respondent was misconceived and not maintanable. It was rightly dismissed.

Mr. Kayondo, counsel for the appellant asked us to order the substitution of the Government of the United Kingdom as defendant to the suit in the event of our holding that the respondent was wrongly sued\*. In my opinion it would be wrong to do so since the application was not made at the lower court where it ought to have been made and considered first\* l£would be improper for us to consider it on appeal\*

/34

I

A

In the result, I would uphold the trial judge's decision dismissing the appellant's action against the respondent and I would accordingly dismiss the appeal with costs, and allow: the cross-appeal with costs#

Dated at Mengo this ODOKI JUSTICE OF APPEAL. day of 1988#

*L*

3^

Odoki JA

# IN THE COURS OF ADDING AT MENGO

(Corax: Manyindo, V/2, Lubogo, Ag. J. A., & Odoki J. A.) CIVIL ARIUM NO. 8 OF 1987

### BETTEEN

EDDIE RODRIGUES APPELLART

$\Lambda$ $\mathbb{N}$ D

THE BRITICH HIGH COM I. I. I. .... **REUPONDENT**

> (Appeal from Ruling and Order of the High Court of Uganda (Bahigeine Ag. J) dated 25th June, 1987)

> > $\mathbf{1} \mathbf{1}$

# CIVIE 10. 10. 100 OF 1987

Judgement of Lubogo Ar. J. A.

I have had the opportunity of reading the judgment of Odoki J. A. in draft and I agree with him in respect to the immunity of the cending state in matters relating to criminal and civil jurisdiction of the recouving state and the exceptions in which immunity cannot be accounted in the international law. On this point several authorities with been cited and I agree with them an persuasivs.

However, one aspect of this appeal has not been commented upon and that is the Title bood itself under which the suit property was acquired by the recondent, the British High Commission. Looking at the Certificate of Title the following facts emerge. It is a leasehold comprised in Lenschold Register Vol. 589 Folio 10, Plot 17 Frincess Ande Drive, Bugolobi. The proprietors on 19th September, 1972, before the latesty's Government came into the picture, were Reginald John - Cwith and Francis Valley. This joint proprietorship was calcolled. On 11th January, 1973 Her Majesty's Government in United Kingdom lodged a caveat on the Certificate of Title. On Jan May, 1985 the British High Commission became the proprietor of the mult property. The appellant Eddie Redrigues lodged a caveat on the property on 6th February, 1936. Then on 11th November, 1906 The British Righ Commission lodged a casent on the same property. It is quite clear from the Certificate of Title that the British Migh Commission is the sole proprietor of the suit property in space of the fact that Her Majesty's Government in the United Mingdom has still a caveat on the property. The acquaition of the property, therefore, by the Eritish High Commission had the blessing of Her Majesty's Government in the

United Kingdom otherwise I curred see how the British High Commission came to acquire the property. Wittingly or unwittingly the British High Commission has come within the provisions of the Registration of the Titles Rot.

Section 56 of the Registration of Titles Act reads:-

$\overline{2}$

$\mathcal{A}$ .

" No certificate of vible issued upon an application to bring land under this hot shall be impeached or defeasible by roamen or an account of any informality or irregularity in the application or in the proceedings previous to the registration of the certificate, and and every certific to of title insued under any of the provisions herein omitated shall be received in all courts as evidence of the posticulars therein set forth and of the entry danced in the Register Book, and shall be conclusive dvidence that the person named in such certificate as the proprietor of or having an estate or interest in or newer to appoint or dispose of the land therein decorded is seized or possessed of such -estate or interest or has such power".

An I said before the Drittish Migh Commission was registered as the proprietor on 3rd May, 2009, the transaction to sell the suit property must have been done in between that date mentioned above and 6th February, 1906 on with a caveat was lodged by the appollant, Eddie Rodrigues. During that intervening period the British High Commission had power to amplied or dispose of the land therein under the prevision of contains 56 of the Registration of Titles without reference to any other person or authority. The appellant, therefore, having been annived of the legal position paid a sum of She. 85,000,000/m for the involues of the suit property on 13th November, 1935. A receipt was issued to him accordingly. Annexare "B".) This transaction was conserved to all intents and purposes. The provisions of Section 🐋 👓 the Registration of Titles Act do not give an exception to any purson whether diplomat or not from its operation. However, as my brother Odoki J. A. has pointed out in his judgment that Section 6(4) of the Diplomatic Property Counsular Conventions Act provides that every Commonwealth country would be a body corporate in remaind to holding land. Since the British High Commission is not a body corporate could not hold land and if it did it would le in contravention of the provisions of the Diplomatic Property & Counsular Conventions Act.

With regard to the amon-appeal by the respondent I seem to agree with Fr. Kateera the learned counsel for the respondent that the respondent cannot be said as a representative of the Government in the United Mingdom.

$3$ .../Phe

$\mathbb{S}$ mufor<br>dissuis and allow to crosscapped appeal I would the The appeal dismissed with costs. The sexpondent. cests of the costs of the cross-end $\overline{u}$

Delivered this.................................... at Mengo.

eroticle L. K. Luboro $v$ id $\mathbb{R}_{\mathbb{Z}}$ Justice of Appeal.

### IN THE COURT OF ALLEAL

#### MENGO $\Lambda\mathbb{T}$

(CORAM: MANYINDO V-P, LUBOGO AG. J. A.., & ODOMI J. A.)

# CIVIL APPEAL NO. 8 OF 1997

**BITUESN**

EDDIE RODRIGUES ::::::::::::::::::::: APPELLANT

### AND

# THE BRITISH HIGH CONNIESION ::::::::: RESPONDENT

(Appeal from Ruling and Order of the High Court of Uganda (Bahigaine Ag. J.) dated 25th June 1987

in

Civil Suit No. 100 of 1087)

# JUDGMENT OF MANYINDO V-P:

draft and I gos appeal. I read the judgment of Odo': agree with it entirely the question whether the respondent was a legal person capable of suing and being sued was made an issue and, therefore, the learned trial Judge ought to have decided that issue one way or the other.

The ratio decidendi of inter alia, the cases of (1) Alcon Ibd v Republic of Colombia (1984) I AII E. R. I (CA) (2) Trendex Trading Co. v Central Bank of Nigeria (1977) I AII. J. R. 881; (3) Phillipine Admiral (owners) v Tallen Shipping (Hong Mong Ltd (1976) I AII. S. R. 78 is that if a Government or one of its departments or branches goes into the market places of the world and engages in straight forward commercial transactions then it is completely within the territorial jurisdiction of the courts of the foreign sovereign. Sovereign immunity cannot be claimed in respect of such transactions.

$-.12$

This point was net argued in the lower court, it was argued before us, we are entitled to decide it. I agree with Odoki J. A. that the courts of this country should have jurisdiction in cases where the immunity is restricted. The. case before us is clearly one of them.

In this case Her Majesty's Government is not a party to the proceedings. However, it claims an interest in the suit property and, contended Counsel for the respondent, that Iler Majesty's Government is therefore indirectly impleaded. I think it is settled lav; that even in such case that mere claim cannot bar the .jurisdiction of the court except in such cases as ships of war or other public property belonging to the state, see: The Christina (1938) I ATI. ~. R. 719 (H. C.) and Haile Classic. 19J8 Ch. 859 As was pointed out by Goddard ^r .e. in frantzazu I.'endi (1959) T. L. R. ?1, the claim will stand even if there are competing rights over the property.

As this was a ccmmorcial transaction, the Ili^h Court would have jurisdiction provided the correct parties were sued. As Lubogo Ag. J. A. also agrees, this appeal is dismissed with costs to the repondent. The cross appeal is allowed, again wita cos

Dated at I.'engo this day of -1W.

S. T. KANYIYDO Vice - President/Court of Appeal.

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