P L D 1968 Karachi 443 (PLP)

The contrary view is that whatever is not contained in sections 84 to 87‑A is to be borrowed from International Law and enforced. In other words, C. P. C. is not exhaustive in respect of the institution of suits by and against foreign Rulers and their States. Five cases have come to my notice in which this aspect has been directly examined. They are:‑ (1) Mirza Akbar v. United Arab Republic A I R 1960 Cal. (2) United Arab Republic v. Mirza Ali A I R 1962 Cal. 387, . (3) Ali Akbar v. United Arab Republic A I R 1965 S C 230. (4) R N. Airline Corporation v. Monorama A I R 1966 Cal. 319, and (5) Gammon‑Layton v. Secretary of State, U. S. A. P L D 1965 Kar. 425.

19. The first decision is by a Single Judge who decided the case on the Original Side of the High Court of Calcutta. It was a suit by an individual against the United Arab Republic. The suit was decreed. It was held that section 86, C. P. C., bars the institution of suits without the consent of the Central Government against Rulers of foreign States, and not against foreign States themselves. The learned Judge observed that section 87, C. P. C. does state that the Ruler of a foreign State may sue and be sued in the name of his State, but in India, section 87‑A defines "Foreign State" and "Ruler" separately, which means that they are different entities; therefore, a suit against a Ruler does not become a suit against his State merely because it is instituted in the name of the State. Section 87 A of India runs as follows: "

87. A Sovereign Prince or Ruling Chief may sue, and shall be sued, in the name of his State: Provided that in giving the consent referred to‑in the foregoing section the Central Government, or the State Government, as the case may be, may direct that any such Prince or Chief shall be sued in the name of an agent or in any other name." The learned Judge, therefore, applied International Law and held that‑

"there is no principle of absolute immunity" in it. He further held that the subject‑matter of the suit being of commercial natures, it did not attract the rule of immunity. Moreover, he found that the defendant" had submitted to the jurisdiction of that Court. He decreed the suit.

20. The defendant went in appeal, which was decided by a Division Bench of the High Court. That judgment is mentioned at No. (2) above. The Division Bench agreed with the inter pretation of the provisions of C. P. C., but accepted the appeal and dismissed the suit on the ground that the High Court of Calcutta had adopted the relevant rule of English law as the rule of private International Law applicable to India and that accord ing to that rule, the immunity of a foreign State was absolute.

21. The plaintiff preferred ad appeal to the Supreme Court of India which has dismissed it but has held, overruling the view of the lower courts, that C. P. C. barred the suit. Its judgment is mentioned above at No. (3). The Court has stated that two main questions were before it for decision :‑‑ "the first is in relation to the application of section 86 of the Code; and the second in regard to the scope and effect of the doctrine of immunity under International Law." It has taken the view that section 86, C. P. C., conditionally bars a suit against a foreign State, and that the section being a statutory provision, prevails in competition with International Law; there fore, concluded that it was unnecessary to deal with the question of immunity under International Law. The Court has set out five reasons for coming to the conclusion that section 86, C. P. C. bars a suit which is instituted without the consent of the Central Government against a foreign State, as follows :‑ (i) It is not permissible to draw a sharp distinction between the Ruler of a foreign State and his State. This is inferable from the fact that sections 83 to 87‑A are grouped under the heading "Suits by Aliens and by or against Foreign Rulers, Ambassadors and Envoys"; yet section 84 empowers a foreign State to sue and section 86 makes the Ruler of a foreign State liable to be sued with the consent of the Central Government. This context diffuses the distinction. The effect of section 87 is also the same. It makes it necessary that, when a Ruler is to be sued under section 86, or when he himself sues, the suit has to be in the name of his State. (ii) The proviso to section 84 requires that the object of every suit under that section must be "to enforce a private right vested in the Ruler of such (foreign) State or in any officer of such (foreign) State in his public capacity"; that is to say, it must be a private right as distinguished from a political right, but not a personal right as distinguished from the right of the State; in other words, the private rights mentioned in this section do not mean individual rights as opposed to those of the body politic. Moreover, they must be such rights of the State as are enforceable in a Municipal Court of Justice as distingu ished from political or territorial rights which are beyond the jurisdiction of such courts. This proviso obliterates the distinc tion between a foreign State and the Ruler of that State because the subject‑matter of the suit can be the rights of the State, whether, vested in the Ruler or in an officer, and not the personal rights of the Ruler, (iii) Section 87‑A of the Indian Code defines a foreign State and a Ruler separately. The Ruler under It means :‑ "the person who is for the time being recognised by the Central Government to be the head of that (foreign) State." 'The effect is that the expression 'Ruler' means tae head of a foreign State whether he happens to be a monarch or a President or any body else. This definition clarifies a possible doubt that the expression 'Ruler of a foreign State' used in section 86 refers to a monarch. It refers to the head of a foreign State however designated and however constituted. In other words, according to this definition, there is no essential difference between the Ruler of a foreign State and his State for purposes of this group of sections. (iv) Even the Division Bench of the Calcutta High Court interpreted the words "Ruler of a foreign State", in contra distinction to "foreign State", had to concede that there can be no distinction between these two expressions when they are applied to monarchical foreign States, because in such States the Rulers are themselves the States. In other words, the Division Bench found it necessary to draw a distinction between monarchical and republican foreign States to justify the distinction, but such a distinction has no basis because the procedural law is meant to apply to all types of States and the definition of the word "Ruler" given in section 87‑A positively makes it applicable to all heads of foreign States irrespective of their constitution. It is, therefore, in harmony with this pattern of law that the expression "Ruler of a foreign State", which occurs in section 86, should be interpreted to apply to all heads of foreign States without the distinction of monarchical and republican constitutions. (v) It is no anomaly that section 86 confers immunity which is different from that which is recognised by International Law. The explanation is as follows :‑ "Just as an independent sovereign State may statutory provide for its own rights and liabilities to sue and be sued (within its own territory) so can it provide for the rights and liabilities of foreign States to sue and be sued in its Municipal courts. That being so, it would be legitimate to hold that the effect of section 86(L) is to modify to a certain extent the doctrine of immunity recognised by International Law. This section provides that foreign States can be sued within the Municipal Courts of India with the consent of the Central Government and when such consent is granted as required by section 86(1), it would not be open to a foreign State to rely on the doctrine of immunity under International Law, because the Municipal Courts in India would be bound by the statutory provisions such as those contained in the Code of Civil Procedure."

23. The fourth case to which reference has been made above is also an Indian decision of the Calcutta High Court. In that case the defendant was "The Royal Nepal Airline Corporation" and another. The Ambassador of the King of Nepal, though not a party to the suit: made an application stud claimed immunity. It was held that he could do so because the Airline Corporation was a department of the Government of Nepal and as such entitled to claim immunity from the processes of Indian courts.

24. The law in India is thus settled by the pronouncement of the Supreme Court of that country. According to it, a suit against a foreign State cannot be instituted without the consent of the Central Government in term: of section 86, C. P. C.

25. But the contrary view has been taken in the judgment, which is mentioned at No. (5) above. It has been expressed by a learned Single Judge of this Court in a suit instituted by Messrs Gammon‑Layton v. Secretary of State for the United States of America in 1965. The view which has prevailed in those proceedings is again that section 86, C. P. C.. confers partial immunity on Rulers of foreign States, but not on foreign States themselves. Foreign States have been held to be juristic persons and capable of being sued, and therefore, incapable of being identified with their Rulers as one and the same entity. The learned Judge has observed as follows: "It (a foreign State) is a juristic entity and it may sue and be sued in its own name. Thus a Ruler of a foreign State cannot be identified with the foreign State of which he is the Ruler. (They are two separate entities). It may be argued that a suit against a foreign State is really a suit against its Ruler. Section 87, C. P. C., lays down that a Ruler of a foreign State should be sued in the name of his State. This (however) does not mean that the suit, which is in the form of a suit against a State, is necessarily a suit against its Ruler. It (section 87, C. P. C.) only prescribes the form of a suit against the Ruler, i.e., he must be sued in the name of his State or of an agent or in any other name. It does not necessarily mean that this suit is against the State." The learned Judge has found support in the law of India, as it was before the judgment of its Supreme Court, to his view that section 86, C. P. C. does not bar suits against foreign State. He has stated the Indian law to be that :‑-- "Indian Courts have held that section 86, C. P. C., does not allow immunity to foreign States though they are allowed to, or are exempted from the Civil Process of Courts under the general principles of International Law which has been adopted as part of Municipal Law in that country." Now the Indian interpretation is different from the view taken by the learned Judge. Proceeding further he has held that International Law confers immunity on foreign States, but has found it to be ineffective because C. P. C. excludes the applica tion of that law. He has explained this point of view as follows :‑ "By International Law a State cannot be sued in the Courts of another State but the Municipal Law of different States differs considerably in giving effect to this broad rule. If the rule of International Law laid down in the case : Duff Development Co. Ltd. v. Kelantan Government and another (1924) All E R 1 were held applicable to the facts of the' present matter, I would have been constrained to hold then present proceedings bad. But this attempt on my part would not be justified, i e., to engraft upon the propositions of Civil Procedure Code general principles of International Law which our Legislature did not think it proper to do so. No judgment of any Court in this country has been brought to my notice in support of the defendant's case." . He has then pointed out that the tendency of even the States of the modern world is to abandon the rule of absolute immunity in respect of foreign States, and has held the suit against the Secretary of State for the U. S. A. to be maintainable.

26. The gist of the above reasoning is that a foreign State is not immune from being sued in this country because :‑ (a) Section 86, C. P. C. does not bar a suit against a foreign State. It conditionally bars suits against foreign Rulers only. A foreign State and its Ruler are two separate persons, and cannot be treated one entity. A foreign State is, therefore, a different entity which should not be confused with its Ruler. (b) Section 87 merely prescribes a form and does not obliterate the separate existence of a Ruler as distinguished from his State. (c) C. P. C. is the paramount law of the land which cannot be modified by International Law. Moreover, the Private International Law of various countries of the world is not uniform on the question of immunity to foreign States and the general tendency is to abandon the principle of immunity in respect of business transactions. I have no quarrel with either part of the third proposition in these proceedings. The second proposition is not of decisive importance because if the Ruler of a foreign State and his State are separate persons, then the "style", to use the language employed in the marginal note to section 87 C. P. C., by virtue of which Rulers are required to institute suits n the names of their States will not necessarily affect their separate existence.

27. The first is its only important proposition for the present purposes. Let me analyse it. It is true that the Ruler of s foreign State should be a "person" because he is ordinarily expected to be a natural person, but why has a "foreign State" been presumed to be a "person"? To appreciate this, let us have another look at the second proviso to subsection (1) of section 84 of our C. P. C. and compare it with subsection (1) of section 85, C. P. C., section 84 (1) is as under :‑

"A foreign State may sue in any Court, in the Provinces: Provided that such State has been recognised by the Central Government Provided also, that the object of, the suit is to enforce a, private right vested in the head of such State or in any officer of such State in his public capacity." The only provision in C P. C. which authorises a foreign State to sue is the above one and the words underlined by me show that the object of the suit cannot be a right vested in the plaintiff State, but must be one that is vested in the head, or an officer, of such State in his public capacity. This proves that the plaintiff State and the head or other officer of such State arc not different entities. Moreover, it is significant that the right which is the object of the suit cannot be one that vests in the State. It must vest in the head or an officer of such State. The above subsection, read with subsection (1) of section 85, further indicates that a foreign State that is authorised to sue does not and cannot act by itself. It is the Ruler of that State who is expected to act for the State. This is why the Central Government appoints an agent to prosecute the suit at the request of the Ruler, and not at the request of the plaintiff ‑State. See below subsection (1) of section 85, C. P. C. :‑

"Persons specially appointed by order of the Central Government at the request of the Ruler of any foreign State . . . . . to act on behalf of such Ruler to prosecute . . . . . any suit on his behalf shall be deemed to be the recognised agents . . . , .". The words underlined by me may be noticed. They make it clear that the foreign State which sues is not different from its Ruler. On the contrary, it is reasonable to conclude that the Ruler or the head of the State, and not the State, are treated‑ as the active or living parts of the body politic.

28. What is the significance of this legal treatment of the subject? Why has the "foreign State" that sues under section 84(1) been substituted in section 85(1) by the Ruler of such State for making a request to the Central Government? Why cannot any right vested in the State be the object of a suit that a foreign State is authorised to institute under section 81(1) ? The answer is that the underlying principle of these provisions is that a "foreign State" as such is not a legal person ; therefore, it is not supposed to have any right vested in it nor to be capable of making a request. This is curiously the orthodox view of English jurisprudence. The English mind feels uneasy and even refuses to conceive of a government which is not monarchical. Lt is so, not only when an Englishman thinks of his own country, but also when he thinks of other countries. This sounds strange to a jurist whose temperament is not imbued with English traditional feelings. This is why Indian and Pakistan Judges have not considered sections 84 to 87‑A, in the above‑mentioned five cases, from this point of view. But to a Division Bench consisting of English Judges they presented no problem for arriving at the conclusion that a foreign State cannot be sued at all‑See Gibnore v. State of Travancore. Let me explain the English point of view with the help of an old English judgment and the observations contained in a recent edition of a well‑known English treatise on jurisprudence.

29. The status of a Republican Government was analysed to an interesting case in United States of America v. Wagner (L R (1866/67) 2 C H A 585). In that case, the United States of America filed a suit against the defendant for rendition of account and recovery of whatever may be found due in consequence. The suit was resisted by the defendant on the ground that the United States of America could not institute the suit, though the President of the United States, or some other officer could do so. The objection was upheld and the suit was dismissed. The United States of America went in appeal. In the appeal the defendant‑respondent relied on two previous English decisions given in Colombian Government v. Rothschild (1 Sim. 94) and the President of the United States of America v. Drummond (34 Beav. 449) The points of view which were discussed in those judgments are Interesting because they reveal the English treed of thought. But I omit to refer to them because the observations which arc contained in the appellate judgment in which reliance was placed on them are themselves revealing.

30. Three Judges heard the appeal and wrote separate judgments. They unanimously accepted the appeal. Their observations show how the lawyers were thinking and how they had to resist those trends in the interest of international amity. Lord Chelmsford, L. C. has observed that: "The argument before us in support of the demurrer (defendant‑respondent) has been chiefly rested upon the case of the Colombian Government v. Rothschild, and it has gone to the length of maintaining that, by the rules of procedure in Chancery, a foreign republic is unable to institute a suit for the recovery of its own property in its own name. And being pressed to state in what manner the United States of America are to sue in. our Courts, the counsel for the defendants said the only proper mode was in the name of their President" The answer that the President could sue was not consistent with the trend of the argument, because one of the arguments was that the President and the Government of the United States were not one entity. It was in the words of Lord Chancellor :‑-- "expressly stated that the selection of the President as a defendant in the cross bill was open to the objection that the Court could not take judicial notice, nor did he suppose it to be a matter of fact, that the United States Government have control over their President, or can compel 'him to produce papers, or the like . . . ." . The underlying idea appears to be that public rights and interests could vest in a natural person only, and not in a Republic. Lord Chelmsford had to resist that trend as follows :‑ "But if the President is not the proper person to sue on behalf of the United States, what other mode of prosecuting their rights in a foreign country than by suing in their own name, can be resorted to ? I confess I have been unable to appreciate the distinction which ran through the whole of the defendant's argument, between a suit ice equity by the head of a monarchy, and a similar suit by a republican State. In a monarchy all the public rights and interests of the nation are vested in, and represented by, the monarch. In a republic they are the property of the state . . . . Why should a republic be ‑ precluded front asserting in its own name, similar rights vested in it?"` Sir G. J. Turner, L. J., has observed as follows:‑

"In my opinion, also, this demurrer ought to have been overruled. The, right of a foreign state which has been recognised by Her Majesty, whether it be a monarchy or a republic, to sue in the Courts of this country for public property belonging to the State, has not been, and cannot be, denied. The emphasis is on the recognition of a republican State by her Majesty. With that weapon he cuts the Gordian knot.

31. Lord Cairns, L. J., has also reviewed the argument of the defendant‑respondent. Referring to the case of the Colombian Government he has restated the argument of Sir John Leach, who had decided that case, as follows:‑

"Dealing with the words before him, Sir John Leach appears to me to have held, and to have most properly held, that an unknown and undefined body, such as the government of a state, could not sue by that quasi‑corporate name, and the expressions to his judgment seem to me to intimate no more than that if the persons so described could sue at all they must come forward as individuals, and show that they were entitled to represent their State:" He has dealt with the argument which was placed before him by pointing out, firstly, that it was contended that the United States of America; "being a republic, cannot sue in its own name, and must either associate with it as plaintiff, or proceed in the name of, the President of the Republic, or some other officer of State." and found fault with it by pointing out that ‑it amounted to disregarding the status of the real owner of the subject‑matter of the suit, to which the reply as given at the bar was that :‑ "When a monarch sues in our Courts, he sues as the represen tative of the state of which he is the sovereign"; therefore, if the property in dispute . "belongs to a republic, the head of the executive, or in other words the President. ought to sue for it." He has repelled the last argument as follows :‑ --. "This argument, in my opinion, is found on a fallacy. The sovereign, in a monarchical form of government, may, as between himself and his subjects, be a trustee for the latter, more or less limited in his powers over the property which he seeks to recover. But in the Courts of Her Majesty, as in diplomatic intercourse with the government of Her Majesty, it is the sovereign, and not the State, or the subjects of the sovereign, that is recognised".

32. The above discussion of the problem is enlightening. It shows in what difficulties the English legal thought found itself when confronted with the claim of the United States of America to institute a suit in an English Court. It was a practical problem before the Courts and was solved as such. But the deeper problem is psychological. We find a reliable and learned exposition A it at pages 321-24 in the latest edition (1966) of Salmond's book on Jurisprudence. He says: "Of all forms of human society the greatest is the state . . . . Is it, then, recognised by the law as a person? Is the commonwealth a body politic and corporate, endowed with legal personality, and having as its members all those who owe allegiance to it and are entitled to its protection? This is the conclusion to which a developed' system of law might‑be expected to attain. But the law of England has chosen another way. The community of the realm is an organised society, but it is no person or body corporate. It owns no property, is capable of no acts, and has no rights nor any liabilities imputed to it by the law. Whatever is said to the contrary is figure of speech, and not the literal language of our law. How, then, are we to account for this failure of the law to make so obvious and useful an application of the conception of incorporation and legal personality? Why has it failed to recognise and express in this way the unity and permanence of the State? The explanation is to be found in the existence of monarchical Government . . . . . It is true that modern times have seen the growth of many exceptions to these principles. Local authorities are public bodies, (But) In so far as the English lawyer thinks of the state as a whole, he expresses his thought by speaking of the King."

33. In my humble opinion, the above understanding of the psychology of English jurisprudence is the key to the correct appreciation of sections 84 to 87‑A of the Code of Civil Procedure, 1908. There was no equivalent to sections 84, 86 and 87 in the Codes of 1859, 1861 and 1877. In 1882, for the first time, clause (b) of section 431 and sections 433 and 434 were introduced. They corresponded to sections. 84, 86 and 87 respectively of the current Code. At that tune the English juristic thought had advanced to the point of recognizing as a practical proposition, the right of a foreign State to institute suits in England, but it dial not amount to attributing legal personality to the State. The stage has not arrived as yet. As against this, there are, and have been, provisions in the C: P. C. from 1877 onwards making it a condition that only legal persons can sue and be sued. Ste Order 1, rules 1 and 3 of the C. P: C. of 1908 and sections 26 and 28 of the C. P. C. of 1877 and 1882. To meet this situation, it was provided in clause (b) of section 431 of 'the C. P. C. of 1882 and section 84 of the current C. P. C. that a foreign State could sue provided it had been recognised by the Central Government and the object of the suit was to enforce a right vested in the head or an officer of such State in his public capacity and as private,, as distinguished from political. This was a practical solution of a problem that confronted the Municipal Courts by reason of comity of nations. It did not mars any chance in the juristic thought. The device solved the problem from the point of view of Institution of suits by foreign States. No corresponding provision was made in section 433 of the Code of 1882, and id section 86 of the current Code of 1908, because there was no such problem with respect to the institution of suits against foreign States its Municipal Courts. A suit, therefore, cannot be filed against a foreign State; and must be filed against the Ruler of such State with the consent of the Central Government.

34. Let me, m. a digression here in order to remove a doom which is often created by taking the word "Ruler" to mean "monarch". This is not correct. The New English Dictionary of Oxford, which is in 10 Volumes (1914 Eda.) give the meaning of the word to be:‑-- "(1) One who, or that which, exercises rule, command, of authority especially of a supreme or sovereign kind ; (2) One who has control, management, or headship within some limited sphere. 1511‑2 Act 3 Hen. VIII. C. 3‑1 ; The father, governors and rulers of such as he of tender age. 1526 Tindale Mark v. 22 There cam vnto hvm won of the rulers of the sinagogge. 1555 Act 2 and 3 Phil. and Mary c. 7‑2 the said Ruler or Keeper of, the said Fair or Market. 1766 Ann. Reg. 134 The Rulers of the watermens company attended. 1864 Reader 21 May 652/1 The rulers of the British Museum are an irresponsible corporation."

35. The Legislature of India has simplified the problem by defining the word "Ruler" in relation to a foreign State to mean: "the person who is for the time being recognised by the Central Government to be the head of that State." This definition has been emphasised by the Supreme Court of India in its judgment of 1965, to which reference has been made above. The appearance of a contrast owing to the expressions "foreign 'State" and its "Ruler", used in sections 84 and 86, C. P. C., is minimised by the uniformity of terminology introduced by section 434 of the C. P. C. of 1882 and section 87 of the C. P. C. of 1908.

36. Reverting to the main discussion let me hope that the foregoing explanations are enough to expose the hollowness of the argument that an anomaly has been created by the expression "foreign State" used in section 84 and the expression "Ruler of a foreign State" used in section 86, C. P. C. The law correctly expresses the English juristic thought that a State is not a juristic person nor capable' of suing or being sued, but that a "foreign State" should be allowed to sue in order to meet a practical exigency arising from comity of nations.

37. The overall conclusion, in my humble opinion, therefore, cannot be that a foreign State can sue or be sued as a juristic "person" in terms of rules 1 and 3 of Order I, C. P. C.; but that ft may sue by virtue of section 84 but cannot be sued 2s such apart from its Ruler in terms of section 86, C. P. C. This suit is, therefore, not maintainable against defendant No. 1, which is a foreign State, nor against defendant No. 2, which is an integral part of defendant No, 1 and of its Embassy in Pakistan. Only the Ruler of a foreign State can be sued, in the name of his State, with the consent of the Central Government. In this case, the Central Government has admittedly given no such consent.

38. The suit is, therefore, dismissed with cost. A. E./K. B. A. Suit dismissed.