January 18, 2019

General Dynamics UK Ltd v State of Libya: Service of proceedings upon a foreign state

Males LJ decides that there must be service where a party is seeking to enforce an arbitration award against a state

Service of court proceedings on states is governed by section 12 of the State Immunity Act 1978. This provides that "Any writ or other document required to be served for instituting proceedings against a State shall be served by being transmitted through the Foreign & Commonwealth Office to the Ministry of Foreign Affairs of the State".

In this case, the claimant obtained an arbitration award against the State of Libya and sought to enforce it by court proceedings in England. It sought to argue that section 12 did not apply in this situation because arbitration enforcement proceedings are instituted by the issue of an arbitration claim form, which is not required to be served, and that the order granting permission to enforce the award (which does have to be served) is not the document instituting proceedings.

That argument has been rejected by Males LJ. He held that "It is at least a reasonable inference that the section contemplates that there will always be some document required to be served for instituting proceedings against a state, and that the purpose of these introductory words is to make clear that service through the Foreign & Commonwealth Office is necessary whatever the nature of the document". Such service is essential in every case where the English court is to exercise jurisdiction over a foreign state.

The judge went on to hold that the document which must be served under the CPR (ie the order granting permission to enforce) must be regarded as the document instituting proceedings for the purpose of section 12, on the basis that it is this document by which the proceedings are formally notified to the defendant and by which the court invokes its jurisdiction over the defendant.

Following a review of earlier caselaw, Males LJ also concluded that the court has no power to dispense with service in this sort of case, as that would be contrary to the mandatory wording of section 12 (and insofar as earlier cases have held otherwise, he declined to follow them). However, had he had power to dispense with service, he would have done so given the "exceptional circumstances" of this case (in view of the civil unrest in the country at the time).