Evidence and Burden of Proof in Foreign Sovereign Immunity Litigation: A Guide for International Lawyers and Government Counsel (6)


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Publication Table of Contents


Contents

Introduction
Foreign Sovereign Immunity in India
Foreign Sovereign Immunity in Pakistan
The State Immunity Ordinance, 1981


Introduction

A brief introduction into the historical development of sovereign immunity in India and Pakistan is indispensable for understanding the burden of proof under Pakistan’s State Immunity Ordinance 1981 because it forms part of a larger body of law, the Civil Procedure Code (C.P.C.) of 1908.

The code was first elaborated for British India in 1908 and later was adopted by Pakistan, after its independence, and based upon the Indian Independence Act, July 1947. Pakistan then drafted a constitution on 23rd of March 1965 through the Central Laws Ordinance (Statute Reform).

— See The Statesman Yearbook, 119th ed. 1982–83, 948, The Far East and Australia, 1983–84 (1983), 724, Harihar Prasad Dubey, The Judicial Systems of India (1968), 287 ff., The Pakistan Code, Vol. V (1880–1910), Section 1, p. 11, note 1.

Not only for historical reasons do we need to consider also the antecedent codes of 1882, 1877 and 1859.

— The analogous provisions are reproduced in part in a synopsis, with those of the C.P.C. 1908, in the decision of the Supreme Court of Pakistan in Qureshi v. Union of Soviet Socialist Republics, PLD 1981, 1, Supreme Court, 377, 409, 413. The decision is also reproduced in 64 ILR 585 (1983) and in 20 ILM 1060 (1981) where the synopsis is to be found on pp. 1076–1078.

Immunity for foreign sovereigns and states under these various statutes merits a brief examination, as the juridical reality today in Pakistan in matters of foreign sovereign immunity, can only be understood through the legislative development of sovereign immunity in both India and Pakistan.

The Supreme Court of Pakistan, in the important and remarkable leading case Qureshi v. Union v. Union of Soviet Socialist Republics, PLD SC 408–418, §§36–47, 20 ILM 1060, 1076–1081 (1981) of July 8, 1981, has proceeded alike, and carefully perused the legislative development of sovereign immunity in Pakistan.

The pertinent provisions in the C.P.C. of 1908 state:

Civil Procedure Code of Pakistan, 1908 (C.P.C. 1908)

Section 9.

The Courts shall (subject to the provisions herein contained) have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred.

Explanation. A suit in which the right of property or to an office is contested is a suit of a civil nature, notwithstanding that such right may depend entirely on the decision of questions as to religious rites or ceremonies.

— This section is valid both for India and Pakistan. See, for India, Sanjiva Row’s Code of Civil Procedure (Act V of 1908) (1962), p. 38, Sarkar on Civil Procedure (1979), 17, Jagdish Lal, Code of Civil Procedure (1981), 9. For Pakistan, see The Pakistan Code, pp. 15, 16.

Section 84. When foreign states may sue.

A foreign State may sue in any Court of British India:
Provided that such State has been recognized by His Majesty or by the Governor-General-in-Council.

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.

— Original version. Reproduced in Qureshi, PLD SC 409, 20 ILM 1060, 1076 (1981). The version in the Pakistan Code, the official record of all Pakistani laws, takes into considerations the modifications, such as ‘British India’ being replaced by ‘in the provinces’ through the Adaptation of the Central Acts and Ordinances Order, 1949, and ‘the Governor-General-in-Council’ being replaced by ‘the Central Government’ through the Adaptation of Indian Laws Order (Government of India), 1937.

Section 86. Suits against Princes, Chiefs, Ambassadors and Envoys. (1) Any such Prince or Chief, and any Ambassador or Envoy of a foreign State, may, with the consent of the Governor-General-in-Council certified by the signature of a Secretary to the Government of India, but not without such consent, be sued in any competent Court.
(2) Such consent may be given with respect to a specified suit or to several specified suits, or with respect to all suits of a specified class of suits, the Court in which the Prince, Chief, Ambassador or Envoy may be sued; but it shall not be given unless it appears to the Government that the Prince, Chief, Ambassador or Envoy —
(a) has instituted a suit in the Court against the person desiring to sue him, or
(b) is in possession of immovable property situated within those limits and is to be sued with reference to such property or for money charged thereon.
(3) No such Prince, Chief, Ambassador or Envoy shall be arrested under this Code, and, except with the consent of the Governor-General-in-Council certified as aforesaid, no decree shall be executed against the property of any such Prince, Chief, Ambassador or Enjoy.
(4) The Governor-General-in-Council may, by notification in the Gazette of India, authorize a Local Government and any Secretary to that Government to exercise with respect to any Prince, Chief, Ambassador or Envoy named in the notification, the functions assigned by the foregoing subsections to the Governor-General-in-Council and a Secretary to the Government of India, respectively.
(5) A person may, as a tenant of immovable property, sue, without such consent as is mentioned in this section, a Prince, Chief, Ambassador or Envoy from whom he holds or claims to hold the property.

— Original Version, equally reproduced in Qureshi, PLD SC 411–412, 20 ILM 1060, 1077–1078 (1981). For Pakistan, see The Pakistan Code, pp. 53, 54. ‘Prince or Chief’ was replaced by ‘Ruler of a foreign State’ through Ordinance 22 of 1960, ‘with consent of the Governor-General-in-Council … of India’ was replaced by ‘with consent of the Central Government,’ certified by the signature of a secretary to that Government’ through the Adaptation of the Central Acts and Ordinances Order of 1949. Sections 86 and 87 of the C.P.C. were replaced by the State Immunity Ordinance 1981 (section 19), 5 PLD 238 (1981), UN-MAT., pp. 20 ff., Gamal Moursi Badr, State Immunity (1984), Appendix V, with effect of 11 March 1981, see also section 1(3) of the Ordinance in the Gazette of Pakistan, Extraordinary Part I, of 11 March 1981. For India, there is an important modification to note. Through the C.P.C. Amendment Act 104 of 1976, the notion ‘Ruler of a foreign State’ was replaced by ‘foreign State.’ This modification is not only of an editorial nature.

Section 9 C.P.C., valid for both India and Pakistan, gives rise to a more detailed exam and must be seen together with the provisions of the code that are relating to foreign sovereign immunity, §§84 to 86 C.P.C. Section 9 C.P.C. states the fundamental principle that civil courts have competence, as a general rule, except such competence is explicitly or implicitly barred.

Sanjiva Row’s Code of Civil Procedure (Act V of 1908) (1962), 38, 39: ‘The section recognizes the maxim ‘ubi jus ibi remedium.’ Any person whose right is infringed, and who has a grievance of a civil nature, has, independently of any statute, a right to institute a suit, unless its cognizance is expressly or impliedly barred.’

Competence is thus stated as the rule, and sovereign immunity as the exception.

Before we will derive any conclusions from this schema for the allocation of the burden of proof, we need to have a closer look what competence or jurisdiction means under this section. The commentary of Sanjiva Row interprets this section as follows.

It means the legal authority to administer justice with reference to — (a) the subject matter of the suit; (b) the local limits of the jurisdiction of the court; (c) the pecuniary limits of the jurisdiction of the Court, and (d) the person sued.

As to (d), the commentary explains: ‘… foreign rulers, ambassadors and envoys can be sued only with the consent of the Central Government; …’ (Id., 41). This means that immunity for foreign sovereigns or foreign states, represents an obstacle, or an exception to the general jurisdiction stated in section 9 C.P.C. In other words, §9 C.P.C. contains a presumption of jurisdiction from which the provisions regarding foreign sovereign immunity, §§84–86 C.P.C. make an exception. This fact also is expressed through the drafting technique employed in section 9 C.P.C., ‘subject to the provisions herein contained.’

§86 C.P.C. thus is an obstacle to the general rule of jurisdiction that is stated in §9 and limits the latter to the extent that §86 applies. As to the allocation of the burden of proof, the formulation of section 9, ‘… the Courts shall have jurisdiction … excepting suits …’ quite obviously favors the conclusion that the burden of upon the defendant foreign state for proving that an exceptional circumstances that barres jurisdiction, applies.

The burden of proof thus is upon the foreign state under this statutory schema. This is quite interesting as a result when we remember that rather early in this study, the same principle was applied by Chief Justice Marshal, in the Schooner Exchange (1812), which was the perhaps first precedent where in history the restrictive immunity doctrine was applied.

It is quite astonishing that the scrutiny for the burden of proof is much facilitated for India and Pakistan because the rule and the exception were stated in accordance with legal fundamentals, not with concessions to international diplomatic practice. The commentary of Row states:

[A] Court may have jurisdiction over a suit, if certain circumstances existed, but its jurisdiction may be excluded if certain other circumstances existed; if a plaintiff alleges the former set of circumstances and mentions nothing about the latter set, the Court is bound to take cognizance of the suit: it is for the defendant, if he wants to challenge the jurisdiction of the Court, to prove the latter set and, if he succeeds, the Court would be divested of the jurisdiction and would be bound to dismiss the suit. (Id.)

The commentary then cites precedents that clearly show that the burden of proof is upon the party seeking to oust jurisdiction; in other words, we can speak in such a situation of a presumption of jurisdiction, and under general rules of evidence, it is upon the party who works against the presumption that the burden lies with.

Whether a court has jurisdiction or not has to be decided with reference to the initial assumption of jurisdiction of the court. (Id., 42).

A party seeking to oust the jurisdiction or ordinary civil courts must establish his right to do so. (Id., 43).

Burden on defendant. It is for the party who seeks to oust the jurisdiction of a civil court to establish his contention. (Id., 52. See also Sarkar on Civil Procedure (1979), 17).

It is for the party to oust the jurisdiction to establish his right to do so. (Id., 18, citing Abdul Waheed v. Bhawani, A 1967 SC 576).

A presumption is against the ouster of jurisdiction of the ordinary courts and this presumption has to be overborne. (Id., citing Desikacharyulu v. S., A 1964 SC 807).

In case of doubt as to jurisdiction, court shall lean towards assumption of jurisdiction.

— Id., citing Gurdwara & C. v. Rattan, A 1955 SC 576. See also Sarkar’s Law of Evidence (1981), sect. 101–4, p. 939: ‘Jurisdiction. It is for the party who seeks to oust the jurisdiction of a civil court to establish his contention.’ In addition, see Order 6, Rule 13 of the C.P.C. of 1908: ‘Presumption of Law. Neither party need in any pleading allege any matter of fact which the law presumes in his favour or as to which the burden of proof lies upon the other side unless the same has first been specifically denied.’

After having outlined this important point of departure, from a point of view of civil procedure, let us now see what we can find, both in India and Pakistan, with regard to foreign sovereign immunity legislation and development.


Foreign Sovereign Immunity in India

India’s Internal Legislation

In India, section 86 C.P.C. of 1908 is in force in the version of the Amendment Act of 1976, which has replaced the expression ‘Ruler of a foreign State’ with ‘foreign state.’

§86 C.P.C.

(1) No foreign State may be sued in any Court otherwise competent to try the suit except with the consent of the Central Government certified in writing by a Secretary to that Government:
Provided that a person may, as tenant of immovable property, sue without such consent as aforesaid a foreign State from whom he holds or claims to hold the property.
(2) Such consent may be given with respect to a specified suit or to several specified suits or with respect to all suits of any specified class or classes, and may specify, in the case of any suit or class of suits, the Court in which the foreign State may be sued, but it shall not be given, unless it appears to the Central Government that the foreign State —
(a) has instituted a suit in the Court against the person desiring to sue it, or
(b) by itself or another, trades within the local limits of the jurisdiction of the Court, or
(c) is in possession of immovable property situated within those limits and is to be sued with reference to such property or for money damages charged thereon, or
(d) has expressly or impliedly waived the privilege accorded to it by this section.
(3) Except with the consent of the Central Government, certified in writing by a Secretary to that Government, no decree shall be executed against the property of any foreign State.
(…)
(6) Where a request is made to the Central Government for the grant of any consent referred to in sub-section (1), the Central Government shall, before refusing to accede to the request in whole or in part, give to the person making the request a reasonable opportunity to being heard.

— For commentary, see Jagdish Lal, Code of Civil Procedure, 1908 (1981), 43–44 and Sarkar on Civil Procedure (1979), 207.

To repeat it, this is not just an editorial change, but a real adaptation of the law to the needs of a modern state. Instead of protecting foreign rulers with sovereign immunity, the law then granted the privilege to foreign states.

Furthermore, what is interesting here is that this privilege is granted to foreign states in India’s internal civil procedure law, not as a matter of international law.

When we look more closely at section 86 C.P.C., we can make out a certain schema:

(i) In cases of 2(a) to (d), express consent by the Central Government of India is required for suing a foreign state in any civil court in India;

(ii) in case the plaintiff is a tenant of immovable property, he may file a suit against the foreign state, without such consent, provided he has received, or claims to have received, that property from the foreign state.

Without the consent required in sections 2(a) to (d), the court has to dismiss the suit.

— See Sarkar on Civil Procedure (1979), 208. This is why the consent must be obtained by any plaintiff before filing a suit, as a preliminary action to be taken.

In legal terms, the consent requirement is a formal requisite for the court to try the suit, in other words, a preliminary condition for a court to assert jurisdiction.

— See §56 C.P.C.: ‘Suits expressly barred. A suit is said to be expressly barred when it is barred by any enactment for the time being in force.’ See The A.I.R. Manual (1979), Vol. III, C., Civil Procedure, S 9, N 56, p. 317.

It is thus the government of India that decides to grant immunity vel non to a foreign state, both regarding jurisdictional immunity, and immunity from execution.

That is why the question of the burden of proof in the sense of the ultimate or legal burden does not come up. But it is nonetheless interesting to look at the situation of a potential plaintiff under this system.

The governmental consent has an effect of unlocking the suability of a foreign state, which means that when consent is given, the plaintiff enjoys the legal presumption of §9 C.P.C. This is so because in general, the consent ‘… shall not be given, unless it appears to the Central Government that …;’ this is clearly a rule-and-exception schema as we have seen it at various occasions previously in this study. The rule is thus that despite the presumption of §9 C.P.C. when the defendant is a foreign state, the rule is that such foreign state is immune, except the administrative consent is given.

This sounds familiar somehow, as it resembles the practice of the state department in the United States before the enactment of the FSIA, with the State Department giving ‘suggestions’ to the courts to grant immunity vel non. But there is nonetheless an important difference in that Indian law does not leave it over to ‘political considerations’ if immunity is to be granted, or not, but the law gives precise directives in which cases the administrative consent is to be granted, or denied. There are precisely four exceptions to immunity, so to speak, as in these cases, and only in these cases, the administrative consent is to be granted.

§86(2) C.P.C.

(a) the foreign state has instituted a suit in the Court against the person desiring to sue it;
(b) the foreign state, by itself or another, trades within the local limits of the jurisdiction of the Court;
(c) the foreign state is in possession of immovable property situated within those limits and is to be sued with reference to such property or for money damages charged thereon;
(d) the foreign state has expressly or impliedly waived the privilege accorded to it by this section.

In this schema, the burden of proof, in front of the administrative force, is upon the plaintiff for demonstrating that one of these exceptions is applicable. This result also follows from the fact that the administrative consent is, to repeat it, a key for unlocking the judicial ‘barrenness’ of an action against a foreign state.

While this is not a burden of proof in the strict meaning of the term, it is an analogous situation to the judicial term, only that the plaintiff acts here in front of the administration.

It is for that matter not correct, as sometimes voiced in the literature, that in India actions against foreign states were ‘generally excluded;’ they are possible under the conditional bar of the administrative consent requirement. When consent is given, this consent binds the court.

— See Sarkar on Civil Procedure (1979), 206–207: ‘When the Central Government gives consent to the institution of suits … , such consent cannot be questioned by the court. It is conclusive.’

In addition, §86(6) C.P.C. clarifies that the plaintiff, within that administrative procedure, is to be given a ‘reasonable opportunity to be heard.’

Despite the consent requirement, sovereign immunity in India cannot be said to be an absolute rule, as this is sometimes voiced in the literature. The legislative situation in India can for that matter not be compared with the situation in the United States before the FSIA, while such a comparison is of course tempting. It is true that the State Department filed suggestions to the courts and that courts generally followed them. But the State Department’s decisions were based upon political motives and they were for that reason not predictable, or at least not as predictable as this is the case in India, under §86(2) C.P.C.

The Tate Letter of 1952 did not change this situation for it was but the expression of an administrative goodwill; it just announced a policy change, that is, the political will to follow the restrictive immunity doctrine. That did not per se render the decisions of the State Department more predictable than before, because political considerations were not excluded, not even under the restrictive immunity doctrine.

There is still another difference between the two legal situations. In the United States it was the defendant foreign state that addressed the State Department for immunity to be granted, but in India it’s the plaintiff. In the United States, when a foreign state omitted to plead immunity in front of the administrative, it could be sued without obstacle. In India, however, foreign states are exempt from jurisdiction, except the plaintiff succeeds to be given the administrative consent for suing the foreign state; and to that purpose, the cases enumerated in §86(2) C.P.C. for which consent will be given, are conclusive, and exhaustive.

— Sanjiva Row, Code of Civil Procedure (1962), s. 86, 622: ‘The section relates to a matter of public policy and the express provisions contained herein are imperative and must be observed. The section is exhaustive of cases where consent can be given. Consent cannot be given on any other ground.’

In fact, when we consider the four exceptions to the general rule of immunity, §86(2) C.P.C., we can say they are really ‘classical’ immunity exceptions. In addition, section §86(2)(b) provides an exception for commercial activities of a foreign state, typical for the restrictive immunity doctrine. This alone suffices as conclusive proof that to talk about an ‘absolute’ immunity doctrine in India, is not correct, despite the requirement of administrative consent.

The burden of proof question is particularly interesting under §86(2)(c) C.P.C. for the criterion that ‘the foreign state is in possession of immovable property situated within those limits and is to be sued with reference to such property or for money damages charged thereon.’ First, it’s necessary that the plaintiff be a tenant of such property. The question is who bears the burden of proof for the plaintiff be a valid tenant under this section, that is, the existence of a rental contract between the plaintiff and the foreign state?

When we consider the presumption of jurisdiction in §9 C.P.C., we would have to conclude that the burden is upon the party who seeks to oust jurisdiction, that is, the foreign state. The rental contract would so to speak ‘automatically’ remove immunity for the foreign state. But under section 86(2) the burden is upon the plaintiff to show that the conditions for any such removal of immunity are fulfilled. So we are facing a paradoxical situation on first sight.

The result would namely be in contradiction with §9 C.P.C. Let me forward two arguments to resolve this riddle. First of all, the plaintiff has anyway to prove the existence of the contract because he derives a legal right from it.

Once he can prove that a contract exists, immunity will be removed as a matter of law. But the situation is more complex than that, as the plaintiff also bears the burden of proving, in front of the administrative force, the conditions for the governmental consent under §§86(2)(a) to (d). Second, §86 represents an exception to the general rule of jurisdiction established by §9 C.P.C.

In other terms, §86 C.P.C. is to be considered as a lex specialis for cases where the defendant is a foreign state, which grants the courts competence only under the conditions enumerated by §§86(2)(a) to (d) and when administrative consent is given. Hence, the burden of proof, or ‘immunity risk,’ must be with the plaintiff.

The Relationship between Internal Law and International Law

The relationship between internal law and international law in India, regarding foreign sovereign immunity, merits a brief exam.

We have already seen for the Singapore Act that the question is not the general problem if international law takes effect upon municipal law by either transformation or incorporation; the problem is neither if international law can limit municipal law for any question of sovereign immunity to be granted, or not.

Let me first quote two experts from India on this matter, Prabhas C. Sarkar and Sudipto Sarkar:

The effect of s. 86(1) is thus to modify to a certain extent the doctrine of immunity by International Law for when such consent is granted as required by s. 86(1) it would not open to a foreign state to rely on that doctrine because the municipal courts in India would be bound by the statutory provisions contained in the CP code. (Sarkar on Civil Procedure (1979), 208, quoting Ali Akbar v. U.A.R., A 1966 SC 230).

Sarkar refers to the ‘absolute’ immunity doctrine, supposing that India’s municipal law is different in respect of the statutory regulation of foreign sovereign immunity.

The question is even more complex regarding immunity from execution in India because the law does not contain any exception to that immunity rule.

Also, administrative consent is regulated in a different manner regarding immunity from execution;, even in a case where administrative consent for the suit is not needed, such consent still must be obtained for any measure of execution of the judgment, into the property of a foreign state.

— See The A.I.R. Manual (1979), Vol. III, C., Civil Procedure, S 86, N 12, p. 667. See also Ian Sinclair, The Law of Sovereign Immunity, 167 RCADI (1980-II) 117, 195 (Modern Case Law: India): ‘… , but again there are rudimentary dicta which seem to hint at possible limitations of the absolute immunity doctrine.’

An interesting leading case was rendered by the Court of Appeals of India in Agrawala v. Union of India, A.I.R. 1980, Sikkim 22, 21 IND. J.INT’L L. 594–600 (1981), which was a suit against the Union of India which was filed already in 1972 in a Sikkim court.

Sikkim was becoming a member of the union only in 1975 and, before that time, had the status of a protectorate of the Union. The Court of Appeals thus had first to decide if the suit could be maintained even after incorporation of the Sikkim, and second, if the Union of India was to be granted immunity from jurisdiction. The litigation was about a contract concluded between the plaintiff and the Union.

It is important to see, first of all, that the Union of India did not invoke absolute sovereign immunity but argued that the terms of §86 C.P.C. were valid also for the Sikkim, which was an important consideration in the litigation, as administrative consent was not given. The Court of Appeals concluded that before incorporation, India was ‘a foreign state vis-à-vis Sikkim’ and confirmed to maintain the suit as India, by not invoking immunity, had waived its right to immunity.

— A.I.R. 1980, Sikkim 22, 26, IND. J.INT’L L. 594, 595, quoting Lassa Oppenheim, International Law (1905/1955), Vol. 1, 193, who says that a protectorate ‘is not to be considered to be a part of a portion of the protecting State.’

India’s argument, that §86 C.P.C. was valid also for Sikkim, was rejected by the court.

— A.I.R. 1980, Sikkim 22, 26–27, IND. J.INT’L L. 594, 596.

But the most interesting in this leading case was the obiter dictum of the Court of Appeals.

Agrawala v. Union of India (C.A.)

7. It should be noted that the doctrine of absolute immunity in favour of foreign States from being sued in the Courts of India has not been accepted in India and under the provisions of Section 86, Civil Procedure Code, 1908, the only immunity that foreign States enjoy is a limited immunity from being sued without the consent of the Central Government. (Id.)

Indian case law is highly instructive for the interpretation of §86 C.P.C. In 1965, in Kashani v. United Arab Republics, Civil Appeal No. 220 of 1964, A.I.R. 1966 SC 230, 60 AJIL 861 (1966), 64 ILR 489 (1983), the Supreme Court of India ruled that §86(1) C.P.C., which at the time was only embracing ‘Rulers of a foreign state,’ applies ‘to cases where suits are brought against Rulers of foreign States and that foreign States fall within its scope whatever be their form of Government.’ Regarding the relationship between municipal law and international law in India, the Supreme Court stated:

The effect of the provisions of s. 86(1) appears to be that it makes a statutory provision covering a field which would otherwise be covered by the doctrine of immunity under international law. It is not disputed that every sovereign State is competent to make its own laws in relation to the rights and liabilities of foreign States to be sued within its own municipal courts. Just as an independent sovereign State may statutorily provide for its own rights and liabilities to sue and be sued, 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 s. 86(1) is to modify to a certain extent the doctrine of immunity recognized 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 s. 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. (60 AJIL 861, 862).

It is interesting to observe that the Court of Appeals of India, in United Arab Republics v. Kashani (1961), 64 ILR 394 (1983), dismissed the appeal with the argument that ‘international law recognizes the absolute immunity of sovereign independent States from being sued.’

However, the Supreme Court, as we have seen, refused to grant the foreign state an immunity that is ‘more absolute’ than that granted under §86 C.P.C.

It is not important to know if such a rule was ever proven to exist in international law, or if both the absolute and restrictive immunity doctrine coexisted for a certain time; what is of interest in this decision is that the Supreme Court held that the municipal law of India primed over international law, in that particular question of the scope of the foreign sovereign immunity to be applied in the courts of India.

— This was the result of Judge Chauhan’s reasoning in the verdict of the Supreme Court of Pakistan in Qureshi v. Union of Soviet Socialist Republics, PLD 1981, 1, Supreme Court, 377, 20 ILM 1060, 64 ILR 585 (1983). We are going to see further down that the Supreme Court of Pakistan, in Qureshi, came to the exact opposite result for Pakistan, where Judge Chauhan admitted proof for a possible absolute immunity rule under international law, which if proof was conclusive, would result, according to the judge, in international law priming over Pakistan’s municipal law. However, as we are going to see, such conclusive proof could not be established even after long and extensive scrutiny by the court.

Conclusion

In India, we are encountering, in the opinion of some international law experts a modified ‘absolute’ immunity doctrine, which however, after further scrutiny reveals to be a restrictive immunity doctrine that is enhanced by an administrative consent requirement for most actions against foreign states, or their sovereigns.

§9 C.P.C. starts from a presumption of jurisdiction that is overcome only when a suit is expressly or implicitly barred. The burden of proof for such an exception from jurisdiction is upon the party that wants to have it applied, that is, the defendant.

However, contrary to §9 C.P.C. jurisdiction is generally barred when an action is brought against a foreign state or sovereign; this is a case where suits are expressly barred. However, the bar is conditioned by administrative consent for most cases.

Consequently, when we look at the whole of this statutory construction, we need to conclude that the burden of proof for the immunity claim is prima facie upon the foreign state or sovereign.

However, in practice, the plaintiff bears a burden of proof as well, namely for demonstrating in front of the administration that a case if applicable where governmental consent is to be given. In addition, it is to be seen that §86 C.P.C. is conclusive in the sense that this lex specialis contains the only possible way immunity is granted in the courts of India, and that foreign states cannot invoke any immunity rule derived from international law.


Foreign Sovereign Immunity in Pakistan

Introduction

In Pakistan, the development of sovereign immunity is still more a matter of historical originality as this is the case with India.

In fact, what we find here is a legislative heritage from India which was then modified by the State Immunity Ordinance, 1981, a statute comparable to the United Kingdom’s immunity act, and finally we got a leading case that brilliantly analyzed the whole of this complex situation, to arrive at a clear end result.

The decision of the Supreme Court of Pakistan of 8 July 1981 in Qureshi v. Union of Soviet Socialist Republics, PLD 1981, 1, Supreme Court, 377, 20 ILM 1060, 64 ILR 585 (1983), which we already mentioned, was a suit filed as early as in 1966, when the plaintiff, a Pakistani resident, claimed damages from the Soviet Union and its commercial representation in Pakistan as a result of breach of a contract providing for commercial services to the Soviet embassy in Pakistan, by the Soviet government. The action was dismissed by the High Court of West Pakistan, whereupon the plaintiff filed the appeal in 1969.

— The High Court held: ‘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 it may sue by virtue of section 84 but cannot be sued as 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 the 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.’ PLD SC 399, 20 ILM 1066.

The Supreme Court only ruled that appeal in 1981, and thus took 12 years (!) for rendering the judgment that finally gave right to the plaintiff, refusing to grant immunity to the Soviet government.

It is quite obvious that the court waited for the enactment of the State Immunity Ordinance, which entered into force on the 11th of March, 1981. The judgment followed on the 8th of July that same year!

Consequently, the court also had to rule on the question of a law changing during the litispendence of an action and the majority of the judges admitted the retroactive application of the Immunity Ordinance, given that it was not a legal right that was in question, but a mere procedural modification, for which retroactive application is generally admitted both in municipal law and international law.

— PLD SC 420, 421, §50, 20 ILM 1082. See also Sompong Sucharitkul who held in his course Immunities of Foreign States Before National Authorities, 149 RCADI (1976-I) 86, 121: ‘As has been observed, State Immunities are procedural in nature.’

As to the facts, it is important to see that the commercial representation of the USSR was constituted as an integral part of the Soviet embassy in Pakistan. This was stipulated in a bilateral treaty between the Soviet Union and Pakistan which conferred diplomatic immunity to the commercial representation. As a result, the Soviet Union claimed immunity not only in its quality of a foreign state, but also diplomatic immunity in favor of its commercial representation in Pakistan.

This is quite a unique constellation, as to make it all even more exotic that treaty was concluded as a letter exchange between the directors of the commercial representations of both the USSR and Pakistan, expressly considering the letter exchange to be a bilateral treaty between the two countries. As stated in the judgment:

(2) The functions of the Trade Representative will be to promote trade between the USSR and Pakistan and to represent the interests of the USSR in Pakistan in matters relating to trade between the two countries.
(3) The Government of Pakistan agrees to treat the USSR Trade Representation in Pakistan as an integral part of the USSR Embassy in Pakistan. Consequently the Trade Representative and his Deputies will be entitled to the usual diplomatic privileges and immunities and the premises in which the office of the Trade Representative is located and which will be specified, will enjoy extra-territoriality. No other business premises shall be extra-territorial. (…)
(4) All contracts entered into and signed for or on behalf of the Trade Representation shall be deemed to have been made in Pakistan and the Trade Representation shall be responsible for their due fulfillment. (PLD SC 389, 20 ILM 1066).

The court first held on the question of diplomatic immunity of the USSR trade representation in Pakistan and refused such immunity under the bilateral treaty.

— PLD SC 389, 390–396 (Judge Chauhan), 20 ILM 1066, 1067, 1070, §22, with a vast bibliography on diplomatic immunity, PLD SC 385, 20 ILM 1064. The judges were Karam Elahee Chauhan, PLD SC 398, 417–418, §§45–47, 20 ILM 1066, 1080–1081, Muhammad Haleem, PLD SC 398, 424, 20 ILM 1066, 1084, Muhammad Afzal Zullah, id., Nasim Hasan Shah, PLD SC 398, 432, 20 ILM 1066, 1088.

Diplomatic immunity is not a topic of the present study while there are well certain parallels between foreign sovereign immunity and diplomatic immunity.

The problem that was tackled in this decision is of great importance in international law in view of the consistent practice of the USSR to escape from foreign jurisdiction by ‘wearing different hats,’ and invoking diplomatic immunity in all possible ways. However, the Supreme Court of Pakistan was clear-cut in refusing the USSR such immunity, and all immunity at that.

Judge Chauhan first outlined in detail the practice of the USSR to invoke immunity in all possible ways to escape its international responsibilities in order to ultimately be responsible only in its own territorial jurisdiction and in front of its own courts. (PLD SC 389, 390, §8, 20 ILM 1066, 1067).

Then, the judge reported international practice that was heading at more and more depriving the USSR of immunity, in applying the restrictive immunity doctrine. In addition, the judge reported the practice of the USSR to conclude bilateral agreements that grant diplomatic immunity to all its trade representatives but also grant those representatives the right to submit to foreign jurisdiction if they deem such doing correct, even if it may be against the ruling doctrine of the USSR.

— PLD SC 389, 392, §13, 20 ILM 1066, 1067–1068, quoting from Kazimierz Grzybowsky, Soviet Public International Law, Doctrines — Diplomatic Practice (1970).

The judge concluded that in matters of international commercial transactions, ‘the position of a Soviet trade delegation is very much the same as that of private merchants.’ Looking at the bilateral treaty, the judge founded it divided in two parts:

(a) It is divided into two parts. In one part it makes the Trade Representation as an integral part of the USSR Embassy in Pakistan and consequently confirms the usual diplomatic or consular privileges or immunities on the Trade Representative and his two Deputies;
(b) Its other part prescribes the functions of the Trade Representation/Representative viz to promote trade between the USSR and Pakistan, and to represent the USSR interests relating to trade between the two countries;
(c) In that respect it authorizes the Trade Representation/Representative to enter into and sign trade agreements;
(d) It states that all such contracts shall be deemed to have been made with Pakistan.
(e) It further stipulates that the Trade Representation shall be responsible for their due fulfillment, … (PLD SC 389, 392, §13, 20 ILM 1066, 1068).

The judge concluded that diplomatic immunity was only covering the official functions of the trade representative and his two deputies, but not their commercial functions.

— Id., §15. ‘… , but its functions are of a trading and commercial nature, and it can represent USSR in transactions of that type and enter into contracts for that purpose.’

After having affirmed jurisdiction from the arguments provided in (d) and (e), the judge concluded with regard to the treaty:

The Treaty in this case thus combines the diplomatic status of the Trade Representation and its personnel, with the power of local Courts to decide disputes arising from trade operations conducted by it. (Id.)

Finally, Judge Chauhan examined the Vienna Convention on Diplomatic Relations of April 18, 1961 which was both ratified by the USSR and Pakistan, and concluded:

We have gone through the various Articles of the Vienna Convention and we note that to diplomatic agents and envoys they do not grant any jurisdictional privileges and immunity in respect of their commercial transactions which really are not part of their official functions as diplomats, etc.

— PLD SC 389, 396, §21, 20 ILM 1066, 1070. See also Art. 33(1)(c) of the Vienna Convention.

Historical Development of Foreign Sovereign Immunity

While sections 86 and 87 C.P.C. 1908 were replaced by the State Immunity Ordinance, 1981, we observe a different development of jurisdictional immunities in Pakistan from what we have seen was such development in India. When Pakistan adopted the Indian Civil Procedure Code, section 86(1) was still in the version of ‘Any Ruler of a foreign State… ’ and there was no legal reform comparable to that in India. In addition, the Supreme Court of Pakistan, in the Qureshi precedent refused to enlarge the scope of section 86(1) so as to encompass foreign states, staying with the literal wording.

— PLD SC 398, 417–418, §§45–47, 20 ILM 1066, 1080–1081. This question was of course not decisive, but an obiter dictum, as the court applied the State Immunity Ordinance 1981 retroactively to this case.

The conclusion of the Supreme Court was that in such a case, when the text is unequivocal, there is no room for interpretation.

Hence the municipal law of Pakistan did not recognize to grant immunity to foreign states, but only to their sovereigns. The presumption of jurisdiction, §9 C.P.C. could therefore not be refuted by section 86, as this was the case in India. Consequently, the defendant foreign state, seeking to oust jurisdiction, has to overcome the presumption of §9, and cannot for that matter apply any provision of Pakistani law, but only a rule or principle of international law.

This is an interesting result as during the validity of the first Civil Procedure Code of 1859, when there was not yet an administrative consent requirement — which was only introduced in 1877 — the lacuna in municipal law regarding foreign sovereign immunity was already recognized for British India in Jwala Pershad and another v. His Highness The Rana of Dholepore (1963), as reported by judge Chauhan in Qureshi.

… wherein it was held that it contained no provision specially exempting an independent Native Chief from the jurisdiction of our courts though immunity was granted to them on the ground of International Law as practiced under British Laws which applied here and whereunder a suit even for recovery of private debt was barred … (PLD SC 398, 414, §37, 20 ILM 1066, 1079).

This is equally valid for Burma, a country that has adopted the C.P.C. 1908 from British India. In 1948, the High Court of Burma, in U Kyaw Din v. His Britannic Majesty’s Government of the United Kingdom and the Union of Burma, 23 ILR 214 (1956), Whiteman’s Digest of International Law (1968) writes:

It is significant that while under Section 84 of the Code of Civil Procedure a foreign state may sue in any country [sic] in the Union of Burma, there is no provision in the Code which permits the institution of a suit against a foreign state. It would seem therefore that the authors of the Code of Civil Procedure followed the general law … (Whiteman, Digest of International Law (1968), Vol. 6, p. 560, [1948] Ann.Dig. 137–138 (No. 42).

The Relation between Municipal Law and International Law

The Supreme Court of Pakistan, in Qureshi, developed three arguments of how Pakistani municipal law and international law relate to each other.

(i) The relation between Pakistani municipal law and international law;

(ii) The present state of international law in matters of foreign sovereign immunity;

(iii) The burden of proof in respect to the existence of a rule of jurisdictional immunity under international law.

Contrary to the jurisprudence in India, that we retraced earlier on, the Supreme Court of Pakistan rejected USSR’s argument international law knew an absolute rule of foreign sovereign immunity:

As has been pointed out by my Lord Justice Chauhan section 86 of the Civil Procedure Code does not constitute a bar to a suit against a Foreign State in our country. The question then is whether such a suit is barred by any principle of customary International [Law]. (PLD SC 398, 432, 20 ILM 1066, 1088. (Judge Shah).

It is interesting to observe that this was recognized already in the early precedent Jwala Pershad (1863), that we reported already, so that we can speak of a consistency in Pakistani law and jurisprudence to not extend the meaning of §86 C.P.C. and recognize that actions against foreign states are not barred by this provision.

Such consistency namely is lacking in India, or rather, the opposite solution was taken since the precedent Kashani, where the old version of the C.P.C. of 1908 was enlarged, first by jurisprudence and later by legislative update, so that foreign states were encompassed by the section.

In their very extensive and well-researched judgments, judges Chauhan and Shah came to the conclusion that international law did not know a rule of ‘absolute’ sovereign immunity.

— Judge Chauhan examined British case law since Rahimtoola v. Nizam of Hyderabad, [1957] 3 All E.R. 441, and United States case law since Alfred Dunhill of London, Inc. v. Republic of Cuba, 425 U.S. 682 (1986) and also gave an overview over Italian, Belgian, Egyptian, Romanian, Swiss, French, Dutch, Austrian, Irish, Canadian and German jurisprudence on the matter of foreign sovereign immunity.

— Judge Shah equally examined British and American as well as Canadian case law, but also continental jurisprudence, even of the Soviet Union, Eastern European countries and Asian countries, as well as international conventions on the matter of jurisdictional immunities of foreign states. The judges Haleem and Zullah affirmed, PLD SC 397, §24, 20 ILM 1066, 1070.

Judge Chauhan concluded:

To give our answer straightaway, our study has led us to the conclusion that the grant or acceptance of absolute jurisdictional immunity to a Foreign State has neither been a uniform practice nor a rigid obligatory rule, and there has never been a uniformity of Courts of various countries in this respect, and if at any interval in time in the world it was so considered then it has undergone a tremendous change and has rather entrenched to the contrary. (Id.)

The sum total of the above discussion is that even under the Customary International Law or General International Law a suit of the present kind is not barred. (PLD SC 397, 408, 20 ILM 1066, 1076)

Judge Shah concluded:

A study of the law of sovereign immunity reveals the development of two conflicting concepts, each of which has been widely held and firmly established at one period or another. The upshot, in my view, of this discussion is that:
(1) Section 86 of the Civil Procedure Code does not bar the suit filed by the appellant against the respondents;
(2) That there is no positive rule of Customary International [Law] which can be pleaded as a bar of jurisdiction to the maintainability of the suit. On the other hand, the rule of International Law followed by most States at present and which rule, in my view, should be followed by the Courts of Pakistan is that acts of a commercial nature are not immune from the jurisdiction of the Municipal Courts. Therefore, the plaintiff’s suit was maintainable …’ (PLD SC 397, 453, 20 ILM 1066, 1098).

The Supreme Court of Pakistan decision stands out as an example for the firm establishment of restrictive immunity, a judgment also that has the merit to stand out both in academic scholarship and authority, and last not least in judicial clarity!

And the judgment also is fruitful as to our main question in this study, that is, who bears the burden of proof in such sovereign immunity litigation?

Judge Chauhan stated to this respect that ‘[t]he burden of proving that the rule of absolute immunity was a rigid inflexible rule was on the defendants, and we must say that they have failed to discharge the same … ’(PLD SC 397, §24, 20 ILM 1066, 1070).

This conclusion is logical and systemically sound as the rule is not sovereign immunity in Pakistan, but the presumption of jurisdiction, §9 C.P.C. from which immunity is the exception. We can thus say that the court has but affirmed what appeared already to be true under sections 9 and 86 C.P.C., where section 86 is the exception to section 9. This becomes even more obvious when reading the preliminary notes of the judgment that says: ‘Burden of proving ouster of jurisdiction, held, on defendants.’ (PLD SC 379, 20 ILM 1061).

It is to be expected that this judgment will draw wider circles in the international law literature, representing a leading case for future sovereign immunity litigation where the defendant foreign states seeks to invoke a pretendedly ‘absolute’ doctrine of foreign sovereign immunity to exist under international law.

However, with regard to the burden of proof, the Supreme Court of Pakistan has only stated about the burden of proof of a legal rule, not a fact, nor has it decided about immunity from execution.

The Supreme Court has not stated that this burden of proof also applies with regard to the facts at issue for the grant of immunity vel non. It was assumed from the start by the judges that the service contract between the plaintiff and the USSR trade representation was a commercial contract, an action de iure gestionis.

There is no indication to be found either in the later part of the judgment that deals with the State Immunity Ordinance, 1981.

However, the burden of proof regarding the facts at issue cannot differ from the burden of proof with respect to the existence of a legal rule, in international law, regarding foreign sovereign immunity.

To put it squarely, the burden can only be with the foreign state, which equally follows from the statutory construction of sections 9 and 86 C.P.C., but also from the relationship between the presumption of jurisdiction in §9 C.P.C., and §3 State Immunity Ordinance, 1981.

The State Immunity Ordinance, 1981

The State Immunity Ordinance (STIO), 1981, which entered into force on the 11 March 1981, replaced sections 86 and 87 C.P.C. of 1908.

It is important to note that the STIO has not replaced §9 C.P.C., the presumption of jurisdiction. The decisive question, with regard to the allocation of the burden of proof is thus which is precisely the relationship between §9 C.P.C. and §3(1) STIO 1981, which simply reads ‘General immunity from jurisdiction. A State is immune from the jurisdiction of the courts of Pakistan except as hereinafter provided.’

From a systematic perspective, the burden of proof derived from the intersectional relationship cannot have changed with respect to the pre-Ordinance legal situation. For the the older legal situation in Pakistan, as well as the analogous situation in India, we have concluded that the burden of proof is upon the foreign state to give a basis for its immunity claim by producing evidence to the effect that it is entitled to such immunity. This argument is valid a fortiori for the new legal situation, as the STIO 1981 has abandoned the requirement of administrative consent.

Let me shortly review the new systematic schema. The presumption of competence in §9 C.P.C. is refuted only when another legal provision expressly says so, ‘… excepting suits of which their cognizance is either expressly or impliedly barred. In the commentary of Sanjiva Row, Code of Civil Procedure (1962), we find that an express bar usually takes the form of another legal provision:

The expression ‘expressly barred’ means barred by virtue of enactment in force; and the cognizance of the entire suit as brought is barred. The section postulates the barring of jurisdiction of a particular class of suits of a civil nature by a clear intent manifested, or a clear provision made, by a valid and binding statute. Statutes ousting jurisdiction of civil courts are strictly construed. (S 7, N 7, p. 52).

Now, the general rule of immunity pronounced in §3(1) STIO 1981 is such an express provision that apparently bars jurisdiction of suits filed against foreign states.

But this rule is by no means unconditional; it applies only in the rare cases that none of the numerous exceptions applies. This means that in principle, the foreign state can take recourse to the general rule if none of the exceptions applies. These exceptions are:

STIO 1981

4. Submission to jurisdiction. 5. Commercial transaction and contracts performed in Pakistan. 6. Contracts of Employment. 7. Ownership, possession and use of property. 8. Patents, trade marks, etc. 9. Membership of bodies, corporate, etc. 10. Arbitrations. 11. Ships used for commercial purposes. 12. Value added tax, customs-duties, etc.

That means in practice that the foreign state must show that none of these exceptions applies for being entitled to immunity. That the foreign state thus has to prove a ‘negative fact’ doesn’t alter the burden of proof.

— This is general opinion, see, for example, Cross on Evidence (1979), Chapter IV(2), 97, Cross on Evidence, Second Australian Edition, §4.15, Phipson on Evidence (1982), §4–05, Phipson and Elliott, Manual of the Law of Evidence (1980), 53, John Henry Wigmore, Evidence in Trials at Common Law (1981), §288 with further references, Hoffmann/Zeffert, South African Law of Evidence (1983), 397, Sarkar’s Law of Evidence (1981), Section 101, 909 ‘Proof of Negative,’ McCormick on Evidence (1984), 949.

This argument is valid even a fortiori when we compare the new legal situation in Pakistan with the legal situation before the enactment of the State Immunity Ordinance, 1981.

The new immunity rule is pierced by so many exceptions that it appears to represent practically only a residual concept. Not only is the plaintiff under the new legal situation free from any administrative consent requirement, but he can sue a foreign state on so many grounds that from that there is not much left from that immunity rule. In other words, to grant a state immunity under the Ordinance requires a particular argument or justification.

In addition, the decision of the Supreme Court of Pakistan in Qureshi confirms that the burden of proof for an exception to jurisdiction is upon the defendant foreign state.

As to immunity from execution, Pakistan just as all other jurisdictions examined in the present study, adheres to an absolute immunity rule regarding property that belongs to foreign states, §86(3) C.P.C. There is no indication that the STIO 1981 wanted to change that legal situation, so much the more as the Ordinance in this point is literally identical with the British Act, §15(2) STIO 1981, as we have already seen in the discussion of the STIA 1978.

Hence, the burden of proof, in matters of immunity from execution is upon the plaintiff or judgment creditor to show that an exception to that absolute rule of immunity applies.


©2015 Peter Fritz Walter. Some rights reserved.
Creative Commons Attribution 4.0 International License.

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