[IN THE COURT OF APPEAL.]

THE PORTO ALEXANDRE.

[1919. N. No. 1315.]

Admiralty - Public Vessel - Immunity from Process of Arrest - Trading by Public Vessel.

A vessel owned or requisitioned by a sovereign independent state and earning freight for the state, is not deprived of the privilege, decreed by international comity, of immunity from the process of arrest, by reason of the fact that she is being employed in ordinary trading voyages carrying cargoes for private individuals.

The Parlement Belge (1880) 5 P. D. 197 considered and applied.

APPEAL from a decision of Hill J. setting aside the writ in rem and all subsequent proceedings against the steamship Porto Alexandre.

The Porto Alexandre, formerly the German-owned steamship Ingbert, a vessel of 2,699 tons gross, by a decree of the Portuguese Prize Court of January 30, 1917, was adjudged a lawful prize of war. She had previously been requisitioned by the Portuguese Government and handed over to the Commission of Services of Transports Maritims and was being employed in ordinary trading voyages earning freight for the Government.

In September, 1919, she loaded a cargo of cork shavings for carriage to Liverpool under a bill of lading from which it appeared that the cargo was shipped by and consigned to the Portuguese Import and Export Co., Ld. On September 13, when in the Crosby channel at the entrance to the Mersey, the vessel got aground and salvage services were rendered to her by three Liverpool tugs, the Nora, Expert and Torfreda. On September 16 a writ in rem was issued on behalf of the owners, masters and crews of these tugs in respect of the services against "the owners of the Portuguese steamship Porto Alexandre her cargo and freight." On September 24 the solicitors for the defendants accepted service of the writ and undertook to appear on behalf of the cargo owners, and on September 25 entered appearance "under protest" for the

owners and freight. On October 2 a motion was set down to set aside the writ and all subsequent proceedings on the ground that the Porto Alexandre and the freight "were and are the public national property of and/or requisitioned by and in the possession and public use and service of the Portuguese Government." The motion came before Hill J. on October 20 and 27, 1919, and was supported by a communication from the Portuguese Chargé d'Affaires to Lord Curzon, the Secretary of State for Foreign Affairs, who in turn communicated it to the learned judge, that the Porto Alexandre was "a state-owned vessel belonging to the Government of the Portuguese Republic."

Hill J. in giving judgment said that he had arrived at his decision with the greatest reluctance. Upon the facts he was prepared to find, if it were necessary, that the Porto Alexandre was being used in ordinary commerce, and that the only interest of the Portuguese Government was in the earning of freight. But in his view the law as laid down in The Parlement Belge (1) was that a sovereign state could not be impleaded either by being served in personam or indirectly by proceedings against its property; and if that were the principle it mattered not how the property was being employed. His Lordship continued: "I think therefore that this motion succeeds upon the ground that it is established that this ship was the property of the Portuguese Government at the time of arrest and is now its property. It therefore follows that so far as the ship and freight are concerned, the writ and all subsequent proceedings must be set aside, but the writ and all subsequent proceedings so far as the cargo is concerned, will remain good. I have already, in previous cases, pointed out what I conceive to be very strong reasons why it is undesirable that cases should be withdrawn, as this is being withdrawn, from the Courts, but I have only to assert now what I conceive to be the law."

The plaintiffs appealed.

Nov. 10. C. R. Dunlop K.C. and J. B. Aspinall for the

(1) 5 P. D. 197.

appellants. Although a sovereign ruler cannot be impleaded even in respect of private transactions, international comity does not extend the same immunity to the property of states unless employed in the public service. The decision of the Court of Appeal in The Parlement Belge (1) no doubt qualifies to some extent the views of Sir Robert Phillimore as expressed in the Court below in that case(2) and in The Charkieh.(3) But the Court of Appeal, in reversing Sir Robert Phillimore, took a different view of the facts, and the case is not an authority for the proposition that a foreign state-owned merchant ship engaged on an ordinary mercantile voyage is immune from the process of arrest. The Parlement Belge was a mail-boat, and although carrying passengers and cargo, this was merely ancillary to her real employment, which was that of carrying the Belgian State mails. The correct view was that stated by Marshall C.J. in an old American authority (U.S. Bank v. Planters' Bank (4)), that "when a government becomes a partner in any trading company, it devests itself, so far as concerns the transactions of that company, of its sovereign character." [The Prins Frederik (5) was also referred to.]

D. Stephens K.C. and A. W. Grant for the respondents were not called on.

BANKES L.J.This is an appeal from a decision of Hill J., who made an order that the writ and warrant for arrest, and all subsequent proceedings against the Porto Alexandreand freight, be set aside, but the proceedings against the cargo should stand. The learned judge was only concerned with the question of the ship, and this appeal has only reference to the ship.

The vessel in question was on a voyage from Lisbon to Liverpool, and she ran aground in the Mersey, and three tugs were engaged to get her off. An action was brought, and the ship was arrested in respect of the services rendered to her by these tugs. The application which the learned judge granted was founded upon the contention that the vessel was the

(1) 5 P. D. 197.

(2) (1879) 4 P. D. 129.

(3) (1873) L. R. 4 A. & E. 59, 74.

(4) (1824) 9 Wheat. 904, 907.

(5) (1820) 2 Dods. 451.

property of a sovereign state, the Republic of Portugal, and, on that ground, that she was exempt from arrest. The conclusion of fact at which the learned judge arrived was that it had been established that the ship was the property of the Portuguese Government at the time of the arrest, and is still their property, and on that ground he made the order.

It is now contended that it is not sufficient for a sovereign or a sovereign state to allege that a vessel is the property of such sovereign or sovereign state, and that the allegation must go further and say the vessel is employed in the public service or on public service.

The facts with regard to the vessel are as follows: She was originally a German merchant vessel, and in August, 1916, she was requisitioned by the Portuguese Government. On August 11 what is called a passport was issued, which authorized the employment of the vessel and contains notes upon it, indicating that during the period that the vessel was at the service of the Portuguese Government, for which she was requisitioned, her port of register should be Lisbon. There is also an indorsement on the passport stating that on January 30, 1917, she was adjudged a lawful prize of war. Mr. Dunlop has pointed out that the statement that she was adjudged a lawful prize of war leaves it doubtful whether she has become the actual property of the Portuguese Government, or whether she was merely detained pending the conclusion of peace. It would rather appear that the latter is the proper conclusion, because there is an affidavit by the Portuguese vice-consul at Liverpool, who says that the vessel is, and has been, requisitioned by the Portuguese Government for the service of the State, and is employed under the orders of the Government. There is a further statement in writing by the Portuguese Consul at Liverpool, in which he says in reference to this particular voyage that the freight on the cargo was paid before shipment and belongs solely and entirely to the Portuguese Government. In addition to that, there is a letter from the Portuguese Chargé d'Affaires, in which he states definitely that the Porto Alexandre is a public service vessel belonging to the Portuguese Government.

There is no reason to doubt the accuracy of the statements that have been made on affidavit in this case - that the vessel has been requisitioned under the order of the Portuguese Government, and that on the particular voyage she was carrying freight for that Government. Mr. Dunlop, however, contends that is not sufficient, because it is shown she was engaged in what he says was an ordinary commercial undertaking, as an ordinary trading vessel carrying goods for a private individual or a private company. The question is, whether it is possible in the circumstances of this case to distinguish it from The Parlement Belge(1), which was a decision of this Court, and is binding upon us.

I gather from the judgment of Hill J., and from what has been said by learned counsel, that this question is becoming one of growing importance. In the days when the early decisions were given, no doubt what were called Government vessels were confined almost entirely, if not exclusively, to vessels of war. But in modern times sovereigns and sovereign states have taken to owning ships, which may to a still greater extent be employed as ordinary trading vessels engaged in ordinary trading. That fact of itself indicates the growing importance of the particular question, if vessels so employed are free from arrest.

The function of this Court in this particular case is to decide whether it is covered by The Parlement Belge.(1) I think it is, and it is therefore not necessary or desirable that the Court should enter upon a discussion of the wider question at this stage, or consider the importance of other views that may be taken. There is very little difference between the material facts in The Parlement Belge (1) and in the present case, and in my opinion The Parlement Belge (1) is an authority which covers the present case. It is quite true that in many of the earlier cases the claim put forward, with regard to a particular ship, was that she was on public service and employed in the public service, and no doubt the statement so made was applicable to the particular case, and was made because it was applicable to the particular case, and the judgments were

(1) 5 P. D. 197.

delivered in reference to the facts so stated. But in this case the Court is bound by the decision in The Parlement Belge (1) and the appeal must be dismissed with costs.

WARRINGTON L.J.I am of the same opinion. I think the case is clearly covered by the decision in The Parlement Belge (2), and, that being so, we have no alternative but to dismiss the appeal.

In the present case, the facts proved appear to me to amount to this: It is first proved that the ship in question is a public vessel, the property of the Portuguese Government; next it is proved by the affidavits that it is in their possession for the service of the State; and, thirdly, it is proved that it is employed under the orders of the Government. There is one passage in the judgment of Brett L.J. in The Parlement Belge (2) in which he is expressing what he considers to be the result of the judgment in Briggs v. Light Boats (3), an American case, of which he obviously approves and on which he founds his own conclusion. He says: "The ground of that judgment is that the public property of a Government in use for public purposes is beyond the jurisdiction of the Courts of either its own or any other State, and that ships of war are beyond such jurisdiction, not because they are ships of war, but because they are public property. It puts all the public movable property of a State, which is in its possession for public purposes in the same category of immunity from jurisdiction as the person of a sovereign, or of an ambassador, or of ships of war, and exempts it from the jurisdiction of all Courts for the same reason - viz., that the exercise of such jurisdiction is inconsistent with the independence of the sovereign authority of the State." And then again, when he is summing up the principle which he thinks is to be deduced from all the cases he says: "As a consequence of the absolute independence of every sovereign authority and of the international comity which induces every sovereign state to respect the independence of every other sovereign state, each and every one declines

(1) 5 P. D. 197.

(2) 5 P. D. 213, 217.

(3) (1865) 93 Mass. 157.

to exercise, by means of any of its Courts, any of its territorial jurisdiction over the person of any sovereign or ambassador of any other state, or" - and these are the material words - "over the public property of any state which is destined to its public use, or over the property of any ambassador, though such sovereign, ambassador, or property be within its territory, and, therefore, but for the common agreement, subject to its jurisdiction."

Whatever may be the actual use to which this ship is put, I think the evidence is quite sufficient to show that it is the property of the State, and is destined to public use; and, that being so, the case seems to me to come exactly within the principle of the judgment in The Parlement Belge (1), with the result which I indicated at the beginning of my judgment.

SCRUTTON L.J.In this case the Porto Alexandre came into the Mersey, got on to the mud, and was salved by three Liverpool tugs. On arresting her to obtain security for the payment of their salvage, the Portuguese Republic, through the Portuguese Chargé d'Affaires, put foward a statement that she was a public vessel of the Portuguese Republic, and was therefore exempt from any process in England. Accordingly the defendants moved to set aside the writ and arrest. Hill J. in the Admiralty Court granted the application and the plaintiffs' appeal to this Court.

Now this state and other states proceed in their jurisprudence on the assumption that sovereign states are equal and independent, and that as a matter of international courtesy no one sovereign independent state will exercise any jurisdiction over the person of the sovereign or the property of any other sovereign state; and now that sovereigns move about more freely than they used to, and do things which they used not to do, and now that states do things which they used not to do, the question arises whether there are any limits to the immunity which international courtesy gives as between sovereign independent states and their sovereigns. I think it has been well settled first of all as to the sovereign that there

(1) 5 P. D. 197.

are no limits to the immunity which he enjoys. His private character is equally free as his public character. If he chooses to come into this country under an assumed name and indulge in privileges not peculiar to sovereigns, of making promises of marriage and breaking them, the English Courts still say on his appearing in his true character of sovereign and claiming his immunity, that he is absolutely free from the jurisdiction of this Court. That is the well-known case of Mighell v. Sultan of Johore.(1) It has been held, as Mr Dunlop admits, in The Parlement Belge (2) that trading on the part of a sovereign does not subject him to any liability to the jurisdiction. His ambassador is in the same position; an ambassador coming here as an ambassador of the sovereign may engage in private trading, but it has been held that his immunity still protects him even from proceedings in respect of his private trading. Jervis C.J. in Taylor v. Best (3), said: ".... if the privilege does attach, it is not, in the case of an ambassador or public minister, forfeited by the party's engaging in trade, as it would, by virtue of the proviso in the 7 Anne, c. 12, s. 5, in the case of an ambassador's servant. If an ambassador or public minister, during his residence in this country, violates the character in which he is accredited to our Court, by engaging in commercial transactions, that may raise a question between the Government of this country and that of the country by which he is sent; but he does not thereby lose the general privilege which the law of nations has conferred upon persons filling that high character, - the proviso in the statute of Anne limiting the privilege in cases of trading applying only to the servants of the embassy." There being no limitation in the case of the sovereign, and no limitation in the case of the ambassador, is there any limitation in the case of the property? Mr. Dunlop has argued before us that in the case of property of the state there is a limitation, and that - as I understand him - if the property is used in trading that cannot be for the public service of the state. That is not the way in which

(1) [1894] 1. Q. B. 149.

(2) 5 P. D. 197.

(3) (1854) 14 C. B. 487, 519.

he expressed it, but it appears to me to be the proposition which emerges from his argument.

We are concluded in this Court by the decision in The Parlement Belge.(1) Sir Robert Phillimore took the view that trading with the property of a state might render that property liable to seizure; but the Court of Appeal in The Parlement Belge (1) overruled the views of Sir Robert Phillimore, as I understand them. The principle then laid down has been recited by the other members of the Court. Brett L.J. said: "As a consequence of the absolute independence of every sovereign authority and of the international comity which induces every sovereign state to respect the independence of every other sovereign state, each and every one declines to exercise by means of any of its Courts, any of its territorial jurisdiction over the person of any sovereign or ambassador of any other state, or over the public property of any state which is destined to its public use." One of the reasons given seems to me conclusive: the moment property is arrested in the Admiralty Court a proceeding is instituted against the person, and the person is compelled to appear if he wants to protect his property, and by seizing his property the personal rights of the sovereign or the personal rights of the state are interfered with. The position seems to me to be very accurately stated in the 7th edition of Hall's International Law at p. 211, where, after dealing with warships and public vessels so called, Mr. Hall goes on to deal with other vessels employed in the public service and property possessed by the state within foreign jurisdiction, and says: "If in a question with respect to property coming before the Courts a foreign state shows the property to be its own, and claims delivery, jurisdiction at once fails, except in so far as it may be needed for the protection of the foreign state."

I quite appreciate the difficulty and doubt which Hill J. felt in this case, because no one can shut his eyes, now that the fashion of nationalisation is in the air, to the fact that many states are trading, or are about to trade, with ships belonging to themselves; and if these national ships wander about

(1) 5 P. D. 197, 217.

without liabilities, many trading affairs will become difficult; but it seems to me the remedy is not in these Courts. The Parlement Belge (1) excludes remedies in these Courts. But there are practical commercial remedies. If ships of the state find themselves left on the mud because no one will salve them when the State refuses any legal remedy for salvage, their owners will be apt to change their views. If the owners of cargoes on national ships find that the ship runs away and leaves them to bear all the expenses of salvage, as has been done in this case, there may be found a difficulty in getting cargoes for national ships. These are matters to be dealt with by negotiations between Governments, and not by Governments exercising their power to interfere with the property of other states contrary to the principles of international courtesy which govern the relations between independent and sovereign states. While appreciating the difficulties which Hill J. has felt, I think it is clear that we must, in this Court, stand by the decision already given, and the appeal must be dismissed.

Solicitors for the appellants: Thomas Cooper & Co., for Hill, Dickinson & Co., Liverpool.

Solicitors for the respondents: Botterell & Roche, for Weightman, Pedder & Co., Liverpool.

(1) 5 P. D. 197, 217.

E. C. T.