[COURT OF APPEAL]

HESPERIDES HOTELS LTD. AND ANOTHER v.

AEGEAN TURKISH HOLIDAYS LTD. AND ANOTHER

[1977 H. No. 910]

Conflict of Laws - Jurisdiction - Tort - Action for conspiracy in England to procure trespass to land and chattels situate outside jurisdiction - Greek Cypriot hotels under Turkish Cypriot control - Prayer for interim injunction - Whether jurisdiction to entertain action in English court

Two companies registered under the law of the Republic of Cyprus owned Greek Cypriot hotels in Kyrenia when it was occupied by troops from Turkey invading the north of the island in 1974. They issued a writ in 1977 against an English travel company and an individual as "London representative" of the "Turkish Federated State of Cyprus", claiming damages and an injunction to restrain the defendants from conspiring to procure, encourage, or assist trespass to the hotels by circulating brochures and inviting tourists to book holidays in the hotels. They also moved the judge in chambers for an interim injunction in terms of the writ. May J., after applying for and receiving a Foreign Office certificate which stated that Her Majesty's Government did not recognise the administration established under the name "Turkish Federated State of Cyprus" de facto or de jure, granted an interim injunction in the terms asked for and refused an application by the individual defendant to set aside the writ for want of jurisdiction.

The individual defendant appealed. During the appeal the plaintiff companies amended their writ to claim in addition the same relief in respect of conspiracy to trespass to the contents of their hotels. The court admitted de bene esse further evidence on behalf of the individual defendant, to the admission of which the plaintiffs objected and to which they had not replied which asserted that in that part of Cyprus under effective Turkish Cypriot control there was operative a system of law under which the acts in relation to possession and use of the plaintiffs' hotels were lawful and so not actionable and that therefore such an action could not be entertained by the English court:-

Held, allowing the appeal, discharging the injunction and setting aside the writ, (per Roskill and Scarman L.JJ.) that the plaintiffs' action was in substance an action for relief against trespass to immovables situate out of England and was therefore an action which the English court had no jurisdiction to entertain, and that its true nature could not be disguised by calling it a conspiracy to trespass by persons within the jurisdiction; nor did the amendment of the writ to allege trespass to movables in the hotels cure the jurisdictional defect so as to entitle the plaintiffs to interim relief by way of injunction in interlocutory proceedings.

British South Africa Co. v. Companhia de Mocambique [1893] A.C. 602, H.L.(E.) followed.

Per Lord Denning M.R. On the evidence before the court there is an effective administration in northern Cyprus under the laws of which the people who occupy the plaintiffs' hotels are not trespassers but occupy them lawfully; and as neither trespass to the land nor to the contents of the hotels is actionable according to the law in force in northern Cyprus, it is not actionable in England; and if the alleged trespass is not actionable an alleged conspiracy to trespass is also not actionable. I would unhesitatingly hold that the courts of this country can receive evidence and recognise the laws or acts in regard to day to day affairs of a body in effective control of a territory, even though it has not been recognised de jure or de facto by Her Majesty's government (post, pp. 218G, 221F - 222B).

Orders of May J. reversed.

The following cases are referred to in the judgments:

Aksionairnoye Obschestvo A. M. Luther v. James Sagor and Co. [1921] 1 K.B. 456; [1921] 3 K.B. 532, C.A.

American Cyanamid Co. v. Ethicon Ltd. [1975] A.C. 396; [1975] 2 W.L.R. 316; [1975] 1 All E.R. 504, H.L.(E.).

Boys v. Chaplin [1971] A.C. 356; [1969] 3 W.L.R. 322; [1969] 2 All E.R. 1085, H.L.(E.).

British South Africa Co. v. Companhia de Mocambique [1892] 2 Q.B. 358, C.A.; [1893] A.C. 602, H.L.(E.).

Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1965] Ch. 596; [1965] 2 W.L.R. 277; [1965] 1 All E.R. 300, C.A.; [1967] 1 A.C. 853; [1966] 3 W.L.R. 125; [1966] 2 All E.R. 536, H.L.(E.).

Government of the Republic of Spain v. S.S. Arantzazu Mendi (The Arantzazu Mendi) [1939] A.C. 256; [1939] 1 All E.R. 719, H.L.(E.).

James (An Insolvent), In re (Attorney-General intervening) [1977] Ch. 41; [1977] 2 W.L.R. 1; [1977] 1 All E.R. 364, C.A.

Marrinan v. Vibart [1963] 1 Q.B. 234; [1962] 2 W.L.R. 1224; [1962] 1 All E.R. 869; [1963] 1 Q.B. 528; [1962] 3 W.L.R. 912; [1962] 3 All E.R. 380, C.A.

Mostyn v. Fabrigas (1774) 1 Cowp. 161; 1 Smith L.C. 642.

Nissan v. Attorney-General [1968] 1 Q.B. 286; [1967] 3 W.L.R. 1044; [1967] 2 All E.R. 1238, C.A.; [1970] A.C. 179; [1969] 2 W.L.R. 926; [1969] 1 All E.R. 629, H.L.(E.).

Phillips v. Eyre (1870) L.R. 6 Q.B. 1.

Skinner v. East India Co. (1666) 6 St.Tr. 710.

Swiss Israel Trade Bank v. Government of Salta [1972] 1 Lloyd's Rep. 497.

Tolten, The [1946] P. 135; [1946] 2 All E.R. 372, C.A.

Ward v. Lewis [1955] 1 W.L.R. 9; [1955] 1 All E.R. 55, C.A.

The following additional cases were cited in argument:

Bird v. O'Neal [1960] A.C. 907; [1960] 3 W.L.R. 584; [1960] 3 All E.R. 254, P.C.

Crofter Hand Woven Harris Tweed Co. Ltd. v. Veitch [1942] A.C. 435; [1942] 1 All E.R. 142, H.L.(Sc.).

Deschamps v. Miller [1908] 1 Ch. 856.

Gouriet v. Union of Post Office Workers [1977] Q.B. 729; [1977] 2 W.L.R. 310; [1977] 1 All E.R. 696, C.A.

King of the Hellenes v. Brostrom (1923) 16 Ll.L.Rep. 167.

St. Pierre v. South American Stores (Gath and Chaves) Ltd. [1936] 1 K.B. 382, C.A.

Torquay Hotel Co. Ltd. v. Cousins [1969] 2 Ch. 106; [1969] 2 W.L.R. 289; [1969] 1 All E.R. 522, C.A.

INTERLOCUTORY APPEAL from May J.

The plaintiffs, Hesperides Hotels Ltd. and Catsellis Hotels Ltd., two companies incorporated according to the law of the Republic of Cyprus, had been and still were at all material times the owners and proprietors of, respectively, the Hesperides Hotel and the Dome Hotel at Kyrenia, Cyprus. By a writ issued in London in February 1977 against Aegean Turkish Holidays Ltd., a company incorporated in England, and one Omer Faik Muftizade, they claimed against each of the defendants damages; an inquiry as to each and every sum of money and an account of all profits received by each of the defendants by reason of an alleged conspiracy set out in the writ, as amended during the hearing in the Court of Appeal; and an injunction restraining them from conspiring or acting in any way whatsoever to procure, encourage or facilitate a trespass to their hotels and contents (as added by the amendment) at Kyrenia, Cyprus, or in any way acting so as to procure by themselves or others the unauthorised use of the plaintiffs' property.

The original writ, with the amendments as underlined, was as follows: "1. The first and second named plaintiffs are companies incorporated according to the law of the Republic of Cyprus, and they are and were at all material times the owners and proprietors of, respectively, the Hesperides Hotel and the Dome Hotel at Kyrenia, Cyprus, and all the furniture, fittings and effects in the said hotels in August 1974 (hereinafter called 'contents'), and are entitled to immediate possession of both the hotels and contents. 2. The first defendants are travel agents and tour operators and carry on business at 10, South Molton Street, London, W.1. The second defendant is the London representative of the self-styled Turkish Federated State of Cyprus ('T.F.S.C.'). 3. During July 1974, armed forces from the Republic of Turkey invaded the northern part of the Republic of Cyprus, and by August 16, 1974, occupied approximately 40 per cent. of the northern part of the Republic of Cyprus (hereinafter called 'the occupied area'). The occupied area has since then been occupied continuously by the armed forces and has been under the de facto but illegal control of the self-styled T.F.S.C. 4. The Hesperides and Dome Hotels at Kyrenia are within the occupied area. In or about the middle of August 1974 the plaintiffs, their servants or agents, were forced to flee from and/or were deprived of all access to the said hotels and contents and the plaintiffs have consequently lost control and possession of the said hotels and contents.5. Since August 1974, the hotels and contents have been illegally occupied, used and managed by trespassers, and the name of the Hesperides has been unlawfully changed to the 'Kyrenia Rocks'. 6. Since at least June 1976 (if not earlier) to the date hereof the first defendants and the second defendant have conspired together, and with others unknown, to effect trespasses to the hotels, and or have conspired together as aforesaid to obtain advantage for themselves by the unauthorised use of the plaintiffs' property."

Particulars

"(i) At all material times the first defendants have had in their possession a brochure or brochures issued by the so-called T.F.S.C., and headed 'Hotels 1976,' which advertises hotels in the occupied area and in particular the 'Kyrenia Rocks.' (ii) On frequent occasions which the plaintiffs are unable to specify, save as appears hereafter, until after the administration of interrogatories and/or discovery herein, the first defendants have held themselves out as willing to book, alternatively have booked, holidays for the clients at the said hotels. ... (iii) ... the second defendant his servants or agents have counselled and procured divers persons to commit trespass to the plaintiffs' hotels and contentsand have encouraged and advertised the facilities for effecting such trespasses. At all material times the said [travel] office has had in its possession and has frequently distributed copies of a brochure headed ' Hotels 1976', containing and advertising the plaintiffs' hotels. Further the office has distributed a coloured brochure advertising holidays in the so-called T.F.S.C. (iv) On or about June 8, 1976, one Sermet, the servant or agent of the second defendant distributed at the office three brochures, with a view to procuring a trespass to hotels in the occupied area including the plaintiffs'. Further he recommended Cyprus/Turkish Airlines as a source of useful information and assistance in arranging holidays in the occupied area. ... (v) On or about August 20, 1976, the second defendant his servant or agent gave advice and information ... as to holidays to be taken in the occupied area. On ... the aforesaid occasions the second defendant by his servants or agents has acted, well knowing that such use of the hotels and contentswas unauthorised, and he did so for his own advantage.

"7. By reason of the aforesaid the plaintiffs have suffered and will suffer damage. ..."

On April 6, 1977, May J., on an interlocutory application in chambers, ordered and directed that the second defendant, Omer Faik Muftizade by himself, his agents or servants or howsoever otherwise be restrained and an injunction granted restraining him from conspiring or acting in any way whatever to procure, encourage or assist a trespass to the plaintiffs' hotels, until after the trial of the action or until further order; but he granted the second defendant leave to appeal.

The defendant Muftizade appealed, asking that the injunction be discharged and the writ in the action be set aside as against him. The grounds of the appeal were that (1) the court had no jurisdiction to entertain the plaintiffs' action as against the second defendant since the statement of claim, both in its unamended and amended form, disclosed no reasonable cause of action and/or the action was an abuse of the process of the court; (2) there was no evidence that the second defendant had committed or had threatened to commit any tort as against the plaintiffs, and the judge misdirected himself in finding to the contrary; and (3) if, contrary to (1) above, jurisdiction existed, the court ought not in the exercise of its discretion to grant interlocutory relief in the special circumstances of the case; and/or the grant of such relief by the judge was wrong in principle.

By a respondents' notice the plaintiffs gave notice that they intended on

the hearing of the appeal to contend that the order of the judge should be affirmed on the grounds additional to those relied on by the court below, namely that (1) the court had jurisdiction to entertain the plaintiffs' claim against the second defendant (a) because the ratio decidendi of British South Africa Co. v. Companhia de Mocambique [1893] A.C. 602 had no application in a suit where title to land situate abroad was not in dispute and the claim was for damages for trespass to the land and the defendant was within the jurisdiction; (b) because the ratio decidendi of the case had no application in a suit where an investigation or issue as to title to land situate abroad arose incidentally; (c) because the ratio decidendi of the case had no application in a suit where the defendant in the action had acted unconscionably; and (d) because there was no other forum in which the plaintiffs' claim against the second defendant could have been brought.

Patrick Neill Q.C. and Gerald Davies for the defendant Muftizade. The judge ought not to have granted the injunction and should have set the writ aside, for though the claim is dressed up as a claim for the tort of conspiracy within the jurisdiction to secure or encourage a trespass to the plaintiffs' hotel in Kyrenia, it is in substance a claim for relief against trespass to foreign land. On the principle laid down in British South Africa Co. v. Companhia de Mo�ambique [1893] A.C. 602, on which is founded the first proposition in rule 79 of Dicey & Morris, The Conflict of Laws, 9th ed. (1973), p. 516, such a claim is not justiciable in our courts; and the plaintiffs cannot bring their claim within any of the exceptions to rule 79. [Reference was also made to Deschamps v. Miller [1908] 1 Ch. 856, 863, and St. Pierre v. South American Stores (Gath and Chaves) Ltd. [1936] 1 K B. 382, 396.] Nor can they get round the principle in the Mo�ambique decision [1893] A.C. 602, by dressing up the claim as a claim in tort against persons within the jurisdiction. There is some authority that the English court would entertain a claim for trespass to chattels in a foreign land but that is not pleaded here.

Kemp Q.C. for the plaintiffs. That point is to be raised by an amendment to the pleadings, for which leave is not required, claiming relief for trespass to the contents of the hotels.

Neill Q.C. continuing. That will not help the plaintiffs, for an action for trespass to goods will not lie where the plaintiffs were not in possession of the goods at the date of the alleged trespass. The plaintiffs seek to escape the ratio of the Mo�ambique decision [1893] A.C. 602 by saying that it has no application in a suit where title to land situate abroad is not in dispute and the issue as to title arises only incidentally since their claim is for damages for trespass to the land by a conspiracy to which this defendant is a party. The English courts will not allow an attempt to get round the rule by such a method. [Reference was made to Marrinan v. Vibart [1963] 1 Q.B. 234, per Salmon J., affirmed by the Court of Appeal [1963] 1 Q.B. 528; Ward v. Lewis [1955] 1 W.L.R. 9, 11, per Denning L.J.; Winfield and Jolowicz on Tort, 9th ed. (1971), footnote 10; and Clerk & Lindsell on Torts. 14th ed. (1975), paras. 1318, 1359.]

The evidence relied on as constituting the alleged conspiracy is, so far as this defendant is concerned. non-existent. The parties to the conspiracy

were said to be Muftizade and the travel agents by encouraging people to book holidays in the plaintiffs' hotels in Kyrenia; but the staff who handed out the brochures were not the servants or agents of this defendant; they were employees of the T.F.S.C. This defendant has done nothing which makes him a tortfeasor as against the plaintiffs.

Further, though the judge had the Foreign Office certificate that H.M. Government does not recognise the T.F.S.C. either de jure or de facto and recognises only the Government of the Republic of Cyprus set up in 1960 under the Cyprus Act, the defendant now seeks leave to adduce further evidence on the situation, both internal and international, of the island since the collapse of constitutional government. This evidence makes it clear that the 1960 constitution has been displaced; that there are in existence autonomous Turkish-Cypriot and Greek-Cypriot administrations in effective control in the north and the south; and that in the north rights in relation to property there are being regulated according to the law administered by the Turkish-Cypriot administration. The plaintiffs' hotels have been requisitioned and let on leases for tourist purposes so that the use or possession of the hotels by persons authorised by the de facto administration of the T.F.S.C. is not actionable in northern Cyprus, but is done lawfully. Though the admission of this evidence involves looking behind the Foreign Office certificate, the court does look at such material where it is necessary to do so. [Reference was made to In re James (An Insolvent) (Attorney-General intervening) [1977] Ch. 41; Bird v. O'Neal [1960] A.C. 907; Swiss Israel Trade Bank v. Government of Salta [1972] 1 Lloyd's Rep. 497; Aksionairnoye Obschestvo A. M. Luther v. James Sagor and Co. [1921] 1 K.B. 456; Government of the Republic of Spain v. S.S. Arantzazu Mendi (The Arantzazu Mendi) [1939] A.C. 256 and Torquay Hotel Co. Ltd. v. Cousins [1969] 2 Ch. 106.] In Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1967] 1 A.C. 853, the House of Lords said that it was still an open question whether for some purposes effect could be given to certain acts of an unrecognised government: see per Lord Wilberforce at p. 954.

[The court received the fresh evidence de bene esse despite objection on behalf of the plaintiffs.]

The fresh evidence shows that even if there were any tort of trespass to foreign land of which the English court could take notice the plaintiffs would be unable to satisfy the second of the conditions in Phillips v. Eyre (1870) L.R. 6 Q.B. 1, and rule 178 (1) (b), at p. 938, in Dicey, 9th ed., in that the acts were not actionable in northern Cyprus, the "foreign country" where they were done.

Even if it is wrong to invite the court to look at the Turkish-Cypriot territory as a province within the republic, which the Foreign Office does not recognise, the court should not in the exercise of its discretion have granted an interlocutory injunction in view of the international negotiations on Cyprus now in progress in Vienna backed by the United Nations which may well succeed. In the existing circumstances it would be undesirable for the English court to intervene in the developing situation. An order of this court will not restore the hotels to the persons claiming possession of them in this country. Further, the delay in this case has been such as

would be fatal to a claim for interlocutory relief in any other case. For those reasons the judge should not have granted the injunction and this court should discharge it and set the writ aside as disclosing no cause of action.

Gerald Davies followed.

David Kemp Q.C., George Newman and Kenneth Parker for the plaintiff companies. The case has been presented to this court as though it were an issue between the Greek-Cypriot and the Turkish-Cypriot administrations. It is nothing of the sort. The reality is that two independent companies with an indisputable title to land in Cyprus are suing a tourist company and an individual resident within the jurisdiction of these courts. If the hurdle of the Mocambique decision [1893] A.C. 602 can be overcome, the question is whether the courts in this country can inquire into a conspiracy in England to trespass in northern Cyprus. The basis of the rule in the Mo�ambique case [1893] A.C. 602, is that the English courts will not make an order which is brutum fulmen; but that rule is subject to so many exceptions and has been so much criticised that it has lost much of its force. Where, as here, the plaintiffs have an undisputed title to the hotels and can prove a conspiracy in this country causing damage to them, there is no reason why the English court should not grant relief by way of damages, and also by way of an interlocutory injunction.

Though it is conceded that the plaintiffs were not in possession at the relevant date, nevertheless their title prevails against trespassers, and they are entitled to immediate possession. The fundamental point here is the effect of the Foreign Office certificate showing that Her Majesty's Government does not recognise the Turkish-Cypriot administration; and so long as our government recognises only the Republic of Cyprus set up in 1960 as the de facto and de jure government in the island, the laws and decrees and all acts of the Turkish-Cypriot administration are nullities: see Aksionairnoye Obschestvo A. M. Luther v. James Sagor and Co. [1921] 1 K.B. 456; [1921] 3 K.B. 532. In face of the certificate the court cannot itself make decisions which recognise the acts of autonomous administrations, particularly decrees which dissolve companies or expropriate property. The court should not go behind the Foreign Office certificate. That was the unanimous ratio in this court in Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1965] Ch. 596, expressed by Diplock L.J. at pp. 662-664, which should bind this court against making a finding of a de facto government in the north which would embarrass Her Majesty's Government.

[SCARMAN L.J. The courts are often put into embarrassing situations, but they have to interpret the evidence, as Lord Atkin did fearlessly in The Arantzazu Mendi [1939] A.C. 256 when faced with a delphic declaration from the Foreign Office.]

The delphic utterance was solved by getting information from other people to interpret it. But it is fundamental to the plaintiffs' case, on the point of setting the writ aside, to establish that the laws and acts in northern Cyprus in relation to these hotels are nullities: see Dicey, 9th ed., ch. 23, p. 559. The application of rule 87 to any particular case involves accepting that the courts have never recognised a law or act of the subordinate

body set up by a government not recognised by Her Majesty's Government. Though Lord Reid and Lord Wilberforce in the Carl Zeiss case [1967] 1 A.C. 853, 900, 901, 906 and 954, said that in certain very limited circumstances and to a very limited extent it was still an open question whether such recognition could be given by the courts, it is only open to the House of Lords to answer that question. [Reference was made to Sir Hersch Lauterpacht, Recognition in International Law (1948) ch. 19, pp. 144, 147, 155, and the article by Professor K. Lipstein in (1950) 35 Tr.Gro.Soc. 157, 188.] If the court finds that the laws relied on by the defendant are of no effect, the action becomes an action in tort by two companies damaged by conspiracy between persons in England. The only place where those damaged by this conspiracy can stop it is in this country by obtaining an injunction to prevent tourists from making bookings for holidays in the hotels. Even if the defendant Muftizade did not distribute the brochures himself the evidence is that he did so vicariously. The submission on nullity also goes to this defendant's status.

Once there is a Foreign Office certificate on recognition, the court should not act on the basis of the new evidence received de bene esse without giving the plaintiffs an opportunity to reply to it; to give effect to the acts of a body of lesser status than the recognised government might have the undesirable result of the courts and government speaking with different voices. Though the court in Luther's case [1921] 1 K.B. 456 admitted evidence of a decree of an unrecognised government, it decided that it could not give effect to the decree.

[LORD DENNING M.R. The House of Lords got round the certificate in the Carl Zeiss (No. 2) [1967] 1 A.C. 853. Why should not the court do the same in the present case?]

In Carl Zeiss the House was construing and thereby giving effect to a certificate given by Her Majesty's Government, whereas here any recognition of an autonomous body would be flying in the face of the certificate. What Lord Reid and Lord Wilberforce rebelled against was the artificiality of the position which precluded for all purposes looking at the reality of the situation; but what they said would not apply to the decrees here relied on as relevant to excuse the trespass. Where the new evidence shows a self-styled autonomous body set up in flagrant revolt against the recognised constitution of 1960 the questions are: what law will the English court presume would prevail? And should the court have regard to the extent to which there is a departure from the previous constitutional position? The court does not have to consider the effect of such departures but only whether what has happened is actionable within the second part of the rule in Phillips v. Eyre (1870) L.R. 6 Q.B. 1. The plaintiffs cannot go to the courts in northern Cyprus where they would get no relief; nor can they go to southern Cyprus. They are entitled therefore to say: "Under the law of Cyprus recognised by Her Majesty's Government we have an undisputed right to our property." The court may consider several possibilities: (1) that the autonomous body is not recognised, so that our courts pay no regard to it or its laws; or (2) put further questions to Her Majesty's Government about the present state of affairs; or (3) look at the new evidence and make up its own mind.

But if the last course is chosen the plaintiffs should be given the opportunity to adduce fresh evidence in contradiction.

What the court is being asked to decide is whether there is a conspiracy in this country to damage the plaintiffs. The amended writ now seeks to stop the taking of bookings in this country for holidays in the plaintiffs' hotels; it is a claim for relief for conspiracy to trespass not only to immovable property but also to the contents of the hotel. Though the reason for the Mo�ambique principle [1893] A.C. 602, and rule 79 in Dicey is that the English courts will not make orders which it cannot enforce, our courts have never struck out an action in personam within the jurisdiction where its orders can be enforced; and where there is trespass to chattels abroad the courts here have an undoubted jurisdiction to entertain an action if persons properly within the jurisdiction can be served. [Reference was made to Cheshire's Private International Law, 9th ed. (1974), p. 493 et seq.] Where conspiracy is charged which causes damage the court can investigate title and may grant an injunction, though only the House of Lords could consider whether damages could be given for such trespass. Though it is hoped that the negotiations over Cyprus now taking place in Vienna may result in the plaintiffs getting back their hotels, it would make management difficult if the present occupiers could make use of them under a seven-year lease by giving holidays to English tourists. Damage could be prevented by the grant of an injunction which would prevent tourists leaving this country for the hotels in Kyrenia. If conspiracy is established all that the plaintiffs need show is likelihood of damage and where, as here, interlocutory relief is sought, all the plaintiffs have to show is an arguable case. The claim in conspiracy causing damage in this country by people resident in this country is outside the Mo�ambique policy rule [1893] A.C. 602; and the amended pleadings which include trespass to chattels do disclose a cause of action.

On the assumption that the alleged law of the non-recognised self-styled government has no effect and the Mo�ambique decision is not a bar, the appeal can proceed. There is here a vast conspiracy of persons, including the defendant, Muftizade, with a common purpose - to persuade people to trespass on the plaintiffs' hotels and chattels. The relevant object of the conspiracy is established by Muftizade's own evidence. [Reference was made to Crofter Hand Woven Harris Tweed Co. Ltd. v. Veitch [1942] A.C. 435, 439.] There is a strong arguable case of conspiracy, and on balance of convenience the status quo should be preserved by an injunction until trial of the action. This defendant will suffer no damage, for the hotel is not vested in him. [Reference was made to Gouriet v. Union of Post Office Workers and Others [1977] Q.B. 729.]

Newman following, referred to The Arantzazu Mendi [1939] A.C. 256, per Lord Atkin at p. 263. The plaintiffs are not seeking to exercise their right to possession but only - since they have the title - their right to say how the property should be used. Their cause of action is the commercial exploitation in England by the defendant and others of their property situate abroad, without their consent. The alternative plea is conspiracy and they ask that something shall not be done in this country which would of itself be a trespass to land abroad. All that the court is asked to decide

is whether there has been a tort in this country - an agreement or arrangement for an unlawful purpose. It would be wrong for the court to consider the new evidence, including the suggestions that the 1960 constitution has been abrogated and that the court should have regard to the draft treaty of guarantee now under negotiation at Vienna. If the court accepts the submission that the evolutionary development producing a new constitution is sufficient to enable this court to pay regard to a provisional administration claiming de facto sovereignty, there is nothing more to be said; but it does make the case before this court quite different from that before the judge, where the only question was: is this a tort within the jurisdiction which the court can restrain, or is it affected by the foreign land issue and so caught by the Mo�ambique rule [1893] A.C. 602? Finally, should the court exercise its discretion to grant an injunction? Under the law of Cyprus the legal title of these plaintiffs to the hotels is unblemished until new laws are recognised by Her Majesty's Government. The court's discretion should be exercised by saying that the status quo should be maintained by grant of an interlocutory injunction.

Neill Q.C. in reply referred to King of the Hellenes v. Brostrom (1923) 16 Ll.L.Rep. 167. Even the amended pleading which includes trespass to chattels discloses no reasonable cause of action but is an abuse of the process of the court. Where the court is faced with a constitution which is no longer operative, it should approach the position pragmatically and see what is happening de facto. It is not a case of the sovereign having to recognise the autonomous administration of T.F.S.C. as a fellow sovereign: see Dr. Lipstein's article (1950) 35 Tr.Gro.Soc., at p. 169; O'Connell, International Law, 2nd ed. (1970), Vol. 2, Ch. 6, pp. 166 and 172, suggesting that Luther's case [1921] 3 K.B. 532 should not now le be strictly aplied; and Dr. F. A. Mann's article on the Judiciary and Executive in Foreign Affairs (1943) 29 Tr.Gro.Soc., p. 143, criticising Luther v. Sagor.

The court does not at this interlocutory stage have to reach any conclusion on the plaintiffs' main point - that this court should not recognise any laws of an unrecognised government - or on the alternative submission for the defendant that there are in fact here two administrations and two systems of law. Further, the policy reasons which seemed sound to the House of Lords in the Mo�ambique case [1893] A.C. 602, cannot be upset on an interlocutory appeal to this court.

Neither the original statement of claim nor the amended claim discloses any reasonable cause of action. The implied suggestion that if the injunction were granted it would be a useful bargaining weapon in the international negotiations in Vienna is quite improper. Nor should leave to amend the pleadings further to allege conversion be given. The injunction should be discharged and the writ set aside.

May 23. The following judgments were read.

LORD DENNING M.R. Cyprus is an island torn with dissension. On the northern coast there is the town of Kyrenia which attracts many

visitors. Two hotels there concern us today. One used to be called the Hesperides Hotel, but now it is the Kyrenia Rocks Hotel. The other was called, and still is called, the Dome Hotel.

Before 1974 these two hotels were owned by Greek Cypriots. The Hesperides was owned by Hesperides Hotels Ltd., a Cyprus company, of which Mr. and Mrs. Kariolou were the sole directors and shareholders. They and their family lived there and ran the hotel. The Dome was owned by Catsellis Hotels Ltd., another Cyprus company, of which Mr. Catsellis was the sole director and shareholder. He and his family lived there and ran the hotel.

In July 1974 the Turkish armed forces landed and took possession of Kyrenia. Many of the Greek Cypriot families fled. They went to the southern part of the island. The two families who owned these hotels went to Limassol, where they still are. They were unable to return to the north. It was sealed off by the Turkish occupying forces.

In the middle of 1976 these families got to know that the hotels had been occupied by Turkish Cypriots. These hotels were advertising in England for visitors. Brochures were issued by a body calling itself the Turkish Federated State of Cyprus with coloured photographs. The Kyrenia Rocks Hotel (formerly the Hesperides) was classified as three-star and described as "This sea-front hotel in the centre of Kyrenia has a swimming pool, 46 rooms and 88 beds."The Dome Hotel was classified as four-star with 170 rooms and 305 beds.

Those brochures were handled in London by a travel agency called Aegean Turkish Holidays Ltd. in South Molton Street. They accepted bookings for these two hotels (among others) from holiday makers in England.

The two Greek Cypriot families went to English solicitors who made inquiries and found that the body calling itself the Turkish Federated State of Cyprus had a London representative, Mr. Muftizade, a man of distinction who holds the Queen's Medal for Gallantry. The solicitors assumed that he had been a party to the issue of the brochures, seeing that they were issued by the Turkish Federated State of Cyprus.

The Greek Cypriot companies then decided to take action in England. On February 16, 1977, they issued a writ against the travel agents and Mr. Muftizade asserting that since August 1974 the hotels had been illegally occupied by trespassers and that the defendants had conspired together to effect trespasses and to obtain advantage for themselves by the unauthorised use of the hotels. They applied to the judge in chambers for an injunction. The travel agents submitted to a perpetual injunction. But Mr. Muftizade opposed it and applied to set aside the writ against him. On April 6, 1977, May J. upheld the writ and granted an injunction against Mr. Muftizade "restraining him from conspiring or acting in any way whatever to procure encourage or assist a trespass to the plaintiffs' hotels." Mr. Muftizade now appeals to this court: and we have expedited it especially because of the holiday season now beginning.

The case involves some important points on the conflict of laws. These best appear if I summarise the rival contentions put before us.

Mr. David Kemp, for the two Greek Cypriot companies, said that the

only constitution of Cyprus known to English law is the constitution established on August 16, 1960, pursuant to section 1 of the Cyprus Act 1960: and that the only lawful government is the Republic of Cyprus established by the Act. He said that the plaintiffs, the two Greek Cypriot companies, are the legal owners of these two hotels and have the right to possession of them: and that these legal owners (having found the defendant Mr. Muftizade in England and having served him here) can sue him personally for any personal wrong done by him: and that he is guilty of a personal wrong because he conspired with the travel agents and others to obtain bookings for these hotels: and thus procured, encouraged and assisted trespasses to these hotels - such trespasses being unlawful by the laws of the Republic of Cyprus.

Mr. Patrick Neill for Mr. Muftizade put before us a great deal of material which was not before the judge. He suggested that ,the original constitution of Cyprus had been supplanted in fact by two autonomous administrations. One was a Turkish Cypriot administration in the northern part of the island: the other a Greek Cypriot administration in the southern part of the island. He said that these administrations had each requisitioned properties of individuals. The Turkish Cypriot administration had requisitioned property in the north which formerly belonged to Greek Cypriots there: the Greek Cypriot administration had requisitioned property in the south which had formerly belonged to the Turkish Cypriots there. He said that it was open to argument, at least, that these requisitions were lawful; and that the courts of England could not, and should not, pronounce them unlawful; or issue any injunction on that footing.

The Foreign Office certificate

The Republic of Cyprus was set up by an Act of our Parliament in 1960, the Cyprus Act 1960. It established an "independent sovereign Republic of Cyprus" with its own constitution. That is the only government which has been recognised by Her Majesty's Government as the de jure government of any part of Cyprus. So far as any subsequent administrations are concerned, they have never been recognised de jure or de facto as sovereign states. This is made clear by this certificate of April 6, 1977, issued by the Foreign and Commonwealth Office in response to a request by May J.:

"Her Majesty's Government in the United Kingdom do not recognise the administration established under the name of the 'Turkish Federated State of Cyprus'. ... Her Majesty's Government do not recognise such administration as being the government of an independent de facto sovereign state. Her Majesty's Government do not recognise or accord to Mr. Omer Faik Muftizade the 'London representative of the Turkish Federated State of Cyprus' any privilege or immunity under the Diplomatic Immunities Act 1964."

The effect in law of the certificate

Mr. Kemp submitted that, seeing that the "Turkish Federated State of Cyprus" was not recognised de jure or de facto by Her Majesty's Government, it followed that the courts of this country could not recognise or give

effect to any of the acts or laws of this so-called state. They are all nullities in the eyes of English law, he said, and should be treated as such by the English courts. These courts could not, he said, even receive evidence of the acts and laws made by this so-called state.

Those authorities in favour

Mr. Kemp supported his submission by reference to many authorities of which I will select a few. In Aksionairnoye Obschestvo A. M. Luther v. James Sagor and Co. [1921] 1 K.B. 456, 476 Roche J. accepted the law as stated by the Supreme Court of the United States in 1818:

"No doctrine is better established, than that it belongs exclusively to governments to recognise new states in the revolutions which may occur in the world; and until such recognition, either by our own government, or the government to which the new state belonged, courts of justice are bound to consider the ancient state of things as remaining unaltered."

In Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1965] Ch. 596, 656, Diplock L.J. said:

"The lex loci actus to the consequences of which English courts will give effect is thus limited to laws made by or under the authority of those persons who are recognised by the Government of the United Kingdom as being the sovereign government of the place where the thing happens, and the English courts will not treat the happening as having in England any legal consequences which are claimed to result from a law made by persons who are not recognised as being either the sovereign government of that place or persons authorised by that sovereign government to make laws for that place."

To those judicial statements, Mr. Kemp added most persuasively the book by the late Sir Hersch Lauterpacht Recognition in International Law(1948) and Chapter X on Recognition of Governments where he said at p. 145 et seq.

"... no juridical existence can be attributed to an unrecognised government and ... no legal consequences of its purported factual existence can be admitted. ... The correct and reasonable rule is that both the unrecognised government and its acts are a nullity."

Those authorities against

That doctrine is said to be based on the need for the executive and the courts to speak with one voice. If the executive do not recognise the usurping government, nor should the courts: see Government of the Republic of Spain v. S.S. Arantzazu Mendi (The Arantzazu Mendi) [1939] A.C. 256, 264, by Lord Atkin. But there are those who do not subscribe to that view. They say that there is no need for the executive and the judiciary to speak in unison. The executive is concerned with the external consequences of recognition, vis-ˆ-vis other states. The courts are concerned with the internal consequences of it, vis-ˆ-vis private individuals. So far as the courts are concerned, there are many who hold that the courts are entitled to look at the state of affairs actually existing in a territory, to

see what is the law which is in fact effective and enforced in that territory, and to give such effect to it - in its impact on individuals - as justice and common sense require: provided always that there are no considerations of public policy against it. The most authoritive statement is that of Lord Wilberforce in Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1967] 1 A.C. 853, 954, where he said:

"... where private rights, or acts of everyday occurrence, or perfunctory acts of administration are concerned ... the courts may, in the interests of justice and common sense, where no consideration of public policy to the contrary has to prevail, give recognition to the actual facts or realities found to exist in the territory in question."

That view is supported by an article by Professor K. Lipstein in (1950) 35 Tr.Gro.Soc., 157 which he concludes by saying, at p. 188:

"The regulations of foreign authorities which have not been recognised may be applied as the law of the foreign country if they are in fact enforced in that country, notwithstanding that the authorities have not been recognised by Great Britain."

In the recent case about the illegal regime in Rhodesia I was myself ready to apply the principles stated by Lord Wilberforce. I said in In re lames (An Insolvent) (Attorney-General intervening) [1977] Ch. 41, 62:

"When a lawful sovereign is ousted for the time being by a usurper, the lawful sovereign still remains under a duty to do all he can to preserve law and order within the territory: and, as he can no longer do it himself, he is held to give an implied mandate to his subjects to do what is necessary for the maintenance of law and order rather than expose them to all the disorders of anarchy: ..."

And Scarman L.J. said that he agreed with much of this, adding at p. 70:

"I do think that in an appropriate case our courts will recognise the validity of judicial acts, even though they be the acts of a judge not lawfully appointed or derive ,their authority from an unlawful government."

The choice

If it were necessary to make a choice between these conflicting doctrines, I would unhesitatingly hold that the courts of this country can recognise the laws or acts of a body which is in effective control of a territory even though it has not been recognised by Her Majesty's Government de jure or de facto: at any rate, in regard to the laws which regulate the day to day affairs of the people, such as their marriages, their divorces, their leases, their occupations, and so forth: and furthermore that the courts can receive evidence of the state of affairs so as to see whether the body is in effective control or not.

The factual position in Cyprus

I turn therefore to look at the factual position as it has developed during the last three years.

(i) Generally

In 1960 there were Greek and Turkish Cypriots living in all parts of the island, but with more Turkish Cypriots in the north than in the south; and vice versa. The 1960 Constitution provided for a central government, with a legislature, judiciary and public service - in all of which both communities were represented.

In 1960 too, there was a Treaty of Guarantee whereby Greece, Turkey and the United Kingdom guaranteed the independence, territorial integrity and security of the Republic of Cyprus and also the state of affairs established by the Basic Articles of the Constitution. In the event of a breach, each of these guaranteeing powers reserved the right to take action with the sole aim of re-establishing the state of affairs enacted by the Treaty.

In 1963 there were serious disturbances between the two communities followed by the stationing of a United Nations peace-keeping force in Cyprus. The story is told in Nissan v. Attorney General [1968] 1 Q.B. 286 and [1970] A.C. 179. The two communities no longer participated jointly in the government of the country. The executive and House of Representatives were composed of Greek Cypriots alone and not Turkish. An account is given in the Reports of the Secretary-General of the United Nations of September 10, 1964, and July 29, 1965.

In December 1967 the Turkish Cypriot community formed its own administration. It set up its own legislature, executive council, and judiciary.

In July 1974 there was an emergency which led Turkey to land armed forces on the island. She sought to justify her conduct by the Treaty of Guarantee. The Security Council met and expressed its grave concern about the situation and its equal concern "about the necessity to restore the constitutional structure of the Republic of Cyprus."

On July 30, 1974, the foreign ministers of Greece, Turkey and the United Kingdom met at Geneva and made a declaration calling for a cease-fire and agreed that negotiations should be carried on without delay. The declaration contained this significant statement:

"The Ministers noted the existence in practice in the Republic of Cyprus of the autonomous administrations, that of the Greek Cypriot community and that of the Turkish Cypriot community."

Later, on November 1, 1974, the General Assembly of the United Nations commenced the negotiations between the representatives of the two communities and called for them to find a "mutually political settlement."

Ever since 1974 there have been two separate autonomous administrations. There has been a vast movement of population with the result that the northern part is inhabited by Turkish Cypriots: and the southern part by Greek Cypriots: with little or no communication between the two.

On February 13, 1975, the Turkish Federated State of Cyprus enacted a constitution on the pattern of an independent state with a legislature, an executive and a judiciary. Thereafter its Constituent Assembly passed laws relating to the property of foreign nationals, giving power to requisition such property and so forth.

Negotiations have been proceeding under the auspices of the United

Nations. Talks have been going on in Vienna. The latest guide-lines set down in April 1977 are to aim at "an independent, non-aligned, bi-communal Federal Republic". If these negotiations succeed, each of the two parts will be separate states within a federation. Provision would be made, I should think, to validate much that has been done by the two administrations in the past, to provide for compensation to be made to those whose property has been taken or requisitioned, and so forth.

(ii) Specifically

In April 1975, under legislative authority, the Cyprus Turkish Tourism Enterprises Co. Ltd. let the Hesperides Hotel with its contents to a lessee, Mr. Izzet Mustaf, for seven years from April 15, 1975, to April 15, 1982, at a progressive rent. The lessee agreed to occupy and run the hotel for tourist purposes as approved by the company: and to do repairs and so forth. The lease contained an express provision:

"... the company is entitled to require the lessee to give up possession forthwith, in order to enable the Turkish Federated State of Cyprus to meet any claim made in accordance with international agreement. ..."

On September 11, 1975, under the legislation authorising requisition of property, it would appear that the Dome Hotel was requisitioned, but we have no details of this.

(iii) Summary

The evidence points clearly to there being two autonomous administrations in Cyprus. Many of the Greek Cypriots in the north have fled to the south, abandoning their properties which have been taken over by the new Turkish Cypriot administration. Vice versa the Turkish Cypriots in the south have fled to the north abandoning their properties which have been taken over by the autonomous administration of the south. Negotiations are in progress for a bi-communal federal state. If these succeed, provision will no doubt be made for the properties to be restored to their former owners or compensation paid. Meanwhile, however, under the laws purported to be made by the respective administrations, the properties have been let and occupied by persons authorised by the relevant administrations but not with the authority of the former owners.

A hypothetical state of affairs

As Mr. Kemp's argument proceeded, it became plain that he would have us regard this case as if there had been no political disturbances in Cyprus in recent years. That is, as if it had continued as a stable country under a single administration. He invited us to consider several hypothetical cases to test the position. I will elaborate on them just to see what the position is. Imagine that a gang of thieves had broken into the Hesperides Hotel, handcuffed the proprietors, and occupied it for a while, stolen the money and jewellery from the safe, smashed up the place, escaped to England, spent some of the money on extravagant living, and lodged the rest of it and the jewellery in a bank in London. If the true owners had followed the thieves to England and had sued them here for damages - seeking

also to recover the money and jewellery from the bank - would the English courts have entertained the action? I would say certainly they would. The English courts would have awarded damages at any rate for all the injuries to person and damage to chattels and conversion of them. So much is clear from the opinion of the judges in 1666 in Skinner v. East India Co. (1666) 6 St.Tr. 710, 719 and the decision of Lord Mansfield 100 years later in 1774 in the great case of Mostyn v. Fabrigas, 1 Smith's L.C. 642. But what about the damage done to the hotel itself, smashed up as it was? I see no reason at all why the English courts should not have jurisdiction to award damages for trespass to land also against the wrongdoers. Some people seem to think the contrary, basing themselves on what was said in the House of Lords in British South Africa Company v. Companhia de Mo�ambique [1893] A.C. 602. But in that case there was a disputed claim of title to foreign land. And it is at least arguable that the decision in the Mo�ambique case [1893] A.C. 602 should be confined to cases where there is a genuine issue as to title: see The Tolten [1946] P. 135, 141 by Scott L.J. It should not be extended to cases where no issue as to title is raised or can genuinely be raised.

Now to carry my hypothetical case one stage further. Suppose some of the gang go into hiding in Cyprus and the others escape to England: and then they plot together to carry out another raid in Cyprus: and those in England arrange to despatch money or means to their confederates in Cyprus to help in the scheme: and have actually loaded some of it on a van ready for Heathrow Airport: and then the plot is discovered. I should think it plain that the English courts would have jurisdiction to grant an injunction against those who can be served in England, basing it on a conspiracy in England to do an unlawful act abroad.

That is, of course, an extreme hypothesis. But it illustrates the very principle which Mr Kemp seeks to invoke here. He says that the defendant is here and is taking part in a conspiracy to commit trespasses in Cyprus.

The real state of affairs

The real state of affairs is, however, very different. There is an effective administration in North Cyprus which has made laws governing the day to day lives of the people. According to these laws, the people who have occupied these hotels in Kyrenia are not trespassers. They are not occupying them unlawfully. They are occupying them by virtue of a lease granted to them under the laws or by virtue of requisitions made by the existing administration. If an action were brought in the courts of this northern part - alleging a trespass to land or to goods - it would be bound to fail. It follows inexorably that their conduct cannot be made the subject of a suit in England. Even if any of the present occupiers himself came to England and was sued here, the court would be bound to reject the claim. The case would fail because, in order to be actionable in England, it would have to satisfy the second of the conditions as laid down in Phillips v. Eyre (1870) L.R. 6 Q.B. 1, 29: "the act must not have been justifiable by the law of the place where it was done." Nor would it satisfy the conclusion in Dicey & Morris, Conflict of Laws, 9th ed. (1973) rule 178 (1) (b), that it must be "actionable according to the law of the foreign country where it

was done."Nor would it satisfy Lord Wilberforce's test in Boys v. Chaplin [1971] A.C. 356, 389. He said that an action would not lie in England if "civil liability does not exist, or is excluded, under the law of the place where the wrong was committed".

Nor is the case made any better by being framed in conspiracy. If the acts in Kyrenia are not actionable here, nor is an agreement beforehand: see Marrinan v. Vibart [1963] 1 Q.B. 234; [1963] 1 Q.B. 528. As I said in Ward v. Lewis [1955] 1 W.L.R. 9, 11, it is often sought to get an added advantage by suing in conspiracy so as to overcome substantive rules of law. That is not permitted. The substantive law says that no action lies here for the trespass to the hotels or their contents in Kyrenia. The plaintiffs cannot overcome this rule or the substantive law by dressing it up as a conspiracy here to commit trespass there.

The amendment

During the argument Mr. Kemp realised that the decision of the House of Lords in the Mo�ambique case [1893] A.C. 602 was against him. It appeared to be a conclusive authority that an action could not be brought in England for trespass to foreign land. So he sought to amend so as to allege a trespass to goods, that is, to the contents of the hotels - which would not be defeated by the Mocambique case. So framed, he suggested that the action could not be struck out.

To my mind, however, even if this amendment were allowed, Mr. Kemp does not overcome the difficulty presented to him by Phillips v. Eyre (1870) L.R. 6 Q.B. 1. The trespasses to these hotels, both to the land and the contents, were not actionable according to the law then in force at that place. So they are not actionable in England. Nor is the alleged conspiracy actionable: because if the alleged trespass is not actionable, a conspiracy also is not actionable.

Conclusion

Although this case has involved much discussion on many points, I think it could be disposed of on a broad ground of public policy. Underlying this case is a divergence of view between two autonomous administrations in Cyprus. The northern administration sets itself up as an administration entitled to pass laws requisitioning this property. The southern administration denies the claim and says that the requisitioning was unlawful. It is not the province of these courts to resolve such a dispute. It is a dispute which should be settled by negotiation between the two administrations, aided, we hope, by intermediaries of good will. It is indeed, we hope, being settled at this very moment by negotiations in Vienna. If a settlement is reached it should deal with all questions relating to the taking of property, compensation and so forth. But, whether it is settled or not, it is not for these courts to decide between these conflicting views. The dispute, in my view, is not justiciable here. The action should be struck out as not sustainable. I would allow the appeal accordingly.

ROSKILL L.J. The plaintiffs seek and have obtained from May J. an interlocutory injunction against the appellant - the second defendant - restraining

him from "conspiring or acting in any way whatever to procure encourage or assist a trespass" to two hotels respectively owned by the plaintiffs in Kyrenia in northern Cyprus in the area presently occupied by the Turkish regime. The judge not only granted the plaintiffs that injunction but dismissed an application by the second defendant to set aside the plaintiffs' writ for want of jurisdiction. The judge's order does not - as I venture to think it should - specify the person or persons from conspiring with whom the second defendant is thus enjoined. But when one looks at the statement of claim in its unamended form it is clear that the principal allegation was that he had conspired and would unless restrained conspire with the first defendant, an English limited company carrying on business in London as travel agents. There was also an allegation of conspiracy between the second defendant and persons unknown. The first defendants have submitted to an injunction and have consented to payment of a small sum of damages to each of the plaintiffs. That followed from a consent order made by Pain J. on May 13, 1977. It is not necessary in this judgment to consider whether there was jurisdiction to grant that injunction, even by consent, though Mr. Neill for the second defendant submitted there was not. That consent order - whether rightly or wrongly made - cannot affect the position of the second defendant. He is the London representative of a body styled the Turkish Federated State of Cyprus. Since no recognition is accorded to that body by Her Majesty as the de jure government of any part of Cyprus or as the government of an independent de facto sovereign state - see the Secretary of State's letter of April 6, 1977 - it follows that the second defendant is sued as a private individual and indeed cannot be sued otherwise or in any relevant representative capacity. He does not possess and in this court does not claim to possess any diplomatic privilege or immunity. Nor indeed has he any official status accorded to him, though it should be said in fairness to the respondents' advisers and to the judge that the affidavit sworn by the second defendant on March 25, 1977, comes near to claiming some degree of official recognition for himself. If therefore the plaintiffs are to succeed in their claim against the second defendant they must prove that claim just as any claim for damages for conspiracy to trespass must be proved by any plaintiff against any other defendant, and if that claim falls within a class which the courts of this country have no jurisdiction to entertain, not only ought the interlocutory injunction sought and granted to be discharged but the writ should itself be set aside.

The second defendant seeks to have the writ set aside on the ground that the English courts have no jurisdiction to entertain this claim on the ground that however the claim may be dressed up in the unamended statement of claim, it offends against the principle of English law summarised in rule 79 of Dicey & Morris, Conflict of Laws, 9th ed. (1973). Rule 79 is stated:

"Subject to the exceptions hereinafter mentioned, the court has no jurisdiction to entertain an action for (1) the determination of the title to, or the right to possession of, any immovable situate out of England (foreign land); or (2) the recovery of damages for trespass to such immovable."

That rule, as appears from the relevant footnote, is founded on the decision

of the House of Lords in British South Africa Co. v. Companhia de Mo�ambique [1893] A.C. 602. If this submission be right, it must follow that both the writ should be set aside and the interlocutory injunction in question ought not to have been granted. The judge did not have before him the evidence from the second defendant and others in Part III of the record, for the adducing of which we gave leave. Had he done so, he would not, I think, have felt able to hold as unhesitatingly as the revised note of his most careful judgment shows him to have done, that the evidence showed an unlawful conspiracy between the first defendant and the second defendant to procure a trespass to the plaintiffs' property in Cyprus. For my part, now that all the evidence is available, I think it right to say that I can see very little evidence of the conspiracy alleged against the second defendant personally and in so far as such conspiracy is alleged to be by persons for whom he is vicariously responsible, I can see no evidence of any tortious act by anyone for whom he can reasonably be said to be vicariously responsible. To suggest, as did Mr. Kemp at one point in his argument, that the second defendant is "one member of a vast conspiracy" is to my mind quite unwarranted and the language of exaggeration.

In truth, as Mr. Newman, the respondents' junior counsel, in an argument for which I would express my gratitude and which loses none of its merit by its lack of success, said, the case for the second defendant in this court bears little, if any, resemblance to the submissions advanced on his behalf before May J.

But Mr. Neill on behalf of the second defendant was reluctant that the appeal should succeed on this ground alone - very understandably, as I think, lest fresh proceedings should be started against some other alleged tortfeasor against whom perhaps some evidence could be found at least sufficient to obtain an interlocutory injunction if jurisdiction existed in the English courts to grant such an injunction. I will therefore assume, though I certainly do not accept, that there is for the plaintiffs' present purposes sufficient evidence against the second defendant of conspiracy in this country to trespass against the plaintiffs' hotels in North Cyprus. Mr. Neill was concerned to succeed upon principle, the main submission being that, however the claim might be dressed up as one for damages for conspiracy to trespass, the pleaded claim when analysed offended against what for the sake of brevity and with sufficient accuracy I will call the Mo�ambique principle. That this principle - at any rate in its widest form - has been criticised by writers of distinction is undoubted. But that it is correctly stated in rule 79 of Dicey & Morris seems to me to be equally undoubted. That the rule is subject to certain exceptions is clear. But that does not mean that the rule has, as Mr. Kemp submitted, been so far eroded as to cease to be a rule. The judge appears to have thought that the rule was in effect limited to cases where the title to land was not in dispute and the cause of action was "in truth the recovery of damages for trespass." With respect, while it is the fact that the plaintiffs' title to their hotels is not in dispute, their right to immediate possession of the hotels is strongly disputed by the second defendant and it must, as a matter of English law, be an essential prerequisite of their right

to recover damages for the alleged conspiracy to trespass that they show that the acts relied upon as constituting the alleged conspiracy and as causing the alleged damage are actionable. Mr. Kemp put in the forefront of his submissions that this was not a matter which this court could investigate because the only ground on which the plaintiffs' claim to immediate possession could be defeated depended on alleged laws and actions of the so-called Turkish Federated State of Cyprus and that since no recognition had been accorded by Her Majesty to that body, those so-called laws and actions were nullities to which no effect must be given in our courts. At one point he even objected to our looking at the evidence of those laws and actions as being inadmissible.

I will consider hereafter the submission that our courts cannot pay any regard to or give any effect to these so-called laws and actions as being in the absence of recognition nullities. But even if this were so, it cannot affect the character of the claim for damages which the plaintiffs have advanced against the second defendant. If the claim for damages be one which this court has in principle no jurisdiction to entertain, then this court cannot acquire jurisdiction to entertain it merely because if jurisdiction did exist there would be no defence to the claim.

I understood Mr. Kemp to accept that he could not maintain that if the plaintiffs' action had been limited to one for damages for ,trespass to their properties in Cyprus, this court could entertain that claim. But he contended that because the action was founded in conspiracy to trespass the position was different, at least where the overt acts of the conspiracy took place in this country, even though the damage alleged might be suffered abroad. Mr. Newman additionally contended that there was sufficient evidence of damage to the plaintiffs here by the mere making of a booking at these hotels which the plaintiffs had not authorised. Both Mr. Kemp and Mr. Newman argued that since there was, as I am assuming to be the case for this purpose, sufficient evidence of the relevant tortious acts by the second defendant within the jurisdiction and since he was present within the jurisdiction there was no reason in principle why the English courts should not exercise jurisdiction in personam against him and thus prevent the continuance of the alleged conspiracy to trespass against their property. It was said that nothing in the Mo�ambique principle [1893] A.C. 602 prevented this court so acting. It was said that the policy underlying that decision was simply that the English courts would not make orders which they could not enforce, the brutum fulmen principle. Here it was said that the relevant order could be enforced against the second defendant personally because he was within the jurisdiction and there was no reason why therefore it should not be made, and, if necessary, enforced against him.

With respect, this seems to me to be the very argument which failed in the House of Lords in the Mo�ambique case [1893] A.C. 602 though it was favoured by two members of this court whose judgments were reversed by their Lordships' House. If one looks at the argument of Sir Henry James Q.C. in the Mo�ambique case [1893] A.C. 602, 611 and 612 it reads:

"There is no want of jurisdiction, and the difficulty of procedure is removed where there is a defendant domiciled in this country against whom judgment can be enforced. The mere circumstance that the

subject-matter of the action is abroad does not take away the jurisdiction ..."

This was the very argument which the House rejected: see the speech of Lord Herschell L.C. at pp. 624 and 625. Lord Herschell said:

"It was admitted in the present case, ... that the court could not make a declaration of title, or grant an injunction to restrain trespasses, the respondents having in relation to these matters abandoned their appeal in the court below. But it is said that the court may inquire into the title, and, if the plaintiffs and not the defendants are found to have the better title, may award damages for the trespass committed. My Lords, I find it difficult to see why this distinction should be drawn. It is said, because the courts have no power to enforce their judgment by any dealing with the land itself, where it is outside their territorial jurisdiction. But if they can determine the title to it and compel the payment of damages founded upon such determination, why should not they equally proceed in personam against a person who, in spite of that determination, insists on disturbing one who has been found by the court to be the owner of the property?"

He continued on p. 625:

"But there appear to me, I confess, to be solid reasons why the courts of this country should, in common with those of most other nations, have refused to adjudicate upon claims of title to foreign land in proceedings founded on an alleged invasion of the proprietary rights attached to it, and to award damages founded on that adjudication."

It is true that, so far as appears from the report, there was no allegation in that case against the appellants of conspiracy. But in principle I find it impossible to see how, if, as seems clearly to be the position, our courts have no jurisdiction to entertain an action in respect of a trespass committed against land abroad, jurisdiction is suddenly acquired by dressing the claim up as an alleged unlawful agreement between two or more people in this country to commit that trespass abroad. Further, so far as more recent authority is concerned, the submission that the difficulty can be overcome by framing the claim as one for conspiracy to trespass seems contrary to the view of this court in Ward v. Lewis [1955] 1 W.L.R. 9, and of Salmon J. and of this court in Marrinan v. Vibart [1963] 1 Q.B. 234 and [1963] 1 Q.B. 528. In my view so easy an escape route from the bonds of the Mo�ambique principle is not available to the plaintiffs in this case.

It follows that in my judgment the Mo�ambique principle presents a complete bar to the plaintiffs' claim as framed in the unamended writ and that their claim for damages for conspiracy to trespass cannot be entertained in our courts. I would allow this appeal on that ground alone, discharge the injunction, and set aside the writ.

But I would venture to add this. Mr. Neill read us from the evidence one version of the recent events in Cyprus. The plaintiffs have not had the opportunity of answering that evidence and, no doubt, had they had that opportunity, much could and would have been said on the other side. History, especially recent controversial political history, is not one-sided. All

I would say about the evidence in volume III so far as it goes is that it shows the profound wisdom of the Mo�ambique principle. The position in Cyprus, both on the Greek and on the Turkish side, is at the present juncture evolutionary and continues to evolve and develop. Delicate international negotiations have taken place and are about to continue. In those circumstances, for an English court to arrogate to itself the right at this juncture to determine questions of the right to possession of land in Cyprus by entertaining an action for conspiracy to trespass is something which in my view it ought not to do. Even if I am wrong in the view that the Mo�ambique principle applies, and even if I thought that our courts had jurisdiction and therefore a discretion whether or not to grant the injunction sought, in accordance with the principles recently laid down by the House of Lords in American Cyanamid v. Ethicon Ltd. [1975] A.C. 396, I would not hesitate in the existing circumstances to exercise my discretion against granting the injunction sought.

In these circumstances it becomes unnecessary to deal with the other main branch of Mr. Neill's argument. Out of deference to that argument would, however, make a few comments upon it. The argument was this. Looking at the evidence contained in volume III, it was contended that it was on any view impossible for the plaintiffs to make good their cause of action because in order to do so they had to show not merely that the acts complained of were actionable in this country, but also that they were actionable in Cyprus: see Phillips v. Eyre (1870) L.R. 6 Q.B. 1. This, it was said, they could not do in accordance with the relevant law of Cyprus because that relevant law was that now prevailing in that part of Cyprus presently under Turkish control. Mr. Neill claimed in the light of the evidence in volume III that by the law now prevailing there, the loss of possession of which the plaintiffs complained in this action was lawful. Therefore, he argued, their claim must fail since the acts complained of could not be shown to be unlawful both by the law of this country and by the relevant law prevailing in Cyprus. He further argued that our courts would not refuse to recognise or give effect to those laws simply because, as I have already pointed out, recognition has not been accorded by Her Majesty to the Turkish regime in North Cyprus. Mr. Neill referred to rule 87 in Dicey & Morris, Conflict of Laws and in particular to the commentary upon that rule at pp. 559 and 560. The most relevant sentence in the commentary, at p. 560, is:

"However there is high authority for regarding as open the question whether the courts can recognise the laws or acts of a body which although it does not satisfy either of the foregoing tests" (those tests being concerned with recognition) "is nonetheless in effective control of the place in question."

Reliance is placed for that last sentence which I have quoted upon the decision of the House of Lords in Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1967] 1 A.C. 853, as well as upon an article by Professor Lipstein in (1950) 35 Tr.Gro.Soc. 157 to which we were referred. Mr. Kemp, on the other hand, roundly condemned that sentence as "grossly misleading," claiming support for his submission in the decision of this court in Aksionairnoye Obschestvo A. M. Luther v. James Sagor and

Co. [1921] 3 K.B. 532, as well as in certain academic writings and in the judgment of Diplock L.J. in the Carl Zeiss case [1965] Ch. 596, 655, 656, by which he claimed that this court was bound, notwithstanding that its decision was reversed by the House of Lords. Having regard to the fact that this is an interlocutory appeal, I think it both unnecessary and undesirable to make any observations upon this difficult question of private international law which, in my view, does not arise for decision. I would only say this. First, with all respect to Mr. Kemp's argument, I do not think that the submission that we are bound by that judgment of Diplock L.J. is tenable. Secondly, as Mr. Neill pointed out in reply, whether the view of Diplock L.J. be right or be wrong, he was extremely careful expressly to except from his observations what he described as the anomalous rule as to the legal consequences in England of torts committed abroad: see p. 656. Thirdly, having regard to the observations of their Lordships in the House of Lords in the Carl Zeiss case [1967] 1 A.C. 853, and in particular to those of Lord Reid and Lord Wilberforce, it is clear that at some future date difficult questions may well arise as to the extent to which, notwithstanding the absence of recognition, the English courts will or may recognise and give effect to the laws or acts of a body which is in effective control of a particular area or place. I have already said that even if I were wrong in my view that the Mo�ambique principle operates to bar this claim, I would not exercise my discretion in favour of granting an injunction. The fact that the argument just mentioned is also available to the appellant is a further reason for declining the interim grant of the interlocutory relief sought.

There is only one further matter with which it is necessary to deal. Somewhat belatedly, and claiming to be entitled so to do without leave, Mr. Kemp amended the writ and statement of claim. The purpose of the amendment was to claim damages for conspiracy to trespass not only against the hotels to which I have referred but also their contents. It is important to observe that the amendment does not aver conversion or conspiracy to convert those contents, but simply damages for conspiracy to trespass against them. It is clear that the purpose of this amendment was, if possible, to save the writ from being wholly set aside if the plaintiffs' other arguments failed because this court felt obliged to apply the Mo�ambique principle and thus to hold that there was no jurisdiction to entertain the claim for conspiracy to trespass to land as originally advanced. No doubt the somewhat belated amendment was inspired by the fact that in the Mo�ambique case the action was allowed to continue in so far as it related to chattels and property other than land. There would be a certain logic in holding that if the present action could not be maintained in relation to damages for conspiracy to trespass in respect of the hotels themselves, it ought not to be entertained in relation to the contents of those hotels. Nonetheless in my view the decision in the Mo�ambique case puts difficulties in the way of our accepting that view in this court. But as Mr. Neill was quick to point out in reply, trespass to goods is an interference with possestion of goods, and therefore if the plaintiffs were not in possession of the goods at the date of the alleged trespass or conspiracy to trespass, an action for trespass and therefore for conspiracy to trespass to goods will not lie. As already pointed out, there has been no amendment to aver conversion or

conspiracy to convert. In my view, this point of Mr. Neill, though technical, is unanswerable. Faced with this, Mr. Kemp belatedly sought leave further to amend to allege conversion and conspiracy to convert. For my part, I see no reason why this further indulgence should be granted at this late stage.

In the result, therefore, for the reasons I have given, in my view, with great respect to the judge, he was wrong in refusing to set aside the writ and also wrong in granting the injunction. In fairness to him, however, it must be said, as I have already pointed out, that this case has assumed a very different pattern in this court from that which it assumed before him and if he had had the advantage of the same arguments and the same evidence as we have had, it may very well be that he would have taken a different view from that which he did. I would add that since preparing this judgment I have had the advantage of discussing with Scarman L.J. the judgment which he is about to deliver, and I agree with that judgment.

SCARMAN L.J. I have had the advantage of reading the judgment of Roskill L.J., with which I agree. It is, therefore, unnecessary for me to add to the length of this interlocutory appeal. Nevertheless, as we are differing from the very careful judgment of the judge in chambers, I would wish to give shortly my reasons for doing so.

Mr. Neill for the appellant - the second defendant in the action - came to the Court of Appeal to deal with a claim based on an alleged conspiracy to effect a trespass to land situate abroad. The argument had not proceeded far before Mr. Kemp for the respondents - the plaintiffs in the action - exercised his right to amend without leave (the pleadings not being closed) by adding a claim based on conspiracy to effect a trespass to chattels, namely, the contents of the two hotels. He hoped to achieve by amendment what he might fail to obtain by argument. It is convenient, therefore, first to consider the claim as it was when the judge granted the plaintiffs their interlocutory injunction, and thereafter to consider the amended writ.

The unamended writ

Stripped down to its essentials, the claim originally endorsed on the writ is for damages for conspiracy to effect a trespass to land situate abroad, and for an injunction restraining the second defendant "from conspiring or acting in any way whatever to encourage or assist a trespass" to the plaintiffs' two hotels in Kyrenia, Cyprus. Kyrenia is effectively controlled by a body known as the Turkish Federated State of Cyprus. This body is not recognised by the United Kingdom as an independent sovereign state: but its control of northern Cyprus, supported by the armed forces of the Republic of Turkey, has effectively excluded the two plaintiff companies, their servants or agents, from the possession of the two hotels, the Hesperides owned by the first plaintiff and the Dome owned by the second. The conspiracy alleged is that the second defendant, who claims to be the agent in London of the Turkish Federated State of Cyprus, has agreed with others to promote and encourage the booking of tourists to the hotels.

To meet this case, Mr. Neill for the second defendant submits: (1) that the court has no jurisdiction to entertain the action: he relies on British

South Africa Co. v. Companhia de Mo�ambique [1893] A.C. 602; (2) that, if the case falls outside the Mo�ambique rule (as the judge held), it discloses no cause of action because it is plain on the evidence available to the court that the use or possession of the hotels by others authorised by the de facto administration of the Turkish Federated State of Cyprus but unauthorised by the owners, that is, the plaintiffs, is not actionable in northern Cyprus; indeed, it is, he submits, a governmental act valid and effective by the law of the country where the hotels are situate; (3) that in any event, and in the light of all the evidence, it was a wrong exercise of the judicial discretion to grant the interlocutory injunction, Accordingly, he says that the injunction should be discharged and the writ set aside.

The second of the submissions raises questions of great difficulty and, in my judgment, can only be tested after much fuller argument and evidence than can be, or ought to be, considered at an interlocutory stage of an action. I would not set aside the writ, therefore, on the basis of this submission, though upon such evidence as we have seen (admittedly one-sided, as the plaintiffs have had no sufficient opportunity to answer the massive evidence introduced, with our leave, by the second defendant during the hearing of the appeal) I think it may well prove to be well founded. The fact, however, that this submission is open to the defendant, and its character, are matters relevant to be considered in the context of the court's discretion to grant interlocutory relief by way of injunction. They are strong factors militating against the exercise of the discretion to grant such relief.

Mr. Kemp for the plaintiffs recognised that the English courts have no jurisdiction to entertain an action to recover damages for a trespass to land situate abroad. Subject to amendment of his statement of claim - which I shall consider later - that must be the end of his case, unless he can show that a conspiracy to effect such a trespass is outside the rule. He seeks to do so by making the following points: (1) that his clients' title to the land is not in dispute; (2) that the conspiracy and overt acts alleged occurred in England; (3) that the second defendant is in England - and was served here; (4) that, since damages would not be an adequate remedy, injunction is appropriate; (5) that the injunction restrains not the trespass to the foreign land but conspiracy in England; (6) that in all the circumstances the trespass to foreign land contemplated by the conspirators is only incidental to the English tort, so that this case should as a matter of principle be treated, if need be, as an exception to the Mo�ambique rule.

Mr. Newman, in a forceful address following his leader, summarised the argument in these emphatic words:

"Our cause of action is the commercial exploitation in England by the defendants and others of our property situate abroad without our consent."

The first four of Mr. Kemp's points are, in my judgment, overborne by the Mo�ambique rule. The plaintiffs are out of possession and must, therefore, establish their right to possession if they are to be in a position to complain of trespass. Inevitably this means that the plaintiffs have to show a better title to possession than that of those presently in possession. And this they cannot do without requiring the court to inquire into the title or right to possession of the foreign lands. The House of Lords refused to

embark upon such an inquiry in the Mo�ambique case [1893] A.C. 602: see the passages quoted by Roskill L.J., from the speech of Lord Herschell L.C. at pp. 624 and 625. Further, the fourth point cannot arise if the court has no jurisdiction to grant damages for the trespass.

The fifth and sixth points are, in my judgment, the high-water mark of the respondents' case. They constitute in essence the reasons why the judge granted the plaintiffs their interlocutory injunction. It is said that the trespass to foreign land is only incidental, that the cause of action is damage sustained in England by a conspiracy taking place in England (as well as elsewhere), and that the case falls outside or is an exception to the Mo�ambique rule. I reject this argument. First, authority is against the device of overcoming substantial difficulties of law by dressing up a case as conspiracy: see Ward v. Lewis [1955] 1 W.L.R. 9 and Marrinan v. Vibart [1963] 1 Q.B. 234; [1963] 1 Q.B. 528. But, more significant, the reliance upon the alleged conspiracy as distinct from the alleged trespass which it is intended to effect is wrong in principle. The combination or agreement which is said to constitute (with overt acts and ensuing damage) the tort of conspiracy, is unlawful only if there be the intention to effect a trespass upon foreign land. Unless that be shown, there is nothing unlawful. And that can be established only if the court is prepared to adjudicate upon the right to possession of the foreign land - which is exactly what the House of Lords said the English courts may not do: see Lord Herschell L.C. in the passage already cited.

As Roskill L.J. said in the course of his judgment, it matters not for the purpose of jurisdiction whether the plaintiffs appear likely to be able to establish their foreign right or not. If it be in issue, as it plainly is in the present case, the English court must refuse to adjudicate upon it. I would therefore allow the appeal and set aside the writ upon the ground of lack of jurisdiction unless the amendment made in the course of the hearing of the appeal has added a claim which the English court does have jurisdiction to entertain.

I turn therefore to consider the amended writ. The key amendment, made during the hearing of the appeal and without leave, is that which has added a claim in respect of chattels, namely the contents of the two hotels. The Mo�ambique rule [1893] A.C. 602 applies only to land. The courts have jurisdiction to entertain a claim to damages for trespass to movable property situate abroad, provided always the acts are actionable in the country where committed. The plaintiffs, therefore, submit that, in so far as it relates to chattels, the writ cannot be set aside for want of jurisdiction. There is, I think, force in this contention. But, as amended, the writ discloses no cause of action in trespass, in that the claim is put upon ownership, not possession. Indeed the writ itself admits that the plaintiffs are, and had been for two years prior to the alleged conspiracy, out of possession. Trespass is, of course, a wrong not to ownership, but to possession. Faced by the amendment, Mr. Neill for the appellant therefore submitted that it disclosed no reasonable cause of action and should not, therefore, be allowed to save the writ from being set aside or struck out. To counter this argument, an attempt at a very late stage was made to re-amend the writ by

raising a claim in conversion. I would not be disposed to give leave for such an amendment.

Although I recognise that it is open to the plaintiffs to issue another writ, if so advised, I think it right to set aside, or strike out, this one. No claim which the court can entertain is to be found correctly pleaded in it. The original claim lacks jurisdiction: and the added claim lacks a pleaded basis necessary to create a cause of action. If the plaintiffs have an arguable case upon the amended writ, as to which I say nothing, they had better start again with their tackle in order. The rescue operation by amendment, in my judgment, fails.

Finally, even if, contrary to my view, the writ discloses a claim which the English court can and ought to entertain, it was, in my judgment, a wrong exercise of discretion to grant the interlocutory injunction. The cause of action, for the reasons which Roskill L.J. has developed, is very doubtful: and, if a wrong has been done or is threatened by the second defendant against the plaintiffs' property (as to which I entertain grave doubts), damages would appear to me to be the appropriate remedy. Indeed, an interlocutory injunction granted in the circumstances of this case could well, as Lord Denning M.R. has shown in the course of his judgment, do more harm than good. An English court may sometimes have to make an order which to some would appear to be an unwarrantable intrusion by a municipal court into the world of international relations between sovereign states: but if an English court is asked to intrude its order into this world, it should be very slow in such a case to grant interlocutory relief by way of injunction, bearing in mind the limitations of evidence and argument necessarily imposed by law on interlocutory proceedings. I would therefore allow the appeal.

Solicitors: Theodore Goddard & Co., Lovell, White & King.

M. M. H.

July 21, 1977. The Appeal Committee of the House of Lords (Lord Wilberforce, Viscount Dilhorne and Lord Fraser of Tullybelton) granted a petition for leave to appeal limited to application to set aside writ.