[PRIVY COUNCIL.]

AND

ON APPEAL FROM THE SUPREME COURT OF THE COLONY OF THE CAPE OF GOOD HOPE.

Act of State - Concessions granted before Cession - Rights after Annexation - Jurisdiction of Municipal Courts - Crown Liabilities Act, 1888.

Held, that the appellants as grantees of concessions made by the paramount chief of Pondoland cannot, after the annexation of Pondoland by Her Majesty, enforce against the Crown the privileges and rights conferred.

Annexation is an act of State, and any obligation assumed under a treaty to that effect, either to the ceding sovereign or to individuals, is not one which municipal Courts are authorized to enforce.

The Crown Liabilities Act, 1888, permits such an action to be brought, but it does not empower the Court to make a declaration of right.

Secretary of State for India in Council v. Kamachee Boye Sahaba, (1859) 13 Moo. P. C. 22, followed.

APPEAL from a judgment of the Supreme Court (March 11, 1895).

The Appellants claimed in their action - (1.) certain railway, mineral, township, land, forest, trading, and other rights in Eastern Pondoland granted to them by Sigcau, paramount chief of Pondoland, under and by virtue of certain four concessions, dated April 10, 1889, October 24, 1890, October 4, 1891, and June 30, 1893, respectively; (2.) a declaration of rights in the premises; (3.) a sum of 5000l. as damages sustained by the appellants, by reason of the interference by the Premier of the Cape Colony with the exercise by the appellants of their rights under the said concessions.

The respondent admitted the execution by Sigcau of the said concessions, but he alleged that at the date of the same the British Government was the sole paramount authority in

Pondoland, and that without the consent of the said Government which consent was not given - the said concessions were of no legal force or effect. He further alleged that the said concessions were contrary to the law and customs of the Pondos, that they were not understood by the said Sigcau and his councillors, that they were void for vagueness and uncertainty, and that no adequate consideration was paid for them by the appellants. He did not admit that the appellants had performed the conditions and stipulations which they were liable to perform by virtue of the said concessions, and he denied that prior to the year 1894 the Pondo nation was an independent State. He alleged that prior to annexation of their territory by the Cape Act No. V. of 1894 Pondoland had already been annexed to and became part of the British dominions, and that neither at that time nor at any subsequent time was any condition made binding upon either the Imperial or Colonial British Government to recognise the said concessions. He further alleged that the said concessions had never been acted upon or carried out, that they affected the lands of certain chiefs who would not by native law be bound by the said concessions, and that they could create only personal obligations, if any, against the said Sigcau.

The Supreme Court held that Sigcau was the recognised paramount chief and supreme ruler of the Pondos, and that in granting the said concessions to the appellants he perfectly well understood the nature of the rights and privileges granted by him; but it held in favour of the respondent that the grant of the said concessions was not in accordance with native customs, that the said concessions had not been carried into practical effect, and that they created no legal obligations which could be enforced in a court of law against the Government of Cape Colony, inasmuch as the said Sigcau might at any time have repudiated the said rights and privileges which he had granted to the appellants, and there would have been no remedy for such repudiation open to the said appellants. The Court further found that the appellants had spent much time and money in acquiring the said concessions, and that their conduct had throughout been honourable and reasonable,

and, while giving judgment for the defendant, each party was ordered to bear their own costs.

Asquith, Q.C., Roger Wallace, Q.C., and Mackarness, for the appellants, contended that they were entitled as prayed. Sigcau, the grantor of the concessions in suit, had, since his accession to power in 1888, been recognised and treated by the British Government as the sole and absolute ruler of Eastern Pondoland as an independent State. Pondoland was annexed to Cape Colony by Act V. of 1894, passed in consequence of Sigcau's deed of cession dated May 17, 1894. It was contended that at the time of making the cession of Eastern Pondoland Sigcau, as paramount chief of Pondoland, gave notice to the Government of the Colony that he desired their recognition of the concessions in suit; and that no repudiation or disapproval thereof by the Colonial Government was at any time communicated to Sigcau until after the deed of cession had been executed by him. The evidence shewed that the appellants had for upwards of five years resided in Pondoland and occupied themselves in obtaining the concessions. Many months of negotiation between Sigcau and the concessionaires preceded the grants. Full notice was given of the grants, and no disapproval intimated by the Government. The evidence shewed that Sigcau had, as he swore, the power to make grants of the nature of those in suit, that the grants had been sanctioned by all the due formalities required by Pondo law, and that they were made in good faith and for good consideration. It was accordingly contended that they became legally and equitably binding upon the said Colonial Government as soon as they had, by accepting from Sigcau the cession of Eastern Pondoland, become his successor as paramount chief of that country. The respondent became by virtue of Sigcau's cession of March 17, 1894, and of the Cape Act V. of 1894, clothed with all the rights and all the obligations attaching to or binding upon Sigcau as such paramount chief. Upon the question how far a civilised government on succeeding to the power theretofore exercised by a barbarian was bound by all the engagements he had made, they referred to the following cases: United States

v. Parchemin (1); Strother v. Lucas (2); Smith v. United States (3); United States v. Auguisola. (4) It was contended that it was impossible to reconcile the ratio decidendi of the judgment of the Court below with the doctrine laid down in those cases. The right to sue and the jurisdiction of the Court to entertain the case are given by Crown Liabilities Act, No. XXXVII. of 1888.

Sir Edward Clarke, Q.C., Swinfen Eady, Q.C., and Waggett,for the respondent, denied that all the obligations of Sigcau were taken over by the Government, and in particular that the obligations under the concessions in suit had been so taken over. Those concessions were in their nature invalid. The land laws of the Cape Colony, to which East Pondoland was annexed, contain no provision for the granting by the Government of tracts of land or servitudes on land such as were promised by these concessions. The rights, moreover, which they purported to grant were unknown, and contrary to and in conflict with the native laws and customs of East Pondoland as the same existed and prevailed before its formal annexation. The concessions were, moreover, injurious to the interests of the native occupants of the country. They could not have been granted without the consent of all or the great majority of the native chiefs and headmen of the district. But only six chiefs were parties to them, whilst forty-three chiefs were parties to the cession of the whole territory to Her Majesty.

The evidence shewed that Sigcau was never, in fact, in territorial possession of the land over which he granted the rights in dispute. Even if the grants were valid, they depended for their continuance on the will of Sigcau as a lord despot, and were revocable by him at will The concessions themselves were never-understood by Sigcau, and are void for uncertainty and are incapable of being enforced. The appellants, moreover, are shewn never to have obtained possession of the lands under their concessions. The Court has no jurisdiction to enforce the rights claimed, and therefore acted rightly in refusing to declare the same and in dismissing the suit. The doctrine

(1) (1833) 7 Peters, 51, 86.

(2) (1838) 12 Peters, 410, 436, 435, 438.

(3) (1836) 10 Peters, 326, 330.

(4) (1863) 1 Wallace, 352, 358.

that under a cession of territory from one sovereign Power to another the grantee succeeds to all the liabilities of the grantor is carefully guarded in the case cited from 12 Peters. And in all three cases cited from Peters legislation had taken place to give effect to the rights conceded. Sigcau stands in a totally different position from the grantors in those cases. Here there was no treaty, and no legislation relating to the rights which he is supposed to have conceded. A subject cannot sue the Government which has annexed territory by an act of State to enforce claims which also by an act of State the annexing Government refuses to be bound. If it had been a case of conquest the question could not arise of enforcing obligations by the conquered. This is a case of cession, and the sovereign Powers could contract as they pleased in reference to such obligations. But whether they did so or not the municipal courts of the annexing territory have no authority or jurisdiction to revise, as it were, the terms of the cession, imply obligations which are not expressed, or enforce those which are. As between the sovereign Powers, the acts done are acts of State, not to be interpreted or enforced by municipal courts; and the same principle applies as between either sovereign Power and its own subjects in respect of the same matters. Reference was made to Halleck's International Law, 1893 ed. vol. ii. pp. 489, 493, 505, 506, 1878 ed. c. 34, ss. 21, 25, 26; United States v. Pearson (1); and United States v. Boisdoré (2), cited in the last case. Under these circumstances the rights claimed under these concessions cannot be declared against the Crown, nor can grants be ordered by way of enforcement of those rights for which grants no legislative sanction has been given.

Asquith, Q.C., replied, contending that, whether an act of State or not, the question was whether it fell within the scope of the Crown Liabilities Act, 1888. As to obligations resulting from international law or treaties being enforceable in municipal courts, and the jurisdiction to entertain the present suit, reference was made to Triquet v. Batte (3); Thomas v. The

(1) (1855) 18 Howard, 1, 13.

(2) (1850) 11 Howard, 63, 96.

(3) (1764) 3 Burr. 1481.

Queen (1), and to certain Cape Colony cases, in which rights had been declared against the Crown: Blanckenbury v. Colonial Government (2); Joubert v. Worcester Municipality and Colonial Government (3); De Beers Consolidated Mines v. Colonial Government. (4)

1899 Aug. 1. The judgment of their Lordships was delivered by

THE LORD CHANCELLOR. This is an appeal from the Supreme Court of the Cape of Good Hope, wherein judgment was given for the defendant.

The action is brought against the Prime Minister of the Colony in his official capacity under the powers of an Act of the Parliament of the Cape of Good Hope intituled the "Crown Liabilities Act, 1888," which permits such an action to be brought in terms hereafter to be referred to.

The case made on behalf of the plaintiffs was that certain agreements or concessions were made by a native chief described as "Paramount Chief of Pondoland" granting certain privileges and rights to the appellants.

It appears to be established by proof that the appellants never in fact obtained possession of the lands or exercised the rights which these documents purported to convey; but it is argued that some effort was made to search for "graphite" in pursuance of these documents.

A considerable amount of evidence appears to have been given with the object of shewing that the rights purported to be granted were contrary to the native laws and customs prevailing in Pondoland at the time when they purported to be granted; that Sigcau was a lawless despot; and that any rights purporting to be granted by him were subject to his arbitrary power to recall them at any moment. And, further, that Sigcau did not understand the meaning or object of the documents which he was supposed to execute.

Their Lordships do not differ with the finding in fact by the Chief Justice that at the time that Sigcau executed the

(1) (1874) L. R. 10 Q. B. 31.

(2) (1894) 4 Shiel, 61; S. C. 11 Juta, 90.

(3) (1895) 5 Shiel, 303; S. C. 12 Tredgold, 305.

(4) (1892) 9 Juta, 101, 107.

instruments in question he was the paramount chief of the Pondos, and that Sigcau understood perfectly well that he was purporting to grant such rights as the instruments which he executed professed to convey.

Their Lordships do not think it material to enter into such questions, inasmuch as they are of opinion that the statute which gives a power to sue the Prime Minister does not involve the power of making any declaration of right in such a case. And as mere matter of form it does not contain any clause empowering the Court to make a declaration of right as against the Crown; but there is a more complete answer to any claim arising from these instruments. The taking possession by Her Majesty, whether by cession or by any other means by which sovereignty can be acquired, was an act of State and treating Sigcau as an independent sovereign - which the appellants are compelled to do in deriving title from him. It is a well-established principle of law that the transactions of independent States between each other are governed by other laws than those which municipal courts administer.

It is no answer to say that by the ordinary principles of international law private property is respected by the sovereign which accepts the cession and assumes the duties and legal obligations of the former sovereign with respect to such private property within the ceded territory. All that can be properly meant by such a proposition is that according to the well-understood rules of international law a change of sovereignty by cession ought not to affect private property, but no municipal tribunal has authority to enforce such an obligation. And if there is either an express or a well-understood bargain between the ceding potentate and the Government to which the cession is made that private property shall be respected, that is only a bargain which can be enforced by sovereign against sovereign in the ordinary course of diplomatic pressure.

In this case it certainly cannot be said that there was any bargain by the British Government that Sigcau's supposed concessions should be recognised. Indeed, the only intelligible sense in which the allegations in the declaration can be understood

is that the breach of duty complained of consists in the refusal of the Cape Government to recognise the plaintiffs' concessions.

To quote the language of this Board, used by Lord Kingsdown in the case of Secretary of State for India in Council v. Kamachee Boye Sahaba (1), and cited in Doss v. Secretary of State for India in Council (2):-

"Of the propriety or justice of that act" (here the refusal to recognise) "neither the Court below nor the Judicial Committee have the means of forming, or the right of expressing if they had formed, any opinion. It may have been just or unjust, politic or impolitic, beneficial or injurious, taken as a whole, to those whose interests are affected. These are considerations into which their Lordships cannot enter. It is sufficient to say that, even if a wrong has been done, it is a wrong for which no municipal court of justice can afford a remedy."

At the same time, their Lordships are by no means prepared to differ from the observations of the Chief Justice that the appellants "have strong claims to the favourable consideration of the Government and Parliament of the country."

Their Lordships will therefore humbly advise Her Majesty that this appeal should be dismissed, the parties on each side to pay their own costs.

Solicitors for appellants: Grant, Bulcraig & Co.

Solicitors for respondent: Wilson, Bristows & Carpmael.

(1) 13 Moo. P. C. 22, 86.

(2) (1875) L. R. 19 Eq. 534.