[QUEEN'S BENCH DIVISION]

WESTLAND HELICOPTERS LTD. v. ARAB ORGANISATION

FOR INDUSTRIALISATION

International Law - Treaty - International organisation - Recognition - Arms manufacturing industry created by treaty between four Arab states - Organisation accorded juridical personality - Organisation excluded from application of domestic law of member states - Three states declaring organisation to be liquidated - Fourth state purporting by means of domestic laws to continue existence of organisation - Whether continuing organisation same body as liquidated organisation

An international organisation ("A.O.I.") was set up in 1975 by a treaty between Egypt and the Gulf states to create an Arab arms manufacturing industry. The treaty expressly accorded juridical personality to A.O.I. and provided that it should not be subject to the law of any member state. A.O.I.'s headquarters were to be in Egypt. Following the signing of the peace treaty between Egypt and Israel in 1979 the Gulf states issued a declaration that A.O.I. would be liquidated. Egypt refused to accept the validity of the declaration and purported, by the issue of domestic laws, to continue its existence as an exclusively Egyptian organisation.

Following international arbitration proceedings arising out of the cancellation of a joint venture contract between it and A.O.I., the judgment creditor was given leave by the High Court to enforce the arbitration award and it subsequently obtained garnishee orders against six banks which held deposits owned by A.O.I. The Egyptian organisation claimed to be the same organisation as A.O.I. and that it was the true owner of the bank deposits. It accordingly intervened in the garnishee proceedings and applied to have the enforcement order set aside. The judgment creditor applied to have the intervener's application struck out.

On the preliminary issue whether the intervener was the same body as the judgment debtor:-

Held, striking the intervener out of the proceedings, that a foreign entity could only be recognised by English law as having legal capacity if it had been accorded legal personality by a friendly foreign state, which, in the case of an international organisation, meant that it had been accorded the legal capacity of a corporation under the law of one of its member states or the state where it had its seat; that where it had been accorded such capacity by more than one state there was nevertheless only one international organisation, albeit it could be recognised on more than one factual basis; that once it was accepted that an international organisation had been recognised by the English courts questions of domicile and nationality became irrelevant; that it would be contrary to the comity of nations for the English courts to impose the domestic law of one of the member states of an international organisation as its governing law, particularly where its founding treaty expressly provided that it was not to be

subject to such domestic law; and that, accordingly, the proper law governing the judgment debtor was public international law and, since the claim of the intervener to be the same body as the judgment debtor depended on the non-justiciable issue of Egyptian law, it was unable to prove its claim (post, pp. 299B-D, 300G, 303H-304B, 308C, 312C-F).

Dictum of Lord Templeman in Arab Monetary Fund v. Hashim (No. 3) [1991] 2 A.C. 114, 162, H.L.(E.) applied.

In re International Tin Council [1989] Ch. 309, C.A. considered.

The following cases are referred to in the judgment:

Aksionairnoye Obschestvo A.M. Luther v. James Sagor & Co. [1921] 3 K.B. 532, C.A.

Arab Monetary Fund v. Hashim (No. 3) [1991] 2 A.C. 114; [1990] 3 W.L.R. 139; [1990] 1 All E.R. 685; [1991] 2 A.C. 114; [1990] 3 W.L.R. 139; [1990] 2 All E.R. 769, C.A.; [1991] 2 A.C. 114; [1991] 2 W.L.R. 729; [1991] 1 All E.R. 871, H.L.(E.)

Bergner & Engel Brewing Co. v. Dreyfus (1898) 70 Am.St.R. 251

British Airways Board v. Laker Airways Ltd. [1985] A.C. 58; [1984] 3 W.L.R. 413; [1984] 3 All E.R. 39, H.L.(E.)

Buck v. Attorney-General [1965] Ch. 745; [1965] 2 W.L.R. 1033; [1965] 1 All E.R. 882, C.A.

Buttes Gas and Oil Co. v. Hammer (No. 3) [1982] A.C. 888; [1981] 3 W.L.R. 787; [1981] 3 All E.R. 616, H.L.(E.)

Gasque v. Inland Revenue Commissioners [1940] 2 K.B. 80

Henriques v. Dutch West India Co. (1728) 2 Ld.Raym. 1532

International Tin Council, In re [1987] Ch. 419; [1987] 2 W.L.R. 1229; [1987] 1 All E.R. 890; [1989] Ch. 309; [1988] 3 W.L.R. 1159; [1988] 3 All E.R. 257, C.A.

Kuenigl v. Donnersmarck [1955] 1 Q.B. 515; [1955] 2 W.L.R. 82; [1955] 1 All E.R. 46

Lazard Bros. & Co. v. Midland Bank Ltd. [1933] A.C. 289, H.L.(E.)

Oppenheimer v. Cattermole [1976] A.C. 249; [1975] 2 W.L.R. 347; [1975] 1 All E.R. 538, H.L.(E.)

Rayner (J. H.) (Mincing Lane) Ltd. v. Department of Trade and Industry [1990] 2 A.C. 418; [1989] 3 W.L.R. 969; [1989] 3 All E.R. 523, H.L.(E.)

Trendtex Trading Corporation v. Central Bank of Nigeria [1977] Q.B. 529; [1977] 2 W.L.R. 356; [1977] 1 All E.R. 881, C.A.

Williams and Humbert Ltd. v. W. & H. Trade Marks (Jersey) Ltd. [1986] A.C. 368; [1985] 3 W.L.R. 501; [1985] 2 All E.R. 208; [1985] 2 All E.R. 619, Nourse J. and C.A.; [1986] A.C. 368; [1986] 2 W.L.R. 24; [1986] 1 All E.R. 129, H.L.(E.)

The following additional cases, supplied by courtesy of counsel, were cited in argument;

Adams v. Cape Industries Plc. [1990] Ch. 433; [1990] 2 W.L.R. 657; [1991] 1 All E.R. 929, Scott J. and C.A.

Admissibility of Hearings of Petitioners by the Committee of South West Africa [1956] I.C.J. Rep. 23

Alcom Ltd. v. Republic of Colombia [1984] A.C. 580; [1983] 3 W.L.R. 906; [1984] 1 All E.R. 1, C.A.

Banco de Bilbao v. Sancha [1938] 2 K.B. 176

Barbuit's Case (1737) Cas.temp.Talb. 281

Blad v. Bamfield (1674) 3 Swans. 604

Brunswick (Duke of) v. King of Hanover (1848) 2 H.L.Cas. 1, H.L.(E.)

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

Case Concerning the Air Services Agreement of 27 March 1946 (United States v. France) (1978) 54 I.L.R. 303

Case of Diversion of Waters from the River Meuse [1937] P.C.I.J. Ser. A/B No. 70

Channel Tunnel Group Ltd. v. Balfour Beatty Construction Ltd. [1992] Q.B. 656; [1992] 2 W.L.R. 741; [1992] 2 All E.R. 609, C.A.; [1993] A.C. 334; [1993] 2 W.L.R. 262; [1993] 1 All E.R. 664, H.L.(E.)

Cook v. Sprigg [1899] A.C. 572, P.C.

Deutsche Schachbau-Und Tiefbohrgesellschaft m.b.h. v. Ras Al Khaimah National Oil Co. [1987] 2 Lloyd's Rep. 246

Dubai Bank v. Galadri (unreported), 20 June 1990, Morritt J.

Fayed v. Al-Tajir [1988] Q.B. 712; [1987] 3 W.L.R. 102; [1987] 2 All E.R. 396, C.A.

Harza Engineering Co. v. Islamic Republic of Iran (1982) 70 I.L.R. 118

International Status of South West Africa Case [1950] I.C.J. Rep. 128

International Tin Council v. Amalgamet Inc., 524 N.Y.S.2d. 971 (Sup. 1988)

Interpretation of the Agreement of 25 March 1951 Between The W.H.O. and Egypt [1980] I.C.J. Rep. 73

Interpretation of Peace Treaties with Bulgaria, Hungary and Romania (Second Phase) [1950] I.C.J. Rep. 221

Legal Consequences for States of the Continued Presence of South Africa in Namibia (South West Africa) Notwithstanding Security Council Resolution 276 (1970) [1971] I.C.J. Rep. 16

Nabob of Carnatic v. East India Co. (1791) 1 Ves.Jun. 370

Nissan v. Attorney-General [1970] A.C. 179; [1969] 2 W.L.R. 926; [1969] 1 All E.R. 629, H.L.(E.)

Reg. v. Secretary of State for Transport, Ex parte Iberia (unreported), 8 July 1985, Taylor J.

Rustomjee v. The Queen (1876) 2 Q.B.D. 69

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

Settebello Ltd. v. Banco Totta and Acores [1985] 2 All E.R. 1025, C.A.

Societe KKM & Siemens v. Societe Dutco (French Cour de Cassation, 7 January 1992), Rev.Arb. 1992

Starrett Housing Corp. v. Government of the Islamic Republic of Iran (1987) 85 I.L.R. 350

SUMMONS

On 28 June 1993 an arbitration award was made in Geneva in favour of the judgment creditor, Westland Helicopters Ltd., in the sums of £385,346,547.50 and U.S.$1,829,022 against the judgment debtor, the Arab Organisation for Industrialisation. On 9 July 1993 by an order of Clarke J. the judgment creditor was given leave under R.S.C., Ord. 73, r. 10(1) to enforce the arbitration award in the same manner as a judgment, and garnishee orders nisi were made against six banks with offices in London to attach debts due from them to the judgment debtor to answer the order of 9 July.

A body with headquarters in Cairo known as the Arab Organisation for Industrialisation claimed to be the same organisation as the judgment debtor and consequently to be the owner of the deposits subject to the garnishee orders. On 21 January 1994 Longmore J. ordered that body to be joined in the proceedings so that it could appear and state its interest

in the deposits and, having been joined as intervener, it applied to have the order of 9 July 1993 set aside. By summons dated 10 March 1994 the judgment creditor applied to strike out the intervener's application, and the preliminary issue arose as to the intervener's locus standi as the same body as the judgment debtor. The applications were heard in chambers but judgment was given in open court.

The facts are stated in the judgment.

Stanley Burnton Q.C., Rosalyn Higgins Q.C., Andrew Lenon and Malcolm Shaw for Westland.

V. V. Veeder Q.C., Ian Brownlie Q.C. and David Lloyd Jones for the intervener.

Glen Davis for the garnishees.

3 August. COLMAN J. read the following judgment.

Introduction

There are before the court a number of preliminary issues which arise in the course of garnishee proceedings. In those proceedings the judgment creditor, "Westland," has obtained garnishee orders nisi against each of six banks with offices in London to the effect that debts due from each of them to the judgment debtor, the Arab Organisation for Industrialisation ("A.O.I."), be attached to answer an order of Clarke J. made on 9 July 1993 under which Westland was given leave under R.S.C., Ord. 73, r. 10(1) to enforce an arbitration award in its favour against A.O.I. in the same manner as a judgment.

The arbitration award was made in Geneva on 28 June 1993 by international arbitrators acting in an International Chamber of Commerce arbitration between Westland as claimant and A.O.I. as respondent. The arbitrators awarded damages to Westland in the total amounts of £385,346,547.50 and U.S.$1,829,022, together with interest at the rate of 1 per cent. per annum over the base rate of National Westminster Bank. On 1 December 1993, as a result of enforcement proceedings in the United States District Court of the Southern District of New York, Westland recovered U.S.$36,661,362.48. The deposits of A.O.I. at the six garnishee banks amount in total to U.S.$474,430,697.20, which is equivalent to £317,937,173.12. The garnishee orders nisi are in the aggregate sum of £395,997,608.20.

The preliminary issues arise because there exists in Cairo a body known as the Arab Organisation for Industrialisation which claims that it is the same organisation as A.O.I., the judgment debtor, and that it is consequently the owner of the deposits at the garnishee banks. As such the Cairo body has applied for an order that Clarke J.'s order, giving leave to enforce the Geneva award, should be set aside on a number of grounds, namely:

"(1) The composition of the arbitral authority and the arbitral procedure were not in accordance with the agreement of the parties;

(2) the defendant was denied a proper opportunity to present its case and/or was otherwise unable to present its case; (3) the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration and contains decisions on matters beyond the scope of the submission to arbitration; (4) enforcement would be against public policy."

Because of the Cairo body's assertion to the garnishee banks that it was the true owner of the deposits, Longmore J. ordered on 21 January 1994 that it be joined in the proceedings so that it could appear and state its interest in the deposits. That is how the Cairo body comes before the court as intervener. Once having been joined, it applied to set aside the 9 July 1993 order. Since there is no doubt that A.O.I. was party to the arbitration award and therefore judgment debtor, the Cairo body as intervener, if it is to challenge the enforcement of the arbitration award in these proceedings, must prove that those who now claim to represent A.O.I. - the chairman of its board of directors, its solicitors, Herbert Smith, and its counsel - do indeed have the authority of A.O.I. to mount that challenge. Westland have also applied to strike out the intervener's application for the order of 9 July 1993 to be set aside. The grounds are in substance the same as those relied upon by Westland as against the intervener's claim to an interest in the bank deposits.

The preliminary issues have been designed to resolve the threshold question of the intervener's locus standi as the same body as A.O.I. For reasons which will appear I refer to the intervener in some parts of this judgment as "1979 A.O.I."

Historical background

On 29 April 1975 a treaty was made between the United Arab Emirates, Qatar, Saudi Arabia and Egypt. I refer to it as "the treaty" and to the first three states as "the three Gulf states." The treaty provided for the organisation to have "the juridical personality and all rights and powers to perform its activities within the participating states." The treaty envisaged that the A.O.I.'s detailed constitution would be set out in its basic statute. In referring to the treaty in this judgment I refer also to the basic statute which was signed by ministerial representatives of the member states. The purpose of the treaty in setting up the A.O.I. was to create an Arab arms manufacturing industry. The underlying, although not the exclusive purpose, was to provide arms for use in the confrontation with Israel. The treaty contained provisions setting up a high committee consisting of ministers representing each signatory state. The high committee was to nominate a board of directors, consisting of two representatives from each state. The chairman of the board was to be chosen by the high committee. By article 15 each government undertook to pass the necessary legislation and take essential measures to implement the provisions of the treaty. This was duly done by each government. In particular Egypt passed Law No. 12 of 1975. The treaty provided by article 3 that its headquarters was to be in Cairo. The organisation created by the treaty - the A.O.I. - clearly had the necessary attributes of an international organisation. It was created by treaty. Its members were

states. It was given legal personality by legislation in each of its four member states. That is common ground in these proceedings.

On 27 February 1978 Westland entered with A.O.I. into a contract, called the shareholders' agreement, under which it was agreed to set up a joint venture Egyptian company called Arab Helicopter Co. ("A.B.H."). It was to undertake in Egypt the manufacture, assembly, overhaul, testing and sale of Lynx helicopers, which, as is well known, were then manufactured by Westland in Britain.

On 17 September 1978 Egypt and Israel signed the Camp David framework agreements which envisaged a structured progression by Israel and the Arab states towards peace in the Middle East. This was rejected by all members of the Arab League, apart from Egypt, at the first Baghdad conference on 2 to 5 November 1978. The peace treaty between Israel and Egypt was signed in Washington on 26 March 1979. This caused bitter recriminations in the Arab world. At the second Baghdad conference held on 27 to 31 March 1979 the other Arab states agreed to impose on Egypt a political and economic boycott. This was clearly likely to involve acute difficulties for the operation and administration of A.O.I.

Consequently, on 14 May 1979 the chairman of the high committee of A.O.I. issued a declaration stating that the three Gulf states "think now that these circumstances conflict with the aims for which the Arab Arms Industry was set up" and he announced officially the decision of the leaders of those states that:

"2. From the date of issuing this statement, 14 May, and, until such time as the existence of the orgnisation is terminated from the Arabian point of view, a committee will be formed of the four countries to start liquidating the funds of the organisation provided that this committee shall meet immediately at the branch office of the Arab Arms Industry in Paris. 3. As of this date the president of the Arab Arms Industry and its director will stop action regarding all the investment funds of the arms industries and to take all necessary steps immediately to stop working on investment budgets of the companies jointly participating with the Arab Arms Industry and cancel all matters which are considered a block to the course of the liquidation. At such time as the statement is published I would like to express my deep sorrow to the leaders of the three countries for the reason which resulted in the collapse of the Arab Arms Industry which was an aim for our people in the long run."

By the time when this declaration was made A.O.I. controlled a very substantial industrial organisation. It had a paid-up capital of U.S.$919m. and cash deposits of U.S.$418m., including deposits at the six garnishee banks. Its headquarters employed about 800 people and it and companies which it owned jointly with British and American interests employed about 16,000 people. It owned two factories producing military aircraft and jet engines respectively at Helwan, the Saker factory at Heliopolis, a centre for research, development and production of rocketry and missile systems, and the Kader factory at Heliopolis, which designed and produced trainer aircraft, armoured vehicles and bombs. Moreover, each of the four member states of A.O.I. had become committed to purchase

Lynx helicopters from A.O.I. or was about to contract to do so. About 250 helicopters were involved, of which Egypt was committed to take 166.

It is said by the interveners that, in so far as it may be relevant to these proceedings, Prince Sultan's declaration of 14 May 1979 was invalid because it was not open to three of the signatories of the treaty alone to terminate A.O.I.'s existence, the declaration was inconsistent with the procedure for termination in the treaty, the three Gulf states had no right to direct the chairman of the board and the director general to suspend operations and the liquidation committee was invalidly set up. That view was immediately expressed in a statement made on 17 May 1979 by General Kamal Hassan Ali, the Egyptian Minister of Defence. He refused to accept the validity or legality of the three Gulf states' actions and stated:

"Egypt also reminds them that the withdrawal of any member state or even the withdrawal of the three states from the organisation does not mean the termination of the organisation's legal existence. This is because the legal existence of the organisation is fortified by the approval of the basic rules and regulations by the high committee, and by its ratification by the four governments in 1975. Accordingly, any one of the three states, or all of them together, are free to maintain or terminate their membership in the organisation - provided this is done in accordance with the provisions of the founding agreement and the basic rules and regulations; and they will have to bear the consequences of any such move. Also this will not mean the termination of the legal existence of the organisation."

Decree Law No. 30 of 1979

Consistently with Egypt's response on 18 May 1979, the Egyptian President issued Decree Law No. 30 of 1979. This law provided in articles 1, 2 and 5 as follows:

"Article 1. (1) The A.O.I., formed as a body corporate under the above resolution of the high committee issued in Cairo and having its seat of management and centre of activities in the Arab Republic of Egypt shall continue to enjoy its juristic personality in accordance with the law of the said seat and centre. It shall continue to be vested with the attributions, powers, privileges and immunities bestowed thereon under the said resolution and Decree Law No. 150 of 1976 referred to herein above. (2) Unless otherwise provided for in this law, the existence and activities of the A.O.I. shall continue to be governed by the law of its seat of management and centre of activities and by its basic statute. (3) The A.O.I. shall continue to perform its activities, recover its rights and discharge its obligations as a body corporate in Egypt and all other states.

"Article 2. (1) Within the meaning of the provisions of this law and for all purposes and intents thereunder, the 'official declaration' dated 14 May 1979 issued by the chairman of the high committee of the A.O.I., on behalf of the Kingdom of Saudi Arabia, the United Arab Emirates and the State of Qatar, shall be deemed to be an expression of the determination of these states to withdraw irrevocably

from the membership of the A.O.I. and to relinquish their status as partners in that organisation as from the date on which that 'official declaration' was issued. (2) Neither the 'declaration' referred to in the preceding paragraph, nor the withdrawal and relinquishment provided for therein, shall affect or prejudice in any manner the juristic personality of the A.O.I., the continuance of activities exercised thereby, the rights and obligations thereof towards third parties, the statutes of companies in which the A.O.I. is a participant, nor the privileges and immunities granted to these companies under Law No. 51 of 1977 referred to herein above."

"Article 5. As a consequence of the 'official declaration' referred to in article 2, all the representatives of the three states have ceased to be chairmen and/or members, both of the high committee and of the board of directors of the A.O.I., as from 14 May 1979. The Egyptian members in the high committee and the board of directors of the A.O.I. shall continue to exercise alone or collectively, each within his respective jurisdiction, all the attributions of the high committee and the board of directors of the A.O.I., pending promulgation by the President of the Arab Republic of Egypt of a decree reorganising the said high committee and board of directors and setting out the procedures to be followed in this respect."

There can be no doubt that Law No. 30 sought to introduce changes in the constitution and representation of A.O.I. Not least, article 1(2) provided for the existence and activities of A.O.I. to be governed by the law of its seat of management and centre of activities - Egyptian law. The dispute resolution regime set up under articles 3, 4 and 7 differed fundamentally from that envisaged by the treaty and basic statute. Article 5 provided for the remaining Egyptian members of the high committee and the board of directors of the A.O.I. to exercise "alone or collectively . . . all the attributions" of those two bodies pending promulgation by the President of Egypt of a decree "reorganising" those bodies.

Law No. 343 of 1979 provided that high committee was to be headed by the President of Egypt and to be composed of the Vice President of Egypt, the Prime Minister, the Ministers of Defence and Military Production, of State, of Finance and of the Economy as well as the Chief of Staff of the Egyptian Armed Forces and the "chairman of A.O.I." the consequence of this law was to create a high committee manned exclusively by Egyptian ministers and officials and empowered under Egyptian law to conduct the affairs of the organisation which can conveniently be called "1979 A.O.I."

The international arbitration

On 24 May 1979 Sheikh Faisal Al-Qassimi of Abu Dhabi (U.A.E.), provisional chairman of the board of directors of A.O.I., handed a letter to Westland in which it was stated that the three Gulf states would not be responsible for the performance of any contracts between Westland and A.O.I., but anticipated an amicable settlement. It is said by Westland that at that meeting Sheikh Faisal further informed Westland that the three

states accepted responsibility to Westland for loss of business in relation to the helicopter contracts. On 26 June 1979, at another meeting with Westland, Sheikh Faisal invited Westland to present its claims to the A.O.I. liquidation committee in Riyadh. He handed over letters announcing that co-operation between Westland and A.O.I. would not be possible after 1 July 1979 and that A.O.I. was cancelling its contracts with A.B.H. Sheikh Faisal raised the possibility of direct orders for helicopters from the three states.

Meanwhile, from 29 June Mr. Zendru, who had been appointed chairman of the board of 1979 A.O.I. under the regime created by Law No. 30, corresponded with Westland and took part in meetings with it, taking the line that Westland should ignore what it was told by Sheikh Faisal and that it was the policy of Egypt that 1979 A.O.I. should perform all A.O.I.'s contracts and joint ventures. Westland, however, consistently stated that the contractual relationships between it and A.O.I. had come to an end. By letter dated 9 July 1979 Westland informed the three Gulf states that the joint venture was at an end and, by letter of 3 August 1979 to General Kamal Hassan Ali, it similarly informed Egypt. Mr. Zendru, however, continued to say that 1979 A.O.I. and Egypt were determined to perform the agreements. Westland then by a document dated 3 August 1979 presented its claim for compensation to the A.O.I. liquidation committee in Riyadh.

Thus by the end of July 1979 the realities were that the three Gulf states had set up what they called a liquidation committee at the small A.O.I. office in Riyadh. Egypt took no part. On the other hand Egypt through the machinery set up under Law No. 30 was in fact controlling and managing the headquarters and industrial installations of A.O.I. In that exercise the three Gulf states took no part.

On 12 May 1980 Westland, having achieved no compensation settlement with A.O.I., submitted to the I.C.C. its formal request for arbitration. It joined as respondents A.O.I., the four member states and A.B.H. The request stated that A.O.I. had its head office in Cairo and an office in Riyadh. On 3 February 1982 Westland presented a memorandum to the arbitrators by which it asserted that 1979 A.O.I. was not the first respondent: only the body with its office in Riyadh was the true respondent. By an order of 8 June 1982 the arbitral tribunal accepted Westland's contentions. It ruled by a procedural order that A.O.I. was the organisation which had its office in Riyadh and not 1979 A.O.I. in Cairo. That order was subsequently set aside by the Swiss courts: it ought to have been in the form of an award and not a mere order. By a decision dated 5 March 1984 the tribunal concluded that 1979 A.O.I. was not an appropriate respondent to the arbitration and had no legitimate interest in being made a party. Westland had asserted that it was not respondent to the arbitration and it would thus not be bound by an award. By an award dated 25 July 1985 the arbitrators concluded that 1979 A.O.I. was not and never had been a party to the arbitration. Therefore counsel for 1979 A.O.I. could not act for A.O.I., the respondent to the arbitration. 1979 A.O.I.'s application to the Court of Appeal of Geneva to set aside the award of 25 July 1985 was turned down. On 19 July 1988 the Swiss Federal Court dismissed an appeal on the grounds that inasmuch as

Westland had asserted that it claimed against A.O.I. and not 1979 A.O.I. the latter could not be a party to the arbitration.

Thus 1979 A.O.I. was finally excluded from the arbitration. It was therefore not permitted to advance any case on the merits of Westland's claim and that is one of the several reasons why 1979 A.O.I. - now the intervener - submits that the award of 28 June 1993 should not be enforced against A.O.I. However, before this court can consider the attack on the enforcement of that award, the intervener has to establish that it is A.O.I., the party to the shareholders' agreement, the respondent to the arbitration and the judgment debtor. If it is not, it has no entitlement to intervene or to seek to set aside the order of Clarke J. giving leave to enforce the award as a judgment.

The intervener's case

It was submitted by Mr. Veeder on behalf of the intervener that the existence, constitution and authority of the officers of A.O.I. was to be determined by Egyptian law. He conceded that A.O.I. was, as formed in 1975, an international organisation, the product of a treaty between the three Gulf states and Egypt, but he contended that, because Egypt was the headquarters state or state of the seat of the A.O.I., it was in Egypt that the organisation had its centre of gravity or domicile. By analogy with the English conflicts rule that a company incorporated in a foreign sovereign state was, as regards its constitution, governed by the law of that state, an international organisation such as A.O.I. would similarly be subject to the law of its state of domicile, in this case Egypt. In support of this proposition he relied on the speech of Lord Templeman in Arab Monetary Fund v. Hashim (No. 3) [1991] 2 A.C. 114 ("the A.M.F. case").

If it were right that the existence, constitution and representation of A.O.I. were governed by Egyptian law, the effect of Law No. 30 in Egyptian law was to continue the pre-existing A.O.I. subject to alterations in its management and control justified as a matter of necessity by the precipitate withdrawal from A.O.I. of the three Gulf states. In the eye of Egyptian law, according to the intervener's expert witness, 1979 A.O.I. was precisely the same legal personality as the original A.O.I. the subject of the 1975 decree. Consequently, the appointment by the high committee of Lieutenant-General E. El Orabi as chairman of the board of directors of 1979 A.O.I. as from 13 October 1987 and his subsequent reappointment to that position in 1989, 1991 and 1993 was a valid appointment and subsequent reappointment of an officer of A.O.I., the judgment debtor and owner of the bank deposits. Since it was the intervener's unchallenged evidence that it was from Lt.-Gen. Orabi that its solicitors, Herbert Smith, received their instructions, those representing the intervener necessarily represented A.O.I. and not merely 1979 A.O.I.

Alternatively it was contended on behalf of the intervener that, if, as Westland submitted, the proper law was public international law, the intervener was none the less entitled to rely on Law No. 30 as the source of authority of those controlling A.O.I. because the burden of establishing the irrelevance or invalidity of Law No. 30 rested on Westland and could not be discharged because such allegations were non-justiciable in the English courts. If that were not correct, Law No. 30 was indeed, as a

matter of public international law, a justifiable response by Egypt to the actions of the three Gulf states and could accordingly be relied on as founding the authority of those controlling 1979 A.O.I. to control A.O.I.

Westland's case

Westland submitted that, because A.O.I. was an international organisation, its existence, constitution and representation were governed by public international law and in particular the terms of the treaty, including the basic statute. It followed that (a) Egyptian law was irrelevant to the issue of authority to represent A.O.I. and it was accordingly impermissible for the intervener to rely on Law No. 30 or Presidential Decree 343; (b) the submission that the intervener was entitled to rely on Egyptian law to found authority because Law No. 30 was as a matter of public international law as a justifiable response by Egypt to the actions of the three Gulf states raised an issue which was non-justiciable in the English courts; (c) accordingly the intervener, which had the burden of establishing its authority to act for A.O.I., could not rely on Law No. 30 and was therefore unable to discharge that burden.

Non-justiciable issues

Before considering the submissions of the parties as to the proper law governing the existence, constitution and representation of A.O.I., it is necessary to refer to a particular principle of English law which plays a significant part in resolving the proper law issue, namely the doctrine of the non-justiciability of disputes between foreign sovereign states.

That doctrine was considered as representing a broad general principle by Lord Wilberforce in Buttes Gas and Oil Co. v. Hammer (No. 3) [1982] A.C. 888, 931-932:

"So I think that the essential question is whether, apart from such particular rules as I have discussed . . . there exists in English law a more general principle that the courts will not adjudicate upon the transactions of foreign sovereign states. Though I would prefer to avoid argument on terminology, it seems desirable to consider this principle, if existing, not as a variety of 'act of state' but one for judicial restraint or abstention. . . . In my opinion there is, and for long has been, such a general principle, starting in English law, adopted and generalised in the law of the United States of America which is effective and compelling in English courts. This principle is not one of discretion, but is inherent in the very nature of the judicial process."

It is clear from Lord Wilberforce's analysis of the issues arising in the Buttes Gas case that it is not open to the English courts to determine issues of public international law the result of which determination is likely to affect foreign sovereign states. In particular, the adjudication of the question of the validity of the act of a foreign sovereign state measured by the principles of public international law is no more appropriate in the English courts than is adjudication of the validity of the acts within its own territory of a foreign sovereign state by references to its own constitutional powers. The latter exercise has long been held to be contrary

to the doctrines of sovereign immunity. Thus in Buck v. Attorney-General [1965] Ch. 745, 770, Diplock L.J. observed:

"As a member of the family of nations, the Government of the United Kingdom (of which this court forms part of the judicial branch) observes the rules of comity, videlicet, the accepted rules of mutual conduct as between state and state which each state adopts in relation to other states and expects other states to adopt in relation to itself. One of those rules is that it does not purport to exercise jurisdiction over the internal affairs of any other independent state, or to apply measures of coercion to it or to its property, except in accordance with the rules of public international law. One of the commonest applications of this rule by the judicial branch of the United Kingdom Government is the well-known doctrine of sovereign immunity. A foreign state cannot be impleaded in the English courts without its consent: see Duff Development Co. v. Kelantan Government [1924] A.C. 797, 820. As was made clear in Rahimtoola v. Nizam of Hyderabad [1958] A.C. 379, the application of the doctrine of sovereign immunity does not depend upon the persons between whom the issue is joined, but upon the subject matter of the issue. For the English court to pronounce upon the validity of a law of a foreign sovereign state within its own territory, so that the validity of that law became the res of the res judicata in the suit, would be to assert jurisdiction over the internal affairs of that state. That would be a breach of the rules of comity. In my view, this court has no jurisdiction so to do."

In J. H. Rayner (Mincing Lane) Ltd. v. Department of Trade and Industry ("the Tin Council case") [1990] 2 A.C. 418, 499, it was stated by Lord Oliver of Aylmerton:

"The principle of non-justiciability. There is, as indeed there can be, little contest between the parties as to the general principles upon which that which has been referred to as the doctrine of non-justiciability rests, though they approach it in rather different ways. The contest lies not so much as to the principle as to the area of its operation. It is axiomatic that municipal courts have not and cannot have the competence to adjudicate upon or to enforce the rights arising out of transactions entered into by independent sovereign states between themselves on the plane of international law. That was firmly established by this House in Cook v. Sprigg [1899] A.C. 572, 578, and was succinctly and convincingly expressed in the opinion of the Privy Council delivered by Lord Kingsdown in Secretary of State in Council of India v. Kamachee Boye Sahaba (1859) 13 Moo.P.C.C. 22, 75: 'The transactions of independent states between each other are governed by other laws than those which municipal courts administer: such courts have neither the means of deciding what is right, nor the power of enforcing any decision which they may make.'"

Lord Oliver continued, at pp. 500-501:

"That a treaty may be referred to where it is necessary to do so as part of the factual background against which a particular issue arises

may seem a statement of the obvious. But it is, I think, necessary to stress that the purpose for which such reference can legitimately be made is purely an evidential one. Which states have become parties to a treaty and when and what the terms of the treaty are are questions of fact. The legal results which flow from it in international law, whether between the parties inter se or between the parties or any of them and outsiders are not and they are not justiciable by municipal courts."

It is the logical consequence of this principle that it is not open to the English courts to determine whether a foreign sovereign state has broken a treaty or effectively terminated it: see British Airways Board v. Laker Airways Ltd. [1985] A.C. 58, 85-86, per Lord Diplock.

It follows that any attempt by the courts of this country to determine in these proceedings whether there has been a breach of the treaty either by the three Gulf states or by Egypt would be quite contrary to the principle of non-justiciability. It would involve not only a domestic court passing judgment on the validity of the acts of a foreign sovereign state but also doing so in circumstances where the result of that determination would be to affect the rights to the bank deposits of an international organisation which was the product of the treaty in question. Inasmuch as such determination would directly affect the rights of the international organisation to those assets, it would indirectly affect the sovereign states which were members of it. Comity precludes any such determination.

Accordingly, I approach the issues in this case on the basis that (a) it is not open to me to consider (i) whether the acts of the three Gulf states or Egypt (particularly Law No. 30 or Presidential Decree 343) were in breach of the treaty or basic statute or (ii) whether such acts were or were not permissible under any general principle of public international law; and (b) it is open to me (i) to look at the terms of the treaty and basic statute either as a matter of fact or as a matter of the municipal law of Egypt, since it was incorporated into that law by Decree Law No. 12 of 1975, (ii) to look at the provisions of Law No. 30 and Presidential Decree 343, (iii) to investigate whether those Egyptian laws, always assuming them to be valid as a matter of Egyptian domestic law, effected any changes in the treaty or basic statute as incorporated into Egyptian domestic law which are relevant to the case advanced by the intervener that those who manage and control it and authorise its lawyers to pursue this intervention are the duly appointed officers of A.O.I., the judgment debtor and owner of the bank deposits.

The A.M.F. case

The material issue in the A.M.F. case [1991] 2 A.C. 114 was whether the international organisation known as the Arab Monetary Fund could sue Dr. Hashim and the banks in the English courts. The fund had been set up by 20 states and the P.L.O. under an agreement made at Rabat in 1976. The agreement provided that the fund was to have independent juridical personality and the right to own, contract and litigate. By the terms of the agreement the headquarters of the fund was in Abu Dhabi in the United Arab Emirates. It was the duty of each of the participating

states under the agreement to give effect to the agreement by taking such municipal legislative steps as might be necessary to give the international organisation which they had set up in the shape of the fund juridical personality in their own municipal law. The U.A.E. did this by decree in April 1977. The fund was thereby given the right to sue and be sued under U.A.E. law. The decree annexed the terms of the agreement itself. Other participating states also took the steps appropriate to their domestic systems of law to give juridical personality to the fund.

It had originally been submitted by those representing the fund that as a principle of the common law where foreign states recognised by the United Kingdom Government, but excluding the United Kingdom, had set up an international organisation which by the founding treaty had been given juridical personality, the English courts would recognise the organisation as having such juridical personality and in particular capacity to sue and be sued. However, that argument had to be abandoned in the course of the first instance hearing before Hoffmann J. as a result of the reasoning of the House of Lords and in particular of Lord Oliver in the Tin Council case [1990] 2 A.C. 418 which had made the submissions untenable.

Consequently, the sole basis upon which it was contended that the fund should be recognised as having capacity to sue in the English courts was that, seeing that it had been accorded juridical personality by U.A.E., a participant in the agreement and the headquarters state, it was a corporation created by a foreign friendly state and should therefore be recognised as having legal capacity under English conflict rules. This argument was thus based on the U.A.E. municipal legislation, notably the 1977 decree, as having the effect of creating a body corporate with juridical personality in U.A.E. law. This argument was accepted both by Hoffmann J. at first instance and by Bingham L.J., who dissented, in the Court of Appeal.

One of the main attacks on this argument advanced on behalf of Dr. Hashim and the banks at each stage of the case up to and including the House of Lords was that if it was right that English law treated the U.A.E. decree as having created a distinct legal personality it must follow that there were as many distinct legal personalities as there were participating states which had by municipal legislation accorded legal personality to the fund. If the body corporate created by U.A.E. was distinct from the international organisation set up by the agreement, it must logically also be distinct from the bodies corporate created by the other participating states by their own municipal legislation giving effect to the agreement. The logical consequence was that each such emanation of the fund could separately sue and be sued and might even sue one another.

This argument was acknowledged by Hoffmann J. at the end of his judgment, but held not to destroy the correctness of the fund's main contention:

"I accept that a logical consequence is the existence of other emanations of the fund under the laws of other member states. This raises questions of trinitarian subtlety into which I am grateful that I need not enter:" [1991] 2 A.C. 114, 124.

In his dissenting judgment in the Court of Appeal, Bingham L.J. did not refer expressly to that argument, but he very specifically rejected the concept that the entity the subject of the U.A.E. decree was a U.A.E. domestic corporation as distinct from the international organisation to which the U.A.E. had by the decree accorded legal personality and the capacity to sue and be sued. He said, at pp. 140-141:

"The decree fulfilled the U.A.E.'s obligations to ratify. In this country, ratification alone (being an executive act) cannot alter the domestic law. But the evidence is clear and uncontradicted that the decree (not, be it noted, the treaty) conferred on the A.M.F. legal personality and the capacity to sue and be sued in U.A.E. law. The effect of the U.A.E. decree was, I think, similar to that of the Order in Council of 1972 which the House of Lords considered: in each case a municipal instrument authorised by its local constitutional arrangements conferred legal personality on a body which in English (and, it would seem, U.A.E.) law would otherwise have been regarded as lacking independent existence because the creature of a non-justiciable treaty. The false analogy on which the judge was said to have relied was in treating the A.M.F., by virtue of the decree, as a domestic U.A.E. entity when (it was said) the House of Lords had not treated the Order in Council as converting the I.T.C. into a domestic United Kingdom entity. I accept that their Lordships did not treat the Order in Council as creating a domestic United Kingdom entity: see particularly Lord Templeman [1990] 2 A.C. 418, 478C-E and Lord Oliver of Aylmerton, at p. 505D-F. In those passages their Lordships were concerned to rebut an argument that, if Parliament had intended to incorporate the I.T.C., the familiar language of incorporation would have been used. But it would not of course be acceptable for one sovereign state, party to an international treaty, to hijack an organisation to which it and other states had given birth and subject it (contrary to the treaty terms) to its own domestic jurisdiction. The House of Lords were at pains to point out that the Order in Council had not purported to do that. Nor, as I think, did the decree purport to do that. I see no false analogy here. It was argued that the House of Lords had not treated the body upon whom legal personality was conferred by the Order in Council as different from the international organisation to which I.T.A. 6 gave birth, whereas the judge was content to see the A.M.F. as a legal entity under the law of the U.A.E. distinct from the international organisation to which the A.M.F. treaty gave birth. I see no logical discrepancy. The I.T.C. had no legal existence in the law of the United Kingdom without the Order in Council: see p. 510D-E. On the evidence, the A.M.F. had no legal existence in the law of the U.A.E. without the decree. Neither Order in Council nor decree created a domestic corporation but each was effective to confer legal personality in its respective municipal law on a body which would otherwise have lacked it. Again I see no false analogy."

Bingham L.J. thus treated the U.A.E. decree as having the following consequences: (i) to give to the fund a legal personality in U.A.E. law

which it would otherwise have lacked and (ii) to leave the fund as an international organisation as distinct from a U.A.E. domestic corporation subject to U.A.E. domestic jurisdiction.

In the House of Lords the only substantial majority speech was given by Lord Templeman. Having referred to the uncontradicted expert evidence of Mr. Hamza, legal adviser to the U.A.E. Foreign Ministry, that the fund "had conferred on it by publication of Federal Decree No. 35 independent legal personality and the capacity to sue and be sued in U.A.E. law," he continued, at p. 160:

"Thus the fund was created a corporate body by the U.A.E. and corresponds roughly to an English company limited by shares with the member states as the shareholders, a board of governors which represents the shareholders, a board of executive directors and a director general corresponding to a managing director. I am unable to agree with my noble and learned friend, Lord Lowry, that Federal Decree No. 35 only recognised an international organisation and did not create a corporate body. When the promoters of a company enter into an agreement to incorporate a company and the agreement takes the form of a memorandum and articles of association of the company, that agreement does not create a corporation. When the memorandum and articles are registered under the Companies Act 1985, that registration does not recognise a corporation but creates a corporation. Similarly, when sovereign states enter into an agreement by treaty to confer legal personality on an international organisation, the treaty does not create a corporate body. But when the A.M.F. agreement was registered in the U.A.E. by means of Federal Decree No. 35 that registration conferred on the international organisation legal personality and thus created a corporate body which the English courts can and should recognise."

I have no doubt at all that Lord Templeman was not in that passage using the words "created a corporate body" in any sense which differed in substance from the analysis expressed by Bingham L.J. in the passages to which I have already referred. He was saying simply that, inasmuch as prior to the decree the fund was an entity which did not exist as a juridical person in U.A.E. law, the decree had the effect of creating a juridical person in the eye of U.A.E. law.

Having held, at p. 161, that the courts of this country recognise a body corporate created by the law of a foreign state recognised by the Crown, Lord Templeman observed that "In the present case the federal decree with the articles of agreement annexed suffices to prove incorporation of the fund in the U.A.E." and, having cited certain authorities to which I shall have to return, concluded, at p. 162: "The courts of the United Kingdom can therefore recognise the fund as a legal personality created by the law of the U.A.E." Lord Templeman was therefore clearly saying that the law of the U.A.E. had created legal personality for the fund. He was not saying that the fund was a U.A.E. corporation with all the legal attributes of such a body any more than the House of Lords in the Tin Council case [1990] 2 A.C. 418 was saying that the I.T.C. was or had all

the attributes of a company incorporated under the United Kingdom Companies Act.

That this is the effect of Lord Templeman's speech is conclusively established by what follows [1991] 2 A.C. 114, 162:

"It was submitted on behalf of the respondent banks that the fund was created a legal personality not only by the U.A.E. but also by the other 20 states who were parties to the A.M.F. agreement. Therefore, it is said, there are 21 legal personalities and it is not clear whether Dr. Hashim embezzled the money of the U.A.E. fund or the money of a fund established by some other Arab state. My Lords, though the fund was incorporated by 21 states and has multiple incorporation and multiple nationality there is only one fund with its head office in Abu Dhabi, one board of governors, one executive board of directors and one director general. The domicile and residence of the fund are in the U.A.E. and nowhere else. Dr. Hashim was appointed by the board of governors of the fund as director general of the fund and stole the money belonging to the fund. It was argued that the fund as incorporated in Iraq, for example, might be different from the fund as incorporated in the U.A.E. and that the Iraqi fund might even sue the U.A.E. fund. But there is only one fund to which each of the member states accorded legal personality. No one can bring an action to recover the money of the fund in any part of the world except the one duly authorised director general. The articles of agreement which were annexed to the federal decree of the U.A.E. and which thus became part of the law of the U.A.E. are no different from the memorandum and articles of a limited liability company established under the law of England. It is beyond dispute that if the fund had been incorporated in the U.A.E. and nowhere else, the fund would have been recognised in this country as a legal personality. If the fund has been incorporated not only in the U.A.E. but also in a number of friendly foreign states recognised by the government of this country, it still has legal personality and is capable of suing in this country. The evidence by affirmation of Dr. Faquih, the present director general of the fund, is that the fund holds assets and has incurred liabilities in its own name in every part of the world. The fund has in its own name deposits in the London market which at 30 June 1989 exceeded U.S.$235m. The fund has brought proceedings in different parts of the world. It may safely be assumed that no one except Dr. Hashim and the other respondents has doubted that the fund is a separate corporate entity or has conceived the fanciful notion of the existence of more than one fund."

The effect of this passage is that the fund was a single and indivisible corporate entity whose legal personality had been created by being accorded the capacity of a corporate body under the law of its 21 participants. Thus, although the fund had in that sense "multiple incorporation" and "multiple nationality," it only had one organisation, head office, board of governors, executive board of directors and director general, one domicile and residence (U.A.E.) and one agreement by which it was governed but which was analogous to the memorandum and articles

of a limited liability company established in this country. Lord Templeman was in this passage endeavouring to emphasise that the "multiple incorporation" argument advanced on behalf of Dr. Hashim was fallacious because it was incorrect to suggest that the consequence of treating the domestic legislation of each state as "creating" a legal personality in the eye of the law of that state would be to bring into existence as many separate legal personalities as there were states.

In my judgment, the very simple explanation is that English law will only recognise a foreign entity as having legal personality and therefore a capacity to sue or be sued if such a body has been accorded legal personality under the law of a foreign state recognised by this country. In the case of a corporation one looks to see whether it has been incorporated under the law of a foreign state. In the case of an international organisation one looks to see whether it has been accorded the legal capacity of a corporation under the law of any of the member states or the state where it has its seat, if that state is not a member state. Where some or all of the member states have accorded to it the legal capacity of a corporation the English courts will also treat it as having the legal capacity of a corporation. The fact that several states have accorded to it that capacity under their law does not mean that there is more than one international organisation for the English courts to recognise, but merely that there is more than one factual basis upon which recognition can be accorded to the same organisation.

The interveners rely on certain passages in Lord Templeman's speech in support of the proposition that in case of conflict between the consequences of the conferment of legal personality amongst the various member states of an international organisation an English court looks to the law of the seat or headquarters state as the place where the international organisation has its domicile, as determinative of the particular attribute of legal personality in question. Mr. Veeder, on behalf of the interveners, draws attention in particular to a passage from Lord Templeman's speech, at p. 161. He there referred to an early 18th century decision of the House of Lords: Henriques v. Dutch West India Co. (1730) 2 Ld.Raym. 1532 and commented:

"In that case judgment was recovered by the Dutch company by producing in evidence the proper instrument whereby according to tha law of Holland they were effectually created a corporation there. In the present case the federal decree with the articles of agreement annexed suffices to prove incorporation of the fund in the U.A.E."

Lord Templeman then cited Lord Wright's speech in Lazard Bros. & Co. v. Midland Bank Ltd. [1933] A.C. 289, 297:

"English courts have long since recognised as juristic persons corporations established by foreign law in virtue of the fact of their creation and continuance under and by that law. Such recognition is said to be by the comity of nations."

On those authorities and on the evidence in the case before him to which he had referred Lord Templeman could at that point logically only have reached the conclusion that he reached that the courts of this country

could therefore recognise the fund as a legal personality created under the law of the U.A.E.: [1991] 2 A.C. 114, 162. But before arriving at that conclusion he cited three further authorities. The interveners rely heavily upon deployment by Lord Templeman of the first two of these cases. What he said was as follows, at p. 161:

"In Gasque v. Inland Revenue Commissioners [1940] 2 K.B. 80, Macnaghten J. held that a limited company was capable of having a domicile. Its domicile is the place of its registration and that domicile clings to it throughout its existence. In the present case the domicile and residence of the fund were clearly in the U.A.E. at the headquarters of the fund from which the fund operated. In Kuenigl v. Donnersmarck [1955] 1 Q.B. 515, 535, McNair J. accepted that the domicile of a limited company was the place of registration or the country in which it was incorporated and that: 'in so far as nationality can by analogy be applied to a juristic person, its nationality is determined in an inalienable manner by the laws of the country from which it derives its personality: . . .'"

Neither of these two cases was concerned with an international organisation. In Gasque v. Inland Revenue Commissioners [1940] 2 K.B. 80 the issue was whether the company was "a person resident or domiciled out of the United Kingdom" within section 18 of the Finance Act 1936 and it was held by Macnaghten J. in reliance, inter alia, on the judgment of Holmes J. in Bergner & Engel Brewing Co. v. Dreyfus (1898) 70 Am.St.R. 251, that the company in question being incorporated in this country, had its domicile here. In Kuenigl v. Donnersmarck [1955] 1 Q.B. 515 the issue was whether a company which was managed and controlled from Germany but whose registered office was in London was subject to the prohibition on trading with the enemy imposed on English companies by the Trading with the Enemy Act 1939. McNair J. held, following the Gasque and Bergner cases, that inasmuch as the domicile of a company was its place of incorporation so by analogy the nationality of a company was determined by the law of that place.

I was informed by counsel that, although these two authorities had indeed been cited to the House of Lords in argument, there was no available record of the proposition in support of which they had been relied upon. In particular, it does not appear to have been contended that the A.M.F. had a domicile or nationality or that it was that of the U.A.E. or that such domicile or nationality would lead the English courts any more readily to treat the fund as having legal personality than they would otherwise have been disposed to do. The submission on behalf of Westland that it was irrelevant to consider domicile or nationality once it was accepted that the U.A.E., being a friendly foreign state, had accorded legal personality to that organisation and that the English courts will recognise as a legal personality an international body accorded such legal personality by a member state is, in my judgment, unassailable as a matter of logic.

The most likely explanation for Lord Templeman's reference to nationality and domicile is to be found in his refutation of the multiple incorporation argument advanced on behalf of Dr. Hashim and the banks.

I have already cited that part of his speech in which he considered and rejected that argument: [1991] 2 A.C. 114, 162. Mr. Veeder, on behalf of the intervener, again points to the sentence "The domicile and residence of the fund are in the U.A.E. and nowhere else" as showing that Lord Templeman was treating domicile as intrinsically determinative of legal personality. However, in the context in which one finds those words I have no doubt that Lord Templeman was at that point deploying the twin concepts of domicile and residence in order to emphasise the point that there was only one international organisation with its seat or headquarters at one place - U.A.E. - in which sense alone it could be said to have domicile or residence in that place and that it was to that one body in that one place that each of the member states had "accorded legal personality." Similarly, a company might be accorded legal personality in many different states although its domicile was indivisible.

The relevance of the seat or headquarters of an international organisation to the question of recognition by the English courts is further considered by Lord Templeman at pp. 163-164. He referred to the request for advice by the Bank of England to the British Foreign and Commonwealth Office in 1978 as to the status under English law of banks and other financial entities set up by foreign states by treaty and which had legal personality conferred on them under the laws of foreign states. The reply was in the following terms [1978] B.Y.I.L. 346-348:

"In these circumstances, and on the assumption that the entity concerned enjoys, under its constitutive instrument or instruments and under the law of one or more member states or the state wherein it has its seat or permanent location, legal personality and capacity to engage in transactions of the type concerned governed by the law of a non-member state, the Foreign and Commonwealth Office, as the branch of the executive responsible for the conduct of foreign relations, would be willing officially to acknowledge that the entity concerned enjoyed such legal personality and capacity, and to state this."

Lord Templeman observed [1991] 2 A.C. 114, 163-164:

"It seems to me that it would be unthinkable for the courts of the United Kingdom applying the principles of comity to reach any other conclusion. It will be observed that the reply of the Foreign and Commonwealth Office stipulates that the international organisation for which recognition is sought must have acquired legal personality and capacity under the laws of one or more member states or the state wherein it has its seat or permanent location. This requirement is necessary because the courts of the United Kingdom cannot enforce treaty rights but they can recognise legal entities created by the laws of one or more sovereign states. A treaty cannot create a corporation but a sovereign state which is a party to a treaty can, in pursuance of its obligations accepted under the treaty, create a corporation which will be recognised in the United Kingdom. . . . In the present case the fund was given legal personality and capacity by the law of the state wherein it has its seat or permanent location. There is every reason why the fund should be recognised as a legal personality by the courts

of the United Kingdom and no reason whatsoever why recognition should be withheld."

Thus the U.A.E. qualified both as a member state and, on the alternative basis envisaged by the Foreign Office reply, because it was the state in which the fund had its seat or permanent location.

The A.M.F. case was thus concerned only with the question whether the fact that the fund had been accorded legal personality in the U.A.E. and other member states led to the conclusion that it also had legal capacity to sue in the English courts. It was not in any way concerned with the impact of the domestic legislation of U.A.E. or any other member state on the constitution or governance of the fund or upon the authority of the officers of the fund to represent it in transactions with third parties. Nor was it concerned with whether the English courts, having received evidence of the fund being accorded legal personality by one or more friendly foreign states which were members of it or by the state where its seat or permanent location was situated, would apply the law of the latter state to matters going to the constitution of the fund or the authority of its officers.

Mr. Veeder strongly urges that it is implicit in Lord Templeman's speech that in such a case the English courts must look exclusively to the law of the place of domicile of the international body, just as it would look to the law of the place of incorporation of a foreign corporation: see Dicey & Morris, The Conflict of Laws, 12th ed. (1993), vol. 2, p. 1111, rule 156(2).

I find no such implication. The issue never had to be considered in the A.M.F. case. There was no conflict between the according of legal personality by one state and that by the law of the place of location of the fund's seat, although the possibility of such conflict was suggested in argument. There is, in my judgment, nothing in Lord Templeman's refutation of the multi-incorporation argument which points to that solution. On the contrary, Lord Templeman's citation of his own speech in the Tin Council case [1990] 2 A.C. 418, 478, suggests that the clothing of an international organisation with legal personality in the state where its seat is located does not have the further consequence in law that the international organisation is converted into a corporation in all respects governed by the law of the seat country:

"Consistently with the treaty, the United Kingdom could not convert the I.T.C. into a United Kingdom organisation. In order to clothe the I.T.C. in the United Kingdom with legal personality in accordance with the treaty, Parliament conferred on the I.T.C. the legal capacities of a body corporate. The courts of the United Kingdom became bound by the Order of 1972 to treat the activities of the I.T.C. as if those activities had been carried out by . . . a body incorporated under the laws of the United Kingdom."

It is, in my judgment, clear from this passage that it was not perceived to be a legal consequence of the Order in Council (International Tin Council (Immunities and Privileges) Order 1972 (S.I. 1972 No. 120)) that I.T.C. was converted "into a United Kingdom organisation." Instead, its effect was that the courts of this country become bound "to treat the

activities of the I.T.C. as if those activities had been carried out by . . . a body incorporated" in this country. I conclude that the issue of the governing law of the A.O.I. is entirely at large in this court and I accordingly approach it from first principles.

The law governing the constitution, existence and representation of international organisations

It is contended on behalf of the intervener that, even if there is no support in the A.M.F. case [1991] 2 A.C. 114 for the proposition that the constitution, existence and representation of an international organisation is governed by the law of the place where it has its seat or domicile, nevertheless, by analogy with the English conflicts rule relating to foreign corporations (Dicey & Morris, The Conflict of Laws, 12th ed., p. 1111, rule 156(2)), the English courts should apply the same reasoning to an international organisation.

The explanation for the willingness of the English courts to recognise as a legal personality a body corporate which has been incorporated in a foreign friendly state is the comity of nations: Lazard Bros. & Co. v. Midland Bank Ltd. [1933] A.C. 289, 297, per Lord Wright, a passage which I have already cited. The same principle explains the readiness of the English courts to recognise as a legal personality an international organisation clothed with legal personality by the law of a member state or of the state where its seat or permanent location is located: the A.M.F. case [1991] 2 A.C. 114, 163, per Lord Templeman. Consistently with the application of this principle of comity English courts will apply the law of the place of incorporation as governing the constitution, existence and representation of the ordinary body corporate.

Where, however, a foreign friendly state has clothed an international organisation with legal personality and has thereby "created" a foreign corporation in the special sense of that word used by Lord Templeman in the A.M.F. case, fundamentally different considerations apply. The international organisation may have been clothed with legal personality by such a state, but the body thus clothed is no ordinary domestic entity but an international body created by treaty. Questions as to the meaning, effect and operation of its constitution in so far as they arise between the parties to the treaty are issues which, in the eye of public international law, can only be determined by reference to the treaty and to the principles of public international law. Once the material issues are inter-state issues, they can no longer be resolved by any body of domestic law. If the consequence of the clothing of an international organisation as a legal person by the state where its seat was located, or by a member state, were that, in English law, issues which arose as to the meaning, effect or operation of its constitution fell to be determined by reference to the law of that state, there would, in substance, be an application of the domestic law of that state to issues which would be likely to affect the existence or rights of the parties to the treaty. Any determination of the rights of the international organisation or its representation under or by reference to its own constitution must necessarily involve the rights of the participating states embodied in that very constitution as the product of their own treaty. It is thus difficult to conceive of a course more obviously contrary

to the comity of nations than the imposition as the governing law by the English courts of the domestic law of any one such member state, whether or not the seat of the organisation. To do so would be (a) at least potentially an affront to all the other member states whose domestic law was necessarily to be ignored and (b) inconsistent with a widely accepted principle of public international law to which member states would be likely to adhere, namely that an international organisation is a creature exclusively of public international law.

That conclusion could not be more apposite in a case such as this where the text of the treaty incorporated into the law of the foreign state in question included a provision expressly insulating the international organisation from the domestic law of any participating state. I refer to articles 1 and 8 of the treaty and article 9 of the basic statute. Articles 1 and 8 of the treaty provided:

"Article 1. The organisation enjoys full financial and administrative independence, and is not subject to the laws and systems in effect in the participating states."

"Article 8. The organisation will be exempted from laws and systems in effect in the participating states, and in particular from tax laws and regulations as well as exchange control regulations. Nationalisation, confiscation, sequestration or seizure of the organisation or its property is prohibited."

Article 9 of the basic statute provided:

"(1) The organisation is not subject to the laws and internal systems in effect in the participating states, including the laws and systems concerning taxes and customs, as well as monetary imports and exports systems, within the limits mentioned in article 11 of this statute. (2) Nationalisation, confiscation, sequestration or seizure of the organisation or its properties as well as its expropriation is prohibited."

If in such a case there were to be imposed a rule of English domestic conflicts law that such a treaty provision were to yield to the domestic law of the seat state, that would involve the application to issues likely to affect the member states of a body of law which they had expressly agreed was to be inapplicable. Such a rule would be eccentric by comparison with the approach of other states to the same matter and would be contrary to the comity of nations inasmuch as it would involve ignoring the express terms of the treaty.

If, in any given case raising issues the resolution of which will affect inter-state rights, it is asserted by one party that a body of domestic law, whether of the seat state or of any other, governs the constitution of an international organisation, that can only be because it is perceived by the party who asserts it that some legal advantage is to be gained by it from an inconsistency between the principles of public international law and those of the relevant body of domestic law. By enabling one party to rely on that inconsistency the English courts would be applying a conflicts rule which would be contrary to the general principle of public international law that inter-state issues are not amenable to resolution by the application

of the domestic law of a particular state. It was, no doubt, with such considerations in mind that in his dissenting judgment in the A.M.F. case [1991] 2 A.C. 114, 140F-H Bingham L.J. made the observations which I have already cited.

The great care with which the English courts strive to avoid decision-taking which would be likely to involve a determination of issues arising between foreign sovereign states is well illustrated by one part of the International Tin Council litigation, namely the application to strike out the winding up petition against the I.T.C. The judgment of Millett J. in In re International Tin Council [1987] Ch. 419, which was upheld by the Court of Appeal [1989] Ch. 309, although immediately concerned with the proper construction of sections 665 and 671 of the Companies Act 1985, is based on reasoning which, in my judgment, is particularly relevant to the issue which I have to decide. On the face of it the general words used in those two sections were wide enough to cover the I.T.C. The question for the court was whether on their proper construction the wide general words used were such as to cover the winding up of international organisations such as to I.T.C. Millett J. held that such a construction would be contrary to the presumed intention of Parliament. He observed, [1987] Ch. 419, 450-451:

"Both sections 665 and 671 are enacted in general terms. Literally construed, they are both capable of applying to international organisations, including international organisations of which the United Kingdom is a member. But it is obvious that section 671 at least does not do so. Parliament cannot be taken to have intended to confer, by general words alone, the jurisdiction to interpret the terms of an international treaty and to enforce the obligations arising thereunder between independent sovereign states, a jurisdiction at once unprecedented and incompatible with basic principles of English law. The remaining question, therefore, is whether Parliament should be taken to have intended, by the general words of section 665, to confer on the court jurisdiction to wind up an international organisation established by treaty between sovereign states, including an organisation of which the United Kingdom is itself a member. When the nature and effect of a winding up order are considered, I have no doubt that the answer here also must be in the negative. An affirmative answer to that question would impute to Parliament an intention to confer, by general words only, a jurisdiction incompatible with our constitutional practice and with established principles of international law, and which would be incapable of exercise, in the case of an organisation of which the United Kingdom was a member, without putting the government of the United Kingdom in breach of its treaty obligations. The exercise of the jurisdiction would constitute an interference by the court with the ability of the executive, albeit in a limited sphere, to conduct its relations with foreign states, a function which under our constitution is reserved to the Royal Prerogative, and with the ability of other sovereign states to conduct their relations with each other. It would alter the status of the organisation charged with the function of administering the provisions of an international

treaty and would be incompatible with the independence and international character of the organisation."

He then referred to a passage from Jenks, The Proper Law of International Organizations (1962), pp. 3, 8-9, which because it is very pertinent to the issue now before me I cite in full:

"If a body has the character of an international body corporate the law governing its corporate life must necessarily be international in character; it cannot be the territorial law of the headquarters of the body corporate or any other municipal legal system as such without destroying its international character. The law governing its corporate life will naturally cover such matters as the membership of the body, its competence, the composition and mutual relations of its various organs, their procedure, the rights and obligations of the body and its members in relation to each other, financial matters, the procedure of constitutional amendment, the rules governing the dissolution or winding up of the body, and the disposal of its assets in such a contingency . . .

"In the case of an international body corporate, as in that of a foreign corporation of municipal law, the personal law of the corporation must be considered together with the territorial law when we pass from the sphere of the law governing its corporate life to that of the law governing its operations within a particular jurisdiction. There is, however, a significant distinction between the two cases. In the case of foreign corporations the personal law yields to the territorial law in respect of such operations. The extent to which a foreign corporation is subject to the territorial law is determined primarily by the territorial law . . . each state determines how far its own public policy requires it to exercise authority over the operations of foreign corporations within its jurisdiction. It may well be considered an essential element in the concpet of an international body corporate that the extent to which its operations within the jurisdiction of a particular state are subject to the law of that state is limited by the obligations accepted by the state in recognising it as an international body corporate. . . . In [such] event the personal law of the international body corporate, so far from yielding to the territorial law, will by virtue of its character as an international obligation of the state concerned, determine the extent of the operation of the territorial law."

Millett J. then reached his conclusion in the following passage [1987] Ch. 419, 452:

"In my judgment, the position can be considered broadly. An international organisation like the I.T.C., whether incorporated or not, is merely the means by which a collective enterprise of the member states is carried on, and through which their relations with each other in a particular sphere of common interest are regulated. Any attempt by one of the member states to assume responsibility for the administration and winding up of the organisation would be inconsistent with the arrangements made by them as to the manner

in which the enterprise is to be carried on and their relations with each other in that sphere regulated. Sovereign states are free, if they wish, to carry on a collective enterprise through the medium of an ordinary commercial company incorporated in the territory of one of their number. But if they choose instead to carry it on through the medium of an international organisation, no one member state, by executive, legislative or judicial action, can assume the management of the enterprise and subject it to its own domestic law. For if one could, then all could; and the independence and international character of the organisation would be fragmented and destroyed. And if a member state has no such right, then a fortiori a non-member state has none. In my judgment, to impute to Parliament an intention, by general words only, to confer on the court a jurisdiction contrary to these principles and without precedent, is unacceptable."

The Court of Appeal concluded that the right approach was to decide whether Parliament could not reasonably have intended to include an "association" such as the I.T.C. within the general words of section 665 and for this purpose to investigate the nature of the international organisation as created by the international agreement by which it was founded. Having done so, it concluded that the reasoning of Millett J. in the passage which I have cited was "unanswerable:" [1989] Ch. 309, 330G.

The approach of the court to the problem of statutory construction which arose in that case is helpful inasmuch as it provides some indication of the route by which the court ought to arrive at the applicable common law rule in this case. In excluding I.T.C. from the application of the general words in the statutory provisions the courts looked both to the general principles of public international law expressed in the passage cited from Dr. Jenks and to the nature of the organisation as defined by its founding treaty. There was no question but that the I.T.C. was recognised in English law as having legal personality, by virtue of the Order in Council of 1972, made pursuant to the International Organisations Act 1968, and that London was the headquarters of the I.T.C. Nevertheless the combined effect of the accepted principles of public international law relating to international organisations and the impossibility of applying the procedures and principles of English insolvency law consistently with the terms of the founding treaty or with the relevant principles of public international law was held to be to restrict the scope of the general words in sections 665 and 671 to exclude an association such as I.T.C. In arriving at this conclusion neither Millett J. nor the Court of Appeal regarded as relevant the fact that England was the seat of the organisation.

Inasmuch as the common law rule is at large before this court, there is, in my judgment, every reason in principle why the approach of the common law should be consistent with that of public international law unless there is some controlling common law principle to the contrary; for it is part of English public policy "that our courts should give effect to clearly established rules of international law:" Oppenheimer v. Cattermole [1976] A.C. 249, 278, per Lord Cross of Chelsea and see also Trendtex

Trading Corporation v. Central Bank of Nigeria [1977] Q.B. 529, 553, per Lord Denning M.R. In this case there is no countervailing common law principle. Moreover, for English law to require that the proper law of the A.O.I. should be that of its seat state in circumstances where the founding treaty expressly excluded that body of law would be to arrive at a conclusion analogous to that which the courts in In re International Tin Council [1989] Ch. 309 rejected as being one which Parliament could not reasonably have intended to be enacted by general words in the Companies Act 1985. The fact that in that case this country was a party to the founding treaty in question but in the case of A.O.I. it is not gives rise to no logical distinction. The conclusion that the proper law of the constitution of an international organisation is the law of its seat state in complete contradiction to the terms of its founding treaty is contrary to principle and must be rejected. For these reasons I have no doubt whatever that the proper law governing the existence, constitution and authority of its officers to represent the A.O.I. is public international law.

In arriving at this conclusion I have referred to the terms of the treaty and the basic statute. That has been a permissible course, without transgressing the frontiers between justiciability and non-justiciability. In order to identify the precise nature of the entity for the purpose of ascertaining by what body of law its constitution is to be governed under English law by which the A.O.I. has been accorded legal personality, the terms of the founding treaty are reviewable by this court as part of Egyptian domestic law. That, however, does not mean that in ascertaining the relevant proper law the English courts are required to shut their eyes to the fact that A.O.I. is an international organisation and that by the terms of the treaty its original members have expressly agreed to exclude the law of the seat state.

Before leaving this point I must refer to an argument advanced on behalf of the intervener to deal with the point that, if the constitution of the organisation were governed by the laws of the seat state, the organisation would, in the eyes of English law, be at the mercy of the government of the seat state. Only the body of domestic law of that state would be applicable to the organisation in English law. The answer to this obvious defect in the argument was that there would be a kind of juridical safety valve or control mechanism which would involve the English courts' declining to give effect to changes in the domestic law of the seat state which, for example, involved that state in attempting to take control of the organisation, and that such refusal to give effect to such laws could be based on principles of public policy. Mr. Veeder, on behalf of the intervener, in advancing this argument referred me to the judgment of Nourse J. at first instance in Williams and Humbert Ltd. v. W. & H. Trade Marks (Jersey) Ltd. [1986] A.C. 368, 379, where there is set out a most helpful analysis of the expropriation cases into two main categories (class I and class II cases) and five sub-categories. Class I includes all those cases where the English courts decline to recognise the expropriating legislation of foreign states either because they infringe the principles of human rights or because they discriminate against British nationals in time of war. Class II includes all those cases where, although recognising as laws the domestic

expropriating legislation in question, the English courts will not enforce such laws. Mr. Veeder submitted that an unjustifiable attempt by a seat state to take control of an international organisation would fall within Nourse J.'s class (2B) - "foreign laws which purport to confiscate property situated in this country."

I am unable to accept this submission for a number of reasons. First, Nourse J.'s class (2B) deals with foreign expropriatory laws purporting to expropriate property situated in this country. However, as Nourse J. observed, this is the consequence of "application of the wider rule that English law will not enforce foreign laws which purport to have extra-territorial effect." In other words, English law looks to and only to the lex situs in order to ascertain title to the property, a point strongly made by Lord Templeman, at p. 428B-E, when the matter got to the House of Lords. In such a case, the foreign legislation will be enforced against property within the jurisdiction of the foreign state, provided that the legislation is not discriminatory within class I. Similarly, if the expropriation is of shares in a company incorporated in the foreign state, the English courts will both recognise and enforce it. Once the laws are outside class I there is no investigation of fairness of compensation or justification for expropriation. To do otherwise would be "a serious breach of international comity:" see Aksionairnoye Obschestvo A.M. Luther v. James Sagor & Co. [1921] 3 K.B. 532, 558-559, per Scrutton L.J.

There is, in my judgment, nothing in the Williams and Humbert Ltd. case [1986] A.C. 368 or in any of the other expropriation cases to which I have been referred which suggests that in circumstances remotely analogous to those postulated by Mr. Veeder the English courts would decline on grounds of public policy to enforce the foreign domestic law of the place of the seat of an international organisation, of which this country was not a member, merely because that domestic law expropriated the assets of the organisation or otherwise took control over it, any more than if the assets were those of a company, or the organisation was a company, incorporated in the state in question.

In reality once one treats the domestic law of the seat state as the governing law of the organisation, English law cannot avoid enforcement of that domestic law - whatever it does to the organisation. Public policy could not come to the rescue unless the basis for its exercise were the inconsistency between the otherwise applicable domestic law and the principles of public international law. That has never been held to be a basis for withholding enforcement (save in class I cases). It would indeed be contrary to comity to refuse enforcement and, above all, it would require the English courts, contrary to the principles of non-justiciability, to judge whether the foreign state's domestic legislation was sufficiently contrary to public international law to justify the intervention of the relevant principle of public policy.

These objections are not only insuperable, but they support the conclusion that the proper law is public international law. If it became a principle of English law that the proper law were the domestic law of the seat state, subject to a public policy control mechanism, these courts would be forced into the position of sitting in judgment between the seat state and the rest of the organisation. Any solution to the problem

which had that result would be contrary to principle and should be rejected.

Finally, the very principle of public policy which would, on this argument, justify intervention and refusal to enforce domestic laws of the seat state - that English law should give effect to public international law where not inconsistent with other specific rules of English law (see Trendtex Trading Corporation v. Central Bank of Nigeria [1977] Q.B. 529 and Oppenheimer v. Cattermole [1976] A.C. 249) - leads inexorably to the wholesale rejection of the domestic law of the seat state as the proper law, which is the whole foundation of the intervener's argument.

In view of my decision that the proper law governing the constitution, existence and representation of A.O.I. is public international law and not Egyptian domestic law, it is unnecessary to investigate two other issues to which no little time and effort were devoted in the course of the hearing, namely: (i) whether in Egyptian law the effect of Law No. 30 was to create a new organisation or merely to continue an existing organisation; and (ii) whether in the circumstances of the conduct of the three Gulf states in May 1979 there was any principle of justifiable response or necessity in public international law which would have justified Egypt in taking the course it did in passing Law No. 30.

As to issue (i), its relevance arose only if the proper law were Egyptian law. In that event, the authority of the officers of 1979 A.O.I. to pursue the arbitration and litigation on behalf of A.O.I. could be established only if 1979 A.O.I. were, in Egyptian law, the same organisation as A.O.I. Having heard the expert evidence on Egyptian law given by the eminent Egyptian lawyers, Dr. Aktham Elkholy, on behalf of Westland, and Dr. A. Kamal Aboulmagd, on behalf of the interveners, I have no doubt that, although Law No. 30 included many provisions inconsistent with the original constitution of A.O.I., as provided for in the basic statute, it did not create a new organisation or corporation in Egyptian law. It is unncessary for present purposes to review the detailed evidence on Egyptian law. Although the management had been brought under the exclusive control of Egyptian government or military personnel, that which they were controlling was, in the eye of Egyptian law, the same corporate entity as that which had existed before the events of May 1979. Law No. 30 contains nothing which provides in terms that A.O.I. has ceased to exist and nothing which transfers its assets or employees to another distinct legal person. Accordingly, had it been necessary to do so, I should have found that, under Egyptian law, those authorised on behalf of 1979 A.O.I. after the enactment of Law No. 30 were thereby authorised to act on behalf of A.O.I.

As to issue (ii), Mr. Ian Brownlie submitted, on behalf of the intervener that, the three Gulf states having withdrawn from the A.O.I. in May 1979 at the time of Prince Sultan's declaration or very soon thereafter, the organisation would have been paralysed if Egypt had not immediately stepped in by passing Law No. 30 and replacing those members of the high committee and board of directors nominated by the three Gulf states.

Consequently, Egypt's action in passing and implementing Law No. 30 was a justifiable response on the grounds of necessity to the conduct of the other parties to the treaty. He submitted that such a course was entirely consistent with the principles of public international law, for in the face of the three Gulf states' invalid repudiation of the treaty, Egypt was permitted to take temporary, proportionate and necessary measures to avoid the paralysis of the A.O.I. Such measures could, in some circumstances, be justifiable in public international law, even if they were in breach of the terms of the treaty. Hence Egypt was entitled to implement Law No. 30, even if to do so would be inconsistent with the terms of the treaty.

Fundamental to Mr. Brownlie's submission is the premise that the three Gulf states committed a material breach of the treaty by their non-participation after March 1979, that Egypt was entitled to ignore that breach and unilaterallly to take lawful countermeasures to avoid the total paralysis of A.O.I. The validity of this argument in public international law is strongly challenged by Mrs. Rosalyn Higgins. She submitted that, properly understood, the doctrine of necessity became applicable only in cases where physical danger was contemplated. Nowhere had it ever been suggested until this case that it was open to a state to resort as a justifiable countermeasure to its own domestic legislation to change the constitution of an international organisation whose seat was in the territory of that state.

The problem about issue (ii) is that it involves considering (a) whether the conduct of the three Gulf states was such as to amount to a wrongful repudiation of the treaty and (b) whether in so far as Law No. 30 imposed a control regime for A.O.I. which differed from that in the treaty, it represented a justifiable response in public international law. Because of the principles of non-justiciability, an English court can decide neither issue (a) nor issue (b). Such issues can be decided only by reference to public international law, by a public international law forum and not by an English municipal court, for both issues necessarily involve the determination of whether foreign sovereign states are acting consistently or inconsistently with the rules of public international law. It is thus unnecessary to investigate what impact this part of the case has on these proceedings.

The intervener seeks to set aside Westland's garnishee order and to prevent its being made absolute. It is in this context essential for the intervener to block the order absolute, by positively asserting its authority as the one and only true A.O.I. which is the judgment debtor and owner of the bank deposits the subject of the garnishee order. This it can only do by tracing the authority of those who now represent it to those officials in control of 1979 A.O.I. pursuant to article 5 of Law No. 30 and Presidential Decree 343 of 1979, as is clear from paragraphs 10.1 to 10.4 of the intervener's points of defence. It follows that the source of authority of those now representing 1979 A.O.I. can only be traced through Egyptian municipal law. Indeed, the intervener could not plead itself into the position of being the true A.O.I. by reference only to the treaty and the basic statute without encountering a break in the line of authority of

its officers. That break can only be cured by the introduction of Law No. 30 and Presidential Decree 343.

Westland challenges that intervention on the ground that, since the proper law of A.O.I. is public international law and not Egyptian law, the latter and notably Law No. 30 and Presidential Decree 343 are irrelevant sources of authority. They do not assert, at least in their primary case, that Law No. 30 or Presidential Decree 343 were in breach of public international law, but rather that they are irrelevant to the authority of those who claim to represent A.O.I. because they are provisions of an irrelevant body of law. That is to say that Law No. 30 and Presidential Decree 343 emanate from a body of law other than that governing the constitution of A.O.I. and the authority of those officers acting for A.O.I.

In the course of his submissions Mr. Veeder, on behalf of the intervener, contended that, even if the proper law of A.O.I. were public international law, the burden of proving that Law No. 30 must be ignored lay on Westland. It was for them to establish that Law No. 30 was unjustifiable in the eye of public international law by showing that it was not a lawful countermeasure and this Westland could not do, first because that issue was non-justiciable in the English courts and second because, if it was, the doctrine of necessity provided adequate justification, as submitted by Mr. Brownlie.

This argument is clearly unsustainable. As I have said, the intervener can only make good its status as the same body as the judgment debtor respondent in the arbitration and owner of the bank deposits by proving that its authority based on Law No. 30 and Presidential Decree 343 is that of the original A.O.I. It must therefore (a) rely on those provisions of Egyptian municipal law and (b) prove that under the rules of the proper law, namely public international law, it is entitled to do so. That entitlement depends upon the non-justiciable issue whether Law No. 30 was a justifiable countermeasure in public international law which in turn depends on the further non-justiciable issue whether the three Gulf states acted in breach of the treaty. It follows that, once it is accepted, as I have held, that the proper law is public international law, the intervener cannot prove the authority of those who represent it to represent A.O.I. It therefore cannot prove that it is the same body as the judgment debtor or that it is the owner of the bank deposits the subject of these proceedings.

Having reached this conclusion, it would be quite inappropriate for me to express my views on those issues of public international law raised by the intervener's submissions as to justifiable response based on necessity or breach of the treaty by the three Gulf states. Those issues are non-justiciable in this court.

Conclusion

Having concluded that the proper law governing the constitution of A.O.I. is public international law and further that the intervener is unable to prove in the English courts that under that body of law it is the same entity as A.O.I., I reject the intervener's submission that in these courts it has standing to set aside the order of Clarke J. of 9 July 1993 giving leave to enforce the award against A.O.I. as a judgment.

The preliminary issues in relation to which this hearing has been directed must therefore be answered (subject to such further submissions as counsel may advance in the light of my judgment): (1) yes: it is not established that the intervener was a party to the arbitration agreement or first defendant in Westland's request for arbitration of 12 May 1980 or was the defendant against whom the arbitration award of 28 June 1993 was made or is the judgment debtor; (2) it is not established that Herbert Smith is entitled to act on behalf of the judgment debtor. It also follows that Westland succeeds on its summons dated 10 March 1994 and that it will, accordingly, be ordered that the intervener be struck out of the proceedings.

Solicitors: Slaughter and May; Herbert Smith; Wilde Sapte.

[Reported by KATE O'HANLON, Barrister]