Estate of Michael Heiser and 121 Others v The Islamic Republic of Iran
| Jurisdiction | England & Wales |
| Judge | Mr Justice Stewart |
| Judgment Date | 31 July 2019 |
| Neutral Citation | [2019] EWHC 2074 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ12X03803 |
| Date | 31 July 2019 |
Mr Justice Stewart
Case No: HQ12X03803
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Professor Dan Sarooshi QC and Peter Webster (instructed by DLA Piper UK LLP) for the Claimants
Simon Rainey QC and Paul Henton (instructed by Eversheds Sutherland (International) LLP) for the Defendants
Hearing dates: 2–5, 22, 31 July 2019
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
The Judgment Plan
| Paragraph | |
| A. INTRODUCTION | 1–46 |
| A1. The Applications and Issues | 1–9 |
| (a) The Preliminary Issues | 5–6 |
| (b) Outline of other applications not covered by the preliminary issues | 7–9 |
| A2. Procedural Background | |
| B. THE STATE IMMUNITY ISSUES | |
| B1. Have the Defendants submitted to the jurisdiction? | |
| B2. Section 31 of the 1982 Act | |
| B3. Requirement under section 31(1)(a) | |
| (a) Is presence required? | |
| (b) Were the Defendants Present in the US | |
| B4. Requirement under section 31(1)(b) | |
| (a) The UK and US personal injury exceptions to the State Immunity defence | |
| (b) Construction of the hypothesis in section 31(1)(b) | 101–118 |
| (c) Article 6 ECHR and Benkharbouche | 119–133 |
| (d) Construction of section 5 State Immunity Act 1978 | 134–160 |
| (e) Decisions of Courts in other EU states | 161–165 |
| (f) The Acosta Judgment | 166–174 |
| (g) The Commercial Transaction Exception | 175–186 |
| B5. Summary of decision on State Immunity Issues | 187 |
| C. THE SERVICE ISSUES | 188–240 |
| C1. Section 12(1) and 12(5) of the 1978 Act: preliminary | 188–192 |
| C2. Were proceedings served on 10 February 2014? | 193–224 |
| C3. Service of the Default Judgment | 225–240 |
| D. APPENDIX: INFORMATION IN RELATION TO THE US JUDGMENTS |
A. INTRODUCTION
A1. The Applications and Issues
There are two applications before the Court. Both are made by the Defendants. The first is dated 17 October 2014 (“the first application”). The second is dated 11 December 2018 (“the second application”).
The first application seeks Orders that:
1) the Order of Master Cook dated 23 July 2014 permitting the Claimants to enter default judgment be set aside
2) any default judgment entered pursuant to the Order of Master Cook or otherwise be set aside
3) the Order of Mr Justice Singh dated 2 October 2012 permitting the Claimants to serve the proceedings out of the jurisdiction be set aside
4) claims in the proceedings be dismissed; and
5) the Claimants pay the Defendants' costs of the proceedings
The brief reasons given on the application notice are:
“The Orders are sought because the Defendants are immune from the jurisdiction of the Court in these proceedings pursuant to section 31 of the Civil Jurisdiction and Judgments Act 1982, which lays down a statutory prohibition against the Court recognising and enforcing the judgments against the Defendants. Any default judgments entered in the proceedings is contrary to section 31 of the Civil Jurisdiction and Judgments Act 1982 and should be set aside pursuant to paragraph 4 of the Order of Master Cook and/or CPR 13.3. Further, because the Defendants are immune from the jurisdiction of the Court, no Order for service out of the jurisdiction should have been made and the proceedings should be dismissed for want of jurisdiction.”
It was made clear that reasons for seeking those Orders would be further particularised. At that stage the Defendants did not have a full record of the proceedings.
The second application is to set aside the Order dated 25 May 2018 (the “alternative service Order”), which provides that service on the Defendants of the Order of Master Cook dated 23 July 2014, and other documents in the proceedings, can take place by the Foreign and Commonwealth Office and/or the British Embassy in Tehran transmitting documents via email to the Iranian Ministry of Foreign Affairs in Iran, at Info@mfa.gov.ir or any other appropriate email address, and/or purported service of the alternative service Order and/or purported service of any documents pursuant thereto.
The Preliminary Issues
In a Consent Order made by Goose J on 7 November 2018 the following preliminary issues were ordered to be heard:
“The Service Issues”
a) Whether the Defendants have been validly served with the proceedings on 10 February 2014 or otherwise;
b) If the Defendants do make an alternative service set aside application 1, whether the 25 May 2018 Order for alternative service should be set aside and/or whether service of the Order of Master Cook made on 23 July 2014 and accompanying documents was validly effected.
(“the Service Issues”)
“The State Immunity Issues”
Whether the Defendants are immune from the jurisdiction of the English Courts pursuant to the State Immunity Act 1978 and/or section 31 of the Civil Jurisdiction and Judgments Act 1982 or otherwise.
(“the State Immunity Issues”)
The evidence before me is as follows:
i) Second witness statement of Mark Howarth 2, solicitor for the Defendants. This statement is dated 11 January 2019.
ii) Witness statement of Sean William McGuiness, solicitor for the Claimants. This witness statement is dated 15 March 2019.
iii) Witness statement of Curtis C. Mechling. Mr Mechling is an American lawyer at the law firm Stroock & Stroock & Lavan LLP, the attorneys for a number of the Claimants. His witness statement is dated 15 March 2019.
iv) Third witness statement of Jeremy Edward Needham Andrews. Mr Andrews is a solicitor for the Claimants. His witness statement is dated 15 March 2019.
v) Witness statement of Laina C. Lopez. Ms Lopez is an American lawyer acting on behalf of the Defendants. Her witness statement is dated 12 April 2019.
vi) Third witness statement of Mark Howarth. This statement is dated 12 April 2019.
vii) Report of Professor Michael D Ramsey dated 12 April 2019. This was served on behalf of the Defendants. Professor Ramsey is Professor of Law at the University of Santiago School of Law in Santiago, California.
viii) Report of Professor David P Stewart. This report is dated 17 May 2019 and was served on behalf of the Claimants. Professor Stewart is Professor of Practice at Georgetown University Law Center, Washington DC.
ix) Affidavit of Shale D Stiller. Mr Stiller is an American lawyer and partner in DLA Piper LLP (US) in Baltimore, Maryland.
Outline of Other Applications not covered by the preliminary issues
There are other applications made by the Defendants which are not subject to the preliminary issues I have to determine.
The first is an application dated 25 June 2015 which included amending the set aside application to include limitation issues. These concern information on limitation of claims relevant to without notice applications made by the Claimants in the early stages of the proceedings. This application is referred to as “the Amendment Application”. If the Defendants do not succeed on the preliminary issues, there will be further matters for the Court to determine on another occasion. These are applications that:
i. The proceedings are time barred in respect of several of the Judgments.
ii. The proceedings/service thereof should be set aside for alleged breach by the Claimants of their duties of full and frank disclosure.
iii. It would be contrary to public policy to enforce the Judgments.
The second is an application made on 29 August 2018. The Defendants applied for a retrospective extension of time in which to serve an acknowledgement of service in the proceedings; alternatively relief from sanctions if and insofar as necessary. This has been referred to as “the Protective Application”. This application is no longer of relevance. In the recitals to the Order of Goose J, the Defendants undertook to file an Acknowledgment of Service indicating an intention to challenge jurisdiction. The Claimants agreed that the Defendants did not need the permission of the Court to do so. That Acknowledgment of Service was filed on 11 December 2018.
A2. Procedural Background
On 8 June 2012 Mr Stiller swore an affidavit in these proceedings. He exhibited 12 Judgments of the United States District Court for the District of Columbia (“the Judgments”). The Judgments arise out of terrorist incidents occurring in a number of countries in the Middle East. There is also one ( Acosta) which took place in New York. In the Appendix to this Judgment I give further details of relevant sections of the Judgments. It must be appreciated that each of the Judgments reflects terrible personal tragedy. However, the issues I have to decide involve the application of law and procedure. There is no discretion to be exercised.
On 5 July 2012 the Claimants issued the Claim Form and Particulars of Claim seeking to enforce the Judgments. Application was made without notice for permission to serve the proceedings out of the jurisdiction. The application was requested to be dealt with on the papers.
Walker J sent emails to the Claimants raising concerns about jurisdiction and state immunity.
On 14 August 2012 the proceedings were transferred from the Commercial Court to the Queen's Bench Division. This was at the Claimants' request, following a question raised by Walker J as to the appropriateness of the Commercial Court.
On 14 September 2012 the Claimants provided written submissions addressing Walker J's concerns. The...
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