Maduro Board of the Central Bank of Venezuela v Guaidó Board of the Central Bank of Venezuela
| Jurisdiction | England & Wales |
| Judgment Date | 05 October 2020 |
| Neutral Citation | [2020] EWCA Civ 1249 |
| Year | 2020 |
| Court | Court of Appeal (Civil Division) |
and
and
and
and
and
and
([2020] EWCA Civ 1249)
(Lewison, Males and Phillips LJJ)
England, Court of Appeal (Civil Division).
Governments — Recognition — Rival governments — Venezuela — Disputed 2018 Venezuelan presidential election — Whether Mr Maduro or Mr Guaidó President of Venezuela — Whether Maduro Board or Guaidó Board entitled to give instructions on behalf of Central Bank of Venezuela concerning its assets in England
Recognition — Whom United Kingdom Government recognizing as Head of State and Head of Government of Venezuela — Whether United Kingdom Foreign Secretary's statement constituting recognition of Mr Guaidó as Interim President — Whether United Kingdom Government's recognition of Mr Guaidó de facto or de jure — Whether United Kingdom Foreign Secretary's statement of recognition leaving open possibility of continuing implied recognition of Mr Maduro as de facto President — Whether a de facto recognition of Mr Guaidó would violate rule against intervention in internal affairs of a foreign State — “One voice” doctrine — Whether English courts obliged to accept United Kingdom Government's recognition of Mr Guaidó as conclusive — Foreign act of State doctrine — Whether challenges to validity, under Venezuelan law, of Mr Guaidó's legislative and executive acts justiciable in English courts
Diplomatic relations — Whether United Kingdom Government's continued diplomatic relations with Mr Maduro's representatives in England constituting implied recognition of Mr Maduro as de facto President — The law of England
Summary:2The facts:—After a contested Venezuelan presidential election in 2018, a conflict arose over the presidency. Mr Maduro, the incumbent President, claimed to have won the election, while Mr Guaidó, the President of the National Assembly, argued that the election was flawed and had left the presidency vacant, and that, on those grounds, he had become interim President under the Venezuelan Constitution, pending fresh elections.
A dispute arose over who was entitled to control over the assets in England of the Central Bank of Venezuela (“BCV”): a board of the BCV appointed by Mr Maduro (“the Maduro Board”) or an ad hoc board appointed by Mr Guaidó (“the Guaidó Board”). The assets included approximately $1.95 billion in gold reserves, held by the Bank of England, and $120 million in proceeds from a gold swap contract, to be paid by Deutsche Bank.
After Deutsche Bank received conflicting instructions regarding the payment of the proceeds of the gold swap contract, it issued an arbitration claim
form requesting the appointment of receivers to hold and manage BCV's assets. The court appointed the receivers, and the proceeds were transferred to them, following which the Maduro Board and Guaidó Board served their statements of case.The Maduro Board claimed to be the validly appointed board of the BCV because it was appointed by Mr Maduro as President of Venezuela. The Guaidó Board, on the other hand, claimed to be an ad hoc board of the BCV, appointed by Mr Guaidó to administer the BCV's assets abroad. It argued that Mr Guaidó was entitled to make those appointments based on the Transition Statute, passed by the National Assembly on 5 February 2019, which confirmed that Mr Guaidó was the interim President of Venezuela and gave him the power to appoint ad hoc boards to various public bodies, for the protection of their assets. The Guaidó Board also relied on the fact that the UK Government had recognized Mr Guaidó as the “constitutional interim President of Venezuela”, a decision which, it argued, the English courts were compelled to accept as conclusive under the doctrine that, in matters of foreign policy, the courts and the executive should speak with one voice.
The Maduro Board argued that the statement by the UK Government3 did not amount to a recognition of Mr Guaidó and, if it did, it was a recognition of him as de jure President of Venezuela, which did not affect the continuing recognition of Mr Maduro as de facto President. It pointed to the UK Government's continued diplomatic relations with Mr Maduro's representatives, and the absence of such relations with Mr Guaidó, as evidence that the UK Government continued to recognize the government of Mr Maduro. It asserted that Mr Maduro continued to exercise the powers of head of State and head of government in Venezuela, and challenged the validity of Mr Guaidó's appointments, stating that they had been declared null and void in Venezuela. The Supreme Tribunal of Justice, Venezuela's highest court, had also declared that the appointment of Mr Guaidó as interim President, and the passing of the Transition Statute, were nullities.
The Guaidó Board argued that the decisions of the Supreme Tribunal of Justice should not be recognized because it was acting corruptly to support Mr Maduro and its decisions violated due process. The Guaidó Board further argued that the foreign act of State doctrine prevented the courts from considering any challenges to the validity, under Venezuelan law, of the legislation under which the appointments were made.
After hearing the arguments, the judge wrote to the UK Foreign and Commonwealth Secretary, seeking clarification on whom the UK Government recognized as the Venezuelan Head of State and Head of Government. The Director for the Americas at the Foreign and Commonwealth Office (“FCO”) replied, but did not provide a direct answer. Instead, he referred to the UK's policy of non-recognition, and a statement issued on 4 February 2019 by the then Foreign Secretary, which had recognized
Mr Guaidó as constitutional interim President of Venezuela, pending credible elections.On 14 May 2020, the Maduro Board filed separate proceedings in the name of the BCV, against the Bank of England, after it refused to accept instructions from the Board regarding Venezuela's gold reserves. The court joined the hearing of preliminary issues in the arbitration application issued by Deutsche Bank and the action against the Bank of England. The following preliminary issues arose for determination: (i) whom the UK recognized as the Venezuelan Head of State and Head of Government; and (ii) whether the English courts could adjudicate upon the validity, under Venezuelan law, of the legislative and executive acts by which the appointments were made.
The High Court held that: (i) the UK Government statement was a recognition of the status of Mr Guaidó as interim President and, for purposes of the case, that recognition was conclusive, pursuant to the “one voice” doctrine; (ii) the UK Government's recognition of Mr Guaidó as de jure President did not leave room for recognition of Mr Maduro as de facto President; (iii) the UK Foreign Secretary's statement did not amount to the recognition of a government, but was limited to recognition of Mr Guaidó as President; and (iv) any challenges to the validity of the Transition Statute, or Mr Guaidó's appointments, were not justiciable in the English court, because they were acts of the State of Venezuela, which the English court would treat as valid and effective, pursuant to the foreign act of State doctrine.
The Maduro Board appealed, arguing that: (i) the UK Government's decision to maintain full diplomatic relations with Mr Maduro's government, while declining to accord diplomatic status to Mr Guaidó's representatives, showed that the UK Government recognized Mr Maduro as the de facto President of Venezuela; (ii) the UK Government statement recognized Mr Guaidó as head of State de jure but not de facto; (iii) the “one voice” principle did not apply to recognition de jure, nor did it preclude the possibility that the UK Government continued to recognize Mr Maduro as head of State or head of government de facto; and (iv) if the UK Government had recognized Mr Guaidó as President de facto, such recognition would have been unlawful as it amounted to a prohibited intervention in the internal affairs of a foreign State.
Held (unanimously):—(1) It was a general policy of the UK Government not to recognize governments, but it was entitled to depart from that policy. The recognition of a foreign government by the UK could be either express or implied, de jure or de facto. It was possible for the UK Government to recognize one ruler or government de jure and another de facto. Where there was a recognized de facto ruler or government, the acts within the territory of that State by a rival ruler or government, even one recognized de jure, were to be treated as a nullity (paras. 67–85).
(2) A statement of recognition by the UK Government was conclusive, pursuant to the “one voice” principle, regardless of whether it referred to recognition de jure or de facto. While a statement as to recognition was conclusive as to what it said, it was for the court to determine what it meant. In case of ambiguity, the court could seek clarification, but it was not obliged to do so, nor was the UK Government bound to provide a clarification. If the terms of the statement were clear and unequivocal, it was not necessary to look beyond them (paras. 91–111).
(3) The UK Foreign Secretary's statement, viewed in context, was not unequivocal. It was conclusive in its recognition of Mr Guaidó as the de jure President of Venezuela, but left open the possibility that the UK Government continued to recognize Mr Maduro as de facto President. It was not possible to provide a definitive answer to the recognition issues before determining whether the UK Government: (i) recognized Mr Guaidó as President of Venezuela for all purposes...
To continue reading
Request your trial
-
Dynasty Company for Oil and Gas Trading Ltd v The Kurdistan Regional Government of Iraq
...Inc v Sarlie [1966] 1 WLR 440; [1966] 1 All ER 673, Lyell J and CADeutsche Bank AG London Branch v Receivers Appointed by the Court [2020] EWCA Civ 1249; [2021] QB 455; [2021] 2 WLR 1; [2021] 1 All ER 719, CAErste Group Bank AG London Branch v JSC “VMZ Red October” [2013] EWHC 2926 (Comm); ......
-
Kuwait Investment Office v Hard
...ER 662, SC(E)Byrne v Financial Times Ltd [1991] IRLR 417, EATCentral Bank of Venezuela v Governor and Company of the Bank of England [2020] EWCA Civ 1249; [2021] QB 455; [2021] 2 WLR 1, CA; [2021] UKSC 57; [2022] 2 WLR 167; [2022] 2 All ER 703, SC(E)Chandhok v Tirkey [2015] ICR 527, EATDuff......
-
Kuwait Investment Office v Mr S Hard
...whether it evidences the status contended for. In Central Bank of Venezuela v Governor and Company of the Bank of England and others [2020] EWCA Civ 1249, at paragraph 71, Lord Justice Males had held, concerning the recognition of a government: ‘71. Recognition may be either express or impl......
-
The “Maduro Board” of the Central Bank of Venezuela v The “Guaidó Board” of the Central Bank of Venezuela
...Reed, President Lord Hodge, Deputy President Lord Lloyd-Jones Lord Hamblen Lord Leggatt Supreme Court Michaelmas Term On appeal from: [2020] EWCA Civ 1249 Guaidó Board Timothy Otty Sir Daniel Bethlehem QC Andrew Fulton QC Mark Tushingham (Instructed by Arnold & Porter Kaye Scholer LLP) Madu......