Williams and Humbert Ltd v W. & H. Trade Marks (Jersey) Ltd

JurisdictionUK Non-devolved
JudgeLord Scarman,Lord Bridge of Harwich,Lord Brandon of Oakbrook,Lord Templeman,Lord MacKay of Clashfern
Judgment Date12 December 1985
Judgment citation (vLex)[1985] UKHL J1212-1
CourtHouse of Lords
Date12 December 1985
Rumasa S.A. and Others
(Respondents)
and
Multinvest (UK) Limited and Others
(Appellants)
Williams and Humbert Limited
(Respondents)
and
W. & H. Trademarks (Jersey) Limited and Others
(Appellants)

[1985] UKHL J1212-1

Lord Scarman

Lord Bridge of Harwich

Lord Brandon of Oakbrook

Lord Templeman

Lord Mackay of Clashfern

House of Lords

Lord Scarman

My Lords,

1

I have had the advantage of reading in draft the speeches to be delivered by my noble and learned friends, Lord Templeman and Lord Mackay of Clashfern. I agree with both of them: and for the reasons which they give I would dismiss the appeals.

Lord Bridge of Harwich

My Lords,

2

For the reasons given in the speeches of my noble and learned friends, Lord Templeman and Lord Mackay of Clashfern, with both of which I agree, I too would dismiss this appeal.

Lord Brandon of Oakbrook

My Lords,

3

I have had the advantage of reading in draft the speeches prepared by my noble and learned friends, Lord Templeman and Lord Mackay of Clashfern. I agree with both, and for the reasons which they give I would dismiss the appeal.

Lord Templeman

My Lords,

4

The first of these appeals arises out of an action, referred to by Nourse J. as "the trade marks action" whereby a company incorporated in England sues defendants in tort misfeasance and breach of fiduciary duty. The question is whether the plaintiff company, Williams & Humbert Ltd. ("Williams & Humbert"), is barred from relief in that action because the shares of the Spanish company, Rumasa S.A. ("Rumasa"), which holds all the issued shares of Williams & Humbert have been compulsorily acquired by the Spanish government.

5

The second of these appeals, arises out of an action referred to as "the banks' action" whereby three companies incorporated in Spain sue defendants in tort and misfeasance. The question is whether the plaintiff companies, Rumasa, Banco de Jerez S.A. ("Jerez") and Banco del Norte S.A. ("Norte"), are barred from relief in that action because all their shares have been compulsorily acquired by the Spanish government.

6

Nourse J. after hearing arguments which spanned seven working days concluded that the answer was obvious and that the ownership of the plaintiffs' shares in each action was irrelevant. He, therefore, refused to allow the defendants to plead the compulsory acquisition as a defence. The majority of the Court of Appeal (Fox L.J. and Sir John Megaw) agreed with Nourse J. Lloyd L.J. thought that the problem was more difficult and dissented. The defendants to the actions now appeal to this House, arguing that they are entitled to plead the compulsory acquisition as a defence.

7

The issued shares of the respondent Rumasa, a company incorporated in Spain, were formerly held by members of the Mateos family. Rumasa was the parent company of a group which included subsidiary companies, some incorporated in Spain and others incorporated outside Spain. Rumasa held all the issued shares in the respondent, Williams & Humbert incorporated in England and carrying on business as suppliers of sherry under the trade mark "Dry Sack." Rumasa also held a majority of the shares in the respondents Jerez and Norte, both incorporated in Spain and carrying on banking businesses. Thus the Mateos family owned the shares of Rumasa while Rumasa controlled Williams & Humbert, Jerez and Norte.

8

By a law dated 29 June 1983 enacted by the monarch and parliament of the Kingdom of Spain and taking effect on 30 June 1983, all the issued shares of Rumasa and of the subsidiary companies of Rumasa incorporated in Spain, including the shares of Jerez and Norte, were compulsorily acquired by the Spanish government. By the same law control of the management of Rumasa, Jerez and Norte and the other Spanish subsidiaries of Rumasa, vested in the general board of state ownership. Thus the Spanish government now owns the shares in and controls Rumasa, Jerez and Norte, while Rumasa controls Williams & Humbert.

9

The reasons advanced by the law dated 29 June 1983 for the compulsory acquisition of the shares in the Spanish companies comprised in the Rumasa group and for the assumption by the government of the management of those companies, were that the Rumasa group had embarked on rash speculations and reckless expansions of credit on a scale which threatened the stability of the Spanish economy, the livelihood of Spanish workers and the savings of bank depositors. The law dated the 29 June 1983 provided for the fair price of the shares thereby compulsorily acquired to be paid after a valuation and agreement with the former shareholders or, failing agreement, by a determination of the provincial jury on expropriation of Madrid.

10

The representatives of the Spanish government now charged with the management of the Rumasa group allege that while the Mateos family controlled Williams & Humbert through Rumasa, the Dry Sack trade mark was improperly diverted from Williams & Humbert to a company incorporated in Jersey and formed for the benefit of the Mateos family. The Spanish government have in the circumstances caused Williams & Humbert, as plaintiffs, to institute the present trade marks action in the Chancery Division of the High Court of Justice of this country against the Jersey company and against members of the Mateos family as defendants, for the recovery of the trade mark and for the payment of damages.

11

The representatives of the Spanish government now charged with the management of Jerez and Norte allege that while the Mateos family controlled Jerez and Norte, sums amounting to $46 million were improperly diverted from Jerez. The Spanish government have in these circumstances caused Rumasa, Jerez and Norte, as plaintiffs, to institute the banks' action in the Chancery Division against the defendants said to have been responsible for the impropriety. The plaintiffs claim discovery and recovery of the assets now representing the sum of $46 million and damages.

12

The defendants to the trade marks action and the banks' action are the appellants in these appeals. The appellants deny any impropriety or recklessness in the management of the affairs of the Rumasa group generally or in the management and control of Williams & Humbert, Jerez and Norte in particular. The appellants now seek to put forward an alternative defence. Even if the appellants, or some of them, have been guilty of misappropriation, breach of trust, misfeasance or other wrongs inflicted on Williams & Humbert or Jerez, nevertheless, according to the defence which the appellants now seek to plead, Williams & Humbert as plaintiffs in the trade marks action and Rumasa, Jerez and Norte, as plaintiffs in the banks' action:

"are not entitled to the relief sought or any relief by reason of the fact that the proceedings represent an attempt to enforce a foreign law which is penal or which otherwise ought not to be enforced by this court and further, or alternatively, that it would be contrary to public policy to grant the relief sought or any relief."

13

This pleading could be justified if English law abhorred the compulsory acquisition legislation of every other country, or if international law abhorred the compulsory acquisition legislation of all countries. But in fact compulsory acquisition is universally recognised and practised. As early as 1789 the Declaration of the Rights of Man, more recently repeated in the French Constitutions of 1946 and 1958, provided that no one should be deprived of property "except in case of evident public necessity legally ascertained and on condition of just indemnity." In the United States the Fifth Amendment to the Constitution of 1791 provided that private property should not "be taken for public use, without just compensation." In modern times written constitutions recognise compulsory acquisition in the public interest subject to the payment of compensation; see, for example, the 1949 Basic Law of the German Federal Republic, the 1949 Constitution of India, the 1969 South American Convention on Human Rights, and the written constitutions of the African states which achieved independence from colonial rule. The United Nations and European Conventions recognise compulsory acquisition in the public interest and in accordance with domestic law and international law. In the United Kingdom, the courts are bound to accept and enforce any compulsory acquisition authorised by the United Kingdom parliament and to recognise compulsory acquisitions by other governments subject only to limitations for the safeguarding of human rights.

14

There is undoubtedly a domestic and international rule which prevents one sovereign state from changing title to property so long as that property is situate in another state. If the British government purported to acquire compulsorily the railway lines from London to Newhaven and the railway lines from Dieppe to Paris, the ownership of the railway lines situate in England would vest in the British government but the ownership of the railway lines in France would remain undisturbed. But this territorial limitation on compulsory acquisition is not relevant to the acquisition of shares in a company incorporated in the acquiring state. If the British government compulsorily acquired all the shares in a company incorporated in England which owned a railway line between Dieppe and Paris, the ownership of that railway line would remain vested in the company, subject to any exercise by a French government of power compulsorily to acquire the railway line. In the present case, the Spanish government acquired all the shares in Rumasa and Jerez. Ownership of the shares in Williams & Humbert was and remained vested in Rumasa. Ownership of any right of action to recover the Dry Sack trade mark and to recover damages was and remained vested in Williams & Humbert. Ownership of any right of action to recover $46 million was and...

To continue reading

Request your trial
220 cases
  • JE Manghardt; Sim Leng Chua
    • Malaysia
    • High Court (Malaysia)
    • 1 January 1987
  • Yukos Capital S.a.r.L (a company incorporated in the Luxembourg) v OJSC Rosneft Oil Company (a company incorporated in the Russian Federation)
    • United Kingdom
    • Queen's Bench Division (Commercial Court)
    • 14 June 2011
    ...and illegal means, arranged and directed by the Russian state or government. Citing the words of Lord Templeman in Williams and Humbert Ltd. v W & H Trade Marks (Jersey) Ltd. [1986] 1 AC 368, it submitted that “no English judge could properly entertain such an attack launched on a foreign f......
  • JSC BTA Bank v Ablyazov and Others (No 4)
    • United Kingdom
    • Queen's Bench Division (Commercial Court)
    • 10 February 2011
    ...determined until the evidence in support of the Stay Applications has been heard. 14 Relying upon observations in Williams & Humbert Ltd. V W & H Trade Marks (Jersey) Ltd. [1986] AC 368, Total E & P Soudan v Edmonds & others [2006] EWHC 1136 and Tajik Aluminium Plant v Ermatov [2006] EWHC 2......
  • Koza Ltd v Koza Altin Isletmeleri as
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 7 October 2022
    ...35 The judge then analysed at [95] to [103] the decision of the House of Lords in Williams & Humbert Ltd v W&H Trademarks Jersey Ltd [1986] AC 368 ( Williams & Humbert), upon which the defendants relied. He noted that the case concerned misfeasance proceedings brought by English and nationa......
  • Request a trial to view additional results
1 firm's commentaries
  • The Revenue Rule In Tax Law
    • Canada
    • Mondaq Canada
    • 19 May 2023
    ...recognized that the revenue laws of one state have no force in another."); Williams & Humbert Ltd. v. W&H Trade Marks (Jersey) Ltd., 1986 1 All E.R. 129, 133-34 (H.L.) (Although the "revenue laws may in the future be modified by international convention or by the laws of the European Econom......
8 books & journal articles
  • CONTEMPT ORDERS AND JUDICIAL “ATTACHMENT” OF EQUITABLE PROPERTY
    • Singapore
    • Singapore Academy of Law Journal No. 2017, December 2017
    • 1 December 2017
    ...also Novello & Co Ltd v Hinrichsen Edition Ltd[1951] Ch 595; cfWilliams & Humbert Ltd v W & H Trade Marks (Jersey) Ltd[1986] AC 369; [1986] 1 All ER 129. 74 See Pro Swing Inc v Elta Golf Inc[2006] 2 SCR 612. 75 One must not be misled by the enforcement terminology to suppose that nothing li......
  • Litigation
    • United Kingdom
    • Construction Law. Volume III - Third Edition
    • 13 April 2020
    ...FCA 869. 702 McKay v Essex Area Health Authority [1982] QB 1166 at 1191, per Griiths LJ; Williams & Humbert Ltd v Trade Marks Jersey Ltd [1986] 2 WLR 24 (HL(E)); Cheick Ltd v JDM Associates (No 3) (1989) 22 Con LR 36 at 47–48, per Judge Fox-Andrews QC. 703 Walton Construction Pty Ltd v Illa......
  • The Liabilities of Financial Intermediaries and Their Advisers for Handling the Proceeds of Crime
    • United Kingdom
    • Emerald Journal of Financial Crime No. 9-3, March 2002
    • 1 March 2002
    ...WLR 1551. (29) [2001] All ER (D) 81. (30) 95 Cr App R67 CA. (31) [1999] Crim LR 414 CAC. (32) [1955] AC 491. (33) [1988] 1 WLR 1204. (34) [1986] AC 368. (35) Discussed above, see ref. 3. Michael Brindle QC, Fountain Court Chambers, Temple, London Former managing director disqualified for 'p......
  • Obtaining mareva injunctions and related orders against FFSH re assets
    • Barbados
    • Caribbean Law Review No. 8-2, December 1998
    • 1 December 1998
    ...courts have refused to enforce foreign laws where they infringe human rights: Williams & Lambert Ltd. v. W&H Trade Marks (Jersey) Ltd. [1986] A.C. 368,428. It may also give a restrictive recognition of the judgment, stopping short of granting it conclusive or binding effect, or readily reco......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT