Greek Supreme Court Ruling on the maxim ne impediatur legatio

Άρειος Πάγος, i.e. the Hellenic Supreme Court, issued its first ruling on the immunity of foreign states against execution. The judgment follows the path introduced by the German Constitutional Court in the famousPhillipinische Botschaft case from 1977 

[SC 29.11.2017, decision nr. 1937/2017, unreported] 

 THE FACTS

Appellant: K.P., a lawyer and legal counselor of the Libyan State in Greece.

The appellee: The State of Libya [SoL], formerly the Great Socialist People’s Libyan Arab Jamahiriya

 The dispute began with the opposition filed before the Athens First Instance Court (FIC) on 31/8/2009 by the SoL against the attachment of its bank account in the National Bank of Greece by K.P. for the sum of 2.000.001 €. The opponent requested the annulment of the attachment because, 
     a. it was imposed on an asset not subject to seizure, and

1.   it is not in line with the leave of the Minister of Justice, granted in accordance with Article 923 Greek Code of Civil Procedure (CCP)[1].

The Athens FIC upheld the opposition and ordered the annulment of attachment[2]. The appeal of K.P. was dismissed[3]. Finally, K.P. filed an appeal on points of law. He invoked one of the standard grounds for a second appeal (cassation) in Greece, i.e. the erroneous interpretation of substantive law by the instance courts (Art. 559 point 1 CCP). 

THE RULING

1970. The relevant law in question was the 1961 Vienna Convention on Diplomatic Relations, ratified from Greece by law decree Nr. 503/1970. Article 22.3 of the Vienna Convention provides that: “The premises of the mission, their furnishings and other property thereon and the means of transport of the mission shall be immune from search, requisition, attachment or execution”.

1. The Supreme Court interpreted the above rule as follows: The purpose of the privileges and immunities established with the above, as well as other provisions of this Convention, is not to benefit individuals, but to ensure the efficient performance of the functions of diplomatic missions, in their capacity as representatives of a foreign State, as expressly stated in the preamble of the Convention. Those provisions, in conjunction with Articles 951[4], 1022[5]Greek CCP and 966[6] Civil Code, lead to the conclusion that assets not subject to attachment are also the ones located in Greece, and belonging to a foreign government, even if they do not form part of the diplomatic mission’s equipment, as long as they have been intended to serve other public purposes. 

Further on, pursuant to the resolution adopted by the Institute of International Law in 1954, which is prevailing international practice since then, it is exceptionally admissible to grant injunctions and impose enforcement measures only to those assets related to trade and economic activities of a foreign State. The same path is followed by the 2004 United Nations Convention on Jurisdictional Immunities of States and Their Property, based on the International Law Commission’s 1991 draft, adopted by the UN General Assembly, which however has not yet entered into force; still, it is considered that it already codifies pre-existing customary law, establishing the rule of limited enforcement immunity as a rule of customary international law. 

Thus, it is  inter alia examined ad hoc and in concreto, whether state banks, or bank accounts in banks of the forum state, constituting ownership of a foreign State, do serve sovereign purposes (operational needs of a diplomatic mission), so as to enjoy immunity from execution, or trading purposes, which would lead to the opposite inference.

III. The SC referred subsequently to the judgment of the Athens CoA, which ruled as follows: “On 10/07/2009, K.P. seized in the hands of the National Bank of Greece the amount of 2.000.001 € from an account number belonging to the Great Socialist People’s Libyan Arab Jamahiriya [Libyan government]. The bailiff’s attachment report was served duly on the defendant under Article 134 CCP[7], as evidenced by the pertinent service certificate. The attachment was founded on an enforceable title issued by the Athens FIC[8], ordering the defendant to pay the amount of 2 million € as lawyer’s fees. A writ of execution was served to the defendant again according to Article 134 CCP. K.P. requested and received the necessary leave by the MoJ (pursuant to Art. 923 CCP)[9], on condition that execution will not be carried out on things [immovable or movable] serving the exercise of sovereign power [imperium], or those serving other, i.e. cultural and / or educational purposes. On 20.07.2009, the National Bank proceeded to the declaration stipulated under Article 985 CCP[10], by virtue of which it certified the existence of the requested amount in the respective bank account of the defendant. 

The Athens CoA referred then to the evidence produced by the State of Libya in the first instance, i.e. a certificate of the accredited Ambassador of the Great Socialist People’s Arab Jamahiriya in Greece, and the testimony of the witness, who was the superior Libyan diplomatic agent in the country: both certified that the seized account serves the operating expenses of the diplomatic mission / Embassy of Libya in Greece [payroll, rent, utility costs, etc]. In addition, it was evidenced that part of this sum is intended to be invested in the construction of a privately owned building for the Libyan embassy in Greece. Consequently, the enforcement was invalid, because the seized bank account was intended to finance the diplomatic mission, hence it serves sovereign duties of the Libyan government and enjoys immunity from enforcement under Article 22 of the Vienna Convention, which has been ratified both by the Hellenic Republic [1970] and the State of Libya [1977].

22. Considering all the above, the Supreme Court held that the instant rulings did not err in the application and interpretation of the law [Articles 22.3 Legislative Decree 503/1970, in conjunction with Articles 951, 1022CCP and 966 CC], and in the evaluation of existing evidence. In particular, and contrary to the assertions of K.P., the disputed seized bank account was intended to serve as a means of financing the diplomatic mission of the Libyan State; thus, it served the exercise of sovereign powers of the Libyan government.

COMMENTS

This is the first ruling of the Supreme Court dealing with the maxim ne impediatur legatio. Usually, the efforts of judgment creditors against foreign states were hindered by the strict refusal of the MoJ to grant a leave for execution. Article 923 CCP has been considered as compatible both with the Greek Constitution and the European Convention of Human Rights. The ECHR issued two judgments in this respect: KALOGEROPOULOU and OTHERS v. GREECE and GERMANY [Case Nr. 59021/00, issued on 12/12/2002], and VLASTOS v. GREECE [Case Nr.28803/07, issued on 16/04/2009]. The former forms part of the war reparations legal saga between relatives of Nazi atrocities victims in Greece and the Federal Republic of Germany; the latter is in much closer proximity with the Supreme Court ruling, since it is based upon similar facts, i.e. litigation of a Greek attorney at law against a foreign state for lawyer’s fees. The ECHR made no distinction between the two cases. In particular, in the Vlastos ruling, it simply made reference to its findings in the Kalogeropoulou case [see recitals 34-37 in the Vlastos judgment]. I expressed my hesitation to accept a verbatim interpretation in both cases, since I cannot understand how a solicitor’s fees case might destabilize the diplomatic relations of two countries, or at least as much as  the war reparations case, with its potential spill over effect [see note on the case VLASTOS v. GREECE,  Armenopoulos 2010, p. 282 et seq.].

However, as already noted, a leave was partially granted by the MoJ in the case at hand. Hence, the Supreme Court was confronted with a different set of issues. Admittedly, the ruling is devoid of a profound analysis in the subject matter. We found, however, a more in-depth elaboration in the CoA judgment: There, the court referred to a number of rulings issued in various jurisdictions [Germany, Austria, the Netherlands, USA, Italy, and Switzerland], in order to support its decision on a solid fundament.

The result is proving the major difficulties of judgment creditors against foreign states. The issue is of course not free from doubt, and a very good and up-to-date reading would be the thesis of Anja Höfelmeier, Die Vollstreckungsimmunität der Staaten im Wandel des Völkerrechts, Beiträge zum ausländischen öffentlichen Recht und Völkerrecht, Bd. 271, Berlin : Springer, [2018], especially pp. 185 et seq.

[1] ‘Execution against foreign states may not take place without prior leave of the Minister of Justice’.

[2] Athens FIC 2386/2011, unreported.

[3] Athens CoA 1536/2013, Theory & Practice of Civil & Civil Procedure Law 2013, pp. 909 et seq., with note by MichaiIdis.

[4] On the enforcement of money claims.

[5] On the attachment of special assets.

[6] On non-fungible property.

[7] On the service of process abroad. Libya has not ratified the 1965 Hague Service Convention; there’s no bilateral convention in matters of judicial assistance between the two states.

[8] Decision 122/2008, unreported.

[9] Ministerial Decision Nr. 84485/ 25-6-2009, unreported.

[10] On the third-party declaration in garnishment proceedings.