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You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Iran v The Barakat Galleries Ltd [2007] EWHC 705 (QB) (29 March 2007) URL: https://www.bailii.org/ew/cases/EWHC/QB/2007/705.html Cite as: [2007] EWHC 705 (QB) |
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
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B e f o r e :
____________________
Government of the Islamic Republic of Iran |
Claimant |
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- and - |
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The ![]() ![]() |
Defendant |
____________________
Philip Shepherd QC and David Herbert instructed by
Messrs Lane & Partners for the defendant
Hearing dates: 5 - 8 March 2006
____________________
Crown Copyright ©
Mr Justice Gray :
The Claim
The Preliminary Issues
"(1) Whether under the provisions of Iranian law pleaded in the Amended Particulars of Claim, [Iran] can show that it has obtained title to [the antiquities] as a matter of Iranian law and, if so, by what means;
(2) If [Iran] can show that it has obtained such title under Iranian law whether this court should recognise and/or enforce that title"
The parties' cases in summary
i. a Legal Bill regarding clandestine diggings and illegal excavations intended to obtain antiquities and historical relics which are according to international regulations made or produced one hundred or more years ago ("the 1979 Legal Bill");
ii. 1930 National Heritage Protection Act;
iii. Executive Regulations of the "National Heritage Protection" dated 3 November 3, 1930;
iii. Article 26, Civil Code.
i. Islamic Punishment Law, chapter 9;
ii. Decree issued by the Revolution Council in 1980 (Decree Concerning Export Prohibition of Antiquities, Works of Art and Gold and Silver Wares, decree no. 64434, 12 January 1980);
iii. Constitution of Iran, Article 83.
"Rule 3 English Courts have no jurisdiction to entertain an action:
(1) for the enforcement, either directly or indirectly, of a penal, revenue or other public law of a foreign state; or
(2) founded upon an act of state".
The First issue: approach to Iranian law.
"In resolving the disputes as to foreign law, I must be guided by the following principles:
(1) when faced with conflicting evidence about foreign law, I must resolve differences in the same way as in the case of other conflicting evidence as to facts (Bumper Development Corporation Ltd v Commissioner of Police for the Metropolis [1991] 1 WLR 1362 at 1368G);
(2) where the evidence conflicts I am bound to look at the effect of the foreign sources on which the experts rely as part of their evidence in order to evaluate and interpret that evidence and decide between the conflicting testimony (Bumper Corporation at 1369H ;
(3) I should not consider passages contained within foreign sources of law produced by the experts to which those experts have not themselves referred (Bumper Corporation at 1369D to G);
(4) it is not permissible to reject uncontradicted expert evidence unless it is patently absurd (Bumper Corporation at 1371B);
(5) In considering foreign sources of law I should adopt those foreign rules of construction of which the experts have given evidence (this principle underlies the principle that an English court must not conduct its own researches into foreign law);
(6) whilst an expert witness may give evidence as to his interpretation as to the meaning of a statute, it is not for the expert to interpret the meaning of a foreign document. His evidence will be limited to giving evidence as to the proper approach, according to the relevant foreign rules of construction to that document".
I adopt that approach in this case.
The Laws of Iran applicable to the determionation of the ownership of the antiquities.
"Since time immemorial Iran was ruled by absolute monarchs. The kingdom of Iran was the king's domain, i.e. his estate. It was as such that the kings acquired further territories, ceded territories and exchanged part of their kingdom with the neighbouring kings. The last evidence of the exercise of such power was exhibited in 1893. However, a short while after this date there was a Constitutional Movement in Iran and the king's domain became the Crown's, or government property. When the Iranian main laws were codified in the Civil Code of Iran (section 1 of which was approved in 1928) the internal 'government properties' legally replaced the king's domain".
"Section 3
On Properties which have No Private Owner
Article 26 as amended on 21-8-1370 A.H. equals 12-11-1991. Government properties which are capable of public service or utilisation, such as fortifications, fortresses, moats, military earthworks, arsenals, weapons stored, warships and also government furniture, mansions and buildings, government telegraphs, public museums and libraries, historical monuments and similar properties, and in brief, any movable or immovable properties which may be in the possession of the government of public expediency and national interest, may not privately be owned. The same applies to properties that have, in the public interest, been allocated to a province, county, region or town
Chapter 2
On Various Rights that
People May Have in Properties.
Section 1
On Ownership
Article 30 - Every owner has the right to all kind of disposal and exploitation of his property, except where the law expressly provides otherwise.
Article 31 No property may be taken out of its owner's possession except by the order of law.
Article 32 All products and appurtenances of properties whether movable or immovable, produced naturally or as a result of an action, follow the property and belong to the owner of the property.
Article 35 Possession indicating ownership is proof of ownership unless the contrary is proved.
Article 36 - Possession which is proved not to have derived from a valid or lawful transfer shall not be valid.
Chapter 4
On Found Articles and Lost Animals
Section 1
On Found Articles
Article 165 Anyone who finds an article in the desert or in a ruined place which is not inhabited and which is not privately owned, may take ownership of it and there is no need to declare it; unless it is evident that the article belongs to modern times, in which case it is subject to the rules applicable to articles found in an inhabited locality.
Chapter 5
On Treasure Trove
Article 173 - Treasure Trove means valuables buried in the ground or in a building and found by chance or accidentally.
Article 174 Treasure Trove whose owner is not known is the property of the finder.
Article 175 If a person finds treasure trove in the property of another person, he must inform the owner of the property. If the owner of the property claims ownership of the treasure trove and proves it, the treasure trove belongs to the person claiming ownership.
Article 176 Treasure Trove found in ownerless land belongs to the person who finds it.
Section 2
On Tortious Liability
Subsection 1
On Usurpation
Article 308 - Usurpation is the assumption of another's right by force. Laying hands on another person's property is also considered usurpation.
Article 309 If a person prevents an owner from possessory treatment of his property without himself assuming control of it, he is not considered a usurper, but he destroys the said property or causes its destruction, he shall be liable.
.
Article 317 The owner can claim the usurped property or, if it lost, its equivalent or the value of the whole or part of the usurped property from either from the original or successive usurpers at his option.
".
"Article 1 Observing the Article 3 of this Law, all artefacts, Buildings and places having been established before the end of the Zandieh Dynasty in Iran [late 19th Century], either movable or immovable, may be considered as national heritage of Iran and shall be protected under the State control.
Article 10 Anyone who accidentally or by chance finds a movable property which according to this Law may be considered as an item of national heritage, although it has been discovered in his/her own property shall be obliged to inform the Ministry of Education or its representatives as soon as possible; in case the pertinent State authorities recognise the property worthy to be registered in the List of National Heritage, half of the property or an equitable price as considered by qualified experts shall be transferred to the finder, and the State shall have the authority, at its discretion, to appropriate or transfer the other half to the finder without recompense.
Article 11 The State has the exclusive right for land digging or excavation in sites to explore national relics.
Article 13 Excavations in private lands shall require the owner's consent as well as the permission of the State .
Article 14 During scientific and commercial excavations in one location and one season, if the State discovers the objects directly, it may appropriate them all, and if the discovery is performed by others, the State may choose and possess up to ten items out of the objects of historical artistic value; half of the rest of the objects shall be transferred freely to the discoverer, and the other half shall be appropriated by the State. In case all the discovered objects do not exceed ten items and the State appropriate them all, the expenses of the excavation shall be refunded to the discoverer ..
Article 16 The violators of Article 10, those who perform excavations operations without the State permission and information, though in their own lands, as well as those who illegally take items of national heritage out of the country shall be fined as much as twenty to two thousand Tomans, and the discovered objects shall be confiscated [in Farsi, "zabt"] in the interest of the State
Article 17 Those who intend to adopt dealing in antiquities as an occupation should obtain permission from the State. Furthermore taking the antiquities out of the country shall require permission from the State. The registered objects in the list for National Heritage if attempted to be taken out of the country without the permission of the State, shall be confiscated in the interest of the State "
"Article 17 Anyone who accidentally finds a movable property even thought it has been discovered in his/her own property, shall be obliged to immediately inform the Ministry of Education through its nearest representative of the Department for Education or through the Finance Officers if there is no Department for Education. After the objects has (sic) been examined by the Department for Antiquities half of the items or half of the commercial price thereof as evaluated by qualified experts shall be transferred to the finder, and the State shall have the authority to possess or transfer the other half to the finder".
"Article 18 The state possesses the exclusive rights to land excavation for the purpose of obtaining antiquities.
Article 25 Excavation in private lands shall require the owner's consent as well as the permission of the State ..
..
Article 31 The manner of sharing the antiquities discovered in a place during a season of commercial or scientific excavation, between the excavator and the State shall be as follows: The first choice of the objects discovered, up to ten items, shall be that of the State, and then the State shall equally share the remainder with the licence holder. Immovable antiquities shall pertain to the State and not be divided. In case the discovered objects shall not exceed ten items, the State, by virtue of the authority invested in it, shall possess them all and refund expenses that the excavator sustained. The holder of the excavator licence may possess his/her share of the antiquities discovered, provided that he/she had been refunded the rental value due to the owner
Article 36 Any person who takes measure violating the provisions of Article 10 from the law or Article 17 herein, or embark on excavation without securing proper permission at (sic) export antiquities illegally, shall be liable to a fine twenty to Two thousand Tomans, and the discovered objects shall be confiscated by the State ..
Article 41 - Provides that certain classes of antiquities are authorised to be traded, that ie can be bought and sold. (It is common ground that this Article is now entirely superseded).
Article 48 - In case the examination by Department for Antiquites proved that some of the objects had been illegally obtained, those objects shall be seized and confiscated by the State. The owners and exporters may be prosecuted according to the Antiquities Act
Article 50 In case the State recognises that the registered objects in the List for National Heritage, for which export permission has been requested, are beneficial for developing national collections, it shall have the authority to purchase the objects in question at the price declared by the owner. Should the owner refrain from selling the objects, export permits shall not be granted.
Article 51 The Antiquities intended to be taken out of the country without obtaining proper permission shall be confiscated".
"Legal Bill Regarding Prevention of Unauthorised Excavations and Diggings intended to obtain antiquities and historical relics which according to international criteria, have been made or have come into being one hundred or more years ago".
The bill consists of a single Article which, since it forms a vital part of Iran's case, I will quote almost in full:
"Considering the necessity of protection of relics belonging to Islamic and cultural heritage, and the need for protection and guarding these heritages from the point of view of sociology and scientific, cultural and historical research and considering the need for prevention of plundering these relics and their export abroad, which are prohibited by national and international rules, the following Single Article is approved.
1 - Undertaking any excavation and digging intended to obtain antiquities and historical relics is absolutely forbidden and the offender shall be sentenced to six months to three years correctional imprisonment and seizure [in Farsi "zabt"] of the discovered items and excavation equipment in favour of the public treasury. If the excavation takes place in historical places that have been registered in the National Heritage :List, the offender shall be sentenced to the maximum punishment provided (in this Section).
2 - Where the objects named in this discovered accidentally, the discoverer is duty bound to submit them to the nearest office of Culture and Higher Education as soon as possible. In this case, a committee consisting of the Religious Judge, local Public-Prosecutor and the director of the office of Culture and Higher Education, or their representatives, will be formed with a specialised expert attending and who will examine the case and decide as follows:
A Where the items are discovered in a private property, in the case of precious metals and jewels, they will be weighed and a sum equal to twice the market value of the raw material thereof will be paid to the discoverer. IN the case of other objects, half of the estimated price will be paid to him.
B Where the items are discovered in non-private property, a sum equal to half of the discovery reward, provided for in Section A, will be paid to the discoverer
3 Antiquities means articles that according to international criteria have been made or produced 100 , or more, years ago. In the case of objects whose antiquity is less than a hundred years, the discovered objects will belong to the discoverer after he has paid a fifth of their evaluated price to the public treasury.
4 - Persons who offer the discovered objects for sale or purchase in violation of the provisions of this Act will be sentenced provided for in Section 1".
"Article 45 [Public Wealth]
Public wealth and property such as uncultivated and abandoned land, mineral deposits, seas, lakes, rivers and other public waterways, mountains, valleys, forests, marshlands, natural forests, unenclosed pastures, legacies without heirs, property of undetermined ownership and public property recovered from usurpers shall be at the disposal of the Islamic Government for it to utilise in accordance with the public interest. Law will specify detailed procedures for the utilisation of each of the foregoing items". .
Article 47 [Private Property]
Private ownership, legitimately acquired, is to be respected. The relevant criteria are determined by law.
Article 83 [Property of National Heritage]
Government buildings and properties forming part of the national heritage cannot be transferred except with the approval of the Islamic Consultative Assembly; that, too, is not applicable in the case of irreplaceable treasures".
"Article 559 any person found guilty of stealing equipments and objects, as well as the materials and pieces of cultural- historical monuments from museums, exhibits, historical and religious places or any other places which are under the protection and control of the state; or trades in such objects or conceals them knowing that they are stolen - shall be obliged to return them and condemned to confinement of one to five years if not subject to punishment for theft (as ordained by Islamic religion). .
Article 561 any attempt to take historical-cultural items out of the country, even if it would not be actually exported, shall be considered as illegal export. The violator shall be condemned to restitute the items, imprisoned from one to three years, and fined as (sic) twice as the value of the items exported. .
Article 562 any digging or excavation intended to obtain historical-cultural properties is forbidden. The violator shall be condemned to undergo a confinement of six months to three years; the discovered objects shall be confiscated in the interests of the Iranian Cultural Heritage Organisation and the equipments of the excavation shall be confiscated by the state
Note 1.Whoever obtains the historical/cultural properties, that are the subject of this Article, by chance and does not take (the necessary) steps to deliver the same, according to the regulations of the State Cultural Heritage Organisation, will be sentenced to the seizure of the discovered (found) properties.
".
The Rival Contentions as to the Ownership of the Antiquities
i) The clear purpose of the legislation is for property in antiquities which have been dug up to vest in the state and no one else. That purpose is clear in particular in the 1979 Legal Bill but also in Articles 569 and 562 of the Penal Code and/or the Punishment Law.
ii) The exclusive right to dig for antiquities is vested in the state and in no one else: see the 1930 Act; the Executive Regulations and the 1979 Legal Bill.
iii) It is not possible to obtain title by unlawful activity nor by unlawful possession: see paragraph 35 of the expert report of Professor Taleghany and Article 36 of the Civil Code.
iv) When an antiquity is found and dug up, neither the finder nor the owner of the land acquires title to it. Nor does either have any right to keep such an antiquity. The obligation is to deliver the antiquity to the state: see the Legal Bill of 1979.
v) There is no principle of "finders keepers" with regard to antiquities; an excavator who takes possession of one of the antiquities cannot conceivably become its owner.
vi) The finder of an antiquity obtains no title to it. At best he may receive a reward when he delivers the antiquity to the relevant ministry: see again the 1979 Legal Bill at numbered sub-paragraph 2 and contrast sub-paragraph 3.
vii) The owner of the land where the antiquity is found has no right of ownership in it. The only person who receives payment is the founder or discoverer of the antiquity.
viii) Even in a case when the excavation is authorised or licensed, the owner of the land obtains no payment or monetary reward; still less does he acquire title. All the owner is entitled to is the rental value of the land: see articles 25 and 31 of the Executive Regulations.
ix) All trading in antiquities has been unlawful since 1979.
x) The only person to whom a finder of antiquity may transfer it is the state. The obligation on the finder is to deliver the antiquity to the state as soon as possible: 1979 legal bill sub-paragraph 2.
xi) Any finder of an antiquity who keeps it or transfers it to another is acting unlawfully and in breach of the ownership right vested in the state. In other words such a finder would in English terms have converted the antiquity and in Iranian terms would have usurped it: see Article 308 of the civil code.
xii) The transferee from the finder acquires no title in the antiquity. The principle nemo dat quod non habet is recognised by Iranian law: see Article 317 of the Civil Code.
xiii) The seizure provisions which are to be found in both Iran's criminal and civil laws are the mechanism by which the state obtains possession of antiquities and not, asBarakat
contends, recognition that until the time of seizure the finder is the owner.
Analysis of the Provisions of Iranian Law as to the ownership of the antiquities
'Following the Islamic Revolution and the collapse of law and order during the early days of the Islamic Republic, a large number of historical sites were looted and opportunist excavation of the national heritage sites became widespread. This was partially encouraged by the attitude of certain members of the ruling clergy who considered that certain items of historical value were un-Islamic and suggested that these should be destroyed.
In order to combat this situation, the Government introduced the 1979 Act for amongst others "prevention of plundering of these relics"'.
'The provisions reflect the fact that such antiquities belong to the state'.
For the reasons already explained, I have been unable to find any provision prior to the 1979 Bill which confers ownership of antiquities on the state. To the extent that Professor Taleghany is asserting that the 1979 Legal Bill does so, I cannot agree with him. As Mr Sabi points out, the Bill has on its face the limited objective of preventing the plundering of relics. It is, as Mr Sabi says, principally at least, a criminal statute. There is no express vesting of title to antiquities in Iran nor any declaration that all antiquities are vested in the state. I find it difficult to see how the provisions "reflect the fact" of state ownership. As Mr Sabi rightly says, the draftsman could so easily have provided for state ownership of all antiquities if such had been his intention. It seems to me that, given the historical background to the Bill's enactment, its purpose was to criminalise the widespread pillaging of antiquities which was then taking place and not to make provision for state ownership of antiquities.
"these objects are capable of being stolen because they belong to the state".
But objects can be stolen from persons other than their owner and objects can be and often are loaned to museums by their owners.
Conclusion as to the ownership of the antiquities under Iranian Law
Iran's alternative claim based upon its right to immediate possession
The need to establish a proprietary right
"I take [the judgment below] to mean that the contractual right which the plaintiff had vis-α-vis Patterson to go and collect these goods from Patterson's agent was a right of a sufficient character to enable the plaintiff to bring an action in detinue against the agent of the owner of the property in these goods. But, with all respect to the County Court Judge, I am unable to accept that as a good proposition of law. Certain classes of persons, as for example bailees have, no doubt, a special right to sustain actions in trover and detinue but the general rule is, I think, correctly stated in the text of Halsbury's Laws of England 2nd Ed Vol 33 at p62, para 98: 'in order to maintain an action of trover or detinue, a person must have the right of possession and a right of property in the goods at the time of the conversion or detention; and he cannot sue if he has parted with the property in the goods at the time of the alleged conversion, or if at the time of the alleged conversion his title to the goods has been divested by a disposition which is valid under the Factors Act 1989'.
'it is further to be noted that the action of detinue was essentially a proprietary action implying property in the plaintiff in the goods claimed', and then a reference is made to Viner's Abridgement vol 8 p23 and Holdsworth, History of English Law vol 7, pp 438 and 439. ' It was, and still is, of the essence of an action of detinue that the plaintiff maintains and asserts his property in the goods claimed .
I think that the rights of the plaintiff as regards these goods were not such as entitled him to bring an action in detinue against the defendant, in whose possession they were, as agent, as the time, of the person in whom the property in the goods was then vested'.
" so a contractual right is not sufficient.
In my view, however, there was here something more than a contractual right. Clause 11(e) of the [Factoring] agreement provided both that the company was to hold any debt paid direct to the company in trust for the plaintiffs and immediately after receipt of a cheque, in the case of payment by cheque, to hand over that cheque to the plaintiffs. Taking together the trust which was thereby set up and the obligation immediately on receipt to hand over the cheque to the plaintiffs, I am satisfied that the plaintiffs had here a sufficient proprietary right to sue in conversion".
Bridge LJ agreed with Sir David Cairns. Buckley LJ agreed in the result but he said at 359g:
"It is manifest on the terms of clause 11(e) of the agreement that the intention of the parties was that the cheque itself, if payment was by cheque, should be handed on, endorsed if necessary to the plaintiffs, and that confers upon the plaintiffs, as it seems to me an immediate right to possession if any such cheque quite sufficient to support a cause of action in conversion against anyone who wrongfully deals with the cheque in any other matter.
I think that there is a contractual right here for the plaintiffs to demand immediate delivery of the cheque to them, and that that is a sufficient right to possession to give them a status to sue in conversion".
Is Iran's right to possession immediate?
The second preliminary issue: non-justiciability
Are the relevant Iranian laws penal?
"all breaches of public law punishable by pecuniary mulct or otherwise at the instance of the state government or someone representing the public".
The court quoted with approval a passage from a decision of the United States Supreme Court in Wisconsin v Pelican Insurance Co, 127 US 265, 290 (1888):
"The rule that the courts of no country execute the penal laws of another applies, not only to prosecutions and sentences for crimes and misdemeanours but to all suits in favour of the state for the recovery of pecuniary penalties for any violation of statutes for the protection of its revenue or other municipal laws and all judgments for such penalties".
" A penal law is a law which punishes or prevents an offence. To come within this principle the law does not have to be part of the criminal code of the foreign country. Thus a law intended to protect the historic heritage of New Zealand by forfeiting historic articles illegally exported was held to be penal "
That is a reference to a finding made by two members of the Court of Appeal in Ortiz. In that case Ackner LJ at 34a gave as his reason for finding that the New Zealand statute was penal the fact that:
"It concerns a public right the preservation of historic articles within New Zealand which right the State seeks to vindicate. The vindication is not sought by the acquisition of the article in exchange for proper compensation. The vindication is sought through confiscation "
O'Connor LJ agreed with Ackner LJ at 25e.
"One explanation of the rule thus illustrated may be thought to be that enforcement of a claim for taxes is but an extension of the Sovereign power which imposed the taxes and that an assertion of Sovereign authority by one State within the territory of another, as distinct from a patrimonial claim by a foreign sovereign, is (treaty or convention apart) contrary to all concept of independent sovereignty ".
Are the relevant Iranian laws public?
"41 The importance of the speech of Lord Keith in the Government of India and the judgment of Lord Denning in Ortiz case is that they both sought to explain the rationale for the well-established rule that the courts will not enforce the penal and revenue laws of another country. In short, it is that the courts will not enforce or otherwise lend their aid to the assertion of sovereign authority by one State in the territory of another. The assertion of such authority may take different forms. Claims to enforce penal or revenue laws are good examples of acts done by a sovereign by virtue of his sovereign authority ("jure imperii"). In each case it is necessary to see whether the relevant Act is of a sovereign character. Penal and revenue laws are assumed to be of a sovereign character."
"42 As Lord Denning made clear in Ortiz, his judgment was influenced by the article by Dr Mann to which we have referred in paragraph 26 above. At page 34, Dr Mann said:
"Where the foreign State pursues a right that by its nature could equally well belong to an individual, no question of a prerogative claim arises and State's access to the courts is unrestricted. Thus a State whose property is in the defendant's possession can recover it by an action in detenue. A State which has a contractual claim against the defendant is at liberty to recover the money due to it. If a State's ship has been damaged in a collision, an action for damages undoubtedly lies. On the other hand, a foreign State cannot enforce in England such rights as are founded upon its peculiar powers of prerogative. Claims for the payment of penalties, for the recovery of customs duties or the satisfaction of tax liabilities are, of course, the most firmly established examples of this principle".
We agree.
50. Having heard detailed argument, we are unable to accept Sir Sydney's submission that the views expressed in the Privy Council in the paragraphs just quoted are wrong. The critical question is whether in bringing a claim, a claimant is doing an act which is of a sovereign character or which is done by virtue of sovereign authority; and whether the claim involves the exercise or assertion of a sovereign right. If so, then the court will not determine or enforce the claim. On the other hand, if in bringing the claim the claimant is not doing an act which is of a sovereign character or by virtue of sovereign authority and the claim does not involved the exercise or assertion of a sovereign right and the claim does not seek to vindicate a sovereign act or acts, then the court will both determine and enforce it. As we see it, that was the broad distinction of principle which the court was seeking to draw in the Emperor of Austria case. In deciding how to characterise a claim, the court must of course examine its substance, not be mislead by appearances: see, for example, Huntington v Attrill ".