Conflict of laws – European Union – Real property

Meletios Apostolides (appellant) v (1) David Charles Orams (2) Linda Elizabeth Orams (respondents) & British Residents’ Society (intervener): CA (Civ Div) (Lords Justice Pill, Lloyd, Sir Paul Kennedy): 19 January 2010

The appellant (M) appealed against a decision ((2006) EWHC 2226 (QB), (2007) 1 WLR 241) setting aside an order that two judgments of the Nicosia District Court in the Republic of Cyprus be registered and declared enforceable pursuant to regulation 44/2001 and the case returned to the Court of Appeal to decide the appeal following a reference to the European Court of Justice.

Cyprus was invaded by Turkish forces in 1974 and the Turkish Republic of Northern Cyprus was established in the northern part of the island. M owned land in that part of Cyprus. The respondents (O) had purchased part of the land from a Turkish Cypriot, who was the registered owner under the law of the Turkish Republic of Northern Cyprus, and built a villa on it. M issued proceedings in the Nicosia court for an order requiring O to demolish the villa and deliver free possession of the property to M. A default judgment was entered and O’s application to set aside that judgment was dismissed.

The master in the High Court made an order for those judgments to be registered and enforceable in the UK pursuant to regulation 44/2001. The judge set aside that order on the basis that the regulation was of no effect in relation to matters that related to the area controlled by the Turkish Republic of Northern Cyprus. On appeal the Court of Appeal referred that issue to the European Court of Justice which ruled that the regulation did apply to a judgment given by a court in the Republic of Cyprus in relation to land in the north of the island over which the Republic did not exercise effective control.

O submitted that: (1) the judgments should be denied enforcement under article 34(1) of the regulation as contrary to public policy since enforcement would tend to jeopardize the efforts towards restoring civil peace and reconciliation on the island, alternatively that question should be referred to the ECJ; (2) the judgment of the ECJ was affected by the apparent bias of Judge Skouris, president of the court, by reason of his contacts with representatives of the Republic of Cyprus, and he should have recused himself, alternatively the issues of apparent bias and recusal should be referred to the ECJ.

Held: (1) It was not manifestly contrary to public policy in the UK to enforce the obligation under EU law to register judgments of courts in Cyprus. International support for attempts to achieve a settlement in Cyprus did not convert into an obligation on a UK court to assess whether a decision of the court did or did not support the peace process. That was not a function which the court could or should perform, but even if an assessment were to be made, it was far from clear whether enforcement of the judgments of a Cypriot court did or did not encourage the peace process.

The importance of the peace process in Cyprus would need to be balanced against other international obligations which required the UK to respect the sovereignty, independence and territorial integrity of Cyprus. Thus if domestic courts were forced to make a judgment on what international public policy required or where the political balance of interest rested, those obligations could not be ignored and pointed towards enforcing judgments of the courts of Cyprus. There was no fundamental principle within the legal order of the UK which the recognition and enforcement of the judgments in question would be liable to infringe, Bamberski v Krombach (C-7/98) [2001] QB 709 ECJ applied. If a further question were to be referred to the ECJ, it was inconceivable that the court would direct the UK as to what was manifestly contrary to its public policy. Nor was there a real possibility that the ECJ would identify and define, in the present context and for the purposes of article 34(1), a principle or principles of international public policy which national courts would be obliged to consider when deciding whether to recognise judgments of another member state.

(2) The contacts of the president of the ECJ with Cyprus and the award of an honour by the Cypriot government did not give rise to an appearance of bias. The instant case was to be decided, and was decided, by a Grand Chamber according to legal principles. The perception of the reasonable and informed observer would be that there was no real possibility that the president would be influenced by the honour he received or by his other contacts. The judgment of the ECJ was in no way tarnished by those contacts, considered either individually or cumulatively. The judgment could be applied and no further reference was appropriate. Therefore the master’s order for registration of the Cypriot judgments was reinstated.

Appeal allowed.

Thomas Beazley QC, Vaughan Lowe QC, Colin West (instructed by Holman, Fenwick & Willan) for the appellant; Cherie Booth QC, Nicholas Green QC, Angela Ward (instructed by Herbert Smith) for the respondents.