Contracts - human rights agreements - immunity from suit - international organisations

Entico Corporation Ltd (claimant) v United Nations Educational Scientific & Cultural Association (defendant) & Secretary of State for Foreign & Commonwealth Affairs (intervener): QBD (Comm) (Mr Justice Tomlinson): 18 March 2008

The applicant company (E) applied for judgment in default of acknowledgement of service in respect of its claim for damages against the respondent international organisation (U).



E claimed that it had concluded a contract with U pursuant to which E was to produce a calendar for U. The alleged contract provided for disputes to be settled by arbitration under UNCITRAL rules. E alleged that, in due course, U failed and refused to perform the contract in consequence of which E had suffered loss and damage in the shape of costs and wasted expenditure. E quantified its loss as £86,484.



E issued proceedings, claiming that amount from U. U enjoyed immunity from legal process pursuant to the Specialized Agencies of the United Nations (Immunities and Privileges) Order 1974, implementing the UK's international obligations under the Convention on the Privileges and Immunities of the Specialised Agencies 1947.



E asserted that U's immunity violated E's rights under article 6(1) the European Convention on Human Rights to fair and public judicial processes.



E submitted that the court, in compliance with the interpretative obligation imposed by section 3 of the Human Rights Act 1998, should read the 1974 order in relation to U as containing a proviso to the effect that U should have immunity from suit and legal process, provided the requirement of the 1947 convention in relation to making appropriate provision for settlement of disputes was satisfied, and should go on to declare that U had failed to satisfy that requirement in the present case and was not immune from suit and legal process in respect of E's claim.



Held: (1) There was nothing in the 1947 convention to make enjoyment of the privileges and immunities conferred by it dependent on compliance with the requirement for a specialised agency to make provision for appropriate modes of settlement of disputes arising out of contracts. The convention itself offered no criteria pursuant to which the appropriateness of a mode of settlement was to be judged, nor did it say that the mode of settlement for which provision was made had to be effective. It would be wholly inimical to the international scheme envisaged if individual states arrogated to themselves the power to determine whether the provision made by each specialised agency for the settlement of disputes was adequate, whether considered generally or by reference to the facts of a particular case.



(2) The 1947 convention had to be interpreted in accordance with the principles codified in the Vienna Convention on the Law of Treaties 1969. The 1947 convention plainly required the parties to recognise and to give effect to a broad jurisdictional immunity possessed by each specialised agency. There was no room for reading down the provisions of the 1947 convention in order to take account of the provisions of the subsequent European Convention on Human Rights, a treaty which was binding upon only a minority of the parties to the 1947 convention.



(3) On the assumption that article 6 of the European Convention on Human Rights was engaged, the grant of immunity to U pursued a legitimate aim. Compliance with obligations owed in international law was of itself pursuit of a legitimate aim. Insofar as the 1974 order reflected generally recognised rules of public international law on organisational immunity, it could not, in principle, be regarded as imposing a disproportionate restriction on the right of access to court as embodied in article 6(1). It was not relevant to take into account the availability of an alternative forum, Waite v Germany (26083/94) [2000] 30 EHRR 261 ECHR distinguished. If that was wrong, there was in the present case an available mode of dispute resolution, namely arbitration under UNCITRAL rules, which was the remedy which E itself put forward for acceptance in the alleged contract.



Application refused.



Shaheed Fatima (instructed by Gaby Hardwicke) for the claimant; no appearance or representation for the defendant; Christopher Greenwood QC, Jemima Stratford (instructed by the Treasury Solicitor) for the intervener.