HAILE SELASSIE vs. CABLE AND WIRELESS, LTD.

England, High Court (Chancery Division). (Bennett, J.) July 27, 1938.

Court of Appeal. (Sir Wilfrid Greene, M.R., Scott and Clauson, LJJ) December 6,
1938.

PRINCIPLE: The limitation of recognition to recognition de facto deprives the de

FACTS:
Haile Selassie v. Cable & Wireless, Ltd, raises questions relating both to
the impleading of a foreign sovereign and to the legal status of sovereigns de
facto and de jure. In this case the exiled Emperor of Ethiopia, who at that time
was still recognized by the British Government as de jure sovereign of Ethiopia,
claimed from the defendant company a balance due under a concessionary
contract entered into in 1934 with a department of the Ethiopian government
representing the plaintiff in his capacity of sovereign of Ethiopia. The defendant
company admitted the sum due from them, but produced letters from the Italian
Ambassador in London in which the Italian government claimed the money and
also refused to have its claim determined in the English Courts. The defendants
argued that the King of Italy, by virtue of his recognition as de facto sovereign of
Ethiopia, had acquired the right to the money, and that therefore payment to
Haile Selassie would not discharge the debt. Bennett J. declined to express an
opinion on the question of law thus raised. He held that the action must be
stayed because "the right of the plaintiff to recover judgment cannot be
determined without determining whether the claim put forward by or on behalf
of His Majesty the King of Italy is well founded."

The first proposition did not apply to this case, as the King of Italy was not a party
to the proceedings, and an action in contract was in personam, not in rem. The
second proposition was also inapplicable, as there was no "proved or admitted
proprietary or possessory right" belonging to the King of Italy at stake. As Greene
M.R. expressed it, "where property which is not proved or admitted to belong to
or to be in the possession of a foreign sovereign or his agent is in the possession
of a third party, and the plaintiff claims it from that third party, and the issue in
the action is whether the property belongs to the plaintiff or the foreign
sovereign, the very question to be decided is one which requires to be answered
in favor of the sovereign's title before it can be asserted that title is being
questioned." In other words a foreign sovereign must establish his title to a
choice in action before he can claim immunity. The action was therefore
remitted to Bennett J. for a decision on the merits.

BENNET,J. RULING:
Bennett J. held, therefore, that there was no English authority applicable to these
facts. But in his view the title to sue for this debt had been vested in the plaintiff
as sovereign monarch of Ethiopia, and the occupation and annexation of
Ethiopia by the Italians should not, on principle, have the effect of divesting him
of the title to sue.
The defendant appealed against this decision, but before the hearing in the
Court of Appeal the British Government granted recognition to the King of Italy
as de jure sovereign of Ethiopia.

ISSUE: "Does the fact that the Italian Government has been and is recognized by
the British Government as a de facto government of Ethiopia vest in the Italian
Government the right to sue for and obtain judgment in an English Court for a
debt formerly due to and recoverable by the plaintiff as the sovereign authority
of Ethiopia, the debt being due to the plaintiff as Emperor of Ethiopia, and the
British Government recognizing the plaintiff as the de jure Emperor of Ethiopia?"

RULING OF CA:
The Court of Appeal held that in the circumstances the right to sue had
passed from the plaintiff and become vested in the King of Italy, and that for the
purpose of succession to property. Such recognition dated back to the time
when the British Government first recognized that the new sovereign had
acquired a de facto title. The decision of Bennett J. that this succession to
property in England does not take place when the old sovereign is still
recognized de jure and the new sovereign as only a de facto government of the
territory, was neither affirmed nor impugned by the Court of Appeal.

It is submitted, however, that such a decision is out of tune both with