Friday January 28, 2022

Conflict of laws

October 23, 2019

It is a fundamental principle of private international law that, in order to avoid ‘conflict of laws’ and to respect the ‘comity of nations’, only courts of law in the country in which immovable properties are situated have exclusive jurisdiction, and only the laws of that country will apply. Courts cannot assume jurisdiction over foreign immovable properties.

This principle was also followed in the case of Hotel Metropole. In the Hotel Metropole case, the Honourable Sindh High Court did not enforce a foreign decree attaching the hotel, issued by J Sir Jan Peter Singer of the High Court of England and Wales, in a suit under the UK Matrimonial Laws, filed by Meher Minwala, the divorced wife of Mr Happy Minwala. As a result the decree was not enforced in Pakistan as it did not apply the laws of Pakistan — ie, the Parsi Marriage and Divorce Act 1936 — and instead invoked the laws of England.

The question often arises which is the proper law to be applied so as to avoid conflicts of laws between nations of different countries. The laws of England do not recognize the concept of ‘benami transactions’. The concept of benami or ostensible owner was

first applied by the Privy Council to transactions relating to transfer or ownership of immovable properties in British India.

In the year 2017, the parliament of Pakistan passed the Benami Transaction (Prohibition) Act 2017. The Benami Act contains various penal consequences including confiscation of benami property. This Act applies only to the territories of Pakistan and does not apply to immovable properties situated in England. Subsection (2) of Section (1) of the Act expressly

states “it shall extend to the whole of Pakistan”.

The Indian Supreme Court, in the case of Ct A Ct Nachiappa Chettiar v Ct A Ct Subramania Chettiar, reported in AIR 1960 SC 307, held that the courts in India have no jurisdiction to determine the questions of title in respect of immovable properties situated in foreign countries or to direct partition thereof.

The fundamental principle in the case of immovable properties, stated in ‘Conflict of Laws’, authored by eminent Jurist Dicey, is as follows: “The courts of a foreign country have no jurisdiction to adjudicate upon the title or the right to the possession of any immoveable property not situated in such country”.

The laws of England and Wales do not include or recognize the doctrine of ‘benami or ostensible ownership’ if the land or building is situated in the UK. The registered owner alone is the owner and no one else.

In keeping with the fundamental doctrine of ‘Comity of Nation’ and to avoid ‘Conflict of Laws’, the concept of ostensible owner or benami ought not to be extended to an immovable property situated in England. Indeed any person declaring a property registered in the UK in the name of another person as his own could be prosecuted in England for making a false claim to title of the property.

In order to avoid ‘conflict of laws’ between the courts of law of different countries, in the case of immovable properties, the proper law is the law of the country where the property is situated. Thus, if the immovable property is situated in England the concept of benami or ostensible is not applicable. This is also known as the doctrine of ‘comity of nations’.

The laws of Pakistan end on the shores of the Arabian Sea, extending from Gwadar to Keti Bunder.

The writer is an author, and a senior advocate of the Supreme Court of Pakistan.