PVT law 17-20 Flashcards
(23 cards)
Jurisdiction in case of immovable property:
the Mocambique Rule
🔹 What is the Mocambique Rule?
- Established by: British South Africa Co. v Companhia de Mocambique (House of Lords).
- Core Principle:
- English courts cannot decide cases involving ownership or possession of immovable property (land) located in another country.
🔹 Key Points:
- Even if both parties live in or are domiciled in England, the English courts lack jurisdiction over disputes involving foreign land.
- The rule applies broadly – not just to ownership disputes, but also to any claims involving foreign land, as held in Hesperides Hotels v Muftizade.
- The rule is based on practical reasons:
- Only the courts in the country where the land is located (situs) can enforce decisions and make effective orders about that land.
🔹 Crux:
- If a legal dispute involves immovable property located abroad, it must be resolved in the courts of that country, not in English courts, no matter where the parties are from.
Exceptions to the Mocambique rule
First Exception : Action founded on personal obligation. The doctrine of Penn v. Baltimore
- Second exception: Questions affecting foreign land incidentally arising in an English action
- Third exception: Admiralty jurisdiction in trespass
Penn v. Baltimore
🔹 Core Idea:
- English courts cannot directly decide rights over foreign land (jus in rem),
but they can enforce personal obligations (in personam) against a person under their jurisdiction—even if that affects foreign land indirectly.
🔹 Doctrine from Penn v. Baltimore:
- If a person’s conscience is bound by a personal obligation (e.g., contract), the court can order them to act, even if that indirectly affects land abroad.
- The court’s jurisdiction is personal, not territorial—it acts on the person, not the land.
🔹 Requirements to Apply This Doctrine:
- The defendant must be personally subject to the court’s jurisdiction (i.e., present or domiciled in England).
- There must be a clear personal obligation arising from:
- A contract involving foreign land,
- Fraud or unconscionable conduct, or
- A fiduciary relationship.
### 🔹 Facts of Penn v. Baltimore:
- Penn (owner of Pennsylvania) and Lord Baltimore (owner of Maryland) had a contract in England to settle boundary disputes.
- Lord Baltimore objected, arguing that English courts had no power over American land.
- Court agreed it couldn’t pass a decree in rem, but still ordered specific performance of the contract because:
- The agreement was made in England, and
- Baltimore was subject to the court’s personal jurisdiction.
🔹 Crux:
Courts cannot control foreign land, but they can compel a person under their jurisdiction to act in a way that affects foreign property—if there’s a personal equity or obligation involved.
Singh v. Singh
Two brothers residing in Australia were involved in a dispute involving an immovable
property situated in Malaysia.
One brother X was supposed to hold this property on trust for the other, but instead he transferred it to his wife and daughter.
Brother Y for whom property was held on trust brought proceedings in western
Australia against X, his wife and daughter to prevent further alienation of the property
and also transferring the property back to him.
The majority decision** held that the mocambique rule will not apply, rather the exception will apply as the jurisdiction is not over the property but over the persons of the
defendants**.
As per recent jurisprudence, it can be said that the mocambique rule has become the
exception and the exceptions have become the rule.
Mahadev v.
Ramchandra 1922 Bombay HC
it was held that even if the proviso to S/16 is considered to be
not applicable to cases where property is situated outside India, the English rule with respect to jurisdiction in personam applies to India if the relief can be obtained through personal
obedience of the defendant. This case involved a suit for mesne profit over property in foreign
country against the defendant who was residing within the jurisdiction of the Bombay HC.
Fraud and other unconscionable conduct: Cranstown v Johnson
🔹 Facts:
- Plaintiff owned land in St. Christopher (Caribbean island).
- Defendant was a creditor under an arbitration award; plaintiff couldn’t pay on time due to being abroad.
- Defendant used local St. Christopher law to:
- Serve summons by leaving it at the property and nailing it to the courthouse door.
- Obtain a default decree without actual notice to the plaintiff.
- Buy the land at a court sale for much less than market value.
🔹 Legal Issue:
- Plaintiff sued in England for recovery of the plantation, arguing unfair and exploitative conduct by the defendant.
- Defendant argued his actions were legally valid under local (St. Christopher) law.
🔹 Court’s Decision:
- English court intervened, ordering that:
- On repayment of the debt plus interest, the defendant must reconvey the land.
- Although the procedure followed local law, the purpose was exploitative:
- Defendant used the process to get land cheaply, not just to recover a debt.
- This was deemed unconscionable conduct.
🔹 Legal Principle:
- Court applied its in personam jurisdiction (similar to Penn v. Baltimore doctrine).
- When the defendant is subject to English court jurisdiction, and:
- Acts unconscionably (even if legally correct elsewhere),
- The English court can intervene, acting on the defendant’s conscience, not directly on foreign land.
🔹 Crux:
Even if a property transaction is technically valid under foreign law, the English court can compel restitution if the transaction was fundamentally unjust and the defendant is personally within its jurisdiction.
Limitations to the doctrine of Penn v
Baltimore
🔹 General Principle (Recap):
- Under Penn v. Baltimore, English courts can issue personal decrees affecting foreign land, if the defendant is under their jurisdiction and bound by a personal obligation.
🔹 Limitations to This Doctrine:
1. Compliance Must Be Possible Under Lex Situs (Law of the Land):
- The court’s direction must be capable of being performed under the law of the country where the land is located.
- If lex situs (local law) prohibits the act ordered by the English court (e.g., sale, transfer, or reconveyance), then:
- The order cannot be enforced, and
- The doctrine does not apply.
2. Requirement of Personal Equity / Privity of Obligation:
- There must be a direct personal obligation between the plaintiff and defendant.
- This privity must arise from a transaction or legal relationship between them.
- No jurisdiction can be exercised against a third party (e.g., someone who bought land later), even if they benefited from a breach of the original obligation.
🔹 Illustrative Example:
- If A agrees to sell foreign land to B, A has a personal obligation to B enforceable in England.
- But if A breaches the contract and sells to X (a third party):
- B cannot sue X in England under this doctrine.
- There is no personal equity between B and X.
🔹 Case Example: Norris v Chambers:
- Simon (landowner in Prussia) agreed to sell land to Sadler, accepted a deposit.
- Simon breached the agreement and sold the land to Chambers, who had notice of the original deal.
- Sadler’s representative (Norris) sued Chambers in England seeking a lien on the land.
- The English court dismissed the case:
- No direct privity or personal obligation existed between Sadler and Chambers.
- Hence, the doctrine of Penn v. Baltimore was inapplicable.
🔹 Crux:
The Penn v. Baltimore doctrine applies only if:
1. The action ordered is permissible under local land law (lex situs), and
2. There is a direct, personal legal relationship (privity) between plaintiff and defendant.
Deschamps v. Miller
A and B, domiciled in France got married in France
The marriage contract provided for community interests in the after acquired properties. Under** French law, the wife would be entitled to a share in the properties of the husband and vice versa.
* A, the husband went to India, acquired landed properties in Madras. He married
another woman Q, bigamously in Madras and settled the lands he acquired in
Madras in trust for Q and her children.
* After the death of A and B, their only son, brought an action in England claiming one half share in the Madras lands against the trustees of the Madras settlement.
The contention was that according to French law, B, the French wife was entitled
to half of the properties in Madras and the settlement effected in Madras was
invalid. The claim was dismissed holding that the English court had no
jurisdiction. There was no personal equity running between the plaintiff** and the
defendants, the trustees of the Madras settlement
Second and third exception to the Mocambique Rule
Here is a simplified bullet-point summary of the exceptions to the Mocambique Rule and the choice of law in relation to foreign immovables, focusing on the key technical points:
🔹 Second Exception to the Mocambique Rule:
#### ➤ Foreign land issues incidental to English proceedings
- If a case involves administration of a trust or estate that includes:
- Movable and immovable property in England, and
- Foreign immovable property,
- The English court has jurisdiction to deal with foreign land-related questions incidentally, for the purpose of full administration.
🏷️ Case: In Re Duke of Wellington
- The Duke left wills covering lands in England and Spain.
- The English court decided issues related to the Spanish property as they were incidental to the primary English will and trust proceedings.
🔹 Third Exception: Admiralty Jurisdiction in Trespass
#### ➤ Trespass to foreign land via maritime claims
- General rule: English courts don’t entertain actions about trespass to foreign land.
- Exception: Applies where the court exercises admiralty (maritime) jurisdiction.
⚓ Case: The Tolten
- Plaintiff owned a wharf in Lagos, Nigeria.
- Defendant’s ship negligently damaged the wharf.
- Plaintiff had a maritime lien on the ship, enforceable by action in rem in England.
- The English court accepted jurisdiction, ruling that the Mocambique Rule doesn’t apply in admiralty matters.
🔹 Choice of Law – Lex Situs (Law of the Place Where Property is Located)
⚖️ Case: Nelson v Bridgeport
- All legal matters relating to real estate (immovable property) are governed by the law of the place where the land is situated (lex situs).
➤ Lex Situs governs:
1. Capacity to acquire immovables
2. Capacity to transfer them (by sale, mortgage, gift, etc.)
3. Formal validity of the transfer
4. Essential validity (e.g., consent, legality)
5. Succession rules – both testate (with will) and intestate (without will)
🔹 Crux:
- The Mocambique Rule bars direct adjudication over foreign land, but:
- Incidental issues in estate/trust cases and
- Admiralty trespass cases are recognized exceptions.
- Lex situs is the decisive law for any legal issue concerning foreign immovable property.
mocambique rule wrap up
🔹 Mocambique Rule (General Rule):
- English courts have no jurisdiction to decide disputes involving title or possession of foreign immovable property, even if both parties are domiciled or resident in England.
✅ Exceptions to the Mocambique Rule:
1. In Personam Jurisdiction (Penn v. Baltimore Doctrine):
- English courts can issue personal orders against a defendant under their jurisdiction.
- Applies where there’s a personal obligation (e.g., contract, trust, fraud).
- The court acts on the defendant’s conscience, not directly on foreign land.
2. Incidental Issues in Trusts/Estate Administration:
- If foreign land issues arise incidentally in a case involving a trust or will with both English and foreign assets,
- The court can decide questions about foreign land for administrative purposes.
🏷️ Case: In Re Duke of Wellington
3. Admiralty Jurisdiction (Trespass to Foreign Land):
- The High Court can exercise admiralty jurisdiction in cases involving trespass or damage to foreign coastal property caused by ships.
- Such claims are enforceable through actions in rem.
⚓ Case: The Tolten
🔹 Crux:
While the Mocambique Rule limits jurisdiction over foreign land, English courts retain power when:
- The case involves a personal obligation,
- The issue is incidental to broader administration,
- Or the matter falls under admiralty law.
Capacity to transfer immovable property- Bank of Africa v Cohen
English private international law doesn’t recognize a transfer of immovable
property unless the transferee has the capacity to take under the lex situs.
🔹 Summary: Bank of Africa v Cohen
- A married woman, domiciled and resident in England, executed a contract in England agreeing to mortgage land in South Africa as security for her husband’s debts to an English bank.
- She later refused to complete the mortgage, and the bank sued for specific performance.
- She argued that under South African law, a married woman lacked capacity to act as surety for her husband unless certain conditions were met—which were not satisfied here.
🔹 Ruling:
- The court held that capacity to contract regarding foreign immovable property is governed by the lex situs (i.e., South African law).
- As the defendant lacked capacity under South African law, the contract was void, and specific performance was denied.
Legal Authority in English Law for succession
No one can deal with a deceased’s property
without court authority.
* Probate is granted to executors (if will
exists); Letters of Administration are granted if no will exists.
* Executors/Administrators manage the estate and
distribute the surplus as per applicable law.
Intestate/ testate Succession to
Immovables * Governed by lex situs (law of the place where the property is located).
TRANSFER OF MOVABLE PROPERTIES – TANGIBLE AND INTANGIBLE –four
theories
- Lex domicilii or the domicile theory= property has no fixed situs and the situs can be shifted anytime by the owner,
i.e., the property will follow the person. domicile of the person that will therefore determine the principles of transfer of such
property - Lex loci actus theory – in Alcock v. Smith for personal chattels= validity of transfer will be where transfer takes place like the execution is done, not their domicile
- Lex situs – lex situs theory with respect to transfer of goods advocates that the law
applicable must be the law of the country where the movable property is situated. - Proper law theory – according to Cheshire, the law that may be chosen to govern
questions arising out of the transfer of movables is the law of the country with which
the transfer has the most real connection. (this is very similar to the proper law of
contract theory). However, Cheshire admits that lex situs will be a more suitable theory
in so far as a third party is concerned.
Rabindra
N Mitra v. LIC – 1964 Calcutta HC
where the father assigned his life insurance policy to his son in Bombay, the sum assured also being payable in Bombay and the policy taken prior to partition of India, the Court held that the govt. of Pakistan cannot confiscate the policy irrespective of the fact that the premiums have been paid at the Dhaka branch. The court applied the proper law theory and held that the Indian law will apply.
- Studd v Cook: and In re miller
- Studd v Cook:
- Will used English terms; court used English law for
both English and Scottish property (focus:
construction). - In Re Miller
- Though the will followed Scottish form, English law
governed English land as it involved recognition of
property rights (focus: legal validity, not mere
interpretation).
- Though the will followed Scottish form, English law
Modern Law Approach regarding transfer of intangibles like debt
2 categories in voluntary assignment
1. question that depends upon validity of assignment itself like th ecapacity to assign. formality of assignment , essential validity etc
- questions that depend on THE VALIDITY OF OG TRANSACTION such as if the debt itself is payable
Republica de Guatemala v.Nunez:
President of Guatemala depositing money in an English
bank andrequesting the transfer of funds to his illegitimate son, Nunez.
He was disposed and imprisoned, and forced to assign the funds to the Guatemalan
Govt, which brought the present action to collect the money from the bank.
○ This assignment of 1919 was valid under English law, but void under the law of
Guatemala for two reasons:
■ being unsupported by consideration, it should have been made on a
stamped paper and signed by Nunez before a notary and
■ Nunez being a minor lacked the capacity to accept a voluntary assignment
The result was that amount went to the ex-President’s creditors
Lee v. Abdy
life insurance** policy was issued by an English company to one H, who was
domiciled in the Cape Colony.** Later H assigned this policy in favour of his wife;
the assignment was made in Cape Colony.
○ Assignment was valid by English law, but was void by the law of Cape, as a gift
between husband and wife. When the wife sued the insurance co for the recovery of
the money, the claim was met by the defence that the assignment was void.
○ held that validity of the assignment was governed by the Cape law,
as the lex loci actus.
● BothinLee.v.Abdy,and the Guatemala case lex loci actus, was applied for deciding the
question of validity of assignment.
Summary: Involuntary Assignment of Debt / Garnishment
🔹 Summary: Involuntary Assignment of Debt / Garnishment
- Garnishment is an involuntary assignment of debt where a judgment creditor attaches money owed to the judgment debtor by a third party (garnishee).
- Once the garnishee pays the creditor, they are normally discharged of liability under domestic law.
🔹 Conflict in International Context:
- In cross-border cases, a foreign court may not recognize the English garnishment order.
- This could result in the garnishee being sued again abroad for the same debt.
🔹 Case: Swiss Bank Corporation v. Boehmische Bank
- Plaintiff bank obtained a judgment in England against the defendant bank.
- Defendant bank (based in Czechoslovakia) had a £9,000 balance in a London bank.
- Plaintiff sought a garnishment order on that account.
- London bank objected, fearing they might be sued again in Czechoslovakia.
- Court of Appeal upheld the garnishment, as the debt was situated in England and unlikely to be contested abroad.
🔹 Legal Rule:
- Garnishment is allowed if the debt is situated in England.
- A debt is considered situated in England if:
- The garnishee is resident in England, and
- Effective legal action can be taken against them in England.
Interstate Succession to Immovable Property
🔹 Summary: Interstate Succession to Immovable Property
- Lex situs (law of the place where property is located) governs succession to immovable property.
- This is codified under Section 5 of the Indian Succession Act.
🔹 Section 5 – Key Rules:
1. Immovable property in India is governed by Indian law, regardless of the deceased’s domicile.
2. Movable property is governed by the law of the deceased’s domicile at the time of death.
🔹 Case: Govindan v. Lakshmi Bharathi
- Issue: Whether Dr. Govindan’s house in England should be treated as movable (subject to Indian law) due to a trust for sale.
- Court held:
- The classification of property as movable or immovable is determined by the law of the property’s location.
- If immovable, lex situs applies; if movable, lex domicilii applies.
🔹 Note:
- Scholar Morris criticizes the rule as outdated, noting that many countries now prefer lex domicilii even for immovable property.
Foreign judgement validity cpc
The doctrine of reciprocity has limited affect
wherein section 44A permits certain foreign judgements of superior courts notified by the
Central govt to have automatic affect in the country. Judgements even from these countries must be pronounced on the principles of competent jurisdiction which include – 1. Nationality or habitual residence of the judgement debtor
2. Express or implied submission of judgement debtor
3. Cause of action arising in foreign jurisdiction
Judgement contrary to Indian law or international law - S/13(c) and (f) are overlapping as they talk about breach of Indian law. In Pires v. Pires 1967 it was held that a judgement in breach of law of the state cannot be enforced.
🔹 Case Summary: Satya v. Teja Singh, AIR 1975 SC 105
🔹 Facts:
- Teja Singh obtained a divorce decree from a court in Nevada, USA, dissolving his marriage to Satya, an Indian woman.
- The decree was obtained ex parte (in the absence of Satya), who never appeared before the Nevada court.
- Later, Teja Singh remarried in India.
- Satya challenged the validity of the Nevada divorce decree in Indian courts, claiming it had no legal effect in India.
🔹 Legal Issue:
- Should an ex parte foreign divorce decree granted by a foreign court be recognized and enforced in India?
🔹 Supreme Court’s Ruling:
- The Nevada divorce decree was not valid in India.
- The decree violated Section 13 of the Code of Civil Procedure (CPC), 1908, which sets out conditions under which foreign judgments are recognized in India.
- Specifically:
- The foreign court lacked proper jurisdiction as per Indian law.
- The decree was not passed on the merits of the case.
- It violated natural justice because Satya had no reasonable opportunity to be heard.
🔹 Key Legal Principle:
- A foreign judgment or decree will not be recognized in India if:
1. The foreign court lacks jurisdiction as per Indian private international law.
2. It is ex parte and not decided on merits.
3. It violates natural justice (e.g., one party wasn’t heard).
4. It is fraudulent or against Indian public policy.
🔹 Crux:
Satya v. Teja Singh firmly established that India will not blindly recognize foreign divorce decrees, especially if they are obtained without jurisdiction or in breach of natural justice.
Would you like a one-liner test for when foreign judgments are recognized under Section 13 CPC?
