Woo Anthony v Singapore Airlines Ltd (Civil Aeronautics Administration, Third Party)

[1] The defendant operates the airline known as Singapore International Airlines or, more commonly, ‘SIA’. They are being sued by a number of plaintiffs in respect of an accident in Taipei, Republic of China involving an aeroplane of the SIA. The defendant joined the Civil Aeronautics Administration of Taiwan (‘CAA’) as a Third Party to the actions. The CAA applied to set aside the third party proceedings on the ground that it, being a department under the Taiwan government is entitled to immunity from suit under s 3(1) read with s 16(1)(c) of the State Immunity Act, Ch 313. The application was heard by the learned assistant registrar who dismissed the third party’s application. The latter appealed before me on the narrow issue, here and below, that the CAA is immune from suit because it is part of the machinery of state, that is, the Republic of China, known as Taiwan.

[2] It is not disputed that the third party is a department of the Ministry of Transportation and Communications of the government of the Republic of China. Under the Civil Aviation Law and the Statute for Organisation of the Civil Aeronautics Administration, Ministry of Transportation and Communications, the third party is charged with the administration of civil aviation in the Republic of China. The application herein was for a declaration ‘that the third party be immune from the jurisdiction of the Courts of Singapore by virtue of s 3(1) read with s 16(1)(c) of the State Immunity Act, Ch 313’. Section 3(1) reads as follows:

Section 16(1) provides as follows:

It is also necessary to consider s 18 of the Act, which provision reads:

[3] On 20 June 2003, the defendant wrote to the Ministry of Foreign Affairs and sought a certificate under s 18. The letter is important and I shall set out the relevant portions verbatim:

The Ministry replied by letter dated 24 June 2003. The substantive passage in this reply reads:

The reply was signed on behalf of the Permanent Secretary of the Ministry. The third party had, similarly, applied for a s 18 certificate and was also given the same reply.

[4] Mr Loo, counsel for the third party submitted that the Republic of China is a state under s 3 and must be so recognised. He submitted further that even if there is no official recognition of that state by the government of Singapore, I ought to follow the principles of international law and draw a distinction between ‘de jure and de facto recognition’. Counsel argued that based on the history of dealings between the government of the Republic of China and Singapore, the Republic of China had been given a de facto recognition by the government of Singapore. Accordingly, this court ought to adopt the de facto position accorded to the Republic of China. Counsel submitted that if the government of Singapore had not made its position clear, then the court is entitled to enquire and determine whether there is a de facto recognition of the Republic of China. Mr Lok, counsel for the defendant submitted that the inability of the parties to obtain a s 18 certificate means simply that the Republic of China is not recognised as a state by the government of Singapore for the purposes of the State Immunity Act. As a subsidiary argument, Mr Lok submitted that in the event that the government’s position is found to be ambiguous, then this court should refer the question back to the Ministry rather than decide on its own whether there is a de facto recognition of the Republic of China.

[5] In support of his submission that this court ought to take into account the instances or circumstances relevant to the determination as to whether there is a de facto recognition of the Republic of China, Mr Loo set out a long history of the chronology of the landmark events in the relationship between the government of Singapore and the government of the Republic of China, including the signing of the double-taxation treaty to support his argument that there is a de facto recognition of the Republic of China. Mr Loo’s argument on the latter point was that a double-taxation treaty may only be signed by the government with another that is recognised de facto if not de jure.

[6] Mr Loo cited various authorities for his propositions that a state or government would enjoy locus standi in the courts of the United Kingdom whether it is recognised de jure or de facto (see International Law, 3 Ed. Rebecca Wallace). The Government of the Republic of Spain v S.S. Arantzazu Mendi. [1939] AC 256 and Bank of Ethiopia v National Bank of Egypt and Liquori [1937] 3 AER 8, are examples of cases in which the courts in the United Kingdom have recognised a de facto state. It is true that in some cases, such as that in the Arantzazu Mendi the government may recognises the de jure as well as the insurgent de facto states. The recognition of statehood is a matter that requires a common stand to be taken by all the organs of the recognising state. A view expressed in similar vein may be gleaned from the judgment of Roche J. in Aksionairnoye Obschestvo Dlia Mechaniches-Koyi Obrabotky Diereva (1) A. M. Luther (Company for Mechanical Woodworking A.M. Luther) v James Sagor and Company [1921] 1 KB 456. The legislature in the State Immunity Act conferred upon the executive, the power to make a conclusive determination whether a state or government is recognised for the purposes of the Act. In such circumstances, unless a clear discretion (emanating from a duty) is given to the courts, the question of the recognition of statehood will be determined by the certification under s 18 of the Act. The notion that a de facto recognition has equal importance as a de jure recognition may be an exaggerated idea. Lord Reid’s observation in Carl Zeiss Stiftung v Rayner and Keeler, Ltd and others (No. 2) [1966] 2 AER 536 case must not be overlooked. Indeed, I feel that it ought to be marked and hoisted as an early reminder. He there said: ‘De facto recognition is appropriate – and in my view is only appropriate – where the new government have usurped power against the will of the de jure sovereign.’ ibid page 547.

[8] Mr Loo advanced two ancillary arguments which I can deal with as briefly as they were advanced. First, he argued that if Taiwan is not a state because, in Mr Lok’s submission, the Singapore government recognises it as part of the Peoples Republic of China (Mainland China), then it must have immunity under the Act since the Republic of China has immunity and it is a recognised state, de jure and de facto. If the third party, claiming to be a department of the government of the Republic of China advances this as a serious argument then it will obviously be a strong argument, but unless it does so, I am not bound to consider this argument seriously. Mr Loo prefaced this submission with a strong caveat that that was not Taiwan’s stand.

[9] Mr Loo’s third and last argument was based on the proposition that if the Republic of China is not a foreign state recognised by the Singapore government then it will not have requisite locus standi in the courts to sue or be sued. It was an argument taken from the U.K. Supreme Court Practice, 1997 (Whitebook) at paragraph 4676:

Lord Reid in the Carl Zeiss Stiftung’s case expressed a powerful opinion in respect of the consequences that would flow if the German Democratic Republic (then East Germany) was not recognised. The Law Lord said:

The Carl Zeiss Stiftung’s case was commenced by the plaintiffs, a charitable foundation incorporated in 1986 in Jena, a district in the Grand Duchy of Saxe-Weimar. This district subsequently came under the jurisdiction of the German Democratic Republic (known as ‘East Germany’). Since 1945 when Germany was partitioned, East Germany was administered by the Union of Soviet Socialist Republic (USSR). In 1949 the USSR set up the German Democratic Republic to administer East Germany, purportedly as a sovereign state. The USSR, in fact, retained overall control. When the East German plaintiffs sued various parties for infringing its intellectual property rights, one of the defences of the defendants was that the courts in the plaintiffs should not be recognised as having legal authority to commence the action. Their argument was based on a certificate issued by the UK government. As early as 1945 the UK government recognised the USSR as the de jure entitled to exercise governing authority in East Germany. Then in 1964, it granted a certificate stating that Her Majesty’s government has not recognised either de jure or de facto any other authority, that is, in the context any other authority than the government of the USSR. The Court of Appeal accepted this argument and allowed the appeal by the defendants (whose application was rejected by Cross J at first instance) on the basis that the East German government received no recognition by the U.K. government. The House of Lords allowed the plaintiffs’ appeal on the grounds, inter alia, that there was nonetheless a governing authority and that governing authority of East Germany was still the USSR, as so certified by the government in its certificate of 1964. Thus, Lord Reid, in the passage quoted above, was anticipating adverse and disastrous consequences should the plaintiffs and other corporate entities be not recognised as legally incorporated because the government under which they belong is itself not recognised. In the present case, there is, in my view, no danger of deracinating Taiwanese companies trading here. Nonetheless, the fears expressed by the Law Lords in Carl Zeiss Stiftung, particularly Lord Reid and Lord Upjohn who said that it would be ‘a most deplorable result in respect of any highly civilised community, with which we have substantial trading relationships I believe, which should be avoided unless our law compels that conclusion’ (ibid page 569), need to be addressed. In short, if the CAA is a department of a government that is not given de jure or de facto recognition by this state, then what is it? It is an entity that is real but is not a state recognisable for the purposes of the State Immunity Act. That leads to the next question. Are we creating a third category of states apart from de jure and de facto? In my view, there is only one kind of state. It must be real and satisfies all the criteria for statehood. That is, it must have territory, a population, and a government capable of maintaining effective control. There is, however, more than one aspect of recognising such a state. The state may be recognised as de jure or de facto, or in the courts of a foreign state, merely as an existing entity proclaiming to be a state. In this situation, no immunity is accorded and the ‘state’ so recognised, may be sued in the courts of the foreign state. It follows, conversely, that it can also sue in those courts. And lastly, such a ‘state’ may not receive any recognition at all; that is, to be regarded as a non-entity. The consequences feared by the British courts can also be overcome or mitigated in many ways, some of which have been applied by the American courts in cases such as U.S. v Home Assurance Co (1874), 89 U.S. 99 and Sokoloff v National City Bank of New York (1924) 239 N.Y. 158.

[10] Mr Loo relied on the American case of Wulfsohn v Russian Socialist Federated Soviet Republic 234 N.Y. 372, 138 N.E. 24 in which Andrews J expressed the view that the Russian Federated Soviet Republic was the existing de facto government, as admitted by the parties, ‘[o]therwise there is no proper party defendant before the court’. Hence, he concluded that if the government of the Republic of China is not recognised, then, in the words of the court in another American case, the government of the Republic of China was not an existing government and cannot be sued because ‘there was no party before the court’. See Russian Socialist Federated Soviet Republic v Cibrario 235 N.Y. 255, 139 N.E. 259. The paradoxical nature of the above proposition that an unrecognised government enjoys immunity in the courts of foreign states seems to find its root in Wulfsohn’s case and given implicit endorsement in academic texts such as Professor von Glahn’s ‘Law of Nations’, sixth ed. Page 87, 108 which explained that the proposition was based on the logic that ‘you cannot sue something whose existence you deny’. This is a paradoxical puzzle not unlike Russell’s Paradox (the set of all sets that do not contain themselves as members), a simpler version of which is expressed in this way: ‘The barber cuts the hair of everyone in the village who does not cut his own hair.’ Does the barber cut his own hair? Philosophical and mathematical paradoxes are contradictions with no solutions. The present matter before me need not, and in my view, should not be expressed in a paradoxical form merely to avoid a solution or result that is not attractive. First, the definition of a de facto state is necessary solely for the purposes of giving effect to the State Immunity Act. The incongruous situation of having an entity that looks like a state, behaves like a state, is treated like a state, and yet not be recognised by a court of law as a state, is in my opinion, the lesser contradiction. It is a greater contradiction to have an entity given immunity when its existence is recognised de jure or de facto, and also when it is not recognised at all.

[11] Secondly, if Wulfsohn represents judicial thinking since the 1920’s, the policy may require a re-examination. It is to be noted that this principle of according immunity to a state that is not recognised as such, rose from judicial policy and found widespread acceptance as such. I hold the view that any entity that purports to be a state or a government of a state that is not recognised de jure or de facto does not enjoy immunity from suit. I will, for my part, decline to fashion an alternative name for such so-called ‘governments’ or ‘states’ and will refer to them as I did above, as entities. Such entities can be as spurious as a group of insurgents who had installed itself as the government in some small territory; or it can be one which is established and stable, and with which governments elsewhere deal with on friendly terms, such as the Republic of China. Whether such entities are given de jure or de facto recognition is best left to the executive, as the legislature in enacting the State Immunity Act has seen fit. Otherwise, it will not be possible - if I may use the words of Lord Atkin in the Arantzazu Mendi case - for the executive and the judiciary to speak with one voice on such matters. The proper recognition of a sovereign or a sovereign state is not normally a function of the judiciary. Recognition by the court follows recognition by the state to which that court belongs.