High Commissioner of Pakistan in the UK v Prince Mukkaram Jah and Others [2016] EWHC 1465

The proceedings concern competing claims for ownership of a fund worth approximately £35 million held by the National Westminster Bank Plc (the “Fund”). The Fund was held in an account which was opened in London in 1948 by the first High Commissioner for Pakistan on the instruction of the Foreign Minister of Pakistan. The seventh Nizam of Hyderabad (the “Nizam”) provided the money for the Fund. In 1958, by virtue of the sovereign immunity enjoyed by Pakistan, the House of Lords stayed certain proceedings brought by the Nizam against the High Commissioner, resulting in the assets of the Fund being frozen. In 2013, ownership proceedings recommenced, with rival claims being advanced by Pakistan (waiving its sovereign immunity by its participation), India and two grandsons of the Nizam (the “Princes”).

In 2015 and 2016, the parties brought competing applications for summary judgments or strike out relief. Subsequently in 2016, Mr Justice Henderson refused each of the applications and decided that the case must proceed to a full trial.

Henderson J held that Pakistan’s claims have a real prospect of success, including Pakistan’s claim that ownership of the Fund (which was created by an act of State) is non-justiciable in the English courts. Henderson J held that the fact that the acts in question took place outside of Pakistan and Hyderabad does not preclude the invocation of the act of State doctrine. Further, while Hyderabad is no longer a State, it was a State at the time of the disputed acts. Finally, Henderson J held that it is not an abuse of process for Pakistan to claim non-justiciability after having waived its sovereign immunity.

In relation to the remaining issues to be determined, Henderson J found that one of Pakistan’s statutory limitation defences had no real prospect of success. Nevertheless, he decided not to strike it out at this stage, in order to avoid the possibility of Pakistan appealing his decision and delaying the core proceedings. Henderson J rejected all other applications for strike out relief and summary judgment, including Pakistan’s application that India’s claim for restitution had no real prospect of success.