Proceedings brought against public bodies

We can now deal with proceedings brought against public authorities. The point of departure is the same: that the focus of attention is on the legal liability of the defendant to the claimant, and on the nature of the jus actionis. So if the liability sought to be enforced is the same as that owed by ordinary individuals in their private capacity, the claim against the authority should be seen as one arising in a civil or commercial matter. If, therefore, the contractor engaged to refurbish the mayoral office has not received payment from the city council for the work he has done, his claim against the council for payment will surely arise in a civil or commercial matter. If, by contrast, the authority is sued on the basis of a claim which is one peculiarly concerned with the liability of a public body for acts done by it in the exercise of its public powers, the proceedings will not be seen to arise in a civil or commercial matter. The principle is reasonably clear. For example, if a State has legislated to reduce the interest paid on sovereign bonds issued by it, exercising that power by virtue of a statute enacted to deal with a national emergency, proceedings brought against the State to challenge the exercise of those powers is not brought in a civil or commercial matter.^[1] If a claim is brought by an individual against a private company which has exercised public powers at the direction of a State, the claim will not lie in a civil or commercial matter; it is otherwise if the claim is brought against the company which has agreed for reward to perform services for the State, but is acting as a private company rather than one invested with special powers.

Occasionally the analysis which seems clear enough points to a conclusion which is simply, intuitively, wrong. In Lechouritou v Germany, proceedings were brought before the Greek courts by claimants who alleged that they had sustained loss and damage at the hands of the armed forces of the German State in the Second World War, it being argued that Germany was subject to the special jurisdiction of the Greek courts as Greece was the place of the harmful event in question. The European Court, however, ruled that the claim against Germany was not brought in respect of a civil or commercial matter in the first place, as it arose out of the exercise of public powers by a State. The fact that the claim could be (and had been) formulated and pleaded in private law terms - that a person who trespasses against the person or property of another commits a civil wrong in the nature of a tort, and where this is done by an individual for whom another is vicariously liable, civil liability may be enforced against that other - did not lead to the conclusion that the proceedings arose in a civil or commercial matter. The fact that the claim arose out of bellicose acts done in the exercise of public authority eclipsed the private law analysis.

The outcome makes sense if one accepts that liability for acts of war is only ever a matter of public law, and the legal consequences of war a matter of international or treaty law, not a matter of private law. It must also be likely that in any case in which a sovereign State, or an organ of the State, is sued and is entitled to plead immunity from the jurisdiction of the court, the claim is likely to fall outside the material scope of the Convention in any event, though in cases in which the immunity is invoked, the soundness of this proposition will not be put to the test. It must follow, therefore, that even if the claim may be advanced by the claimant on the basis of private law obligations which are owed by everyone - not to damage property without lawful excuse, not to injure persons without lawful excuse - alike, if the obligation arises from what is, in fact, the exercise of public authority, proceedings brought in relation to it will not fall within the material scope of the Convention. And although the Court did not put it this way, the same result may be derived from the reasoning in Owens

Bank Ltd v Bracco,ⁿ on the basis that if the broad, overarching, issue is outside the scope of the Convention, any issue which may arise within it is also excluded, even if it is formulated in a way which would, if it were taken in blinkered isolation, have been within the scope of the Convention.

States, and State authorities, discharge functions more humdrum than waging war. It is not clear whether the general approach in Lechouritou, which overrides the approach of concentrating on the content and nature of the legal relationship relied on, applies in more modest contexts. Take for example a claim brought against a local authority or other public body charged with the legal duty to inspect the quality of building work,^[2] or to ensure the compliance of a care home or children’s home or school with standards of safety and quality. It may be complained that the body was negligent in the discharge of its duties, and this negligence may have resulted in loss and damage, and that liability for negligence is in England a matter of ordinary civil law. But where the local authority acts in the performance or mis-performance of the obligations imposed on it as a public authority, it is more difficult to see a claim against it for defects in such performance as arising in a civil or commercial matter, even if it is also true that the standard of care or liability sought to be enforced is one familiar to the civil law of negligence. The position may be less clear where English law would provide a cause of action in tort for breach of statutory duty: the cause of action is plainly an ordinary tort; the duty which founds the claim to relief may be a duty formulated as a matter of public law, special and particular to the defendant. The amalgam is hard to place within or not within the Lugano Convention.

• [1] C-308/17 Hellenic Republic v Kuhn EU:C:2018:911, [2019] ILPr 125; c/C-226/13 Fahnenbrock v Hellenische Republik EU:C:2015:383, [2016] ILPr 89. 2 C-641/18 LG v Rina SpA EU:C:2020:349, [2020] ILPr 536; C-186/19 Supreme Site Services GmbH v SHAPE EU:C:2020:638. 3 C-292/05, [2007] ECR 1-1519. 4 The problems posed by State immunity and the limitation of claims as these applied to the instant case are not pursued here. 5 Article 5(3). 6 However, there are plenty of cases in which claims against the government for acts said to have been carried out by HM forces, or those allied with them, are treated as ordinary tort claims. Waging war, or putting down insurrection, is one thing; killing civilians and stealing their property is another. 7 And where not, not: a claim by an employee against the State in whose consular premises he was employed fell (obviously, it is submitted) within the material scope in C-154/11 Mahatndia v People’s Democratic Republic of Algeria EU:C:2012:491, [2013] ICR 1. The same principle must apply when the exercise of power, from which the claim arises, is delegated by the State to a person or body. 8 See Grovit v De Nederlandsche Bank NV [2007] EWCA Civ 953, [2008] 1 WLR 51 (action against Dutch Central Bank); though c/C-186/19 Supreme Site Services GmbH v SHAPE EU:C:2020:638.
• [2] C-129/92, [1994] ECR 1-117; see above, para. 5.08. 2 Murphy v Bren/ivoorfZ)C[1991] 1 AC 398. 3 Trent Strategic Health Authority v Jain [2009] UKHL 4, [2009] 1 AC 853. 4 For the purpose of defining the scope of Art. 1, it is irrelevant whether domestic law gives a cause of action in negligence or breach of statutory duty to the claimant; whether a tort was committed by the Trent Strategic Health Authority when it behaved with gross carelessness is nothing to the point. 5 C-343/04, [2006] ECR 1-4557. 6 However, for further proceedings, concerning whether the Austrian courts might issue an injunction on a quia timet basis, and by so doing infringe EU law on freedom of establishment (i.e. freedom to establish near the borders of the Austrian Republic), and also risk the non-recognition of any such judgment on the ground of public policy, see C-115/08 Land Oberdsterreich v CEZ AS (No 2) [2009] ECR 1-10265. It is not apparent on what basis the Landesgericht Linz considered itself to have jurisdiction, but Art. 22(1) cannot have been it.