State Immunity and Diplomatic Privileges in Civil Disputes

The Islamabad High Court addressed the claim of immunity by the State of Libya concerning a civil suit filed for recovery of repair costs related to property leased for use as a diplomatic mission (W.P. No. 02/2023). The Court allowed the petition and set aside the impugned order, which had characterized the lease agreement as a commercial transaction, and confirmed the State of Libya's immunity from the proceedings under the Diplomatic and Consular Privileges Act, 1972, and the State Immunity Ordinance, 1981.

Background:

The dispute arose when the Embassy of the State of Libya sought to vacate a property leased for diplomatic purposes in Islamabad. The landlord (respondent No. 2) claimed that repair work amounting to Rs. 1.645 million was required and refused to accept the keys unless payment was made. The State of Libya contended that the repairs fell within the landlord's responsibility under the lease agreement. Following this disagreement, respondent No. 2 filed a civil suit for damages. The State of Libya claimed immunity from the suit under diplomatic and state immunity laws.

Key Issues:

Diplomatic and State Immunity in Civil Proceedings: Whether the State of Libya enjoys immunity under the Diplomatic and Consular Privileges Act, 1972, and the State Immunity Ordinance, 1981, from the civil suit filed by the respondent seeking damages for repair costs.

Characterization of the Lease Agreement as a Commercial Transaction: Whether the lease agreement for diplomatic premises could be classified as a "commercial transaction", thereby stripping Libya of immunity protections.

Applicability of Section 17 of the State Immunity Ordinance, 1981: Whether the exceptions to immunity under Section 17 of the State Immunity Ordinance, 1981, apply when the leased property is used for diplomatic purposes.

Court's Analysis:

Diplomatic and State Immunity: The Court emphasized that diplomatic missions and their premises are inviolable under the Vienna Convention on Diplomatic Relations, 1961, as implemented through the Diplomatic and Consular Privileges Act, 1972. Article 31 of the Convention provides immunity to diplomatic agents from civil jurisdiction except in certain narrowly defined circumstances. The Court noted that this immunity extended to the property used for diplomatic purposes, shielding it from civil proceedings in Pakistan.

Mischaracterization of the Lease as a Commercial Transaction: The lower court had erred in classifying the lease agreement as a commercial transaction. The Court clarified that leasing property for the purpose of housing a diplomatic mission does not fall within the definition of a commercial transaction under Section 5 of the State Immunity Ordinance. The lease agreement was entered into for the purpose of the State of Libya's sovereign functions, and therefore, it did not qualify as a transaction that would waive immunity.

Exclusions to Immunity: Section 7 of the State Immunity Ordinance provides exceptions to immunity, specifically regarding immovable property. However, the Court held that Section 17(1)(b) of the Ordinance excludes these exceptions when the immovable property is used for diplomatic purposes. Thus, the claim for damages related to the repair of property used for Libya’s diplomatic mission was not subject to civil litigation in Pakistan.

Reciprocal Nature of Immunity: The Court highlighted the reciprocal nature of diplomatic and state immunity, noting that allowing civil suits against diplomatic missions could lead to adverse consequences for Pakistani missions abroad. The Federal Government’s certification confirmed that Libya enjoyed immunity from the proceedings, and the Court deferred to this position as required by Section 4 of the Diplomatic and Consular Privileges Act.

Court's Conclusion: The Islamabad High Court allowed the petition, ruling that the State of Libya enjoyed immunity from the civil proceedings initiated by respondent No. 2. The impugned order was set aside, and the civil suit was dismissed as barred by law. The Court also imposed costs of Rs. 100,000 on respondent No. 2 for improperly pursuing the case.

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