ANISMINIC LTD v. FOREIGN COMPENSATION COMMISSION [1969] 2 AC 147, [1969] 2 WLR 163
I.
INTRODUCTION
ANISMINIC LTD v. FOREIGN COMPENSATION COMMISSION is an important House of Lords decision in the area of English administrative law, establishing in particular that any error of law made by a public body will make its decision a nullity ^Y=kH;dj &and that a statutory exclusion clause does not deprive ^wysñ lrkjd& the courts from their jurisdiction in judicial review unless it expressly states this.
II. FACTS OF THE CASE
As a result of the Suez Crisis some mining ^m;,a& properties of the appellant Anisminic located in the Sinai peninsula were seized ^;ykï lrkjd& by the Egyptian government before November 1956. The appellants then sold the mining properties to an Egyptian government-owned organisation called TEDO in 1957.
In 1959, a piece of subordinate ^wm%Odk& legislation was passed under the Foreign Compensation Act 1950 to distribute compensation paid by the Egyptian government to the UK government with respect to British properties it had nationalised.^cki;=& The appellants claimed that they were eligible ^iqoqiqlï we;s&for compensation under this piece of subordinate legislation, which was determined by a tribunal ^m¾Ioh&(the respondents in this case) set up under the Foreign Compensation Act 1950.
The tribunal, however, decided that the appellants were not eligible for compensation, because their "successors in title" (TEDO) did not have the British nationality as required under one of the provisions of the subordinate legislation.
III. ISSUES
There were two important issues on the appeal to the Court of Appeal and later, the House of Lords. The first was straightforward^wjxl&: whether the tribunal had made an error of law in construing the term "successor of title" under the subordinate legislation.
The second issue was more complex and had important implications ^jHx.d¾:h& for the law on judicial review. Even if the tribunal had made an error of law, the House of Lords had to decide whether or not an appellate court had the jurisdiction to intervene ^ueosy;a fjkjd& in the tribunal's decision. Section 4(4) of the Foreign Compensation Act 1950 stated that:
"The determination by the commission of any application made to them under this Act shall not be called into question in any court of law".This was a so called "ouster clause".
IV. THE HOUSE OF LORDS' DECISION
Anisminic Ltd v Foreign Compensation Commission [1968] APP.L.R. 12/17
Before Lords Reid; Morris; Pearce; Wilberforce; Pearson (17th December 1968)
LORD REID:
MY LORDS,
1. In 1956 the Appellants owned ^i;=$ ysus& a mining property in Egypt which they claim^whs;sjdislï lshd mdkjd& was worth over £4,000,000. On the outbreak^me;srSu& of hostilities^hqoaO$igka& in the autumn ^ir;a iD;=j&year it was occupied ^ika;l l<d& by Israeli forces and damaged to the extent ^m%udKh& of some £500,000. On 1st November 1956 property in Egypt belonging to British subjects ^hg;a& was sequestrated ^w,a,d .;a;d&by the Egyptian Government and on 29th April 1957, after the Israeli forces had withdrawn ^miq neiaid&, the Egyptian Government authorised ^n,h ,nd ÿkakd&a sale of the Appellants' property and it was sold to an Egyptian organisation referred to in this case as T.E.D.O.
2. The Appellants' property had included a large quantity^m%udKhla& of manganese ore ^uex.kSia f,day iys; mia& and steps were taken by them to dissuade ^fkdlsSÍug leu;s lrjd .kakjd& their customers from buying ore from T.E.D.O. This seems to have embarrassed^wmyiqjg m;a l<d& the Egyptian authorities, and on 23rd November 1957 an agreement was made between the Appellants, T.E.D.O. and the Sequestrator ^foam, ;ykï lrkakd&General whereby the Appellants purported^woyia l<d& to sell to T.E.D.O. for a price of £500,000 their whole business in Egypt, but this was not to include any claim which the Appellants might be entitled to assert against any government authority other than the Egyptian government, as a result of loss suffered by, or of damage to or reduction ^ydhkh$wvq lsÍu& in the value of" their business or assets^j;alï& during the events of October and November 1956.
3. Beyond ^Tíng& the fact that the Appellants received the sum of £500,000 the effect of the agreement is not very clear; for their property had already been sold to T.E.D.O. by the Sequestrator. Before the agreement was made the Appellants had no legal right to sue ^kvq lSug& in Egypt either for the return of their property or for compensation for its loss. But they had some hope or prospect of getting something after relations between the United Kingdom and the United Arab Republic returned to normal. This could have been a direct payment to them by the Egyptian Government: or, if the method was followed which the British Government had adopted in earlier cases, the
Egyptian Government might pay a lump ^l=Üáh$ fkdleue;af;ka bjid isákjd& sum of compensation to the British Government to cover all claims by British subjects, and then it would be in the discretion of the British Government to determine ^ksYaph lr .ekSug& how any such sum should be distributed among claimants ^ysñlï mdkakka&. And similarly with regard to damage done by the Israeli forces there might have been some payment made by the Israeli Government. It is not disputed^jdo l<d& that by this agreement the Appellants gave up or assigned ^mjrd fokjd& to T.E.D.O. any claim they might have to receive compensation directly from the Egyptian Government : but I think that they did not give up or assign^kshu lrkjd& any claim, hope or prospect they might have to receive something from the British or Israeli Governments.
4. The next material event was the making of a treaty between the Governments of the United Kingdom and the United Arab Republic on 28th February 1959. That treaty provided for the return to British subjects of their sequestrated property excepting properties sold between 30th October 1956 and 2nd August 1958: those excepted properties were listed in Annex E which included the property of "Sinai Mining (subject to a special arrangement)". Sinai Mining was the name of the Appellant company before its name was changed to Anisminic. It is not clear what was meant by "subject to a special arrangement". Under the treaty the United Arab Republic
paid to the British Government the sum of £27,500,000 in full and final settlement of claims of a kind mentioned in Article IV. It is not disputed that at that stage the Appellants had no legal right to claim to participate in that sum. The disposal ^yudr lsrSu& of that sum was in the discretion of the British Government. The most the Appellants had was a hope that they would receive some part of it.
5. This case arises out of the making of an Order in Council: - The Foreign Compensation (Egypt) (Determination and Registration of Claims) Order 1959, S.I. 1959 No. 625. That Order has now been superseded^wj,x.= lrkjd& by a similar order, S.I. 1962 No. 2187 and I shall refer throughout to this later order. These orders were made under powers contained in the Foreign Compensation Act 1950. That Act set up the Respondent, the Foreign Compensation Commission, to deal with compensation payments made by the Governments of Yugoslavia and Czechoslovakia but it also provides for the Commission acting should there be future compensation agreements with foreign governments.
6. The Appellants duly^iqoqiq mrsÈ& submitted a claim under this Order to the Respondent Commission. They also submitted a separate claim in respect of damage done by the Israeli forces. These claims were opposed ^úreoaO j ke.S isáhd& by the Legal Officer of the Commission and after sundry^jsúO& procedure including a long oral hearing the Commission on 8th May 1963 made a Provisional Determination that:
"... the above-named Applicants, Anisminic Limited, fail to establish a claim under the Egypt Order aforesaid ^Wla;& in respect of the matters referred to in paragraph 2(a) of the Amended Answer AND THAT the Application in respect of such claims be and is hereby dismissed BUT THAT the claim in respect of damage referred to in paragraph 2(b) of the Amended Answer is fit for registration under Article 8 of the said Order in a sum to be hereafter determined."
7. The claim which was dismissed was the main claim with which this case is concerned, and the claim which was held fit for registration was a claim in respect of the damage done by the Israeli forces.
8. Browne J. on 29th July 1966 made a declaration that the Respondent's Provisional Determination was a nullity and that the Respondents are under a statutory duty to treat the Appellants' first claim as established. The Court of Appeal on 5th April 1967 set aside the judgment of Browne J. and the Appellants now seek to have his judgment restored ^m%;sIaGdmkh l<d&....
V. RULING
By a 3-2 majority, the House of Lords decided that section 4(4) of the Foreign Compensation Act did not preclude^ndOd lrkjd& the court from inquiring whether or not the order of the tribunal was a nullity, and accordingly it decided that the tribunal had misconstrued^jrojd f;areï .kakjd& the legislation (the term "successor in title" kS;Hkql+, wkqm%dma;slhd), and that the determination by the defendant tribunal that the appellant did not qualify to be paid compensation was null^wNsY=kH$wj,x.=&, and that they were entitled to have a share of the compensation fund paid by the Egyptian government.
VI. EFFECT OF THE DECISION
The decision illustrates the courts' reluctance ^wleue;slu& to give effect to any legislative provision that attempts to exclude their jurisdiction in judicial review. Even when such an exclusion is relatively clearly worded, the courts will hold that it does not preclude them from scrutinizing ^ishqï f,i mÍCId lsÍfuka& the decision on an error of law and quashing^ksYam%Nd lsÍu& it when such an error occurs.
It also establishes that any error of law by a public body will result in its decision being ultra vires.
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