Zhongshan Fucheng Investment Co Ltd v The Federal Republic of Nigeria
[2023] EWCA Civ 867
Zhongshan Fucheng Industrial Investment Co Ltd v The Federal Republic of Nigeria
14 June 2024
[2024] EWHC 1503 (Comm)
High Court
A company won a big money case against Nigeria. Nigeria wouldn't pay, so the company tried to seize two of Nigeria's buildings. Nigeria said it couldn't be done because the buildings were for official use, not business. But the judge said the buildings were rented out as apartments, which is a business, so the company can seize them.
Key Facts
- •Zhongshan obtained a $55,675,000 arbitration award against Nigeria.
- •Nigeria failed to pay the award, leading to enforcement proceedings.
- •Zhongshan sought final charging orders over two Nigerian-owned properties in Liverpool.
- •Nigeria claimed state immunity and procedural irregularities.
- •The properties were rented out to residential tenants.
Legal Principles
State immunity from jurisdiction, except as provided in the State Immunity Act 1978 (SIA).
State Immunity Act 1978
Service of documents on a foreign state must be through the Foreign Commonwealth and Development Office (section 12(1) SIA), unless it is a further step in existing proceedings.
State Immunity Act 1978, section 12(1)
Charging orders can be made against a state's property if it's used for commercial purposes (section 13(4) SIA). 'Commercial purposes' are defined in section 3(3) and section 17(1) of the SIA.
State Immunity Act 1978, sections 3(3), 13(4), 17(1)
A certificate from the head of a state's diplomatic mission is sufficient evidence that property is not used for commercial purposes, unless the contrary is proved (section 13(5) SIA).
State Immunity Act 1978, section 13(5)
The court has discretion to make a charging order final (CPR 73.10A).
CPR 73.10A
Full and frank disclosure is required when applying for charging orders.
Inherent to court procedure
Outcomes
The final charging orders were granted.
The court found that the properties were being used for commercial purposes because they were rented out to residential tenants, even if at below-market rent. The certificate from the Nigerian High Commission was rebutted by evidence showing the properties' use for residential tenancies.
Section 12(1) SIA did not apply to the charging order application.
The application was deemed a further step in the existing enforcement proceedings, not the initiation of new proceedings.
Nigeria's claim of insufficient disclosure was rejected.
The court found that Nigeria's claims of misleading information were not accurate or relevant.
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