Dumez v Iraq

CourtCourt of Cassation (France)
Date15 juillet 1999
France, Court of Cassation (First Civil Chamber).

(Lemontey, President; Bargue, Rapporteur; Gaunet, Advocate General)

Iraq and Others1

International organizations United Nations Security Council Powers to maintain international peace and security Security Council Resolutions Effect under municipal law Resolution No 687 (1991) Imposition of levy on Iraqi petroleum exports to compensate victims of Gulf War Whether restricting sovereignty of Iraq Whether depriving Iraq of immunity from execution

State immunity Attachment and execution Scope of immunity Enforcement of judgment against funds held in foreign bank accounts at Iraqi banks Whether foreign State entitled to invoke immunity from execution to oppose application for enforcement Whether Iraqi banks constituting emanations of foreign State Whether banks in practice deprived of their independence or acting in normal commercial manner

State immunity Attachment and execution Bank accounts Funds allegedly allocated for sovereign functions Criteria for determining whether funds immune from attachment

Economics, trade and finance State contracts Liability for debts Enforcement of judgment against foreign State The law of France

Summary: The facts:In July 1990 Dumez, a French company, obtained a judgment from an Iraqi court for payment of a debt owed under a building contract performed for the Iraqi Defence Ministry. In August 1990 Iraq invaded Kuwait and enacted Law No 57 which prohibited the Iraqi courts from exercising jurisdiction over any proceedings against the Iraqi State, and thereby prevented Dumez from enforcing its debt in Iraq. Dumez then brought an action before the Tribunal de grande instance of Nanterre and, by a judgment of 9 October 1991, was awarded the sum of US $22,000,000. On the basis

of this judgment, Dumez obtained conservatory attachment orders over funds held in bank accounts of the Iraqi State in Paris (in 1992) and in Brussels (in 1993). Iraq appealed against both the attachments and the judgment of the French court on the merits. The attachments were upheld by a judgment of the Tribunal de grande instance of Paris of 25 May 1994 but this judgment was quashed by the Court of Appeal of Paris, by a judgment of 3 July 1997, on the ground that the funds at issue were held for the Embassy of Iraq and therefore were not subject to attachment since, despite the international sanctions to which it was subject, Iraq remained a sovereign State and was still a member of the...

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