Société Bauer-Marchal v Ministre des Finances de Turquie

Date29 janvier 1957
CourtRegional Court (France)
France, Court of Paris.
Société Bauer-Marchal
Ministre des Finances de Turquie.

Jurisdiction — Exemptions from — Foreign States — Foreign State as Guarantor of Obligation Undertaken by Foreign Municipality — Issue of Loan by Foreign Municipality — Default of Foreign Municipality — Whether Foreign Government Subject to Jurisdiction of Local Courts under Guarantee — The Law of France.

The Facts.—In 1913, the City of Constantinople issued loans payable in gold francs, and the relevant loan certificates stated that the Imperial Ottoman Government guaranteed the discharge of the obligation of the City of Constantinople “unconditionally”. In 1931 the Tribunal Civil de la Seine gave judgment against the City of Constantinople in favour of a French holder of loan certificates, and in 1935 the benefit of this judgment was extended (as provided in a French Decree-Law of August 8, 1935) to the plaintiffs herein, who, as holders of loan certificates, accordingly became judgment creditors of the City of Constantinople. The efforts of the plaintiffs to obtain payment from the City of Constantinople were unsuccessful, and they now brought an action for payment against the Turkish Republic in the latter's capacity as guarantors. The Turkish Government claimed immunity from the jurisdiction of the French courts.

Held: that the Turkish Government was immune from the jurisdiction of the French courts. In acting as guarantors for the City of Constantinople the Turkish Government had acted in a sovereign capacity, and the French courts were accordingly not entitled to exercise jurisdiction.

The Court said: “By an order of the President of the Tribunal Civil de la Seine dated August 14, 1935, the appellants—in accordance with the provisions of the Decree-Law of August 8, 1935—obtained the benefit of a judgment of the Tribunal Civil de la Seine of October 28, 1931, in favour of one d'Arjuzon, who was also a bondholder of the same loan issue. … This judgment...

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