AELF MSN 242, LLC v DE SURINAAMSE LUCHTVAART MAATSCHAPPIJ N.V. D.B.A. SURINAM AIRWAYS

Section 12(1) of the State Immunity Act 1978 requires service through the Foreign, Commonwealth and Development Office only in proceedings against a State. A separate entity under section 14(1), although potentially entitled to substantive immunity under section 14(2), does not receive that procedural privilege unless the Act expressly provides otherwise. The character of the entity’s conduct is therefore irrelevant to the service question. In any event, where section 12(1) applies, section 12(6) permits an alternative method of service agreed objectively by the defendant entity. Subjective intention and governmental authorisation are immaterial to that agreement.

The claimant, an aircraft leasing company, sued the defendant, Suriname’s national airline, for breach of a settlement agreement concerning sums due under an aircraft lease. The defendant challenged jurisdiction under CPR rule 11(1), arguing that it was a separate entity within section 14(1) of the State Immunity Act 1978 and should have been served through the Ministry of Foreign Affairs under section 12(1).

The court had previously dismissed the jurisdiction challenge, holding that the defendant had submitted to the jurisdiction by common law waiver and had made an appearance for section 12(3). Before the order was sealed, the court considered the remaining service issues and whether permission to appeal should be granted.

1. The court held that it was permissible, before the order was sealed, to determine additional grounds supporting the order already made. The overriding objective favoured avoiding duplicated appeals, delay and unnecessary costs. The jurisdiction described in AIC Ltd v Federal Airports Authority of Nigeria was concerned with reconsidering an order, whereas the present exercise considered further grounds supporting it.

2. SLM was a separate entity within section 14(1) of the State Immunity Act 1978. The statutory structure distinguished substantive immunity from procedural privileges. Section 12(1) expressly applied to proceedings against a State, while section 14(1) excluded an entity distinct from the executive organs and capable of suing or being sued. Sections 14(3)–(6) demonstrated that express words were used where procedural privileges were extended to separate entities or constituent territories.

3. Accordingly, SLM was not entitled to service under section 12(1). The court did not need to decide whether entering the settlement agreement was an act in the exercise of sovereign authority. It nevertheless considered that the agreement was commercial in character. Government ownership, governmental direction or a benefit to the State would not by themselves make the act governmental.

4. Alternatively, if section 12(1) applied, SLM had objectively agreed under section 12(6) to service by collecting the Claim Form from the Bailiff. The defendant’s subjective intention and any authorisation from Suriname were irrelevant. Service was therefore valid and effective.

5. SLM’s application contesting jurisdiction was dismissed. This was additional to the earlier findings that SLM had submitted to the jurisdiction by common law waiver and had appeared for the purposes of section 12(3).

The judgment itself records an earlier procedural judgment dated 21 December 2021, which granted SLM an extension of time and dismissed its jurisdiction challenge based on alleged defective service. The present judgment determined the remaining service issues before deciding whether permission to appeal should be granted.