K v Socialist Republic of Vietnam

Date20 janvier 1981
CourtCourt of Appeal of Berne (Switzerland)
Switzerland, Court of Appeal of the Canton of Berne.
Socialist Republic of Vietnam

State immunity Immunity from jurisdiction Lease of premises as residence for ambassador Claim for rent arrears Acts iure gestionis and iure imperii Requirement of sufficient connection between legal relationship and forum

State succession Contract Annexation of territory Socialist Republic of Vietnam Whether successor to obligations of South Vietnam Principle of good faith The law of Switzerland

Summary: The facts:In 1971 South Vietnam leased a building in Berne for use as the residence of its ambassador. In 1975, following the collapse of the South Vietnamese regime, the ambassador proposed the rescission of the lease and the premises were subsequently vacated in a deplorable state. For more than a year, until they could be sold, no rent was paid either by the original tenant or by the Socialist Republic of Vietnam. In 1980 the lessor, K, instituted proceedings against the Socialist Republic, which failed to enter an appearance. The Court of Appeal of the Canton of Berne raised the question whether the Socialist Republic would have been entitled to invoke jurisdictional immunity and whether it had succeeded to the obligations contracted by its predecessor.

Held:The defendant would not have been entitled to jurisdictional immunity and had succeeded to the obligations in question.

(1) The lease had been concluded with the Ambassador of South Vietnam acting as a party and the diplomatic relations between Switzerland and South Vietnam had not been involved. The act in question was therefore performed iure gestionis and not iure imperii. Furthermore it was clearly established that there was a sufficient link between the legal relationship and Swiss territory.

(2) The Socialist Republic of Vietnam was not the result of dismemberment but constituted a single State formed on the territory of Vietnam. In general it succeeded to the rights of the former Republic of (South) Vietnam whilst at the same time it was obligated to assume the obligations corresponding to those rights. Any other solution would have been contrary to the principle of good faith. The conclusion of the lease unquestionably came within the framework of diplomatic representative functions and was therefore binding on the successor State.

The following is a statement of the facts as reported in Annuaire Suisse de droit international 1984, p. 138:

In 1971 a contract of lease was concluded between K and the...

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