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Limited Immunity


|   Elad Man, Adv & Zvika Barak, Adv

Many are the statutes that occupy our legal code, not all of them familiar in spite of their great importance and it seems that every now and then there is one piece of legislation still missing from the knowledge and awareness of those who need it the most.

Such is the foreign states immunity law, 5769-2008, that since it was enacted, it seems that lawyers, legal parties and even many judges, are not aware to its existence and provisions that lay out a specific procedural path, and continue to practice according to the normal ordinary procedural rout, not applicable to anyone covered by this new legislation.


Maybe it would be best to start with a few general words of explanation regarding the law. This piece of legislation, passed on the Knesset on the fifth of November 2008, is the outcome of the desire to resolve the status and the extant of the foreign states immunity under Israeli law. This issue was raised by the need to reflect in legislation and in a defined and orderly manner, the tendencies of Israeli common law throughout the years and was mainly defined by the recognition relative immunity instead of full one, as also occurred in different countries like England, Canada, Australia and the USA. 


As a general rule, section 2 of the law states that the foreign state will have immunity from the jurisdiction of the Israeli courts, excluding criminal matters and subject to the provisions of the law. At the same time, the law sets number of conditions, that when fulfilled, the foreign state will not have immunity. These are the cases concerning cause of claim which is of commercial nature, or dealing with employment law, trusts, insolvency, intellectual property, torts committed in Israel, marin vassals and inheritance law.    


On top of all material declarations and definitions, it is obvious that the law has made important change also on the practical and procedural ground that is not known also to the professionals dealing with this matter. Section 13 of the law states that a claim filed against a foreign state and any judgment given ex parte, with no defense, will be served through the Israeli foreign ministry to the foreign ministry of the foreign state. The meaning of such order, is that any attempt to serve the local representative of the foreign state or its attorneys, will be void as if never existed. The principle of constructive knowledge of the legal proceedings will not apply due to this strict procedure set out in the new legislation, in order to preserve the required balance, complexity and sensitivity regarding the international relationships of the state of Israel. It is required also for the compliance and compatibility to international standards and due process.


Not satisfied by that, the legislator has set additional procedural rules, stating that the response of the foreign state to the claim filed against it or to the ex-parte judgment will be submitted to the court within 60 days of receiving it by the foreign ministry of that state and the court can extend this period according to its discretion. It is important to say, that in cases where the defendant is a foreign body i.e. a governmental authority in the foreign state that has separate legal personality from the government of that state, this specific procedure will not apply and the regular procedure will be the right path to follow regarding serving and responding to a claim.  


The reformed legislation also provides that the court will issue a judgment against the foreign state in the absence of any statement of defense, only if it was persuaded that thw foreign state is not entitled to immunity from its jurisdiction, according to the law. It is well known that many times the foreign states do not even respond to the claim, so a mechanism of evaluating the claim also without any response by the foreign state, will prevent the issuing of ex-parte judgments in cases of applicable immunity.


It seems that due to the sensitivity of serving a foreign state with documents, the legislator thought that it would be right and proper to set the procedure in a parliament act and not secondary legislation (regulations). It was also mentioned in the explanations to the suggested legislation that the custom is  that serving diplomats is being done through diplomatic channels the foreign affairs ministry (also see rule 494 to the civil procedure regulation). Therefore, the suggestion was to do the same regarding claims against foreign states.


The new law also gives the foreign state immunity from the process of enforcing the judgment that may be issued against it. The assets of the foreign state are protected from seizure or liquidation and in edition excluding criminal proceedings no fine or imprisonment will be imposed upon the foreign state or anyone acting on its behalf, for not exercising a judgment or any other courts decision. Again, also in this case there are limitation to such immunity and it will not apply to real estate in Israel or commercial  assets as well as assets gained through inheritance, gift or winning a no owners property.  


Some will say that these procedural instructions are not sufficient to declare a dramatic change of the legal situation prior to the legislation. Even though, we think that the importance of this legislation is to be measured by its mere existence and by the declarative norms set by it for litigating with foreign states. Like lawyers, judges and other participators in the legal game the foreign states themselves are not aware necessarily to the new provisions of this law and to the procedural rules it contains. From time to time, one can see mistakes done by a diplomatic mission, taking steps with no real need or use only due to this lack of knowledge.


Therefore plaintiffs and defendants and their attorneys will be better served by knowing and carefully implementing and following the reformed procedure. Sometimes, all we have is procedure, directing us and navigating things within the legal arena. The foreign diplomatic mission and gain valuable precious time as long as it will insist that the right procedural demands will be fulfilled and will not except any document served by wrong actions of claimants attorneys unfamiliar with the law. Sometimes these issues can have dramatic affect on the outcome of the litigation and to they should be considered carefully while planning the legal strategy and tactic being used, especially regarding employment law and when the employee is not an Israeli citizen. 


*The writers are the founders of Man-Barak Advocates & Solicitors, practicing international commercial law and litigation and consult several foreign missions and states.

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