Duff Development Co v Government of Kelantan

Facts

• The Duff Development Company entered into a concession agreement with the Government of Kelantan (a Malay state under British protection)
• A dispute arose and the company obtained an arbitration award against Kelantan
• When the company sought enforcement in English courts, Kelantan claimed sovereign immunity
• The company argued Kelantan was not truly a sovereign state because it was a British protectorate
• The Crown issued a certificate confirming that it recognised Kelantan as a sovereign state

Issue

1. Whether English courts were bound by the Crown's certificate regarding the sovereign status of Kelantan, and whether Kelantan was entitled to sovereign immunity.

Held

• The Crown's certificate is conclusive and binding on the courts
• Courts cannot go behind the executive's position on recognition
• Recognition is a political act of the executive, not a judicial determination
• Kelantan was entitled to sovereign immunity from suit
• The independence of the judiciary does not extend to overriding the executive's foreign affairs determinations on recognition

Ratio Decidendi

Whether a foreign entity is a sovereign state or government is a question for the executive, not the judiciary. When the Crown issues a certificate on this matter, English courts are bound by it. The executive determination is conclusive and cannot be questioned or contradicted by judicial proceedings. This reflects the constitutional division between foreign affairs (executive) and adjudication (judiciary).