Haji-Ioannou & Ors v Frangos

Mr Frangos appeals from two orders made by Master Fontaine. By the first order made on 13^th January 2009 under the provisions of Council Regulation 44/2001 (the ‘Regulation’) the Master registered an Order in favour of Loucas Haji-Ioannou (‘LH’) made by the Greek Court of Appeal on 12^th May 2008 (the ‘Registration Order’). Two days after the application for registration of the judgment was issued, on 17^th December 2008 LH died. By the second order on 3^rd June 2009 (the ‘Substitution Order’) the Master substituted as Applicants, Nedi Haji-Ioannou (‘NH’) the widow of LH, and his children, Strylianos Haji-Ioannou (‘SH’), Polys Haji-Ioannou (‘PH’) and Clelia Haji-Ioannou (‘CH’) who will be referred to as ‘the Applicants’. References in this judgment to Articles are to articles in the Regulation unless otherwise indicated.

This is the latest round in this jurisdiction of a long dispute in which the late LH claimed repayment of sums totalling $49,035,918 from Mr Frangos, his former son-in-law. It was not necessary to consider the substance of the claim for the purposes of this appeal. LH contended that the money had been paid to Mr Frangos as a loan. Mr Frangos maintained that the sums were paid as a gift. The dispute has been the subject of litigation in this country in which Mr Frangos successfully challenged the jurisdiction of the English courts over the claim. The judgment of the Court of Appeal is reported as Haji-Ioannou v Frangos [1999] 2 Lloyd’s Reports 337. LH Haji-Ioannou then pursued his claim in Greece. The Greek Court of Appeal gave judgment for LH. On 17^th November 2008 the Greek Supreme Court heard an appeal by Mr Frangos from the judgment of the Greek Court of Appeal. On 16^th February 2009 it dismissed his appeal. The registration of the judgment is a preliminary step in seeking to enforce the judgment in this country. It is apparent from documents placed before the court that enforcement proceedings are also being pursued in New York State.

On 13^th May 2009 Master Fontaine made the following Registration Order:

“The Judgment of the Court of Appeal of Piraeus of Judges Sarantis Drineas, Maria Galani-Leonardopoulou and Maria Vasdeki of 12 May 2008 in Decision Number 362/2008 between the Plaintiff Loucas Haji-Ioannis c/o Bird & Bird LLP, 15 Fetter Lane London EC4A 1JP and the Defendant Ioannis Frangos of Nyrnfwn 16, Kifissia, Attica Greece. (“the Judgment”) whereby it was adjudged inter alia that:

(a)

The Respondent is indebted to the Applicant in the sum of US$49,035,918.

(b)

The Respondent is indebted to the Applicant for legal interest on US$49,035,918 from 4 August 1994 to final settlement which totals as at 7 October 2008 US$57,617,884.70 and which continues to accrue pursuant to
Article 8 of the Greek Act of the Council of Ministers number 36/1990.

(c)

The Respondent do pay to the Applicant EUR€700,000 in respect of legal costs.

…be registered as a Judgment in the Queen's Bench Division of the High Court of Justice in England pursuant to Council Regulation (EC) 44/2001.’

The Regulation provides as follows:

Article 38

1.

A judgment given in a Member State and enforceable in that State shall be enforced in another Member State when, on the application of any interested party, it has been declared enforceable there.

2.

However, in the United Kingdom, such a judgment shall be enforced in England and Wales, in Scotland, or in Northern Ireland when, on the application of any interested party, it has been registered for enforcement in that part of the United Kingdom.

Article 42

2.

The declaration of enforceability shall be served on the party against whom enforcement is sought, accompanied by the judgment, if not already served on that party.

Article 48

1.

Where a foreign judgment has been given in respect of several matters and the declaration of enforceability cannot be given for all of them, the court or competent authority shall give it for one or more of them.

2.

An applicant may request a declaration of enforceability limited to parts of a judgment.’

Article 53

1.

A party seeking recognition or applying for a declaration of enforceability shall produce a copy of the judgment which satisfies the conditions necessary to establish its authenticity.

Applications for registration under the Regulation are made without notice. Hence this appeal was the first opportunity for arguments against registration to be advanced on behalf of Mr Frangos. The issues which arise on this appeal concern the consequences of the death of LH. He was born in Cyprus and had British nationality. The parties are agreed that in about 1990 he acquired a domicile of choice in Monaco. When he became ill towards the end of his life he went to live in Athens where he received medical treatment. It is contended on behalf of Mr Frangos that Greece then became the domicile of choice of LH. He died intestate in Athens leaving a widow and three children.

It was contended on behalf of Mr Frangos that the Applicants did not have an interest in the judgment satisfying the requirements of Article 38 for its registration. For the same reason it was contended that the Substitution Order should be set aside. Over the course of the hearing the arguments of the parties on the main issue, whether the Applicants had an interest in the judgment, have developed and changed in emphasis. On the day of the hearing Alexander Layton QC for Mr Frangos raised the issue of renvoi for the first time. The hearing was adjourned to allow the Applicants to consider the new point and for the parties to make submissions. Further, at a late stage, a question raised on behalf of Mr Frangos as to whether LH had made a will. On the basis of documents which had recently come to light he also questioned whether the Applicants had given up their interest in the judgment.

Subject to the question of whether the Applicants, with the exception of NH, had given up their rights to succeed to the Frangos claim, it was common ground that whether the Greek, Monegasque or English law of succession applied, the Applicants were the heirs of LH and would inherit the benefit of the Frangos judgment. By the time closing submissions had been reached Mr Layton helpfully made it clear that he was confining the area of disagreement, and subject to the question of whether the Applicants had given up their rights to succeed to the Frangos claim, to the time when the Applicants would succeed to the judgment. Under Monegasque law, subject to attestation which operates retrospectively, the property of an intestate vests in his close relatives on his death. Under Greek law heirs have four months if they are in Greece or twelve months if they are abroad to decline their inheritance. They succeed to the property when they accept their inheritance. Under English law those who are entitled to succeed to the property of an intestate do not enjoy possession in their own right until the estate of the deceased has been administered by the Public Trustee or representative in whom it vests on death.

In addition to the principle ground of appeal, Mr Layton raised a number of other grounds of challenge to the registration order. He contended that the application was made without full and frank disclosure. The material fact that LH had died was not communicated to Master Fontaine before or at the hearing. Further she was not told that the Supreme Court of Greece was considering an appeal by Mr Frangos. The Registration Order does not make it clear that the only part of the Greek judgment which is enforceable is that Mr Frangos pay €700,000 in respect of legal costs. The judgment is declaratory in respect of the principal of $49,000,000 and interest. Further Mr Layton complained that only a copy of the judgment was exhibited to the witness statement of Ms Eyre in support of the application whereas an original certified copy was required. It was contended that Mr Frangos had not been served with the Registration Order in accordance with the CPR. Further, the lawyer who supervised service had no authority to act on behalf of the Applicants. Late in the day Mr Layton questioned whether LH had in fact died intestate or whether there was a will. He also sought information as to whether the Applicants or any of them had surrendered their rights to inherit the Frangos claim.

Mr Layton on behalf of Mr Frangos questioned whether LH had in fact made a will. The basis for this was a photograph with caption in a book entitled ‘Loucas Haji-Ioannou, A King of Tankers A life-A fight’ second edition published in 2006. The photograph bears a caption which in translation reads:

“Loucas Haji-Ioannou with his children Polys, Clelia and Stelios draws up his testament.”

Mr Millett QC on behalf of the Applicants referred to the declaration made by the Honorary Consuls of Greece in Monaco before Nathalie Aureglia-Caruso Notary in Monaco on 18^th May 2009, the acte de notoriété. This included the statement in translation that no ‘provisions of last wishes are known’. The document refers to letters from two notaries in Monaco stating that they do not hold any last will of LH.

On 23^rd February 2009 PH, CH and NH gave powers of Attorney to Antonios Papadimitriou and others to deal with all matters relating to the Frangos claim. All three declared before a notary that LH had died without leaving a last will. On 27^th February SH also gave a power of attorney to Mr Papadimitriou and others to deal with the Frangos claim. This document was drawn up in Monaco and did not contain the statement that LH died without leaving a last will although it did contain an assertion that he is a lawful heir.

Following an Order made by me on 9^th July 2009, Mr Papadimitriou made a sworn statement on 30^th July 2009, his 5^th in this appeal. At paragraph 7 he stated:

“For the avoidance of any doubt, that as confirmed by all of the heirs of Loucas Haji-Ioannou, although he anticipated making a Will, no Will was ever published.”

In an Affirmation in Support of Motion for Substitution of Plaintiff made ‘under the penalties of perjury’ in proceedings to enforce the Frangos judgment before the Supreme Court of the State of New York County of New York Mr Resnik, a lawyer, referred to LH’s as ‘the estate of an intestate’.

On the evidence before me I am more than satisfied that LH died intestate. There was no evidence other than the caption on a photograph in a book suggesting that LH may have made a will.

During the course of the hearing the question was raised on behalf of Mr Frangos of whether PH, CH and SH had surrendered any rights to inherit the benefit of the judgment.

The Applicants and LH entered into a Distribution Agreement on 13^th February 1997. By clause 2 the children agreed that:

“…what each of them receives from the Father is in lieu of his or her share in the inheritance of the Father at the time of his demise.”

NH agreed to the distribution to the children having regard to obligations undertaken by them to her. By clause 13 LH retained the right to revoke the Distribution Agreement.

On 7^th March 1998 LH revoked the Distribution Agreement.

Mr Layton questioned whether the Distribution Agreement excluded the Frangos claim and whether there were any reservations to the revocation of the Distribution Agreement which affected the Applicants’ entitlement to inherit the benefit of the claim. There was no reference to the Frangos claim in an appropriately redacted copy of the Distribution Agreement.

Reliance was placed by Mr Layton on the second witness statement of Vasileios Katsouris of 8^th July 2009 in which he set out an extract of the evidence of SH in other proceedings in which he said:

“In 1997 my father because he was very close to dying determined what belongs to each of his children and demanded from Ioannis Frangos the return of the money which he has given to him. In 1998, when he recovered he got everything back and in 1999 he gave to us some (of those that (added) he has given in 1997).”

Following an Order of 8^th July 2009 that he serve a sworn statement setting out his personal knowledge of how, if at all, entitlement to the Frangos claim was dealt with by LH in the Distribution Agreement or thereafter, Mr Papadimitriou in his fifth sworn witness statement stated at paragraph 7:

“I also confirm for the avoidance of doubt that (a) LH did not distribute the Frangos claim to any of his heirs during his lifetime, (b) none of the heirs of LH have waived their claim to the inheritance of LH at the very least as far as the Frangos claim is concerned and (c) the instructions I received from LH and his heirs were at all times consistent with my statements under (a) and (b) above.”

PH made a statement on 30^th July 2009 in which he said that:

“3.

It is of course correct that my father made a Distribution Agreement in February 1997 which he revoked on 7 March 1998. Since the revocation of the Distribution Agreement in 1998, my father made various distributions to his Children including certain distributions in 1999. The substance of these distributions is confidential. I can confirm however that at no time prior to my father's death did he distribute or divest the Frangos Claim in any of his children or to my mother. I further confirm that,  insofar as my father made distributions to the respondents between February 1997 and his death on 17 December 2008, none of these distributions had any bearing on the Frangos Claim and none of the respondents were required — or did- give up their rights to inherit the Frangos Claim upon my father's death and for the avoidance of any doubt I confirm that at no stage between 1997 and the date of my father's death did any of the respondents waive or surrender in any way their rights to inherit the Frangos Claim upon my father's death.”

On 28^th August 2000 LH wrote to his children of the Frangos claim:

“…In the event I am unable to conduct the case or in the event of my death, it is my wish that all matters regarding this claim will be determined by my three children voting by majority in accordance with the following percentages: Polys 40%, Stelios 30% and Clelia 30%. Any lawyer or other person who will take any action in accordance with such instructions will be fully authorised to do so, without questioning in any way the instructions so given, including the matter of my eventual incapacity.”

On the evidence before me the children of LH had not surrendered their right to inherit the Frangos claim. NH was not to receive any property from LH under the Distribution Agreement and was not affected by its revocation.

It was common ground that under English conflict of laws rules, succession to moveables, wherever they are situated, is governed by the law of the deceased’s domicile. The law of domicile of the deceased will determine who the heirs are and their beneficial entitlement. It was also common ground that, subject to the question of whether the Applicants had given up their rights to succeed to the Frangos claim, whichever system of law was applied, whether Greek, Monegasque or English, on the intestacy of LH the Applicants were or would become entitled to the judgment, a moveable asset of the late LH. There was an issue between the parties as to when they had or would become so entitled.

Mr Layton contended that if Greek law of succession applied, the Applicants were not yet entitled to the benefit of the judgment. He advanced two routes to reach the same conclusion. Route A is that on the death of the person entitled to a Greek judgment it is Greek law which determines who is then to be entitled to it. Greek law regards the law of the intestate’s nationality, English domestic law, but not its conflicts rules as applicable. Under English domestic law, the Applicants are not entitled to the benefit of the judgment because the judgment does not vest in them on the death of LH. The estate of an intestate vests in the Public Trustee or in appointed representatives. Route B is that English conflicts rules provide for succession to moveables to be determined by the law of the domicile of the deceased at the date of his death. LH was domiciled in Greece. As in Route A, Greek law regards the law of the intestate’s nationality, English domestic law, but not its conflicts rules as applicable with the same consequence that the Applicants are not entitled to the benefit of the judgment. Route B engages consideration of renvoi. Mr Layton recognised that renvoi does not apply in every type of case. He contended that it does apply to the law of succession and which applied to the argument developed in Route B.

Mr Layton also contended that the situs of the moveable asset, which he suggested was the right to register and enforce the judgment, is in England. Alternatively if the moveable asset is the benefit of the judgment, it is in Greece. English law is applicable for the reasons and with the consequences set out under Route B. Whichever analysis is correct he submitted that the application of English law results in the judgment vesting in the Public Trustee or representatives if they are appointed. In any event the Applicants are not yet entitled to the judgment.

Mr Layton contended that the question of whether the Applicants had an interest in the judgment depended on whether they had succeeded to it by the date of the application. He submitted that because LH was domiciled in Greece the English courts would apply Greek law to the question of who was interested in the judgment on LH’s intestacy.

Under Section 28 of the Greek Code:

“Relations arising from inheritance shall be governed by the national law of the person succeeded to when he died.”

Under Section 32:

“In the applicable foreign law are not included the rules of private international law of the foreign state.”

LH had British nationality at the date of his death. There is no such thing as ‘British’ law, only English, Scots or Northern Irish law. It was the evidence both of Mr Frangos’ Greek lawyer, Mr Katsouris and of his expert on Greek law, Professor Pamboukis that the Greek courts would apply English law on the basis that this was the system of law with which LH was most closely connected. Mr Millett did not seriously suggest that in context reference to the law of LH’s nationality should be anything other than to English law.

Mr Layton submitted that on renvoi under Greek law of intestacy, an English court applying English domestic law would disregard the location of the moveable asset in question, and would treat it in the same way as it would treat an asset within England. In his revised skeleton argument at paragraph 44 he observed:

“After all, Greek law is not actually appointing the administrator, it is merely concerned to know what the English law governing the devolution of assets is.”

Mr Layton also argued that in any event the moveable asset is the right to register the judgment and is located in England.

At paragraphs 39 and 40 of his revised skeleton Mr Layton sets out principles of English law of intestate succession upon which he relies.

“English law of intestate succession

39.

Under English law, the property of an intestate vests in the Public Trustee until letters of administration are issued: Administration of Estates Act 1925, section 9:

9.— Vesting of estate inPublic Trustee where intestacy or lack of executor.

(1)

Where a person dies intestate, his real and personal estate shall vest in the Public Trustee until the grant of administration.

…

(3)

The vesting of real or personal estate in the Public Trustee by virtue of this section does not confer on him any beneficial interest in, or impose on him any duty, obligation or liability in respect of the property.

40.

In other words, whoever may become entitled on an intestacy, unless and until letters of administration are taken out, it is only the Public Trustee who can give a good receipt for any payments due to the estate. No letters of administration have been taken out.”

Mr Layton contended that because the LH’s estate has not been administered the Applicants have no interest entitling them to register the judgment.

Mr Millett contended that the question raised by this appeal is in whom does the moveable property of LH vest for the purposes of the administration. Does it vest in the heirs or does it vest in the Public Trustee pending the appointment of an administrator? If the judgment has vested in the Applicants they have the requisite interest to register the judgment. He submitted that the appeal engaged the law of administration of estates and not of succession. Even if renvoi applies to the law of succession it does not apply to administration of estates. Renvoi is only relevant to a consideration of the Applicants’ entitlement to succession based on domicile. This turned on whether LH was domiciled in Greece or in Monaco at the date of his death.

Mr Millett pointed out that at an earlier stage of this appeal Mr Frangos had asserted that ‘there was no estate’ under Greek and Monegasque laws of intestacy ‘unlike English law’.

It was submitted on behalf of the Applicants that the law of succession is not engaged at all on this appeal. The Applicants’ Skeleton Argument on the new renvoi point states:

“Administration and Succession

11.

The next hurdle for Mr Frangos is whether the law of succession is engaged at all. It is not. English law draws a clear distinction between administration and succession. See Williams, Mortimer and Sunnucks on Executors, Administrators and Probate, at 1-18 to 1-21.

11.1.

The law of administration is concerned with, amongst other things, "grants of representation, the collection of the deceased's assets, and the payment of his liabilities". See paragraph 1-20.

11.2.

"The law of succession, by contrast, concerns the beneficial entitlement to the deceased's estate after discharge of liabilities upon it". See paragraph 1-21.

12.

On this appeal, the Court is not concerned with any issue of succession. Whether under Monegasque_, Greek or English law, the heirs are the same: namely the wife and three children. (The proportions in which they inherit are completely irrelevant as are any private arrangements between them). The question is, who is entitled to administer the estate or, more pertinently, in whom does the moveable property of LH Haji-Ioannou vest for the purposes of the administration? Does it vest in the heirs, or does it vest in the Public Trustee pending appointment of an administrator?”

Mr Millett accepted that ‘there is some material to support an argument that renvoi applies in the field of succession’ but stated that there is no authority to suggest that it should be applied to the law of administration.

If it was necessary to give them standing as representatives of an estate of LH I was invited by Mr Millett to make a representation order under CPR 19.8(1)(b) naming the Applicants.

Whilst the parties are agreed that the Applicants have or will succeed to the judgment whichever of the possible laws of intestacy are applied, nonetheless the question of which applies is material to the determination of when that succession takes place.

At the outset of the hearing Mr Layton relied on evidence of Greek law of succession to show that heirs have four months if they are in Greece and one year if they are abroad to disavow their inheritance. Accordingly he submitted that it cannot be said that the Applicants succeeded to the judgment under Greek law until that time had elapsed or they had accepted their inheritance. If Monegasque law applied the Applicants did not succeed to the judgment until the acte de notoriété had been issued. From the statement of Richard Mullot and the second stamp on the document this was on 18^th May 2009 which was after the Registration Order was made. If English law applied the Applicants did not acquire entitlement to the judgment until the estate of LH had been administered.

The parties are agreed that the right of succession to the judgment is determined according to the law of the deceased’s domicile. LH’s domicile is to be determined in accordance with English law. The principles of the English law of domicile are not in dispute. They are set out in chapter 6 of Dicey, Morris and Collinson The Conflict of Laws (2006) and were recently reviewed by the Court of Appeal in Barlow Clowes v Henwood [2008] EWCA Civ 577. Lady Justice Arden summarised these at paragraph 8.

“8.

The following principles of law, which are derived from Dicey, Morris and Collins on The Conflict of Laws (2006) are not in issue:

(i)

A person is, in general, domiciled in the country in which he is considered by English law to have his permanent home. A person may sometimes be domiciled in a country although he does not have his permanent home in it (Dicey, pages 122 to 126).

(ii)

No person can be without a domicile (Dicey, page 126).

(iii)

No person can at the same time for the same purpose have more than one domicile (Dicey, pages 126 to128).

(iv)

An existing domicile is presumed to continue until it is proved that a new domicile has been acquired (Dicey, pages 128 to 129).

(v)

Every person receives at birth a domicile of origin (Dicey, pages 130 to 133).

(vi)

Every independent person can acquire a domicile of choice by the combination of residence and an intention of permanent or indefinite residence, but not otherwise (Dicey, pages 133 to 138).

(vii)

Any circumstance that is evidence of a person's residence, or of his intention to reside permanently or indefinitely in a country, must be considered in determining whether he has acquired a domicile of choice (Dicey, pages 138 to 143).

(viii)

In determining whether a person intends to reside permanently or indefinitely, the court may have regard to the motive for which residence was taken up, the fact that residence was not freely chosen, and the fact that residence was precarious (Dicey, pages 144 to 151).

(ix)

A person abandons a domicile of choice in a country by ceasing to reside there and by ceasing to intend to reside there permanently, or indefinitely, and not otherwise (Dicey, pages 151 to 153).

(x)

When a domicile of choice is abandoned, a new domicile of choice may be acquired, but, if it is not acquired, the domicile of origin revives (Dicey, pages 151 to 153).’

Although lengthy uninterrupted residence may provide some evidence of the intentions of an individual as to domicile this will only be the case where the residence is freely chosen and not for some limited purpose. In Udney v Udney [1869] LR 1 Sc & Div 441 Lord Westbury held at page 458:

“There must be a residence freely chosen and not prescribed or dictated by any external necessity, such as the duties of office, the demands of creditors, or the relief from illness; and it must be residence fixed not for a limited period or particular purpose, but general and indefinite in its future contemplation.”

Lady Justice Arden in Barlow Clowes held at paragraph 14:

“Given that a person can only have one domicile at any one time for the same purpose, he must, in my judgment have a singular and distinctive relationship with the country of supposed domicile of choice. That means it must be his ultimate home or, as it has been put, the place where he would wish to spend his last days.”

The parties do not suggest that LH had any other domicile of origin than that of Cyprus where he was born. They are also in agreement that he acquired a domicile of choice in Monaco in about 1990 as is set out in Mr Frangos’ Chronology. The issue between the parties is whether LH abandoned Monaco and acquired Greece as his domicile of choice before he died.

The court in ascertaining whether an applicant has an interest in a judgment registrable in accordance with Article 38 is not determining issues of succession or administration. Article 1.2(b) provides that the Regulation does not apply to succession. The evidence on domicile advanced before me was not as detailed as may be expected in proceedings in which it is directly in issue.

The following evidence on domicile is material to the decision as to where LH was domiciled at the time of his death.

LH maintained substantial residences both in Monaco and in Athens. He maintained staff in his Monaco residence all the time he was staying in Athens.

LH was described in all court documents as domiciled in Monaco: the proceedings in the Athens Court of Appeal, the Supreme Court of Greece and in proceedings before the New York Court. Where there is reference to domicile in any document LH is described as being domiciled in Monaco. The only document which is relied upon by Mr Frangos as evidence that LH was domiciled in Greece is the death certificate. This states in translation that his ‘domicile’ was ‘P. Psichiko, Kalvou 55’.

Mr Papadimitriou who had been the lawyer of LH for the purposes of the Frangos claim made statements for the purpose of these proceedings which asserted that his domicile was in Monaco.

Mr Panayotis Touliatos, the Greek Consul General in Monaco deposed to the fact that LH renewed his Carte de Sejour which was current at the date of his death. This can only be done for someone who resides in Monte Carlo. He also commented that he had never known of anyone who voluntarily gave up their Monegasque domicile as it conferred considerable tax advantages.

PH exhibited to his statement of 1^st July 2009 copy cards which showed that his father retained membership of the Yacht Club and the Automobile Club of Monaco. He appears to have retained the title of Consul General of Cyprus in Monaco until his death.

PH challenged the statement of Mr Frangos that his mother NH greatly disliked Monaco and hardly ever went there.

LH was seriously ill for a long period of time before his death. He considered that it would be medically preferable to be treated in Athens rather than in Monte Carlo. Also it was better for him to be able to communicate with medical staff in Greek. The preamble to the Distribution Agreement shows that as early as 1997 LH was in bad health. He spent the last ten years of his life in Athens.

LH’s business had offices in Monte Carlo and Athens as well as elsewhere.

In my judgment the evidence establishes that LH went to live in Athens for medical treatment. This was not a case of someone going to live in a country because the air and general living conditions are better there. When LH went to live in Athens he was already seriously ill. There is no evidence that but for his wish to receive medical treatment in Athens he would have ceased to live in Monaco. If he had recovered no doubt he would have returned to Monaco. However, sadly, there is no evidence that recovery was likely. The revised skeleton argument on behalf of Mr Frangos states in paragraph 58 that it is common ground that:

“(3)

LH intended to live in Athens during any period in which he required medical assistance;

(4)

LH did not intend to return to Monaco unless and until he became well again:

(5)

LH was very seriously ill for a long time and would have required very regular, if not continuous, medical care.”

The entry on the death certificate is not of assistance in determining the domicile of LH. It was completed by someone without knowledge of LH’s history or circumstances. Further the fact that an address and not a country is described as ‘domicile’ in my judgment refers to the house where the deceased was then living rather than of domicile in a particular country.

The evidence before me does not establish on a balance of probabilities that LH abandoned his agreed domicile of choice and acquired a domicile of choice in Greece. Accordingly at the date of his death LH was domiciled in Monaco.

Monegasque conflicts laws apply the law of the deceased’s nationality to questions of succession. Where, as here, the law of the deceased’s nationality refers back to his law of domicile, in this case Monegesque law of succession will apply.

If the Applicants succeeded to the Frangos judgment there was an issue between the parties as to when they did so. Mr Millett rightly agreed that it was for the Applicants to establish that on 13^th January 2009 they had the necessary interest in the judgment to give them standing to obtain the Registration Order. Whilst he accepted that the Applicants bore the legal burden to establish the necessary interest, he contended that the approach of Mr Frangos to Monegasque law on this issue should be taken into account in viewing the evidence. The matters upon which he placed reliance in this regard are the absence in paragraph 44 of the skeleton argument of 16^th June 2009 on behalf of Mr Frangos of a distinction between acquiring the status of heirs and the acquisition by those heirs of an interest in an estate. He also relied on the statement in paragraph 61 of the skeleton argument on behalf of Mr Frangos of 6^th July 2009 that if LH was domiciled in Monaco the Applicants would have stepped into his shoes at the date of his death. He viewed this as a concession.

Mr Millett contended that there are three reasons why the Applicants had by 13^th January 2009 a sufficient interest in the Frangos judgment to establish an entitlement to a Registration Order. First, the acquisition by the Applicants of the status of heir on the death of LH on 17^th December 2008 was sufficient to establish their interest in the Frangos judgment for the purpose of Article 38. Secondly, the Applicants had taken steps to recover the sum due under the judgment which established that they had accepted their inheritance before 13^th January 2009. Thirdly, under Monegasque law, acceptance of inheritance has retrospective effect and is backdated to the date of death so that title to the judgment was acquired on that date. Accordingly it is immaterial if acceptance of the inheritance was after the date of the Registration Order.

Mr Layton acknowledged that the challenge on behalf of Mr Frangos to the entitlement of the Applicants to the judgment was expressed in paragraph 44 of the skeleton argument of 16^th June 2009 in terms of when they acquired the status of heirs. He asserted that the acceptance in paragraph 61 of the skeleton argument of 6^th July 2009 that the Applicants stepped into the shoes of LH on his death was not a concession that they had an interest in the judgment from that date. He contended that the date on which they became so entitled was the date on which they accepted their inheritance, 18^th May 2009. Mr Layton contended that the documents relied upon by the Applicants to establish that the Applicants accepted their inheritance before 13^th January 2009 do not have that effect. As for Mr Millett’s argument on retrospectivity, Mr Layton contended that the Applicants had to establish that they had the required interest in the judgment when the Registration Order was granted, 13^th January 2009. The fact that acceptance of the inheritance has retrospective effect to the date of death, 17^th December 2008, does not assist.

Evidence of the Monegasque law of succession was given on behalf of Mr Frangos in two statements by his solicitor John Hicks. In his statement of 4^th June 2009 Mr Hicks says:

“2.

In paragraph 14 of my first witness statement, I referred to the advice I had received from Mr Mark Lusher of Groom Hill Law Offices in Monaco concerning Monegasque law of inheritance, to the effect that Monegasque law did not have an exact equivalent to the English concept of an estate, and that it provides on an intestacy for the division of the deceased’s rights and property between his widow and children once their status as heirs is established.

3.

…Mr Simon Groom of the same law offices …informs me that Monegasque conflicts of law rules provide that the applicable law governing the devolution of the rights and other moveable property of a deceased person is the law of the deceased’s nationality.”

On behalf of the Applicants, Richard Mullot, a qualified Monaco lawyer made a statement on 2^nd July 2009. He referred to information that the Applicants had been designated the legal heirs of LH in a document issued by a Monaco notary on 18^th May 2009, the ‘acte de notoriété’. As he explained, the heirs become heirs automatically and immediately upon the death. They will be regarded as having accepted their inheritance by notarised act, or informally by other actions. The acceptance is deemed effective as of the date of death.

Mr Mullot states:

“4.

I am further informed that this situation is being challenged on the basis that under Monaco law, the heirs only obtained their status of heirs on 18 May 2009 and not at the date of the death. Such analysis is wrong. The status/quality of heir (qualité d'héritier) is permanent and the rights attached to this quality (droits d'héritiers) is granted, automatically and immediately upon the death of the father/husband, to his widow and children. The heirs become heirs automatically and immediately upon the death. The acceptance of the estate can be expressed - in a formal document signed in front of a Public Notary or in private - or silent - when the heirs signs as such an heirand could not have done so if he wasnot accepting his inheritance rights (article 659 of the Civil Code). If an heir takes steps upon the death of the deceased such as to instruct lawyers to recover assets of the deceased, the heir is deemed to have accepted his inheritance rights.

…

Therefore, once accepted, the legal effects of the acceptation goes back to the date of the death (article 658 of the Civil Code)

…

Law applicable at time of death

8.

Under the laws of Monaco , the question as to what is the law applicable to the estate of a deceased who was domiciled in Monaco is governed by Article 83 of the Civil Code which is set out below.

…

9.

The Estate of a deceased domiciled in Monaco but who is a national of another country, will be opened in Monaco and the estate vests immediately on death to the heirs in accordance with Articles 83 and 602. However, under the Monaco conflict of Law rules, the succession to movables of the estate is governed by the law of the nationality of the deceased. The national law of the deceased will determine the identity of the heirs and the proportions they inherit.

10.

However, where conflict rules of the national law provide for the law of the domicile to govern succession of movables, Monegasque law will be applied.”

I accept the evidence of Richard Mullot as to Monegasque law. Accordingly in accordance with the applicable law, the Applicants acquired qualité d’héritier, the status or quality of heirs, on 17^th December 2008, the date of LH’s death. Mr Millett rightly agreed that my decision on the effect of Monegasque law is not affected by statements in paragraph 44 and 61 of two skeleton arguments on behalf of Mr Frangos. However I accept that I can have regard to the approach taken in those passages in assessing the other evidence on the issue of when the Applicants accepted their inheritance and acquired the necessary interest in the Frangos judgment.

No authority was shown to me to support the proposition that the acquisition of the status as heir without accepting the associated inheritance constituted the interest required by Article 38 to register a judgment. In my judgment the evidence of Monegasque law is to the effect that obtaining the status of heir and acceptance of inheritance rights are two separate and distinct steps. An heir may not accept his inheritance rights. Regarding such a person as having an interest in property, a judgment, which he has not and may never accept, would not, in my judgment, be consistent with the registration and enforcement scheme of the Regulation. The property of a deceased, a judgment, which an heir does not accept may well devolve on another person. It would be curious if the heir who has declined the inheritance as well as the individual who has acquired legal title to it could register the judgment for enforcement. In my judgment the Applicants have not established that the acquisition by them of the status of heirs in itself conferred the interest in the Frangos judgment required for its registration in accordance with Article 38.

Even if steps taken by an heir to recover only part of his inheritance are to be deemed to be acceptance of his inheritance rights, in my judgment the documents relied upon by the Applicants do not establish that before 13^th January 2009 they had taken steps as heirs to recover the Frangos judgment. The Registration Order was not made in their name. Although their solicitors wrote on 16^th April 2009 that since LH’s death they had acted for his heirs in his place, it was not until 12^th May 2009 that the Applicants gave their solicitors written consent to be substituted for their late father in the English registration proceedings. As Mr Layton pointed out, the solicitors’ letter of 16^th April 2009 does not state when they were instructed by the Applicants to register the Frangos judgment for their benefit. It is to be noted that the solicitors did not inform the Master on or before 13^th January 2009 that registration was now being sought by the heirs following the death of LH. Further, the acte de notoriété of 18^th May 2009 does not refer to an earlier acceptance of the inheritance. Even if the powers of attorney given to Mr Papadimitriou and others by the Applicants on and after 23^rd February 2009 in respect of property of LH were capable of constituting acceptance of their inheritance by the Applicants, these were not granted until after 13^th January 2009. Accordingly they do not assist in establishing that the Applicants had accepted their inheritance by the date of the making of the Registration Order.

By reason of Article 658 of the Monegasque Civil Code, acceptance of inheritance is deemed effective as of the date of death. However, Mr Mullot’s evidence does not support the proposition that the deeming provision of Article 658 retrospectively validates a Registration Order made pursuant to Article 38. This can only be granted to a party who has an interest in the judgment at the time of the making of the Order for Registration. On the evidence, the Applicants could not demonstrate that they had an interest in the Frangos judgment until 18^th May 2009.

I am not satisfied on the evidence before me, including that of Me Mullot, that the Applicants acquired an interest in the Frangos judgment for the purposes of Article 38 on or before 13^th January 2009. They acquired such an interest when they formally accepted their inheritance rights by the acte de notoriété of 18^th May 2009. This declared the applicable law and the proportions of ‘toute propriété de la succession mobilière de’ LH of each of the Applicants.

Mr Layton contended that because in English law the estate of an intestate vests in the Public Trustee or representatives until administration is complete the Applicants have not acquired an interest in the judgment.

Succession to moveables is governed by the law of the nationality of the deceased. Monegasque law applies renvoi. LH was of British nationality. It was not seriously in dispute between the parties that the law of LH’s nationality leads to the application of English law. Under English law the domicile of the deceased governs succession to moveables.

Mr Layton contended that the application of the Greek Civil Code would result in disregarding the location of the movable asset and its treatment as an asset within England. It would be regarded as forming the estate of LH. Accordingly it would not vest in the Applicants until the estate of LH had been administered. In the absence of authority supporting this argument, in my judgment there would be no warrant for treating the judgment as being within England. In any event this argument fails in light of my judgment that LH was not domiciled in Greece at the time of his death.

I do not accept the further argument advanced by Mr Layton that the moveable asset was the right to have the judgment registered in England and that this is located in England. As Mr Millett points out in his skeleton, it would mean that anyone who died with the benefit of an unsatisfied Community judgment had property in every EU jurisdiction. In accordance with English law, it is only property situated in England which automatically vests in the personal representative. Moveables out of the jurisdiction only vest in the representative if they are brought into England:

“any moveables of the deceased which after his death are brought into England before any person has, in a foreign country in which they are situate, obtained a good title thereto under the law of such foreign country (lex situs) and (semble) reduced them into possession.” (Dicey Rule 132 (2) 26R-021).

If there is no property of the deceased in England and he died domiciled abroad, the court is very reluctant to make a grant. (Dicey 26-004). Moveable property of the deceased located abroad will not vest in an English administrator or personal representative and in any event will not do so if a person has already obtained good title to it.

In my judgment the case of Vanquelin v Bouard 15 CB (NS) 841 (19.11.1863), relied upon by Mr Millett, illustrates the difference between administration and succession in the context of a deceased domiciled and with moveable assets abroad. It also provides an apposite example of how the courts in England will permit a party who has an absolute entitlement to a deceased’s property in accordance with the law of their domicile to enforce in this country that party’s claim in a personal and not representative capacity.

In Vanquelin a debtor objected that a widow who had inherited a claim on the death of her husband could not sue him in England in her personal capacity but only as a representative after obtaining letters of administration. The plaintiff sought to claim on bills of exchange under which the defendant was liable to the deceased. Erle CJ recorded at page 826 that:

“his widow, now the plaintiff, in accordance with the laws of France, became the donee of the universality of the real and personal estates belonging to the succession of the deceased at his death; and she alleges that thereby and according to the laws of France all rights, claims, and causes of action, and all liabilities and obligations of the deceased vested in her personally and absolutely, and she became, according to the said laws, liable personally upon the said judgment, and also entitled personally and in her own name to sue for and enforce all the rights and claims of the deceased…”

This proposition was not doubted.

Erle CJ held at page 827:

“But the law of domicile attaches to these parties; and there is a distinct averment that the plaintiff was, according to the laws of France, ‘the donee of the universality of the personal and real estates belonging to the succession of the deceased …. And is entitled to demand and sue for the same in her own name and in her own right ...’. I think it sufficiently appears upon this record that the plaintiff was entitled to sue upon these bills in her own right; the fact of her being the donee of the universality of the personal and real estates belonging to the succession of her deceased husband giving her by the law of France rights different from those which an executor or an administrator has in this country.”

Keating J stated that the rule which governs the mode of enforcing personal rights or claims to property of deceased persons is well established. However:

“… the second count does sufficiently shew upon the face of it that, according to the law of France, the plaintiff was entitled (in France) to this succession, and to sue in respect of it in her own name and in her own right.”

Williams J, whilst feeling some difficulty, concurred with Earl CJ and Keating J.

In Vanquelin the widow succeeded to her late husband’s property in accordance with French law. According to French law she had acquired the beneficial interest in her late husband’s claim before she sought to enforce it in England. She was held entitled to do so in her own right.

Applying these principles, in my judgment the Applicants acquired an interest in the judgment on 18^th May 2009. From that date they were entitled to apply to have it registered under Article 38.

Mr Layton contended that the judgment is not enforceable in Greece in respect of either the principal sum or the interest elements. It ought not to have been registered for enforcement in respect of those sums, even by way of provisional or security measures.

Mr Millett submitted that the application was for registration of the Greek judgment. LH and the Applicants were not seeking immediate enforcement. Reference was made to awaiting the outcome of the judgment of the Supreme Court in Greece. Further it was said that it is clear from the Order that all concerned understood that the judgment was declaratory so far as liability for the principal and interest were concerned but ordered payment of costs in the sum of €700,000.

Registration of a judgment under Article 38 is the precursor to enforcement. Article 38.2 refers to a judgment ‘registered for enforcement’. Article 48 provides that:

“1.

Where a foreign judgment has been given in respect of several matters and the declaration of enforceability cannot be given for all of them, the court or competent authority shall give it for one or more of them.”

2.

An applicant may request a declaration of enforceability limited to parts of a judgment.”

The Applicants’ skeleton argument recognises the distinction between the declaratory part of the judgment and that which orders payment of costs. Mr Millett contended that ‘The Claimants are still entitled to have the Greek judgment registered’. (Para 12)

It is only judgments or parts of judgments which have been declared enforceable in the Member State in which the judgment was given which can be registered. In my judgment it is only the part of the judgment ordering Mr Frangos to pay costs of €700,000 which can be registered under Article 38. The other parts of the judgment against Mr Frangos are declaratory only. The declarations may be used in further proceedings to obtain judgment for sums of money but they are not enforceable.

Mr Layton contended that the Registration Order of 13^th January 2009 should be set aside in any event because the Applicants had failed to make full and frank disclosure for the purposes of an application on which Mr Frangos was not entitled to make representations. They had failed to inform the Master that the original Applicant, LH, had died.

Mr Layton drew attention to Bowler v John Mowlem & Co Ltd [1954] 1 WLR 1445 in which the plaintiff was described in a writ as administratrix in an action under the Fatal Accidents Acts. Lord Denning held at page 1446:

“… if a plaintiff brings an action in a representative capacity as administratrix, then that action is a nullity if she was not at that date by law administratrix with a proper grant. Even if she obtains a grant within a week, a month or a year afterwards it does not relate back. The writ is a nullity from the beginning.”

The Substitution Order was also made without notice. A number of criticisms were made about the failure of the Applicants to notify the Master of certain matters. Perhaps most importantly there was a failure to inform her that an appeal against the Registration Order had been lodged and the interest of the Applicants in the judgment entitling them to register it was being challenged.

Mr Millett pointed out that the application for registration was made on 15^th December 2008 when LH was still alive. He recognised that it

“…might in the ordinary course be neater to obtain an order for substitution prior to the making of an order such as that made by Master Fontaine on 13 January 2009.”

However in this case because the application was dealt with on paper he suggested that ‘there was no obvious point at which to raise substitution.’ In any event he contended that the fact that Master was not notified of the death of LH and the Applicants substituted for LH before the Registration Order was made was a technical defect and at most an irregularity. He relied on dicta of Lord Bingham in Fielding v Rigby [1993] 1 WLR 1355 including the following at page 1360:

“The defect which did take place was that, at the date of service, the name of the action had not been amended so as to show the plaintiff as the party upon whom the right of action of the deceased had devolved.

That, as it seems to me, is an irregularity which is well within the powers of the court to make good under RSC Ord 2 r 1(2). In other words there was, I think, a departure from the correct procedure in this case, but not one which went to the root of the proceedings so as to render them a nullity.”

Fielding was a case in which the cause of action originally vested in the deceased and ‘there has never been a stage at which the cause of action has not been vested in a living and existing party.’(p1360). That is not so in this case. Until the Applicants had accepted their inheritance by the acte de notoriété they could not claim that the right to the judgment was vested in them. In my judgment the entitlement of the Applicants to the judgment in the period from the death of LH to 18^th May 2009 was more uncertain than that of the plaintiff in John Mowlem. Until 18^th May 2009 it was possible albeit unlikely that they would disavow their inheritance. In that intervening period they did not have the right to register the judgment. Neither they nor anyone else had the right to register the Frangos judgment in the period from 17^th December 2008 to 18^th May 2009. Applying John Mowlem, the Registration Order of 13^th January 2009 granted by Master Fontaine at the suit of the Applicants was a nullity and is to be set aside.

If I had not reached the conclusion that it was a nullity, I would have set the Registration Order aside on grounds of material non disclosure. Master Fontaine was not informed that the person entitled to register the judgment had died. What would no doubt have appeared to her to be simple matter of ensuring that all the documentation was in order would have been different if she had been informed that LH had died. As this appeal has demonstrated, the question of whether and when the Applicants became entitled to the judgment is far from straightforward. The death of LH would have required the Applicants to satisfy the Master that they had the interest in the judgment required by Article 38 at the time she was determining the application.

There was also non disclosure in applying for the Substitution Order in that the Master was not informed that the Registration Order was being appealed by Mr Frangos. The other grounds relied upon to set aside the Substitution Order are, in effect, a repetition of the arguments advanced on behalf of Mr Frangos in support of the contention that the Applicants have not acquired a registrable interest in the judgment. I have held that since 18^th May 2009 they have had such an interest. Whilst the non disclosure of the fact that an appeal against the Registration Order was being pursued which challenged the standing of the Applicants to register the judgment is serious, in all the circumstances I do not set aside the Substitution Order.

Since 18^th May 2009 the Applicants have been entitled to stand in the shoes of the late LH to seek registration of the enforceable part of the judgment, that for €700,000 costs. The Registration Order is set aside. However the Substitution Order remains in place.

For reasons which have become apparent I will deal with the further points shortly.

Mr Layton contended that the application for registration was defective because it attached a copy of the judgment. For the reasons set out in the Applicants’ skeleton argument of 6^th July 2009 at paragraph 27 to 30 in my judgment this was not a material error.

Since the Registration Order has been set aside the question of whether it was duly served has become academic.

The appeal of Mr Frangos against the Registration Order is allowed. His appeal against the Substitution Order is dismissed.

I would like to thank both counsel for their erudite submissions.