#5074 - Government Of Usa V. Montgomery - Conflict of Laws BCL

Government of USA v. Montgomery

Facts

The defendant's former husband Larry Barnette was charged with defrauding the United States Government of sums of money totalling some $15m, and was convicted in 1984 on a number of counts of fraud and related offences, including offences under the Racketeer Influenced and Corrupt Organisations Act (“RICO”). He was sentenced to a term of imprisonment and also ordered to pay $7m to the United States by way of restitution and to forfeit his 900 shares in Old Dominion SA. Shortly before he was indicted for fraud, Mr Barnette transferred 800 of his 900 shares in ODSA to the defendant, who was at that time still married to him. The US court ruled that under RICO the US Government's title to the 800 shares antedated the transfer to the defendant, with the consequence that they were forfeited and had to be surrendered.

After lengthy and complex litigation the US district court made an order on 18 August 1995, whereby it held both the defendant and Mr Barnette in contempt and ordered them to pay by way of forfeiture the sum of $4,217,833.01. In August 1983 the defendant left Mr Barnette and subsequently remarried, being now Mrs Montgomery. She renounced her US citizenship in April 1992 and moved to London in May 1992, with the intention of taking up residence there. She became a citizen of St Kitts and Nevis in June 1994 and lost her US nationality in November 1994. On 15 December 1992, when she was out of the jurisdiction, the US court made an order for discovery against her, but she failed to comply with it.

She did, however, take part in the proceedings to the extent that she supported an application by Mr Barnette claiming credit for certain sums and a motion by him seeking further time to respond to the US Government's motion.

The defendant filed a substantial brief and was represented by counsel. At the end of the hearing the court invited further submissions on the issue whether in view of the “fugitive status” of the defendant and Mr Barnette it should not entertain their appeal at all. The defendant submitted a brief on this issue, but the court on 20 November 1997 dismissed both appeals on the basis of the fugitive disentitlement doctrine. Under this doctrine the court had a discretion to refuse to hear or decide the appeal, on the ground that the defendant was a fugitive from justice.

Holding

Foreign cases and domestic cases

In doing so I would observe that in my judgment the case belongs to the category classified by Lord Bingham of Cornhill in R (Ullah) v Special Adjudicator [2004] 3 WLR 23 as “foreign cases” rather than “domestic cases”. In the latter category, exemplified by Abdulaziz, Cabales and Balkandali v United Kingdom (1985) 7 EHRR 471 and Bensaid v United Kingdom (2001) 33 EHRR 205, the treatment by a state within its jurisdiction of a person resident there is such that that treatment may constitute a breach of one of the articles of the Convention. Conversely, in a “foreign” case, such as those concerning the expulsion of aliens seeking entry, the complaint is that the act or omission of the state may expose the applicant to treatment in another state which, if committed by a Convention state would constitute a breach of one or more of the provisions of the Convention.

No Direct breach of the Convention

“Article 1 of the Convention, which provides that ‘the high contracting parties shall secure to everyone within their jurisdiction the rights and freedoms defined in Section 1,’ sets a limit, notably territorial, on the reach of the Convention. In particular, the engagement undertaken by a contracting state is confined to ‘securing’ (‘reconnaitre’ in the French text) the listed rights and freedoms to persons within its own ‘jurisdiction’. Further, the Convention does not govern the actions of states not parties to it, nor does it purport to be a means of requiring the contracting states to impose Convention standards on other states.”

Given this territorial limitation, it is difficult to see how registration of the US court's order could constitute a direct breach of its terms, for there can be no suggestion that the hearing afforded to the defendant in the registration proceedings failed to meet any of the requirements of the article.

Pelligrini was based on the special relationship between Italy and Vatican

Pellegrini's case turns on the relationship between the Italian civil courts and the Ecclesiastical Court of the Rome Vicariat, a church court classed by the European Court as a court of the Vatican (properly the Holy See), a state which is not a party to the Convention. The relationship between the Italian courts and the Vatican courts depends, however, on the terms of the Concordat, a special legal relationship between states. Article 8(2) of the Concordat provides, in an English translation, so far as material:

“The judgments of nullity of marriage pronounced by ecclesiastical tribunals, together with the decree of execution issued by the superior controlling ecclesiastical authority, shall be declared, at the request of the parties or of one of them, effective within the Italian Republic by judgment of the competent Court of Appeal, upon verifying”

The Italian courts were accordingly specifically obliged to ensure that the procedure was sufficient to satisfy the terms of article 6 of the Convention, as well as article 111 of the Italian Constitution. The decision in Pellegrini is therefore in my opinion dependent on the particular effect of the Concordat, and is not authority for the conclusion which the defendant's counsel sought to draw from it. I therefore do not consider that the defendant's argument based on direct engagement of article 6 is well founded.

Indirect Application of Art. 6

The court in Soering concluded accordingly that a risk that the applicant might be subjected to torture, inhuman or degrading treatment or punishment was sufficient to engage the responsibility of a contracting state under article 3 when considering extradition. The court held:

“The right to a fair trial in criminal proceedings, as embodied in article 6, holds a prominent place in a democratic society. The court does not exclude that an issue might exceptionally be raised under article 6 by an extradition decision in circumstances where the fugitive has suffered or risks suffering a flagrant denial of a fair trial in the requesting country. However, the facts of the preset case do not disclose such a risk.”

The European Court has affirmed on a number of occasions the...