BANK VOOR HANDEL EN SCHEEPVART NV

V. SLATFORD: [1953] 1 QB 248

Facts:
1. A quantity of gold was deposited in London by a Dutch
bank before the start of the 1939-1945. When in may 1940,
the Netherlands were invaded; they became an enemy
territory for the purposes of the 1939 Act.
2. With the approval of UK government, Netherland
Government exercised their powers from London and in
May 1940, they issued a decree which purported to have
the effect of transferring property and gold.
3. The board of trade made an order in July 1940, transferring
the gold to the custodian of Enemy property which was
sold for 20, 00,000 pound or £2 million.
4. An order was made by the Netherlands govt. in May 1950
for returning the gold to bank. The bank made a claim
against the custodian in conversion for the present value of
gold.

Held:
It was held that it is convenient to begin by considering what is
the general principle of our law with regard to foreign legislation
affecting property within our territory. With a little doubt of, lex
situs which is a general rule that governs the transfer of
movables when effected contractually, and mobilia sequuntur
personam is exception rather than rule, and is confined to
special cases of general assignments.
Upon this basis, not being a part of English law it would not
transfer the property in case. But decrees of this character have
received in authorities rather different treatment. The
effectiveness of such decrees does not appear on the authorities
to be determined exclusively by application of lex situs.
Sometimes decree is confiscatory and sometimes as a matter of
public international law no state ought to seek to exercise
sovereignty over property outside its own territory, and
sometimes it is against enforcement, since no state can expect to
make its laws effective in the territory of another state.
A states authority, in the eyes of other states and the courts that
represent them, is speaking very generally, coincident with, and
limited by its power. It may legislate for, and give judgments
affecting, things and persons within its territory. It has no
authority to legislate for, or adjudicate upon, thing or persons
not within its territory.