Act of State and Statutory Immunity

In one line

An act of State is an act of sovereign power done against a foreigner which no court will examine, and statutory immunity is the protection a particular Act gives to officers acting in good faith under it.

In the words a student can write in an exam: an act of State is an exercise of sovereign power against a person who is not a subject of the State and who owes it no allegiance, done or subsequently adopted by the State, and it is not cognisable by the municipal courts, which cannot examine its legality. Statutory immunity is different: it is a protection expressly conferred by an Act on the Government or its officers, typically barring suits or prosecutions for anything done or intended to be done in good faith under the Act, and it is confined by the terms of the section conferring it, in particular by the requirement of good faith. To these must be added the constitutional immunities and privileges in Articles 361, 105 and 194.

Act of State

The elements

Four, and all must be present.

1. An exercise of sovereign power, not an ordinary administrative or commercial act.
2. Against a person who is not a subject of the State and owes it no allegiance. This is the decisive element.
3. Done by the State, or done by an officer and subsequently ratified or adopted by it.
4. Not justiciable, in the sense that the municipal courts will not enquire into its legality.

The second element is where almost every examination answer goes wrong. An act of State cannot be pleaded against a citizen. The plea is available in relation to foreigners and, historically, in relation to the annexation of territory and the treatment of the rights of the inhabitants of a newly acquired territory before the new sovereign recognises them.

The historical setting

The doctrine reached India through the acquisition of territory. When a State conquers or annexes territory, the rights that existed under the previous sovereign do not automatically bind the new one; they bind it only when it recognises them, expressly or by conduct. Until then, refusal to recognise a right is an act of State and no court may question it.

Once the new sovereign has recognised the rights of the inhabitants, or once the persons concerned have become its subjects, the doctrine ceases to apply and ordinary rights and remedies revive.

Its place today

Small, and an honest answer says so.

• It cannot be pleaded against a citizen, so it plays no part in ordinary administrative law.
• Its historical function, disposing of claims arising out of annexation, has largely been exhausted.
• The Constitution's guarantees operate against the State in favour of persons within India, and Article 21 is available to non-citizens as well, so the space in which a plea of act of State could defeat a claim is narrow.