By the time the Act came into force in November, 1978, the common law had got itself into great difficulties on the issue of sovereign immunity (see [1979] 4 LMCLQ 460). The single most important factor in our jurisprudence is the doctrine of precedent, and precedent demonstrated conclusively, at least it did up to 1977, that a foreign sovereign could not be impleaded in our courts. To this doctrine of absolute immunity there were only a few specialised exceptions. It had become increasingly clear since the second world war that this country, virtually alone among the civilised nations, was holding to a doctrine that was not only inconsistent with contemporary international legal rules and the general practice of other nations, but was manifestly repugnant to the needs of the commercial community.

By dint of clever and contrived argument, distinguishing here, not following there, (the method and devices, in short, that have to be employed within our jurisprudence when one seeks to deflect or reverse the progress of the common law), the Privy Council had managed in 1977 in The Philippine Admiral to bring the maritime law into line with the general practice, but despite the resulting, and admitted, anomaly, had merely confirmed the old bad rule for the ordinary action in personam. This last Lord Denning, M.R., refused to accept in the Trendtex case, in which the Court of Appeal sought to give the death blow to the absolute doctrine by holding that the rule of international law then current was the doctrine of restrictive immunity and that, as international law knew no rule of stare decisis, they were free, and indeed bound, to apply the restrictive doctrine to the instant case. But Donaldson, J., as he then was, in the Uganda Holdings case, at a time when the State Immunity Act was already in force (though it did not apply to the case in hand as the cause of action had arisen long before), declined to follow the Trendtex case, holding that it did not bind him as it was itself inconsistent with an earlier Court of Appeal decision, the Thai-Europe case in which Lord Denning, M.R., himself had seemed to reaffirm, in 1975, the basic rule of absolute immunity, a rule which Donaldson, J., held to be still good law! Goff, J., accepted the Trendtex decision in The Congreso del Partido ([1978] Q.B. 500), and Lord Denning, M.R., reiterated his view on appeal (Oct. 1, 1979) as well as in the Hispano Americana case ([1979] 2 Lloyd’s Rep. 277).

All sorts of pretty complications could have been expected to ensue as the common law went through the prolonged labour pangs customary upon its giving birth to a new and fundamental rule of law. However, most of these we have been spared thanks to the action of the legislature. Let us then look to see precisely what action the legislature has taken.