Case of the Day: Export-Import Bank of the Republic of China v. Cent. Bank of Liber., 2017 U.S. Dist. LEXIS 56477 (S.D.N.Y. Apr. 12, 2017)

Summary:

Plaintiff Ex-Im Bank of China sought to enforce loan agreements with the National Bank of Liberia against its successor, Central Bank of Liberia. The loan agreement contained a clause that waived sovereign immunity as to the enforcement of the agreement. The defendant nevertheless argued that it was entitled to sovereign immunity because the NBL lacked the authority to enter into the agreement, because Liberian law prohibited NBL from entering into a long term loan.

The court rejected the argument, finding that Liberia's interpretation of the law is not dispositive, and at any rate Liberia provided a legal opinion at the time of the agreement that the loan agreement was lawful under Liberian law.

Takeaway:

Fun with sovereign immunity! It does look unseemly for Liberia to try to walk back its central bank's loan agreement, but it is still an interesting question as to how much domestic law matters for endowing sovereign immunity to a quasi-public institution.