Forum Non Conveniens: The Iran Dilemma

John Cu 
John Cu
March 3, 2015

While you would ordinarily expect a lawsuit between citizens of country A regarding the ownership of property in Country A would be venued in Country A, this is not necessarily true where Country A happens to be Iran.

In Aghaian v. Minassian, 14 C.D.O.S. 1594, plaintiffs are heirs of Gagik Galstian and Knarik Galstian who owned a number of properties in Iran but were forced to abandon them in 1978 when the family fled to Los Angeles after the overthrow of the Shah.  Plaintiffs are women and non-Muslim.

In 1996, the Iranian government issued a ruling allowing the Galstians to enter and leave Iran, reclaim their properties, and freely engage in property transactions. To that end, the Galstians executed a series of powers of attorney naming others as their attorneys in fact over the properties.  By 2003, defendants Minassian and Izadi, both residents of Iran, held powers of attorney for several of Galstian’s properties and executed a general quitclaim deed transferring the properties to themselves for little or no consideration.

In 2013, Plaintiff filed suit in Los Angeles Superior Court seeking damages for breach of fiduciary duty and conversion, as well as an injunction and accounting.  Defendants moved to dismiss and stay the action on the grounds of forum non conveniens and for lack of jurisdiction on defendants and the property themselves.  The trial court granted defendants’ motion.

On appeal, the Second Appellate District held that, although a trial court ruling on a forum non conveniens motion is reviewed under highly deferential standard, in this case, the trial court erred because the record established that Iran does not provide a suitable alternate forum, because Iran provides no remedy at all.

The Court held that defendants completely failed to refute plaintiffs showing that they could not obtain a fair trial in Iran, being women and non-Muslim.  Writing for the Court of Appeal, Justice Bigelow discounted the claim of defendants’ expert that Iranian law imposes no limitation on the right of women or non-Muslims to sue: “[J]ust because a women or non-Muslim may file a lawsuit or present her case at trial is not evidence the proceedings are not stacked against women.”