Developments in international law, prepared by the Attorney Editor of International Legal Materials
The American Society of International Law September 21, 2007.
President Bush and Australian Prime Minister Howard signed the U.S. Australia Defense Trade Cooperation Treaty (the treaty) on September 5, 2007. The treaty is designed to facilitate the trade of defense goods within a “secure circle” of the two governments and its defense contractors that are able to meet certain standards. The treaty is also expected to decrease the need for individual approval of exports of defense goods when they are supporting U.S.-Australia military or counterterrorism operations; research and development; and are only intended to be used in the U.S. and Australia. Exports that are not within the “secure circle” must obtain U.S. and Australian approval.
*Note when the text of the treaty becomes available on-line, International Law in Brief will post it.
Eritrea Ethiopia Claims Commission Decisions 7 Guidance Regarding Jus ad Bellum Liability (July 27, 2007).
Click here for Decision 7. (Approximately 9 pages).
Eritrea and Ethiopia signed an accord December 12, 2000 (the December Agreement)
in which they agree to end their hostilities and submit to binding arbitration to resolve a number of issues including the demarcation of the disputed boundary between them. Article 5 of the December Agreement created the Eritrea-Ethiopia Claims Commission (the Commission). The Permanent Court of Arbitration (PCA) serves as the Registry for the Commission.
Professor Hans van Houtte serves as the President of the Commission. The terms of the December Agreement permitted each nation to select two members to serve on the Commission. Ethiopia chose Judge George Aldrich and Dean James Paul; and Eritrea picked Mr. John Crook and Ms. Lucy Reed. The seat of the Commission is The Hague.
Since its founding in 2000, the Commission has issued a number of decisions. (See for example, Partial Award, Civilian’s Claims—Eritrea’s Claims 15, 16, 23 & 37-32, 44 I.L.M. 601 (May 2005); Partial Award—Civilian’s Claims—Ethiopia’s Claim 5, 44 I.L.M. 630 (May 2005); Partial Award Regarding Eritrea Central Front Claims 2, 4, 6, 7, 8, and 22, 43 I.L.M. 1249 (Nov. 2004); Partial Award Regarding Ethiopia’s Central Front Claim 2, 43 I.L.M. 1275 (Nov. 2004)).
Decision 7 provides direction to the parties for the final set of hearings on the scope of Eritrea’s liability for violations of jus ad bellum, the law regulating the use of force, as the Commission set forth in its partial award Ethiopia’s claims 1-8 (December 19, 2005).
The two nations disagreed on the extent of damage claims. Ethiopia argued that the Commission's partial award and finding of a violation of jus ad bellum provided the basis for it to obtain damages for a wide range of injuries that the Commission did not specifically address in its partial award. Eritrea by contrast, perceived its duty to provide reparations as a much more circumscribed one than Ethiopia, and limited to the Commission's partial award.
While the Commission ultimately decides to reserve decision on Ethiopia’s claims to the second stage of the proceedings to allow the parties to present their arguments more precisely; Decision 7 provides interesting insight on the Commission’s reasoning.
In its discussion of what standard of legal causation it should apply, the Commission analyzes various tests including direct and indirect damages, the foreseeability of causation, before deciding to choose the standard of proximate cause with weight paid to the reasonable foreseeability of damage resulting from the international delit.
In its examination of how it should approach Ethiopia’s claims, the Commission discussed the relative paucity of clear guidance of cases in which states have been held to be internationally responsible for war damage. While Ethiopia urged the Commission to examine the practice of the United Nations Claims Commission (UNCC) that handled Kuwait’s claims after the 1990 war with Iraq, the Commission refused to do so. In the Commission’s view, while some characteristics of the UNCC are relevant to its work, others are not. The Commission relied in particular upon the role of the Security Council, and how the Council’s resolutions differed dramatically in the context of Eritrea/Ethiopia, where they did not assign blame to either party, than in the case of Iraq and Kuwait.
Peterson v. Iran (D.D.C. Sept. 7, 2007)
Click here for document. (Approximately 43 pages).
The U.S. District Court for the District of Columbia (court) ordered Iran to pay a record $2.6 billion in compensatory damages to 26 survivors, almost one thousand family members, and representatives of the estates of the 241 U.S. Marines killed in the bombing of their barracks in Beirut, Lebanon in 1983. The court refused to order punitive damages however, under Haim v. Islamic Republic of Iran, 425 F. Supp. 2d 56, 71 (D.D.C. Mar. 24, 2006); punitive damages are not available against foreign states or government entities.
The plaintiffs, family members and representatives of the estates of the marines who were killed in the bombing, brought suit pursuant to inter alia the Foreign Sovereign Immunities Act (FSIA) 28 U.S.C. §1605(a)(7) against Iran and the Iranian Ministry of Information and Security (MOIS)(defendants). They alleged that the defendants provided material support to Hezbollah, the organization that bombed the barracks. In 2003, the court held that the defendants were guilty of providing material financial and logistical support to Hezbollah, and that family members suffered mental anguish and loss of society because of their relatives’ deaths. It ordered special masters to make findings regarding the compensatory and punitive damages for each plaintiff. (Peterson v. Islamic Republic of Iran, 264 F.Supp 2d 46, 61 (D.D.C. 2003)). In its September 7, 2007 order, the court reviewed the determinations of the special masters de novo.
Before deciding the appropriate amount of damages to award to the plaintiffs, the court first examined whether the plaintiffs asserted valid claims under the state law in which they were domiciled at the time of the bombing. The plaintiffs brought three types of claims: 1) wrongful death; 2) battery; and 3) intentional infliction of emotional distress (IIED).
After examining the laws of the states were the Marines were domiciled before the attack and finding that the state wrongful death and battery statutes would allow the plaintiffs’ claims, the court allowed plaintiffs to recover compensatory damages in both areas.
The court used a three-prong approach in its analysis of the IIED claims. It first examined whether the state law in which the plaintiff was domiciled permitted such claims. Second, it analyzed how states treat attacks to family members and whether the physical presence of the third party family members at the bombing was necessary. Third, it reviewed which family members had standing to bring such suits. While all of the 35 states in which the 753 plaintiffs asserting the IIED claim permitted such suits, states differed whether they required family members to be present at the time the harm occurred. The court permitted the majority of the plaintiffs’ claims to proceed under the rationale of Heiser v. Islamic Republic of Iran, 466 F.Supp.2d 229, 305 (D.D.C. Dec. 22, 2006), that because a terrorist attack targets not only the victim but also his family, the court would not require the physical presence of the family member. Two states however, Louisiana and Pennsylvania, have required the third party to be present when the harm occurs to be able to recover damages. The court therefore held that plaintiffs domiciled in those states lack standing to bring IIED claims.
United States v. Noriega, Order Dismissing Defendant’s Petition for Writ of Habeas Corpus and Lifting Stay of Extradition (S.D. Fla. Sept. 7, 2007)
Senior U.S. District Court Judge William M. Hoeveler denied former General Manuel Noriega’s petition for a writ of habeas corpus and lifted the partial emergency stay to extradition that he imposed September 5, 2007. Judge Hoeveler imposed the stay to allow Noriega to present evidence to support his allegation that France will not follow the rules of the Geneva Convention Relative to the Treatment of Prisoners of War, August 12, 1949, 6 U.S.T. 3316, 75 U.N.T.S. 135 (Convention) after it obtains his extradition to stand trial for alleged money laundering activities, and for the U.S. government to respond to that allegation.
The U.S. District Court for the Southern District of Florida determined that Noriega was a prisoner of war (POW) pursuant to the Convention in 1992 (see United States v. Noriega, 808 F. Supp. 791, 803 (S.C. Fla. 1992)). Article 12 of the Convention permits the detaining power to transfer POWs to another party to the Convention after satisfying itself that the nation to which the POW is transferred is willing and able to apply the Convention. The U.S. presented information to the court that France plans to provide Noriega with the rights due him as a POW under the Convention.
United States: Eli Lilly do Brasil, Ltda. v. Federal Express Corp. (2d Cir. Sept. 11, 2007)
Click here for document. (Approximately 30 pages).
The U.S. Court of Appeals for the Second Circuit affirmed the district court’s holding that U.S. federal common law, rather than Brazilian law, applied to a liability suit between Eli Lilly do Brasil (Lilly) and Federal Express (FedEx).
In 2002 Lilly contracted with Nippon Express do Brasil, which in turn subcontracted with FedEx, to ship fourteen drums of pharmaceuticals from its factory in Brazil to Japan via the FedEx hub in Memphis, Tennessee. Hijackers stole a truck and the load of pharmaceuticals worth about $800,000 while it was en route in Brazil. The waybill for the shipment limited FedEx’s liability to $20 per kilogram for stolen goods for a total liability of $28,000.
Lilly brought suit against FedEx in the Southern District of New York. Both companies moved for partial summary judgment. While FedEx claimed that its liability should be limited to the amount of the way bill, Lilly by contrast, argued that the court should apply Brazilian law which would permit liability beyond the amount of the way bill if the court determined that FedEx acted grossly negligent in its shipment of the pharmaceuticals. The district court granted the motion of FedEx. Lilly appealed.
The Second Circuit reviewed the district court’s determination de novo. The court noted that federal common law governs cases involving the liability of air carriers for goods that are missing or destroyed. Federal common law choice of law rules requires the court to apply the law of the jurisdiction with the “greatest interest in the litigation.” (see In re Koreag, Controle et Revision S.A., 961 F.2d 341, 350 (2d Cir. 1992)). The Second Circuit thus compared two sections of the Restatement (Second) Conflict of Laws, §197 and §188, to determine whether U.S. or Brazilian law should apply. While a number of factors seemed to indicate that the court should apply Brazilian law, including the fact that the parties negotiated the contract in Brazil between a Brazilian company and a U.S. company that regularly conducts business in Brazil, the court nonetheless decided to apply U.S. federal common law to the case. In making this determination, the court reasoned that the Restatement specifically provides that the reasonable anticipation of the enforceability of a contract takes precedence over other factors leading to the application of foreign law that is incongruous with that expectation.
The dissent concurred with the majority’s application of federal common law; but opined that Brazilian law should govern the suit because Brazil’s interest in governing commerce within its borders should take precedence over the U.S. interest in enforcing the contract.
International Centre for the Settlement of Investment Disputes: Bayview Irrigation District et al v. United Mexican States, Final Award on Jurisdiction (21 June 2007)
Arbitrators: Professor Vaughan Lowe (President), Professor Ignacio Gomez-Palacio (Arbitrator) and The Honorable Edwin Meese III (Arbitrator)
An arbitral tribunal constituted under NAFTA Chapter Eleven held that it lacked jurisdiction to hear a dispute brought by 46 Texas irrigation districts, individuals and corporations grouped under the name “Bayview Irrigation District et al” (Claimants) against Mexico (Respondent) over water rights to the Rio Grande.
Claimants alleged that they owned water allotted to the United States under the Water Treaty of 19944, which divided the waters of the Rio Grande between Mexico and the United States. They contended that although Respondent possessed no right to Claimants’ water under the Water Treaty, it captured and diverted their water for use by Mexican farmers, breaching the North American Free Trade Agreement’s (NAFTA) investment chapter Articles 1102 (National Treatment), 1105 (Minimum Standard of Treatment), and 1110 (Expropriation).
The preliminary issue under dispute was whether Claimants were “investors” and/or had an “investment in Mexico,” and thus whether their claims were within the coverage of NAFTA Chapter Eleven.
Respondent challenged the tribunal’s jurisdiction by arguing that the claim fell outside NAFTA’s scope. It noted that under Article 1101(1), which serves as the “gateway” to Chapter Eleven, the protections are confined to “(a) investors of another Party or (b) investments of investors of another Party in the territory of the Party.” Respondent then contended that Claimants did not meet any of these jurisdictional requirements, first because under Mexican law they could not have property rights in the Rio Grande waters and second, because its alleged investment was located wholly within the United States rather than in Mexico.
By contrast, Claimants argued that the tribunal had jurisdiction to hear the dispute based on two grounds. First, they contended that they were “investors of another Party” under Article 1101(1)(a) because they owned water rights and had invested millions of dollars in facilities for the storage and conveyance of water to their farms in the Rio Grande Valley. They contended that this, without more, afforded jurisdiction to the tribunal. In support of this view, they compared the wording of Articles 1102 and 1105, with Article 1110 and noted that unlike Article 1110, Articles 1102 and 1105 contained no requirement concerning the location of the investor or the investment. Second, Claimants argued that under Article 1101(1)(b) they had an “investment,” because their water rights were “property rights acquired for agricultural purposes” and that their investment was “in Mexican territory” because the water was physically located in Mexico at the time it was seized and diverted.
Notably the United States made a submission pursuant to NAFTA Article 1128. In supporting Mexico for a limited reach to Chapter Eleven, it contended that the aim of investment agreements was the protection of “foreign investments.”
The tribunal rejected both of Claimants’ jurisdictional arguments. In deciding whether they were “investors,” the tribunal sided with Claimants in that the term “investor” did not have an explicit territoriality requirement as did the term “investment.” However, it held that because an “investor” is defined under Article 1139 as one who “seeks to make, is making or has made an investment,” the term “investor” should be read in conjunction with the term “investment,” thus, incorporating by reference its explicit territorial limitation.
The tribunal then found that while NAFTA defined the term “investment,” it did not define “foreign investment.” Nevertheless, the tribunal held that Chapter Eleven’s ordinary meaning and purpose was that it concerned “foreign investment,” and therefore not intended to protect “investors whose investments are wholly confined to their own national States.” When ruling what made an investment “foreign,” the tribunal did not purport to establish a definitive test, but ruled that “a salient characteristic will be that it is primarily regulated by the law of a State other than the State of the investor’s nationality.” In applying its test, the tribunal acknowledged that Claimants had invested in farms and irrigation equipment, thus were “investors.” However, because it found that their investment was solely within the State of Texas and regulated by US law, it concluded that Claimants were not “foreign investors in Mexico” but “domestic investors in Texas.”
Finally, in deciding whether Claimants had made an “investment in Mexico” the tribunal held that its water rights fell within the definition of “property” in Article 1139(g), and hence were an “investment.” However, it found that its investment was not “in the territory of Mexico” because Claimants could not own the physical waters of rivers flowing in Mexican territory as one could own a bottle of water.
United Nations Declaration on the Rights of Indigenous Peoples (Sept. 7, 2007)
Click here for document. (Approximately 12 pages).
The United Nations General Assembly adopted the Declaration on the Rights of Indigenous People (Declaration) on September 7, 2007. Australia, Canada, New Zealand, and the United States did not vote in favor of the declaration, and
Azerbaijan, Bangladesh, Bhutan, Burundi, Colombia, Georgia, Kenya, Nigeria, Russian Federation, Samoa, Ukraine abstained.
In the preambular language to the Declaration, the General Assembly recognizes the historic injustices that indigenous people have endured and reaffirms their right to be free from all discrimination. It emphasizes the role that indigenous cultures play in protecting and sustaining the environment. It notes that indigenous families must be able to raise and educate their children, consistent with the rights of the child.
The General Assembly cites the Charter of the United Nations and the Universal Declaration of Human Rights as the bases of the right of indigenous persons to full enjoyment of all human rights and fundamental freedoms. The Declaration provides that indigenous persons have the right not to be forcibly assimilated; and that states must create systems to allow indigenous persons to seek remedies for actions that dispossess them of their land or assets; or any forced migration. They are also to be free from any type of propaganda designed to create racial or ethnic prejudice against them. Indigenous persons must have the right to enjoy their cultural and spiritual practices and protect their religious and cultural sites. States must work with indigenous persons to develop ways to facilitate the repatriation of cultural objects and human remains.
The Declaration provides for the rights of indigenous people in a wide array of areas such as education and the environment, and then sets forth specific responsibilities of States with respect to each one. For example, States must work with indigenous people to take steps to ensure that they have access to education in their culture and in their own language. Because indigenous people have the right to conserve and protect their land, States must ensure that no dangerous materials are stockpiled or discarded on it.
States and the United Nations must provide indigenous people with technical assistance and financial resources to achieve the provisions in the Declaration.
BRIEFLY NOTED:
Letter from Romeo Dallaire to General Martin Agwai, the Commander of the Hybrid United Nations African Union Peacekeeping Mission in Sudan (UNAMID) (Sept. 17, 2007).
Former head of the UN peacekeeping forces in Rwanda, Lt. General Romeo Dallaire, now a Canadian Senator, issued an open letter September 17, 2007 to Margin Agwai, the new head of the hybrid African Union United Nations peacekeeping mission in Sudan. In it, Dallaire congratulated Agwai on his appointment but cautioned him in a number of areas. Dallaire noted that the hybrid peacekeeping team is a novel approach which will need to resolve legal and practical issues. Because he views UN Security Council Resolution 1769 as being vague on the command and control and reporting of the mission, he urges Agwai to obtain clarification on both as soon as possible. Further, he views it as imperative that Agwai obtain the broadest possible reading of the mandate under Chapter VII of the UN Charter.
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