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The Act of State Doctrine in the Light of the Sabbatino Case
Published online by Cambridge University Press: 28 March 2017
Extract
The purpose of this note is to consider an appropriate limitation on the use of the “Act of State Doctrine,” particularly in the light of Judge Dimock’s decision in Banco National de Cuba v. Sabbatino, 193 F. Supp. 375 (D.C., S.D.N.Y., 1961).
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- Copyright © American Society of International Law 1962
References
1 55 A.J.I.L. 741 (1961). The record on appeal in this case was certified to the U. S. Court of Appeals for the Second Circuit on May 26, 1961.
2 The term “taking” as used herein means a compulsory transfer to the state of property or rights not theretofore owned by the state through the exercise of state sovereignty. The significant fact is whether or not the “t a king” is of such a nature as to justify a challenge to its legality either on the national or international level.
3 The traditional terms of art in public international law which denote the law, the judges and the courts of a particular sovereign state are “municipal law,” “municipal judges” and “municipal courts,” respectively. Some writers have used the terms “national law,” “national judges” and “national courts.” The traditional terms will be used herein. Where a sovereign state has a federal system, the term “municipal courts” includes both Federal and State courts.
4 The term “international law” as used herein means “public international law,” as distinguished from “private international law” or “conflict of laws.”
5 See Restatement, The Foreign Relations Law of the United States, $ 28d (Tent. Draft No. 4, 1960).
6 Ibid.
7 It might also be added that the municipal judge in refusing to recognize the law of a foreign state need not declare such law a nullity within that foreign state—such a declaration would be inconsistent with a recognition of the absolute sovereign right each state exercises within its own territory. Rather, the municipal judge need only refuse to recognize any rights arising out of that law, as to the subject matter of any action brought before him, on the grounds that such law, even though valid under the municipal law of the foreign state, is in violation of international law. In fact some commentators have gone so far as to suggest that a state which recognized any rights arising out of such a foreign law would, itself, be committing an international delinquency. This theory has not as yet been borne out by state practice. However, it is a logical conclusion and may develop as a state practice. See Mann, , “International Delinquencies Before Municipal Courts,” 70 Law Quarterly Review 181 (1954)Google Scholar.
8 Another reason given by our U. 8. Supreme Court in some of its earlier cases for justifying the application of the doctrine was the availability of the diplomatic remedy. See U.S. v. Diekelman, 92 U.S. 520 (1876); Oetjen v. Central Leather Company, 246 U.S. 297 (1918); and Ricaud v. American Metal Company, 246 U.S. 304 (1918). It has become apparent today that the diplomatic remedy is no longer adequate. Its ultimate technique, namely, the use of force, has been prohibited by the United Nations Charter which, at the same time, has failed to provide compulsory legal procedures. In the face of such a dilemma the municipal court may be the only effective remedy open to the claimant.
9 In addition to those commentators from the United States, Great Britain and Austria cited by Judge Dimock at footnote 7 of his decision, we might add the following: from Germany—Raape, Internationales Privatrecht 618–620 (1955); from Belgium—Van, Hecke, “Confiscation, Expropriation and the Conflict of Laws,” 4 Int. Law Quarterly 345 (1951)Google Scholar; De Visscher, Theory and Reality in Public International Law 242 (1957); from The Netherlands—Adriaanse, Confiscation in Private International Law 149 (1956); Kollewijn, , “Nationalization Without Compensation and the Transfer of Property,” 6 Nederlands Tijdschrift voor Internationaal Recht 140 (1959)Google Scholar; Verzijl, , “The Relevance of Public and of Private International Law Respectively for the Solution of Problems Arising from Nationalization of Enterprises,” 19 Zeitschrift für Öffentliches Secht and Völkerrecht 531 (1958)Google Scholar; from Switzerland—Niederer, Der Völkerrechtliche Schutz des Privateigentums 52 (1953); from New Zealand—O’Connell, “A Critique of the Iranian Oil Litigation,” 4 Int. and Comp. Law Quarterly 267 (1955); and Sweden—Hjerner, The General Approach to Foreign Confiscations 186 (1958). This pamphlet reveals, in the author’s opinion, one of the most realistic and convincing approaches written on the general problem of confiscations.
10 Hjerner, op. cit. 201.
11 See The Wall Street Journal (New York ed.), Sept. 14, 1951, p. 3. Such publication may be sufficient, but it is suggested that the United Nations might provide some sort of medium which, upon agreement by all Member States, would be the official publication for the purpose of, among other things, legal notices of this nature. Notice in such an official publication could then be held to bar purchasers from the taking state from raising the defense of bona fides.
12 Such a legal action might be brought to recover (or claim rights in) a product of the taken property. For example, if a manufacturing establishment is taken, the original owner may try to recover some of the products of such establishment which are exported from the taking state.
13 See Anglo-Iranian Oil Co., Ltd. v. Jaffrate et al., 1953 Int. Law Rep. 316; Anglo- Iranian Oil Co., Ltd. v. Idemitsu Kosan Kabushiki, ibid. 304; Anglo-Iranian Oil Co., Ltd. v. S.U.P.O.E. (Venice), 1955 ibid. 19; Anglo-Iranian Oil Co., Ltd. v. S.U.P.O.E. (Rome), ibid. 23.
14 Dept. of State Press Release No. 906, Dec. 6, 1952.
15 In this connection one commentator stated: “The existence of international law has been affirmed, not only by the conduct of the United Kingdom, but also by the behavior of those individuals, nations and companies that have been deterred from buying Iranian oil because of doubts on the legal ownership of the oil. They were deterred solely by AIOC’s threat of legal action, and not by that of the British Government.” Ford, The Anglo-Iranian Oil Dispute of 1951–1952, p. 228 (1954).
16 Certainly the legal risk is greater in the Cuban situation, where the violation of international law is more clear-cut, than it was in the Iranian situation.
17 For example, Professor Bystricky of Czechoslovakia recently buttressed his argument for recognizing the international validity of any measures of nationalization by a state within its territory (even those without compensation) on the grounds that such a view was in accordance with American judicial practice, citing Ricaud v. American Metal Company, above. See Sarraute, , “The Proceedings of the Commission of Private International Law at the 6th Congress of the International Association of Democratic Lawyers,” 83 Journal du Droit International (Clunet) 886–888 (1956)Google Scholar.
18 Jessup, The Use of International Law 141 (1959). Dr. Jessup is now a Judge of the International Court of Justice.
19 Becker, , “Just Compensation in Expropriation Cases: Decline and Partial Recovery,” 1959 Proceedings, American Society of International Law 336; 40 Dept. of State Bulletin 784 (1959)Google Scholar.