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The United States-Rumanian Claims Settlement Agreement of March 30, 1960

Published online by Cambridge University Press:  28 March 2017

Gordon A. Christenson
Gordon A. Christenson*
Affiliation:
Office Legal Adviser of the, Department of State*
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Extract

On March 30, 1960, the United States and Eumania settled by agreement certain claims of American nationals against Rumania. The agreement provides for the payment by Rumania of a lump sum in discharge of those claims.

In recent years the device of the en bloc or lump-sum settlement of international claims has to some extent replaced the use of the mixed claims commission. Lump-sum settlements between nations are not unique to the 20th century, however, and as early as 1802, the United States paid Great Britain a lump sum of £600,000 ($2,664,000) to settle certain debt claims. In the 19th century also, the United States obtained lump-sum settlements from Prance, Spain, Great Britain, Denmark, Peru, Belgium, Mexico, Brazil and China. Early in the present century mixed claims commissions were used in deciding claims between the United States and Great Britain, war damage claims against Germany, Austria and Hungary, claims between the United States and Mexico, and claims between Panama and the United States. When the work of the United States-Mexican General Claims Commission remained uncompleted after two successive conventions which extended the existence of the Commission, and when practical difficulties beset the United States-Mexican Special Claims Commission, an en-bloc settlement of all claims was the only solution. That settlement signaled disillusionment with mixed claims commissions. Thereafter, the major international claims settlements involving the United States were on a lump-sum basis. The very next settlement was one concluded on October 25, 1934, with Turkey. It provided for the payment of a lump sum of $1,300,000 to settle certain outstanding claims of American citizens against Turkey.

Type
Research Article
Information
American Journal of International Law , Volume 55 , Issue 3 , July 1961 , pp. 617 - 636
Copyright
Copyright © American Society of International Law 1961

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References

1 Dept. of State Press Release No. 159 of March 30, 1960. The text of the agreement was also printed in 54 A.J.I.L. 742 (1960).

2 Convention for Payment of Indemnities and Settlement of Debts, signed at London on Jan. 8, 1802. 1 Malloy, Treaties 610 (1910).

3 For a list of past en-bloc settlements, see Table II of Appendix B, 3 Whiteman, Damages in International Law 2068 j (1943).

4 A “mixed claims commission” is a mixed arbitral tribunal with jurisdiction to determine all claims falling within categories enumerated in an agreement rather than only specific issues of a specific dispute.

5 Special Agreement for the Submission to Arbitration of Pecuniary Claims, signed at Washington on Aug. 18, 1910, 37 Stat. 1625; U. S. Treaty Series, No. 573; 3 Redmond, Treaties 2619 (1923); 5 A.J.I.L. Supp. 257 (1911). For a report of the work of the commission, see Nielsen, American and British Claims Arbitration (1926).

6 Arts. 304 and 305, Annex 1-9, Treaty of Peace between the Allied and Associated Powers and Germany (Versailles Treaty), signed at Versailles on June 28, 1919, 3 Redmond, Treaties 3329 at 3477-3478 (1923), 13 A.J.I.L. Supp. 326 (1919), established Mixed Arbitral Tribunals between each of the Allied and Associated Powers and Germany. The United States did not become a party to these articles of the Versailles Treaty. The Mixed Claims Commission, United States and Germany, decided war damage claims of American nationals. See the Agreement for a Mixed Commission, signed at Berlin Aug. 10, 1922, U. S. Treaty Series, No. 665; 3 Redmond, Treaties 2601 (1923); 16 A.J.I.L. Supp. 171 (1922).

7 Arts. 256 and 257 with Annex, Treaty of Peace between the Allied and Associated Powers and Austria, signed at Saint-Germain-en-Laye Sept. 10, 1919. 3 Redmond, Treaties 3254-3255 (1923); 14 A.J.I.L. Supp. 140 (1920).

8 Arts. 239 and 240 with Annex, Treaty of Peace between the Allied and Associated Powers and Hungary, signed at Trianon June 4, 1920. 3 Redmond, Treaties 3652-3654 (1923); 15 A.J.I.L. Supp. 108 (1921).

9 General Claims Convention with Mexico, signed at “Washington Sept. 8, 1923, 43 Stat. 1730; U. S. Treaty Series, No. 678; 4 Trenwith, Treaties 4441 (1938); 18 A.J.I.L. Supp. 147 (1924) ; Special Claims Convention with Mexico, signed at Mexico City Sept. 10, 1923, 43 Stat. 1722; U. S. Treaty Series, No. 676; 4 Trenwith, Treaties 4445 (1938); 18 A.J.I.L. Supp. 143 (1924).

10 Hunt, American and Panamanian General Claims Arbitration under the Conventions between the United States and Panama of July 28, 1926, and December 17, 1932 (1934).

11 Convention Providing for En Bloc Settlement of Special Claims, signed at Mexico City April 24, 1934, 49 Stat. 3071; U. S. Treaty Series, No. 878; 4 Trenwith, Treaties 4487 (1938); 30 A.J.I.L. Supp. 106 (1936). See Report to the Secretary of State, Special Mexican Claims Commission, for a summary of the domestic distribution of the amount received.

12 Nielsen, American-Turkish Claims Settlement, Opinions and Report (1937).

13 See Ralston, Law and Procedure of International Tribunals 5, 33 (rev. ed., 1926).

14 The device, used intermittently since 1802, has recently gained recognition as a means of settling claims against Communist countries whose political philosophy is cynical of international adjudication except when it can be used as a means to obtain a politically or economically desirable goal. Recent settlements include lump-sum agreements between France and Bulgaria, Norway and Bulgaria, Sweden and Bulgaria, the United Kingdom and Bulgaria, the United Kingdom and Czechoslovakia, the United Kingdom and France, the United Kingdom and Poland, the United Kingdom and Yugoslavia, the United States and Yugoslavia, the United States and Poland and, of course, the United States and Rumania. Negotiations are currently in process between the United States and Czechoslovakia and Bulgaria.

15 In the Yugoslav claims program, the Foreign Claims Settlement Commission applied international law, for example, in distributing the lump sum received from Yugoslavia to eligible claimants with valid claims under the agreement as interpreted by international law. See Settlement of Claims by the Foreign Claims Settlement Commission of the United States and its Predecessors 37, 133, 134 (1955). A valuable book soon to be published by the University of Syracuse Press on the subject of lump-sum settlements and their domestic distribution is Lillich, International Claims: Their Adjudication by National Commissions (to be published during 1961).

16 The Yugoslav Claims Settlement Agreement of July 19, 1948, has, however, been called a compromis, on the ground that it refers to an agency determining awards domestically and permits briefs to be filed by the Yugoslav Government to protect a reversionary interest in any fund left over. Coerper, , “The Foreign Claims Settlement Commission and Judicial Review,” 50 A.J.I.L. 868 at 877 (1956)Google Scholar. The Yugoslav settlement agreement certainly was not a compromis in the usual sense of that word. The, reference to the domestic agency was ambiguous and uncertain and, significantly, the agreement explicitly settled all the claims in advance of domestic adjudication. Art. 1 of the agreement stated that Yugoslavia paid $17,000,000 “in full settlement and discharge of all pecuniary claims . . . against the Government of Yugoslavia,” with exceptions not important here. The reversionary interest Yugoslavia had in limiting the domestic adjudications could not affect the negotiated settlement which took the place of a compromis. Settlement of Pecuniary Claims against Yugoslavia, signed at Washington July 19, 1948, 62 Stat. (3) 2658; T.I.A.S., No. 1803. Moreover, the agreement stated in Art. 8:

“The funds payable to the Government of the United States under Article 1 of this Agreement shall be distributed to the Government of the United States and among the several claimants, respectively, in accordance with such methods of distribution as may be adopted by the Government of the United States. Any determinations with respect to the validity or amounts of individual claims which may be made by the agency established or otherwise designated by the Government of the United States to adjudicate such claims shall be final and binding.” (Emphasis added.)

While the last sentence of Art. 8 refers to some type of adjudication, it must be re membered that the claims were already settled and that the final and binding provision was inserted to make certain the amounts of the individual awards to be paid from the lump sum. That was a distribution function, however, not an international adjudication function. Coerper, in fact, examined this distinction in an earlier part of his article, loc. cit. above, at 873. See also Clark, , Opinion in re Distribution of the Alsop Award (1912), 7 A.J.I.L. 382 (1913)Google Scholar

17 Clark, ibid.; Coerper, loc. cit.

18 Table II of Appendix B, 3 Whiteman, op. cit. note 3 above, lists the amounts of en-bloc settlements, the amounts claimed before domestic commissions, the amounts of the awards rendered and the percentage of recovery in cases where damages were allowed. An equitable arrangement has been used to compensate in full awards up to $1,000 and to pay $1,000 on all other awards prior to apportioning the remainder of the fund on a ratable basis. See Sec. 8, Title I, of the International Claims Settlement Act of 1949, as amended, 22 U.S.C. § 1627 (c) (1958).

19 See generally, Doman, , “Postwar Nationalization of Foreign Property in Europe,” 48 Col. Law Rev. 1148 (1948)Google Scholar. See also note 57 below.

20 Titles II and III of the International Claims Settlement Act of 1949, as amended, 22 U.S.C., Ch. 21, subehs. II and III. Executive Order No. 10644, Nov. 8, 1955, 20 Fed. Reg. 8363, authorized the Attorney General to perform the functions granted to the President under the statute to liquidate Bulgarian, Hungarian and Bumanian property. An article on the subject, published before this action took place, is one by Rubin, , “The Almost-Forgotten Claimant: American Citizens’ Property Rights Violated,” 40 A.B.A.J. 961 (1954)Google Scholar.

21 See note 14 above.

22 62 Stat. (3) 2658; T.I.A.S., No. 1803.

23 T.I.A.S., No. 4451; Dept. of State Press Release No. 159 of March 30, 1960; 54 A.J.I.L. 742 (1960).

24 T.I.A.S., No. 4545; Dept. of State Press Release No. 395 of July 16, 1960; 43 Dept. of State Bulletin 226 (1960); 55 A.J.I.L. 540 (1961).

25 Dept. of State Press Release No. 778, Nov. 6, 1959.

26 69 Stat. 562 (1955) ; 22 U.S.C. § 1641 (1958).

27 The vesting of Rumanian assets which had remained blocked in the United States since World War II was authorized by Art. 27 of the Treaty of Peace with Rumania, signed at Paris Feb. 10, 1947, and in force Sept. 15, 1947, 61 Stat. (2) 1757, T.I.A.S., No. 1649; 42 A.J.I.L. Supp. 252 (1948). Such provision permitted each of the Allied Powers to take any action with respect to Rumanian property within its territory “and to apply such property or the proceeds thereof to such purposes as it may desire, within the limits of its claims and those of its nationals against Rumania or Rumanian nationals, including debts, other than claims fully satisfied under other Articles of the present Treaty.”

28 Foreign Claims Settlement Commission of the United States, Eleventh Semiannual Report to the Congress for the Period Ending December 31, 1959, at 1 (1960).

29 Loc. cit. note 1 above.

30 Ibid.

31 For a subsequent lump-sum settlement see the Agreement between the United States and Poland of July 16, 1960, loc. cit. note 24 above; and Rode, 55 A.J.I.L. 452 (1961).

32 69 Stat. 562 (1955) ; 22 U.S.C. § 1641 (1958).

33 64 Stat. 12 (1950); 22 U.S.C. § 1621 (1958). S. 1987 was introduced on May 29, 1961, to provide, inter alia, for adjudication of certain claims arising between the date of the statute and the date of the agreement.

34 Sec. 316, Public Law 285, 84th Cong., 69 Stat. 574 (1955) ; 22 U.S.C. § 16410 (1958). That section limited the Commission to a four-year period for completing its determination of claims presented under Sec. 303.

35 Foreign Claims Settlement Commission of the United States, Tenth Semiannual Report to the Congress for the Period Ending June 30, 1959 (1960).

36 H. Rep. No. 624, 84th Cong., 1st Sess., at 3 (1955).

37 The applicable portions of the law are :

“The Commission shall receive and determine in accordance with applicable substantive law, including international law, the validity and amounts of claims of nationals of the United States against the Governments of Bulgaria, Hungary, and Kumania, or any of them, arising out of the failure to—

“(1) restore or pay compensation for property of nationals of the United States as required by article 23 of the treaty of peace with Bulgaria, articles 26 and 27 of the treaty of peace with Hungary, and articles 24 and 25 of the treaty of peace with Rumania. Awards under this paragraph shall be in amounts not to exceed two-thirds of the loss or damage actually sustained ;

“(2) pay effective compensation for the nationalization, compulsory liquidation, or other taking, prior to August 9, 1955, of property of nationals of the United States in Bulgaria, Hungary, and Rumania; and

“(3) meet obligations expressed in currency of the United States arising out of contractual or other rights acquired by nationals of the United States prior to April 24, 1941, in the case of Bulgaria, and prior to September 1, 1939, in the case of Hungary and Rumania, and which became payable prior to September 15, 1947.” 22 U.S.C. § 1641b (1958).

38 In addition to Rumania, Bulgaria, Hungary and the U.S.S.R., present law authorizes the Foreign Claims Settlement Commission of the United States to make awards to American claimants against Czechoslovakia under Public Law 85-604, 85th Cong. Claims against Italy under Public Law 285 were paid from a lump sum paid by the Government of Italy under the terms of the so-called Lombardo Agreement, 42 A.J.I.L. Supp. 146 (1948).

39 A natural person who is a citizen of the United States, or who owes permanent allegiance to the United States, and (B) a corporation or other legal entity which is organized under the laws of the United States, any State or Territory thereof, or the District of Columbia, if natural persons who are nationals of the United States own, directly or indirectly, more than 50 per centum of the outstanding capital stock or other beneficial interest in such legal entity. It does not include aliens.“ 69 Stat. 570 (1955); 22 U.S.C. § 1641(2) (1958).

This provision was incorporated in the Eumanian agreement as part of Art. II, secs. (a) and (b), which state that the claims to which reference is made in the agreement are those which are:

“(a) directly owned by individuals who were nationals of the United States of America (for this purpose ownership through a partnership or an unincorporated association being considered direct ownership) ;

“(b) directly owned by a corporation or other legal entity organized under the laws of the United States of America or a constituent state or other political entity thereof, if more than fifty per centum of the outstanding capital stock or other beneficial interest in such legal entity was owned directly or indirectly by natural persons who were nationals of the United States of America.”

40 Claim of Margot Factor, Dec. No. Rum-30, loc. cit. note 35 above, at 99. The Claims Settlement Agreement with Rumania states that for purposes of paying treaty claims the term “nationals of the United States of America” refers to nationals who possessed U. S. nationality on both Sept. 12, 1944, the date of the Armistice with Rumania, and on Sept. 15, 1947, the effective date of the Treaty of Peace with Rumania.

41 (b) A claim based upon an interest, direct or indirect, in a corporation or other legal entity which directly suffered the loss with respect to which the claim is asserted, but which was not a national of the United States at the time of the loss, shall be acted upon without regard to the nationality of such legal entity if at the time of the loss at least 25 per centum of the outstanding capital stock or other beneficial interest in such entity was owned, directly or indirectly, by natural persons who were nationals of the United States.” 69 Stat. 573 (1955); 22 U.S.C. § 1641 j (b) (1958).

This provision as amended in 1958 was incorporated in the Claims Settlement Agreement with Rumania as Art. II , secs, (a) and (c), the latter of which limited indirect claims to those : “(c) indirectly owned by individuals or corporations within sub-paragraphs (a) or (b) of this Article through interests, totalling twenty-five per centum or more, in a Rumanian legal entity.” See loc. cit. note 39 above, for sec. (a).

Note the disparity between the indirect rights of individuals under the agreement and under the statute. The statute grants rights to recover for indirect loss in a non-U. S. corporation with 25 percent American beneficial ownership interest. The agreement is narrower, limiting the eligibility to persons with indirect interests in Rumanian corporations. Thus, if a claimant with an interest in a German corporation, for example, has an award under the statute, could other awardees bring an action to prevent the Secretary of the Treasury from paying any additional amounts to the former awardee on the theory that to do so would constitute a breach of the international agreement and deplete the available fund? If that action prevailed, would the claimant have a claim against the United States under the theory of Seery v. U. S., 127 Fed. Supp. 001 (Ct. Cl., 1955) for compensation for the taking of an acquired right without due process of law? See Ely, “A Hidden Hole in the Fifth Amendment: Treaty Power versus Property Rights: A Substitute for the Bricker Amendment,” in Hearings before a Subcommittee of the Committee on the Judiciary, U. S. Senate, 84th Cong., 1st Sess., on S.J. Res. 1, at 920 (1955).

42 72 Stat. 527 (1955); 22 U.S.C. § 1641 j (b) (1958). This amendment was incorporated in the agreement as part of Art. II, sees, (a) and (c), loc. cit. notes 39 and 41, above.

43 See Claim of Eugene L. Garbaty, Dec. No. Rum-13, loc. cit. note 35 above, at 93.

44 A state is under no legal obligation to its nationals in the international settlement of claims of those nationals. Any amount received seems legally to be a national fund on which no claimant has a lien. See Nielsen, American-Turkish Claims Settlement, Opinions and Report 4-5 (1937). See also LaAbra Silver Mining Co. v. U. S., 175 U. S. 423; Frelinghuysen v. Key, 110 U. S. 63; Williams v. Heard, 140 U. S. 529. The U. S. Supreme Court in the foregoing cases emphasized that claims espoused by governments on behalf of nationals are international claims and are settled between governments.

45 Ibid. In the “Alabama” claims settlement with Great Britain, the U. S. Supreme Court clarified the nature of the settlement in two cases. In each of them it was held that the fund was awarded to the United States as a nation and that the United States had no legal or equitable obligation to pay the proceeds to the claimants. The Congress, however, chose to distribute the money among the claimants with valid claims. U. S. v. Weld, 127 U. S. 51 (1888); Williams v. Heard, 140 U. S. 529 (1891). In the latter decision the Supreme Court said:

“The fund was at all events, a national fund, to be distributed by Congress as it saw fit. True, as citizens of the United States had suffered in person and property by reason of the acts of the Confederate cruisers, and as justice demanded that such losses should be made good by the Government of Great Britain, the most natural disposition of the fund that could be made by Congress was in the payment of such losses. But no individual claimant had, as a matter of strict legal or equitable right, any lien upon the fund award, nor was Congress under any legal or equitable obligation to pay any claim out of the proceeds of that fund.”

See also Meade v. U. S., 2 Ct. Cl. 275 (1866), aff’d. 9 Wall. 691 (1869); Gray v. U. S., 21 Ct. Cl. 340 (1886). It was held in the Meade case that the decision of the commission set up to distribute a sum provided in an international settlement was final and not reviewable in the Supreme Court. In the Gray case, the Court of Claims indicated that a person whose claim has been waived by his government has a right against that government, especially under the U. S. Constitution, although “a right often exists where there is no remedy, and a not infrequent illustration of this is found in the relation of the subject to his sovereign, the citizen to his government.” In Haas v. Humphrey, 246 F. 2d 682 (D. C Cir.), cert, denied, 355 U. S. 854 (1957), the contention was made that the U. S. Government, in settling the claimant’s rights against Yugoslavia without his consent, took private property without due process. However, the court refused jurisdiction on grounds that the decision of the Foreign Claims Settlement Commission of the United States was final in distributing to claimants a lump sum received by the United States in full settlement of claims of American nationals against Yugoslavia, and that there was no indication of a violation of procedural due process.

46 See note 41 above.

47 The first payment was due on July 1, 1960, and was paid. The next payment is due of July 1, 1961, and the last payment of five annual installments is due on July 1, 1964. 31 U.S.C. § 547 (1958) reads:

“All moneys received by the Secretary of State from foreign governments and other sources, in trust for citizens of the United States or others, shall be deposited and covered into the Treasury.

“The Secretary of State shall determine the amounts due claimants, respectively, from each of such trust funds, and certify the same to the Secretary of the Treasury, who shall, upon the presentation of the certificates of the Secretary of State, pay the amounts so found to be due.

“Each of the trust funds covered into the Treasury as aforesaid is appropriated for the payment to the ascertained beneficiaries thereof of the certificates provided for in this section. (Feb. 27, 1896, ch. 34, 29 Stat. 32.) ”

48 Loc. cit. note 26 above. Par. 1 of Art. I of the agreement reads:

“(1) The Government of the United States of America and the Government of the Rumanian People’s Republic agree that the lump sum of $24,526, 370, as specified in Article III, will constitute full and final settlement and discharge of the claims described below :

“(a) Claims for the restoration of, or payment of compensation for, property, rights and interests of nationals of the United States of America, as specified in Articles 24 ind 25 of the Treaty of Peace with Rumania which entered into force on September 15, 1947.

“(b) Claims for the nationalization, compulsory liquidation, or other taking, prior to the date of this Agreement of property, rights and interests of nationals of the United States of America in Rumania; and

“(c) Claims predicated upon obligations expressed in currency of the United States of America arising out of contractual or other rights acquired by nationals of the United States of America prior to September 1, 1939, and which became payable prior to September 15, 1947.”

49 Treaty of Peace with Roumania, signed at Paris Feb. 10, 1947 (in force Sept. 15, 1947), Art. 24, pars. 1 and 4. 42 A.J.I.L. Supp. 259 (1948); T.I.A.S., No. 1649, at 52-53.

50 Art. 25. Ibid, at 54.

51 Art. 24, par. 9 (a). Ibid. at 55.

52 Ibid.

53 Although a U. S. representative was sent from the United States to Bucharest in 1948 and remained until 1950, attempts to evoke a response from the Rumanian Government regarding its treaty obligations were futile.

54 By the so-called “Lombardo Agreement” Italy paid the United States $5,000,000 for the compensation of war damage claims of American nationals against Italy for which provision was not made in the Treaty of Peace with Italy. See Art. II of the Memorandum of Understanding with Italy, signed at Washington on August 14, 1947, T.I.A.S., No. 1757, at 32; 42 A.J.I.L. Supp. 152 at 154 (1948). Those claims were determined by the U. S. Foreign Claims Settlement Commission pursuant to Sec. 304 of Public Law 285, which also established the Bulgarian, Hungarian and Rumanian claims program in Sec. 303. In return for the payment of the lump sum by Italy, the United States released enemy assets and blocked accounts, permitting a return to Italy. Art. I of the Memorandum of Understanding, cited above, and Annex I thereof set forth the details of the release of Italian property. The obligations of Italy under the Treaty of Peace have consistently been honored with respect to U. N. nationals, and Italy has paid treaty claims in good faith. All disputes arising under the Treaty of Peace have gone to the U. S.-Italian Conciliation Commission, established under Art. 83 of that treaty. However, see Kane, , “Some Unresolved Problems Regarding War Damage Claims under Article 78 of the Treaty of Peace with Italy,” 45 A.J.I.L. 357 (1951)Google Scholar.

55 They were all drafted simultaneously at the Paris Peace Conference in 1946. See Paris Peace Conference, 1946 (Dept. of State Pub. No. 2868).

56 Article IV of the Agreement states :

“As from the date of this Agreement, the Government of the United States of America will not pursue or present to the Government of the Rumanian People’s Republic claims falling within the categories set forth in paragraph (1) of Article I of this Agreement, without regard to whether the claimants qualify under paragraph (%) of Article I and Article 11 of this Agreement, or claims predicated upon obligations expressed in other than currency of the United States of America arising out of contractual or other rights acquired and payable prior to the date of this Agreement.” (Emphasis added.)

57 See generally: Doman, , “Compensation for Nationalised Property in Post-War Europe,” 3 Int. Law. Q. 323-342 (1950)Google Scholar; “Post-War Nationalization of Foreign Property in Europe,” 48 Col. Law Rev. 1148 (1948)Google Scholar; Drucker, , 36 Grotius Society Transactions 75 (1951)Google Scholar ; Friedman, Expropriation in International Law (1953) ; Gutteridge, , “Expropriation and Nationalization in Hungary, Bulgaria and Rumania,” 1 Int. and Comp. Law Q. 14-28 (1952)CrossRefGoogle Scholar; Herman, , “War Damage and Nationalization in Eastern Europe,” 16 Law & Contemporary Problems 498 (1951)CrossRefGoogle Scholar; Rado, , “Czechoslovak Nationalization Decrees: Some International Aspects,” 41 A.J.I.L. 795-806 (1947)Google Scholar; Re, Foreign Confiscations (1951) ; Sharp, Nationalisation of Key Industries in Eastern Europe (1946); Wortley, Expropriation in International Law (1959).

58 40 Stat. 411; 50 App. U.S.C. §§ 1-39 (1958).

59 5 Fed. Reg. 1400 (1940).

60 Art. 27 of the Treaty of Peace with Rumania, cited note 27 above, at 56-57, provides for the retention and disposition of Rumanian assets in the territory of the Allied Powers. Par. 1 of that article states:

“1. Each of the Allied and Associated Powers shall have the right to seize, retain, liquidate or take any other action with respect to all property, rights and interests which at the coming into force of the present Treaty are within its territory and belong to Roumania or to Roumanian nationals, and to apply such property or the proceeds thereof to such purposes as it may desire, within the limits of its claims and those of its nationals against Roumania or Roumanian nationals, including debts, other than claims fully satisfied under other Articles of the present Treaty. All Roumanian property, or the proceeds thereof, in excess of the amount of such claims, shall be returned. ”

61 H. Rep. 624, 84th Cong., 1st Sess. 13 (1955).

62 Sec. 303(2), Public Law 285, cited note 32 above.

63 Universal Oil Products Co., Claim No. Rum-30,531, Dec. No. Rum-547, loc. cit. note 35 above, at 117 (1958); European Mortgage Series B Corporation, Claim No. Hung-22,020, Dec. No. Hung-1,605, ibid, at 72. In the latter claim, Commissioner Pearl Carter Pace wrote a dissent which appears to reflect the correct rule of international law, that a secured creditor interest constitutes an interest in property which may be taken when the debtor corporation is nationalized. Ibid, at 78. In support of the dissent, see Claim of Joseph and Liana Mention, Docket No. Y-435, Settlement of Claims by the F.C.S.C, of the United States and its Predecessors 92 (1955). It is also interesting to compare the lump-sum settlement agreement concluded between the United States and Poland on July 16, 1960, which provides in Art. 2(e) that claims include “debts owed by enterprises which have been nationalized or taken by Poland and debts which were a charge upon property which has been nationalized, appropriated or otherwise taken by Poland.” Loc. cit. note 24 above,

64 Ibid.

65 The Agreement and Public Law 285 as interpreted by the Foreign Claims Settlement Commission impose a requirement of American nationality which a claimant must have acquired on or before Sept. 1, 1939. Hedwiga Geller, Claim No. Hung-20,506, Dec. No. Hung-36, op. cit. note 35 above, at 37 (1957).

66 Ibid. Commissioner Clay voiced a dissent, however, based on the fact that international law is not concerned with nationality on the date of the acquisition, but only on the date of the taking. However, the majority opinion was not premised upon international law and, accordingly, Commissioner Clay did not meet the issue squarely. The applicable law was not international law but the statute; and the majority opinion was based on a construction of the statute which authorized the determination of claims and not upon the rule of international law which, it is true, imposes a requisite nationality at the time of the wrong and not necessarily at the time of acquisition of the vested right.

67 Karl Wapiennik, Claim No. Rum-30,006, Dec. No. Rum-2. Ibid, at 89 (1957).

68 Howard P. Stemple, Claim No. Hung-20,000, Dec. No. Hung-4. Ibid, at 29 (1957).

69 Arthur Zentler, Claim No. Rum-30,044, Dec. No. Rum-4. Ibid, at 95 (1957).

70 Evelina Ball Perkins, et al., Claim No. Rum-30,192, Dec, No. Rum-264. Ibid, at 106 (1957). In that claim an obligation arising out of treasury notes with an amendatory collateral agreement regarding payment was held to be within the terms of Public Law 285.

71 Adrian Clyde Fisher, Claim No. Rum-30,031, Dec. No. Rum-16. Ibid, at 94 (1957).

72 Margaret Farrell Wotton, Claim No. Hung-21,540, Dec. No. Hung-347, ibid, at 36 (1957) ; Guaranty Trust Co. of N. Y., Claims Nos. Hung-21, 309-21, 312, Dec. No. Hung-714, ibid, at 46 (1958).

73 Note 67 above.

74 Op. cit, note 5 above, at 29.

75 A representative organization is the Foreign Bondholders Protective Council in New York.

76 But see the Agreement on German External Debts, signed at London Feb. 27, 1953, 4 U. 8. Treaties 443; T.I.A.S., No. 2792 (in force for the United States Sept. 16, 1953). The war, however, interrupted payment, and such a comprehensive debt settlement necessarily provided procedures for payment of bonds.

77 In the claim of Hedwiga Geller, cited note 65 above, the Foreign Claims Settlement Commission rejected over the dissent of Commissioner Clay the application of general principles of international law regarding Rumanian debts, and favored basing awards solely on the statute. Statutory interpretation, therefore, became significantly preeminent. See note 66 above.

78 The Washington Post recently reported the conclusion of a lump-sum agreement between the II. K. and Kumania, accompanied by a three-year trade agreement. Kumania agreed to pay the U. K. $3.5 million to settle claims arising from World War II and postwar nationalization measures in Kumania, but oil company claims were excluded, on which negotiations are to commence in 1966. Washington Post, Nov. 11, 1960, p. D-ll.

79 For example, the powers of the President derived from the Constitution, the First War Powers Act, 1941, and the Trading with the Enemy Act of Oct. 6, 1917, as amended, were used as authority for promulgating Executive Order No. 9193 of July 6, '1942, 7 Fed. Reg. 5205. That Executive Order was used in the seizure and liquidation of a Czechoslovak steel mill purchased by the Czechoslovak Government in the U. S., even though Czechoslovakia was not at war with the United States. Par. 2(b) authorized the liquidation of any “business enterprise within the United States which is a national of a foreign country and any property of any nature whatsoever owned or controlled by… and any interest of any nature whatsoever in such business enterprise held by a foreign country or national thereof, when it is determined by the Custodian and he has certified to the Secretary of the Treasury that it is necessary in the national interest….” By this authority it is not necessary that the business enterprise be an enemy national or be owned by a country which is a declared enemy of the United States, so long as the national interest demands seizure. Rubin has encouraged self-help procedures if diplomatic negotiations do not succeed. Rubin, loc. cit. note 20 above, at 961. In the contemporary problems of international affairs, self-help should be used in a very cautious manner and not for any slight provocation.