RESPONSIBILITY OF ‘STATES FOR DAMAGE CAUSED IN THEIR TERRITORY TO THE PERSON OR PROPERTY. OF FOREIGNERS VICTOR M. MAURTUA *: JAMES BROWN SCOTTI “Publications of THE AMERICAN INSTITUTE OF INTERNATIONAL LAW W ye washingicn RESPONSIBILITY OF STATES FOR DAMAGE CAUSED IN THEIR TERRITORY TO THE PERSON OR PROPERTY OF FOREIGNERS A STATEMENT OF THE PRINCIPLES WHICH SHOULD GOVERN THE CODIFICATION OF INTERNATIONAL LAW ON THE SUBJECT BY VICTOR M;MAURTUA Secretary-General ad interim of the American Institute of International Law Associate of the Institute of International Law AND JAMES BROWN SCOTT President of the American Institute of International Law Member and former President of the Institute of International Law PUBLISHED FOR THE AMERICAN INSTITUTE oF INTERNATIONAL Law RY OXFORD UNIVERSITY PRESS NEW YORK 1930 COPYRIGHT, 1030 BY THE AMERICAN INSTITUTE OF INTERNATIONAL LAW PREFATORY NOTE The American Institute of International Law has the honor to transmit an expression of views upon the several matters which form the program of the approaching conference at The Hague for the codification of international law, which is to begin its sessions on the thirteenth day of March of the year 1930, the Executive Council of the Institute having approved on October 31, (929 at its session in Habana. the transmission of studies on each of these Juestions. The present study, on Responsibility of States, was prepared by Mr. Victor M. Maurtua, Minister of the Republic of Peru to the Republic of Brazil, Secretary General ad interim of the American Institute, and As- sociate of the Institute of International Law. While it was written by Mr. Mafrtua, it was nevertheless the result of discussion in advance of its prepa- ration with the undersigned to such an extent that it is the desire of Mr. Madtrtua that the undersigned’s name should appear upon the title-page. The same observation is true of the study on Nationality, prepared in first instance by the undersigned, but discussed in advance and approved by Mr. Mafirtua; so that each of these two studies is to be considered as the joint work of the two, although reduced to written form bv the one whose aame first appears upon the title-page, Finally, the views expressed in these volumes are not to be considered as binding the American Institute as a body, or its Executive Council, but 1s taxing with responsibility the authors in each case. James Brown Scorr President of the American Institute of International Law. HaBaNA, February 18, 1930. THE BASIS OF STATE RESPONSIBILITY (a) The issue of State responsibility is, indeed, the current leading prob- lem of International Law. It may be stated that it involves practically the entire scope of international conduct, since it originates from a definite prin- ciple of law and comprises divers features, such as the definition of the State as an international character, its rights, its obligations, and its powers. In other words, responsibility covers the solution of matters which deal with the activities of the State and the securities which it affords. This unique prob- lem is now assuming the importance which it commands, having been brought to light out of its former exclusive status in political and lay circles. Until just recently, responsibility was confined to special claim proceedings instituted through diplomatic channels, arising out of a one-sided conception of the alleged injury, and their decision was dependent in most cases upon coercion on the part of the States with preponderant power, or, at the most, upon direct settlement or arbitration proceedings that were not in themselves strictly based upon juridical principles. Even to this day there are many who confuse the problem of substantive law involving responsi- bility with the claim proceedings instituted through diplomatic channels, whereas they are not altogether two inseparable subjects. There are certain cases in which a person may institute an international action; and the present tendency is to establish a court with international jurisdiction, to which indi- viduals may have recourse whenever the State raises questions of public policy in order to become immune from its municipal jurisdiction; or when- ever there is a manifest denial of justice. In any event, the possibility of pri- vate citizens resorting to such international jurisdiction evidently shows that no relation necessarily exists between the principle of responsibility and diplo- matic claim proceedings. (b) Responsibility on the part of the State may, or may not, exist; and its definition and scope may vary, depending upon whatever conception of the law is entertained as regards the State itself. If such right should be derived from the will of the State, and if such will purports to comprise peremptory sovereignty of the State in its ancient form, then there is no Nore—The author’s original manuscript in Spanish has been translated into English for this publication by G. Marquez, LL.B. RESPONSIBILITY OF STATES way of conceiving such responsibility, which presupposes that justice is supreme, even over the State’s will. Responsibility is based: first, upon the law as a group of rules of conduct whose binding force lies on principles beyond the will of the State; and secondly, the consequence thereof, that the powers of the State are limited by the juridical force of such rules. The usual lay foundation for the responsibility of the State lies on the fact of territorial sovereignty. Responsibility would thus be a mere conse- quence of the exclusive jurisdiction of the State. This doctrine is explained by stating that national jurisdiction entirely excludes any protection from foreign States. Each State, within its territorial limits, is the only one able to afford proper guarantees to the rights of aliens, and for this reason it is held responsible for whatever undue injury they may sustain. “The very fact of the exclusive authority of the sovereign State” —according to Hall— “establishes its responsibility.” “International relations would not be possible” —Triepel avers—*if the jurisdiction of the foreign State where one resides should not be substituted for that of the home State, whenever the latter is unable to afford proper protection.” This territorial doctrine has been recently applied in the decisions of the Mixed Claims Commission, United States and Germany, in connection with damages charged to Ger- many in colonial possessions not under her control. National jurisdiction might explain the theory of domestic responsibility. However, it would be a mere explanation thereof, and not a judicial founda- tion thereof. The question is the function of enforcing such right within the limits of the territory, with reference to its occupants. In order that such function should have any effect upon a judicial system without the State itself, it requires some element to link it with those judicial systems. It is evident that every State is able to exercise due diligence to prevent injury within the bounds of its jurisdiction. This is, of course, a simple premise; but it is essential to ascertain the basis of the duty to prevent said injury, and the necessity of redress therefor. The doctrine which transforms power into duty must thus be introduced. Moreover, if jurisdiction were to consti- tute the only ground for responsibility, the State would be held liable for all sorts of damage, though only in respect of occurrences within its own boundaries. Both presumptions are, of course, quite incorrect. It would be necessary to amend this construction by including therein the question of exceeding the rights covered by the powers of the State. A broader foundation for the doctrine of State responsibility lies upon the general assent of the members of the Family of Nations. This common assent would assume that the Nations should conform to certain rules and regulations in reference to organization and procedure, and to the general principles which govern the conduct of States. This common right thus established would imply that, if any political entity should refuse to conform THE BASIS OF STATE RESPONSIBILITY 3 to those rules and regulations, it could not expect to be considered as a mem- ber of the Family of Nations; and that any State that should commit a breach of this obligation in respect of foreign subjects within its territorial bounds would be held responsible and accountable for redress. Couched in these terms, the Geneva Preparatory Committee of the Codification Con- ference has propounded the question of the legal foundation of State respon- sibility in the Bases of Discussion submitted to the various governments. The Government of Germany replied that it held the view of the binding force of International Law, and that the general importance of this problem surpasses that of mere responsibility and extends beyond its scope. The Danish Government deems that it is not essential to base the responsibility of States on a purely formal conception. Both the latter and the Swiss governments do not deem it proper to advance international common assent as the reason for responsibility. The Danish Government further avers that it would be difficult to conceive that just because a State does not recognize its responsibility under international law, it should thereby be deprived of its rights to be considered as a member of the Family of Nations. The Swiss Government maintains that it would be a source of confusion to establish too close an occasional relationship between international common assent and responsibility. [t is practically impossible to eliminate altogether purely formal con- ceptions in this issue. The essential principles of responsibility can not very well be severed from their foundation upon the binding force of the law of Nations, inasmuch as responsibility itself “constitutes merely one feature of the general principles of the law.” The settlement of all special cases of responsibility involves the idea of adherence to juridical precedents. The general doctrines implicitly embody the sense of practical solutions. How- ever, whenever the ancient notion of absolute sovereignty is invoked, respon- sibility is thereby avoided. The Roumanian Government has advanced this doctrine in its reply to the Preparatory Committee of the Codification Con- ference. When the doctrine of self-limitation is invoked, responsibility finds its basis upon principles strictly subject to established conventions. How- ever, if the responsibility of States is founded upon the broader doctrine of common right, new fields are thereby laid open for its application. This suggests the advisability of establishing some presumption of law, which should insinuate or justify the handling of matters incident to membership in the Family of Nations. There is a series of issues more or less related to the solution of the fundamental juridical problems, to wit: the rights of aliens; supremacy of municipal or international law, etc. The sanction of jurisdiction, especially in legal matters, depends to a certain extent upon the view adopted for the foundation of responsibility as a feature of the general theory of the law. RESPONSIBILITY OF STATES In the discussion of the development of questions relating to responsi- bility, it is sufficient to establish—Germany maintains, in her reply to the aforementioned inquiry—that the principles of international law, whether derived from contractual obligation or from common usage, are actual rules of law which bind the interested States. It seems useless, she adds, to dis- cuss in detail the ground for the binding force of international law. How- ever, this is just precisely the tendency of one of the schools. It is a prac- tical averment, which bases responsibility upon the will of the State. Re- sponsibility would thus assume a highly inter-State character, eliminating therefrom every consideration in reference to individuals, and would be utterly subjected to the doctrines derived from those two sources. Conse- quently, there would be no occasion for the application of any principles whatsoever. The Government of Japan, on the other hand, in its reply to that same questionnaire, states that the legal binding force of responsibility goes so far as to render the conduct of States subject to the rules and prin- ciples of the law of Nations. This is, indeed, a broader view, which would also exert considerable influence in the practical solution of various forms of responsibility. Moreover, this view is more in line with the statutory provi- sions of the International Court of Justice, which may be considered, at the present stage of international affairs, as one of the organizing agencies of the system of substantive law. (c) There is no question but that, upon undertaking a scientific compila- tion or codification of matters in reference to responsibility, it would be extremely useful to lay a legal foundation therefor, which, while not follow- ing any school in particular, should have a broad and flexible scope, to per- mit of proper application to cover all the practical situations arising from the doctrine of State responsibility, as it is at present conceived in the juridical mind of the world. It would not be quite possible to exclude alto- gether some principle to serve as a general guide in the establishment of a system covering responsibility of States, the spirit of which, either expressly or implicitly, should be ever present in any and all proceedings. Even though this principle might not be expressly stated, it would become neces- sary as judicial precedent in each and every one of the problems derived therefrom, And, just which should this principle be? The doctrine of the common assent of nations has been properly objected to; and the objections raised to the form propounded by the Preparatory Committee of the Codification Conference are due, in part, to a confusion of views. It should be borne in mind, however, that common assent has a double significance: first, the one which may be termed, as Mr. R. Erich has done, the legislative assent cover- ing the rules of the law of Nations; and, second, the rules of conduct to which States and other political entities should conform in order to be THE BASIS OF STATE RESPONSIBILITY 5 entitled to recognition as members of the Family of Nations. It has been this latter meaning of general assent, which has been the subject of con- siderable controversy as regards the meaning itself, and also from the point of view of the effects that have been attributed to same.l However, it is the meaning adopted by the Preparatory Committee of the Codification Confer- ence and by most of the authorities. Mr. De Visscher, in the following state- ment, has combined the doctrine of general assent with the principle of equality among the States: “When States mutually recognize their sovereignty, they also thereby recognize each other’s equal legal rights in the exercise of all the preroga- tives inherent to such sovereignty; and the future relations arising from this recognition are to be established, therefore, on the basis of absolute reciprocity of rights and duties. The responsibility of the States in the international sphere is, therefore, the obligatory complement of their equality. While the mutual recognition of sovereignty represents for each one of the States the freedom of action that is essential for the pursuit of their indi- vidual aims, on the other hand, it renders them subject to the restrictions imposed by the co-existence of other States with rights equal to theirs. Once the State has been recognized by the Family of Nations, it becomes subject to the international law, with the consequent rights and duties, and capable of violating the Law of Nations, and of assuming responsibility therefor.” This eloquent pronouncement of Mr. De Visscher is not, however, alto- gether exempt from the just criticism against the doctrine of general assent of the States. Neither does his conception of equality constitute a satis- factory explanation. All States have the same rights and obligations entailed by membership in the Family of Nations; and of course, they are all liable to incur in a breach of the international law. It is the need for coordina- tion of their activities that establishes their common rights; hence the element of common assent is not altogether essential. This process of legal reason- ing is identical with the one covering the determination of the responsibility of individuals within the State: some individuals might violate the law to {“When a new state is formed under the unquestionable jurisdiction of public inter- national law, it is not dependent upon its own will as to whether it shall or not submit to the universal rules of the Law of Nations. One of the two: either it will become 1 member of the International Community, or else it will not exist as a State, Supposing in Europe, for instance, that a new State should exist outside the juris- diction of the international law; it is absurd. It is incorrect to state that international law is not applicable to the State prior to its securing international recognition; on the contrary, the evidence which it has shown of its intention to observe the Law of Nations, is just precisely one of the grounds which entitles it to international recogni- tion. If this is true, and if it insists, however, upon questioning the effect of recogni- tion, we will readily recede to the extreme doctrine which tends to subject even the birth of the State to the condition precedent of international recognition.” R. Erich: La Naissance et la Reconnaissance des Etats, Académie de Droit International, Recueil des Cours. 1926. III. Tome 13 de la Collection. Librairie Hachette, 1027, Paris. RESPONSIBILITY OF STATES the detriment of others, and their wrongful act would affect the established system of justice, would disrupt social unity, provoke a reaction of public opinion, would alter the ends of life itself, and seriously menace the funda- mental principles of natural justice upon which the peace and welfare of a community are utterly dependent. All of these considerations form the basis of both municipal and international common law, and they might properly complement the conception of equality of States in the international sphere and thus explain their responsibility. It could not be properly stated that there are two conceptions of responsi- bility, one in reference to individuals, and the other pertaining to States; for they are both responsible in the same light, this being essential to the preservation of peace within the State and among the States. This is indeed a practical notion derived from the highest spirit of justice and comity, im- posed by logic itself as a paramount necessity of human existence, and thus impressed upon the mind of man. The doctrine of legal responsibility is unique, and its ground is identical in both municipal and international jurisprudence. This unity of the law has already been set forth in doctrine. The pronouncement of the Institute of International Law at its session held in New York, attributing international character to the rights of man, has discarded the distinctions between the two systems of jurisprudence, and has constituted an International Community as the common guardian of both the individual and the body politic. The rules of conduct which constitute the corpus of the law are applied to human relations throughout the world; and in the strict juridical conception, these relations are precisely identical between individuals and between States. However, their differences arise mainly when it is realized that in the relations of individuals, responsibility and the law are enforced by a perfectly organized system, which is afforded security by a constituted authority; whereas, in the international sphere, although the very same principles hold true, they have not been yet fully developed. It would be a task beset with difficulties, to undertake the co- ordination of the relations of States with one another, or of the character of the International Community. These cannot be considered voluntary in the sense that States might do without them and live in utter isolation, nor are they subject to rules established by the States’ arbitrary will. There is in evidence a certain sense of obligation in this International Community, and although its working organization is now in the making, it can only differ from individual organization in its degree of development. There is an International Community in the juridical sphere, dedicated to preserve order and peace among the Nations of the World, and founded upon the highest sense of justice. ‘Its administration demands that each one of the constituent members of the Family of Nations should hold due respect towards contractual obligations and observe the general accepted rules and THE BASIS OF STATE RESPONSIBILITY 7 recognized principles of international conduct. Their breach entails responsi- bility, and this establishes the necessity for proper redress. This would constitute, in fact, a truly juridical foundation that would properly govern all questions involving the responsibility of States. TY ACTS OF STATE ORGANS (a) In the enforcement of responsibility, the following features have to be considered: first, its general characteristics; secondly, its various forms; *hirdly, its application; and fourthly, its judicial sanction. The general characteristics of responsibility refer especially to the acts of State organs which are to be deemed wrongful per se or because of a misfeasance. The forms of responsibility would cover both the direct obligation of the State in respect of the acts of its own organs and its indirect responsibility aris- ing from the act of another State with which it maintains a special relation- ship. The application would involve the responsibility of the various State organs, regardless of their functions as defined by its municipal law, and even though their acts may have been performed in accordance with the municipal law and in pursuance of the powers thereby granted, or otherwise. The State may also become responsible on account of the attitude it may assume in respect of undue injury inflicted upon aliens by private citizens. The judicial sanction covering State responsibility would, of course, provide also the proper remedy. (b) The wrongful nature of the act in respect of which responsibility is sought to be established is, naturally, a condition precedent thereof. The common law requires that the agent to whom the consequences of the alleged wrongful act are imputed should possess certain qualifications. Likewise, in the Law of Nations it is necessary to establish, in accordance with the law, special qualifications in reference to the agent charged with the alleged njury, as well as the basis of distinction between the acts of the individual n his private and in his official capacity as an officer of the State.l Not all “On what grounds will certain individual acts be imputed, not to the individual who executed them, but through him, to another entity, in fact, an artificial entity in some way supposed to be behind him, namely: the State? We can, of course, perceive through our senses only physical acts of individuals; however, the nature of the ‘State act’ does not possess the perceptible properties characteristic of certain acts. This conception of the State as the ‘power behind’ or the constructive ‘perpetrator’ of these acts, can only be attained by a process of reasoning which we will term ‘imputation’. However, there is only one notion which permits such individual acts to be considerad as acts of the State and attributable to the latter : their conforming to certain valid ACTS OF STATE ORGANS 9 the acts of persons acting in representation or on behalf of the State may be deemed official acts of the latter; and it is essential to deal especially with those acts which pertain exclusively to the performance of official functions and could not be otherwise exercised by a private individual. The essence of responsibility would thus consist of imputing to the State the injury resulting from the act of its agent in violation of an international obligation. The difficulties that arise, however, are in reference to the definition and scope of such international obligations. These obligations may be found expressed in treaties; more or less defined in the common law; they are implied in the attainment of certain purposes, which impose upon the State an efficient conduct towards that end; and, finally, in the observ- ance of a reasonable conduct in pursuing the general or special endeavors incident to national character. All of these obligations may be classed as either positive or negative. However, there is an extensive modern field of new relationships undergoing intense development, which could not very well be defined without due discussion. In this state of affairs, naturally, it has been possible for a great many. new questions to arise, and the interested parties have in vain demanded cognizance by the Law of Nations. The organs or authorities which make of the State a real entity with international character are subject to all the various forms of organization according to the different systems of municipal law. However, this is im- material from the international point of view. The State is the one respon- sible as a legal entity. Its agents act for it and legally bind it. The acts of the agents might not be in accordance with the regulations of the laws in force; they might have exceeded their authority or improperly used their official investiture; and their acts might be entirely beyond the scope of their official functions, but performed by virtue of their being clothed with the robe of public office, or using the means which the State has placed at their disposal. When these acts are performed in the legitimate exercise of the authority of the State, or in pursuance of instructions issued by the proper State organ, there can be no doubt but that the personality of the agent is merged into. that of the State it is the act of the State itself, [f it violates an international obligation, the State proper has committed the requirements, which establish in advance the proper rules to determine under what conditions and by what persons the acts should have been executed. To term an act a ‘State act’ means, therefore, first of all, that it comes within the scope of the activi ies of the State in the sense that it forms part of the usual procedure, and its con- nection with the State is thereby established. The unity of the State entity, therefore, becomes manifest through these acts of the State. . This relationship between the vari- bus organs of the entire entity, founded upon their rules of conduct, forms the basis of ‘imputation’ of the acts to the State. The State is, so to speak, the center where these various acts termed ‘State acts’ converge, by operation of this constructive impu- tation.” Hans Kelsen: Les Rapports de Systeme entre le Droit Interne et le Droit International Public. Académie de Droit International. Recueil des Cours 1926. 'V. Tome 14 de la Collection. Librairie Hachette. Paris. 1g27. RESPONSIBILITY OF STATES breach and should be held responsible for the resulting injury. The very same consequences should follow the cases in which the authority is ex- ceeded, or the usual rules disregarded. If the personality of the State embodies that of its organs, whose action renders its being manifest and concrete, for otherwise it would be a non-entity, it has to be recognized that the limitation consists merely in the fact that the official may not have acted in his capacity as such. If the agent who exceeds his authority has, in fact, acted in his official capacity, using the means placed at his disposal by the State, the responsibility of the latter has in such case been grounded for oractical purposes upon the necessity to afford security to international -elations. It is considered necessary and just, because the State should bear the risks incident to its activities. This question gave rise to a very interesting debate at the Lausanne session of the Institute of International Law. Mr. Strisower, the reporter of the Institute, offered a formula which recognizes the responsibility of the State in connection with the illicit acts of its organs, when the acts are performed under color of official authority. He excepted, however, the case in which the alleged act should be so clearly beyond the authority of its perpetrator that no mistaken impression could have been reasonably conveyed. Mr. de Lapradelle and Mr. Politis raised objections to the latter exception. Mr. De Visscher supported it, stating a doctrine similar to the one of State risks. He believes that from the very moment that official con- nection is established between the State and the delinquent organ the State becomes prima facie responsible. However, the State may overcome this presumption by showing that in the performance of the alleged act the agent has not made use of the powers vested upon him; because it is his ase of his official character, or of the means at his command by virtue of such character, which involve the responsibility of the State. Mr. de Lapradelle then proposed the following amended formula: “The State is responsible for the acts of its organs even when they have exceeded their authority, provided they have performed the same under color of authority as official organs of the State, and making use of the means placed at their disposal.” (c) The other condition precedent to responsibility in reference to the manner in which the acts of the agents of the State have been performed, involves the question of culpability. The main difficulties of this question arise from the attempt to apply to the State the psychological doctrine of culpability derived from the Law of Rome, which, as it is well known, referred to the conduct of persons and not of legal entities. Naturally, his attempt to apply to the body politic the same rules laid down in respect of the acts of individuals, has given rise to a series of more or less rreconcilable objections. The eminent professors Triepel and Anzilotti ACTS OF STATE ORGANS 11 have discussed them in very concrete form. However, all of these objec- tions and new suggestions are entirely too systematic in so far as their justification of practical responsibility is concerned. It is manifest, of course, that when the injurious consequences of a wrongful act are imputed to the State, this cannot involve the question of individual intention, which it does not naturally possess. Otherwise, the State could be charged with fraud or negligence, should its organs act fraudulently or without due dili- gence. There are certain cases, however, in which serious complications arise in the construction of these principles; for instance, as Professor Anzilotti points out, when the State organ discharges its legal obligations under municipal law, which are, on the other hand, contrary to the law of Nations. It would seem altogether too artificial to charge either the execu- ive or the legislative organs with bad faith in respect of an act the origin and development of which are so different from the consequences of some act being executed through a period of time in violation of an inter- national obligation. Notwithstanding these considerations, it would not be, properly speaking, an artifice; but rather a juridical construction, or, in other words, a process of legal reasoning similar to the one which estab- lishes the legal entity in order to arrive at conclusions that will permit the administration of justice. In municipal law responsibility has a practical tendency, inasmuch as the relations of man require that his interests be duly guaranteed and protected. In order to maintain these interests in proper equilibrium, it is necessary that in disposing of the patrimony it should be distributed among the individuals who bear relation to one another, either through family ties, business connection, or membership in the same community. The activities of man, either with his capital or with his labor, are complementary elements of the same economic system. Those who act in the capacity of agents of a community are to be deemed the instruments thereof, and the community should bear the injurious consequences incident to every transaction within the range of its activities. These very same principles should be applied by international law whenever the relationship between principal and agent has been properly established. However, the present individualistic tendency in the Law of Nations does not, for the time being, permit the absolute exclusion of certain cases in which every State should assume a defensive position, based on the fact that it has not been a party to the injury, or that it was not in a position to prevent it, in spite of having taken every reason- able precaution and exercised due diligence to avoid it. It is the task of the law to gradually incorporate the various juridical tendencies arising out of the necessities of the administration of justice. While the smaller States can shield themselves against abusive force by pleading their innocence in the cause of certain injuries, the future balance 2 RESPONSIBILITY OF STATES of the civilization of the States and the development of their security will promote a corresponding expansion of the Law of Nations, commensurate with the present evolution of the municipal jurisprudence; and responsi- bility will then be founded upon a more practical basis, in order to achieve in the end, throughout the world, the assumption of inter-State risks. The main reason for the expansion of international law along these lines, is the great disparity between municipal and international law. The evolu- tion of the law along these lines should be uniform. The blunders of public organs should be governed by the same principles, both within the State and among the States. At this time, of course, this problem is in a state of evolution, and it could not very well be rendered into code form with radical solutions. The authorities are divided on this point, and it has been only just recently that the trend of international usage has gradually dis- sipated the former extremely subjective doctrine. Also, there are certain re- lationships in which responsibility arises entirely independent from every subjective element. There are certain acts which cannot very well be classed as acts of the State, but quite properly similar to them, on account of having been performed by its agents while exceeding their legal authority, or improperly using their office or the means thereof ; and these cases are deemed to entail objective responsibility, inasmuch as the preservation of peace among the nations of the world requires such guaranty from the State. This is the view adopted by some of the authorities. Others recognize responsibility only in cases of negligence in general, or certain of its forms. Finally, other authorities deem that the essence of international obligations, which are merely rules of international conduct, imply the conception of sulpability in their breach, and makes its separate consideration utterly im- material. These various views tend to show that the international sphere is at present in a stage of evolution which demands the utmost tact in the task of rendering its juridical principles into code form. TTI MUNICIPAL LEGISLATION (a) The cases of responsibility arising out of legislative enactments are probably the most notorious ones, because they relate to the loftiest task of State sovereignty. The powers of the constituted authority and the regular legislative functions of the government are directly derived from the will of the people, and are the genuine expression of the latter’s wishes. For quite a long time States have guarded with considerable zeal their freedom in this branch of their sovereignty, and this is precisely the cause of the difficulties being encountered at this time in the organization of the International Community, the existence and development of which are de- pendent upon the submission of the various governments to its jurisdiction. The fact is, however, that the current juridical mind of the world has come to realize the necessity to limit all the expressions of the State’s sovereignty, comprising therewith even the legislative powers. The States, of course, preserve their right to legislate perfectly intact. They have and exercise jurisdiction, in so far as their laws carry full force and effect, and demand the faithful compliance therewith by its organs and by the inhabitants of its territory. The right to legislate may, however, be limited on certain occasions in respect of particular matters by public treaties,! or influenced along certain lines on account of some obligation undertaken by the State sither to establish or to preserve a special right. At the same time, although the State enjoys the free and full exercise of its jurisdiction over its domain, this might give rise to responsibility on its part whenever the laws enacted are contrary to international obligations. Consequently, there are municipal “In the case of the peace treaties made after the European War, which have limited the legislative powers of certain States. . . "As an example of this case, the International Convention of September 17, 1878, may be cited. This refers to the campaign waged against phylloxera and obligates the States to complete their legislation, in view of certain results. . The laws enacted by Switzerland pursuant to the Paris Convention of March zo, 1883, for the protection of industrial property, undertook the task of providing legisla- live regulations for the protection of the rights of foreign inventors, etc. The legisla- tive powers of the Confederacy, however, did not include this matter at that time, and it was necessary to amplify them by an amendment to Article 64 of the Federal Con- stitution. 24 RESPONSIBILITY OF STATES laws which are also binding in international circles, and others which entail responsibility due to their breach of international principles. The cases in which the State undertakes the obligation to establish and maintain special rights differ from the regular functions of the government to pro- vide for the organization of its various branches, or the enactment of laws to adopt certain measures, or preparatory to the exercise of its powers, or the discharge of obligations contracted with the other States. These laws place the State in a better position, anticipating the propriety of its inter- national conduct. The failure to enact these laws, or their repeal after being in force, however, do not involve responsibility. This arises as a rule from the acts of the State, irrespective of whether or not they are due to lack of proper legislation. Also, a municipal law is implicitly essen- tial whenever the obligation imposed upon the State cannot be discharged xcept in the form of a law,! or without the sanction of legal provisions.? The municipal laws may be contrary to the international law, either because they have been enacted in the face of an obligation not to legislate on the subject, or because such laws contain provisions whereby the organs of the State are compelled to act in violation in international usage. In such cases it is not the municipal law itself which gives rise to the responsi- sility of the State, but the acts of the State agents. = “Municipal laws”— according to the Permanent World Court—*“‘are simply the expressions of t“As an exception, it must be admitted that where, by definition, the obligation placed upon the State cannot be executed except through the enactment of a law, then the convention considers it is unnecessary to refer specifically to this point. As all subjective rights and duties cannot be enforced except by a positive enactment, and in the case of modern treaties dealing with the establishment and practice of professions, copyrights, etc, the purpose is to afford proper mutual guaranties to the nationals of he various States by means of public and private laws, the promise to give them such rights usually already carries with it the obligation to enact or maintain the positive aw which will establish such rights. Finally, the State is always compelled to enact ‘aws because, under the principles of its own municipal jurisprudence, whenever it has an act to perform or a contract to execute, this cannot be accomplished except by the authorization of a law. When a State, by virtue of an international convention, must issue orders to authorities or individuals, it cannot do so in the immense majority of cases, except by means of a law, and not through an ‘administrative act’ or a decree.” (Rechtsverfiigung) Triepel, Rapports du droit international avec le droit interne, p. 298. '“The State enacts the law in this instance, because without same, it would not be, in accordance with its municipal jurisprudence, in a position to fulfil its international Juties—as, for instance, the duty to punish—either because without the enactment of a State law an act ordered by the Law of Nations could not be performed, or else be- cause without the State law, an act forbidden by international law could not be omitted. Therefore, it is not the international law which compels the legislature to act, but the municipal jurisprudence itself. When there are rights ordered to be immediately established, the act which the international law requires the State to perform is the anactment of the law creating such right, and thus the State places itself, as regards its own jurisprudence and by reason of such new enactment, in a position to execute an act ordered by international law. Heretofore the failure to legislate or the repeal of laws in force was already in itself contrary to the law; but now the violation con- sists in the fact that the State has either failed to perform the act that the law re- juires, or that it has performed an act which the law forbids.” (Triepel. Rapports du iroit international avec le droit interne, p. 200.) MUNICIPAL LEGISLATION 15 the will and activities of the State, and they are of the same character as court decisions or administrative measures.” (Cour Permanente de Justice [nternationale, Arret No. 7 du 23 mai 1906. Publications, série A, No. 7, p. 19.) (b) This question of responsibility arising from the acts of the legis- lative body comprises all of the more or less important issues which have come up at this time in connection with lands and mineral resources. The laws relating to title to property and oil reserves have originated, both in Europe and in America, very important international controversies. At this time it might be well to mention the discussion between the United States and Mexico, arising out of the Mexican Constitution of 1917,! the litigation between Hungary and Roumania pertaining to agrarian interests? and the discussion between the United States and Japan in connection with the real property laws of the State of California.? Soviet legislation is another great problem which involves, not only the conflict of municipal legislative acts, but the inconsistencies of two systems of government which could not axist within the same civilization. « Article 27 of this Constitution reserves to Mexican citizens, either by birth or naturalization, and to Mexican corporations, the right to acquire land, waters and their afffuents, and concessions for the exploitation of mines, water power or mineral fuel reserves. Several of the laws enacted for the regulation of this Constitutional provi- sion gave rise to claims from the Government of the United States, based on the con- tention that rights acquired prior to the Constitution of 1917 and prior to the enact- ment of said laws, would be greatly impaired if not totally destroyed thereby. In this ~onnection, the foreign offices of both governments exchanged lengthy and very interest- ing correspondence. The Mexican Government maintained that the exercise of sover- eignty over its territory fully justified its legislation, and denied that it impaired in any way the rights already acquired by aliens; while the United States contended, on its part, that this legislation violated international laws because it disregarded, by actual confiscation of property, the rights already acquired by foreign subjects. (Official correspondence exchanged between the governments of the United States and Mexico in connection with the laws regulating Section 1 of Article 27 of the Mexican Consti- tution.—Mexico—Foreign Relations Press—1926.) * This question covered the expropriations by the Roumanian Government, in pursu- ance of its agrarian law, to the detriment of Hungarian nationals, both with and with- out options, who were land owners of Transylvania and other sections of the former Kingdom of Austria-Hungary annexed under the Treaty of Trianon. (L’Arret du Janvier 1927 du T. A. M. Roumano-Hongrois dans les Affaires. Dites Agraires et le Droit International, par Georges Scelle.) "The legislature of the State of California passed a law in connection with the rights, privileges and restrictions applying to alien nationals and to certain companies, firms and corporations in respect of property within the State, and stipulated the lapse of title thereto under certain circumstances. The law provided that all foreigners eli- gible for citizenship under the laws of the United States could acquire, hold, use, trans- fer and inherit real estate in like manner and form as American citizens. Other aliens would be entitled to these rights in the manner and form established by treaties made with their respective governments. Japan objected to this law, claiming that it im- paired the rights and privileges afforded to its citizens by the commercial and maritime treaties in force. Also, Japan rejected the suggestion to have the matter referred to the courts in charge of determining whether treaty provisions are to supersede laws enacted contrary to them. The correspondence relating to this incident is very interest- ing from the point of view of the relationship between the international and the municipal law. RESPONSIBILITY OF STATES In all of these acts of government control or of monopoly, there is no well defined limit between the municipal and the international jurisdiction. The principles of the doctrine of vested rights are very uncertain. Moreover, it would not be known how to apply limits to retroactive provisions. The modern tendency of society is to amend the old theory which invested the law with extremely individualistic nature. The main laws are now deemed to be mere regulations for the attainment of the ends of society. The guid- ance of these enactments by the spirit of justice is, of course, the only motive that should be ever present, and to which every tendency of the ‘aw should be duly subjected. However, it has to be admitted that this entire issue is still in a state of evolution. It would not be possible to establish definite rules to cover all of the problems which modern society has to meet in the development of its economic life. In this case, as in other phases of responsibility, it is imperative that the task of codification should be confined to tracing the general lines within which international jurisprudence may gradually accomplish its work of compilation. The results of the inquiry of the Preparatory Committee of the Codification Conference justify this view. As regards the question of rights acquired by alien nationals, the replies of the various governments would seem to indicate that the subject is not yet quite ripe. The Government of South Africa subordinates the notion of acquired rights to the municipal law, and in this respect it does not recognize the alleged international responsibility of the State. The Government of Austria feels rather inclined to evade the solu- tion of these “vexatious problems”. The Government of Great Britain states that it is not known just precisely what status “acquired rights” should have. The Government of Switzerland believes that it would be of great interest to arrive at a satisfactory definition of acquired rights and their imitations. It maintains further that these rights are not absolute, and that the exercise of same beyond the limits established by the municipal law, is inadmissible. There is, however, a strong tendency to construe expropriation without Indemnity as being contrary to the common law of Nations, even though there should be no special convention on the subject. Among the important recent applications of this doctrine may be cited the decisions of the Per- manent Court of Arbitration of September 24, 1920, and October 1 3, 1922, the first dealing with the confiscation of property belonging to the eccle- siastical corporations of Portugal, and the second in connection with the requisition of vessels under construction in American shipyards for account of Norwegian nationals. The law on this point is more specifically covered by Ruling No. 6 and Decision No. 7 of the Permanent World Court: the former deals with the rights acquired by German settlers in Poland, and the applica- don of the Polish law of July 14, 1920. The Court ruled that the legal MUNICIPAL LEGISLATION 17 position assumed by the Polish Government was not in accordance with its international obligations. Decision No. 7 concerning German interests in the Polish Upper Silesia involves, among other legal questions, a case of responsibility for acts of the legislative body. The issue to be decided was whether the Polish law of July 14, 1920, which was made applicable to Upper Silesia by the law of June 6, 1922, contained provisions contrary to the Geneva Treaty. (c) Treaty authorities have usually cited in cases of legislative respon- sibility the claim of Canevero against the Peruvian Government. In this case the parties discussed the legal status of alien subjects in relation to that of native citizens. The question was raised by a Peruvian law order- ing the payment of a debt to alien subjects with bonds of a domestic issue, while the claimants demanded payment in cash. The Court did not pass upon the validity of the municipal law. Among the cases involving legisla- tive responsibility, there is also usually cited the decision of The Hague Permanent Court of Arbitration in the Dreyfus matter. The question arose out of the decrees of a de facto Government, which had controlled all the proceedings in the litigation between Dreyfus Hermanos y Compafiia and the Peruvian Government. A Peruvian law had declared null and void all the acts of the de facto Government. The Court ruled that that law could not apply to bona fide transactions of alien nationals. This decision deals with the question of supremacy of the international over the municipal law, and the international consequences of the acts of de facto Governments.2 “Another sort of case is the one which arose out of Article 61, Section 2, of the Constitution of the German Republic of August 11, 1919, which pro- vided for the representation of Austria in the Reichstag on account of her ‘having been allied with the German Empire’, and at the same time, gave the representatives of Austria voice in an advisory capacity. The Allied and Associated Powers protested against this provision and demanded its repeal, maintaining that it was contrary to Article 8 of the Treaty of Versailles, which stipulates: ‘Germany recognizes and will faithfully respect the inde- pedence of Austria within the boundaries to be fixed by freaty between this State and the principal Allied and Associated Powers; she further recognizes that such independence will be inalienable, unless otherwise determined by the Council of the League of Nations’. Without disputing in the least the principle in question, the German Government contended at first that the law was not inconsistent with the Treaty; however, afterwards it consented to sign a statement which renders the admission of Austrian representatives to the Reichstag subject to a change in the international juridical status of Austria. to be approved by the Council of the League of Nations.” ? % B rnard de Fr ancqueville, L’ceuvre de { X 1 i . € a Cou Pe manente de Justice International Foye 11, . R = yn 1 . : 1 7 eC ler 1CO Elguer a. €sena Hist6r ca de 0s Arbitrajes de I eru. RESPONSIBILITY OF STATES Another important decision worthy of consideration is the one of the Claims Commission, United States and Mexico, rendered in 1926. In one of its most interesting rulings dealing with the responsibility arising out of a homicide that may have been justified by the military regulations of the United States in force, the Commission declared that the principles of the Law of Nations in reference to the protection of human life prevailed over the provisions of the municipal law.! This is probably the clearest and most specific case in which this principle of natural justice has been adopted as a practical rule of international conduct. The Commission upheld this principle as against the municipal law and established in a practical way the manner in which the State incurs responsibility through imperfect legislation.2 * Claims Commission, United States and Mexico—Opinions of Commissioners— February 4, 1926—July 23, 1927—Washington, 1927. “In this issue of legislative responsibility, there are many other relevant cases among which the following may be cited: 1. The cases arising out of the Italian law of 1912 in connection with the State monopoly of the life insurance business and the Uruguayan legislative sanction in re the same subject. 2. The Montiji case (Moore 1440), in which the Arbitrator upheld the treaty as against the Constitution. (The laws of the Republic should conform to the provisions of the Treaty, and not the Treaty to the provisions of the law.) 3. The Baldwin case (Ralston 102), in which the Arbitrator upheld the municipal laws in so far as they were not in conflict with the general established principles of the Law of Nations. 4. The Massiani case of the Claims Commission, France and Venezuela (Ralston 103), wherein the Arbitrator up- held the laws of Venezuela, which did not embody any particular offence but, on the tontrary, were, in general, in full accord with the Law of Nations. 5 The Creole case {Ralston 104). I= MEDIATE AND IMMEDIATE STATE RESPONSIBILITY (a) The cases of responsibility arising out of the acts or omissions of governmental organs and public officials are, of course, the most numerous in international jurisprudence. There are considerable differences in the practices of the various governments and in the decisions of the arbitrators and mixed claims commissions. It would be well to consider: first, cases involving responsibility for acts of competent officials who have discharged their duties in pursuance of the law; or have exceded their authority; or in any way infringed the provisions of the municipal law to the detriment of alien subjects; second, acts which are not within the scope of official duty, but personal acts which involve, therefore, merely personal responsibility of the officer under the municipal law; third, cases of the same nature as the last mentioned ones, but which, by their characteristics or apparent relation- ship to the functions of public office, may be similar, under certain circum- stances, to public acts proper; fourth, cases in which there is no bad faith on the part of the government officials, or in respect of which the national authorities have adopted proper measures, and the State is thus relieved of all responsibility ; and fifth, finally, all cases of common responsibility which assume international character through the fault of the State or denial of administrative justice. (b) Responsibility might also arise directly between two States. These cases come up, for instance, in territorial encroachments; or violation of treaty provisions; or disregard for the rights of a neutral State; or lack of due respect to diplomatic organs; and, generally speaking, in all cases in which the injury has not been inflicted upon individuals, but upon the foreign community as an entity, or in its national character as a member of the Family of Nations. International jurisprudence has, indeed, numerous cases involving this type of responsibility, which is termed “immediate responsibility”, because the facts upon which it is based establish, at the onset, a question between two powers. A distinction has to be drawn, how- ever, between immediate and objective responsibility. It does not arise out of all injurious acts. There are instances in international procedure in 20) RESPONSIBILITY OF STATES which the facts have been submitted to investigation in order to establish their truth, their nature, and to fix responsibility therefor. The last case which may be cited as an example is the boundary controversy between Bolivia and Paraguay. Both States were claiming for encroachments upon their territorial sovereignty. A Commission was appointed to fix the re- sponsibility.! The same thing occurred in the incident of the Dogger Bank. But, under ordinary circumstances, the facts have been considered sufficient in themselves to impute to the State responsibility for the acts of its agents or officials, as in the case of the violation of the Brazilian sovereignty by the seamen of the Panther. The distinction between the two situations does not lie in the character of the agents blamed, but in the nature of the alleged acts and their juridical import. However, both cases cover agents or officials, irrespective of their category, who, due to the circum- stances under which they are acting, are deemed to represent the State as an international entity and involve its responsibility, whether they have acted within the range of their authority, or have exceeded same, or otherwise violated the laws of their own country. (c) Among the acts which might involve responsibility, are the uni- iateral or bilateral declarations of will of the competent authorities. These are: the Chief Executive of the Nation, the Ministers of State, the Congress itself as regards its power to authorize or approve treaties, and diplomatic representatives in charge of their negotiations under instructions from their governments. © The declarations of will of these various organs, in general, * This incident took .place shortly after a Conference of all the American Republics had met in Washington to adopt two conventions on conciliation and arbitration. The Conference tendered its good offices to Bolivia and Paraguay, and both Republics accepted. As a result of these good offices, which were exercised through a Special Commission, the two Republics signed a Protocol on January 3, 1929. The pertinent articles of this Protocol are of the following tenor: “The Governments of Bolivia and Paraguay agree upon the following stipulations: First. To organize a Commission of Investigation and Conciliation which shall be composed as follows: (a) Two dele- gates each from the Governments of Bolivia and Paraguay, and (b) one delegate appointed by the Governments of each of the following five American Republics : United States of America, Mexico, Colombia, Uruguay and Cuba, Second. The Commission of Investigation and Conciliation shall undertake to investigate, by hearing both sides, what has taken place, taking into consideration the allegations set forth by soth parties, and determining in the end which of the parties has brought about a change in the peaceful relations between the two countries. Article Six. The Com- mission is empowered, in case it should not be able to effect conciliation, to establish both the truth of the matter investigated and the responsibilities which, in accordance with international law, may appear as a result of its investigation. Article Ten. The high contracting parties reiterate their firm purpose of having said controversy settled, in Any event, by juridical means and in perfect peace and friendship between the two countries. The Commission has performed its task very efficiently, having brought about a reconciliation. It has also made efforts to settle the territorial controversy between the two interested Republics and, at this moment, the good offices of the five Republics represented in the Commission are still being exercised through their diplomatic organs, with very good prospects of obtaining successful recultc MEDIATE AND IMMEDIATE STATE RESPONSIBILITY 21 bind the State, without the necessity of ascertaining the source of the municipal law which renders them competent. However, in so far as public treaties are concerned, some of the authorities hold that they are to be considered as acts of special import which require, precisely, the fulfilment of constitutional regulations on the subject. This is a very much debated point. Treaty authorities have stated a series of considerations on the autonomy of the international juridical system, or on the supremacy of the international over the municipal law.! The peculiar handling of this matter and the lengthy debates it has caused, do not seem warranted. An analysis of the actual facts will disclose that the procedure for entering into treaties is now so regulated in the civilized States, that it is a co- operative task of the various branches of the government: the Chief Execu- tive cannot act without the assistance of the Minister; the Minister, on his part, enlists the support of the majority party in Congress, and acts in accordance with the expressed will of this body, or under authority already obtained to negotiate along certain lines only, or subject to a vote a posteriori sanctioning the treaty. This is the usual procedure. States negotiate and make treaties with the understanding that they are subject to this procedure, which is the only one that can eventually give them the actual force and effect of a pact, sanctioned by the will of the Nation. If this is the pro- cedure that is being followed every day, then it constitutes a common usage. Treaty authorities, however, are anxiously seeking a solution for this prob- lem, which, incidentally, they cannot find; whereas, the real solution lies in the procedure herein outlined, covering the ground more thoroughly than any other suggested principles, since it is being followed out in the large number of international covenants that are constantly being made. (d) Mediate responsibility is involved in all cases in which the question is not between two States, but an injury caused by the officers of one State to the nationals of another. From the point of view of responsibility, there *“To state that the power to establish who is to be the competent authority to make treaties is necessarily within the scope of constitutional law and that therefore it is exclusively incumbent upon such law to fix the conditions under which the will of the State to make a treaty can properly originate, would amount to saying that the con- stitutional provisions have authority in the domain of international law proper; in other words, that international law is not an independent system of jurisprudence. It would not be otherwise if the doctrine is understood in the sense that it is incumbent upon international law to invest the State with the will to make treaties, which, how- aver, cannot but imply the will, and only the will of the competent organ in accordance with the constitutional law. To state that international law is thus dependent upon sonstitutional law does not seem to be legally conceivable. On the contrary, it is con- ceivable that international law delegates to municipal law the power to establish that the leclaration of the will to make a treaty is attributable to the State if the measure creat- ing it emanates from the competent organ under the constitutional provisions. Con- stitutional competency would thus imply, in accordance with international jurisprudence, the presumption that the international rules upon which the attribution of such will lepend, are applicable.” Anzilotti—Cours de Droit International—Paris—1020. D. 262. ) J RESPONSIBILITY OF STATES is no practical reason for the classification of State agents into principals and subordinates. Those who have brought up this classification, place in the first rank the representative authorities, such as the Chief Executive of the Nation and his Ministers. The purpose of the classification is to impute to the State responsibility for the acts or omissions of high government officials. The action of petty agents or employees would not, fundamentally speaking, give rise to responsibility. This would be established, eventually, in cases in which the injured party would have no means available for legal redress, or in which the State should fail to apply proper disciplinary measures to the delinquent subordinate officer. This is the doctrine propounded by the oldest treaty authorities, who specifically set forth a series of severe disciplinary measures to be applied in cases of responsibility for the acts of subordinate officers. The doctrine of the Harvard School adheres to these same principles. This school recognizes responsibility in respect of the acts of high government officials in pursuance of the functions of their office, if no legal remedy can be had; and of petty officers and employees in the course of their duties in cases where there has been a denial of justice, or in which the Government has failed to apply proper disciplinary measures. The views of the various governments in their reply to the inquiry of the Preparatory Committee of the Codification Conference make no mention of the classification of State organs or officials. It is not possible to state, nowever, that a standard and definite procedure may be noted in going through the decisions. There are some arbitral awards which have fixed responsibility upon the State in connection with the acts of its sub- ordinate officers. FHowever, generally speaking, it may be stated that arbi- tral awards, especially in cases involving the United States of America and the Latin American Republics, have set forth that the action of subordinate officers should be prosecuted in the national courts. Only in cases of a denial of justice would they assume international import. It is contended that it would seem unfair to hold the State internationally responsible for the acts of its employees, who it is physically impossible to maintain under ‘he constant supervision of their superiors. Assuming that a regular system of government organization and supervision is in force, together with effi- cient disciplinary regulations, the administrative acts of the employees should be subject only to the legal remedies available to the parties concerned in order to secure proper redress for their injuries. But it has been claimed, on the other hand, that the numerous arbitral awards which have relieved the State from responsibility on account of the action of its employees, have not been prompted by the rank of the culprits, but by the fact that the claimants had not exhausted their legal means to secure redress. From this point of view, the decisions should not be construed in the sense that they do not recognize international responsibility in these cases. but rather that MEDIATE AND IMMEDIATE STATE RESPONSIBILITY 23 the exhaustion of the legal remedies available within the municipal judiciary is a condition precedent to international cognizance. There is not, in fact, any proper reason to apply different principles of law, depending upon the rank of the officers of the State. Neither would there be a good reason to base this distinction upon the fact that redress for the damage may be had through prosecution of the legal actions provided by the State for the protection of the rights of the inhabitants of its ter- ritory. These actions are, in general, available to all persons in connection with damages caused by all kinds of agents. Certain special cases in which the State disclaims responsibility, shielding itself behind the ancient con- ception of its powers as a body politic involve, in fact, immediate inter- national responsibility, as they imply a veritable denial of justice. Therefore, logically speaking, any classification made of the acts of government officials as regards the international responsibility of the State therefor, would have to be based exclusively upon the nature of the acts proper and the legal position assumed by the State in the matter, in relation to other States or their nationals. It is thus the nature of the act, which should establish whether it comes properly within the national or the international jurisdiction. Reference has been hereinbefore made to national or private matters, which come properly within the municipal jurisdiction. However, there are certain matters which involve principles of international law, or which affect the conduct or obligations of the Family of Nations and are, therefore, beyond the jurisdiction of the municipal judiciary. Any facts in controversy in this kind of litigations, or the responsibility involved, could not be properly adjudged through an ex parte proceeding of any one of the States con- cerned, as equity would demand a superior jurisdiction to establish the truth of the facts and do justice. Some of these issues, however, may be properly settled through proceedings in the municipal organs, and, no doubt, it would be only fair, under certain circumstances, to afford the State an opportunity to do so. However, this is a matter involving rules of equity and comity, and under strict legal principles, all questions which are prim- arily international in scope, or which assume such character by reason of not being actionable under the municipal jurisprudence, entail international re- sponsibility, whether they involve superior officers or subordinate agents or employees. The damage inflicted by one State upon another, already dealt with, belongs to the first category, the same as municipal laws which violate international principles, enacted by States wherein unconstitutionality cannot void them. In all other cases in which the States have afforded private citizens the right to sue high government officials, there is no distinc. tion to be drawn, from the point of view of responsibility, between the acts of the latter and of subordinate officers or petty employees. They both J RESPONSIBILITY OF STATES have the same duties with respect to private citizens, and it is incumbent upon the State to afford the rights of the latter proper protection against the injustice and encroachments of either rank. This would be a truly logical and equitable solution. (e) In connection with these acts of subordinate agents, special con- sideration has been given in certain cases to damages caused through violence on the part of incompetent armed forces! When they are acting under orders of their superiors, their conduct belongs under the same category as the usual acts which involve the responsibility of the State. There are certain other instances, however, in which soldiers may inflict damage with- out the authority, or while not being under the control of their superiors, either through the use of the means at their disposal, or through the exercise of apparent authority. It is maintained also that it is not essential that the acts of soldiers should have been executed in their military capacity, or that they should or not be within the scope of their functions.2 Respon- sibility should be absolute and unqualified, as provided by Article III of the Fourth Hague Convention of 1907, which states that “the belligerent power shall be responsible for all the acts committed by persons who form part of its armed forces”, (f) The task accomplished by the Preparatory Committee of the Codifi- cation Conference leads to believe that it is possible to attain the codification of this question of responsibility for administrative acts. Practically all the States consulted have stated uniform views. Tt might be mentioned that the Government of Great Britain affirms the principle of responsibility for loss or damage caused by the acts or omissions of officials within the range of their authority, but which are contrary to the international obligations of the State, or to its municipal laws, or which may be considered as having been anticipated by such laws? However, this last phrase relating to !Even though damages caused by armed forces are, in fact, of an unusual char- acter, there is no proper technical ground to place them in a class by themselves. The Institute of International Law considers that the action of military officers should be governed by the same general principles involving the conduct of government officials and agents. *4It is immaterial whether the delinquent has or not availed himself of his military capacity; in fact, the reason why he was able to commit the act was the power that he always has while he is a soldier (or an officer). It is likewise immaterial whether or not the act is within the range of his military functions; moreover, in certain cases the act is utterly inconsistent with military duties (rape and arson) ; and responsibility also exists because such acts show, either wrongful negligence (criminal negligence if it is willful) on the part of the superior officers, or at least, lack of proper discipline and supervision. The wrongful act was committed by the soldier or officer by virtue of the powers that the State has placed in their hands, and the State is responsible for the improper use of such powers which it has entrusted to them, and which it should always keep under proper control.” (Observations de M. le Fur—Annuaire de L’Instie tut de Droit International, Tome I, 1027, p. 514.) #“The State is responsible internationally for the acts or omissions of its officials acting within the limits of their authority. If a foreigner suffers loss or injury from MEDIATE AND IMMEDIATE STATE RESPONSIBILITY 25 municipal laws, brings up, as may be clearly noted, an element which is entirely irrelevant to the proper conception of international responsibility, inasmuch as it is evident that any violation of the municipal law which bears no connection with international conduct, is immaterial from the point of view of international responsibility. As regards official acts beyond the scope of the officers’ authority, there is a great majority of the governments which uphold State responsibility. Norway, however, holds to the ancient doctrine which established certain conditions specifically set forth before the State could be held responsible for damage caused by incompetent agents.! Holland, too, does not recognize conclusively or without reservation the responsibility of the State in this regard, even though the incompetent officer should have availed himself of his official investure.? Responsibility under such circumstances has also been denied by Poland.? Finally, Czechoslovakia has adopted a less radical view, upholding responsibility even when the incompetency of the officer is un- known, but denying it when the official function served merely as an excuse for the wrongful act. (g) This administrative responsibility of the State covers all the in- jurious acts of its constituent political subdivisions, and in political con- federations, also those of each one of the federal states. In cases of private or independent entities, there is nothing to be added, inasmuch as they are any such acts or omissions which are contrary to the international obligations of the State, or to its municipal law, or amount to negligence under that law, the State is hound to make reparation. If effective means of redress are provided in the courts, they must first be exhausted (see answer to point XII). The same rules apply to loss or injury caused on the sea as on land.” ! “We presume that international responsibility will be involved in this case if the State has failed to prevent the act in question although it might have done so, for if the State has neglected to take against the official in question the steps prescribed under its laws, or, again, if the State has not allowed the foreigner in question to take his case to court and proceed with it there.” "“The fact that the official, though acting in his public capacity, has exceeded his zompetence should not be conclusive.” *“If, however, the act of the official is only contrary to the law of the country or if it is in the nature of an omission, the risk of such an act—which is regular in form— falls exclusively on the person concerned, and the State does not incur international responsibility. The acts of Government officials acting in their public capacity, but sxceeding their authority, do not involve the responsibility of the State under municipal law nor do they constitute grounds for international responsibility. The acts of a Government official exceeding his official authority are not acts of the State considered as a juridical person. Responsibility might be allowed in exceptional cases, as provided in clause 4 of the Conclusions of the Committee of Experts.” *“An act exceeding the powers granted, where the exercise of the public authority entrusted to an official of the internal administration or to a diplomatic or consular agent merely furnished the occasion for the act in question, cannot be held to constitute the exercise of a function for which the state must be held responsible. Acts of this kind are merely private acts, and must be dealt with as provided in VII (b), (¢) and (d). On the other hand, mere orders of the internal administration restricting the official’s powers cannot absolve the State from responsibility if the powers are not ex- ternally (juridically) defined.” £ >= RESPONSIBILITY OF STATES subject to the same principles governing responsibility for the acts of private citizens. However, as regards official communities, counties, or other political subdivisions which exercise public functions, their acts might be construed as acts of the State proper which, by reason of national organization, have been delegated to local authorities. In these cases international responsibility is based upon the same general principles applying to State organs.! If the acts are within the range of the local activities of the community or other political subdivision, the State is responsible for them, although they do not bear in fact the characteristics of State acts. The real foundation for this principle lies on the fact that the State should become reconciled to the view that all public acts within its jurisdiction, included in the sphere of action of its legislative and executive organs, and by whomsoever performed, are to be deemed in international circles as acts of the State itself. That which the State itself is not permitted to do under international law, can aeither be performed by its constituent or subordinate entities. Should they do it, the State is to be held responsible therefor.2 (h) Responsibility in the case of federated governments for the acts of the various constituent entities is termed indirect responsibility, because it is averred that the State becomes liable for the acts of others. This, how- ever, is true only in part. Direct responsibility is involved in the case of federated governments when one of the member States violates the obli- gations undertaken by the Federal Union, or when it fails to perform its duties or do the necessary for the discharge of such obligations. The acts or omissions of political subdivisions are immaterial as far as international law is concerned. International duties are imposed exclusively upon the Union itself, which, in its collective capacity, represents the entire Nation in the international sphere. A distinction has to be drawn, however, between the responsibility of the federal subdivision or its duty to indemnify for inju- ries inflicted, or violation of the international law, and the position of the federal government when it has to take cognizance of claims for the indi- vidual obligations of the member states and make allowance therefor. This is the position which involves what jurists have termed indirect responsi- bility. On the other hand, if it is a confederacy in which the federal states retain certain international character, each member is individually responsible. * “When in this connection the community executes acts which, if performed by the State itself would be contrary to the Law of Nations, the State becomes immediately responsible therefor to the foreign State thereby injured, inasmuch as such acts of the community are, for all practical purposes, ‘acts of the State’. Moreover, the damage sustained by the foreign State is due to an act which, in a centralized form of govern- ment, amounts to a formal act of the State. Undoubtedly the State cannot, by de- centralizing its organs, avoid responsibility for acts that are, in fact, acts of the State Soa (Triepel—Rapports du droit international avec le droit interne—p. 354.) 1.07 MEDIATE AND IMMEDIATE STATE RESPONSIBILITY 27 This responsibility, however, can only be fixed through the medium of the central government, which represents the entire Union. There may be found in international history various instances of direct and indirect responsibility of federal governments, and it has been no easy task to achieve the ad- mission of federal responsibility for the infringements of the member states. In several cases federal governments, while not disclaiming responsibility, have pleaded their inability to discharge international obligations due to the lack of legal means to compel fulfilment on the part of its constituent political units. In other cases, like the Luis Stern matter, the central government has gone so far as to refuse a lmine to discuss the judicial organization of a particular State. Other well known leading cases are the McLeod between England and the United States; the California Schools, between Japan and the United States; and the New Orleans and Hahnville, Louisiana, lynchings, which caused differences between the United States and Italy, etc. In all of these various controversies, the governments have been reluctant to accept full federal responsibility ; but, in the end, it has been admitted. In the last mentioned case, the acceptance of responsibility was solemn and definite. The experience gained from these incidents leads to the conclusion that it is a recognized principle of international law that the federated State should be responsible for the violation of the international obligations of the Union by its constituent members, and also for the infringement of the latter’s own international duties, It is not permissible to set up the national organization of the government as an excuse for the failure to discharge such obligations. This question was brought up in the inquiry of the Preparatory Committee of the Codification Conference. The replies of the various governments were all based on the assumption that responsibility arises out of the fact that the entity which conducts the foreign relations is the proper one to undertake international obligations. The replies on this point refer also to the position of subordinate states, colonies, protectorates, etc., for the acts of which the controlling State should be responsible. Among the Bases of Dis- cussion of the Codification inquiry, No. 23 reads as follows: “Where a State is entrusted with the conduct of the foreign relations of another political unit, the responsibility for damage suffered by foreigners on the territory of the latter belongs to such State. When one Government is entrusted with the conduct of the foreign relations of several States, the responsibility for damage suffered by foreigners on the territory of such States belongs to such common or central Government.” This Basis of Discussion does not appear to be technically adequate. The conduct of foreign relations is sometimes divided in a certain way. There are instances in which the states of a federation retain the right to enter into treaties upon specific matters, and to have diplomatic representation. This was the case with the German Federated Empire prior to the World War of RESPONSIBILITY OF STATES 1914, and this is presently the case with the British Empire, the dominions of which have the right to enter into treaties. All of the British dominions signed the Treaty of Versailles and form part of the League of Nations. This mere fact of international association, which involves a series of rights and obligations, implies a certain element of responsibility which could not very well be altogether disregarded. In the domain of foreign affairs, the self-governing Dominions, with the exception of Newfoundland, are recognized as possessing an international status by the Covenant of the League of Nations. In the Assembly of that body, Great Britain, Canada, Australia, New Zealand, South Africa, the Irish Free State and India are members upon an equality with other nations of the world. They take part in the election of the judges of the Permanent Court of International Justice, and their right to sit in the Council is ad- mitted, although that right has not yet been exercised. The provisions of the report (the report of the Committee on Inter-Imperial relations of the Im- serial Conference) in this matter are of great importance, recognizing that the British Commonwealth of Nations may make a treaty as such, with a single delegation for the whole; or that each member of the Commonwealth may appoint delegates of its own; that the members, therefore, may negotiate treaties as separate contracting parties, through their delegates; or that indi- vidual members may make treaties by their plenipotentiaries, with the under- standing, however, that the intention to do so should be communicated in advance, and that before any treaties are concluded “which might involve the other Governments in any active obligations” it must “obtain their definite assent.” In view of these circumstances, it was natural that the report should state in express terms the right of each autonomous State to appoint Ministers plenipotentiary to the outside world. Ireland had already done so, with the consent of Great Britain, and immediately after the adjournment, Canada appointed its first Minister Plenipotentiary to Washington. The Government of Australia, if the press is to be believed, expressed, imme- diately upon the adjournment of the conference, its intention likewise of sending a Minister Plenipotentiary to the United States. In view of the foregoing situation, it may be stated that the mere conduct of the foreign relations is not, in itself, sufficent to establish responsibility on the part of the central government in all cases of federated states. In the usual or ancient type of confederacy, however, it is undoubtedly applic- able. And it is exclusively to this type of confederacy that the formula of the Institute of International Law refers, when dealing with the direct and indirect responsibility of the federal State in respect of the acts of the associated States. This formula, however, does not include other kinds of unions. Sir Thomas Barclay, a member of the Institute, pointed this out when he stated: “It is gratifying to note that the question of the peculiar MEDIATE AND IMMEDIATE STATE RESPONSIBILITY 29 status of the British Dominions and Colonies is implicitly reserved by the text.” However, it would not be possible to make any such reservation when preparing a formula for codification purposes. Some stipulations should be made to include federated States and other commonwealths which cannot properly be classed under the common type of confederacy. The formula set forth in Basis for Discussion No. 23 of the Preparatory Committee, pre- viously mentioned, could be construed to include: first, all protectorates, mandates and various types of subordinations among States; and second, all of the common types of confederacies, wherein a central Government under- takes the conduct of foreign relations. The deficiency of this formula lies in the fact that it confuses responsibility with representation, and that it does not depart from the idea of the control of the foreign relations. There is another defective formula,” and that is the Harvard School doctrine, which includes in the same category all the so-called political sub- divisions, and considers protectorates, colonies and dominions on the same footing, disregarding altogether their relations with the central Government under their Constitution, and takes into account merely the fact of whether they have or have not independent control of their foreign relations. The responsibility of one State for acts of another depends upon the tenor and scope of the covenants which have placed the one State under the more or less absolute control of the other. In the case of combined govern- ments, responsibility is based on the international character of the individual States. If they have such character, their responsibility is unquestionable. The fact as to whether or not each member of a commonwealth is invested with international character, depends upon the nature of the bonds which bind them together. And this bond cannot very well be defined a priori, as it is a subject for study in each concrete case. It is submitted that this is ‘he only advisable conclusion. The practical difficulty, which, at the present moment seems insurmountable, is to establish the ways and means of making responsibility effective in the case of certain combined entities. ACTS OF THE LEGISLATIVE ORGAN (a) In the Bases of Discussion of the Preparatory Committee, the damages caused by the legislative or executive organs in connection with contractual relations, or by violence or attempts of the authorities against personal liberty, are deemed to belong in a special category. It is explained that damages caused by rebellions, civil wars or riots should be given special consideration, inasmuch as the circumstances under which they are caused should have some bearing upon the proper rules applicable. This is not the case, of course, as regards imprisonment, deportation and other action usually taken against aliens. These might be either authorized acts under the municipal law, or illicit acts while performing official functions in accord- ance with such law. However, from the international point of view, these acts should be in no wise considered different from all the other acts of either competent or incompetent authorities. The rules to which they are subject are very well known. Likewise, the cases which, for special reasons involv- ing a denial of justice or extraordinary injustice, become the subject of international cognizance, as well as all the other activities of the State organs. Consequently, there is no special reason to place any of these acts in any particular group or category. To do so would establish a tendency towards class regulation, a system that is most undesirable in codification work. (b) The cases of ex comtractu responsibility are, however, different from the others mentioned, inasmuch as they involve contractual relations between the State and private individuals. There have been instances in which financial conditions have been interposed, or coercion exercised by powerful nations against their inferiors. This fact has given contractual relations between the State and private individuals special prominence in the history of international jurisprudence, and has invested them with a certain peculiar characteristic. It is for this reason that various doctrines have been advanced for the classification of these contracts, and others purport to explain why certain ones, according to the opinion of some authorities, should be excluded from the general principles that govern the obligations undertaken by the State. ACTS OF THE LEGISLATIVE ORGAN 31 The Bases of Discussion of the Preparatory Committee divide this sub- ject into two parts: one dealing with contractual relations impaired by the action of the legislative organ; and the other, with contractual relations impaired by executive action. The first question involves legislative enact- ments that are inconsistent with the terms of concessions granted to foreign subjects, or of contracts made with them; or other laws which might ob- struct the execution of such contracts or concessions. Not all of the replies of the various governments affirm the responsibility of the State on this point. The Austrian Government states that the rule of the Law of Nations requiring the States to fulfil such contracts made with aliens in like manner as they are required to discharge international obligations, does not seem to be generally recognized. The responsibility of the State should not be involved except in cases where the joint demeanor of the administrative and legislative authorities should be characterized by bad faith towards an alien, or which, due to other reasons, may differ from the usual conduct observed by civilized nations. The Belgian Government remarks that the question at bar cannot be replied in definite terms. There would be cases in which certain laws might be an obstacle to the execution of a concession granted to an alien, and yet not entail responsibility. The Danish Govern- ment believes that, excluding exceptional cases, this matter does not come within the range of public international law, but within the general doctrine covering the protection of acquired rights. The Government of Poland sets out that, a priori, it could not be affirmed in general that it would constitute an international offence to enact laws inconsistent with the obligations of the State in respect of aliens, under covenants made with, or concessions granted to, them. The Swiss Government also considers it very difficult to set forth definite rules on this subject. The amendment of concessions granted to foreigners, or of contracts made with them, by legislative enactment, could not be accomplished except for reasons of public policy and on condi- tion that the principle of legal equality of nationals and aliens alike should be duly applied. The other issue propounded by the Preparatory Committee is the repu- diation of debts by legislative action. The Government of Austria avers that the leading doctrine of the Law of Nations does not appear to consider the refusal of the State to pay its debts as a breach of its international obli- gations, and that it would not recognize any right on the part of the State whose nationals have sustained loss through repudiation to intercede on their behalf. It must be admitted that the risk involved in the acquisition of securities of a State whose financial status is uncertain has been, in the majority of cases, taken care of when fixing the subscription price or the rate of interest, The Belgian Government calls attention to internal loan securities acquired by foreigners, and points out that foreign holders should 32 RESPONSIBILITY OF STATES not be entitled to be treated differently from nationals in the application of laws made necessary by economic conditions; while Great Britain does not consider that this matter is properly comprised within the question of re- ponsibility of the State for damage caused within its territory. The phrase “repudiation of debts” is indefinite. This should imply that the action of the legislative organ is not due to inability to meet payment, but to a willful intention not to execute a contract entered into by the State. In so far as acts of the legislative organ are concerned, there would be no possibility of local means of redress. It may be that the responsibility of the State will be involved in such cases. However, the fact as to whether or not an inter- national claim is legitimate, can only be determined by a careful consideration of each particular case. Switzerland maintains that the repudiation of a debt is a distinct impairment of acquired rights. The impairment of the obligation of contracts between the State and private individuals by executive action, has been set forth in the Bases of Discussion of the Preparatory Committee in the following two points: first, acts that are inconsistent with the terms of concessions granted to foreigners or the provisions of contracts made with them, or acts that might constitute an obstacle to the execution of such contracts or concessions; and, second, repudiation of debts. The replies of most of the governments affirm the responsibility of the State. The Government of Great Britain remarked, however, that the entire question resolves itself into the non-performance of a contract made by the State with a private individual. If the matter is to be considered in this light, there would not be sufficient material to codify one single rule of international law. The mere fact that the terms of a contract entered into with a private individual have not been complied with, Joes not, by and of itself, constitute a violation of international principles: it must be shown that it is coupled with other circumstances that will also make the case appear as a failure of one State to observe its duties towards another. (¢) It is a generally recognized principle, therefore, both in theory and ‘n certain instances of international practice, that the contractual relations between the State and private individuals are of the incumbency of the local laws. The operation of contracts is subject to provisions of the laws of the State, which protect the rights of the contracting parties. Consequently, it is quite possible that a breach on the part of the State of its contractual obligations with private individuals, may have been sanctioned by the govern- ment officials bearing in mind that the injured party could claim the repara- tion provided by local laws. According to the official procedure adopted by the Government of the United States, unless the breach of a contract also constitutes a tort, it is not considered as a case of improper international conduct. However, besides the usual types of contract, and covenants cover- ACTS OF THE LEGISLATIVE ORGAN 33 ing franchises for public utility services or monopolies, or for the con- struction of public works, there are others relating to domestic and foreign loans, in other words, the public debt. It is proposed to apply special prin- ciples to this latter question. It is deemed that a national loan is not, properly speaking, a civil contract; and that, in any event, it is only a special kind of obligation: a debt of honor which the debtor State should meet if it would avoid its financial ruin and the impairment of its national credit. Such a contract, therefore, has no other binding force than the fear of the conse- quent impairment of the national credit and dishonor of the State that fails to meet its obligations. There is another doctrine, which considers govern- ment loans identical to any other form of civil contract. When the State negotiates a loan, it is not acting as the sovereign, but as any other person subject to the municipal law. Government loans, therefore, are not com- prised within the scope of State sovereignty. The obligations arising there- from should be discharged like those provided by other contracts. (d) The Calvo clause, the so-called Drago Doctrine and the Porter Convention of the Second Peace Conference at The Hague deal with this subject. The purpose of the first one is to eliminate international responsi- bility from contractual matters between the State and private individuals, leaving same to the exclusive jurisdiction of the local laws for proper redress. The second one purports to eliminate the use of coercive measures to secure payment of the principal or interest due on a loan. The third sets forth this latter provision with certain limitations, sanctioning the use of coercive measures to secure payment of contractual obligations only when the debtor State should refuse to submit the matter to arbitration, or to abide by the arbitral award. The replies of the governments lodged with the Preparatory Committee have specifically referred to the Calvo clause. All the govern- ments, with the exception of that of the Netherlands, have considered it in- appropriate. Great Britain has adopted in regard to this clause the views set forth in the recent ruling of the General Claims Commission in the case of the North American Dredging Company vs. The United Mexican States. None of the replies to the inquiry have made special reference to the Drago Doc- trine or the Porter Convention. They may be considered, however, implicitly contemplated in the replies concerning the use of reprisals. But the Govern- ment of Switzerland states that reprisals should be subject to the condition that the States should have no other peaceful means of reaction to violations against them. This condition would specifically cover the due regard for outstanding obligations which the Porter Convention provides. Basis of Discussion No. 25 of the inquiry should be amended along these lines. (e) In our estimation, however, all of these chapters covering responsi- bility in respect of contracts of every kind (including government loans) and reprisals. should be governed by other principles than those set forth in 34 RESPONSIBILITY OF STATES the Schedule of Points of the Preparatory Committee. Of course, there is no doubt but that, from the legal point of view, all contracts made by the State are equally binding. Their fulfilment is usually guaranteed by the local statutes. The States agree on these principles. They all admit that unless proper courts and legal actions are established to enforce the rights of persons who have made contracts with the State, there would be an utter denial of justice; likewise, if the decisions of the courts constitute an evi- dent and intolerable disregard of the law, it would amount to an exceptional injustice. The cases of national debt are precisely the ones wherein there are no means whatsoever for local redress, because they are covered by statutes which the local courts are compelled to enforce. They are typical cases that should be subject to international jurisdiction. There might be others covering rescission of franchises, or their unilateral amendment by virtue of local laws or administrative measures prompted by considerations of public policy, or matters of paramount national interest. These are pri- marily cases which come within the jurisdiction of the national courts, but which might eventually assume international import if no adequate redress has been obtained in the local means. And what is the significance of submitting these cases to the jurisdiction of the Law of Nations? Its meaning is that in instances wherein the State, in the exercise of its governmental functions, has committed acts impairing the obligation of contracts with private individuals, and has thereby inflicted loss or damage, it is of the exclusive incumbency of the international com- munity to determine whether such functions have been properly exercised, or whether there has been any error or impropriety in connection therewith. State sovereignty is not an inviolable majesty. Sovereignty is the com- petency of the State to govern the interests of the community. Its exercise should be guided by the duty to avoid damage to property, unless called for by moral grounds or by the best interests of the nation. In view of the equality of the States, it is only the community of States that can properly pass upon their individual conduct. The following conclusions may be drawn from these considerations: first, that contracts made by the States are subject to their local laws; secondly, that when such laws do not afford adequate remedy, or when, due to the nature of the contractual relation, there is no legal remedy available, the international community is competent to adjudicate upon the situation thereby created; thirdly, that in view of the present régime of the international community throughout the world, as evidenced by the organization of the League of Nations and of the Perma- nent Court of International Justice, as well as by the vast number of treaties on arbitration and conciliation that bind practically all the nations of the world, there is no legal possibility of reprisals on the part of States for violations against them, except in the case of very exceptional situations ACTS OF THE LEGISLATIVE ORGAN 35 wherein the evident lack of civilization and the imminent danger to the person and property of aliens, render it imperative to take special steps for the protection of the State’s nationals. These are really emergency cases in international life. And even they, at a more advanced stage of civilization, should be subject to some collective control. Beyond that, the action of the States should be confined to demand the intervention of international justice to fix responsibility and to afford reparation. Reprisals should, therefore, be altogether abolished. The substantive rules of law involving contractual responsibility should be set forth bearing in mind the principles of justice and equity, in order to properly reconcile the requirements of the best public interests of the nation with the rights and interests of the persons who have contracted with it. Such broad and general formulas as may be adopted will be rendered practical and more specific in the course of time by the decisions of international courts. v | THE ADMINISTRATION OF JUSTICE (a) The acts of the judiciary may, like those of the legislature, involve international responsibility, which is derived, according to the weight of authority, from the conception of the State as a single entity within the international community. Juridical relations created by acts attributed to the State are not altered by the fact that the individual agents who commit the acts may hold government positions classed under the municipal law as legislative, executive, or judicial; they all cover State functions and the particular organization and characteristics of each one are immaterial in the international sphere. This conclusion is embodied in the doctrine which holds that the binding force of court decisions and the competency of the court which has rendered same, are material questions only in the local jurisdiction. The absolute averment to the effect that court decisions have no binding force in international circles does not appear to be legally sound. Such a view would be contrary to the fundamental principles of any international community based on mutual cooperation. It does not follow from this that judicial action has the same significance in the international as well as in the national jurisprudence. Of course, international jurisprudence has estab- lished that the proceedings of the local judiciary are under certain circum- stances subject to revision in accordance with international law, and that this might entail responsibility. These proceedings are the ones in which the national courts undertake to apply principles of international law. Responsi- bility might arise either from erroneously applying the international law, or from restrictions imposed thereon by the national jurisprudence. The Costa Rica Packet is a leading case on this subject. In the case of the Lotus, among others, the question whether or not the proceedings of the national judiciary affected the international law was dealt with. In this case the Permanent Court did not deal directly with the proceedings of the Turkish courts. As regards the facts, however, the responsibility imputed to Turkey was derived from the exercise of the local judicial functions. Notwithstanding the fact that responsibility arising out of the exercise of judicial functions may be unquestionable, the problems derived therefrom THE ADMINISTRATION OF JUSTICE 37 bear a distinctly peculiar character, and have not been clearly defined in international rulings. These problems cover the following: first, whether the decisions of local courts may or may not give rise to responsibility; secondly, the definition and extent of a denial of justice; and thirdly, whether international jurisdiction is or not dependent upon the exhaustion of local remedies. (b) The principle of respecting and abiding by court decisions is usu- ally accepted both in theory and in practice. The question is, to what extent should these decisions be upheld? This principle is not based upon the autonomy of the judicial system. Neither is it connected with the ancient and somewhat mystical conception of justice as a supreme majesty. Nor is it possible to consider it as an extension of the doctrine of judicial guaranties which establish the binding force of the res adjudicate in the local jurispru- dence. The international binding force of judicial decisions is sanctioned by the international jurisdiction which the States recognize. All the civil- ized nations have, or should have, a judicial organization and substantive and procedural laws sufficient to afford proper protection to the rights of per- sons who reside in their territory, as well as to the rights of foreign States who are fellow members of the Family of Nations. These rights cannot be protected by other States. The fact that the governmental functions of the State are confined to its territory establishes, therefore, the obligation to provide for the proper administration of justice, and this obligation creates the right to have the acts incident thereto—which constitute the administra- tion of justice—duly respected by the international community. Besides; this respect towards judicial action is essential to mutual independence and cooperation. It is due to these legal considerations that the decisions which the judges render in the national courts should be presumed in international circles to be regular and just. Up to this point there is no possible discrepancy; but it is necessary to determine: (a) when may a court decision be deemed to be the final ruling of the judiciary; (b) whether the presumption of regularity and fairness carried by every judicial decision may be set aside in certain cases; and (c) whenever this presumption is set aside, in what manner would international jurisdiction be established ? Both in theory and in practice there is also absolute accord on the fact that court decisions cannot be considered to give rise to international responsi- bility until all the local remedies available to determine their validity have been exhausted. (¢) But once the decision becomes final, would it be possible to chal- lenge it in the international community by reason of the so-called notorious or manifest injustice? This problem is, indeed, both difficult and compli- cated. In this connection the Institute of International Law adopted the 3 RESPONSIBILITY OF STATES following formula at its Lausanne session in 1927, covering responsibility by reason of a denial of justice or manifest injustice: “First; when the courts necessary to assure protection to aliens do not exist, or are not functioning. Second; when, in the absence of reasons justi- fied by the requirements of procedure, the courts are not equally accessible to foreigners and nationals alike. Third; when such courts manifestly fail to provide those guaranties indispensable to assure the proper administration of justice. “The State is equally responsible if the proceedings or the decision con- stitute a manifest injustice, and especially, if they have been influenced by 1l-will against all foreigners as such, or against the nationals of one State in narticular.” The Research Committee of the Harvard Law School has adopted the ‘ollowing formula as a solution for this problem : “A State is responsible if an injury to an alien results from a denial of justice. Denial of justice exists when there is a denial, unwarranted delay or obstruction of access to courts, gross deficiency in the administration of judicial or remedial process, failure to provide those guaranties which are generally considered indispensable to the proper administration of justice, or 2 manifestly unjust judgment. An error of a national court which does not produce a manifest injustice is not a denial of justice.” The Preparatory Committee of the Codification Conference propounded this question in Basis of Discussion No. 6, reading as follows: “A State is responsible for damage suffered by a foreigner as the result of the courts following a procedure and rendering a judgment vitiated by faults so gross as to indicate that they did not offer the guarantees indis- pensable for the proper administration of justice.” The replies of the various governments are not uniform. The Govern- ment of Australia deems that a State may incur responsibility if the decision is either corrupt or so erroneous that it could not honestly have been given by a competent court, or is given under pressure from the executive organs of the government. The Government of Belgium recognizes responsibility if after the judge has been shown to be guilty of corruption, the laws of the country do not allow the decision to be reversed. Great Britain believes that there are four principal grounds for responsibility in the case of an erroneous decision: if it is “(a) So erroneous that no properly constituted court could honestly aave arrived at such a decision; “(b) Due to corruption; “(c) Due to pressure from the executive organs of the Government: and 3g wh : “(d) Caused by procedure so faulty as to exclude all reasonable hope Lo ! of just decisions.” Cw =X. Norway accepts the ancient conception of flagrant injustice. Switzer- and states that: “If the future convention were to lay down that the State is internation- ally responsible, not only for judgments contrary to international law given by its courts and for manifestly incorrect decisions of the courts, but also for a denial of justice in all the forms in which it occurs (including wrongful dilatoriness on the part of the courts), we think that it would cover the essential points.” This theory involves the enforcement of principles of natural justice that are far above the will of the State. The substantive rules have not been laid down by the States. The application of the rules of construction may give rise to discussions among the States, just as it does among individuals, There is no reason warranting the prevalence of the view of one State over that of the others, when one of them disregards, or objects for special reasons, to the presumption of regularity and fairness to which a judicial proceeding is entitled. This difficult problem cannot very well be reduced to a definite formula that would either eliminate it altogether, or accept it without reservation. Neither is it free from dangerous consequences, be- cause it might lead to the revision of the decisions of national courts as a matter of regular procedure and to improper disregard of the judicial authority of the States. Nor could it be altogether eliminated, because it is an international question which arises in certain cases of claims due to un- usual injustice or corruptive practices. When a State disregards or, for special reasons, objects to the presumption of fairness and regularity with which a judicial act is invested, this establishes a conflict between two juris- dictions: one that is organic and regular (the national judiciary); and the other, which is inorganic and irregular, because it is not derived from the regular functions of the administration of justice within the States, and because it is exercised only on account of a conception based on extraordi- nary reasons. The only possible solution for this conflict would be to estab- lish a regular organization to pass upon the conflict, in other words, the jurisdiction of the community of States. International courts are the only ones competent to determine whether it is or not possible to set aside the usual presumption of fairness and justice carried by acts of the national judiciary. If a State should refuse to submit to the jurisdiction of the inter- national community, it could not, without violating the principles of equality, raise any objections to the validity of the action of national courts of other States. In other words, the decisions of the courts that enforce the munici- pal law cannot form the basis of responsibility unless so determined by the RESPONSIBILITY OF STATES international courts. The individual action of the State cannot be upheld as against the presumption of fairness and regularity which the international community attributes to the judicial functions of the various States. The solution might consist in organizing a special body to establish whether the facts warrant proceedings to fix international responsibility. This body could not, of course, pass upon the fundamental issues involved. It should determine, in the first place, whether or not the facts may justify a State in bringing up for discussion the regularity or fairness of a court decision. The usual current practice tends to solve the difficulties of this important issue by means of treaties. There is a form of treaty, like that between Poland and Switzerland (March 7, 1925), which submits to international adjudication certain matters which international law leaves entirely to the national jurisdiction of the States. But when under the municipal law one of these matters comes within the jurisdiction of the local courts, the de- fendant may object to the international jurisdiction until a final decision has been rendered by the competent national court. There is another type of treaty, as for instance the one between Switzerland and Spain, which sub- mits all controversies, regardless of their nature, to the international juris- diction. However, if any of these should come within the jurisdiction of the national judiciary, the defendant may object to the institution of inter- national proceedings until a final local decision has been rendered in the matter. (d) The definition of a denial of justice has been very ambiguous. John Bassett Moore feared that it might not be possible to set forth some formula that would actually serve to solve the problems arising in concrete cases. De Lapradelle and Politis remarked that the complicated and uncer- tain characteristics of a denial of justice seem to challenge all definition. Actual practice, however, has greatly contributed to bring about a relatively clear conception of the doctrine. One of the difficulties is due to the fact that such a broad conception used to be entertained in connection with the denial of justice that it comprised the action of all the State organs. As regards the action of the judicial authorities, the doctrine included the typical cases of denial of justice, as well as those involving deficient procedure or a manifest injustice. Another serious difficulty arose from the confusion be- tween the possible error of the decision which does not entail responsibility, and unusual deficiency or manifest injustice. No lines of distinction can very well be drawn between the various phases of a denial of justice, except by careful consideration of the facts of each concrete case. If the question involved is the lack of the indispensable organs for the proper administration of justice, or lack of laws authorizing the legal actions required by inter- national law, or refusal of access to the courts, or wrongful delay, or deci- sions influenced by ill-will against all foreigners as such or against the THE ADMINISTRATION OF JUSTICE 41 nationals of one State in particular, it may be stated without hesitation that there is a denial of justice. These instances have been enumerated more or less in the foregoing order in the Bases of Discussion of the Preparatory Committee. They have been accepted by the States in general. The Govern- ment of Germany deems that the international responsibility incurred by the State owing to the decisions of its courts of justice must be restricted. It points out the common accord in regard to a denial of justice, but maintains that the opinions as to the exact nature of this phrase are quite varied. The term comprises the refusal of access to the courts as well as undue delay in the proceedings, and also any clear violation of the law to the detriment of foreigners as a whole or certain nationals in particular. The Government of Austria avers that responsibility arises when the judicial organization does not come up to the usual standard of that of a civilized State, or when aliens are denied access to the courts. Belgium accepts the typical cases before mentioned as a basis for the application of the doctrine of denial of justice. Chile confines a denial of justice to refusing aliens access to the courts. Great Britain affirms responsibility in cases of refusal of access to the courts, inconsistency of the decisions with international obligations, and delay in the proceedings. The Netherlands declares that, generally speaking, the intrinsic value of a judgment in civil or penal matters cannot form the subject of a claim, except in cases where some point of international law is involved or where there has been a flagrant infringement of the principles of law. Poland believes that the plan for the determination of what constitutes a denial of justice formulated in the draft of the American Institute of Inter- national Law is more complete than that framed by the Committee of Ex- perts of the League of Nations. Switzerland points out the advisability of drawing a distinction between judgments which imply a violation of international law and those which, though not amounting to a violation, manifestly ignore the elementary prin- ciples of justice.2 t Article 3. Every nation has the right to accord diplomatic protection to its nation- als in an American Republic in cases in which they do not have legal recourse to the authorities of the country, or if it can be proved that there has been denial of justice by the said authorities, undue delay, or violation of the principles of international law. Article 4. Denial of justice exists—(a) When the authorities of the country where the complaint is made interpose obstacles not authorized by law in the exercise by the foreigner of the rights which he claims; (b) When the authorities of the country to which the foreigner has had recourse have disregarded his rights without legal reason, or for reasons contrary to the principles of law; (¢) When the fundamental rules of the procedure in force in the country have been violated and there is no further appeal possible. (Codification of American International Law—American Institute of Inter- national Law—Project No. 16—Diplomatic Protection.) . 2“In the former case, the State is invariably responsible; it is not, however, neces- sarily so in the latter case. It is not responsible, as has been pointed out, for the in- trinsic juridical merits of the judgment given. Every State is bound to afford full and absolute judicial protection to foreigners and this implies ready access to the courts. RESPONSIBILITY OF STATES Of all these various formulas, the one propounded by Switzerland seems to be the most legally sound. In view of the difficulties which this matter entails, the first requirement is not to confuse the cases of deficient organiza- tion of the judiciary with the cases of improper administration of justice due to the lack of judicial authorities, or legal actions, or regular speedy pro- ceedings, or refusing foreigners access to the courts, or the rendering of wrongful decisions prompted by motives beyond the purview of the law. These are concrete cases which might properly form the basis of clear re- sponsibility. The definitions of “a denial of justice” which include the con- sideration of the fact as to whether or not the courts offer proper guaranties introduce a very dangerous general conception. The insufficiency of the judicial system itself does not form basis of responsibility; this must be established by the facts. It is the facts, therefore, which give rise to responsi- bility. In other instances and in certain circumstances, responsibility might be involved even in connection with a regular and well organized judicial system. Another fact consists in that the proceedings or the trial should be anusually inconsistent with the principles of justice or constitute a manifest injustice. This type of injustice might be due to animosity towards foreign- ers in general or towards a certain nationality in particular. Or it might be due to corruption. In any event, to draw a line of distinction between these facts and court errors seems to be an insurmountable difficulty. Therefore, it is exclusively for international practice to determine the application of these two doctrines with such varied juridical import. As soon as the State has, in good faith, fulfilled its obligations, it is not in principle answerable for the erroneous decisions of its judges. The State must, however, be held responsible whenever it has not acted in perfect good faith or its judges have clearly allowed themselves to be influenced by considerations unconnected with the dispensation of sound justice. In such case, the erroneous judgment would be a violation of the principle of judicial protection due to foreigners and would thus amount to an offence against international law for which the State would be responsible. “Wrongful delay on the part of the courts undoubtedly involves the international responsibility of the State. Such delay is really one form of a denial of justice, an act which is contrary to international law. The arbitral award given by the President of the Swiss Confederation on December 3oth, 1896, in the Franco-Venezuelan dispute concerning the case of Fabiani, expressly stated that, “if we examine the general prin- ciples of international law with regard to a denial of justice, that is to say, the rules common to most bodies .of law or laid down by doctrine, we shall see that a denial of justice includes, not only the refusal of a judicial authority to exercise its functions and, in particular, to give a decision on the request submitted to it, but also wrongful delay in giving judgment.” (League of Nations Publication C. 75. M. 60. 1029. V., DP. 4748. VII PROTECTION OF ALIENS (a) There are no other positive cases of responsibility on the part of the State than those mentioned. Its organs are the only ones that can involve it under the circumstances stated. These include, practically, the cases in which responsibility arises out of the illicit acts of private individuals. The responsibility for such acts might be due to the attitude assumed by the State at the time of their commission. The reason why the State is not responsible for the wrongful conduct of private individuals does not lie in the fact that the person might not be subject to international law, nor be- cause he might be deemed incapable of violating its precepts. Such theory would be exaggerated and inadmissible. The reason lies in the nature of the acts. The acts of State organs are the consequence of their will moved by the moral or physical power of the community behind them. In the other cases, the individuals themselves are more than capable of committing the act without anyone’s instigation. The necessities of justice demand certain guaranties in connection with the former, while there are no good reasons to require them in the case of the latter. From the point of view of the responsibility that the State may incur by reason of its attitude in the case of wrongful acts of private individuals, the nationality of the wrongdoers is altogether immaterial. The responsibility arises out of the duty of the State to preserve order within its territory and as regards all its inhabitants. It is possible for an alien subject to commit an act against the foreign country in which he resides, or against his own country, or against some other State. No responsibility will arise in con- nection with the nationality of the perpetrator. For instance, the uprising of Venezuelan nationals in a Danish possession, viz., Curagao, which re- sulted in acts of violence against the Danish authorities and in the seizure of arms from their stores for the purpose of invading the Venezuelan territory could not involve the responsibility of the State whose nationals committed the act, by reason of their nationality. Any hostile or injurious acts of pri- vate individuals against a foreign State may give rise to responsibility only in certain cases. This does not cover the entire field of State activities. Damage caused by persons, in general, do not give rise to responsibility ex- 4-4 RESPONSIBILITY OF STATES cept in so far as the duty of the State to afford proper protection is con- cerned. The main question in this matter is, therefore, to determine wherein does the international obligation lie. If the damage has been inflicted upon another State, the principles of responsibility are limited by the duty im- posed by the community upon its members to mutually protect themselves in matters involving the essential elements of its preservation or dignity. If the damage has been caused to foreign nationals, the question to ascertain is whether the State should afford them the same protection given to its own nationals, or whether this protection may differ. This has been one of the questions which have on certain occasions incensed Latin American States, on account of the impositions of which they have been victims in the past on the part of powerful States that have exacted excessive indemnities for their nationals. There are conventions between the American States, constitutions and laws, treaties and court decisions, which have followed the policy of con- fining State responsibility within the limits of protection afforded to nation- als. This was also the doctrine of the old treaty authorities and it was in- corporated in the declaration of the Institute of International Law at its session in Oxford, wherein it was set forth that foreigners, regardless of their nationality, are entitled to the same civil rights as nationals, except in so far as otherwise specifically provided by current legislation. The same doctrine has been, of course, embodied in the draft code of the American Institute: “The American Republics do not recognize in favor of foreigners other obligations or responsibilities than those established for their own nationals in their constitutions, their respective laws, and the treaties in force.” The reports of arbitral awards and of diplomatic claims contain varied decisions. The oldest rulings follow the principle of equality of nationals and foreigners. In the latest cases, however, there appears to be a change in this view. This modification has been clearly and specifically set forth in the resolution of the Institute of International Law at its Lausanne session and in Decision No. 7 of the Permanent Court of International Justice. The resolution of the Institute imposes upon the State the obligation to treat foreigners in accordance with the international law. This treat- ment of foreigners may have to be better than that accorded to nationals, if the municipal laws do not come up to the standards required by the inter- national community. The Permanent World Court has proclaimed the pre- dominance of international common law. The mixed arbitration commissions organized under the peace treaties of 1919 follow the same principle. A ruling of the Claims Commission, United States and Mexico, in 1926, also sets forth that in this question the problem does not consist merely of com- paring the rights of nationals and foreigners, but that it is also necessary to allow foreigners their rights under international law. PROTECTION OF ALIENS 45 Some of the authorities differ as regards this latter view. It is pointed out that the international common law is not like the positive law established by treaties and accepted usage. Therefore, beyond these two sources, no definite standards could be established covering the duties incumbent upon the States. It might be well also to remember the indefinite line between national and international rights. At the present time, the States construe and apply these rights in many different ways. This is clearly shown by their action in connection with monopolies, government control of business, immigration, deportation of aliens, tariffs, and emergency laws regarding price fixing and other forms of restriction imposed upon commercial free- dom. This means that the juridical status of these matters, which are con- sidered to be of national incumbency, does not permit the establishment of international standards. It is doubted, therefore, whether international rules should be enforced in preference to the municipal law as regards the pro- tection of aliens. These comments refer to certain specific measures which are undergoing a stage of evolution in modern jurisprudence, and none of which are incon- sistent with the principles of natural justice that prevent the State sover- eignty from ruling without limitations of any sort, or making its will pre- ponderant in every sense, without giving due consideration to the funda- mental necessities of government generally accepted by the civilized world. There is a minimum juridical standard imposed by human civilization, with- out which neither the existence of the State as a sovereign entity nor that of the international community could be conceived. Even those various meas- ures to which we have referred are not altogether at variance in principle. Underlying these measures there are certain leading precepts that no State could afford to ignore without drawing protests from the others. One of these principles might be, for instance, the one of due compensation for the confiscation of property for public use. This debate, however, has no longer any theoretical importance or prac- tical significance. A scientific fact of paramount importance has been elicited, which has altogether altered the situation. It is now conceived that the rights of man are not a matter exclusively dependent upon the will of the State. It has been mentioned elsewhere that at its New York session the Institute of International Law has invested the rights of man with international character. This means, in other words, that the rights of man are thereby placed under the patronage of the international community. “The juridical mind of the civilized world”—states the pronouncement of the Institute— “demands the recognition of the rights of man free from all attempts on the part of the State.” The leading exponent of this doctrine, President Tames Brown Scott. thus comments upon it: RESPONSIBILITY OF STATES “If it were merely an original statute, the legislature of any State might abrogate it; however, the sacred rights of humanity are intangible and free from the attempt of any country, even if it were the most powerful nation. “A detailed comment upon these provisions”—adds Mr. Scott—*“would seem to be uncalled for; but I would like to make certain remarks. Specific rights are deemed to be acquired rights. We are not now insisting on the fact that they should be innate, inherent or inalienable, but it is the duty of the State to recognize and protect them. It is not the State speaking: it is the voice of the international community that makes iself heard. The com- munity exists, not by reason of a formal act on the part of the State, but owing to the coexistence of the various States, which should have common laws to protect the independence of the constituent members of the com- munity. And this community, over the head of the States, crosses their boundaries to protect the men, women and children who form part of it. The international community is not a discovery of our age. It has existed ever since two States existed, and with the birth and recognition of new nations, the international community grows in scope and power.” Therefore, in theory, there should be no possible difference between nationals and aliens: both should enjoy the same fundamental rights. The day will come when the international community will find a way to establish a minimum standard of rights for all men. This régime is now embodied in a few treaties, but in the not far distant future it might be established as a general principle of international relations. Undoubtedly, the principle will be differently construed for some time to come in its application to certain peculiar cases. But in these same questions that are presently the source of differences among the States, the evolution of the municipal public law and of the international jurisprudence, which will follow a parallel course, will gradually eliminate the points in controversy. The fact is that at the present moment, the fundamental rights and guaranties, viz. : the equal rights to life, property and liberty; the adequate organizations and necessary legal actions to render these rights effective; the administration of justice in fair and honest manner consistent with the public morals of the age; the maintenance of peace and order in regular manner so as to afford to all inhabitants an opportunity to attain the ends of their labor and happiness ;— constitute the current standard of the juridical mind of the world. Any State that fails to follow such standard becomes responsible and should make reparation for the consequent injury. The duty to establish it is both international and national in character. Presently, the international char- acter of this duty is more effective, because the alien is also covered by the protection of his own State. The problem for the future will be to extend this standard so that man, by the mere reason of being such, will be entitled to the same protection no matter in what part of the world he may be, and regardless of his nationality. However, it may be stated that this problem of the legal status of aliens PROTECTION OF ALIENS 47 in relation to nationals has been practically eliminated from discussion in America. The legislation of all the American Republics is decidedly ad- vanced on this point. There is not a single one of these Republics where aliens do not enjoy personal guaranties and civil rights. The American Republics have just recently codified the International Private Law, and in the Convention signed at the Habana Conference these rights are specifically recognized, with the only minor restriction that for reasons of public policy the municipal law may at times render the exercise of a right subject to certain conditions. The greatest differences in the status of nationals and aliens are found in European legislation. It was thus pointed out by the American members of the European Institute of International Law when the formula whereby aliens would enjoy a privileged status as regards nationals was brought up for discussion. In the American Continent, the problem of responsibility has achieved considerable advancement by reason of the recent Washington convention. This convention has established the supremacy of the international law in matters affecting the community of States. However, this was not achieved without considerable effort. There was a vigorous contest on the part of the forces tending to exclude from international adjudication all matters concerning injuries to foreign persons or corporations. However, when these questions involve principles of international law, the State could not very well avoid responsibility therefor without impairing the guaranties of justice, and destroying every hope for the organization of the community. A battle was also waged with the forces that proposed to exclude inter- national justice in matters involving constitutional provisions. This would retard our progress and would also practically void all that has been achieved by arbitration. These tendencies represent, in fact, the will of the State attempting to veto the fundamental requirements of justice that are far above all national policies. The juridical civilization of Latin America has achieved quite rapidly a very high standard that can be compared with those of the European States. Life in America is comparatively comfortable and safe. There are vast resources. The laws protect the working man and are based on cooperation. Order prevails everywhere. Political revolutions have become very rare. The alien establishes himself, develops love for the land, and in the end becomes one of its own. After two generations, the combined European blood has formed a new people and the old country is but a pleasant memory of the past. Such is America! It is a young continent that fears power not, since its Nations are founded upon principles of righteousness, and because they constitute a joint political and economic power that may not be en- croached upon with impunity. Those who set up American interests to evade international obligations and attempt to shield themselves behind the 18 RESPONSIBILITY OF STATES exclusive jurisdiction of the national laws, thereby convey a wrong im- pression of Latin American culture and detract from its greatness. The American Republics can fully assume their international obligations and enter the field of mutual cooperation that forms the basis of modern life. Their adherence to the international jurisdiction, sanctioned at the Washing- ton Conference in 1929, is conclusive evidence of the fact that they have assumed their place in the new community of States. (b) With regard to the acts of private citizens the State, as previously mentioned, does not afford any guaranties. The functions of the govern- ment constitute the enforcement of a set of constructive regulations that establish the import and limitations of the acts among the various individu- als, determine whether they are licit or illicit, and provide the penalties there- for. This is the mission that the States carry out within their territory. From the fulfilment of this obligation depends the security and welfare of ‘ndividuals, no matter where they may be. This is the full extent of the func- tions of the State in this regard. When it has fulfilled same within the minimum standards usually conceived at each stage of human civilizafion, nothing more can be required of the State. The State cannot become responsible as an insurer of justice or of the legality of human acts. Its obligation consists merely of adopting the most reasonable precautions to prevent wrong, consistent with individual freedom, and enforcing proper measures to curb the violators of the law. It is usually maintained that if the State does not exercise due diligence to prevent the commission of wrong, or fails to curb same, it is responsible for the injurious conse- quences. Some authorities base this responsibility of the State upon its failure to exercise due diligence by using the means available, while others base it upon the very fact of having failed to prevent or curb the punishable act, as it was its duty so to do. Diplomatic procedure and international jurisprudence appear rather inclined towards considering the question of guilt in matters of responsibility. The serious incidents of the Serajevo assassination, the events at Janina and the Hague conventions bear out this statement. The majority of arbitral awards and rulings of mixed claims commissions have also, more or less, followed this view. The question of guilt or blame has come up since the rulings of the mixed claims commissions under the Jay Treaty. The claims of the Jamaica and the Elizabeth involve this problem. These cases were in connection with the responsibility of a neutral State by reason of the acts performed within its jurisdiction by either of the belligerent States in violation of its neutral ity. In the first case, the decision was based upon the fact that there was no evidence to show that the defendant State had allowed or in any way connived at the alleged act, or failed to use all the means at its disposal to prevent same. In the Elizabeth case the significance of the phrase “all the PROTECTION OF ALIENS 49 means at its disposal” was argued. In the solution of this question, con- sideration was given to the fact that the State had done everything that it would have or could have done had the claimant been one of its own nationals, which is all that the law and custom of nations require to be done on behalf of an alien. The defendant State was not responsible, under its promise, when the means available proved ineffective. In the Alabama claims the question of guilt was one of the three main points of the argu- ment. The greatest effort known in international procedure was made in this case to determine the scope of the phrase “due diligence”. The Wash- ington rules were drafted in very ambiguous language, attributing responsi- bility if the neutral State should fail to exercise due diligence to prevent the violation of international obligations within its jurisdiction. However, they did not specify what degree of diligence such duty involved. In the decision, no principles of international law were applied; it was merely confined to the application of the usual principles of guilt under private jurisprudence. The British doctrine of diligentia quam in suis rebus, where- by failure to use due diligence would consist in not taking the steps usually resorted to for the safety of the nation and its citizens, was rejected. How- ever, the degree of guilt was not estimated by the amount of the damage, but by the extent and apparent imminence of the danger involved. This construction has been followed in the resolution of the Institute of Inter- national Law in 1875, in the Thirteenth Hague Convention and in the de- cision of the Hague Court in connection with the Casa Blanca deserters. When dealing with the obligation of neutral States, the Institute refers to manifest negligence. The Hague Convention provides that the State should use oll the means at tts disposal to prevent the violation of its international duty of neutrality within its jurisdiction. In order to determine the re- sponsibilities of the German Government, the decision goes into the willful neglect of its agents. This is as far as we have gone as regards the question of guilt. This is established : either by the failure to use all the necessary means, or those which the State should usually have at its disposal, or those which the State actually has at its disposal, to prevent the violation of international law. The distinction is quite important. The first case involves absolute responsibility ; while the second only entails a relative responsibility, because it is in a way subject to the circumstances of the case and of the State in question. This difference was clearly pointed out at the 1927 session of the Institute of International Law by professors Strisower, De Visscher and Politis. Pro- fessor Strisower, who was the reporter, proposed that the responsibility of the State for acts resulting in damage to private individuals should depend upon its failure to adopt the measures that it is usually advisable to adopt under the circumstances in order to prevent or repress such acts. As regards 30 RESPONSIBILITY OF STATES damage caused in civil wars, riots or rebellions, he proposed the same prin- ciple of due diligence which it is usually advisable for the State to exercise under such circumstances in order to prevent or check such acts. Profes- sor Charles De Visscher stated that the obligation of the State should be commensurate with the means at its disposal. Mr. Politis did not accept this view, which makes responsibility dependent upon the circumstances of the State. “If this doctrine is to be made subject to internal troubles,” Mr. Politis said, “it would place disorganized States in an advantageous position, and their responsibility would become too limited. In accordance with the formula of Mr. De Visscher, where there is the most damage caused by internal trouble, there would also exist the least responsibility. The speaker suggests, however, that, to a certain extent, the influence of the temporary impotence of the State might be taken into consideration in determining its international responsibility.” However, this resolution of the Institute does not appear to be quite in accord with the view of the European governments. The Bases of Dis- cussion of the Preparatory Committee mention the cases in which the authori- ties have failed to accomplish everything in their power to preserve order, or have failed to exercise reasonable diligence to punish those who have inflicted injury upon the person or property of an alien. The replies of the governments refer, as a rule, to the duty of the State to accomplish everything in its power. Other governments prefer the doctrine of reason- able diligence or reasonable steps, and one of them (the Government of Austria) refers to the conduct of the State that is not what might be usually expected of a civilized State. In any event, the prevailing view is not to require the State to do the impossible. Its obligation depends upon its available means and its circumstances. It should not be conceived, how- ever, that these means might be permitted to be so utterly deficient as to amount to a practical avoidance of the duty to afford proper protection. On the other hand, it would not be proper to think, as Mr. Politis does, that the relative lack of development of a State or its temporary disablement operates as a sort of punishment upon it, by applying to it the same stand- ards of protection expected under normal conditions. Of course, it would not be altogether unfair for courts of arbitration to apply this doctrine when the lack of development cannot be tolerated, or when the degree of disorganization can not be properly explained by the actual circumstances. Nevertheless, it is quite possible for situations to arise wherein the mitiga- tion of the responsibility, and even utter exemption therefrom, would seem only proper. It is advisable to adopt, as regards this question, a formula that will be sufficiently flexible to permit the international jurisprudence to be guided by principles of justice in its application to the great variety of con- crete cases. VIII EXHAUSTION OF LOGICAL REMEDIES After the cases involving responsibility have been established, it should be stipulated, as hereinbefore suggested, that the prosecution of them should not always depend upon diplomatic claims procedure or interposition on the part of the governments. Responsibility is an obligation imposed by the principles of justice. The enforcement of responsibility is a function that may be either national or international. It is primarily a national function. Civilized nations have established administrative and judicial organizations for the purpose of preventing injury, repressing illicit acts, and providing due reparation for the damages sustained. In the international community there is, or should be, among the States, an agreement to set up a similar organization to exercise these functions in the international sphere, in order to restore cordial relations whenever impaired by a violation of the rights of any one of the States. This would be an excellent way of reconciling national autonomy with international cooperation. Moreover, this system is necessary in order to raise the standard of good will in the international relations of the States, and to avoid friction between their governments. Their intervention, after all, is only justified in cases of necessity. If there is no need for intervention, because of other expedient means available, diplomatic intervention would imply an exercise of undue pressure as re- gards questions of juridical nature. In this regard all the scientific views are in perfect accord! both in the practice followed by the States, as well as in international jurisprudence. There is also the very important part *The work by Edwin Borchard, Diplomatic Relations, and The Responsibility of States in International Law by Clyde Eagleton, contain convincing data on this point. * This practice is evidenced by the diplomatic correspondence of many of the States and by other documents of their governments. The note of the British Foreign Office of April 24, 1916, may be cited. This note sets forth that the Government of Great Britain attributes considerable importance to the rule that all national remedies should be exhausted before any diplomatic action is taken. ' Among the large number of cases cited by Borchard, Eagleton and Ralston on this point, the following may be mentioned: Burn Case, Moore's Arbitrations, p. 3140; Bensley Cases, ibid., pages 3016-3018; Lagueruene, ibid. 3027; Baldwin, ibid. 3126; Sel- kirk, ibid. 3130; Leichardt, ibid. 3133; Jennings, Laughland and Co., ibid. 3135; Slocum, ibid. 3140; Ada, ibid. 3143; Smith, ibid. 3146; La Guaira, Ralston’s Venezuelan Arbitra- tions, p. 182; De Caro, ibid. 819; Poggioli, ibid. 867: Canadian Claims for Refund of <2 RESPONSIBILITY OF STATES played by the large number of treaties on arbitration and conciliation recently made! All of these treaties provide that in matters within the jurisdiction of the national courts, the international proceedings will be subject to the exhaustion of the local remedies available to the injured person for the purpose of securing redress. This is also, more or less, the conclusion adopted by the Preparatory Committee. The majority of the governments have adhered to this doctrine without hesitation. Only in isolated cases have certain reservations been made. Denmark affirms the principle, especially as regards injuries caused through the action of the courts: “In the case of the acts,” she adds, “of an administrative authority, the above principle cannot, however, be applied unconditionally. In the domain of the administration, it is possible to conceive of cases in which the act of a subaltern authority may give rise to diplomatic action, even though the person concerned has the right of recourse to a higher in- stance. Here the decision must depend on the nature of each case; no definite limits can be set. In the collection of taxes, Customs or other duties, contrary to the provisions of commercial treaties, the claim may doubtless be brought immediately against the State, even though the foreign private individual were entitled to complain to a higher Customs or fiscal authority. When, however, the matter is rather one of technical or arbitrary judgment—as for instance the classification of certain goods under a certain tariff heading—the State in question may insist that the foreigner shall first of all submit the matter fo a higher expert authority before making anv claim against the State.” Hungary avers, on her part, that “This principle may, of course, be modified on behalf of foreigners as a result of an obligation assumed by the State in an international con- vention, or when the settlement of a dispute falls in virtue of an inter- national agreement. within the jurisdiction of an international organ.” Japan restricts the application of the principle to cases involving court de- cisions, Finally, Norway states that “If damage has been caused to a foreigner as a result of an act con- trary to the various laws of the State, the foreigner in question must first exhaust all remedies open to him under the laws of that State before international responsibility can be invoked against the State. The only exception to this rule would be in extreme cases of denial of justice or other flagrant injustice. Hay Duties, British American Claims Commission, March 10, 1925, American Journal of International Law, vol. 19 pages 797, 799; The R. T. Roy, ibid. 802; Adolph G. Studer, ibid. 794. . *Traités Généraux d’Arbitrage cornmuniqués au Bureau International de la Cour Permanente d’Arbitrage. EXHAUSTION OF LOGICAL REMEDIES 53 “If damage has been caused to a foreigner in violation of contractual engagements or other indisputable obligations at international law, inter- national responsibility may be claimed against the State irrespective of the condition that the matter must have been laid before the national courts.” These reservations, however, do not affect the principle in question in any way, because practically all of them refer to matters that are essentially international in character, such as offences between States, differences of opinion in the interpretation of treaties, and the application of their pro- visions. In some of these cases it is possible for the State to make repara- tion through its national organs; and to allow the State an opportunity to do so would, naturally, make for cordial relations. However, these matters pertain to the international jurisdiction by reason of their very nature, and in the majority of cases they are beyond the scope of the State organs. The other points refer principally to damage caused to private persons. The responsibility arising therefrom, or in connection therewith, exists from the moment that the injury was inflicted. However, in order to make this responsibility effective, various proceedings have to be followed. The claim instituted through diplomatic channels is a relative and temporary pro- cedure. This is resorted to whenever the State has failed to discharge its obligation as regards the proper administration of justice. . This procedure will continue to be followed while the injured parties are not afforded personal actions that can be directly prosecuted by them in the international jurisdiction. And for the very reason that this diplomatic claim proceeding is relative, temporary and liable to impair the cordial relations of the States, its use should be properly restricted. The codification in this regard should also be inclined towards restriction, The codification formulas propounded in the various plans do not appear to be materially different. However, they are not free from defects. Basis No. 27 of the Preparatory Committee has the difficulty that it does not contemplate the cases in which the person has international remedies available. The formula of the Harvard Law School Research Committee is imperfect, because it subordinates responsibility itself, instead of the mere diplomatic proceeding, to the exhaustion of local reme- dies.3 The formula of the Institute of International Law is-an improve- 1 Société des Nations—Conférence pour la Codification du Droit International—C, 7s. M. 60. 1920 V. 2 “Where the foreigner has a legal remedy open to him in the courts of the State (which term includes administrative courts), the State may require that any question of international responsibility shall remain in suspense until its courts have given their final decision. This rule does not exclude application of the provisions set out in Bases of Discussion Nos. 5 and 6.” (Conférence pour la Codification du Droit International, C. 75 M. 69. 1020 V. p. 139.) ® “Article 6.—A state is not ordinarily responsible (under a duty to make repara- tion to another state) until the local remedies available to the injuried alien have been exhausted.” (Research in International Law—Harvard Law School—p. 133.) 54 RESPONSIBILITY OF STATES ment, but it does not make allowance for the possibility of exercising munici- pal jurisdiction in certain occasional cases of damage of international character, in which the responsible State tenders or undertakes by itself to make reparation. This deficiency should be corrected. Said formula is as follows : “No claim for indemnity may be instituted through diplomatic chan- nels, while the injured person still has at his disposal efficient and suf- ficient means for the proper handling of the claim. “No claim for reparation for the damage sustained by persons may be instituted either, if the State responsible places at the disposal of the injured persons efficient means to secure redress ** Moreover, it would also be advisable to supplement the foregoing for- mula, as a basis for its provisions, with that of the Harvard Law School Research Committee, which establishes the duty of every State to afford aliens efficient means of redress for the damage they may have sustained by reason of the acts of public officers or agents, or of private persons.! Thus corrected and supplemented, the resolution of the Institute of International Law appears to cover all the requirements of this interesting problem. * “Article 5.—A state has a duty to afford to an alien means of redress for injuries which are not less adequate than the means of redress afforded to its nationals.” (Re- search in International Law—Harvard Law School—p. 133.) IX CIVIL WAR, INSURRECTIONS AND MOB VIOLENCE (a) The damages which involve the responsibility of the State, result- ing either from the acts of its organs or of private persons, might arise under certain circumstances that give them a special nature. This refers to such situations as insurrections, civil wars, riots, or popular disturb- ances. Some of the authorities consider these acts subject to the same common rules of international responsibility applicable to illicit acts of public officers or private persons. It seems evident, however, that the peculiar circumstances involved in these various acts should not be altogether barred from consideration. It is just precisely due to this fact that attempts have been made to establish different doctrines as a basis for responsibility. In some cases responsibility is made absolute, or with exceptions; in others there is utter exemption from responsibility, or with certain exceptions; and finally, in certain instances responsibility is subject to the consideration of the conduct of the State as regards the damage caused or the public disturbance. However, all these doctrines are still mere theories. There is, on the other hand, a practical and well defined principle, as very few are, that is observed both in practice and in international jurisprudence. This is the doctrine whereby the State is not responsible for damage caused by insurgents or revolutionists.? It is thus set forth in most of the replies of *The following doctrines have been propounded: 1. The quasi ex coniractu of Breton. 2. The one which applies State risks in international matters. (Fauchille.) This is based upon the fact that foreigners constitute a source of profit for the State wherein they reside and that it is only logical and fair that in consideration thereof, the State should have the obligation to indemnify them for whatever damage they may sustain on account of the acts of the State’s nationals or of other aliens. 3. The one which renders the principle of indemnity for compulsory expropriation applicable to the international jurisdiction. (Brusa.) “4. The objective theory of impotence (Wiese), which derives the responsibility of the State from its failure to preserve order. And finally, 5, the so-called doctrine of “common interest”, which considers an alien residing in a foreign country as an integral unit of the national community. The damage which he sustains, or might sustain, in case of riot, insurrection or civil war, is covered by a sort of virtual nationalization and does not involve inter- national responsibility. (Podestd Costa.) ?In his work on “Diplomatic Protection”, Mr. Edwin Borchard cites the outstand- ing scientific authorities in support of the doctrine that the State is not responsible 56 RESPONSIBILITY OF STATES the various governments to the inquiry of the Preparatory Committee. Some of the governments, such as those of Japan, Norway, Netherlands, Poland and Roumania, state outright that there is no responsibility in this case. Other governments, viz., those of Germany and Great Britain, explain the reasons why no responsibility is involved and subordinate it to the duty of the State to protect alien subjects. In accordance with this view responsi- bility might be incurred, as stated by the German Government, if the State organs have acted in violation of international law, that is, if they have not afforded sufficient protection or have failed to accomplish everything they could under the circumstances, allowing thereby occasion for the claims of the aliens to arise by reason of the injuries inflicted upon them by private persons. Great Britain applies the rule of negligence as a basis for responsi- bility and extends it to cover the cases wherein the government allows reparation to its own nationals, which should then be also made applicable to foreigners; and cases in which the insurrection is successful and a de facto government is established. This rule covering the negligence of the State, or, inversely, of the due diligence which the State should exercise to prevent the damage or repress the culprits, is the one propounded in the Harvard codification plan,! and also the one adopted by the Institute of International Law.2 The Harvard plan refers to due diligence, while that of the Institute sets forth the diligence which a State should usually exercise under the same circumstances. The project of the American Institute of International Law exempts the States from responsibility “except when the said governments have not maintained order in the interior, have been negligent in the suppression of acts disturbing this order, or, finally, have not taken precautions so far as they were able to prevent the occurrence of such damages or injuries.”® This plan represents the gradual development of the various formulas of the Pan American Conferences. The Second Conference held the State responsible only in the event that the “constituted for damage caused by insurgents, and then gives a detailed list comprising three pages, covering the large number of cases in which international commissions have upheld this rule whenever their jurisdiction was not limited in this respect by the conventions under which they were created. Mr, Borchard adds that this rule is also stipulated in a great many treaties between European nations and Latin American Republics. * Research in International Law—Harvard Law School. *In order to determine whether the State is responsible, the formula of the Insti- tute considers also the fact as to whether or not the State affords alien subjects the same protection accorded to its own nationals. It affirms, especially, the obligation to allow foreigners the same rights to indemnity provided for nationals in connection with the acts of municipalities or of other persons. Likewise, it recognizes that the State is relieved from responsibility for acts of insurgents when these have been recognized as belligerents. (Annuaire de I'Institut, 1927—tome 3.) * Project No. 15, Responsibility of Governments, prepared by the American Institute of International Law at the request of the Governing Board of the Pan American Union, dated January 2, 1024, to be submitted to the International Committee of Jurists. Submitted to the Governing Board on March 2, 102¢. CIVIL WAR, INSURRECTIONS AND MOB VIOLENCE 57 authorities should be lax in the fulfillment of their duties.””* The formula of the Government of Switzerland is more in line with that of the American Institute : “The State is rightly to be held responsible for damage caused during an insurrection or riot if it has not taken proper steps, in conformity with its international obligations, to maintain order and public security. We agree with von Bar that the State does not guarantee to foreigners a security greater than that it guarantees to its own subjects: but, by allow- ing foreigners to enter the country and establish themselves therein, it promises to accord them as great a degree of security as it does to nationals; it is therefore responsible if it does not provide such a degree of security.”’2 (b) It may be noted, therefore, that the opinions are uniform in denying the responsibility of the State, but take into consideration the de- ficient conduct of the State in affording protection to aliens. However, the formula that would embrace this conception would present certain difficulties. The phrases “due diligence” and “the diligence which it is usually advisable to exercise” are either too vague or too comprehensive. The most vague ones are those of American or Swiss origin, The formula that takes into consideration the conduct of the State organs that have acted in violation of the international law is also indefinite. The doctrine which sets forth that negligence is shown by the fact that the State might have prevented the damage caused is, unquestionably, the best one. This is the British formula. {c) It might be well at this time to call attention to the other exceptions to the rule whereby the State is relieved from responsibility, which deal: one, with the equal treatment of foreigners when the State allows indemnity to its own nationals; and the other, with cases in which the revolution is successful. The first exception does not present any difficulties. The States are quite particular about the fairness of their action. Besides, it is only fair that reparation should be accorded to all the victims. The ideal aim is to have this reparation constitute a principle both of national and of inter- national law. The second exception is also supported by the majority of the governments. Most of them have replied to the inquiry of the Preparatory Committee in the affirmative. However, there are some dissenting opinions. That of Finland is conclusive: “The fact that the insurgent party becomes the Government does not alter the responsibility of the State itself.” The Netherlands states: “It is doubtful whether the insurgent party can be held responsible for acts committed previous to its assumption of power.” Poland ” !Wiesse; Le droit international appliqué aux guerres civiles, Lausanne, 18¢8, trad. onay. ? Société des Nations. Conférence pour la codification du Droit international—No. officiel, C. 75. M. 69, 1029, V. 58 RESPONSIBILITY OF STATES maintains that the success of the insurgent party and its assumption of the government, do not affect the responsibility of the State. Czechoslovakia states: “The State is not responsible for damages caused by insurrection, however, if the claimant State and the State against which the claim is brought both recognize the insurgents as belligerents. “The question whether a revolutionary Government is responsible for damage caused during a civil war to the person or property of foreigners where the insurgents gain power is not yet ripe for settlement, and it seems unlikely that any general formula found for it would secure unanimous acceptance. The reply to this question, above all, would de- pend on the circumstances of the case, more particularly on whether the acts which caused the damage could be attributed to the new Government or to its agents.”’? These are neither isolated opinions nor do they lack proper grounds. The opinion based upon the success of the insurgents could be termed the doctrine of success. Victory, which has become a fact, would control the juridical relations. The fiction of the national will, which is presumed to lie with the successful side, may be used to explain the advantage of hold- ing responsible the new revolutionary government that comes into power; but it does not attribute any juridical character to such advantage.2 The acts involving responsibility and committed during the revolution are due to the fault of those who committed them. If fault exists, responsibility follows. It would not then seem correct to state that the Government is responsible for damage caused by the insurgents “if the insurrection is suc- cessful and the insurgent party has assumed power”. The formula of the Harvard Research Committee is preferable: “In the event of a successful revolution, the state whose government is established thereby is responsible if an injury to an alien has resulted 1 Ibid. ® Professor Podesta Costa, of the Argentine, maintains this view in his work entitled “Ensayo sobre las Luchas Civiles y el Derecho International” (Essay on Civil Wars and International Law). The following is quoted therefrom: “As regards specific injurious acts, there is no foundation for the view that the accidental and extraneous fact of final victory of the insurgent party should alter the juridical ques- tion arising between the State and the injured alien on account of the commission of such acts by members of the insurgent party . .. if the hypothesis should be accepted a posteriors that the national will is with the successful party from the inception of the revolution, it should also be concluded that, at the beginning of every civil war, the responsibility of the State for injurious acts will be involved, either in connection with the acts attributable to the constituted Government, or in connection with those at- tributable to the insurgent party, depending upon which of the two should be finally victorious; and if this conclusion is established, when the insurgent party is finally successful, the State would have to be relieved from all responsibility for the acts attributable to the former constituted Government” CIVIL WAR, INSURRECTIONS AND MOB VIOLENCE 3g from a wrongful act or omission of the revolutionists committed at any time after the inception of the revolution.’’! (d) If the damages have not been caused by the insurgents, but by government officers or agents in their efforts to quell the insurrection, the general rule is that the State is not responsible, although this is subject to certain conditions and exceptions. The havoc of war is considered to be an inexorable calamity. It is in this case that the doctrine of zis major is fully applicable. Among the opinions stated in the replies of the govern- ments to the inquiry of the Preparatory Committee, one of them is unique, and that is the view of the Government of Switzerland to the effect that damage caused by the armed forces of the Government in the suppres- sion of revolts are the consequence of measures adopted by the authorities for the public welfare, but that it would be only the just duty of the com- munity to indemnify private persons for the actual damage sustained by them in the course of the operations. This duty would not cover indirect damage, because this would be impractical. This view is worthy of careful consideration as regards the duty of the community towards all of its mem- bers irrespective of their nationality. This could be further amplified to cover all damages resulting from war, within a reasonable limit acceptable to the States, and provided that this would cover the enforcement of a principle of social welfare for the benefit of all inhabitants without discrimination. However, the difficulties of a provision of this nature in an international convention, could not very well be disregarded. The fact remains that, with the exception of destruction and injuries caused to persons or property in the course of military operations and especially in battle, all the acts that imply an enrichment of the State, such as requisitions, among others, are of course subject to the obligation to allow due compensation. (e) Upon drafting a formula to cover responsibility in respect of damage caused under these circumstances, the danger and inconvenience en- tailed by the use of misleading terms should be constantly borne in mind. The reply of the Government of Great Britain to the inquiry in question sets forth that the State is not responsible for damage unintentionally inflicted by the authorities or the armed forces during the course of the suppression: “Compensation must be paid for the property of a foreigner appropriated or intentionally destroyed in the course of such operations, but not for property destroyed or injured unintentionally.” This formula could not be more misleading. The elements of will or intention as regards the causing of the damage have no application in this case. The commander of an army may have a manufacturing plant in which the rebels are barricaded in- tentionally destroyed. The act, however, would be a genuine military opera- * Harvard Law School--Research in International Law. £0 RESPONSIBILITY OF STATES tion. On the other hand, the accidental and involuntary explosion of powder or ammunition in a building occupied by Government forces might destroy it, and just because the act was accidental it would not relieve the State from the obligation to indemnify for the damage. Basis of Discussion No. 21 of the Preparatory Committee is also somewhat indefinite in certain respects: it affirms the obligation to “Make good damage caused to foreign- ers by acts of its armed forces or authorities where such acts mani- festly went beyond the requirements of the situation or where its armed forces or authorities behaved in a manner manifestly incompatible with the rules generally observed by civilized States.” It can easily be understood without much effort that a subsequent inquiry into the requirements of a particular situation during war operations might give rise to all possible sorts of conclusions. With such formulas the code would be subject to all kinds of varied and capricious applications. The purpose of codification is to establish definite and specific obligations. And there is a possibility of accomplishing this end within certain confinements. There are only three situations to consider: first, war damage; secondly, damage that has not been caused in battle, but which is incidental to the insurrection; and thirdly, acts that result in enrichment or profit to the State. The first, for the time being, is not entitled to reparation, although there is a tendency to improve the situation of the victims irrespective of their nationality. The second is subject to the general principles of responsibility for the acts of officers or agents of the State, although keeping in sight the inevitable disturbance caused by the cruel reality of civil war. The third comes under the com- mon law. All of the States assume responsibility for expropriations, occu- pations, requisitions, etc., either in time of peace or of war, to the detriment of nationals or foreigners. (f) Damages caused by mob violence, popular riots or disturbances, occupy an intermediate position between those caused by private persons and the ones incident to insurrection. These damages resulting from mob violence are the most frequent ones. They are caused, as a rule, by the outburst of racial, political or religious feelings. No special rule applicable to these cases has been established by practice. Quite often the States have accorded indemnity to the victims of mob violence without prejudice to their right to disclaim responsibility. The underlying principle is the same herein- before stated, subject to the duty of the State to exercise due diligence! In "The State is responsible, however, when it fails to use due diligence to prevent or suppress the riot, or when the circumstances indicate insufficiency of the measures of protection, or .connivance of the government officers or agents at the disturbance. Borchard, Diplomatic Protection, p. 224. It is maintained, therefore, that if due dili- gence is exercised to prevent or suppress sudden uprisings, and to punish those impli- cated, there is no obligation to make reparation ... Moore: “The Responsibility of Governments for Mob Violence” Columbia Law Times, V, 212. See Hyde. Inter- CIVIL WAR, INSURRECTIONS AND MOB VIOLENCE 61 the Bases of Discussion of the Preparatory Committee, there is also added to the cases of mob violence and popular disturbance the fact that the move- ment should be directed against foreigners as such. There appears to be no reason whatever for this distinction. The feelings that stir the mob might be either political, religious, economic or international. Their nature is immaterial. The nature and aim of the movement are questions which the international court might consider in determining the degree of diligence that the State should have exercised. But beyond this, which has no relation to the substantive law, it seems unnecessary to refer specifically to one of the various forms of popular disturbances. national Law, I, p. 200; editorial comments on the Aigues-Mortes Case, Revue générale de droit international public, I, 175; Garner, in Proceedings of the American Society of International Law, 1927, p. 62; Coffey, ibid., pages 63-04. SELF-DEFENCE, NECESSITY AND RESCISSION (a) There are some who consider the suppression of insurrections as a legitimate case of defense, and maintain that by reason thereof, the State is exempt from responsibility for the damages caused, provided that these do not exceed the limits of actual necessity. This is the opinion stated by the Government of South Africa in its reply to the inquiry of the Preparatory Committee.! However, this view is not acceptable. There are various cases in which the State is free from responsibility, and these are: first, self- defense understood in its strict meaning; second, reprisals; and third, cases of necessity. It is considered that damages caused under any of these cir- cumstances do not entail in every case the obligation to indemnify. Self- defense is both a right and a duty of all persons and communities. It implies an undue and unjust assault, either actual or threatened, against which immediate reaction is imperative. In its international aspect the doctrine of self-defense is not, as in the penal jurisprudence, a rule of law with clear and well defined limitations. Upon being exercised, its limits are liable to be exceeded, and its consideration by international courts will always be a very delicate matter. Nevertheless, the doctrine is essential. It cannot be dis- pensed with as a reason for justification when a State has been forced to prevent or repel an attack without the necessary time to curb it in the usual way. However, this is not the case either with reprisals or the so-called “cases of necessity”. Reprisals are the remaining traces of an utterly dis- organized community of states. They are not an unavoidable reaction and should be abolished. However, as they could not be banished outright, it would be advisable to restrict them, by subjecting them, when authorized, to certain conditions of tact and discretion, such as have been communicated by the governments of Denmark, Great Britain and Switzerland.2 In deal- ing with responsibility, however, the question of reprisals cannot be directly considered. But if severe measures should be provided as regards responsi- bility arising out of reprisals, there is no doubt but that this would have a * Point XI of the Inquiry of the Preparatory Committee. "Inquiry of the Preparatory Committee. SELF-DEFENSE, NECESSITY AND RESCISSION 63 salutary effect upon the development of the principle along the lines sug- gested. (b) As regards cases of necessity, the Preparatory Committee has pro- pounded a general formula that refers only to the concrete case of repudia- tion of the contractual obligations of the State. On general principles, neces- sity does not justify repudiation, nor does it come within the scope of the Law of Nations. It is a situation wherein the interests of the first party, protected by the law, are in actual danger and there is no other solution but to violate the rights of the second party under juridical sanction. It differs materially from self-defense in that—as stated by Carrara—self-defense is a “reaction”, whereas, necessity resolves itself into an “action”. This action can be defined in the municipal law, inasmuch as the measure of damages can be practically determined. Its application to international relations would be impractical and, under certain circumstances, it would tend to im- pair the fundamental rights of innocent States. “Tt was thus with good reason”—the eminent Mr. Charles De Visscher comments—*“that the American Institute of International Law formulated in 1916 the following fundamental rule that embraces a solemn protest against the doctrine of necessity: “ “Every nation has the right to exist, and to protect and to conserve its existence; but this right neither implies the right nor justifies the act of the State to protect itself or to conserve its existence by the com- mission of unlawful acts against innocent and unoffending states.’ “All the terms of this pronouncement are worthy of consideration: it recognizes the right of conservation within the limits imposed by due respect for the rights of others, condemns the doctrine of necessity that attempts to exceed those limits, and finally, it reserves the cases of justifi- cation arising from self-defense and from reprisals.” This same formula was proposed and discussed as one of the declarations of the rights and duties of nations at the Sixth International Conference of American States held at Habana in 1928. The authorities cite a number of cases in which self-defense and necessity have been pleaded in order to justify or excuse international conduct. Among others, the following cases have been cited: the Caroline, the Virginius, the American expeditions against the Villa forces in 1916 and 1919, the recipro- cal violation of boundaries between Greece and Bulgaria in 1919, etc. In the case of the Caroline, Mr. Webster, Secretary of State of the United States. thus expounded the doctrine of self-defense: “Undoubtedly it is just’—he stated in his note of August 6, 1842, to the British Pleninotentiary. Lord Ashburton—*“that while it is admitted 1 Von Liszt, Treatise on Penal Law, Vol. 11, p. 341. J RESPONSIBILITY OF STATES that exceptions growing out of the great law of self-defense do exist, those exceptions should be confined to cases in which the necessity of the self-defense is instant, overwhelming, and leaving no choice of means, and no moment for deliberation ” (c) The inquiry of the Preparatory Committee refers also to the pos- sible responsibility of the State for the unilateral rescission of ‘contractual abligations. This rescission might be prompted by considerations of public policy, or else it may be authorized under the terms and conditions of the contract. The State is authorized to rescind in either case. Rescission for reasons of public policy might create a duty to make reparation, and the question should be referred to the international courts for adjudication. The second case of rescission is the exercise of a usual contractual privilege. It is within the rights of every contracting party, and is governed by municipal law. Such rescission, however, like any other act of government authorities, might involve an international offence when the unilateral action of the State has exceeded the limits justified by the terms of the contract or the circum- stances of the case, or when the municipal law does not provide efficient means of redress for the injured party. al REPARATION AND JUDICIAL SETTLEMENT (a) After the substantive rules of State responsibility in connection with foreigners have been established, the codification of the international law should be supplemented by a set of fundamental rules of procedure for the enforcement of international obligations. All of these rules can be readily de- fined, inasmuch as they have been established as common usage by international practice. There is no doubt but that the States should be the ones to insti- tute the international action for the wrongs committed against their nationals. This procedure would cover amicable suggestions, requests or enjoinments, and formal claims handled through diplomatic channels. The foundation for this action on the part of the State lies upon an extant principle in the modern mind, that is very often resorted to. It is deemed that the dignity and respectability of the State would be impaired if its nationals should not be accorded proper juridical treatment. It is further deemed that nationals are units of the State, and that it is incumbent upon the State to protect them all over the world and demand from the other States proper justice for them. All of these conceptions are the remaining traces of the doctrine of the classical schools and, at the same time, a certain reminiscence of medieval tendencies. However, it is an unquestionable international fact that up to this day that is the theory entertained in the minds of the States. They claim for their nationals. They are the States’ claims and pertain to their sovereignty. It is not considered that these claims are instituted by the State under a commission from the injured person, or as his representative. The only requirement is that the victim of the international wrong should be a national of the plaintiff State. International authorities are well acquainted with the details of procedure, viz., nationality from the time that the damage was caused and until the completion of the proceedings; the effects of a change of nationality in the meantime, either voluntary or by operation of law; and the legal consequences of the death of the victim. None of these questions involve any difficulties. But it would be worth while to consider a departure from the prevailing procedure of handling claims through diplo- matic channels. Would it not constitute a principle of juridical evolution Se ¥, RESPONSIBILITY OF STATES that could be readily established, to allow private persons, in certain re- stricted instances, to institute themselves the international action, with the sanction of their governments? (b) It is recognized that among the States normal conditions disturbed by international wrongs are restored by means of satisfaction and reparation, Some of the authorities claim that there is a certain degree of similarity between these means and the repressions and indemnities provided by the municipal penal laws. Satisfaction among States is, properly speaking, only a moral or political reparation. It is applied in instances wherein it is deemed that the national honor, dignity or respectability have been injured. There is no precedent in arbitral awards expressly imposing punitive satis- faction or indemnity. On the contrary, arbitral awards contain statements that eliminate every possibility of applying punitive measures among the States. However, there have been cases in actual practice where a State has demanded punitive satisfaction or reparation and the defendant State has found it necessary to yield. It is neither advisable nor proper to cite these cases. These occurrences, however, have extrajudicial character and could not exert any influence upon codification work. There have been cases, t00, in which arbitration commissions have imposed indemnities so grossly out of proportion with the actual damage caused that they are sug- gestive of exemplary damages. The fact remains, however, that in inter- national jurisprudence there is no possibility of meting out punishment or penalties in the sense that these measures were understood in the ancient penal law. In the modern penal law the conceptions of punitive atone- ment and retribution have disappeared. 'Repressions are only exercised for the purpose of maintaining the public peace. From this point of view there is not, properly speaking, any difference between disciplination and indemnity. Each of them constitute a feature of the one conception that reparation is essential to maintain social equilibrium. (c) The work of codification should be extended so as to give inter- national character to certain principles of private jurisprudence in connection with the nature of the damage, the assessment of same, the various kinds of reparations, how these should be fixed, etc. There are certain principles that would be very useful in determining the measure of damages for which reparation should be made. The connection between the act and the damage is one of the essential elements. This connection establishes the fact that aot only should the actual material loss caused by the act be allowed, but also the loss of income that it has brought about. This is the ancient Roman interpretation of damnus emergens and lucrum cessans, which has been fol- lowed in a large number of arbitral awards. There is also a very extensive and substantial arbitral jurisprudence, although somewhat contradictory and indefinite, running from the time of the Alabama claims to the present REPARATION AND JUDICIAL SETTLEMENT 67 German-American and Mexican-American mixed claims commissions, in connection with the computation of direct and indirect damages. No definite principles can be drawn from these decisions, because of the confusion of indirect damage with damage due to complicated causes partially remote from the act involved. A great deal would be accomplished by defining these prin- ciples in a general way. Finally, the ideal aim in connection with all these problems is to place them under the obligatory jurisdiction of the international community. This is the condition that the work of codification of these principles be efficient and interesting. To leave the interpretation or application of the rules laid down to the will or judgment of the States would utterly exclude every hope for maintaining cordial international relations. On the other hand, it is well known that at the present time arbitration is a most usual procedure. It would not constitute an innovation liable to draw irremovable objections, to coordinate the principles already accepted by a large majority of the States in connection with the peaceful settlement of controversies, and to incorporate these principles in the Code of State Responsibility. This important and beneficial task could also be expedited by adopting a procedure similar to that of the Supplementary Protocol of the Permanent Court of International Justice. A Protocol covering the gradual development of obligatory inter- national jurisdiction in matters involving State responsibility might be formu- lated. This would cover the following: First: Obligatory arbitration by a Settlement Board, only of cases wherein, although responsibility has been admitted, the amount of the in- demnity remains in dispute. Or Second: Obligatory investigation by an Inquiry Commission, only of such cases wherein the truth of the facts is in dispute, which, if established. would fix responsibility. Or Third: Submitting either to arbitration or to the Permanent Court of International Justice, only the cases involving government debts and others in which there is no possibility of local means of redress under the municipal law. Or, Fourth: Either obligatory arbitration, or reference to the Permanent Court of International Justice of all cases of responsibility for damage caused to the person or property of aliens, provided that same do not also involve a direct offence to the State. Or, finally Fifth: Obligatory reference to international justice, of all cases of responsibility, irrespective of their nature. g 5 C ? os 0 Germdg 52 conned - princig ¢ ® indire] © the act, ’ ciples | Fi them is the and irl down | for mg know would] coord in con these il that of Justict nation lated. Ee where demni Cd such woul ; T Inte in w law. | FE pe oO [do] <o Oy Cour cause invol Fi respo < ~N jo ATION AND JUDICIAL SETTLEMENT 67 ‘and Mexican-American mixed claims commissions, in computation of direct and indirect damages. No definite rawn from these decisions, because of the confusion of h damage due to complicated causes partially remote from great deal would be accomplished by defining these prin- vay. il aim in connection with all these problems is to place gatory jurisdiction of the international community, This t the work of codification of these principles be efficient 0 leave the interpretation or application of the rules laid judgment of the States would utterly exclude every hope dial international relations. On the other hand, it is well present time arbitration is a most usual procedure. It e an innovation liable to draw irremovable objections, to siples already accepted by a large majority of the States he peaceful settlement of controversies, and to incorporate the Code of State Responsibility. This important and d also be expedited by adopting a procedure similar to rentary Protocol of the Permanent Court of International ol covering the gradual development of obligatory inter- in matters involving State responsibility might be formu- cover the following: ory arbitration by a Settlement Board, only of cases responsibility has been admitted, the amount of the in- dispute. Or, atory investigation by an Inquiry Commission, only of the truth of the facts is in dispute, which, if established, ility. Or ting either to arbitration or to the Permanent Court of e, only the cases involving government debts and others > possibility of local means of redress under the municipal r obligatory arbitration, or reference to the Permanent ional Justice of all cases of responsibility for damage bn or property of aliens, provided that same do not also ence to the State. Or, finally tory reference to international justice, of all cases of pective of their nature. 0 “oy ow - Fa m Pd Oo 2 mm