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Case 2-1: Sandline International Inc. v.

Papua New Guinea

Issue: Is PNG liable for its failure to perform the terms of the contract?
Holding: Yes.
Rule: An agreement between a private party and a state is an international, not a domestic, contract,
thus the rules of international law apply. Acts of a state will be regarded as such even if they are ultra
vires or unlawful under the internal law of the state. Under the doctrine of preclusion or ratification, a
party may not deny the validity of a contract entered into on its behalf by another, if, by its conduct, it
later consents to the contract.
Analysis/ Application: PNG affirmed that the performing of contact was frustrated by later events
(Insurrection) and counterclaiming on that basis. PNG did not deny the existence of the contract. Hence,
the contract is valid. This means, PNG is responsible for its contractual liability between Sandline.
Conclusion: Yes, the contract between PNG and Sandline remain valid under international law. PNG
should pay remaining $18 million to Sandline, since PNG is liable for its failure to perform the terms of
the contract.

Case 2-2: Flatow v. The Islamic Republic of Iran

Issue: Will the court enter the judgement against Iran as a foreign state? Can the plaintiff recover
damages for the death of his daughter?
Rule: As with actions against the Federal government, The Foreign Sovereign Immunities act requires
that a default judgement against a foreign state be entered only after a Plaintiff establishes his claim or
right to relief by evidence that is satisfactory to the court.
Analysis: This suicide bombing was an extrajudicial killing as it was not authorized by a court and it was
done in support of international terrorism. Irans general support of the bombers group was sufficient to
establish liability as a foreign states support of an actor does not have to be directly linked to the
extrajudicial killing. Funds supplied to a group by a governments head of state, intelligence service, and
minister of intelligence is the provision of material support and resources.
Conclusion: The court held that the plaintiff had established his claim or right to relief from the
defendants, the Islamic republic of Iran and ministry of information and security are jointly liable for all
damages awarded by court to the plaintiff.

Case 2-4: Chattin v. United Mexican States

Issue: Had Chattin been denied Justice?
Rule: A delinquency represents a violation of the international standards. Equality of treatment doctrine
states that a state should treat an alien exactly as it treats its own nationals, no better no worse.
Analysis: There was evidence of undue delay in allowing Chattin to respond to the allegations and
evidence against him, and in forwarding his appeal to the appellate court. There was evidence that Chattin
had not been informed of the charges brought against him or allowed to face his accusers. The manager of
the railroad was allowed to submit a series of anonymous written accusations that were only included in
the record after the investigations were over and Chattins lawyer had filed his briefs. There was evidence
that the hearing was only a formality that lasted five minutes. This constituted treatment amounting to an
outrage, to bad faith, to willful neglect of duty, or to an insufficiency of governmental action that is
recognizable by every unbiased man. There was no evidence to support the other allegations (e.g., bias by
the judge and ill treatment in the prison).
Conclusion: Mexican authorities violated the international standards of care. Mr. Chattins arrest was not
proven illegal. Inhuman treatment in jail was not proven. As a result, Chattin was awarded $5,000 in

Case 3-1: Japan- Taxes on Alcoholic Beverages

Issue: Are the products which are the subject of this dispute similar? Is Japan violating the treatment
principle that is it discriminating against imported products in favor of domestic products by taxing the
imports at a higher rate?
Rule: As Japan is a member of WTO, Article 3 of GATT 1994 applies to this case.
Analysis: According to japan the purpose of tax classification under the liquor tax law is not afford
protection does not have the effect of protecting domestic production. However, the spirits like vodka and
rum are same products as the Japanese liquors so higher taxes should not be imposed on them.
Conclusion: The panel held that the Japanese Liquor tax law violates GATT 1994 as the higher tax rate
only applies on the different category of products but not on the products which are similar, directly
competitive or substitute products.

Case3-7: Bank of India v. Gobindram

Issue: Whether Japanese law is the proper law of the contract of guarantee.
Rule: The general rule is that the Court should apply the law of the state that has
the closest and most real connection with the dispute, as long as the expressed or
inferred intention as to the proper law is absent.

Analysis: The Bank of India, the plaintiff, argues that either Indian or Hong Kong
law should apply based on the inferred nature of the contract. The Gobindrams, the
defendants, argue that Japanese law should be used for the guarantee contract,
based on the closest and most real connection. Moreover, Japanese law protects
them from liability because the Bank of India agreed to release them as guarantors.
Conclusion: The proper law of the contract of guarantee has to be Japanese law,
and Japanese law already excused the Gobindrams from liability.

Case 3-8: Jorge Luis Machuca Gonzalez et al. v. Chrysler Corporation et al.