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Chapter 1 Cases

Chapter 1 Introduction to International and Comparative Law Case 1-1. IGNACIO SEQUIHUA V. TEXACO INC. ET AL.
United States District Court for the Southern District of Texas, 1994. FACTS: Plaintiffs, Ecuador residents, filed suit in Texas over alleged environmental damage in Ecuador. Plaintiffs pray for money damages, an injunction to clean up, and a court-administered trust fund. Defendants bring motions to dismiss. ISSUE: Should the court decline to exercise jurisdiction based on the doctrine of comity of nations? HOLDING: Yes. LAW: Section 403(3) of the Restatement (Third) of the Foreign Relations Law of the United States sets out numerous factors in deciding whether comity of nations deference should be applied. EXPLANATION: The alleged activities and harm occurred in Ecuador; plaintiffs all reside in Ecuador; defendants are not Texas residents; the Republic of Ecuador has objected to the court’s jurisdiction and would probably not enforce any judgment it issued; and jurisdiction would interfere with Ecuador’s sovereign right to control its own environment. ORDER: The case is dismissed under the doctrine of comity of nations.

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They were not meant to become rules of law. would be enforceable in the courts. violates the US Constitution. is the UN Charter automatically applicable? (3) Does the California law violate the US Constitution? HOLDING: The law violates the UN Charter and the US Constitution. (3) Treaties (such as the UN Charter) are part of American law and must be observed. CC1-2 © 2009 Pearson Education. there was no US-Japan treaty giving Japanese the right to own land in the US. Inc. but the US Constitution is. This is in contrast to the rules in the Charter dealing with rights and privileges of the officers and employees of the UN. SEI FUJII v. which is based on racial discrimination. standing alone.Chapter 1 Cases Case 1-2. it must appear that its authors meant to prescribe a rule that. publishing as Prentice Hall . The UN Charter is not self-executing. which signatories are required to observe. LAWS: (1) At the time. FACTS: A California law made land purchased by a Japanese who was ineligible for citizenship escheat to the state. (4) Treaties do not supersede inconsistent local laws unless they are self-executing. (5) To determine if a treaty is self-executing. STATE United States. (2) The UN Charter requires nations to promote human rights (including non-discrimination based on national origin). The California law. EXPLANATION: The UN Charter provisions on human rights set out goals and aspirations. one looks at the intent of the parties. ORDER: The land does not escheat to California. for a treaty provision to be operative without the aid of implementing legislation. Supreme Court of California. That is. (6) The US Constitution’s Fourteenth Amendment prohibits racial discrimination. not self-executing provisions. ISSUES: (1) Does California’s alien land law violate the UN Charter? (2) If it does. 1952. American states are bound to observe the US Constitution.

(3) Precedent and the plain language of § 1332(a)(2) require that an alien bringing suit in a US federal court must be a citizen or national of a foreign state.Y. 1997. KHALILY and D. CC1-3 © 2009 Pearson Education. (2) The law under which a corporate entity is created establishes that entity’s nationality. seeks to sue Khalily and D. v. but this requires some statement from the executive branch indicating that the executive wishes for the courts to treat the territory as a state. Even though this law is based on a UK law. publishing as Prentice Hall .” The district court dismissed plaintiff’s suit on the grounds that it was not the citizen of a foreign State.. in a US federal court. (3) No. (3) Precedent and the plain language of the § 1332(a)(2) exclude stateless persons from bringing suits in US federal courts. Matimak seeks to invoke the federal court’s diversity jurisdiction in US Code. because Hong Kong was not at the time recognized as being a foreign state by the United States government. a Hong Kong company. MATIMAK TRADING CO. KIDS SPORTSWEAR INC. a foreign state is one that is formally recognized by the US. EXPLANATION: (1) Hong Kong is not recognized as a foreign state and the US State Department has told the court that the US executive does not regard it as a state. LAW: (1) As a general rule. Inc. title 28. FACTS: Plaintiff. (2) Matimak was created as a company according to Hong Kong law.Y.A. § 1332(a)(2) to hear civil disputes between “citizens of a State and citizens of a foreign state. Matimak.A. (2) No. Second Circuit Court of Appeals.Chapter 1 Cases Case 1-3. United States. A foreign territory may also be recognized as a de facto state. that is not enough of a connection with the UK to say that Matimak is a UK company. ISSUES: (1) Is Hong Kong a state? (2) Is Matimak a citizen of the United Kingdom? (3) Does US Code. title 28. two New York corporations. § 1332(a)(2) allow stateless persons to sue in a US federal court? HOLDINGS: (1) No. ORDER: District court’s dismissal of the suit is affirmed.

. was polluting the waters of the Columbia River that then ran into the state of Washington. 1938 and 1941. FACTS: A Canadian lead and zinc smelter at Trail.” In a case decided by the Federal Court of Switzerland between two Swiss cantons. CC1-4 © 2009 Pearson Education.000 in damages. It said: “This right [sovereignty] excludes . THE TRAIL SMELTER ARBITRATION (United States v.” Cases decided by the US Supreme Court (which may by analogy be applied in the international arena) have held that no state has the right to use or permit the use of its territory in such a manner as to cause injury by fumes in or to the territory of another or the properties or persons therein. The Commission’s Arbitral Tribunal awarded the US $350.. British Columbia. when the consequences are serious and the injury is established by clear and convincing evidence. After negotiations between the US and Canada. EXPLANATION: Canada is responsible in international law for the conduct of the Trail Smelter. ISSUE: Can Canada be enjoined from causing harm to a US river? HOLDING: Canada may be enjoined from polluting US rivers. the latter agreed to refer the matter to an International Joint Commission.. but did not order the smelter to cease operating. ORDER: Canada must undertake to stop the pollution caused by the smelter at Trail.Chapter 1 Cases Case 1-4. British Columbia. publishing as Prentice Hall . but also an actual encroachment which might prejudice the natural use of the territory and the free movement of its inhabitants. Canada) Canadian-United States International Joint Commission. not only the usurpation and exercise of sovereign rights [of another state] .. Arbitral Tribunal. LAW: International law establishes that “A state owes at all times a duty to protect other states against injurious acts by individuals from within its jurisdiction. it enjoined the use of a shooting establishment that had endangered the territory of the other. Inc. In 1941. the US sought to have the operation of the smelter enjoined.

be prohibited between member States. which provides. “Quantitative restrictions on imports and all measures having equivalent effect shall. ISSUE: Do any of the justifications advanced by Germany allow the Meat Regulation to be upheld as a valid restraint on trade? HOLDING: No.” Council Directive 79/112 allows Member States to have “detailed rules for the labelling of foodstuffs offered for sale to the ultimate consumer without pre-packaging” for purposes of consumer protection and avoiding confusion.” ORDER: The declaration is made that Germany failed to fulfil its EEC Treaty obligations under Article 30. LAW: Import restrictions to protect human life and health are allowed “if that objective cannot be achieved by measures less restrictive of intraCommunity trade. CC1-5 © 2009 Pearson Education. Inc. prohibiting the importation and “marketing of meat products which contain ingredients other than meat. “[N]ational measures may not conflict with … the fundamental principles of the Community—in this case of the free movement of goods—unless they are justified by reasons recognized by Community law.” EXPLANATION: Germany’s explanations for the Meat Regulation are rejected as not complying with its treaty obligations under Article 30 of the EEC Treaty.Chapter 1 Cases Case 1-5. without prejudice to the following provisions. Case 274/87.” fails to fulfil Germany’s obligation under Article 30 of the EEC Treaty. publishing as Prentice Hall . FEDERAL REPUBLIC OF GERMANY Court of Justice of the European Communities. COMMISSION OF THE EUROPEAN COMMUNITIES V. FACTS: Commission of the European Communities brought suit for a declaration that Germany’s Meat Regulation.

Sanchez. and the matter is regarded in international law as a purely domestic affair. she appealed. Fifth Circuit. Inc. ISSUE: May an individual who is a national of a foreign state sue an agency of that foreign state in another state’s courts for an alleged contractual breach? HOLDING: No. was the payee on a check issued by the Central Bank of Nicaragua. Sanchez than brought in suit to force the Banco Central to honor the check (which was drawn on a US bank). Following the fall of the Somoza government. When the trial court dismissed Mrs. 1985. Mrs. then no other state’s interest is involved. Mrs. Court of Appeals. BANCO CENTRAL DE NICARAGUA United States. otherwise there might be no internal matter that would not be immune from foreign scrutiny. Somoza’s suit. FACTS: Mrs. the wife of the then foreign minister of the Somoza government in Nicaragua. Sanchez was unable to cash the check because the new government put a stop-payment order on it. publishing as Prentice Hall . LAW: As long as a state injures only its own nationals. This doctrine rests on the fundamental principle that one state will not inquire into the internal affairs of another. CC1-6 © 2009 Pearson Education. ORDER: Decision dismissing the case is affirmed.Chapter 1 Cases Case 1-6. EXPLANATION: Government expropriation is not so universally abhorred that its prohibition commands the general assent of civilized nations. DE SANCHEZ v.

LIAMCO took the matter to arbitration. GOVERNMENT OF THE LIBYAN ARAB REPUBLIC Dr. 1977. Sole Arbitrator. ORDER: Libya had breached its concession contract. When no compensation was received (despite promises). Libya. both systems of law recognize the sanctity of contracts. ISSUE: Is a sovereign bound by its contractual commitments? HOLDING: A sovereign is bound by its contractual commitments. EXPLANATION: The concession agreement provided that the law of Libya (not in conflict with international law) was to govern. Both international law and Libyan law recognize statutes. seeking compensation for its lost properties.677 in damages. publishing as Prentice Hall . Customary international law recognizes that states can be bound to an arbitration agreement (see the Convention creating ICSID for example). Similarly. Inc. CC1-7 © 2009 Pearson Education. Both recognize the sanctity of contracts. informed all its concessionaires that it rejected arbitration as an affront to its sovereignty and it refused to participate in this proceeding. custom. Islamic law also recognizes arbitration (the Prophet Muhammad having served as an arbitrator and having used arbitration to resolve a dispute during his lifetime). Sobhi Mahmassani. LIBYAN AMERICAN OIL COMPANY (LIAMCO) v.Chapter 1 Cases Case 1-7.” Islamic law also provides that cancellation of a contract is not valid except by mutual consent. LAW: International law and Libyan law are similar in the sources of authority they look to. Both recognize arbitration.085. International law obeys the Latin maxim pacta sunt servanda (pacts are to be observed) and a tradition of the Prophet provides that “Muslims are bound by their stipulations. meanwhile. FACTS: The Libyan American Oil Company’s (LIAMCO’s) oil concessions in Libya were nationalized in 1973. and equity as sources of law. LIAMCO was entitled to US $80.