1 The Nottebohm Case (Liechtenstein v. Guat.), Second Phase, 1955 ICJ Rep. 4 (Judgment of Apr. 6), and Barcelona Traction, Light & Power Co., Ltd. (Belg. v. Spain) (New Application), 1970 ICJ Rep. 4 (Judgment of Feb. 5), stand out as rare postwar examples of resort to the International Court of Justice for the adjudication of international claims. The United States recently instituted proceedings against Italy in the Raytheon case, which will be decided by a five-judge Chamber of the Court. See Elettronica, Sicula S.p.A. (ELSI), Constitution of Chamber, 1987 Google Scholar ICJ Rep. 3 (Order of Mar. 2).

2 Declaration of the Government of the Democratic and Popular Republic of Algeria Concerning the Settlement of Claims by the Government of the United States of America and the Government of the Islamic Republic of Iran, reprinted in 75 AJIL 422 (1981), 20 ILM 230 (1981). See generally The Iran-United States Claims Tribunal 1981–1983 (R. Lillich ed. 1984).

3 For relevant discussion, see Lillich, R. International Claims: Their Adjudication by National Commissions (1962)Google Scholar.

4 For relevant discussion, see Lillich, R. International Claims: Postwar British Practice (1967)Google Scholar.

5 For relevant discussion, see Weston, B. International Claims: Postwar French Practice (1971)Google Scholar.

6 Agreement with Great Britain, Nov. 19, 1794, 8 Stat. 116, TS No. 105. When one of the three international claims commissions established under the Jay Treaty broke down, Great Britain and the United States negotiated the first modern lump sum agreement. Agreement with Great Britain, Jan. 8, 1802, 8 Stat. 196, TS No. 108.

7 See R. Lillich, supra note 3; Lillich, R. & Christenson, G. International Claims: Their Preparation and Presentation (1962)Google Scholar; R. Lillich, supra note 4; and B. Weston, supra note 5. See also International Claims: Contemporary European Practice (R. Lillich & B. Weston eds. 1982).

8 See Lillich, R. & Weston, B. International Claims: Their Settlement by Lump Sum Agreements (2 vols. 1975)Google Scholar.

9 These lump sum agreements are listed in the appendix to this Note. The authors would welcome copies of, or citations to, others they may have overlooked.

10 1970 ICJ Rep. at 40. See Lillich, The Rigidity of Barcelona, 65 AJIL 522 (1971)Google Scholar. See also Round, Table Toward More Adequate Diplomatic Protection of Private Claims: “Aris Gloves,” “Barcelona Traction,” and Beyond, 65 ASIL Proc. 333 (1971)Google Scholar.

11 See infra text accompanying notes 13–33.

12 l R. Lillich & B. Weston, supra note 8, at 43.

13 658 F.2d 875 (2d Cir. 1981). See Note, International Law: An “Appropriate” Compensation Standard for Nationalized Property: Banco Nacional de Cuba v. Chase Manhattan Bank, 66 Minn. L. Rev. 931(1982).

14 See Rabinowitz, , The Impact of the Cuban Nationalizations on Compensation and Valuation Standards, in 4 The Valuation of Nationalized Property in International Law 133, 143–44 (R. Lillich ed. & contrib. 1987)Google Scholar [hereinafter Valuation]. The first of the undersigned was called by Cuba as an expert witness on negotiated settlements and lump sum agreements. Id. at 143 n.38.

15 658 F.2d at 892.

16 Id.

17 Cf, e.g., In the Matter of an Arbitration Between the Government of the State of Kuwait and the American Independent Oil Co. (AMINOIL), 21 ILM 976, 1036–37 (1982).

18 Case No. 129, [Interlocutory Award No.] ITL 59-129-3 (Mar. 27, 1986) (Chamber 3), reprinted in 25 ILM 629 (1986).

19 Id., 25 ILM at 633 (citing Barcelona Traction, supra note 1, and AMINOIL, supra note 17).

20 25 ILM at 641–42 (Brower, Arb., sep. op.). In a footnote he reiterated that “such settlements are suspect as guides to the substance of customary international law.” Id. at 642 n.11.

21 Id. at 642 (citing Seidl-Hohenveldern, Austrian Practice on Lump Sum Compensation by Treaty, 70 AJIL 763, 766–67 (1976)Google Scholar, who made this point in connection with the Austrian-Italian Agreement of July 17, 1971, 1973 Bundesgesetzblatt No. 635, reprinted in 1 R. Lillich & B. Weston, supra note 8, at 319).

22 8 Iran-U.S. Claims Tribunal Rep. [hereinafter Iran-U.S. C.T.R.] 373 (1985 I).

23 See Schachter, Compensation for Expropriation, 78 AJIL 121, 126 (1984)Google Scholar.

24 8 Iran-U.S. C.T.R. at 399 (citing and quoting Barcelona Traction, supra note 1, AMINOIL, supra note 17, and Chase Manhattan Bank, supra note 13).

25 4 Iran-U.S. C.T.R. 96 (1983 III).

26 Id. at 116 n.1 (Mosk, Arb., concurring).

27 Id.

28 Thus, the reporters of the American Law Institute’s new Restatement find their juridical impact “ambiguous.” Restatement of Foreign Relations Law of the United States (Revised) §712 Reporters’ Note 1, at 131 (Tent. Draft No. 7, 1986) [hereinafter Restatement (Revised)].

29 Clagett, Just Compensation in International Law: The Issues Before the Iran-United States Claims Tribunal, in 4 Valuation, supra note 14, at 31, 78 Google Scholar (later citing Barcelona Traction, supra note 1, and Chase Manhattan Bank, supra note 13).

30 Id. at 78–79 (citing Barcelona Traction, supra note 1, and Chase Manhattan Bank, supra note 13).

31 Article 2(2)(c) of the Charter of Economic Rights and Duties of States, GA Res. 3281, 29 UN GAOR Supp. (No. 31) at 50, UN Doc. A/9631 (1975), unconditionally endorsed by Sornarajah, purports to “codify” this view. For a comprehensive, contextual critique of the issue in general and Article 2(2)(c) in specific, see Weston, , The New International Economic Order and the Deprivation of Foreign Proprietary Wealth: Some Reflections upon the Contemporary International Law Debate, in International Law of State Responsibility for Injuries to Aliens 89 (R. Lillich ed. & contrib. 1983)Google Scholar [hereinafter Weston in State Responsibility], a revised version of The Charter of Economic Rights and Duties of States and the Deprivation of Foreign-Owned Wealth, 75 AJIL 437 (1981).

32 Sornarajah, M. The Pursuit of Nationalized Property 215 (1986)Google Scholar.

33 Id. at 216–17.

34 Friedman, S . Expropriation in International Law 221 (1953)Google Scholar. Cf. Knapp, Comment, 48 Int’l L. Ass’n Rep. 177 (1958).

35 See 1 R. Lillich & B. Weston, supra note 8, at 248–49.

36 In Jiménez de Aréchaga’s view, lump sum agreements demonstrate “that the legal foundation of the payment of compensation in the event of nationalization must be looked for in certain legal principles different from the classical doctrine.” Jiménez, de Aréchaga International Law in the Past Third of a Century, 159 Recueil Des Cours 1, 299 (1978 I)Google Scholar.

37 According to Chowdhury:

An empirical survey shows that a large number of agreements of the lump sum type were concluded which did not follow the Hull rule . . . .

. . . [Although the forms of the lump sum agreements in the postwar period vary considerably, the general trend seems to establish that none of the three components of the Hull rule, i.e. promptness, adequacy and effectiveness, was followed by and large in postwar state practice. On the contrary, the trend indicates the adoption of partial and negotiated compensation arrangements, depending upon the circumstances of each case.

Chowdhury, , Permanent Sovereignty and Its Impact on Stabilization Clauses, Standards of Compensation and Patterns of Development Co-operation, in Permanent Sovereignty Over Natural Resources in International Law: Principle and Practice 42, 59–60 (K. Hossain & S. R. Chowdhury eds. 1984)Google Scholar.

38 Professor Garcia-Amador has stated the following:

[L]ump sum agreements, far from envisaging “just” or “adequate” compensation, provided for “partial” negotiated indemnification, the amount of which varied appreciably depending on the circumstances. In the case of lump sum agreements, there is no absolute uniformity with regard to the rule followed in valuing the property and determining the amount of compensation, which is understandable in view of the diversity of the situations giving rise to this type of international settlement.

García-Amador, The Proposed New International Economic Order: A New Approach to the Law Governing Nationalization and Compensation, 12 Law. Am. 1, 46–47 (1980)Google Scholar (footnote omitted).

39 See note 31 supra.

40 Indeed, to the extent that they suggest that the conclusion of many inadequate lump sum agreements has helped to establish a partial compensation norm, they obviously regard them as not only principle-reinforcing, but also norm-creating. For our views, rejecting a partial compensation rule but nevertheless recognizing that the impact of lump sum agreements upon the amount-of-compensation issue cannot be dismissed out of hand, see 1 R. Lillich & B. Weston, supra note 8, at 247–56. Our views obviously conflict with the ones held by both Clagett and Sornarajah. Cf id. at 259:

Regardless of one’s leanings in the oft-heated debate over whether international law requires “prompt, adequate and effective” compensation or no compensation at all upon the major deprivation of foreign-owned wealth, few will find complete satisfaction in [our views]. The reason is that lump sum settlement practice has undeniably compromised the polar policy preferences advanced in this connection.

41 Dolzer, New Foundations of the Law of Expropriation of Alien Property, 75 AJIL 553, 559–60 (1981)Google Scholar (emphasis added) (footnotes omitted).

42 Pechota, The 1981 U.S.-Czechoslovak Claims Settlement Agreement: An Epilogue to Postwar Nationalization and Expropriation Disputes, 76 AJIL 639 (1982)Google Scholar. The treaty in question is the Agreement on the Settlement of Certain Outstanding Claims and Financial Issues, Jan. 29, 1982, Czechoslovakia-United States, reprinted in 21 ILM 371 (1982).

43 Stevenson, Comment, 54 ASIL Proc. 111, 112 (1960).

44 Pechota, supra note 42, at 642–43 (emphasis added).

45 Weston in State Responsibility, supra note 31, at 106. As Judge Baxter, writing about lump sum agreements nearly two decades ago, remarked, “If some compensation is always paid, this may furnish proof that compensation must be paid in some degree and that nationalization without compensation is unlawful.” Baxter, Treaties and Custom, 129 Recueil des Cours 25, 87 (1970 I)Google Scholar.

46 The adjective “just,” long preferred by us for its relatively value-free connotations, is now found in §712(1) of the American Law Institute’s new Restatement. For some thoughts on the elements constituting just compensation, see Restatement (Revised), supra note 28, §712 comment d, at 122–23. See also Lillich, The Valuation of Nationalized Property in International Law: Toward a Consensus or More “Rich Chaos”?, in 3 Valuation, supra note 14, at 183, 195–204 (R. Lillich ed. & contrib. 1975)Google Scholar.

47 See generally 1–4 Valuation, supra note 14 (R. Lillich ed. & contrib. 1972, 1973, 1975 & 1987).

48 See 1 R. Lillich & B. Weston, supra note 8, at 247–56.

49 Thus, Pechota predicted that the U.S.-Czech Agreement of 1981 would generate more than 100% of certified U.S. claims, plus some interest, an “unprecedented” amount. Pechota, supra note 42, at 640. Although it seems that the actual figure is closer to 71%, Foreign Claims Settlement Commission of the United States, 1985 Ann. Rep. 43, it still represents a considerable improvement in the amount obtained compared to the record of recovery until 1975.

50 Although the Tribunal has not invoked lump sum agreements directly, it has made use of them indirectly through resort to the jurisprudence of the Foreign Claims Settlement Commission of the United States, which adjudicates claims following the conclusion of U.S. lump sum agreements, the model for many of the provisions of the Claims Settlement Agreement. See, e.g., International Schools Services, Inc. v. National Iranian Copper Industries Co., 5 Iran-U.S. C.T.R. 338, 346 n.1 (1984 I).