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CASE CONCERNING BARCELONA TRACTION, LIGHT, AND POWER CO, LTD

(Belgium v. Spain)
FACTS
Barcelona Traction, Light, and Power Company, Ltd was a corporation incorporated in
Canada, with Toronto headquarters, that made and supplied electricity in Spain. It had issued
bonds to non-Spanish investors, but during the Spanish Civil War (1936-1939) the Spanish
government refused to allow BTLP to transfer currency to pay bondholders the interest they were
due.
In 1948 a group of bondholders sued in Spain to declare that BTLP had defaulted on the
ground it had failed to pay the interest. The Spanish court allowed their claim. The business was
sold, the surplus distributed to the bondholders, and a small amount was paid to shareholders.
The shareholders in Canada succeeded in persuading Canada and other states to complain that
Spain had denied justice and violated a series of treaty obligations. However, Canada eventually
accepted that Spain had the right to prevent BTLP from transferring currency and declaring
BTLP bankrupt.
Of the shares, 88 per cent were owned by Belgians, and the Belgian government
complained, insisting the Spanish government had not acted properly. They made an initial claim
at the International Court of Justice in 1958, but later withdrew it to allow negotiations.
Subsequent negotiations broke down, and a new claim was filed in 1962. Spain contended that
Belgium had no standing because BTLP was a Canadian company.
ISSUE
Whether or not Belgium has a locus standi to sue Spain in behalf of their citizens.
HELD
The International Court of Justice held that Belgium had no legal interest in the matter to
justify it bringing a claim. Although Belgian shareholders suffered if a wrong was done to the
company, it was only the company's rights that could have been infringed by Spain's actions.It
was a general rule of international law that when an unlawful act was committed against a
company, only the state of incorporation of the company could sue. The BLTP which was
incorporated in Canada has a separate and distinct personality from its shareholders who holds
different nationalities. It is only Canada that can sue Spain but since they chose not to, it was
already the end.
CAIRE CLAIM, FRANCE V. MEXICO, FRENCH-MEXICAN CLAIMS

FACTS

December 11, 1914, Jean-Baptiste Caire, a French National, was killed by two Mexican army
officers within the premises of the army barracks due to the refusal of the former to pay a sum of
money in favor of the latter.

ISSUE

Whether or not Mexico should be held liable for the acts committed by its military personnel
acting without color of authority?

HELD

YES. It was held that Mexico was internationally responsible for the acts committed by its
officers. The court used the doctrine of objective responsibility wherein the state should be held
liable for acts committed by its officials or state organs notwithstanding the absence of fault on
the part of the state.

By committing the said act, the Mexican army officers made their state accountable for such act,
regardless they acted in their official capacity as officers of the state or not when they tried to
extort money and killed Caire,
NORTH AMERICAN DREDGING COMPANY OF TEXTS (U.S.A.) V. UNITED
MEXICAN STATES

31 March 1926

JURISDICTION CALVO CLAUSE. A Calvo clause held to bar claimant from presenting to
his Government any claim connected with the contract in which it appeared and hence to place
any such claim beyond the jurisdiction of the tribunal. The clause will not preclude his
Government from espousing, or the tribunal from considering, other claims based on the
violation of international law. Article V of the compromise held not to prevent the foregoing
result.

CONTRACT CLAIMS. Motion to dismiss, for lack of jurisdiction, claim based on non-
performance of a contract with Mexican Government rejected.

FACTS

The Government of Mexico entered a contract of dredging with The North American Dredging
Company (NADC) on November 12, 1912 in Mexico City. NADC was supposed to render
services in Mexico, and the payment was to be rendered therein. Thereafter, the United States of
America, in behalf of the North American Dredging Company of Texas, filed for the recovery of
the sum of $233,523.30 with interest and damages for an alleged breach in the contract of
dredging at the port of Salina Cruz. The case was filed with the General Claims Commission.

Mexico, represented by its agent, filed a motion to dismiss on the ground of a particular clause in
the contract, known as the Calvo Clause, wherein it states that the signing party agrees to reduce
or waive its rights as an alien or a foreign body or person and is subject to the local rights and
privileges provided by the host country, Mexico.

ISSUES

Whether or not the Calvo Clause deprives the party subscribing said clause of the right to submit
any clams connected with his contract to an international commission? And if so, does the
Commission have jurisdiction over the case?

RULING

Yes, while it is true that a state cannot subvert international law by providing incongruent laws,
the Calvo clause serves as an exception. The questioned clause serves as a precondition to
awarding a contract to foreign corporations, such as the petitioner, which the state protects itself
and its interest by holding that as a condition to allow the corporation to proceed with its venture,
the corporation agrees to have and avail of the same rights and privileges that the state equally
provides to its residents, and in case of any controversy, the corporation agrees to avail the
remedies available to the local tribunals and courts in the state without the corporations home
countrys intervention. The purpose of such a contract is to draw a reasonable and practical line
between Mexico's sovereign right of jurisdiction within its own territory, on the one hand, and
the sovereign right of protection of the Government of an alien whose person or property is
within such territory, on the other hand. Unless such line is drawn and if these two coexisting
rights are permitted constantly to overlap, continual friction is inevitable. The Calvo clause is a
valid exercise of a states sovereignty where it serves as a demarcation between the sovereignty
of a state and international law.

While it is true that the country of the injured individual, or in this case a corporation, may bring
the matter to an international tribunal to redress a lawful wrong, the state cannot strike down a
lawful contract entered into by its corporation as a matter of protection, as the corporation agreed
to be bound by the law of the contracting state. It being impossible to prove the illegality of the
said provision, by adducing generally recognized rules of positive international law; it apparently
can only be contested by invoking its incongruity to the law of nature and its inconsistency with
inalienable, indestructible, imprescriptible, uncurtailable rights of nations. However, it should be
stressed that the Calvo Clause is not absolute and should be tried on attending circumstances, and
will be tried and decided on the merits.

The Commission may take jurisdiction on the case, notwithstanding the existence of such a
clause in a contract subscribed by such claimant. But where a claimant has expressly agreed in
writing, attested by his signature, that in all matters pertaining to the execution, fulfillment, and
interpretation of the contract he will have resort to local tribunals, remedies, and authorities and
then willfully ignores them by applying in such matters to his Government, said claimant will be
held bound by his contract and the Commission will not take jurisdiction of such claim.
THE WORLD HEALTH ORGANIZATION and DR. LEONCE VERSTUYFT, petitioners,
vs.
HON. BENJAMIN H. AQUINO, as Presiding Judge of Branch VIII, Court of First
Instance of Rizal, MAJOR WILFREDO CRUZ, MAJOR ANTONIO G. RELLEVE, and
CAPTAIN PEDRO S. NAVARRO of the Constabulary Offshore Action Center
(COSAC), respondents.

Facts

This case arose upon respondent judges refusal to quash a search warrant for the search
and seizure of personal effects of petitioner official, Dr. LeonceVerstufyt, of the World Health
Organization (WHO) notwithstanding his being entitled to diplomatic immunity as duly
recognized by the Executive Department of the Philippine Government. The basis of the
immunity is the Host Agreement executed by the Philippine Government and the WHO.
The grounds for issuance of search warrant instituted by COSAC was that they "contain
large quantities of highly dutiable goods" beyond the official needs of said petitioner "and the
only lawful way to reach these articles and effects for purposes of taxation is through a search
warrant."

Issue

Whether or not respondent judge committed grave abuse of discretion in issuing the
search warrant on the ground that petitioner official is entitled to diplomatic immunity?

Held

Yes, respondent judge committed grave abuse of discretion.


The executive branch of the Philippine Government has expressly recognized that
petitioner is entitled to diplomatic immunity, pursuant to the provisions of the Host Agreement. It
is a recognized principle of international law and under Philippine system of separation of
powers that diplomatic immunity is essentially a political question and courts should refuse to
look beyond a determination by the executive branch of the government, and where the plea of
diplomatic immunity is recognized and affirmed by the executive branch of the government as in
the case at bar, it is then the duty of the courts to accept the claim of immunity.
US V IRAN

On 4 November 1979 there was an armed attack by Iranian students on the United States
Embassy in Tehran and they overtook it. The students, belonging to the Muslim Student
Followers of the Imam's Line, did this as an act of support to the Iranian Revolution. More than
sixty American diplomats and citizens were held hostage for 444 days (until January 20, 1981).
Some of the hostages were released earlier, but 52 hostages were held hostage until the end.
Although Iran had promised protection to the U.S. Embassy, the guards disappeared during the
takeover and the government of Iran did not attempt to stop it or rescue the hostages. The U.S.
arranged to meet with Iranian authorities to discuss the release of the hostages, but Ayatollah
Khomeini (the leader of the Iranian Revolution) forbid officials to meet them. The U.S. ceased
relations with Iran, stopped U.S. exports, oil imports, and Iranian assets were blocked.

Judgments[edit]
The first decision was an Order of Provisional Measures, issued December 15, 1979. This was
the court issuing an opinion not on the merits underlying the case specifically, but rather ordering
a preservation of the respective rights and obligations the two countries owed one another
pending the final decision of the court. More specifically, the Court unanimously declared Iran
should ensure the restoration of the U.S. embassy in Tehran to U.S. possession, release the
hostages, and afford diplomatic officials full protections as afforded by international law.

The second decision addressed the actual merits of Iran's actions. Iran took no part in the
proceedings.

The case was the first real instance of the Court and the Security Council acting together to bring
a crisis to an end.

The ICJ considered the case in hand in two phases. The first phase referred to the armed attack
on the US Embassy in Tehran by militants and students of Iran. The question asked was whether
the militants and the students were 'agents' of the Iranian Government and therefore, acting on
their behalf. The second phase comprises the whole series of facts which occurred following the
completion of the occupation of the US Embassy by militants and the seizure of the Consulates.

The Court reached a judgement on 24 May 1980.[1]

CASE CONCERNING BARCELONA TRACTION, LIGHT, AND POWER CO, LTD


(Belgium v. Spain)
FACTS
Barcelona Traction, Light, and Power Company, Ltd was a corporation incorporated in
Canada, with Toronto headquarters, that made and supplied electricity in Spain. It had issued
bonds to non-Spanish investors, but during the Spanish Civil War (1936-1939) the Spanish
government refused to allow BTLP to transfer currency to pay bondholders the interest they were
due.
In 1948 a group of bondholders sued in Spain to declare that BTLP had defaulted on the
ground it had failed to pay the interest. The Spanish court allowed their claim. The business was
sold, the surplus distributed to the bondholders, and a small amount was paid to shareholders.
The shareholders in Canada succeeded in persuading Canada and other states to complain that
Spain had denied justice and violated a series of treaty obligations. However, Canada eventually
accepted that Spain had the right to prevent BTLP from transferring currency and declaring
BTLP bankrupt.
Of the shares, 88 per cent were owned by Belgians, and the Belgian government
complained, insisting the Spanish government had not acted properly. They made an initial claim
at the International Court of Justice in 1958, but later withdrew it to allow negotiations.
Subsequent negotiations broke down, and a new claim was filed in 1962. Spain contended that
Belgium had no standing because BTLP was a Canadian company.
ISSUE
Whether or not Belgium has a locus standi to sue Spain in behalf of their citizens.
HELD
The International Court of Justice held that Belgium had no legal interest in the matter to
justify it bringing a claim. Although Belgian shareholders suffered if a wrong was done to the
company, it was only the company's rights that could have been infringed by Spain's actions.It
was a general rule of international law that when an unlawful act was committed against a
company, only the state of incorporation of the company could sue. The BLTP which was
incorporated in Canada has a separate and distinct personality from its shareholders who holds
different nationalities. It is only Canada that can sue Spain but since they chose not to, it was
already the end.

CAIRE CLAIM, FRANCE V. MEXICO, FRENCH-MEXICAN CLAIMS

FACTS
December 11, 1914, Jean-Baptiste Caire, a French National, was killed by two Mexican army
officers within the premises of the army barracks due to the refusal of the former to pay a sum of
money in favor of the latter.

ISSUE

Whether or not Mexico should be held liable for the acts committed by its military personnel
acting without color of authority?

HELD

YES. It was held that Mexico was internationally responsible for the acts committed by its
officers. The court used the doctrine of objective responsibility wherein the state should be held
liable for acts committed by its officials or state organs notwithstanding the absence of fault on
the part of the state.

By committing the said act, the Mexican army officers made their state accountable for such act,
regardless they acted in their official capacity as officers of the state or not when they tried to
extort money and killed Caire,

NORTH AMERICAN DREDGING COMPANY OF TEXTS (U.S.A.) V. UNITED


MEXICAN STATES

31 March 1926
JURISDICTION CALVO CLAUSE. A Calvo clause held to bar claimant from presenting to
his Government any claim connected with the contract in which it appeared and hence to place
any such claim beyond the jurisdiction of the tribunal. The clause will not preclude his
Government from espousing, or the tribunal from considering, other claims based on the
violation of international law. Article V of the compromise held not to prevent the foregoing
result.

CONTRACT CLAIMS. Motion to dismiss, for lack of jurisdiction, claim based on non-
performance of a contract with Mexican Government rejected.

FACTS

The Government of Mexico entered a contract of dredging with The North American Dredging
Company (NADC) on November 12, 1912 in Mexico City. NADC was supposed to render
services in Mexico, and the payment was to be rendered therein. Thereafter, the United States of
America, in behalf of the North American Dredging Company of Texas, filed for the recovery of
the sum of $233,523.30 with interest and damages for an alleged breach in the contract of
dredging at the port of Salina Cruz. The case was filed with the General Claims Commission.

Mexico, represented by its agent, filed a motion to dismiss on the ground of a particular clause in
the contract, known as the Calvo Clause, wherein it states that the signing party agrees to reduce
or waive its rights as an alien or a foreign body or person and is subject to the local rights and
privileges provided by the host country, Mexico.

ISSUES

Whether or not the Calvo Clause deprives the party subscribing said clause of the right to submit
any clams connected with his contract to an international commission? And if so, does the
Commission have jurisdiction over the case?

RULING

Yes, while it is true that a state cannot subvert international law by providing incongruent laws,
the Calvo clause serves as an exception. The questioned clause serves as a precondition to
awarding a contract to foreign corporations, such as the petitioner, which the state protects itself
and its interest by holding that as a condition to allow the corporation to proceed with its venture,
the corporation agrees to have and avail of the same rights and privileges that the state equally
provides to its residents, and in case of any controversy, the corporation agrees to avail the
remedies available to the local tribunals and courts in the state without the corporations home
countrys intervention. The purpose of such a contract is to draw a reasonable and practical line
between Mexico's sovereign right of jurisdiction within its own territory, on the one hand, and
the sovereign right of protection of the Government of an alien whose person or property is
within such territory, on the other hand. Unless such line is drawn and if these two coexisting
rights are permitted constantly to overlap, continual friction is inevitable. The Calvo clause is a
valid exercise of a states sovereignty where it serves as a demarcation between the sovereignty
of a state and international law.

While it is true that the country of the injured individual, or in this case a corporation, may bring
the matter to an international tribunal to redress a lawful wrong, the state cannot strike down a
lawful contract entered into by its corporation as a matter of protection, as the corporation agreed
to be bound by the law of the contracting state. It being impossible to prove the illegality of the
said provision, by adducing generally recognized rules of positive international law; it apparently
can only be contested by invoking its incongruity to the law of nature and its inconsistency with
inalienable, indestructible, imprescriptible, uncurtailable rights of nations. However, it should be
stressed that the Calvo Clause is not absolute and should be tried on attending circumstances, and
will be tried and decided on the merits.

The Commission may take jurisdiction on the case, notwithstanding the existence of such a
clause in a contract subscribed by such claimant. But where a claimant has expressly agreed in
writing, attested by his signature, that in all matters pertaining to the execution, fulfillment, and
interpretation of the contract he will have resort to local tribunals, remedies, and authorities and
then willfully ignores them by applying in such matters to his Government, said claimant will be
held bound by his contract and the Commission will not take jurisdiction of such claim.

THE WORLD HEALTH ORGANIZATION and DR. LEONCE VERSTUYFT, petitioners,


vs.
HON. BENJAMIN H. AQUINO, as Presiding Judge of Branch VIII, Court of First
Instance of Rizal, MAJOR WILFREDO CRUZ, MAJOR ANTONIO G. RELLEVE, and
CAPTAIN PEDRO S. NAVARRO of the Constabulary Offshore Action Center
(COSAC), respondents.

Facts

This case arose upon respondent judges refusal to quash a search warrant for the search
and seizure of personal effects of petitioner official, Dr. LeonceVerstufyt, of the World Health
Organization (WHO) notwithstanding his being entitled to diplomatic immunity as duly
recognized by the Executive Department of the Philippine Government. The basis of the
immunity is the Host Agreement executed by the Philippine Government and the WHO.
The grounds for issuance of search warrant instituted by COSAC was that they "contain
large quantities of highly dutiable goods" beyond the official needs of said petitioner "and the
only lawful way to reach these articles and effects for purposes of taxation is through a search
warrant."

Issue

Whether or not respondent judge committed grave abuse of discretion in issuing the
search warrant on the ground that petitioner official is entitled to diplomatic immunity?

Held

Yes, respondent judge committed grave abuse of discretion.


The executive branch of the Philippine Government has expressly recognized that
petitioner is entitled to diplomatic immunity, pursuant to the provisions of the Host Agreement. It
is a recognized principle of international law and under Philippine system of separation of
powers that diplomatic immunity is essentially a political question and courts should refuse to
look beyond a determination by the executive branch of the government, and where the plea of
diplomatic immunity is recognized and affirmed by the executive branch of the government as in
the case at bar, it is then the duty of the courts to accept the claim of immunity.

US V IRAN
On 4 November 1979 there was an armed attack by Iranian students on the United States
Embassy in Tehran and they overtook it. The students, belonging to the Muslim Student
Followers of the Imam's Line, did this as an act of support to the Iranian Revolution. More than
sixty American diplomats and citizens were held hostage for 444 days (until January 20, 1981).
Some of the hostages were released earlier, but 52 hostages were held hostage until the end.
Although Iran had promised protection to the U.S. Embassy, the guards disappeared during the
takeover and the government of Iran did not attempt to stop it or rescue the hostages. The U.S.
arranged to meet with Iranian authorities to discuss the release of the hostages, but Ayatollah
Khomeini (the leader of the Iranian Revolution) forbid officials to meet them. The U.S. ceased
relations with Iran, stopped U.S. exports, oil imports, and Iranian assets were blocked.

Judgments[edit]
The first decision was an Order of Provisional Measures, issued December 15, 1979. This was
the court issuing an opinion not on the merits underlying the case specifically, but rather ordering
a preservation of the respective rights and obligations the two countries owed one another
pending the final decision of the court. More specifically, the Court unanimously declared Iran
should ensure the restoration of the U.S. embassy in Tehran to U.S. possession, release the
hostages, and afford diplomatic officials full protections as afforded by international law.

The second decision addressed the actual merits of Iran's actions. Iran took no part in the
proceedings.

The case was the first real instance of the Court and the Security Council acting together to bring
a crisis to an end.

The ICJ considered the case in hand in two phases. The first phase referred to the armed attack
on the US Embassy in Tehran by militants and students of Iran. The question asked was whether
the militants and the students were 'agents' of the Iranian Government and therefore, acting on
their behalf. The second phase comprises the whole series of facts which occurred following the
completion of the occupation of the US Embassy by militants and the seizure of the Consulates.

The Court reached a judgement on 24 May 1980.[1]

CASE CONCERNING BARCELONA TRACTION, LIGHT, AND POWER CO, LTD


(Belgium v. Spain)
FACTS
Barcelona Traction, Light, and Power Company, Ltd was a corporation incorporated in
Canada, with Toronto headquarters, that made and supplied electricity in Spain. It had issued
bonds to non-Spanish investors, but during the Spanish Civil War (1936-1939) the Spanish
government refused to allow BTLP to transfer currency to pay bondholders the interest they were
due.
In 1948 a group of bondholders sued in Spain to declare that BTLP had defaulted on the
ground it had failed to pay the interest. The Spanish court allowed their claim. The business was
sold, the surplus distributed to the bondholders, and a small amount was paid to shareholders.
The shareholders in Canada succeeded in persuading Canada and other states to complain that
Spain had denied justice and violated a series of treaty obligations. However, Canada eventually
accepted that Spain had the right to prevent BTLP from transferring currency and declaring
BTLP bankrupt.
Of the shares, 88 per cent were owned by Belgians, and the Belgian government
complained, insisting the Spanish government had not acted properly. They made an initial claim
at the International Court of Justice in 1958, but later withdrew it to allow negotiations.
Subsequent negotiations broke down, and a new claim was filed in 1962. Spain contended that
Belgium had no standing because BTLP was a Canadian company.
ISSUE
Whether or not Belgium has a locus standi to sue Spain in behalf of their citizens.
HELD
The International Court of Justice held that Belgium had no legal interest in the matter to
justify it bringing a claim. Although Belgian shareholders suffered if a wrong was done to the
company, it was only the company's rights that could have been infringed by Spain's actions.It
was a general rule of international law that when an unlawful act was committed against a
company, only the state of incorporation of the company could sue. The BLTP which was
incorporated in Canada has a separate and distinct personality from its shareholders who holds
different nationalities. It is only Canada that can sue Spain but since they chose not to, it was
already the end.

CAIRE CLAIM, FRANCE V. MEXICO, FRENCH-MEXICAN CLAIMS

FACTS
December 11, 1914, Jean-Baptiste Caire, a French National, was killed by two Mexican army
officers within the premises of the army barracks due to the refusal of the former to pay a sum of
money in favor of the latter.

ISSUE

Whether or not Mexico should be held liable for the acts committed by its military personnel
acting without color of authority?

HELD

YES. It was held that Mexico was internationally responsible for the acts committed by its
officers. The court used the doctrine of objective responsibility wherein the state should be held
liable for acts committed by its officials or state organs notwithstanding the absence of fault on
the part of the state.

By committing the said act, the Mexican army officers made their state accountable for such act,
regardless they acted in their official capacity as officers of the state or not when they tried to
extort money and killed Caire,

NORTH AMERICAN DREDGING COMPANY OF TEXTS (U.S.A.) V. UNITED


MEXICAN STATES

31 March 1926
JURISDICTION CALVO CLAUSE. A Calvo clause held to bar claimant from presenting to
his Government any claim connected with the contract in which it appeared and hence to place
any such claim beyond the jurisdiction of the tribunal. The clause will not preclude his
Government from espousing, or the tribunal from considering, other claims based on the
violation of international law. Article V of the compromise held not to prevent the foregoing
result.

CONTRACT CLAIMS. Motion to dismiss, for lack of jurisdiction, claim based on non-
performance of a contract with Mexican Government rejected.

FACTS

The Government of Mexico entered a contract of dredging with The North American Dredging
Company (NADC) on November 12, 1912 in Mexico City. NADC was supposed to render
services in Mexico, and the payment was to be rendered therein. Thereafter, the United States of
America, in behalf of the North American Dredging Company of Texas, filed for the recovery of
the sum of $233,523.30 with interest and damages for an alleged breach in the contract of
dredging at the port of Salina Cruz. The case was filed with the General Claims Commission.

Mexico, represented by its agent, filed a motion to dismiss on the ground of a particular clause in
the contract, known as the Calvo Clause, wherein it states that the signing party agrees to reduce
or waive its rights as an alien or a foreign body or person and is subject to the local rights and
privileges provided by the host country, Mexico.

ISSUES

Whether or not the Calvo Clause deprives the party subscribing said clause of the right to submit
any clams connected with his contract to an international commission? And if so, does the
Commission have jurisdiction over the case?

RULING

Yes, while it is true that a state cannot subvert international law by providing incongruent laws,
the Calvo clause serves as an exception. The questioned clause serves as a precondition to
awarding a contract to foreign corporations, such as the petitioner, which the state protects itself
and its interest by holding that as a condition to allow the corporation to proceed with its venture,
the corporation agrees to have and avail of the same rights and privileges that the state equally
provides to its residents, and in case of any controversy, the corporation agrees to avail the
remedies available to the local tribunals and courts in the state without the corporations home
countrys intervention. The purpose of such a contract is to draw a reasonable and practical line
between Mexico's sovereign right of jurisdiction within its own territory, on the one hand, and
the sovereign right of protection of the Government of an alien whose person or property is
within such territory, on the other hand. Unless such line is drawn and if these two coexisting
rights are permitted constantly to overlap, continual friction is inevitable. The Calvo clause is a
valid exercise of a states sovereignty where it serves as a demarcation between the sovereignty
of a state and international law.

While it is true that the country of the injured individual, or in this case a corporation, may bring
the matter to an international tribunal to redress a lawful wrong, the state cannot strike down a
lawful contract entered into by its corporation as a matter of protection, as the corporation agreed
to be bound by the law of the contracting state. It being impossible to prove the illegality of the
said provision, by adducing generally recognized rules of positive international law; it apparently
can only be contested by invoking its incongruity to the law of nature and its inconsistency with
inalienable, indestructible, imprescriptible, uncurtailable rights of nations. However, it should be
stressed that the Calvo Clause is not absolute and should be tried on attending circumstances, and
will be tried and decided on the merits.

The Commission may take jurisdiction on the case, notwithstanding the existence of such a
clause in a contract subscribed by such claimant. But where a claimant has expressly agreed in
writing, attested by his signature, that in all matters pertaining to the execution, fulfillment, and
interpretation of the contract he will have resort to local tribunals, remedies, and authorities and
then willfully ignores them by applying in such matters to his Government, said claimant will be
held bound by his contract and the Commission will not take jurisdiction of such claim.

THE WORLD HEALTH ORGANIZATION and DR. LEONCE VERSTUYFT, petitioners,


vs.
HON. BENJAMIN H. AQUINO, as Presiding Judge of Branch VIII, Court of First
Instance of Rizal, MAJOR WILFREDO CRUZ, MAJOR ANTONIO G. RELLEVE, and
CAPTAIN PEDRO S. NAVARRO of the Constabulary Offshore Action Center
(COSAC), respondents.

Facts

This case arose upon respondent judges refusal to quash a search warrant for the search
and seizure of personal effects of petitioner official, Dr. LeonceVerstufyt, of the World Health
Organization (WHO) notwithstanding his being entitled to diplomatic immunity as duly
recognized by the Executive Department of the Philippine Government. The basis of the
immunity is the Host Agreement executed by the Philippine Government and the WHO.
The grounds for issuance of search warrant instituted by COSAC was that they "contain
large quantities of highly dutiable goods" beyond the official needs of said petitioner "and the
only lawful way to reach these articles and effects for purposes of taxation is through a search
warrant."

Issue

Whether or not respondent judge committed grave abuse of discretion in issuing the
search warrant on the ground that petitioner official is entitled to diplomatic immunity?

Held

Yes, respondent judge committed grave abuse of discretion.


The executive branch of the Philippine Government has expressly recognized that
petitioner is entitled to diplomatic immunity, pursuant to the provisions of the Host Agreement. It
is a recognized principle of international law and under Philippine system of separation of
powers that diplomatic immunity is essentially a political question and courts should refuse to
look beyond a determination by the executive branch of the government, and where the plea of
diplomatic immunity is recognized and affirmed by the executive branch of the government as in
the case at bar, it is then the duty of the courts to accept the claim of immunity.

US V IRAN
On 4 November 1979 there was an armed attack by Iranian students on the United States
Embassy in Tehran and they overtook it. The students, belonging to the Muslim Student
Followers of the Imam's Line, did this as an act of support to the Iranian Revolution. More than
sixty American diplomats and citizens were held hostage for 444 days (until January 20, 1981).
Some of the hostages were released earlier, but 52 hostages were held hostage until the end.
Although Iran had promised protection to the U.S. Embassy, the guards disappeared during the
takeover and the government of Iran did not attempt to stop it or rescue the hostages. The U.S.
arranged to meet with Iranian authorities to discuss the release of the hostages, but Ayatollah
Khomeini (the leader of the Iranian Revolution) forbid officials to meet them. The U.S. ceased
relations with Iran, stopped U.S. exports, oil imports, and Iranian assets were blocked.

Judgments[edit]
The first decision was an Order of Provisional Measures, issued December 15, 1979. This was
the court issuing an opinion not on the merits underlying the case specifically, but rather ordering
a preservation of the respective rights and obligations the two countries owed one another
pending the final decision of the court. More specifically, the Court unanimously declared Iran
should ensure the restoration of the U.S. embassy in Tehran to U.S. possession, release the
hostages, and afford diplomatic officials full protections as afforded by international law.

The second decision addressed the actual merits of Iran's actions. Iran took no part in the
proceedings.

The case was the first real instance of the Court and the Security Council acting together to bring
a crisis to an end.

The ICJ considered the case in hand in two phases. The first phase referred to the armed attack
on the US Embassy in Tehran by militants and students of Iran. The question asked was whether
the militants and the students were 'agents' of the Iranian Government and therefore, acting on
their behalf. The second phase comprises the whole series of facts which occurred following the
completion of the occupation of the US Embassy by militants and the seizure of the Consulates.

The Court reached a judgement on 24 May 1980.[1]

CASE CONCERNING BARCELONA TRACTION, LIGHT, AND POWER CO, LTD


(Belgium v. Spain)
FACTS
Barcelona Traction, Light, and Power Company, Ltd was a corporation incorporated in
Canada, with Toronto headquarters, that made and supplied electricity in Spain. It had issued
bonds to non-Spanish investors, but during the Spanish Civil War (1936-1939) the Spanish
government refused to allow BTLP to transfer currency to pay bondholders the interest they were
due.
In 1948 a group of bondholders sued in Spain to declare that BTLP had defaulted on the
ground it had failed to pay the interest. The Spanish court allowed their claim. The business was
sold, the surplus distributed to the bondholders, and a small amount was paid to shareholders.
The shareholders in Canada succeeded in persuading Canada and other states to complain that
Spain had denied justice and violated a series of treaty obligations. However, Canada eventually
accepted that Spain had the right to prevent BTLP from transferring currency and declaring
BTLP bankrupt.
Of the shares, 88 per cent were owned by Belgians, and the Belgian government
complained, insisting the Spanish government had not acted properly. They made an initial claim
at the International Court of Justice in 1958, but later withdrew it to allow negotiations.
Subsequent negotiations broke down, and a new claim was filed in 1962. Spain contended that
Belgium had no standing because BTLP was a Canadian company.
ISSUE
Whether or not Belgium has a locus standi to sue Spain in behalf of their citizens.
HELD
The International Court of Justice held that Belgium had no legal interest in the matter to
justify it bringing a claim. Although Belgian shareholders suffered if a wrong was done to the
company, it was only the company's rights that could have been infringed by Spain's actions.It
was a general rule of international law that when an unlawful act was committed against a
company, only the state of incorporation of the company could sue. The BLTP which was
incorporated in Canada has a separate and distinct personality from its shareholders who holds
different nationalities. It is only Canada that can sue Spain but since they chose not to, it was
already the end.

CAIRE CLAIM, FRANCE V. MEXICO, FRENCH-MEXICAN CLAIMS

FACTS
December 11, 1914, Jean-Baptiste Caire, a French National, was killed by two Mexican army
officers within the premises of the army barracks due to the refusal of the former to pay a sum of
money in favor of the latter.

ISSUE

Whether or not Mexico should be held liable for the acts committed by its military personnel
acting without color of authority?

HELD

YES. It was held that Mexico was internationally responsible for the acts committed by its
officers. The court used the doctrine of objective responsibility wherein the state should be held
liable for acts committed by its officials or state organs notwithstanding the absence of fault on
the part of the state.

By committing the said act, the Mexican army officers made their state accountable for such act,
regardless they acted in their official capacity as officers of the state or not when they tried to
extort money and killed Caire,

NORTH AMERICAN DREDGING COMPANY OF TEXTS (U.S.A.) V. UNITED


MEXICAN STATES

31 March 1926
JURISDICTION CALVO CLAUSE. A Calvo clause held to bar claimant from presenting to
his Government any claim connected with the contract in which it appeared and hence to place
any such claim beyond the jurisdiction of the tribunal. The clause will not preclude his
Government from espousing, or the tribunal from considering, other claims based on the
violation of international law. Article V of the compromise held not to prevent the foregoing
result.

CONTRACT CLAIMS. Motion to dismiss, for lack of jurisdiction, claim based on non-
performance of a contract with Mexican Government rejected.

FACTS

The Government of Mexico entered a contract of dredging with The North American Dredging
Company (NADC) on November 12, 1912 in Mexico City. NADC was supposed to render
services in Mexico, and the payment was to be rendered therein. Thereafter, the United States of
America, in behalf of the North American Dredging Company of Texas, filed for the recovery of
the sum of $233,523.30 with interest and damages for an alleged breach in the contract of
dredging at the port of Salina Cruz. The case was filed with the General Claims Commission.

Mexico, represented by its agent, filed a motion to dismiss on the ground of a particular clause in
the contract, known as the Calvo Clause, wherein it states that the signing party agrees to reduce
or waive its rights as an alien or a foreign body or person and is subject to the local rights and
privileges provided by the host country, Mexico.

ISSUES

Whether or not the Calvo Clause deprives the party subscribing said clause of the right to submit
any clams connected with his contract to an international commission? And if so, does the
Commission have jurisdiction over the case?

RULING

Yes, while it is true that a state cannot subvert international law by providing incongruent laws,
the Calvo clause serves as an exception. The questioned clause serves as a precondition to
awarding a contract to foreign corporations, such as the petitioner, which the state protects itself
and its interest by holding that as a condition to allow the corporation to proceed with its venture,
the corporation agrees to have and avail of the same rights and privileges that the state equally
provides to its residents, and in case of any controversy, the corporation agrees to avail the
remedies available to the local tribunals and courts in the state without the corporations home
countrys intervention. The purpose of such a contract is to draw a reasonable and practical line
between Mexico's sovereign right of jurisdiction within its own territory, on the one hand, and
the sovereign right of protection of the Government of an alien whose person or property is
within such territory, on the other hand. Unless such line is drawn and if these two coexisting
rights are permitted constantly to overlap, continual friction is inevitable. The Calvo clause is a
valid exercise of a states sovereignty where it serves as a demarcation between the sovereignty
of a state and international law.

While it is true that the country of the injured individual, or in this case a corporation, may bring
the matter to an international tribunal to redress a lawful wrong, the state cannot strike down a
lawful contract entered into by its corporation as a matter of protection, as the corporation agreed
to be bound by the law of the contracting state. It being impossible to prove the illegality of the
said provision, by adducing generally recognized rules of positive international law; it apparently
can only be contested by invoking its incongruity to the law of nature and its inconsistency with
inalienable, indestructible, imprescriptible, uncurtailable rights of nations. However, it should be
stressed that the Calvo Clause is not absolute and should be tried on attending circumstances, and
will be tried and decided on the merits.

The Commission may take jurisdiction on the case, notwithstanding the existence of such a
clause in a contract subscribed by such claimant. But where a claimant has expressly agreed in
writing, attested by his signature, that in all matters pertaining to the execution, fulfillment, and
interpretation of the contract he will have resort to local tribunals, remedies, and authorities and
then willfully ignores them by applying in such matters to his Government, said claimant will be
held bound by his contract and the Commission will not take jurisdiction of such claim.

THE WORLD HEALTH ORGANIZATION and DR. LEONCE VERSTUYFT, petitioners,


vs.
HON. BENJAMIN H. AQUINO, as Presiding Judge of Branch VIII, Court of First
Instance of Rizal, MAJOR WILFREDO CRUZ, MAJOR ANTONIO G. RELLEVE, and
CAPTAIN PEDRO S. NAVARRO of the Constabulary Offshore Action Center
(COSAC), respondents.

Facts

This case arose upon respondent judges refusal to quash a search warrant for the search
and seizure of personal effects of petitioner official, Dr. LeonceVerstufyt, of the World Health
Organization (WHO) notwithstanding his being entitled to diplomatic immunity as duly
recognized by the Executive Department of the Philippine Government. The basis of the
immunity is the Host Agreement executed by the Philippine Government and the WHO.
The grounds for issuance of search warrant instituted by COSAC was that they "contain
large quantities of highly dutiable goods" beyond the official needs of said petitioner "and the
only lawful way to reach these articles and effects for purposes of taxation is through a search
warrant."

Issue

Whether or not respondent judge committed grave abuse of discretion in issuing the
search warrant on the ground that petitioner official is entitled to diplomatic immunity?

Held

Yes, respondent judge committed grave abuse of discretion.


The executive branch of the Philippine Government has expressly recognized that
petitioner is entitled to diplomatic immunity, pursuant to the provisions of the Host Agreement. It
is a recognized principle of international law and under Philippine system of separation of
powers that diplomatic immunity is essentially a political question and courts should refuse to
look beyond a determination by the executive branch of the government, and where the plea of
diplomatic immunity is recognized and affirmed by the executive branch of the government as in
the case at bar, it is then the duty of the courts to accept the claim of immunity.

US V IRAN
On 4 November 1979 there was an armed attack by Iranian students on the United States
Embassy in Tehran and they overtook it. The students, belonging to the Muslim Student
Followers of the Imam's Line, did this as an act of support to the Iranian Revolution. More than
sixty American diplomats and citizens were held hostage for 444 days (until January 20, 1981).
Some of the hostages were released earlier, but 52 hostages were held hostage until the end.
Although Iran had promised protection to the U.S. Embassy, the guards disappeared during the
takeover and the government of Iran did not attempt to stop it or rescue the hostages. The U.S.
arranged to meet with Iranian authorities to discuss the release of the hostages, but Ayatollah
Khomeini (the leader of the Iranian Revolution) forbid officials to meet them. The U.S. ceased
relations with Iran, stopped U.S. exports, oil imports, and Iranian assets were blocked.

Judgments[edit]
The first decision was an Order of Provisional Measures, issued December 15, 1979. This was
the court issuing an opinion not on the merits underlying the case specifically, but rather ordering
a preservation of the respective rights and obligations the two countries owed one another
pending the final decision of the court. More specifically, the Court unanimously declared Iran
should ensure the restoration of the U.S. embassy in Tehran to U.S. possession, release the
hostages, and afford diplomatic officials full protections as afforded by international law.

The second decision addressed the actual merits of Iran's actions. Iran took no part in the
proceedings.

The case was the first real instance of the Court and the Security Council acting together to bring
a crisis to an end.

The ICJ considered the case in hand in two phases. The first phase referred to the armed attack
on the US Embassy in Tehran by militants and students of Iran. The question asked was whether
the militants and the students were 'agents' of the Iranian Government and therefore, acting on
their behalf. The second phase comprises the whole series of facts which occurred following the
completion of the occupation of the US Embassy by militants and the seizure of the Consulates.

The Court reached a judgement on 24 May 1980.[1]

CASE CONCERNING BARCELONA TRACTION, LIGHT, AND POWER CO, LTD


(Belgium v. Spain)
FACTS
Barcelona Traction, Light, and Power Company, Ltd was a corporation incorporated in
Canada, with Toronto headquarters, that made and supplied electricity in Spain. It had issued
bonds to non-Spanish investors, but during the Spanish Civil War (1936-1939) the Spanish
government refused to allow BTLP to transfer currency to pay bondholders the interest they were
due.
In 1948 a group of bondholders sued in Spain to declare that BTLP had defaulted on the
ground it had failed to pay the interest. The Spanish court allowed their claim. The business was
sold, the surplus distributed to the bondholders, and a small amount was paid to shareholders.
The shareholders in Canada succeeded in persuading Canada and other states to complain that
Spain had denied justice and violated a series of treaty obligations. However, Canada eventually
accepted that Spain had the right to prevent BTLP from transferring currency and declaring
BTLP bankrupt.
Of the shares, 88 per cent were owned by Belgians, and the Belgian government
complained, insisting the Spanish government had not acted properly. They made an initial claim
at the International Court of Justice in 1958, but later withdrew it to allow negotiations.
Subsequent negotiations broke down, and a new claim was filed in 1962. Spain contended that
Belgium had no standing because BTLP was a Canadian company.
ISSUE
Whether or not Belgium has a locus standi to sue Spain in behalf of their citizens.
HELD
The International Court of Justice held that Belgium had no legal interest in the matter to
justify it bringing a claim. Although Belgian shareholders suffered if a wrong was done to the
company, it was only the company's rights that could have been infringed by Spain's actions.It
was a general rule of international law that when an unlawful act was committed against a
company, only the state of incorporation of the company could sue. The BLTP which was
incorporated in Canada has a separate and distinct personality from its shareholders who holds
different nationalities. It is only Canada that can sue Spain but since they chose not to, it was
already the end.

CAIRE CLAIM, FRANCE V. MEXICO, FRENCH-MEXICAN CLAIMS

FACTS
December 11, 1914, Jean-Baptiste Caire, a French National, was killed by two Mexican army
officers within the premises of the army barracks due to the refusal of the former to pay a sum of
money in favor of the latter.

ISSUE

Whether or not Mexico should be held liable for the acts committed by its military personnel
acting without color of authority?

HELD

YES. It was held that Mexico was internationally responsible for the acts committed by its
officers. The court used the doctrine of objective responsibility wherein the state should be held
liable for acts committed by its officials or state organs notwithstanding the absence of fault on
the part of the state.

By committing the said act, the Mexican army officers made their state accountable for such act,
regardless they acted in their official capacity as officers of the state or not when they tried to
extort money and killed Caire,

NORTH AMERICAN DREDGING COMPANY OF TEXTS (U.S.A.) V. UNITED


MEXICAN STATES

31 March 1926
JURISDICTION CALVO CLAUSE. A Calvo clause held to bar claimant from presenting to
his Government any claim connected with the contract in which it appeared and hence to place
any such claim beyond the jurisdiction of the tribunal. The clause will not preclude his
Government from espousing, or the tribunal from considering, other claims based on the
violation of international law. Article V of the compromise held not to prevent the foregoing
result.

CONTRACT CLAIMS. Motion to dismiss, for lack of jurisdiction, claim based on non-
performance of a contract with Mexican Government rejected.

FACTS

The Government of Mexico entered a contract of dredging with The North American Dredging
Company (NADC) on November 12, 1912 in Mexico City. NADC was supposed to render
services in Mexico, and the payment was to be rendered therein. Thereafter, the United States of
America, in behalf of the North American Dredging Company of Texas, filed for the recovery of
the sum of $233,523.30 with interest and damages for an alleged breach in the contract of
dredging at the port of Salina Cruz. The case was filed with the General Claims Commission.

Mexico, represented by its agent, filed a motion to dismiss on the ground of a particular clause in
the contract, known as the Calvo Clause, wherein it states that the signing party agrees to reduce
or waive its rights as an alien or a foreign body or person and is subject to the local rights and
privileges provided by the host country, Mexico.

ISSUES

Whether or not the Calvo Clause deprives the party subscribing said clause of the right to submit
any clams connected with his contract to an international commission? And if so, does the
Commission have jurisdiction over the case?

RULING

Yes, while it is true that a state cannot subvert international law by providing incongruent laws,
the Calvo clause serves as an exception. The questioned clause serves as a precondition to
awarding a contract to foreign corporations, such as the petitioner, which the state protects itself
and its interest by holding that as a condition to allow the corporation to proceed with its venture,
the corporation agrees to have and avail of the same rights and privileges that the state equally
provides to its residents, and in case of any controversy, the corporation agrees to avail the
remedies available to the local tribunals and courts in the state without the corporations home
countrys intervention. The purpose of such a contract is to draw a reasonable and practical line
between Mexico's sovereign right of jurisdiction within its own territory, on the one hand, and
the sovereign right of protection of the Government of an alien whose person or property is
within such territory, on the other hand. Unless such line is drawn and if these two coexisting
rights are permitted constantly to overlap, continual friction is inevitable. The Calvo clause is a
valid exercise of a states sovereignty where it serves as a demarcation between the sovereignty
of a state and international law.

While it is true that the country of the injured individual, or in this case a corporation, may bring
the matter to an international tribunal to redress a lawful wrong, the state cannot strike down a
lawful contract entered into by its corporation as a matter of protection, as the corporation agreed
to be bound by the law of the contracting state. It being impossible to prove the illegality of the
said provision, by adducing generally recognized rules of positive international law; it apparently
can only be contested by invoking its incongruity to the law of nature and its inconsistency with
inalienable, indestructible, imprescriptible, uncurtailable rights of nations. However, it should be
stressed that the Calvo Clause is not absolute and should be tried on attending circumstances, and
will be tried and decided on the merits.

The Commission may take jurisdiction on the case, notwithstanding the existence of such a
clause in a contract subscribed by such claimant. But where a claimant has expressly agreed in
writing, attested by his signature, that in all matters pertaining to the execution, fulfillment, and
interpretation of the contract he will have resort to local tribunals, remedies, and authorities and
then willfully ignores them by applying in such matters to his Government, said claimant will be
held bound by his contract and the Commission will not take jurisdiction of such claim.

THE WORLD HEALTH ORGANIZATION and DR. LEONCE VERSTUYFT, petitioners,


vs.
HON. BENJAMIN H. AQUINO, as Presiding Judge of Branch VIII, Court of First
Instance of Rizal, MAJOR WILFREDO CRUZ, MAJOR ANTONIO G. RELLEVE, and
CAPTAIN PEDRO S. NAVARRO of the Constabulary Offshore Action Center
(COSAC), respondents.

Facts

This case arose upon respondent judges refusal to quash a search warrant for the search
and seizure of personal effects of petitioner official, Dr. LeonceVerstufyt, of the World Health
Organization (WHO) notwithstanding his being entitled to diplomatic immunity as duly
recognized by the Executive Department of the Philippine Government. The basis of the
immunity is the Host Agreement executed by the Philippine Government and the WHO.
The grounds for issuance of search warrant instituted by COSAC was that they "contain
large quantities of highly dutiable goods" beyond the official needs of said petitioner "and the
only lawful way to reach these articles and effects for purposes of taxation is through a search
warrant."

Issue

Whether or not respondent judge committed grave abuse of discretion in issuing the
search warrant on the ground that petitioner official is entitled to diplomatic immunity?

Held

Yes, respondent judge committed grave abuse of discretion.


The executive branch of the Philippine Government has expressly recognized that
petitioner is entitled to diplomatic immunity, pursuant to the provisions of the Host Agreement. It
is a recognized principle of international law and under Philippine system of separation of
powers that diplomatic immunity is essentially a political question and courts should refuse to
look beyond a determination by the executive branch of the government, and where the plea of
diplomatic immunity is recognized and affirmed by the executive branch of the government as in
the case at bar, it is then the duty of the courts to accept the claim of immunity.

US V IRAN
On 4 November 1979 there was an armed attack by Iranian students on the United States
Embassy in Tehran and they overtook it. The students, belonging to the Muslim Student
Followers of the Imam's Line, did this as an act of support to the Iranian Revolution. More than
sixty American diplomats and citizens were held hostage for 444 days (until January 20, 1981).
Some of the hostages were released earlier, but 52 hostages were held hostage until the end.
Although Iran had promised protection to the U.S. Embassy, the guards disappeared during the
takeover and the government of Iran did not attempt to stop it or rescue the hostages. The U.S.
arranged to meet with Iranian authorities to discuss the release of the hostages, but Ayatollah
Khomeini (the leader of the Iranian Revolution) forbid officials to meet them. The U.S. ceased
relations with Iran, stopped U.S. exports, oil imports, and Iranian assets were blocked.

Judgments[edit]
The first decision was an Order of Provisional Measures, issued December 15, 1979. This was
the court issuing an opinion not on the merits underlying the case specifically, but rather ordering
a preservation of the respective rights and obligations the two countries owed one another
pending the final decision of the court. More specifically, the Court unanimously declared Iran
should ensure the restoration of the U.S. embassy in Tehran to U.S. possession, release the
hostages, and afford diplomatic officials full protections as afforded by international law.

The second decision addressed the actual merits of Iran's actions. Iran took no part in the
proceedings.

The case was the first real instance of the Court and the Security Council acting together to bring
a crisis to an end.

The ICJ considered the case in hand in two phases. The first phase referred to the armed attack
on the US Embassy in Tehran by militants and students of Iran. The question asked was whether
the militants and the students were 'agents' of the Iranian Government and therefore, acting on
their behalf. The second phase comprises the whole series of facts which occurred following the
completion of the occupation of the US Embassy by militants and the seizure of the Consulates.

The Court reached a judgement on 24 May 1980.[1]