Summaries of Judgments, AdNot an official documentrs of the Internationa
l Court of Justice
CASE CONCERNING THEBARCELONA TRACTION,LIGHTAND
POWEIR COMPANYL , IMITED(PRELIMINARY OBJECTIONS)
Judgment of 24July 1964
Roceedings in the caseconcerning theBarcelonanac- had been anunderstandingbetweenthe Parties;it recalled
tion,LightandPower CompanyL , imited (Belgiumv.Spain) thattherepresentativesof theprivateBelgianinterestscon-
wereinstitutedby an Applicationof 19June 1962in which cernedhadmadeanapproachwitha view toopeningnegoti-
the Belgian Government sought reparation for damage ations and that the representativesof the Spanishinterests
claimedtohavebeencausedtoBelgian naticwals,sharehold- hadlaiddownasapriorconditionthefinalvvithdrawaolfthe
ersintheCanadianBarcelonaTraction Company,bythecon- claim.According totheRespondentwhat wasmeantbythis
duct of various organsof the SpanishState. TheSpanish wasthatthediscontinuancewouldput anend to anyfurther
GovernmentraisedfourPrelliminaryObjections. rightof action,buttheApplicantdeniedthat anythingmore
The Court rejectedthe firstPreliminaryObjectionby 12 was intended than the termination of the then current
votesto4, andthesecondby 10votesto6. ltjoinedthe third proceedings.TheCourtwasunabletofindatthegovernmen-
Objectionto themeritsby9 votesto 7 andthe fourthby 10 tal level any evidenceof any such understandingas was
votesto6. allegedby the Respondent; it seemethat theproblemhad
Resident Sir Percy Speanderand Judges Spiropoulos, been dleliberatelyavoidedlest the foundationof the inter-
Koretsky and Jessup appendedDeclarationsto the Judg- changesbe shattered.Nor hadthe Respondent,on whom
ment. lay the onusd making its positionclear, expressedany
Vice-Resident Wellington Koo and JudgesTanakaand condition when it indicated thatit did not object to the
Bustamantey RiveroappendedSeparateOplinions. discontinuance.
Judge MorelliandJudge.adhocArmand-Ugon appended TheRespondentGovernmentthenadvancedafourthargu-
DissentingOpinions. ment,having thecharacterofaplea ofestoppel,totheeffect
that, independentlyof the existenceof any understanding,
the Applicanthad by its conduct misled the Respondent
about the importof the discontinuance,t for which the
Respondentwould nothave agreed toit, and would not
thereby have suffered prejudice.Ceourtdidnotconsider
FirstPreliminaryObjection that thealleged misleading Belgimisrepresentationshad
been establishedand could notsee what the Respondent ,
InitsJudgment, theCountrecalledthatBelgiumhadon23 stoodtolosebyagreeingtonegotiateonthebasisofa simple
September 1958filed with theCourt anearlier.Application discontinuance;ifithadnotpd tothediscontinuance,the
againstSpaininrespectofthlesamefacts,andSpainhadthen previousproceedingswouldsimplyhavecontinued,whereas
raisedthreeReliminary Objections. On23March1961the negotiationsoffereda possibilityof finallysettling the dis-
Applicant. availing itselfhe right conferredupon it by thecasestartedagain,itwouldstillepossibleoncemoretoland
theCourtthatitwasnot going on wittheproceedings; noti- putfo~wardthe previous PreliminarObjections. Certainly
ficationhavingbeenreceivemftrlomtheRespondentthatithad theApplicanthadframeditssecondApplication withafore-
no objection, the Courthaclremoved thecase fromitsList knowledgeof the probable natureofthe Respondent'sreply
(10 April 1961). In its first Reliminary Objection, the andtakingitintoaccount but,iftheoriginalproceedinhad
Respondentcontendedthatthisdiscontinuancep~wludedthe continued, theApplicant couldlikewisealways havemodi-
Applicant from bringing the presentf~roceedingsand fiedits submissions.
advanced five argumentisnriupportofitscontention.
The Court acceptedthe lint argument,tothe effect that Thefinal argumentwasof a differentorder.TheRespon-
discontinuanceisapurelyp~nceduralctthereal significance dentallegedthatthepresentproceedings erecontrarytothe
ofwhichmustbesoughtinrheattendantcir~cumstances. Settlementand Arbitrationof 19July 1927which, according
to the Applicant, conferredcompetence onthe Court. The
On theotherhand, theCcwt wasunabletoacceptthesec- preliminarystagesprovidedforbytheTreatyhaving already
ondargument,namelythat ;d~iscontinuancm:ustalwaysbe been gone throughin connection withthe original pro-
actionunlessthe rightto startnewproceedingsis expressly ceedings,theTkaty couldnotbe invokeda second timeto
reserved.As the Applicant's notiof discontinuancecon- seise the Courtof the samecomplaints. TheCourtconsid-
tained no motivationand vvasvery clearlyconfinedto the ered that the Tkaty processes could not be regardedas
proceedingsinstitutedby dhefirst Application, theCourt exhausted so longas the right to bring new proceedings
consideredthat the onusofsstablishingtheitthe discontinu-therwise existedand until thecasehadbeenprosecutedto
ance meantsomethingmore than a decision toterminate judgment.
thoseproceedingswasplaceduponthe Reslmnd~znt.
Forthese reasons,the Court rejectedthefirstPreliminary
TheRespondent, as itsth.irdargument,assertedthat thereObjection.
Continued on next page
67SecondPreliminaryObjection thePermanentCourtmustbe takentohaveknownthatoneof
the resultsof theiiradmissionwouldbe the reactivationby
Tofound thejurisdictionoftheCourttheApplicant relied reasonof kicle 37 ofcertainjurisdictionaclauses.The
on thecombinedeffectof Article17(4)of the 1927Treaty position by the~~~~~d~~~would
between BelgiumandSpain,according towhichiftheother at,discriminationbetween states accordingasto whether
methodsofsettlementprovidedforinthatTreatyfailedeither theybecame tothestatut beforeor afterthedissolu-
party could bringanydisputeofalegalnaturebefore thePer- tionofthe court.
manentCourtof InternationalJustice,ant1Article37of the AsregardsArticle17(4)moreparticularly,theCourt con-
Statuteof theInternationalCourtof Justice,whichreadsas sidered that iWPS an integral part of the 192Treaty. It
follows: wouldbedifficult toassertthatthebasicobligatiotosubmit
"Wheneveratreatyorconventionin forceprovidesfor to compulsoty providedfor in the Treatywas
reference amatter .. tothePermm'nt CourtofInter- exclusivelydependentontheexistenceofaparticularforum.
nationalJustice,thema*r shall,asbetweentheparties If ithappenedthattheforumwentoutofexistence,theobli-
thepresent be referredto theIrlternational gation became inc)perativebut remained substantivelyin
ofJustice." existenceandcouldberenderedoperativeoncemoreifanew
As theprincipalaspectof its objection,the Respondent tribunalwas suppliedby the automatic operationof some
maintainedthat althoughthe 1927Treatymight still be in otherinstrument.Article37oftheStatutehadpreciselythat
force,Article17(4)hadlapsedinApril19,46onthedissolu- effect. Accordingl:y,"InternationalCourt of Justice" must
substitutionof the present for the formerCourt had been nowbereadfor"PermanentCourtofInternationalJustice".
effectedinthatarticlebeforethedissolution,Spainnotbeing As a subsidiaryplea, the Respondentcontendedthat if
thena partytothe Statute;inconsequence*the 1927Treaty Article37ofthe statut operatedtoreactivateArticle17(4)
had ceased to containany validjurisdictional clausewhen oftheTreatyinDecember1955,whatcame intoexistenceat
Spainwasadmittedtothe United and became'pso thatdatewas anev, obligation the andthat
factoa partytothe Statute(December1955).Inotherwords* just as the originalapplied only todisputes arisingafterthe
~rticle 37 applied only betweenStateswlhichhad become Treatydate, sothe new obligationcould apply only todis-
partiestotheStatuteprevioustothedissolutionofthePerma- putesarisingafterDecember1955.Thedisputewasaccord-
nentCourt,andthatdissolutionhadbrought.abouttheextinc- inglynot sLincit had arisenpreviousto be^
tion of jurisdictional clausesprovidingfor recourseto the rnittocompulsoryadjudicationwaswhentheobl%gto itopera-
PermanentCourt they had previouslybeen trans- tion,itcouldonlyfunctioninaccordancewiththeTreatypro-
formedbytheoperationofArticle37intoclausesproviding vidingforitanditcontinuedtorelatetoanydisputesarising
forrecoursetothepresentCourt. aftertheTreatydate.
TheCourt foundthat this lineof reasoninghad firstbeen the blimi-
advancedbytheRespondentafter thedecisiongivenbythe Forobjection both in itst in its subsidiary
Court on 26May1959inthecaseconcerningtheAerialInci- aspects.
dentof 27 July 1955 (Israelv. Bulgaria).13utthatcasehad
beenconcernedwithaunilateraldeclarationinacceptanceof ThirdandFoufihPrelimiMryObjections
thecompulsoryjurisdictionof thePermanentCourt andnot
witha treaty.It thus had referencenot toticle37 but to TheRespondent's third andfourthPreliminaryObjections
Article36,paragraph5, oftheStatute. involvedthe questionof whether theclaimwasadmissible.
As regards Article37, the Courtecalledthatin 1945its The Applicanthad submitted alternativepleas thatthese
drafters had intended to preserveas many jurisdictional objections,unlessnsjectedbytheCourt,shouldbejoined to
clauses as possiblefrombecominginoperativebyreasonof themerits.
the prospectivedissolutionof the Permanent Court.It was Byits thud PreliminaryObjectiontheRespondentdenied
thusdifficult tosupposethatthey wouldwil.linglyhavecon- the legal capacityof the Applicant toprotect theBelgian
templatedthat the nullificationof theisdictionalclauses interestson behalfof whichit had submitted its claim.The
whose continuationit was desired to preserve would be actscomplainedof hadtaken place notinrelationtoanyBel-
broughtaboutbythevery event theeffectsofwhichArticle giannaturalorjuristicpersonbut inrelationtotheBarcelona
37 was intendedtoparry. ?factionCompany, ;juristic entityregisteredinCanada, the
Onlythreeconditionswereactuallystatedin Article37, Belgianinterestsol~cernedbeinginthenatureofsharehold-
Theywerethat there shouldbeatreatyinforce;that it should ing interestsin that:company.The Respondentcontended
containaprovisionforthereferenceofamatterto thePerma- thatinternationallawdoesnotrecognize,inrespectofinjury
nentCourt;andthatthedisputeshouldbebetweenStates par- causedby a State to the foreigncompany,any diplomatic
tiestotheStatute.Inthepresentcasethecorlclusionmustbe protectionofshareholdersexercisedbya Stateotherthanthe
thatthe1927Treatybeinginforceandcontainingaprovision national Stateof thecompany.TheApplicantcontestedthis
forreferenceto the PennanentCourt,andthe partiesto the view.
disputebeingpartiestotheStatute,thematterwasone tobe The Court foundthat the questionof thejus standiof a
referred10theInternationalCourtofJustice:,whichwasthe governmenttoprotecttheinterestsofshareholdersraisedan
competentforum. antecedentquestionof what was the juridical situationin
Itwasobjectedthatthisviewledtoasituationin whichthe respectof shareholdinginterests, asrecognizedbyinterna-
jurisdictional clause concernedwas inoperativeand then tional law. TheApplicantthus necessarily invokedrights
aftea gapofyearsbecameoperativeagain,anditwas asked which,soitcontended,wereconferredonit inrespectof its
whetherinthosecircumstancesanytrue consentcouldhave nationalsby the rules of internationallaw concerningthe
been given by the Respondent tothe Court's jurisdiction. treatmentof foreigners.Hencea findingbytheCourt thatit
The Courtobservedthatthenotionofrightsandobligations hadnojus standiwouldbetantamounttoafindingthat those
that are in abeyancebut not extinguishedwas common; rights didnotexistrtdthat theclaimwas notwell-foundedin
Statesbecomingpartiestothe Statuteafterthedissolutionof substance.
68 The thirdObjectionhad cxrtainaspects-whichwereof a The foregoing considerations applied a fortiori to the
preliminarycharacter, but involved a number of closely fourth Reliminary Objection, wherein the Respondent
interwovenstrandsof mixetllaw, factandstatusto adegree allegedfailuretoexhaustlocalremedies.Thisallegationwas
suchthattheCourtcouldnot:pronounceuponitatthepresent in fact inextricablyinterwovenwith the issuesof denialof
stageinfullconfidencethat ilwasinpossessionofalltheele- justicewhichconstituted themajor partof the meritsof the
mentsthat mighthave a bearingon its decisions. Thepro- case.
ceedingsonthemerits woul~tchlusplacetheColutinabetter Accordingly,theCourtjoinedthethirdandfourthRelim-
position toadjudicatewithafullknowledgeofthefacts. inaryObjectionstothemerits.
Summary of the Judgment of 24 July 1964