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[Translation]
[p65] The Court,
composed as above,
delivers the following judgment:
[1] By an Application filed with the Registry of the Court on January 26th,
1938, under Article 40 of the Statute of the Court, the Belgian Government
instituted proceedings before the Court against the Bulgarian Government.
[2] In submitting the case to the Court the Applicant relied upon:
(1) the declarations of Belgium and Bulgaria recognizing the jurisdiction of
the Court as compulsory, declarations which were respectively ratified on
March 10th, 1926, and August 12th, 1921;
(2) the Treaty of conciliation, arbitration and judicial settlement
concluded between the two countries on June 23rd, 1931.
[3] After a succinct statement of the facts and arguments adduced in support
of. the claim, the Application prayed the Court:
"(A) to declare that the State of Bulgaria has failed in its international
obligations:
(1) by reason of the fact that the State Administration of Mines, on
November 24th, 1934, put into force a special artificially calculated tariff
for coal supplied to power stations, in order to enable the Municipality of
Sofia to distort the application of the decisions given by the Mixed
Arbitral Tribunal in 1923 and 1925;
(2) by reason of the above-mentioned judgments of the District Court and of
the Court of Appeal of Sofia, which deprived the Electricity Company of
Sofia and Bulgaria of the benefit of the said decisions of the Mixed
Arbitral Tribunal
(a) by allowing the fictitious value fixed by the Administration of Mines to
be used for the calculation of the factor 'P' in the formula for determining
the tariff, [p66]
(b) by deciding that the factor V should be calculated on the basis of the
official rate of exchange decreed by the National Bank of Bulgaria and not
on the basis of the rate of exchange actually applied by that Bank for the
conversion of Bulgarian currency into foreign currency,
(c) by deciding that the Company could no longer require its consumers to
pay the amount of the excise duty,
(d) by deciding that the Company could not put any tariff into operation
before having obtained the formal agreement of the Municipality;
(3) by reason of the promulgation of the law of February 3rd, 1936, Article
30, paragraph C, of which establishes a special tax on the distribution of
electric power purchased from undertakings not subject to tax.
(B) and to order the requisite reparation in respect of the above-mentioned
acts to be made. "
[4] On January 26th, 1938, notice of the Application of the Belgian
Government was given to the Bulgarian Government, and on February 1st the
communications provided for in Article 40 of the Statute and Article 34 of
the Rules of Court were duly despatched.
[5] As the Court does not include upon the Bench a judge of Bulgarian
nationality, the Bulgarian Government availed itself of its right under
Article 31 of the Statute and nominated M. Theohar Papazoff.
[6] The two Governments appointed as their Agents: the Belgian Government,
M. J. G. de Ruelle, assisted by Maitre Rene Marcq and Maitre Henri Rolin,
and the Bulgarian Government, M. Ivan Altinoff, assisted by Maitre Gilbert
Gidel.
[7] By an Order made on March 28th, 1938, the President of the Court fixed
the time-limits for the filing of the Memorial by the Belgian Government and
of the Counter-Memorial by the Bulgarian Government.
[8] On July 2nd, 1938, the Belgian Government, in view of certain measures
of execution against the Electricity Company of Sofia and Bulgaria,
announced by the Municipality of Sofia in default of payment by that Company
of a certain sum claimed from it, requested the Court, under Article 41 of
the Statute and Article 61 of the Rules, to indicate, as an interim measure
of protection, that the compulsory collection by the Municipality of Sofia
of the said sum must be postponed pending the delivery of judgment on the
merits.
[9] The Court held a hearing on July 13th, 1938, for the examination of this
request, but a communication was received from the Agent for the Bulgarian
Government stating that he could not be present at the hearing as the notice
given was very short. The Court however heard a statement by the Agent for
[p67] the Belgian Government to the effect that his Government would make no
objection to the granting of the necessary time to the Bulgarian Government.
After deliberation, the Court decided the same day to adjourn the
proceedings in regard to the request for the indication of interim measures
of protection, in order to enable the Bulgarian Government to prepare its
observations upon that request and, if need be, in regard to the
jurisdiction of the Court; the Agents of the Parties would be heard by the
Court at a public sitting the date of which would be subsequently fixed by
the President.
[10] Following upon a telegram sent on July 27th, 1938, by the Agent for the
Bulgarian Government to the President of the Court, the text of which was
duly communicated to the Agent for the Belgian Government, the latter
informed the Court in a letter of August 26th, 1938, that in view of the
statements contained in this telegram, the Belgian Government withdrew the
request for the indication of an interim measure of protection presented on
July 2nd, 1938.
[11] On August 27th, 1938, the President of the Court made an Order
recording the withdrawal by the Belgian Government of its request for the
indication of an interim measure of protection and stating that in these
circumstances there was no occasion to fix the public hearing contemplated
by the Court's decision of July 13th, 1938.
[12] By another Order of the same date, the President extended until October
31st, 1938, the time-limit for the filing of the Bulgarian Counter-Memorial
which had originally been fixed to expire on September 12th, 1938. This
time-limit, which was subsequently further extended, finally expired on
November 30th, 1938.
[13] In its Memorial, the Belgian Government prayed the Court:
"A. - To declare that the State of Bulgaria has failed in its international
obligations:
(1) By reason of the fact that the State Administration of Mines, on
November 24th, 1934, put into force a special artificially calculated tariff
for coal supplied to power stations, in order to enable the Municipality of
Sofia to distort the application of the decisions given by the Mixed
Arbitral Tribunal in 1923 and 1925;
(2) By reason of the above-mentioned judgments of the District Court and of
the Court of Appeal of Sofia and of the judgment of the Court of Cassation
of March 16th, 1938, which deprived the Electricity Company of Sofia and
Bulgaria of the benefit of the said decisions of the Mixed Arbitral
Tribunal;
(a) By allowing the fictitious value fixed by the Administration of Mines to
be used for the calculation of the factor 'P' in the formula for determining
the tariff; [p68]
(b) By deciding that the factor V should be calculated on the basis of the
official rate of exchange decreed by the National Bank of Bulgaria and not
on the basis of the rate of exchange actually applied by that Bank for the
conversion of Bulgarian currency into foreign currency;
(c) By deciding that the Company could no longer require its consumers to
pay the amount of the excise duty;
(d) By deciding that the Company could not put any tariff into operation
before having obtained the formal agreement of the Municipality;
(3) By reason of the promulgation of the law of February 3rd, 1936, as
supplemented by Circular No. 3800 of February 28th, 1936, and the law of
April 2nd, 1936, instituting a special tax on the distribution of electric
power purchased from undertakings not subject to tax.
B. - To order the respondent Party to take all administrative, legislative
or other measures necessary:
1. To reinstate the Electricity Company of Sofia and Bulgaria in its rights
as against both the State of Bulgaria and the Municipality, also as against
any public or private consumer of current;
2. To ensure repayment to the Electricity Company of Sofia and Bulgaria of
all undue payments made by it as a result of the measures complained of and
compensation for any sums due which it has been prevented from collecting as
a result of these measures.
C. - To authorize the Belgian Government to specify the damage sustained by
the Electricity Company of Sofia and Bulgaria as a result of the facts set
out above. "
[14] On November 25th, 1938, that is to say before the expiration of the
time-limit finally fixed for the filing of the Counter-Memorial, the Agent
for the Bulgarian Government filed a document entitled "Memorial of the
Bulgarian Government" in which, as the conclusion of a preliminary objection
to the jurisdiction, he prayed the Court:
"To declare that it has no jurisdiction to entertain the Appli cation filed
by the Belgian Government on January 26th, 1938.
To dismiss all the claims, pleas and submissions of the Belgian Government.
"
[15] The proceedings on the merits having, under Article 62, paragraph 3, of
the Rules of Court, been suspended by the filing of the objection, the
President of the Court, on November 30th, 1938, made an Order fixing January
25th, 1939, as the date of expiration of the time allowed to the Belgian
Government for the presentation of a written statement of its [p69]
observations and submissions in regard to the objection raised by the
Bulgarian Government.
[16] The Belgian Government's written statement, entitled "Additional
Memorial", was duly filed on January 25th, 1939, and accordingly on that
date the case became ready for hearing in regard to the objection of the
Bulgarian Government.
[17] In this written statement, the Belgian Government prayed the Court:
"To declare that it has jurisdiction,
To order the respondent Party to plead on the merits and to fix the
time-limits for the further written proceedings. "
[18] In the course of public sittings held on February 27th and 28th, and
March 1st, 1939, the Court heard:
M. Ivan Altinoff, Agent, and Maitre Gilbert Gidel on behalf of Bulgaria; and
M. J. G. de Ruelle, Agent, and Maitre Henri Rolin on behalf of Belgium.
[19] The submissions made in the written proceedings were not amended on
either side in the course of the oral proceedings.
[20] Documents in support of their contentions were filed on behalf of
either Party [FN1].
---------------------------------------------------------------------------------------------------------------------
[FN1] See list in annex.
---------------------------------------------------------------------------------------------------------------------
[21] The above being the state of the proceedings, the Court must now
adjudicate.
***
[22] The facts are as follows:
[23] A concession for the distribution of electric current for light and
power was granted by the Municipality of Sofia in 1898 to a French company,
the Soci�t� des Grands Travaux de Marseille. In 1909 the said French company
transferred its rights to the "Electricity Company of Sofia and Bulgaria", a
company founded in Brussels on September 8th, 1908, by a notarial act
published in the Moniteur belge on September 23rd, 1908. The transfer was
approved by the Municipality of Sofia with some modifications of the
original contract, the concession being due to expire on December 31st,
1940. The rights and obligations of exploitation are set out in the contract
of concession of 1898, the specification annexed thereto, and the contract
of transfer of 1909.
[24] During the War of 1914-1918, which found Belgium and Bulgaria on
opposite sides, the works of the Belgian Company were taken over by the
Municipality of Sofia on [p70] September 1st, 1916. After the conclusion of
peace, the Belgian Company, under Article 182 of the Treaty of Neuilly of
November 27th, 1919, was given the right to restitution of its property with
an indemnity to be assessed by a Mixed Arbitral Tribunal, which was also
entrusted with the task of adapting the concession contract to the new
economic conditions in case of disagreement between the parties.
Consequently, a suit was instituted by the Company before the Belgo-Bulgarian
Mixed Arbitral Tribunal against the State of Bulgaria and against the
Municipality of Sofia.
[25] On July 5th, 1923, the Belgo-Bulgarian Mixed Arbitral Tribunal gave a
first judgment decreeing inter alia the restitution of the Belgian Company's
property and the restoration of its position as existing before the war,
subject to modifications to be decided by the Mixed Arbitral Tribunal in
application of Article 182 of the Treaty of Neuilly. Accordingly, the Mixed
Arbitral Tribunal nominated a commission of experts for the purpose of
fixing a flexible tariff - which should take into account the new economic
conditions and future variations of different elements relevant to the
fixing of the sale-price of electric current - such as salaries, the rate of
the lev and its purchasing power - and also for the purpose of assessing the
amount of the indemnity. The expert's deposited their report on March 3rd,
1924, with the Mixed Arbitral Tribunal, which on May 27th, 1925, delivered
its final judgment (a clerical error in which was corrected by a judgment
rendered on October 30th, 1925). This judgment, in brief: (1) dismissed the
applicant's claims against the State of Bulgaria; (2) ordered the immediate
restitution of the Company's property, the payment of a sum of 9, 000, 000
Belgian francs by the Municipality of Sofia to the Company, the prolongation
of the concession to December 31st, i960, and the acceptance of the formula
arrived at by the experts for fixing the selling price.
[26] The application of the formula, which is composed of different factors,
such as "P" (price of coal), "t" (cost of transport), "T" (rate of
exchange), "S" (salaries), "x" (taxation), appears to have encountered no
serious difficulties until the last quarter of 1934, when a controversy
arose in regard to the value to be assigned to the factor "P"..
[27] On October 6th, 1934, the Electricity Company communicated to the
Municipality as usual the data for the determination of the tariff for the
fourth quarter of 1934. The value attributed to the term "P" therein was 330
leva. The Municipality requested that the documents in support of the
figures should be furnished.
[28] On October 24th, 1934, the State Mines Administration delivered to the
Electricity Company a certificate indicating [p71] that the price of second
quality coal was 360 leva per ton for the "first zone". This certificate was
forwarded by the Electricity Company on November 15th, 1934, to the
Municipality, which informed the Company on November 20th that it could not
accept the certificate supplied by the Mines Administration on October 24th,
1934, because it related to second quality coal at that particular time and
not to second quality coal unsorted (tout-venant) as produced in 1925 and as
referred to in the judgment of the Mixed Arbitral Tribunal.
[29] On November 26th, 1934, the Company received from the State Mines
Administration a notice stating that, by a decision of November 24th of the
Board of Directors, the prices of coal destined for the production of
electric current were fixed at a certain figure. The Electricity Company
protested against this figure, but finally an agreement, with certain
reservations, was reached fixing the tariff for the year 1935 at a certain
rate per kilowatt-hour of current distributed.
[30] After the devaluation of the Belgian franc on April 1st, 1935, the
Electricity Company, by a letter addressed to the Municipality on October
29th of that year, observed that the introduction of the new rate of
exchange in the calculation of the tariff according to the formula of the
Mixed Arbitral Tribunal led to results very near to those agreed on for the
year 1935 and announced its decision to adhere strictly, for the year 1936,
to the judgments of the Mixed Arbitral Tribunal, pointing out that the term
"P" should be understood as applying to the second quality of coal appearing
in the price list at the time when the formula was established.
[31] On December 13th, 1935, the Municipality replied by letter that the
formula contained elements that were inapplicable and led to absurd results,
in that it did not take into consideration the real state of affairs and the
economic condition prevailing in Sofia. No agreement was reached on this
issue and, by letter dated January 31st, 1936, the Municipality expressed
its intention no longer to authorize the Company to recover from consumers
the amount of the excise duty.
[32] A new exchange of letters between the Company and the Municipality also
led to no result.
[33] By a note verbale dated January 28th, 1936, the Belgian Legation at
Sofia proposed to the Bulgarian Minister of Foreign Affairs the joint
submission by the Municipality and the Company to the Mixed Arbitral
Tribunal of the divergences of interpretation to which the factor "P" (price
of coal) in the formula had given rise. To this the Bulgarian Ministry for
Foreign Affairs, by [p72] a note verbale dated February 18th, 1936, replied
that the Municipality and the Ministry of Agriculture could not accept this
proposal. The note verbale added that the Mixed Arbitral Tribunal no longer
existed and could not be revived, and that the Municipality had therefore
seen fit to have recourse to the only tribunal competent to adjudicate in
the matter, namely the Regional Court of Sofia.
[34] The Company having seized the Mixed Arbitral Tribunal the Council of
the League of Nations, in application of provisions in the Treaty of Neuilly,
appointed a substitute in the place of the Bulgarian arbitrator on the Mixed
Arbitral Tribunal. Tha Tribunal rendered a judgment on December 29th, 1936,
declaring the claim of the Company inadmissible, either as a request
concerning the interpretation of the original award, because the time-limit
for this had expired, or as a request for execution, because the latter was
a question exclusively for the two Governments.
[35] Meanwhile, as had already been stated, the Municipality had instituted
a suit against the Company before the Regional Court of Sofia for the
determination of the rights and obligations in respect of the sale price of
electric current. In this suit the Municipality also claimed that the
Company had no right to collect either from the subscribers or from the
Municipality the price of the current consumed calculated according to the
formula of the arbitral judgment until the price in question had been
approved by the Municipality, according to Article 21 of the contract
specification. It further asked for the appointment of experts to establish
the real value of the factors "P" (price of coal) and "x" (taxation) and,
thereby, the legal sale price per kilowatt-hour.
[36] In its defence the Company contested both the jurisdiction of the
Regional Court and the admissibility of the suit; alternatively, on the
merits, it requested that, in case the Court should order an expert enquiry
as to the terms "P" (price of coal) and "x" (taxation), it should have the
terms "S" (salaries) and "r" (exchange) likewise examined.
[37] The Regional Court, in its decision of October 24th, 1936, on the
merits, found in favour of the Municipality as regards the interpretation of
the terms "P" (price of coal) and "r" (exchange) and, to a certain extent,
in favour of the Company as regards the interpretation of the term "x"
(taxation).
[38] Both parties appealed to the Sofia Court of Appeal which by its
judgment of March 27th, 1937, confirmed that part of the judgment of the
Regional Court which was in favour of the Municipality and reversed that
part which. was in favour of the Company. An appeal against this judgment
was made by the Company on June 23rd, 1937, to the Court of Cassation. [p73]
[39] In the meantime a new income tax law dated January 24th, 1936, was
promulgated on February 3rd of the same year by the Bulgarian Government.
Article 30 of this law created a different rate of taxation as between
electricity companies producing electric current themselves and those
purchasing it from undertakings not subject to taxation; the Article was
subsequently defined, in respect of Municipalities, by a circular published
in the Official Journal of March 4th, 1936, and modified, in respect of
State mines and hydraulic syndicates, by a law dated April 2nd, 1936,
published in the Official Journal of April 16th, 1936.
[40] On May 18th, 1936, the Company wrote to the Bulgarian Minister of
Finance, saying that there was an error in the estimation of the tax
referred to in Article 30 (b) of the Income Tax Law dated January 24th,
1936, and promulgated on February 3rd of the same year, and requested him to
verify the accuracy of the figures submitted by it and to make the
corresponding corrections in the said Article.
[41] On April 22nd, 1937, the Belgian Minister at Sofia, in a letter to the
Bulgarian President of the Council and Minister for Foreign Affairs and
Public Worship, complained of the attitude of the Mayor of Sofia in invoking
the judgment of the Court of Appeal, against which the Company had decided
to appeal to the Court of Cassation, adding that "the Electricity Company
has never ceased to declare that it will comply with any judgment by the
Bulgarian courts which, after the exhaustion of all the remedies provided
for in the proceedings, shall have acquired the effect of a final judgment",
and that "the recent judgment of the Court of Appeal has no executory force,
because the action brought against the Electricity Company by the Mayor was
for the purpose of determining facts (constatatoire) and not for the purpose
of securing a conviction (condamnatoire)".
[42] On June 24th, 1937, the Belgian Minister at Sofia, in a letter to the
Bulgarian President of the Council and Minister for Foreign Affairs and
Public Worship, referred to the dispute between the Municipality and the
Company as one resulting from the intervention of "certain administrative
and judicial authorities of the Bulgarian State". The Belgian Minister
expressed the view that the decision of the Court of Appeal of Sofia on
March 27th, 1937, had disregarded the rights of the Company as defined by
the Belgo-Bulgarian Mixed Arbitral Tribunal in its judgments of July 5th,
1923, and May 27th, 1925. In these circumstances the Minister intimated that
the dispute in question was one which, according to Articles 4 and 6 of the
Treaty of conciliation, arbitration and judicial settlement entered into
between Bulgaria and Belgium on June 23rd, 1931, might be unilaterally
submitted to the Permanent Court of International Justice "(� la clause de
comp�tence obligatoire de laquelle la Bulgarie, a, d'autre part, adhere
[p74] le 21 ao�t 1921)", unless an agreement was reached to submit it to
arbitration. He therefore proposed to the Bulgarian Government that the case
should be referred to the Permanent Court of International Justice by means
of a special agreement and added that, if no agreement on the terms of this
special agreement could be reached in two months, the Belgian Government,
availing itself of its rights, would bring the case before the Permanent
Court of International Justice unilaterally by application.
[43] In a letter of July 30th, 1937, addressed to the President of the
Council and Minister for Foreign Affairs and Public Worship, the Belgian
Minister in Sofia repeated and confirmed this declaration.
[44] On August 3rd, 1937, the Bulgarian President of the Council arid
Minister for Foreign Affairs and Public Worship replied by letter to the
Belgian Minister at Sofia that, as in his opinion the disputes between the
Municipality and the Company "depend on the exclusive competence of the
Bulgarian tribunals which have already had occasion to render their decision
to this effect", the Bulgarian Government. could not agree to a proposition
of compromise tending to bring this dispute before another jurisdiction, and
that, "in so far as the communication that, in default of a compromise, the
Belgian Government, basing itself on Articles 4 and 6 of the Treaty of
conciliation, arbitration and judicial settlement between Bulgaria and
Belgium, would lay the case unilaterally before the Permanent Court of
International Justice, is concerned", the Bulgarian Government, by
application of Article 3 of that Treaty, claimed in this case the
jurisdiction of its own tribunals and could not consent to the dispute being
submitted to the various procedures provided in the Treaty. By the same
letter the Bulgarian Government informed the Belgian Government that
Bulgaria denounced the Treaty in accordance with the third paragraph of
Article 37 of that instrument.
[45] On January 26th, 1938, the Belgian Government filed with the Registry
of the Court the Application instituting the present proceedings.
[46] On March 16th, 1938, the Court of Cassation dismissed the appeal made
by the Company on June 23rd, I937.
[47] These are the facts, undisputed in the present case, having regard to
which the Court is now called upon to adjudicate upon the preliminary
objection raised by the Bulgarian Government.
***
[48] Before considering the preliminary objection upon which the Court has
to adjudicate, the attitude of the Parties with regard to the grounds on
which they have based their arguments must be determined. [p75]
[49] In order to found the jurisdiction of the Court, the Belgian
Government, both in its Application and in its Memorial, relies on the one
hand on the Declarations of Belgium and Bulgaria accepting the compulsory
jurisdiction of the Court, Declarations which were ratified on March 10th,
1926, and August 12th, 1921, respectively; and, on the other hand, on the
Treaty of conciliation, arbitration and judicial settlement of June 23rd,
1931, which came into force on February 4th, 1933 [FN1].
---------------------------------------------------------------------------------------------------------------------
[FN1] League of Nations Treaty Series, Vol. 137, p. 191.
---------------------------------------------------------------------------------------------------------------------
[50] The Bulgarian Government for its part has also relied on both, of these
agreements to support its preliminary objection to the jurisdiction.
[51] In these written proceedings, the Parties adopted the same method in
their endeavour to establish that their respective contentions were well
founded; that is to say, they examined the Belgian Application of January
1938 in the light of the conditions independently laid down by each of these
two agreements. Neither the Bulgarian Government nor the Belgian Government
at any time considered the possibility that either of these agreements might
have imposed some restriction on the normal operation of the other during
the period for which they were both in force.
[52] The same attitude was adopted by the Agents of the two Governments in
the oral proceedings. Thus the Agent for the Belgian Government stated that
"either of these two instruments in reality suffices by itself to support
our claims, and it would be most regrettable if the conclusion were reached
that the simultaneous existence of the two instruments weakens our
position". It is true that one of the Counsel for the Belgian Government at
one time expressed the personal opinion - which he subsequently described as
a "suggestion" - that "from February 3rd, 1933, the date of the coming into
force of the Treaty of 1931, until February 3rd, 1938", the legal relations
between Belgium and Bulgaria had been governed by the Treaty of 1931 alone.
In the afternoon however of the same hearing, the same Counsel retracted his
personal opinion or suggestion and declared that "the Treaty was only to be
regarded as having suspended the optional clause in so far as it modified
that clause".
[53] This led the Agent for the Bulgarian Government to take up a definite
position on the point. He proceeded to demonstrate by numerous arguments
that "the signature of the Treaty of conciliation of 1931 between Bulgaria
and Belgium, which refers in Article 4 to the disputes enumerated in Article
36 of the Court's Statute, in no way suspended the operation of the optional
clause.... ". "On the contrary", he said, "far from tacitly abrogating, or
at any rate suspending the operation of [p76] the optional clause for the
duration of the Treaty, the two paragraphs of Article 4 simply reinforce and
do not set aside the obligation resulting from the optional clause. "
[54] The Court holds that the suggestions first made by Counsel for the
Belgian Government cannot be regarded as having the effect of modifying that
Party's attitude in regard to this question. The Belgian Government in fact
has always been in agreement with the Bulgarian Government in holding that,
when the Application was filed, their declarations accepting the Court's
jurisdiction as compulsory were still in force.
[55] The Court shares the view of the Parties. In its opinion, the
multiplicity of agreements concluded accepting the compulsory jurisdiction
is evidence that the contracting Parties intended to open up new ways of
access to the Court rather than to close old ways or to allow them to cancel
each other out with the ultimate result that no jurisdiction would remain.
[56] In concluding the Treaty of conciliation, arbitration and judicial
settlement, the object of Belgium and Bulgaria was to institute a very
complete system of mutual obligations with a view to the pacific settlement
of any disputes which might arise between them. There is, however, no
justification for holding that in so doing they intended to weaken the
obligations which they had previously entered into with a similar purpose,
and especially where such obligations were more extensive than those ensuing
from the Treaty.
[57] It follows that if, in a particular case, a dispute could not be
referred to the Court under the Treaty, whereas it might be submitted to it
under the declarations of Belgium and Bulgaria accepting as compulsory the
jurisdiction of the Court, in accordance with Article 36 of the Statute, the
Treaty cannot be adduced to prevent those declarations from exercising their
effects and disputes from being thus submitted to the Court.
[58] It is necessary therefore in the first place to consider whether the
objections raised by the Bulgarian Government to the jurisdiction of the
Court under the Treaty are well-founded or not. Should they prove
well-founded, the Court will then consider the objections raised by that
Government under the declarations above mentioned. Only if both these sets
of objections are alike held to be well-founded will the Court decline to
entertain the case.
[59] The Court will consider the bearing of the arguments of the Bulgarian
Government on the final submissions of the Belgian' Government's Application
under A, Nos. 1 and 2, respecting the complaints concerning the application
by the Bulgarian authorities of the decisions of the Mixed Arbitral Tribunal
[p77] in 1923 and 1925; it will then consider their bearings on the
submission made under A, No. 3, which relates to the promulgation of the
Bulgarian law of February 3rd, 1936, concerning income tax.
*
[60] The Court will first examine the Bulgarian argument concerning the
application of the Treaty of 1931, which was relied on in the first place by
the Belgian Government in its Memorial of August 26th, 1938.
[61] In support of its Application, the Belgian Government invokes Article 4
of the Treaty, which runs as follows:
"All disputes with regard to which the Parties are in conflict as to their
respective rights shall be submitted for decision to the Permanent Court of
International Justice, unless the Parties agree, in the manner hereinafter
provided, to have resort to an arbitral tribunal.
It is understood that the disputes referred to above include in particular
those mentioned in Article 36 of the Statute of the Permanent Court of
International Justice. "
[62] The opposing argument of the Bulgarian Government consists of two
contentions, as follows:
[63] In the first place, the Bulgarian Government complains of the silence
of the Belgian Memorial as to the respective "rights" in regard to which the
Parties are in conflict; that Government supposes that the right which is
denied to Bulgaria is the right of deciding disputes that arise between the
Belgian concessionaire and the Bulgarian grantor of a public service in
Bulgaria, on the subject of the application of the formula determining the
price of electric current. "The Bulgarian Government insists that the right
of the Bulgarian authorities to exercise jurisdiction over disputes
concerning the application of provisions governing the working conditions of
a public service conceded in Bulgaria to a foreign concessionaire, is
inherent in the sovereignty of the Bulgarian State. The Bulgarian Government
protests against any claim to invoke the Treaty of pacific settlement of
June 23rd, 1931, for the purpose of disputing this right."
[64] The Belgian Government explains in its Additional Memorial of January
22nd, 1939, that "the rights which the Belgian Government relies on.... are
the right to the cessation of acts prejudicial to the Electricity Company of
Sofia and Bulgaria, carried out by various organs of the Bulgarian State, in
violation of the latter's international obligations, and the right to obtain
reparation for the damage resulting for the Belgian Company"; the Belgian
Government has thus raised a point of an international character in this
dispute. This last point has been [p78] contested from the outset and
particularly during the discussion of the question whether the Belgian
complaints do or do not fall within one or other of the categories of
disputes referred to in Article 36 of the Statute (also mentioned in Article
4 of the Treaty of 1931). But the argument ratione materi� thus developed
and used in support of the preliminary objection to the jurisdiction forms a
part of the actual merits of the dispute. The Court cannot therefore regard
this plea as possessing the character of a preliminary objection within the
meaning of Article 62 of the Rules.
[65] In the second place, the Bulgarian Government raised an argument based
on the non-observance of the provisions of Article 3 of the Treaty by the
Belgian Government.
[66] This Article is as follows:
"1. In the case of a dispute the occasion of which, according to the
municipal law of one of the High Contracting Parties, falls within the
competence of its judicial or administrative authorities, the Party in
question may object to the matter in dispute being submitted for settlement
by the different methods laid down in the present Treaty until a decision
with final effect has been pronounced within a reasonable time by the
competent authority.
2. In such a case the Party which desires to resort to the procedures laid
down in the present. Treaty must notify the other Party of its intention
within a period of one year from the date of the under-mentioned decision. "
[67] The Bulgarian Government alleges that the Application of January 26th,
1938, was introduced before a decision with final effect - namely the
judgment of the Bulgarian Court of Cassation - was rendered, and that on
that ground the application was premature and irregular.
[68] As regards the application of Article 3 of the Treaty of 1931, the
following considerations must be borne in mind.
[69] This Article 3 occurs in Chapter I headed "Pacific Settlement in
general", amongst provisions of a general nature, applicable to all the
procedures provided for in the Treaty of 1931. This fact alone serves to
show the importance attached to the clause relating to the exhaustion of
local remedies, which applies to all the procedures mentioned.
[70] Article 3 itself consists of two paragraphs.
[71] The hypothesis in paragraph 1 is that, according to the municipal law
of one of the High Contracting Parties, the subject of the dispute is within
the jurisdiction of its judicial or administrative authorities. This
hypothesis is fulfilled in the present case; for the Belgian Government does
not deny that the dispute between the Belgian Electricity Company and the
Bulgarian authorities concerning alleged failure by the Bulgarian
authorities to observe the formula drawn up by the [p79] Mixed Arbitral
Tribunal is within the jurisdiction of the Bulgarian courts.
[72] The same Article authorizes the respondent Party to "object to the
matter in dispute being submitted for settlement by the different methods
laid down in the present Treaty". This formality was observed by the
Bulgarian Government, in particular in the letter addressed to the Belgian
Minister in Sofia by the President of the Council, Minister for Foreign
Affairs and Public Worship, and dated Sofia August 3rd, 1937; in this
letter, of which the date is several months earlier than the introduction of
the Application on January 26th, 1938, is the following passage: "With
reference to the communication that, failing a special agreement, the
Belgian Government would make a unilateral application to the Permanent
Court of International Justice, relying on Articles 4 and 6 of the Treaty of
conciliation, arbitration and judicial settlement between Bulgaria and
Belgium, I feel bound to draw your Government's attention to the fact that,
in application of Article 3 of that Treaty, the Bulgarian Government claims
that its own courts have jurisdiction in this matter, and it cannot consent
to the submission of the dispute to the different procedures provided in the
said Treaty. "
[73] The following words of Article 3, No. 1, indicate the limit of time
imposed on the submission of an application: ".... until a decision with
final effect has been pronounced within a reasonable time by the competent
authority".
[74] There being no dispute as to the reasonableness of the time within
which the decision was pronounced, the controversy is reduced to the
following question: at the time of the application was there a decision with
final effect, or had that decision with final effect not yet been
pronounced?
[75] The Belgian Government claims that it has not failed to observe the
provisions of Article 3, No. 1, seeing that the subsequent decision of the
Court of Cassation could not have been regarded by the contracting Parties
to be that referred to in Article 3, No. 1; this ultimate Court constitutes
an extraordinary remedy, and in any case the appeal in cassation had been
lodged and this fact might be deemed to constitute a fulfilment of the
required condition.
[76] Whatever the term applied by the Sofia Court of Appeal to its judgment,
the fact remains that it was not a decision with final effect within the
meaning given to that expression by Article 3, No. 1. The local remedies
rule contemplated by the Treaty of 1931 implies the exhaustion of all
appeals, including appeals to the Court of Cassation, a decision by which
alone renders the judgment final either by annulling the judgment of the
Court of Appeal and sending the case back for a re-trial, or by rejecting
the appeal. [p80]
[77] No. 2 of Article 3 still further emphasizes the importance of the
provision in No. 1; for, according to No. 2, a Party which desires in the
circumstances contemplated by No. 1 to resort to the procedures laid down in
the Treaty must notify the other Party of its intention within a period of
one year from the date of the decision with final effect referred to in No.
1.
[78] The Belgian Government has vainly relied upon Article 37 (4) which runs
as follows:
"4. Notwithstanding denunciation by one of the High Contracting Parties, the
proceedings pending at the expiration of the current period of the Treaty
shall be duly completed. "
[79] This clause does not apply: it presupposes proceedings validly
instituted, and this, is not the case here owing to the absence of a
decision with final effect on January 26th, 1938. Moreover, the irregularity
of the Belgian Application was not removed by the judgment rendered on March
16th, 1938, by the Bulgarian Court of Cassation, for in the meantime, i. e.
on February 4th, 1938, the Treaty of 1931 had expired, having been denounced
by the Bulgarian Government.
[80] Accordingly, since the Belgian Application has not been submitted in
accordance with the conditions laid down by the Treaty of 1931, the Belgian
Government cannot found the jurisdiction of the Court on that Treaty.
*
[81] The negative result arrived at by the examination of the first source
of jurisdiction does not however dispense the Court from the duty of
considering the other source of jurisdiction invoked separately and
independently from the first.
[82] The Court will now proceed to consider the Bulgarian Government's
argument relating to the declarations of adherence to the Optional Clause of
the Court's Statute.
[83] With regard to their terms, the declarations of adherence of Bulgaria
and Belgium differ in that the declaration of the Bulgarian Government runs
as follows:
"On behalf of the Government of the Kingdom of Bulgaria I recognize, in
relation to any other Member or State which accepts the same obligation, the
jurisdiction of the Court as compulsory ipso facto and without any special
convention, unconditionally",
and contains no reservation apart from the condition of reciprocity, whereas
the declaration of the Belgian Government runs as follows: [p81]
"On behalf of the Belgian Government, I recognize as compulsory, ipso facto
and without special agreement, in relation to any other Member or State
accepting the same obligations, the jurisdiction of the Court in conformity
with Article 36, paragraph 2, of the Statute of the Court for a period of
fifteen years, in any disputes arising after the ratification of the present
declaration with regard to situations or facts subsequent to this
ratification, except in cases where the Parties have agreed or shall agree
to have recourse to another method of pacific settlement. "
[84] The Bulgarian Government relies on the limitation ratione temporis
embodied in the Belgian declaration concerning the situations or facts with
regard to which the dispute has arisen, in order to dispute the jurisdiction
of the Court. Although this limitation does not appear in the Bulgarian
Government's own declaration, it is common ground that, in consequence of
the condition of reciprocity laid down in paragraph 2 of Article 36 of the
Court's Statute and repeated in the Bulgarian declaration, it is applicable
as between the Parties.
[85] The Parties agree that the date on which the dispute arose was June
24th, 1937, i. e., after March 10th, 1926 - the date of the establishment of
the juridical bond between the two States under Article 36 of the Court's
Statute.
[86] On the other hand, the Bulgarian Government in its argument raises the
following point: Although the facts complained of by the Belgian Government
in the submissions of its Application under A, Nos. 1 and 2, all date from a
period subsequent to March 10th, 1926, the situation with regard to which
the dispute arose dates back to a period before that date. This situation
was created by the awards of the Belgo-Bulgarian Mixed Arbitral Tribunal and
in particular by the formula established by the awards of July 5th, 1923,
and May 27th, 1925, for the fixing of the price per kilowatt-hour of power
distributed. The complaints made by the Belgian Government concerning the
application of this formula by the Bulgarian authorities relate, it is
contended, to the working of that formula and make it the centre point of
the dispute. It has also been argued that since the situation resulting from
that formula dates from before the material date, namely, March 10th, 1926,
the Bulgarian Government is justified in holding that the dispute which has
arisen in regard to it falls outside the Court's jurisdiction by reason of
the limitation ratione temporis contained in the Belgian declaration.
[87] The Court cannot accept this view. It is true that it may be said that
the awards of the Mixed Arbitral Tribunal established between the Belgian
Electricity Company and the Bulgarian authorities a situation which dates
from before March 10th, [p82] 1926, and still persists at the present time.
Nevertheless, the dispute between the Belgian Government and the Bulgarian
Government did not arise with regard to this situation or to the awards
which established it. The Court would recall in this connection what it said
in the Judgment of June 14th, 1938 (Phosphates in Morocco. Preliminary
Objection). The only situations or facts which must be taken into account
from the standpoint of the compulsory jurisdiction accepted in the terms of
the Belgian declaration are those which must be considered as being the
source of the dispute. No such relation exists between the present dispute
and the awards of the Mixed Arbitral Tribunal. The latter constitute the
source of the rights claimed by the Belgian Company, but they did not give
rise to the dispute, since the Parties agree as to their binding character
and that their application gave rise to no difficulty until the acts
complained of. It is not enough to say, as it is contended by the Bulgarian
Government, that if it had not been for these awards, the dispute would not
have arisen, for the simple reason that it might just as well be said that,
if it had not been for the acts complained of, the dispute would not have
arisen. It is true that a dispute may presuppose the existence of some prior
situation or fact, but it does not follow that the dispute arises in regard
to that situation or fact. A situation or fact in regard to which a dispute
is said to have arisen must be the real cause of the dispute. In the present
case it is the subsequent acts with which the Belgian Government reproaches
the Bulgarian authorities with regard to a particular application of the
formula - which in itself has never been disputed - which form the centre
point of the argument and must be regarded as constituting the facts with
regard to which the dispute arose. The complaints made in this connection by
the Belgian Government relate to the decision of the Bulgarian State
Administration of Mines of November 24th, 1934, and to the judgments of the
Bulgarian courts of October 24th, 1936, and March 27th, 1937. These are
facts subsequent to the material date. Accordingly, the Court considers that
the argument based on the limitation ratione temporis in the Belgian
declaration is not well-founded.
[88] In connection with the Belgo-Bulgarian declarations of acceptance of
the Court's compulsory jurisdiction, the Bulgarian Government puts also
forward another argument in support of its objection to the jurisdiction. In
its contention, the present dispute does not fall within any of the
categories of Article 36 of the Court's Statute, a general provision which
enumerates the legal disputes for which the Court is competent. Although
this argument is designed to prove that the Court has no jurisdiction and to
prevent the proceedings from being continued, the Court, after considering
its scope, has arrived at the conclusion [p83] that this objection is
closely linked to the merits of the case. The reasoning in fact aims at
establishing that there is no international element in the legal relation
created between the Belgian Company and the Bulgarian authorities by the
awards of the Mixed Arbitral Tribunal. But that amounts not only to
encroaching on the merits, but to coming to a decision in regard to one of
the fundamental factors of the case. The Court cannot therefore regard this
plea as possessing the character of a preliminary objection within the
meaning of Article 62 of the Rules.
[89] In these circumstances, the Court cannot accept the contention that it
lacks jurisdiction under the declarations of adherence to the Optional
Clause, in so far as this contention is based on the argument ratione
temforis; and in so far as this contention is founded on the argument
ratione materi�, the Court does not regard it as preliminary in character
and consequently rejects it, though the Parties remain free to take it up
again in support of their case on the merits.
[90] The attempt to prove that the Court lacks jurisdiction under the
Optional Clause is thus unsuccessful as regards A, No. 1, and A, No. 2.
*
[91] The last complaint adduced by the Belgian Government to the Bulgarian
Government - which is formulated in its submissions under A, No. 3, of the
Belgian Application, relates to the promulgation of the law of February 3rd,
1936, of which Article 30, paragraph C, institutes a special tax on the
distribution of electric power sold to concerns not subject to tax.
[92] In the contention of the Belgian Government, the promulgation of the
law constitutes a failure by the Bulgarian Government to observe its
international obligations, owing to the discriminatory character of this
law.
[93] The Bulgarian Government argues that this contention of the Belgian
Government is inadmissible because the claim respecting the law of February
3rd, 1936, did not form the subject of a dispute between the two Governments
prior to the filing of the Belgian Application.
[94] The Court considers this argument of the Bulgarian Government to be
well-founded. Under either the Treaty of 1931 or the declarations of
adherence to the Optional Clause it rested. with the Belgian Government to
prove that, before the filing of the Application, a dispute had arisen
between the Governments respecting the Bulgarian law of February 3rd, 1936.
The Court holds that the Belgian Government has not established the
existence of such a dispute and accordingly declares 'that the Belgian
Application cannot be entertained in so far as concerns that part of the
claim relating to this law. [p84]
[95] FOR THESE REASONS,
The Court, by nine votes to five,
Adjudicating upon the preliminary objection raised by the Bulgarian
Government to the Application of the Belgian Government:
1. With regard to points 1 and 2 of Submission A of the Application,
overrules the objection of the Bulgarian Government; reserves this part of
the Application of the Belgian Government for judgment on the merits;
states that the time-limits for the continuance of the proceedings will be
fixed by an Order bearing the date of the present judgment.
2. With regard to point 3 of Submission A of the Application,
upholds the objection of the Bulgarian Government; and dismisses this part
of the Application of the Belgian Government.
[96] The present judgment has been drawn up in French in accordance with
Article 39, paragraph 1, of the Statute of the Court, the Parties having
agreed that the case should be conducted in French.
[97] Done at the Peace Palace, The Hague, this fourth day of April, one
thousand nine hundred and thirty-nine, in three copies, one of which will be
deposited in the archives of the Court and the others will be communicated
to the Government of the Kingdom of Belgium and to the Government of the
Kingdom of Bulgaria, respectively.
(Signed) J. G. Guerrero,
President.
(Signed) J. L�pez Oliv�n,
Registrar. [p85]
[98] M. Anzilotti, M. Urrutia, Jonkheer Van Eysinga, M. Hudson, Judges, and
M. Papazoff, Judge ad hoc, declare that they are unable to concur in the
judgment given by the Court and, availing themselves of the right conferred
upon them by Article 57 of the Statute, have appended to the judgment the
separate opinions which follow.
[99] M. De Visscher and M. Erich, Judges, while in agreement with the
operative clause of the judgment, have each appended observations regarding
some of the grounds.
(Initialled) J. G. G.
(Initialled) J. L. O. [p86]
Separate Opinion by M. Anzilotti.
[Translation]
[100] I regret that I am unable to agree with the way in which the judgment
views the relation between the two sources of jurisdiction relied upon by
the applicant Party. This question is so important and its bearing is so
wide that I find myself obliged to explain the reasons for my dissent.
[101] 1.- The facts of the situation giving rise to this question are
briefly as follows.
[102] On July 29th, 1921, the Bulgarian Government signed a Declaration
adhering to the Optional Clause concerning the compulsory jurisdiction of
the Permanent Court of International Justice in the following terms :
"On behalf of the Government of the Kingdom of Bulgaria I recognize, in
relation to any other Member or State which accepts the same obligation, the
jurisdiction of the Court as compulsory ipso facto and without any special
convention, unconditionally."
[103] This Declaration was ratified on August 12th of the same year.
[104] The Belgian Government signed its Declaration accepting the compulsory
jurisdiction of the Court on September 25th, 1925. This Declaration is as
follows :
"On behalf of the Belgian Government, I recognize as compulsory, ipso facto
and without special agreement, in relation to any other Member or State
accepting the same obligations, the jurisdiction of the Court in conformity
with Article 36, paragraph 2, of the Statute of the Court for a period of
fifteen years, in any dispute arising after the ratification of the present
Declaration with regard to situations or facts subsequent to this
ratification, except in cases where the Parties have agreed or shall agree
to have recourse to another method of pacific settlement."
[105] The ratification was deposited on March 10th, 1926.
[106] Article 36 of the Court's Statute to which the two Declarations refer
is as follows :
"The jurisdiction of the Court comprises all cases which the parties refer
to it and all matters specially provided for in treaties and conventions in
force.
The Members of the League of Nations and the States mentioned in the Annex
to the Covenant may, either when signing [p87] or ratifying the Protocol to
which the present Statute is adjoined, or at a later moment, declare that
they recognize as compulsory ipso facto and without special agreement, in
relation to any other Member or State accepting the same obligation, the
jurisdiction of the Court in all or any of the classes of legal disputes
concerning :
(a) the interpretation of a treaty;
(b) any question of international law;
(c) the existence of any fact which, if established, would constitute a
breach of an international obligation ;
(d) the nature or extent of the reparation to be made for the breach of an
international obligation.
The Declaration referred to above may be made unconditionally or on
condition of reciprocity on the part of several or certain Members or
States, or for a certain time.
In the event of a dispute as to whether the Court has jurisdiction, the
matter shall be settled by the decision of the Court."
[107] As a result of these Declarations, an agreement came into existence
between the two States accepting the compulsory jurisdiction of the Court,
in conformity with Article 36 of the Statute and subject to the limitations
and conditions resulting from the declarations, more especially from that of
the Belgian Government. This agreement, hereinafter referred to as the
Declarations, came into force on March 10th, 1926, the date of the Belgian
ratification. The Bulgarian Declaration is made without limitation of time,
but the Belgian Declaration being made for a period of fifteen years as from
the date of ratification, the duration of the Declarations is until March
10th, 1941.
[108] On the other hand Belgium and Bulgaria, on June 23rd, 1931, signed a
Treaty of conciliation, arbitration and judicial settlement which was
ratified on February 4th, 1933, and Chapter II of which, entitled "Judicial
Settlement", deals, inter alia, with recourse to the Court.
[109] The articles of the Treaty of June 23rd, 1931, which should be kept in
mind on the one hand for comparison with the text of the Declarations and of
Article 36 of the Statute on the other, are in particular Articles 4, 1 and
3. The first directly concerns recourse to the Court ; the other two, which
are in Chapter I which is entitled "Pacific Settlement in general", apply to
all the procedures contemplated by the Treaty and consequently also to
recourse to the Court. These Articles are as follows :
Article 4. - "All disputes with regard to which the Parties are in conflict
as to their respective rights shall be submitted for decision to the
Permanent Court of International Justice, unless the Parties agree, in the
manner hereinafter provided, to have resort to an arbitral tribunal. [p88]
[110] It is understood that the disputes referred to above include in
particular those mentioned in Article 36 of the Statute of the Permanent
Court of. International Justice."
Article 1 . - "Disputes of every kind which may arise between the High
Contracting Parties and which it may not have been possible to settle by
diplomacy shall be submitted, under the conditions laid down in the present
Treaty, to judicial settlement or arbitration, preceded, according to
circumstances, as a compulsory or optional measure, by recourse to the
procedure of conciliation."
Article 3. - "1. In the case of a dispute the occasion of which, according
to the municipal law of one of the High Contracting Parties, falls within
the competence of its judicial or administrative authorities, the Party in
question may object to the matter in dispute being submitted for settlement
by the different methods laid down in the present Treaty until a decision
with final effect has been pronounced within a reasonable time by the
competent authority.
2. In such a case, the Party which desires to resort to the procedures laid
down in the present Treaty must notify the other Party of its intention
within a period of one year from the date of the aforementioned decision."
[111] This treaty, hereinafter called the Treaty, was concluded for a period
of five years as from the date of exchange of ratifications and was to be
automatically renewed for successive periods of five years unless denounced
at least six months before the expiration of a five year period. It was
denounced by the Bulgarian Government on August 3rd, 1937, and thus expired
on February 4th, 1938.
[112] The Application of the Belgian Government was filed on January 25th,
1938, that is to say before the date of expiration of the Treaty ; the
question therefore arises which of the rules of the Declarations and of the
Treaty are applicable to it ; in other words whether the Declarations, or
the Treaty, or both are to be taken as the basis in examining the question
whether the Court can entertain the Application and adjudicate upon the
merits of the case. It is with regard to this question that I find it
impossible to agree with the standpoint adopted in the judgment.
[113] In my opinion, when the Belgian Government's Application was filed,
only the Treaty was applicable between the two States, and it is on the
basis of the Treaty and of the Treaty alone that it has to be decided
whether the Court can entertain the Application and adjudicate on the
merits.
[114] 2. - Before setting out my arguments, one observation is necessary.
[115] The Belgian Government relies upon both the Declarations and the
Treaty in order to establish the jurisdiction of the [p89] Court to
adjudicate upon its Application. It is not quite clear whether that
Government relies upon them both equally or whether it places more reliance
on one than on the other, and if so which: in the course of the written
proceedings and more especially in the oral proceedings, there were signs of
some indecision on the point, so that it is difficult to form an absolutely
definite opinion on this subject. I regard it however as certain that the
Belgian Government holds that it can rely on both sources of the Court's
jurisdiction.
[116] As for the Bulgarian Government, in its Memorial it disputed the
jurisdiction of the Court under either the Declarations or the Treaty ; and
at the oral proceedings its Agent positively maintained, contrary to certain
observations of Counsel for the Belgian Government, that the coming into
force of the Treaty had not suspended the operation of the Declarations. It
may therefore be said that both the Parties consider that the Declarations
and the Treaty are alike applicable in this case.
[117] It appears to me certain however that this attitude on the part of the
Parties can neither dispense the Court from itself examining and answering
the purely legal question of the relation between the two sources of its
jurisdiction nor in any way restrict its freedom in this respect.
[118] The position would perhaps be different if the agreement between the
Parties had been in regard to the question whether the Court has
jurisdiction or not. But here the situation is quite otherwise: the Belgian
Government maintains and the Bulgarian Government denies that the Court has
jurisdiction. The agreement, if we can call it an agreement, only relates to
the sources of law to be applied. Such an agreement, which clearly results
from the way in which each Party views the interests of its own defence, is
of no importance for the Court.
[119] 3. - If we compare the text of the Declarations, which, together with
Article 36 of the Statute, determine the content of the Agreement concluded
between the two Governments, with the articles of the Treaty reproduced
above, it is easy to see that these constitute two conventions between the
Belgian Government and the Bulgarian Government which lay down different
rules for the same thing, namely recourse to the Court. 1
[120] Confining myself to the points of most importance in this case, I
would make the following observations.
[121] Under a clause of the Belgian Declaration which, by virtue of the
condition of reciprocity, is binding as between the Parties, the
Declarations except from the compulsory jurisdiction of the Court disputes
which, though falling under one or more of the categories set out in Article
36 of the Statute and arising subsequent to the ratification of the
Declaration, have [p90] not arisen "with regard to situations or facts
subsequent to this ratification". The Treaty does not make this reservation
: all disputes of this kind which may arise after ratification, definitely
fall within the Court's jurisdiction, as defined in Article 4, even if they
have not arisen "with regard to situations or facts subsequent to this
ratification".
[122] On the other hand, the Treaty makes recourse to the Court subject to
the conditions laid down in Articles 1 and 3, namely: in all cases there
must have been preliminary diplomatic negotiations which have proved
unsuccessful and, in certain cases, there must exist a decision with final
effect rendered by the competent judicial or administrative authorities. The
Declarations do not make these conditions; the interested Party cannot
therefore rely upon them to prevent the submission of the case to the Court.
I leave aside the question whether, and within what limits, any analogous
rules of general international law might be invoked against recourse to the
Court under the Declarations. It is clear in any case that that is something
quite different from the application of Articles 1 and 3 of the Treaty.
[123] It follows that there are or may be cases where recourse to the Court
is permitted by the Treaty but not by the Declarations, and cases where
recourse to the Court is possible under the Declarations but not under the
Treaty.
[124] It is clear that, in the same legal system, there cannot at the same
time, exist two rules relating to the same facts and attaching to these
facts contradictory consequences. It is for instance impossible that the
relations between two States should be governed at one and the same time by
a rule to the effect that, if certain conditions are fulfilled, the Court
has jurisdiction and by another rule laying down that, if the same
conditions are fulfilled, the Court has no jurisdiction - by a rule to the
effect that in certain circumstances the State concerned may have recourse
to the Court and by another to the effect that in the same circumstances-the
State has no right to do so, etc., etc. In cases of this kind, either the
contradiction is only apparent and the two rules are really coordinated so
that each has its own sphere of application and does not encroach on the
sphere of application of the other, or else one prevails over the other,
i.e., is applicable to the exclusion of the other. I know of no clearer,
more certain, or more universally accepted principle than this.
[125] To decide whether a contradiction between two rules is only apparent
and how they should be co-related to one another, or to determine which of
two contradictory rules applies to the exclusion of the other, is among the
most important and most [p91] difficult tasks in the interpretation of legal
texts. It is precisely this task which confronts the Court in the present
case.
[126] 4. - The Treaty being of later date than the Declarations, it is in
the text of the former that we must seek the intention of the Parties in
regard to rules previously in force.
[127] In this connection Article 4 of the Treaty seems to me of decisive
importance.
[128] This Article, having in its first paragraph formulated the general
rule that all disputes with regard to which the Parties are in conflict as
to their respective rights shall be submitted for decision to the Permanent
Court of International Justice, lays down in paragraph 2 : "It is understood
that the disputes referred to above include in particular those mentioned in
Article 36 of the Statute of the Permanent Court of International Justice."
[129] It follows, in the first place, that all disputes, without exception,
which may be submitted to the Court under the Declarations, may henceforward
be submitted to it under the Treaty. Whilst the clause in the first
paragraph: "disputes with regard to which the Parties are in conflict as to
their respective rights", may possibly extend beyond the classes of disputes
in Article 36 of the Statute, it is altogether out of the question that any
dispute falling within the classes of Article 36 of the Statute, shall not
be included in Article 4 of the Treaty. It also follows that the disputes
mentioned in Article 36 of the Statute and therefore forming the
subject-matter of the Declarations, are henceforth disputes "included" in
Article 4 of the Treaty : ".... the disputes referred to above include in
particular those....". This amounts to saying that they are disputes to
which Article 4 is applicable as well as the other articles of the Treaty
which apply to the disputes referred to in Article 4.
[130] Accordingly, the Treaty covers all disputes contemplated in the
Declarations and subjects them to its specific rules.
[131] This interpretation, which appears to follow naturally from the text
of Article 4, seems to me to be in perfect accord with the intention of the
Parties when they concluded their Treaty of conciliation, arbitration and
judicial settlement. Both States proposed to adopt a number of pacific
methods of "settling all international disputes" ; thus, the system was to
be complete and one in which every class of dispute was to receive the
treatment best suited to it. Since the disputes mentioned in Article 36 of
the Court's Statute are an important part of the disputes contemplated by
the Treaty, nothing was more natural than to extend to those disputes the
system of rules and [p92] safeguards which the contracting Parties thought
necessary or expedient for the attainment of their purpose.
[132] If, for example, they thought that the judicial settlement of a
dispute might usefully be preceded by diplomatic negotiations, why should
they not have extended this rule to the disputes mentioned in Article 36 ?
If it seemed just or opportune in certain cases to give the interested Party
a right to object to the method of settlement laid down in the Treaty being
employed until a decision with final effect had been pronounced by the
competent judicial or administrative authority, it was only natural to apply
that rule also to the disputes mentioned in Article 36, whenever those
disputes present the features in view of which the rule was adopted.
[133] On the other hand, it was necessary to ensure that any limitation or
reservation which the contracting Parties, or one of them, might have
attached to their acceptance of the Court's compulsory jurisdiction under
Article 36 of the Statute, should not take effect during the current period
of the Treaty. For, by excluding from the jurisdiction of the Court certain
of the disputes mentioned in Article 36 or by subordinating that
jurisdiction to other conditions than those contemplated in the Treaty, the
said limitations or reservations would have created a class of disputes not
compulsorily subject to pacific settlement, whereas the purpose of the
Treaty, as appears ipsis verbis in Article 1, was to ensure the settlement
of all disputes that might arise between the two States.
[134] It appears evident, therefore, that the rule approved in Article 4,
paragraph 2, of the Treaty, as I understand it, namely, as comprising within
this Article, and thus making subject to the Treaty, the disputes mentioned
in Article 36 of the Statute of the Court, is only a logical consequence of
the purpose and plan of this Treaty.
[135] 5. - Since the Treaty covers all disputes referred to in the
Declarations, the question arises whether the latter must not be held to
have been abrogated by the Treaty.
[136] There was no express abrogation. But it is generally agreed that,
beside express abrogation, there is also tacit abrogation resulting from the
fact that the new provisions are incompatible, with the previous provisions,
or that the whole matter which formed the subject of these latter is
henceforward governed by the new provisions
[137] I consider that it would be difficult to resist the argument in favour
of tacit abrogation, were it not for the following circumstance.
[138] The Declarations and the Treaty have not the same period of validity,
nor an indefinite period. As has already been seen, [p93] the periods of
duration of the Declarations and of the Treaty were such that the life of
the Declarations continued beyond that of the Treaty.It follows that the
coming into force of the Treaty did not entirely do away with the raison
d'�tre of the Declarations : this raison d'�tre ceased for so long as the
Treaty should be in force ; but it revived as soon as the Treaty should
terminate. On the other hand, a treaty whose purpose was to extend and
strengthen the peaceful settlement of disputes between the two States cannot
be deemed to have intended to set aside, save in so far as was strictly
necessary, an agreement which, in a more limited way, pursued the same
object. While it is true that once the Treaty had come into force, it left
ho room for the application of the Declarations, it is also true that it had
no need to suppress them.
[139] In these circumstances, it is not the abrogation of the Declarations,
but its temporary suspension which we must consider to be the effect of the
coming into force of the Treaty. It follows that the expiration of the
Treaty eliminated the obstacle standing in the way of the application of the
Declarations. The latter, never having ceased to be in force, again became
applicable at the same moment as the Treaty terminated, namely March 4th,
1938.
[140] The conclusion is that, at the moment when the Belgian Government's
Application was submitted (Jan. 26th, 1938), only the Treaty was applicable.
Consequently, the soundness of the objection to the jurisdiction raised by
the Bulgarian Government must be appreciated on the basis of the Treaty
alone.
[141] 6. - Before proceeding to this examination, it may be well to make
clear what are the claims of the Belgian Government against which the
objection is directed.
[142] The latter Government formulated its claims in the Application under
two heads, A and B. The purpose of the claim under A is to obtain from the
Court a judgment declaring that, owing to certain acts, Bulgaria has failed
in its international obligations towards Belgium; that under B concerns
reparations in respect of these alleged failures. This latter claim which,
in the Memorial, is divided into two - letter B relating to restitutio in
-pristinum and letter C to reparation of damage sustained - is without
importance at the present stage of proceedings.
[143] The alleged failure by Bulgaria to observe its international
obligations is indicated under three numbers in claim A : (1) concerns the
bringing into effect by the State Mines Administration on November 24th,
1934, of a special artificial tariff for coal supplied to electric power
stations ; (2) concerns the judgments rendered by the Regional Tribunal and
by the Sofia [p94] Court of Appeal on October 24th, 1936, and March 27th,
1937, respectively; (3) concerns the promulgation of the law of February
3rd, 1936, of which Article 30 (c) establishes a special tax on the
distribution of electric current purchased from undertakings not subject to
the tax.
[144] It must however be pointed out that complaint is made against the
tariff of November 24th, 1934, only because its object is alleged to have
been to enable the Municipality of Sofia wrongly to apply the awards of the
Mixed Arbitral Tribunal of 1923 and 1925. As complaint is also made against
the judgments of the Regional Tribunal and of the Sofia Court of Appeal on
the ground that they deprived the Company of the benefit of these awards of
the Mixed Arbitral Tribunal, it seems evident that there is here one single
alleged breach of Bulgaria's international obligations, consisting at one
time of acts of the administrative authorities (1), and at another time of
acts of the judicial authorities (2). While making every reservation as to
what were the international obligations thus violated by the Bulgarian
administrative and judicial authorities, it is therefore possible to regard
Nos. 1 and 2 of conclusion A, so far as the Court's jurisdiction is
concerned, as one single claim.
[145] On the other hand (3) which relates to an alleged discrimination in
the imposition of taxes does not concern the awards of the Mixed Arbitral
Tribunal or the obligations resulting therefrom for the Bulgarian
Government. It must therefore be dealt with separately even in connection
with the Court's jurisdiction.
[146] Thus there are two claims, the first being Nos. 1 and 2 and the second
No. 3 of conclusion A. This seems to be in accordance with the statements of
the Applicant.
[147] Against the possibility of the Court's giving judgment on these
claims, the Bulgarian Government, if I am not mistaken, puts forward three
arguments based on the Treaty : the Belgian Government's claims, or at any
rate the first of these, are said not to fall within the category of
disputes which, under Article 4, are to be submitted to the Court ; the
condition laid down by Article 3 is not fulfilled as regards either the
first or the second claim ; finally, as regards the second claim, the
condition required by Article 1 is lacking.
[148] 7. - It is not easy to say exactly what is the objection which the
Bulgarian Government claims to draw from the matter of the dispute before
the Court. It would appear, however, that it may be summed up as follows :
the right which the Belgian Government denies to the Bulgarian Government
is, in reality, the right of Bulgarian courts to try disputes between a
Belgian [p95] company that is a concessionaire of public undertakings in
Bulgaria, and a Bulgarian Municipality; now this right is inherent in the
sovereignty of the State and falls within Bulgaria's exclusive jurisdiction,
and the Belgian Government cannot invoke the Treaty of 1931 in order to come
before the Court.
[149] If that really is the Bulgarian Government's objection, it seems to me
certain that it is not a preliminary objection against the Court's
jurisdiction, but a defence on the merits. A preliminary objection is an
objection of which the purpose and the effect are to prevent the continuance
of proceedings before the Court, without prejudging the question whether the
right claimed by the Applicant exists or not. Now it is clear that if the
Court gave a decision on the Bulgarian objection, it would in reality be
admitting or denying the right claimed by Bulgaria, without having heard the
merits.
[150] This objection cannot therefore be upheld, for it is not of the nature
of a preliminary objection. It is hardly necessary to add that the Bulgarian
Government is quite free to put forward its argument during proceedings on
the merits.
[151] 8. - The Bulgarian Government's second complaint is based upon Article
3 of the Treaty, which says : "In the case of a dispute the occasion of
which, according to the municipal law of one of the High Contracting
Parties, falls within the competence of its judicial or administrative
authorities, the Party in question may object to the matter in dispute being
submitted for settlement by the different methods laid down in the present
Treaty until a decision with final effect has been pronounced within a
reasonable time by the competent authority." It has already been said that
this complaint is directed against both the first and the second of the
Belgian Government's claims. It should, however, be examined separately in
respect of each.
[152] A. It is agreed between the Parties that, at the time when the
Application was submitted, the Tribunal of first instance and the Sofia
Court of Appeal had already adjudicated upon the claims of the Sofia
Municipality and the Belgian Company, but that the Court of Cassation with
which the Company had lodged an appeal on June 23rd, 1937, did not deliver
its judgment until March 16th, 1938 - that is, after the filing of the
Application. The Belgian Government does not deny that the judgment was
pronounced within a reasonable time.
[153] The Parties agree that the dispute between the Municipality of Sofia
and the Belgian Company, which forms the subject of the present dispute
between Belgium and Bulgaria, falls within the competence of the Bulgarian
authorities.
[154] The Belgian Government does not claim that the Bulgarian Government
did not comply with Article 3 of the Treaty in [p96] objecting to the
dispute being submitted to the Court. It alleges, however, either that the
condition laid down in Article 3 was already fulfilled on January 26th, 1938
; or that, following denunciation of the Treaty by Bulgaria, Belgium was not
obliged to await its fulfilment ; or, finally, that, since the effect of the
condition is purely suspensory, it cannot be invoked now that the Court of
Cassation has given a decision with final effect.
[155] In my opinion none of these arguments holds.
[156] (a) The contention that the condition required by Article 3 of the
Treaty was already fulfilled on January 26th, 1938, was upheld, if I
remember rightly, from two points of view. Firstly, it was argued that the
matter needed only to have been submitted to the highest national court; it
was not necessary that that court should have delivered judgment. Secondly,
and with greater force, it was urged that, since the appeal to the Court of
Cassation was a remedy of an exceptional nature, it could not prevent the
judgment of the Court of Appeal being regarded as the decision with final
effect within the meaning of Article 3 of the Treaty.
[157] As regards the first point, irrespective of whether there may be cases
in which the rule of international law commonly known as the "local redress
rule" is complied with by the mere submission of a case to the highest
jurisdiction in the land, I do not see how this plea could be accepted in
the face of a treaty text which requires a "decision with final effect".
Either the judgment given by the Court of Appeal is such a decision, or the
existence of such decision must be awaited. The mere fact of having applied
to the supreme jurisdiction does not here carry any weight.
[158] Indeed, the representatives of the Belgian Government relied mainly
upon the alleged finality of judgments given by the Court of Appeal.
[159] The question depends, firstly, upon the meaning that is to be attached
to the words "decision with final effect" in Article 3 of the Treaty and,
secondly, upon the force and effects of judgments given by the Court of
Appeal under the municipal law of the country in which those judgments are
given. The first matter is a question of treaty interpretation and thus of
international law ; the second a question of Bulgarian law.
[160] In order to determine the meaning of the words "decision with final
effect", we have to ascertain what the Parties had in view when they laid
down the stipulations of Article 3 of the Treaty. In my opinion they wanted
to enable the interested State to prevent an international dispute from
arising as long as there was a means of removing its cause through a
decision by the national authorities. It follows that no "decision with
final effect", as required by Article 3, has been [p97] given until the
adopted decision can no longer be altered, at any rate so far as concerns
the matters capable of leading to an international dispute. A decision which
can be amended, cancelled, or replaced by another is not the decision
contemplated by the Parties, whatever colour may be given to it by the
municipal law of the country in which it was issued.
[161] It is agreed that, under Bulgarian law as under the law of several
other countries, for as long as there is the possibility of an appeal to the
Court of Cassation or as long as such appeal is pending, a judgment by an
appeal court is one that can be cancelled and replaced by another judgment
which, in fact as well as in law, may be absolutely different. Should the
Court of Cassation quash the judgment appealed against, the whole case
reverts absolutely to the condition in which it stood immediately after the
judgment by the lower court; a new case on appeal is heard, involving a
re-examination of the facts and of the law, ending in a judgment that may be
altogether different from the previous one.
[162] In view of these circumstances, I really do not see what importance
can be ascribed, either to the exceptional character given by Bulgarian and
other law to the appeal to a court of cassation, for reasons and from
considerations which have nothing to do with the question before us; or to
the fact that, for similar considerations, the sentence by the Court of
Appeal is described as final or given by the last instance; or again, to the
fact that the Court of Cassation pronounces only upon questions of law,
etc., etc. The one important point is that the judgment by the Court of
Appeal, from which appeal is lodged with the Court of Cassation, is a
judgment which may be cancelled and replaced by another quite different
judgment ; that is exactly the contrary of what the Parties desired when
they required a "decision with final effect".
[163] (b) The second argument, namely, that the denunciation of the Treaty
by the Bulgarian Government released the Belgian Government from the duty of
awaiting the result of the recourse to cassation, is based mainly upon the
consideration that, since the Treaty was about to expire, it became
impossible to submit the Application.
[164] This argument seems to me no better founded than the first argument.
If the Bulgarian Government had the right to denounce the Treaty, it was
perfectly natural that the Belgian Government should be rendered incapable
of benefiting by it. It is impossible to describe as force majeure what was
really only a consequence of the exercise by the Bulgarian Government of its
right of denunciation.
[165] True, the representatives of the Belgian Government alluded cautiously
to an abuse of right said to have been committed [p98] by the Bulgarian
Government when it denounced the Treaty in order to remove from the
jurisdiction of this Court the case which the Belgian Government was
proposing to submit.
[166] The theory of abuse of right is an extremely delicate one, and I
should hesitate long before applying it to such a question as the compulsory
jurisdiction of the Court. The old rule, a rule in such complete harmony
with the spirit of international law, Qui iure suo utitur neminem I�dit,
would seem peculiarly applicable. The Bulgarian Government was entitled to
denounce the Treaty and was sole judge of the expediency or necessity of
doing so.
[167] The situation might be somewhat different if the Bulgarian Government,
being free to denounce the Treaty at any time, had chosen the particular
moment at which it had been informed of the Belgian Government's intention
to apply to the Court. But that is not the case. At the time when it learnt
of the Belgian Government's decision, the Bulgarian Government had only a
few days in which to denounce the Treaty under Article 37, Nos. 2 and 3, if
it did not wish to be bound for a further period of five years.
[168] Finally, the Treaty once expired, the Belgian Government was still
able to apply to the Court under the Declarations. And the Belgian
Government, by basing its application not only on the Treaty but also on the
Declarations, showed its belief that those Declarations empower the Court to
adjudicate on the present question. There was therefore no periculum in
mora.
[169] (c) There remains only the argument that the local redress rule, being
of a suspensory character, can no longer be invoked now that the Court of
Cassation has delivered its judgment.
[170] I do not deny that the so-called local redress rule, when invoked by
one of the parties to a case, may on occasions simply serve to suspend
proceedings ; this will probably be the case if the rule is invoked as an
objection to the merits.
[171] But in this case, the Court is not confronted with a rule of common
international law; it is dealing with a specific and formal provision,
Article 3 of the Treaty, which it is required to apply. And this Article
grants to the interested Party the right to "object to the matter in dispute
being submitted" to the Court. It is therefore absolutely certain that we
are concerned with a condition governing application to the Court and that
the condition has to be fulfilled at the time when the Court is applied to.
[172] The objection by the Bulgarian Government is therefore well-founded in
respect of the first claim of the Application. [p99]
[173] B. On the other hand, the objection appears to me to be ill-founded in
respect of the second claim in the Application, viz., the promulgation of
the law of February 3rd, 1936, imposing a special tax on the distribution of
electric power purchased from concerns not subject to the tax.
[174] In reply to the Belgian Government's objection that there is no remedy
against the acts of the legislative authority, the representatives of the
Bulgarian Government merely declared that there is such remedy against the
application of the law.
[175] Making every reservation as to whether the mere promulgation of a law
like the Bulgarian law of February 3rd, 1936, can constitute a breach of
international obligations as claimed by Belgium, there is no denying that
the Application refers to the promulgation of the law, and to its
promulgation only. It is certain, however, that Bulgarian law, like the laws
of nearly all, if not all, countries, knows of no remedy against
promulgations of a law. Article 3 of the Treaty does not therefore apply.
[176] 9. - The third complaint of the Bulgarian Government is based on
Article 1 of the Treaty, according to which only disputes "which it has not
been possible to settle by diplomatic means" shall be submitted for
settlement by the different methods laid down in the Treaty.
[177] The Bulgarian Government admits that, in regard to the points forming
the subject of. the Application's first claim (submission A (1) and (2)),
there were diplomatic negotiations and that they led to no result ; this
complaint therefore does not concern the said claim.
[178] With regard to the second claim (submission A (3)), the Bulgarian
Government declared in its Memorial that the claim relating to the text
established by the law of 1936 was an entirely fresh one and that no attempt
had ever been made to settle it by the diplomatic means referred to in
Article 1 of the Treaty.
[179] The Belgian Government's Supplementary Memorial appears to admit that
there were no diplomatic negotiations on this point. It merely replies that,
according to the Court's jurisprudence, the Belgian Government needed only
to determine, after the failure of its representations made in regard to the
decisions given by the Bulgarian courts, that it was useless to enter into
special negotiations regarding the complaint based on the fiscal law of
1936, a complaint notified to it by the Company "subsequently".
[180] At this point, therefore, it could be taken as established that the
Belgian Government's second claim had not formed the subject of diplomatic
negotiations.
[181] During the oral proceedings the Belgian Government's Agent reverted to
this point and said that, in the course of the many [p100] diplomatic
representations made by his Government, these secondary grounds of complaint
had also been mentioned, and he offered to produce evidence of this fact if
the Court thought it desirable.
[182] In view of the summary character of the procedure mentioned in Article
62 of the Rules and the formal provisions contained in Nos. 2 and 3 of that
Article with regard to evidence, I doubt very much indeed whether the Court
could have accepted the offer made in the circumstances referred to above by
the Agent for the Belgian Government. In any event I can only state that the
evidence was not furnished and that the Belgian Government's claim does not
fulfil the condition required by Article 1 of the Treaty.
[183] 10. - My opinion may be summarized as follows.
[184] The entry into force of the Belgo-Bulgarian Treaty of June 23rd, 1931,
suspended for the whole term of the Treaty, namely, from February 4th, 1933,
until February 4th, 1938, the applicability of the Agreement resulting from
the Belgian and Bulgarian Declarations accepting the Court's compulsory
jurisdiction in accordance with Article 36 of its Statute.
[185] At the time when the Belgian Government filed its Application, the
Treaty was still in force. It follows that the Application was required to
fulfil the conditions laid down in the Treaty and that it is on that basis
that we have to appraise the justice of the preliminary objection to
jurisdiction lodged by the Bulgarian Government.
[186] In as much as that Government pleads that the first claim of the
Belgian Government (submission A (1) and (2)) does not fulfil the condition
laid down in Article 3 and that the second claim (submission A (3)) does not
fulfil the condition laid down in Article 1 of the Treaty, the objection is
well-founded. The Court should have accepted it and disclaimed jurisdiction.
[187] I need scarcely add that the Belgian Government could have submitted a
fresh application based this time upon the Belgian and Bulgarian
Declarations accepting the Court's compulsory jurisdiction, Declarations
that became again applicable in relations between the two States from
February 4th, 1938, onwards.
(Signed) D. Anzilotti. [p101]
Dissenting Opinion by M. Urrutia.
[Translation]
[188] The Application of the Belgian Government against the Bulgarian State
in regard to the Electricity Company of Sofia and Bulgaria declares that
that Government, for the purposes of proceedings before the Court, relied
upon:
(1) the declarations of adherence made by Belgium and Bulgaria to the
optional clause accepting as compulsory the jurisdiction of the Court, which
declarations were respectively ratified on March 10th, 1926, and August
12th, 1921 ;
(2) the Treaty of conciliation, arbitration and judicial settlement
concluded between the two countries on June 23rd, 1931.
[189] In the Statement of the Law contained in the Belgian Memorial (p. 18),
the Court's jurisdiction was derived in the first place from Article 4 of
the said Treaty of conciliation, arbitration and judicial settlement, but
the Memorial added: "In addition, if a further source were necessary, the
Belgian Government bases the jurisdiction of the Permanent Court of
International Justice upon the declarations by which Belgium and Bulgaria
adhered to the optional clause of the Statute of the Court", etc.
[190] In the Statement of Facts in the same Memorial (p. 17), reference is
made to the note sent by the Belgian Minister in Sofia to the Bulgarian
Minister for Foreign Affairs on June 24th, 1937 (Annex 56 of the Belgian
Memorial), in which the Belgian Minister notified the intention of his
Government to submit the dispute to the Court, "the present dispute falling
within the class of those which Articles 4 and 6 of the Treaty of
conciliation concluded between Bulgaria and Belgium on June 23rd, 1931,
permit to be submitted unilaterally to the Permanent Court of International
Justice", etc.; in brackets these words are added : "(whose compulsory
jurisdiction Bulgaria moreover accepted under the optional clause on August
27th, 1921)".
[191] The Belgian Government's Additional Memorial states that the Treaty of
conciliation, arbitration and judicial settlement is, in the second place,
the basis of the Court's jurisdiction. The Statement of Law in the Memorial
of the Bulgarian Government introducing its preliminary objection implies
that the Bulgarian Government also understood the Belgian Application in
this sense.
[192] It would appear that the first question to be asked in order that the
Court may establish its jurisdiction is whether the Bulgarian Government's
objection is to be settled on the basis [p102] of the Treaty already several
times mentioned or on that of the optional clause or on the two texts
conjointly.
[193] Me. Rolin, Counsel for the Belgian Government, speaking in Court in
the morning of March 1st, 1939, expressed his views on this question and
concluded as follows :
"Until February 3rd, 1933, our relations were governed by the optional
clause, subject to the conditions specified in our respective declarations
of acceptance.
From February 3rd, 1933 - the date of the coming into force of the Treaty of
1931 - till February 3rd, 1938, our relations were governed by that Treaty.
From February 3rd, 1938, up to the present time, our relations are again
governed by the optional clause."
"It seems rather strange that, after the written proceedings and after the
arguments which you have heard, you should be invited to decide as to your
jurisdiction in a single dispute between two States on the basis of two
series of documents which have been examined in succession, just as if there
were two clauses in force during the said period between Belgium and
Bulgaria having to be applied in a separate manner, two documents unrelated
to one another, two systems of rules to which you are invited to refer in
succession.... It seems to me preposterous to suppose that it was the
intention of Belgium and Bulgaria to create another additional system which
would be in force during the same period as the optional clause that already
bound us, and would have cumulative effect."
[194] At the afternoon hearing of the same day, Me. Rolin modified his
earlier opinion and expressed another view to the effect that "in this
second intermediate period - during which Belgium filed her Application -
the Court should take into consideration the optional clause together with
any amendments to it effected by the Treaty between Belgium and Bulgaria"
(Expos�s oraux, Distr. 4225).
[195] M. Altinoff, Agent for the Bulgarian Government, disputed the
arguments adduced by Me. Rolin in his first statement and,, according to the
Bulgarian Agent, the Treaty of arbitration, conciliation, etc., between
Belgium and Bulgaria makes no change so far as concerns judicial settlement
and leaves the previous situation wholly intact.
[196] In order to decide this question, the Court is not obliged to adopt
the legal ground taken up by either Party, but is quite free to reach a
decision in accordance with its own judgment, even if both Parties defend
the same legal argument, should the Court consider that that argument lacks
foundation.
[197] It is not only the right, but the duty of the Court ex officio to make
sure of its jurisdiction, that is of its power to take [p103] cognizance of
a case in accordance with the texts governing the said jurisdiction (Art. 53
of the Statute).
***
[198] Bulgaria's declaration accepting the jurisdiction of the Court under
Article 36 of the Court's Statute was signed on July 29th, 1921; it was
ratified on August 12th, 1921, and contains no reservation, but only the
general condition of reciprocity.
[199] The declaration by Belgium is limited to fifteen years in any disputes
arising after the ratification with regard to situations or facts subsequent
to this ratification, except in cases where the Parties have agreed or shall
agree to have recourse to another method of pacific settlement.
[200] The Belgian declaration was ratified on March 10th, 1926, which date
fixes the entry into force as between Belgium and Bulgaria of the aforesaid
declarations, under the reciprocity clause.
[201] The Treaty of conciliation, arbitration and judicial settlement signed
between Bulgaria and Belgium on June 23rd, 1931, was ratified on February
4th, 1933. It was denounced on August 3rd, 1937, and expired on February
4th, 1938, in accordance with Article 37.
[202] The adherence of the two Parties to Article 36 of the Statute of the
Court is equivalent in law to an international agreement between them within
the limits fixed by the reservations in the Belgian declaration. The
undertaking could be modified either by extending or restricting the
obligations, or by supplementary provisions embodied in some later
agreement.
[203] The said Treaty between Belgium and Bulgaria defined and amplified the
mutual undertakings following from their acceptance of Article 36 of the
Court's Statute through the introduction of fresh provisions for judicial
settlement, through the creation of a supplementary legal system in relation
with the said settlement.
[204] The reservation ratione temporis contained in the Belgian declaration
cannot be invoked during the current period of the 1931 Treaty. It is surely
out of the question to apply simultaneously, in the same dispute and by the
same court, one treaty stipulation excluding certain disputes from judicial
settlement, and another stipulation providing for them. One stipulation or
the other must prevail. In the present case it is the Treaty, which is a
later law between the Parties, a special law, the text of which is so
perfectly clear that there can be no choice of construction, still less any
confusion.
[205] Under Article 3 of the said Treaty, the High Contracting Parties
agreed to establish certain special conditions before [p104] an application
could be submitted, to the Court. This Article, which is Article 31 in the
General Act of conciliation, arbitration and judicial settlement adopted by
the Assembly of the League of Nations on September 26th, 1928, laid down an
express condition governing an appeal to the compulsory jurisdiction of the
Court as accepted in the declarations relating to that jurisdiction in
accordance with Article 36 of the Statute. That condition, which appears in
one form or another in the many treaties which followed the General Act,
means that the High Contracting Parties, by a solemn and positive act,
accept that principle of international law concerning exhaustion of internal
remedies, a principle already generally acknowledged as one of those to
which paragraph 3 of Article 38 of the Court's Statute refers, and which the
Court recently confirmed, so happily in its recent judgment in the case of
the Panevezys-Saldutiskis Railway between Estonia and Lithuania.
[206] The application of the ordinary rule of international law concerning
exhaustion of local remedies, which in my opinion, is binding in connection
with the introduction of any application whatever to the Court under the
optional clause, is in. the present case altogether inevitable, arising as
it does out of the express stipulation of a treaty. Article 38 of the
Court's. Statute mentions as the first of the sources of law to be applied
:: international conventions establishing rules expressly recognized-by the
contesting States.
[207] Accordingly, for as long as the 1931 Treaty was in force, Article 3 is
the Article which must govern the jurisdiction of the Court in the case of
an application filed by one of the High Contracting Parties. If the Parties,
by merely invoking the acceptance of the Court's jurisdiction contained in
their declarations of adherence, could set aside this fundamental clause in
the Treaty, the latter would have a purely academic value and no practical
efficacy whatever.
[208] Article 7 of the 1931 Treaty also inserted a new and additional clause
connected with the judicial settlement of any dispute between the High
Contracting Parties. It was provided that, if conciliation failed, a certain
time must elapse before an application could be submitted to the Court.
[209] Articles 33 and 34 of the Treaty contain further provisions concerning
judicial settlement.
[210] The Treaty established a whole legal system supplementing and
determining the exercise of the Court's compulsory jurisdiction as accepted
by the Parties. The latter did not forget their declarations of adherence,
and Article 4 of the Treaty expressly provides that the disputes to which it
refers include [p105] in particular those mentioned in Article 36 of the
Statute of the Permanent Court of International Justice. Article 31 of the
Treaty also refers to the rules in regard to the substance of the dispute
indicated in Article 38 of the Statute. It may therefore be concluded that
the Parties intended to incorporate the general system of law arising out of
the acceptance of the Court's compulsory jurisdiction within another system
more precise and more comprehensive and which the Parties no doubt thought
best adapted to their mutual interests.
[211] The Treaty cannot be said to have cancelled, abrogated or suspended
the legal effects of the declarations, but it made them subject to such
conditions that, during the term of the Treaty, the Court's jurisdiction may
only be exercised in accordance with those conditions.
[212] If it were to be allowed that two provisions, governing the
jurisdiction of the Court in a different and even a contrary manner, were
simultaneously applicable, it would follow that the Court can possess
jurisdiction in a certain case under one of these provisions, while
possessing no jurisdiction under another. Such a situation seems to me
hardly permissible from the legal point of view, nor, I think, would it
accord with the Wish of the Parties as expressed in the text of the
instruments by which they are bound.
[213] If it is inadmissible under municipal law that the jurisdiction of the
Court should be governed by one law which establishes its jurisdiction and
by another law which excludes it, it is equally impossible to contemplate a
parallel situation in international law.
***
[214] Adherence to Article 36 of the Court's Statute by several States,
provided for in that Article, was a long step towards what is called
compulsory arbitration. This provision to some extent realized the hopes of
several countries which wished the compulsory jurisdiction of the Court to
be incorporated within the Statute itself. It was decided, however, that
this general system was to be supplemented and completed by multilateral or
bilateral agreements exactly defining the obligations of the parties. It was
this purpose which inspired the recommendations of the Assembly of the
League of Nations adopted on October 2nd, 1924, and September 25th, 1926,
and, finally, the drafts of the General Act of conciliation, arbitration and
judicial settlement and of the model conventions annexed thereto, voted by
the Assembly of 1928.
[215] The question raised in the case now before the Court involves a legal
problem of great importance to the proper understanding [p106] of the
relations existing between the optional clause and the said conventions, and
the Court's decision will certainly be very carefully examined by all the
signatory States.
***
[216] On January 25th, 1938, the day on which the Belgian Application was
filed with the Court, the Treaty of 1931 was still in force, and the
provisions of that Treaty concerning judicial methods must determine the
jurisdiction of the Court in this case.
[217] In my opinion, Belgium could not submit her Application, for as long
as the said treaty was in force, without taking account of its provisions.
[218] Bulgaria, too, in her preliminary objection, was bound to discuss the
jurisdiction of the Court in the light of the treaty provisions.
[219] The Bulgarian Government bases its objection to the jurisdiction of
the Court on Article 3 of the said Treaty. The Belgian Government, both in
its written memorials and in its oral pleadings, accepted the Bulgarian
Government's objection as an objection to the jurisdiction of the Court,
which it in fact is, since the said jurisdiction emanates from the text of
the Treaty.
[220] The above-mentioned Article 3 lays down the following conditions in
order that one of the Parties may object to the submission of an application
to the Court:
1. If the dispute is one the occasion of which, according to the municipal
law of one of the High Contracting Parties, falls within the competence of
the judicial or administrative authorities of the objecting Party.
2. If the dispute has not been settled by means of a decision with final
effect pronounced within a reasonable time by the competent authority.
3. If the applicant Party has not notified the other Party of its intention
within a period of one year from the date of the aforementioned decision.
[221] The present dispute appears to me to fall within the competence of the
Bulgarian judicial authorities for the following reasons.
[222] The Belgian Government recognized the jurisdiction of the Bulgarian
courts in the Belgian Minister's letter to the Bulgarian Prime Minister
dated April 22nd, 1937 (Bulgarian Memorial, No. 37).
[223] The Electricity Company of Sofia also recognized that jurisdiction, as
is confirmed by the Belgian Minister in the afore [p107] said note, and also
by the very fact of having instituted proceedings before the courts.
[224] The Agent for the Belgian Government acknowledged that jurisdiction
both in the written memorials and in the oral pleadings. The Belgian
Government's Additional Memorial contains this important statement :
"Moreover, far from the Belgian Government having claimed to withdraw from
the examination of the Bulgarian courts a dispute which fell legally within
their jurisdiction, it is a fact that at the time when the Application was
filed, two Bulgarian instances had delivered final judgments."
[225] According to universally admitted rules of international law,
"property rights and contractual rights depend .... on municipal law ....
and fall therefore more particularly within the jurisdiction of municipal
tribunals". That is a quotation from the Court's last judgment
(Panevezys-Saldutiskis Railway).
[226] The Court also laid down in that judgment that the question whether
the courts of a country do or do not possess jurisdiction in a given case
depends upon the law of that country and that on that matter only the said
courts can give a final decision.
[227] There is no need to enter into the merits of this dispute in order to
appreciate what is already evident, namely that the rights in question are
contractual rights between the Municipality of Sofia and a Belgian
electricity company.
[228] I also consider that Belgium filed her Application before the
Bulgarian courts had delivered a final judgment, for these reasons.
[229] The judgment by the Court of Cassation might have quashed the judgment
of the Court of Appeal and have referred the case for re-examination by two
new courts.
[230] The Sofia Electricity Company lodged an appeal with the Court of
Cassation for the very purpose of securing a fresh examination of the
dispute by the Bulgarian courts.
[231] The Belgian Government's Memorial itself admits by implication that
this appeal to the Court of Cassation was its last remedy (pp. 20 and 36 of
the Belgian Memorial). The Belgian Memorial concludes as follows :
�May it please the Court, subject to any fuller submissions that may be made
in the course of the proceedings,
A. To declare that the State of Bulgaria has failed in its international
obligations,
1. �.
2. By reason of the above-mentioned judgments of the District Court and of
the Court of Appeal of Sofia and of the judgment of the Court of Cassation
given on March 16th, 1938...�. [p108]
[232] The argument whereby an appeal to a court of cassation does not
prevent the application pf the local redress rule would, have as its result
that the same dispute might be dealt with simultaneously by a municipal
tribunal and an international court.
[233] As regards reasonable time-limits for the delivery of the final
judgment by the national courts, the Belgian Government has made no
observations and could not do so in its Application, because at the time
when it was filed it was still not known when the Court of Cassation would
deliver its judgment. For the rest, that judgment was given within less than
nine months.
[234] The second part of Article 3 of the Treaty contains an undertaking by
the State which proposes to submit an application to notify its intention
within one year from the date of the above-mentioned decision. As there had
been no decision with final effect, there could be no such notification. The
notification contained in the note by the Belgian Legation in Sofia
addressed to the Bulgarian Prime Minister and Minister for Foreign Affairs
on June 24th, 1937, refers to the judgment delivered by the Sofia Court of
Appeal on March 27th, 1937.
[235] With regard to paragraph 4 of Article 37 of the Treaty, I think that
the words "proceedings pending at the expiration of the current period of
the Treaty shall be duly completed" refer to proceedings validly instituted,
that is to say that paragraph 4 of Article 37 refers to proceedings
instituted in conformity with Article 3.
***
[236] The above considerations have led me to conclude that the preliminary
objection to the Court's jurisdiction lodged by the Bulgarian Government and
based on the Treaty of conciliation, arbitration and judicial settlement,
concluded between Belgium and Bulgaria on June 23rd, 1931, is well-founded.
(Signed) Urrutia. [p109]
Dissenting Opinion by Jonkheer Van Eysinga.
[Translation]
[237] The Belgian Application relies on the Bulgarian and Belgian
declarations of July 29th, 1921, and September 25th, 1925, accepting the
jurisdiction of the Court under Article 36 of the Statute and also on the
Treaty of conciliation, arbitration and judicial settlement of June 23rd,
1931.
[238] The adduction of these two sources of jurisdiction confronts the Court
with the problem of concurrent sources of jurisdiction, a problem which
became of practical importance more especially when the jurisdiction of the
Court under Article 36 of the Statute was added to that of other tribunals
provided for in already existing treaties. The importance of the problem was
pointed out when the Court first entered upon its duties at the beginning of
1922 by van Vollenhoven in an article published in that year in the
Rechtsgeleerd Magazijn and reproduced in the second volume of his Verspreide
Geschriften (1934, pp. 559 et sqq.). Afterwards, the problem was further
complicated by the conclusion of treaties of judicial settlement subsequent
to acceptance of the Court's jurisdiction under Article 36 of the Statute
and by the General Act of Geneva of September 26th, 1928. In these
circumstances it is understandable that the problem should have attracted
the attention of several other writers.
[239] In the present case it will suffice to examine the question what is
the precise relation, as regards the Court's jurisdiction, between the
Bulgarian and Belgian declarations under Article 36 of the Statute on the
one hand, and the Treaty of 1931 on the other.
[240] As the question here concerns the foundation of the jurisdiction of
the Court, it is for the latter to form its own opinion on the subject.
[241] The legal link resulting from acceptance of the Court's compulsory
jurisdiction under Article 36 of the Statute came into existence on March
10th, 1926, when the Belgian declaration, which was some years later than
the Bulgarian, came into force. By the operation of reciprocity, the only
condition made in the Bulgarian declaration, the two conditions ratione
temporis made in the Belgian declaration - the dispute must arise after
March 10th, 1926, and in regard to situations or facts subsequent to that
date - also hold good for Bulgaria. The same applies as regards the final
condition made in the Belgian declaration : "except in cases where the
Parties have agreed or shall agree to have recourse to another method of
pacific settlement". [p110]
[242] After the changes in the system of pacific settlement of international
disputes brought about by the activity of the League of Nations and
particularly by the General Act of Geneva and the draft bilateral treaties
attached to that Act, Bulgaria and Belgium made another effort with a view
to the pacific settlement of any disputes between them by signing the Treaty
of 1931 which came into force on February 4th, 1933. This Treaty in fact
involves a very considerable extension of that which was provided for by the
Belgian and Bulgarian declarations under Article 36 of the Court's Statute.
[243] Whereas the Bulgarian and Belgian declarations had in view the future
legal disputes mentioned in Article 36 of the Statute, the Treaty of 1931
covers "All [future] disputes with regard to which the Parties are in
conflict as to their respective rights" (Art. 4, para, 1), a conception
which, according to paragraph 2 of this Article, covers more than the legal
disputes mentioned in Article 36 of the Statute. And whereas the Belgian and
Bulgarian declarations provided only for recourse to the Court, the Treaty
of 1931 is more elastic and provides in Articles 5 to 7 three other methods
for the pacific settlement of justiciable disputes: conciliation followed by
arbitration, arbitration alone, and conciliation followed by a judicial
settlement, while only if one of these three methods were not adopted would
the Court alone decide the dispute.
[244] Moreover, the Treaty of 1931 is not restricted to the pacific
settlement of legal disputes in the broad sense indicated in Article 4. The
Treaty also provides for the pacific solution of "[future] disputes of every
kind which may arise between the High Contracting Parties". In so far as
such disputes are non-justiciable, they are all, without exception, to be
referred to conciliation (Arts. 8-23) and if need be to arbitration (Arts.
24-31).
[245] The condition made in the Belgian declaration that a future dispute
must arise "in regard to situations or facts subsequent to ratification of
the declaration" has disappeared in the Treaty of 1931 ; on the other hand,
recourse to diplomacy (Art. 1) and to the national administrative or
judicial authorities (Art. 3) must be exhausted before the Parties can
appeal to one of the procedures provided for in the Treaty; the two last
conditions, which are new, are perfectly intelligible having regard to the
very great extension of the system of pacific settlement of international
disputes represented by the Treaty of 1931.
[246] It would seem already to follow, from the foregoing comparison between
the Bulgarian and Belgian declarations and the articles of the Treaty of
1931, that the two countries, in concluding the Treaty, intended to develop
very considerably the system for the pacific settlement of any disputes
between them. And, with regard more particularly to justiciable disputes,
the [p111] two countries not only extended the scope of this category of
disputes but also modified the method for their pacific settlement.
[247] The new scope imparted by the two countries to the pacific settlement
of any disputes between them is also apparent from the preamble to their
Treaty of 1931. In this preamble, the two High Contracting Parties refer to
"the recommendation of the Assembly of the League of Nations in its
Resolution of September 26th, 1928, that all States should conclude
conventions for the pacific settlement of international disputes", and they
consider "that the faithful observance, under the auspices of the League of
Nations, of methods of pacific settlement renders possible the settlement of
all international disputes". It seems difficult to imagine that two States
who, animated by this spirit, conclude a new agreement which carries much
further the development of the system for the settlement of their disputes,
should not have intended to apply the new agreement and the new agreement
only so long as it remained in force.
[248] Moreover, the Belgian declaration of September 25th, 1925, which, as
has been stated, also holds good for Bulgaria, explicitly provides for such
a situation when it concludes with the words: "except in cases where the
Parties have agreed or shall agree to have recourse to another method of
pacific settlement". It follows from this conclusion of the Belgian
declaration that that declaration is intended to be subsidiary; it is not to
apply when and in so far as another method of pacific settlement has been
established, and as has been explained above, the Treaty of 1931 does in
fact establish another method of pacific settlement for the legal disputes
contemplated by the Bulgarian and Belgian declarations.
[249] One is struck by the lack of consistency in the manner in which the
problem of the simultaneous existence of different sources of the Court's
jurisdiction has been envisaged on the Belgian side in this case.
[250] The letter of the Belgian Minister in Sofia of June 24th, 1937, in
which it is proposed by Belgium that the dispute should be settled by the
International Court, is based only on the Treaty of 1931. The letter only
refers in parenthesis to the Bulgarian declaration of 1921 and not to the
Belgian declaration which it would have been necessary to do - and not in
parenthesis - if the Belgian Government had intended to found its proposal
on the two declarations.
[251] On the other hand, the Belgian Application adduces both the
declarations under Article 36 of the Statute and the Treaty of 1931. Both
Belgium and Bulgaria proceed with their arguments on these lines but without
clearly stating the problem of the concurrent sources of jurisdiction. The
calm was broken when Counsel for the Belgian Government, on the morning of
[p112] March 1st, said that the Treaty of 1931 alone should be applied
during the period of its existence (Feb. 4th, 1933, to Feb. 4th, 1938) and
that only before and after that period were the Bulgarian and Belgian
declarations applicable - in other words, he reverted to the precise
attitude of the Belgian letter of June 24th, 1937. In the afternoon the
Belgian Counsel felt obliged to revert to the standpoint of the Belgian
Application which, finally, was vigorously supported, without however
convincing me, in the Bulgarian Agent's oral reply. It is however just
possible that there may be a shade of difference between the standpoint of
the Belgian Counsel and that of the Bulgarian Agent.
[252] This inconsistency in the Belgian attitude with regard to a problem
which is fundamental in the present case is especially surprising because it
has always been the practice of Belgium, in making the declaration of
September 25th, 1925 - which was subsequently adopted by many other
governments - as well as in adhering to the General Act and in signing a
large number of treaties with or without the second condition ratione
temporis (in regard to situations or facts subsequent to ratification) of
the 1925 declaration, to be perfectly plain and precise.
[253] To try to apply at one and the same time two systems the second of
which was adopted precisely in order to modify the first seems a difficult
thing to do and one which must necessarily lead to results which in
themselves show the inconsistency of such an attempt. I will point out one
of these results. The second condition ratione temporis (in regard to
situations or facts subsequent to ratification) of the Belgian declaration
applies with regard to the legal disputes enumerated in Article 36 of the
Statute. If one seeks to apply both the Belgian declaration and the Treaty
of 1931, this condition remains applicable for the legal disputes of Article
36 of the Statute but is not so for the other legal disputes covered by
Article 4 of the Treaty. Is it possible to imagine that the two countries
intended this?
[254] It follows from the foregoing that the jurisdiction of the Court in
this case, which began when the Treaty of 1931 was in force, must be
envisaged solely in the light of that Treaty.
***
[255] The Belgian Application, setting aside point B, asks the Court to
declare that Bulgaria has failed in her international obligations as the
result of three distinct actions on the part of her administrative, judicial
and legislative authorities. Bulgaria denies the alleged failure, and her
chief argument is that the three actions in question fall solely within the
domestic [p113] jurisdiction of Bulgaria and are therefore outside the
jurisdiction of the Court, and the latter is asked by Bulgaria to give
judgment to this effect. Besides this ground for the preliminary objection,
Bulgaria puts forward three other grounds which are all included in her one
objection to the jurisdiction. It is not easy to appreciate the precise
intention of the Bulgarian Memorial which also speaks of the question of
admissibility as well as that of jurisdiction. In this Note the Bulgarian
Memorial is regarded as presenting a single preliminary objection to the
jurisdiction which really consists of four objections, two of which are in
the nature of objections to the admissibility of the Application.
***
[256] In the first place, Bulgaria objects that the Belgo-Bulgarian dispute
has not arisen in regard to situations or facts subsequent to March 10th,
1926, and that consequently the Court has no jurisdiction. Since this
objection is based on the text of the Belgian declaration of September 25th,
1925, and not on the Treaty of 1931, which does not contain this condition
ratione temporis, the Court cannot entertain it.
***
[257] Secondly, Bulgaria - this time on the basis of the Treaty of 1931 -
adduces the non-exhaustion of local remedies, to the exhaustion of which
Article 3 of the Treaty of 1931 subordinates the institution of proceedings.
Here again the Bulgarian Memorial speaks of lack of jurisdiction, since if
the Court accepted the Bulgarian argument, Belgium would not be in a
position to return to the Court on the basis of the Treaty of 1931 which
ceased to be effective on February 4th, 1938. But since Belgium would in
that case be entitled to bring a suit on the basis of the Bulgarian and
Belgian declarations of 1921 and 1925, this is an objection as to the
admissibility of the application and it has been so described more than once
by the Bulgarian representative.
[258] It is common ground that the subject of the dispute between the two
States, in so far as A, Nos. 1 and 2, of the Belgian Application is
concerned, is the same as the subject of the dispute between the Belgian
Company and the Municipality of Sofia, and that, accordingly, Article 3 of
the Treaty of 1931 applies. It is also common ground that on March 27th,
1937, the Bulgarian courts had adjudicated in first instance and on appeal
and that the Bulgarian Prime Minister, on August 3rd, 1937, stated that the
Bulgarian courts had already had occasion to give their decision. But it is
also true that the Belgian [p114] Company on June 23rd, 1937, appealed to
the Court of Cassation and that the Belgian Government's Application was
filed with the Court on January 26th, 1938, that is to say before the Court
of Cassation had adjudicated, which it did on March 16th, 1938, rejecting
the appeal in its entirety.
[259] On behalf of Belgium it has been said that the expression "decision
with final effect" in Article 3 of the Treaty of 1931 does not cover the
exceptional case of an appeal in cassation. In this connection it may
however be asked why the Belgian Company defends its rights so
energetically: for the very reason that it considers them to have been
infringed. And why does the Treaty of 1931, like so many other treaties of
the same kind, stipulate in Article 3 the condition respecting exhaustion of
local remedies? Because the contracting Parties did not intend that an
international court should adjudicate before the municipal courts had had an
opportunity of redressing the alleged breach of the law. In that case it
does not seem to be possible to exclude from these municipal courts the
Court of Cassation whose sole or in any case main task is precisely to
ensure that the law has not been violated.
[260] Accordingly, the final decision of the Bulgarian municipal courts had
not been given when the Belgian Application was filed. It was given some
weeks later, on March 16th, 1938. What would now be the situation if the
Court had upheld the Bulgarian objection as to admissibility ? The Belgian
Government might then at once re-submit its Application on the basis of the
declarations under Article 36 of the Statute, since by then the remedies of
Bulgarian municipal law would have been exhausted more than a year
previously. In these circumstances it seems that it would be a pure
formality to uphold the objection based on the local remedies rule, at a
moment when these remedies have long been exhausted, and on the ground that
at an earlier moment they had not yet been exhausted.
[261] It has been said that nevertheless, as long ago as August 3rd, 1937,
the Bulgarian Government opposed the submission of the dispute to the Court
until a final decision had been rendered by the Bulgarian courts. Is that
true? What the letter of the Bulgarian Prime Minister of August 3rd, 1937,
says is that the Bulgarian courts have exclusive jurisdiction. Bulgaria does
not want the Hague Court either before or after the exhaustion of local
remedies. But since Belgium had said that she intended to refer the case to
the Court under the Treaty of 1931, Bulgaria replies by adducing Article 3
of that Treaty -which she immediately afterwards denounced - but she does so
in terms which leave no doubt that she does not oppose the submission of the
case to the Hague Court before the remedies afforded by the local courts
have been exhausted - which indeed [p115] had already given their decision
according to the letter itself -but the submission of the case to the Court
at all. Accordingly, the special agreement proposed by Belgium was out of
the question. That, it seems to me, is the meaning of the Bulgarian letter
of August 3rd, 1937.
[262] It follows from the foregoing that the objection consisting in the
non-exhaustion of local remedies should not be accepted by the Court.
***
[263] Bulgaria objects in the third place that the Belgian Application
cannot be entertained in so far as it asks the Court to say that the State
of Bulgaria has failed in its international obligations by the promulgation
of the law of February 3rd, 1936, of which Article 30, paragraph C,
establishes a special tax on the distribution of electric power purchased
from undertakings not subject to tax.
[264] The law of 1936 remained outside the scope of the disputes upon which
the Court of Cassation adjudicated as the ultimate Bulgarian court of
appeal, and the Belgian Government was informed of the grievance arising out
of this law only after the failure of its intervention in regard to the
decisions rendered by the Bulgarian courts.
[265] The Bulgarian Memorial gives two reasons why the Belgian Application
is, in its contention, inadmissible in so far as concerns the law of 1936.
[266] In the first place this Belgian claim, it is said, never formed the
subject of efforts to reach a settlement through diplomatic channels as
provided in Article 1 of the Treaty of 1931 upon which the Belgian
Government founds the jurisdiction of the Court. On this point the Belgian
attitude is not quite consistent and it is to be supposed that there are
reasons why, on the Belgian side, it was preferred not to produce proof that
diplomatic methods had in fact been exhausted. However that may be, the
Belgian Agent, at the hearing on March 1st, 1939, concluded by saying that
he was in a position to produce proof that diplomatic negotiations had been
unsuccessfully tried. Accordingly the Belgian Agent definitely offered to
produce proof but left the Court to decide whether he should do so or not.
In these circumstances it seems difficult to draw any conclusion detrimental
to Belgium from the non-presentation of the proof offered.
[267] In the second place, according to the Bulgarian Memorial, the Belgian
Company had not had recourse to any local means of redress with regard to
the claim respecting the law of 1936. The Bulgarian Memorial says on this
subject that there was not even a dispute in the legal sense, so that
Belgium did not observe Article 3 of the Treaty of 1931 which requires not
[p116] only that there must be a dispute falling within the competence of
the Bulgarian judicial or administrative authorities but also that there
must be a decision with final effect given by these authorities, in order to
give rise to a dispute between the two States under the Treaty of 1931.
[268] In this connection it should be observed that it has not been
established that there exist any judicial or administrative authorities,
within the meaning of Article 3 of the Treaty of 1931, to which the Belgian
Company could have had recourse with a view to securing the modification of
the law of 1936. Apart from this however the dispute in this case is not one
in which Belgium has taken up the claim of its national against the
Bulgarian authorities, but a dispute in which Belgium directly impugnes a
legislative act of the State of Bulgaria. And, to use terms borrowed from
the Court's jurisprudence, a dispute, a disagreement or a divergence of
opinions on a point of law or of fact - a contradiction or opposition of
legal views or interests - exists as soon as one of the governments
concerned states that the attitude adopted by the other government conflicts
with its own views. (Judgment No. 2 in the Mavrommatis case, p. 11 ;
Judgment No. 6 in the case concerning certain German interests in Upper
Silesia, p. 14.)
[269] It has been said that Bulgaria objects that the Belgian Government's
claim respecting the law of 1936 is inadmissible on the ground that the
claim did not form the subject of a dispute between the Governments and
prior to the filing of the Belgian Application. Apart from the fact that
this question could only have been cleared up if the Belgian Agent had
produced the proof which he had offered regarding the exhaustion of
diplomatic methods, it should be observed that, as appears from what has
already been said, the Bulgarian Government did not raise this objection in
its Memorial. In their oral statements, the Bulgarian Agent and Counsel also
adduced a number of arguments in addition to the two arguments contained in
the Bulgarian Memorial, but it is unnecessary here to dwell on these
additional arguments which include the argument which dominates the whole
attitude taken up by Bulgaria in this case and which will be dealt with at
the end of this Note, namely that legislative acts fall within the exclusive
jurisdiction of Bulgaria. But the argument that there was no dispute between
the two Governments before the filing of the Belgian Application is not to
be found in the additional arguments any more than in the Bulgarian
Memorial. [p117]
***
[270] I now come to the fundamental preliminary objection to the
jurisdiction raised by Bulgaria: namely, that the impugned actions of the
administrative, judicial and legislative authorities all fall within the
exclusive jurisdiction of Bulgaria.
[271] With regard to this aspect of the allegation of lack of jurisdiction,
the following observations are called for.
[272] The subject of the dispute is stated in the Application and consists
in an alleged failure by Bulgaria to fulfil her international obligations.
In the dispute the two Parties are in conflict as to their respective rights
: the alleged failure to fulfil international obligations, on the one hand,
and alleged exclusive jurisdiction, on the other. Accordingly, the dispute
comes under Article 4 of the Treaty of 1931.
[273] Bulgaria recognizes the jurisdiction of the Court to declare that the
impugned actions of the administrative, judicial and legislative authorities
all fall exclusively within the domestic jurisdiction of Bulgaria. She even
insists upon it when she asks the Court to declare that it has no
jurisdiction to entertain the Belgian Application. A decision to the effect
that the actions of the administrative, judicial and legislative authorities
complained of all fall within the domestic jurisdiction of Bulgaria would
require that the Court should undertake the same investigation as that asked
for in the first place by the Belgian Application when it asks the Court to
declare that the State of Bulgaria in consequence of these actions has
failed in her international obligations. For, before it could adjudicate on
the question whether Bulgaria has failed in all or some of her international
obligations contemplated in the Belgian Application, the Court would have to
decide if Bulgaria had any international obligations in relation to the acts
complained of or whether, on the contrary, these acts fall solely within the
domestic jurisdiction of Bulgaria. It follows that an examination of
Bulgaria's fundamental preliminary objection to the jurisdiction would
entail an examination of the merits and that, consequently, this objection
does not possess the nature of a preliminary objection and must be rejected,
though Bulgaria could take it up again as a plea in defence.
***
[274] The foregoing observations point to the rejection of the four
preliminary objections, while at the present stage of the proceedings the
Court is not called upon to adjudicate on paragraph 2 of the Bulgarian
submissions.
(Signed) V. Eysinga. [p118]
Dissenting Opinion of Mr. Hudson.
[275] The Bulgarian Government has advanced a preliminary objection in this
case, asking the Court to declare that it lacks jurisdiction to deal with
the application filed by the Belgian Government on January 26th, 1938, and
to dismiss the Belgian claims. This challenge to the Court's jurisdiction
requires that attention be given, at the outset, to the possible sources of
jurisdiction, and to the bases upon which Belgium asserts and Bulgaria
contests jurisdiction to deal with this case. If two States parties to a
case before the Court agree that the Court has jurisdiction, it will usually
be unnecessary for the Court to look further for confirmation of its
jurisdiction; but where, as here, the jurisdiction is contested, the Court
must look for a source of its jurisdiction in the applicable law in spite of
the fact that the parties may trace their contentions to the same source or
sources.
***
[276] In the diplomatic correspondence which preceded the filing of the
Belgian Application, the Belgian-Bulgarian Treaty of conciliation,
arbitration and judicial settlement of June 23rd, 1931, was put forward by
the Belgian Minister at Sofia as the sole source of the jurisdiction to be
invoked. In a letter addressed to the Bulgarian Minister for Foreign Affairs
on June 24th, 1937, the Belgian Minister proposed the conclusion of a
compromis for submitting the dispute to the Court, stating that it fell
within the class of disputes which the provisions of Articles 4 to 6 of the
Treaty of 1931 permitted to be taken to the Court by unilateral application
unless agreement was reached for submitting them to arbitration; reference
was made parenthetically only to the declaration by which in 1921 Bulgaria
had recognized the obligatory jurisdiction of the Court, but no mention was
made of the declaration by which Belgium had recognized the Court's
obligatory jurisdiction and no indication was given of any desire on the
part of the Belgian Government to avail itself of the reciprocal
declarations of Belgium and Bulgaria. On July 30th, 1937, the Belgian
Minister informed the Bulgarian Minister for Foreign Affairs that as the
Belgian Government saw no possibility of an agreement between the two
Governments for submitting the dispute to arbitration in accordance with the
provisions of the Treaty of 1931, the dispute would be put before the Court
by the [p119] unilateral application of the Belgian Government. In his reply
of August 3rd, 1937, the Minister for Foreign Affairs referred to the
Belgian Government's intention to go before the Court by unilateral
application based on the Treaty of 1931, and he gave notice of the Bulgarian
Government's intention to avail itself of the privilege accorded by Article
3 of that Treaty.
[277] These were the communications exchanged by the Parties prior to the
filing of the Belgian Application. They gave no indication that any source
of the Court's jurisdiction was to be relied upon other than the Treaty of
1931. References by the Parties to the sources of the Court's jurisdiction
may now be traced through the documents of the written proceedings.
[278] The Belgian Application filed with the Registry of the Court on
January 26th, 1938, referred to two sources of jurisdiction:
(1) the declarations of adherence made by Belgium and Bulgaria to the
Optional Clause accepting as compulsory the jurisdiction of the Court, which
declarations were respectively ratified on March 10th, 1926, and August
12th, 1921;
(2) the Treaty of conciliation, arbitration and judicial settlement
concluded between the two countries on June 23rd, 1931.
[279] The Memorial presented by the Belgian Government contained (pp. 18-19)
a section entitled "La comp�tence de la Cour", in which it was said that the
Belgian Government found a justification of the Court's jurisdiction in the
Treaty of 1931, and Articles 4 and 37 of the Treaty were set out in extenso;
the Memorial proceeded to state that surabondamment the Belgian Government
based the Court's jurisdiction on the "declarations of adherence of Belgium
and of Bulgaria to the Optional Clause", but the texts of these declarations
were not set forth. In the additional Memorial subsequently submitted by the
Belgian Government, it was said (p. 9) that the Treaty of 1931 had been
indicated in the Memorial as a basis of jurisdiction en deuxi�me lieu; and
reference was made (p. 15) au fondement de comp�tence de la Cour que
surabondament la Partie demanderesse croit trouver dans le Trail� de 1931.
[280] On its side, the Bulgarian Government expressed the view (Bulgarian
Memorial, p. 8) that the Belgian contentions as to the Court's jurisdiction
were justified neither on the basis of the declarations cited nor on the
basis of the Treaty of 1931.
[281] It was only in the oral proceedings that reference was made to the
relation existing between the Treaty of 1931 and the earlier declarations,
as possible sources of the Court's jurisdiction to deal with this case.
Though the Belgian Agent had contended that chacun de ces deux actes suffit
en r�alit� � lui seul pour �tayer nos revendications, M. Rolin, Counsel for
the Belgian Government, expressed the view (Expos�s oraux, [p120] pp. 49-50)
that it would be absurd to imagine that it had been intended by the Belgian
and the Bulgarian Governments in 1931 to create an additional system to be
in force cumulatively with the Optional Clause by which the two States were
already bound; and that, during the period when it was in force, the Treaty
of 1931 prevailed over the Optional Clause. Hence he concluded that the
legal relations between Belgium and Bulgaria were governed as follows: until
February 3rd, 1933, by the Optional Clause: from February 3rd, 1933 � date
of the entry into force of the Treaty of 1931 [FN1] � to February 3rd, 1938,
by the Treaty; and since February 3rd, 1938, by the Optional Clause. Later
in the course of his expose, however, M. Rolin stated (p. 56) that
reflection had led him to question the correctness of his earlier statement;
with the result that, after reflection, he considered that in the period
during which the Treaty was in force the Court could take the Optional
Clause into consideration dans la mesure o� elle n'est pas modifi�e par les
amendements qu'�ventuellement y a apport�s le Trait� entre la Belgique et la
Bulgarie.
---------------------------------------------------------------------------------------------------------------------
[FN1] The exchange of ratifications of the Treaty of 1931 took place not on
February 3rd, but on February 4th, 1933.
---------------------------------------------------------------------------------------------------------------------
[282] In reply to M. Rolin's statement, the Bulgarian Agent gave (pp. 74-75)
various reasons for the Bulgarian view that the Treaty of 1931 did not
suspend the functioning of the Optional Clause; he contended that, with
respect to the obligation of judicial settlement, the Treaty of 1931 left
intact the pre-existing legal situation, and that the dispositions in the
Treaty concerning judicial settlement served only the purpose of a reference
to the pre-existing situation, without effecting any modification in that
situation.
[283] On this presentation of the problem as to the source or sources of the
Court's jurisdiction, it is necessary to consider in some detail the legal
obligations of Belgium and Bulgaria inter se with reference to the
jurisdiction of the Court, as they existed on January 26th, 1938, the date
when the Belgian Application was filed.
*
[284] On August 12th, 1921, the Bulgarian Government deposited at Geneva a
ratification of a declaration made on July 29th, 1921, in connection with
Bulgaria's signature of the Optional Clause, the text of which was as
follows: [p121]
"On behalf of the Government of the Kingdom of Bulgaria I recognize, in
relation to any other Member or State which accepts the same obligation, the
jurisdiction of the Court as compulsory ipso facto and without any special
convention, unconditionally. "
[285] On September 25th, 1925, the Optional Clause was signed on behalf of
Belgium, with the following declaration:
"On behalf of the Belgian Government, I recognize as compulsory, ipso facto
and without special agreement, in relation to any other Member or State
accepting the same obligation, the jurisdiction of the Court in conformity
with Article 36, paragraph 2, of the Statute of the Court for a period of
fifteen years, in any disputes arising after the ratification of the present
declaration with regard to situations or facts subsequent to this
ratification, except in cases where the Parties have agreed or shall agree
to have recourse to another method of pacific settlement. "
[286] A ratification of the Belgian declaration was deposited at Geneva on
March 10th, 1926. After this date, therefore, Belgium and Bulgaria were
bound inter se to recognize the Court's jurisdiction with respect to the
disputes enumerated in Article 36, paragraph 2, of the Statute, with the two
exceptions established by the Belgian declaration, i. e., excepting (1)
disputes arising before March 10th, 1926, and (2) disputes with regard to
situations or facts prior to March 10th, 1926. The obligation of the two
States was not applicable, however, in cases where the Parties had agreed or
might agree to have recourse to another method of pacific settlement.
*
[287] On June 23rd, 1931, representatives of Belgium and Bulgaria signed a
Treaty of conciliation, arbitration and judicial settlement, so entitled;
ratifications of this Treaty were exchanged on February 4th, 1933 [FN1]. On
that date, in accordance with the provisions in Article 37 (2), the Treaty
entered into force for a period of five years, expiring on February 4th,
1938. On August 3rd, 1938, six months before the expiration of the five-year
period and in accordance with the provisions in Article 37 (3), the Treaty
was "denounced" by Bulgaria; hence it did not continue in force for an
additional period of five years after February 4th, 1938.
---------------------------------------------------------------------------------------------------------------------
[FN1] The Treaty was registered with the Secretariat of the League of
Nations, No. 3156, on March 3rd, 1933. 137 League of Nations Treaty Series,
p. 191.
---------------------------------------------------------------------------------------------------------------------
[288] The Treaty provides (Art. 1) that disputes of every kind which may
arise between the Parties and which it may not have been possible to settle
by diplomacy shall be submitted [p122] to judicial settlement or
arbitration, preceded either obligatorily or optionally by a procedure of
conciliation. Disputes "with regard to which the Parties are in conflict as
to their respective rights" � it is expressly stated that these disputes
include those mentioned in Article 36 of the Court's Statute � are to be
submitted to the Court (Art. 4) unless the Parties agree upon resort to an
arbitral tribunal. Provision is made for the procedure of arbitration of
such disputes if the Parties agree on arbitration, and also for a procedure
of conciliation of such disputes if the Parties agree on conciliation. As to
disputes other than those "with regard to which the Parties are in conflict
as to their respective rights", a procedure of conciliation is made
obligatory (Art. 8), elaborate provision being made for the conduct of this
procedure; and if the conciliation does not lead to an agreement between the
Parties, arbitration then becomes obligatory for these disputes (Art. 24),
provision being made for constituting the arbitral tribunal and for the
procedure to be followed.
[289] Comparing the Treaty of 1931, in so far as it relates to judicial
settlement, with the reciprocal declarations made by Belgium and Bulgaria
under Article 36, paragraph 2, of the Statute, it will be seen that the
Treaty provision for judicial settlement by the Court applies to all the
legal disputes which would be covered by the declarations, and it may go
further in that it applies to all disputes with regard to which the Parties
are in conflict as to their respective rights. The Treaty is also more
extensive in that it does not exclude disputes with regard to situations or
facts anterior to March 10th, 1926. On the other hand, the Treaty contains
two conditions not set by the reciprocal declarations; under Article 1 of
the Treaty, the dispute must be one "which it may not have been possible to
settle by diplomacy"; and under Article 3 of the Treaty, if the dispute is
one of which the subject (Fr. objet) according to the law of one of the
Parties falls within the competence of its judicial or administrative
authorities, that Party may object to the dispute's being submitted for
settlement by a method laid down in the Treaty until a definitive decision
has been pronounced within a reasonable time by the competent authority. One
other difference is to be noted: while the Bulgarian declaration of 1921 was
not limited to any period of time, the Belgian declaration was limited to a
period of fifteen years expiring on March 10th, 1941; the Treaty on the
other hand was concluded for successive five-year periods, and as events
turned out it ceased to be in force at the end of the first period of five
years, i. e., on February 4th, 1938. [p123]
*
[290] This being the situation, the Court must say what law obtained between
Bulgaria and Belgium on January 26th, 1938, the date of the filing of the
Belgian Application. The fact that the Treaty of 1931 ceased to be in force
some nine days later can have no bearing on the Court's jurisdiction with
respect to this case. If the jurisdiction existed on January 26th, 1938, it
will continue until the case is disposed of in due course; this is expressly
recognized, indeed, in Article 37 (4) of the Treaty.
[291] On January 26th, 1938, then, were the provisions of the Treaty of 1931
operative ? Were the reciprocal declarations made by Belgium and Bulgaria
under Article 36, paragraph 2, of the Statute, also operative ? And if the
latter question be answered in the affirmative, do the reciprocal
declarations and the Treaty constitute independent ways of access to the
Court ? Or are their provisions in some way cumulative, so as to require
that the conditions of both must be met before the Court's jurisdiction can
be invoked ? These questions will have to be considered, however, only if
both the reciprocal declarations and the Treaty of 1931 are found to be
applicable, in their terms, to this case.
[292] The jurisdiction conferred on the Court by the Belgian declaration is
in terms not applicable "in cases where the Parties have agreed or shall
agree to have recourse to another method [Fr. mode] of pacific settlement".
The first question is whether this is such a case, whether the Treaty of
1931 constitutes, for cases falling under Article 36, paragraph 2, of the
Statute, "another method of pacific settlement" upon which the Parties have
agreed.
[293] Article 4 of the Treaty of 1931 requires recourse to the Court "unless
the Parties agree, in the manner hereinafter provided, to have resort to an
arbitral tribunal"; and Article 5 provides for giving effect to such an
agreement for arbitration. Under Article 7 of the Treaty, before any resort
to the Court or to an arbitral tribunal, "the Parties may agree to have
recourse to the conciliation procedure provided for in the present Treaty".
Hence it would seem that for the legal disputes which are covered by Article
36, paragraph 2, of the Statute and to which the reciprocal declarations of
Belgium and Bulgaria apply, the Treaty provides not a system of judicial
settlement alone, but a system of conciliation, arbitration and judicial
settlement, all three of which are in a sense bound together. Disputes for
which the declarations provide a settlement by the Court may under the
Treaty be referred to the Court, [p124] or to arbitration, or to
conciliation followed (if necessary) by the Court's adjudication, or to
conciliation followed (if necessary) by arbitration. The system of the
Treaty is then different from the system of the declarations, though the
judicial settlement (as distinguished from arbitration) is in both systems
confided to the Court. It may be said, however, that under the Treaty an
agreement between the Parties is necessary before conciliation or
arbitration can be substituted for or placed before judicial settlement, and
that even under the declarations it was open to the Parties to agree upon
the conciliation or the arbitration of a dispute as an alternative to
judicial settlement. Yet the system of the Treaty is in this respect
different from that of the reciprocal declarations, because the Treaty
provides in terms for the alternative and lays down the lines which the
alternative is to follow.
[294] The two systems being different, it would seem that this is a case in
which the Parties have agreed, in the terms of the Belgian declaration, "to
have recourse to another method of pacific settlement". If this conclusion
be sound, the reciprocal declarations by Belgium and Bulgaria are not to be
applied as a source of jurisdiction in this case, and the Court's
jurisdiction may be sought only in the Treaty of 1931.
[295] Note may here be made of Article 2 of the Treaty of 1931 which
provides that "disputes for the settlement of which a special procedure is
laid down in other conventions in force" between the Parties "shall be
settled in conformity with the provisions of such conventions". It is not a
simple matter to give a precise meaning to this provision [FN1]; but it
would seem quite clear that the Belgian and Bulgarian declarations are not
in this sense a convention laying down "a special procedure" for the
settlement of the legal disputes covered by Article 36, paragraph 2, of the
Statute.
---------------------------------------------------------------------------------------------------------------------
[FN1] See the strictures on this provision by "Gallus" (a pseudonym), in 57
Revue de Droit international et de L�gislation compar�e (1930), p. 879.
---------------------------------------------------------------------------------------------------------------------
*
[296] If it should be thought that the Treaty of 1931 does not provide for
"another method of pacific settlement" within the meaning of the concluding
phrase of the Belgian declaration, the Court would then have before it two
texts � the reciprocal �declarations of Belgium and Bulgaria on the one
hand, and the Treaty of 1931 on the other hand � dealing with the same
[p125] general subject-matter. In such a situation the relation between the
two texts cannot be disregarded.
[297] Each of the texts is a statement of the Parties' intention to confer
jurisdiction on the Court, but the jurisdiction is not the same in each
case. In consequence of the reserve in the Belgian declaration, the
reciprocal declarations had the effect of confining the Court's obligatory
jurisdiction to disputes with regard to situations or facts posterior to
March 10th, 1926; the text of the Treaty, on the other hand, is quite
opposed to this limitation. Article 4 of the Treaty gives the Court
jurisdiction over "all disputes with regard to which the Parties are in
conflict as to their respective rights"; these are expressly said to include
the disputes "mentioned in Article 36 of the -Statute", to some of which the
reciprocal declarations apply, and the Treaty does not exclude disputes with
regard to situations or facts anterior to any particular date. Clearly,
therefore, the Treaty's provision for the Court's jurisdiction is
inconsistent with that of the reciprocal declarations, and in this case the
two sources cannot be drawn upon simultaneously.
[298] Called upon to choose which of the two texts is to govern in this
case, the Court must apply a general principle of law, and it must say that
the expression of the Parties' intention which is the later in point of time
should prevail over that which is the earlier. The Parties had it in their
power to enlarge their legal obligations resulting from the declarations,
and this they did by the Treaty of 1931 which confers on the Court a more
extensive jurisdiction than that conferred by the declarations. Moreover,
the Treaty is an instrument which was drawn up to apply specially to the
relations of Belgium and Bulgaria; the declarations were not drawn up with
reference to the relations of Belgium and Bulgaria alone, each declaration
being made by one of these States with reference to its relations with all
other States recognizing the Court's jurisdiction as provided for in Article
36, paragraph 2, of the Statute. Whereas the declarations were of possible
and actual interest to many States, the Treaty, though it followed a
standard model, concerned only the two signatory States. If it is to be said
that the special prevails over the general instrument, or that the more
extensive prevails over the less extensive provision, the result here will
coincide with the application of the rule that a later will prevail over an
earlier text [FN1]. [p126]
---------------------------------------------------------------------------------------------------------------------
[FN1] On this point, see the discussion by "Gallus" in 8 Revue de Droit
international (1931), pp. 392-395
---------------------------------------------------------------------------------------------------------------------
*
[299] If confirmation is desired of the Parties' intentions that the Treaty
should confer on the Court a jurisdiction more extensive than that conferred
by the reciprocal declarations and not limited to disputes with regard to
situations or facts posterior to March 10th, 1926, it can be found in what
may be referred to as the pre-natal history of the Treaty of 1931. Though a
reference to this history was made by the Bulgarian Agent, neither of the
Parties endeavoured to place the whole record before the Court. The preamble
to the Treaty of 1931 recalls a recommendation made by the Assembly of the
League of Nations in a resolution of September 26th, 1928; this in itself is
a basis for summoning the aid of the Treaty's history.
[300] In 1927, the Eighth Assembly of the League of Nations, "anxious to
bring about the political conditions calculated to assure the success of the
work of disarmament", recommended "the progressive extension of arbitration
by means of special or collective agreements". To this end, it asked the
Council to instruct the Preparatory Disarmament Commission to create a
committee to consider measures which might be taken "with a view to
promoting, generalizing, and coordinating special or collective agreements
on arbitration and security" [FN1]. As a result of this resolution, a
Committee on Arbitration and Security was created, to which the Swedish
Government suggested the idea of a collective agreement based on the Locarno
treaties; this Committee prepared various drafts of conventions on pacific
settlement, all of which were faithful to the Locarno formul� in that they
contained provisions for excluding from the Court's jurisdiction disputes
concerning anterior facts [FN2]. The work of the Committee on Arbitration
and Security led to the adoption by the Ninth Assembly of the resolution of
September 26th, 1928 [FN3], to which reference is made in the preamble of
the Belgian-Bulgarian Treaty of June 23rd, 1931. This resolution invited
States to accept obligations concerning pacific settlement "either by
becoming parties to the annexed General Act, or by concluding particular
conventions with individual States in accordance with the model bilateral
conventions annexed hereto". To the resolution were annexed a draft General
Act and drafts of three model bilateral conventions, "Convention a",
"Convention b", and "Convention c". The annexed General Act contained in
Article 39 provision for possible reservations which would "exclude from the
procedure" provided for, "disputes arising out [p127] of facts prior" to
accession to the Act. The annexed model bilateral "Convention a" contained,
between Article 34 and Article 35, the word "Article1"; no number was
assigned to this "article" and no text was given, but the footnote to which
the figure "1" referred suggested that "States desiring to introduce
reservations might insert here an article based on Article 39 of the General
Act.... "2. Similar provisions were included in models "b" and "c". Thus,
the text of the draft General Act provided expressly for possible
reservations excluding disputes arising out of anterior facts, and the texts
of the model bilateral conventions carried an unnumbered blank article
referring to a footnote which called attention to the possibility of the
same reservation.
---------------------------------------------------------------------------------------------------------------------
[FN1] Records of Eighth Assembly, Plenary, pp. 177-178
[FN2] League of Nations Document, C. 358. M. 112. 1928. IX
[FN3] Records of Ninth Assembly, Plenary, p. 182.
[FN1] League of Nations Document, C. 358. M. 112. 1928. IX
[FN2] This note is to be found with the text of "Convention a" as published
in League of Nations Document C. 536. M. 163. 1928. IX; in Records of Ninth
Assembly, Plenary, p. 502; and in League of Nations Official Journal.
Special Supplement No. 63, p. 31.
---------------------------------------------------------------------------------------------------------------------
"Convention a", as annnexed to the Assembly resolution of September 26th,
1928, served as the model of the Belgian-Bulgarian Treaty of June 23rd,
1931; in general the text of the Treaty follows almost verbatim that of the
draft. Two significant departures are to be noted, however:
(1) The suggestion in the unnumbered, blank article placed between Article
34 and Article 35 of the draft was completely rejected when the Treaty was
drafted. For the text of the Treaty contains no reference to the exclusion
of disputes with regard to anterior facts, and neither in signing nor in
ratifying the Treaty did the Parties make any such reservation. This would
seem to be a clear indication of the Parties' intention that disputes with
regard to anterior facts should not be excluded from the jurisdiction
conferred on the Court by the Treaty of 1931.
[301] (2) Article 2 of "Convention a", following Article 29 of the General
Act, contains these provisions:
"1. Disputes for the settlement of which a special procedure is laid down in
other conventions in force between the Parties shall be settled in
conformity with the provisions of those conventions.
2. The present Convention shall not affect any agreements in force by which
conciliation procedure is established between the High Contracting Parties
or they are bound by obligations to resort to arbitration or judicial
settlement which ensure the settlement of the dispute. If, however, these
agreements provide only for a procedure of conciliation, after such
procedure has been followed without result, the provisions of the present
Convention concerning judicial settlement or arbitration shall be applied.
"[p128]
[302] The text of Article 2 of the Treaty of 1931 is quite different,
running as follows:
"Disputes for the settlement of which a special procedure is laid down in
other conventions in force between the High Contracting Parties shall be
settled in conformity with the provisions of such conventions. Nevertheless,
should the settlement of the dispute not be achieved by application of this
procedure, the provisions of the present Treaty concerning arbitration or
judicial settlement shall be applied. "
[303] The Treaty of 1931 thus fails to include the provision in paragraph 2
of Article 2 of the model adopted by the Assembly, which was designed to
continue the operation of prior obligations, such as those of reciprocal
declarations under Article 36, paragraph 2, of the Statute. This is another
indication of the Parties' intention that Article 4 of the Treaty of 1931
was to free them of the limitations established by the reciprocal
declarations, so long as the Treaty should remain in force.
*
[304] Further indication of the Parties' intentions as to the scope of the
Treaty of 1931 may be sought in the general policy followed by each of the
two signatory States in entering into treaties with other States.
[305] Bulgaria's general policy is quite consistently that indicated in the
Bulgarian declaration of 1921. Though Bulgaria did not accede to the General
Act of 1928, it entered into a number of treaties which follow the model
drafts adopted by the Assembly in 1928: with Turkey, March 6th, 1929 [FN1];
with Hungary, July 22nd, 1929 [FN2] ; with Poland, December 31st, 1929[FN3]
; with Spain, June 26th, 1931 [FN4] with Norway, November 26th, 1931[FN5] ;
with Denmark, December 7th, 1935 [FN6] ; and with Latvia, May 23rd, 1933. Of
these treaties only that with Poland excluded disputes with regard to
anterior situations or facts [FN7].
---------------------------------------------------------------------------------------------------------------------
[FN1] 114 League of Nations Treaty Series, p. 399.
[FN2] 101 idem, p. 41.
[FN3] 113 idem, p. 89.
[FN4] 166 idem, p. 341.
[FN5] 134 idem, p. 27.
[FN6] 182 idem, p. 183.
[FN7] Bulgaria's treaties with the United States of America, of January
21st, 1929 (93 idem, pp. 331, 337), and its treaty with Mexico, of November
5th, 1936 (187 idem, p. 37), follow special forms.
---------------------------------------------------------------------------------------------------------------------
[306] Belgium seems for a time to have assigned great importance to the
exclusion of disputes with regard to anterior situations or facts. Soon
after the signature of its declaration of September 25th, 1925, Belgium
entered into a treaty with [p129] Germany, initialled at Locarno on October
16th, 1925 [FN1], which (Art. 1) did not apply to "disputes arising out of
events prior to the present Convention and belonging to the past". Then
followed treaties with Sweden, April 30th, 1926 [FN2]; with Switzerland,
February 5th, 1927 [FN3]; with Denmark, March 3rd, 1927 [FN4]; with Finland,
March 4th, 1927 [FN5]; with Portugal, July 9th, 1927 [FN6]; and with Poland,
October 25th, 1928 [FN7] - all of which expressly excluded either disputes
with regard to anterior situations or facts, or disputes arising out of
prior events. A treaty with Spain, July 19th, 1927 , did not contain the
exclusion, but the final protocol gave a reason for this, viz., that no
dispute was then pending between the two States. A treaty with Luxemburg,
October 17th, 1927 , on the other hand, provided (Art. 1) for its
application to the disputes for the solution of which a method of pacific
settlement had been provided by the Economic Convention between the two
countries, even when such disputes referred to facts prior to the conclusion
of the treaty.
--------------------------------------------------------------------------------------------------------------------------------------------
[FN1] 54 League of Nations Treaty Series, p. 303.
[FN2] 67 idem, p. 91.
[FN3] 68 idem, p. 45.
[FN4] 67 idem, p. 117.
[FN5] 69 idem, p. 361.
[FN6] 74 idem, p. 39.
[FN7] Publications of the Court, Series D, No. 6, p. 308.
[FN8] 80 League of Nations Treaty Series, p. 17.
[FN9] 124 idem, p. 203.
---------------------------------------------------------------------------------------------------------------------
[307] Following the Assembly's adoption of its resolution of September 26th,
1928, Belgium acceded to the General Act on May 18th, 1929, with a
reservation as to disputes arising out of anterior facts [FN10]; but
thereafter some change is noticeable in Belgian policy. Belgium's treaties
with Czechoslovakia, April 23rd, 1929 [FN11] ; with Greece, June 25th, 1929
[FN12] ; with Lithuania, September 24th, 1930 [FN13] ; and with Bulgaria,
June 23rd, 1931, followed the Assembly's model "Convention a", and none of
them referred to the exclusion of disputes with regard to anterior
situations or facts. A treaty with Yugoslavia, March 25th, 1930 [FN14] , did
not apply to "disputes which arose prior to the conclusion of the present
Convention" ("diff�rends n�s ant�rieurement � la conclusion de la pr�sente
Convention"); while treaties with Roumania, July 8th, 1930 [FN15] , with
Turkey, April 18th, 1931 [FN16] , and with Venezuela, August 14th, 1935
[FN17], did not apply [p130] to disputes arising out of anterior facts and
belonging to the past [FN1].
---------------------------------------------------------------------------------------------------------------------
[FN10] 93 idem, p. 344.
[FN11] 110 idem, p. 113.
[FN12] 113 idem, p. 117.
[FN13] 129 idem, p. 399.
[FN14] 106 idem, p. 343.
[FN15] 128 idem, p. 403.
[FN16] Publications of the Court, Series D, No. 6, p. 475.
[FN17] Documents parlementaires (Belgique), 1935-1936, No. 75.
[FN1] Belgium's treaties with the United States of America of March 20th,
1929 (109 League of Nations Treaty Series, pp. 261, 267), and its treaty
with Persia of May 26th, 1929 (no idem, p. 369), follow special forms.
---------------------------------------------------------------------------------------------------------------------
[308] Of course the inclusions and exclusions in a treaty may be due to
insistence by either of the parties to the treaty. Yet this record seems to
point to the conclusion that the omission of the exclusion from the
Belgian-Bulgarian Treaty of 1931 was effected entirely by design, and that
it was due to an intention that the provisions of the Treaty should apply to
all disputes whether they concerned anterior or posterior situations or
facts. While some of the States with which Belgium entered into these
treaties were previously bound by declarations under Article 36, paragraph
2, of the Court's Statute, others were not; so that the difference in the
texts of the treaties cannot be explained by the previous position of these
States with reference to such declarations.
[309] A further point may be mentioned as to the character of the Treaty of
1931. On September 26th, 1928, the Council of the League of Nations
instructed the Secretariat to prepare "an introductory note explaining the
structure of the treaties", drafts of which had on that date been adopted by
the Assembly, and the note was to be communicated to Governments along with
the texts [FN2]. On October 15th, 1928, the Secretariat issued a document
containing the texts of the General Act and the model bilateral conventions,
with an "Introductory Note to the General Act and the model bilateral
Conventions a, b, c, for the Pacific Settlement of International Disputes"
[FN3]. In this Introductory Note it is said (p. 8) that "the General Act and
the three bilateral conventions are in substance the same"; and (on p. 9) it
is said that "the conventions had been drafted in such a manner that they in
no way affect other conventions of any kind which States may have concluded
or may conclude for the pacific settlement of disputes. The new conventions
will only be applied subsidiarily and will only settle disputes which do not
come within the scope of other conventions. " The importance of this
statement is not to be minimized; it is confirmed in the studies of the
General Act by the well-informed "Gallus", published in the Revue de Droit
international et de L�gislation compare [FN4] and in the Revue de Droit
international [FN5]. "Gallus" stresses the subsidiary character of the
General Act, derived from paragraph 2 of Article 29; [p131] and it has been
noted above that the model "Convention a" contained a counterpart of that
paragraph in its Article 2. The statement quoted from the Introductory Note
is applicable to the General Act because of the provision in Article 29,
paragraph 2, and to the model bilateral "Convention a" because of the
provision in Article 2, paragraph 2. It does not apply to the Treaty of
1931, however, for that Treaty contains no provision corresponding to
Article 29, paragraph 2, of the General Act, or to Article 2, paragraph 2,
of "Convention a".
---------------------------------------------------------------------------------------------------------------------
[FN2] League of Nations Official Journal, 1928, p. 1670.
[FN3] Document C. 536. M. 163. 1928. IX.
[FN4] Volume 57 (1930), pp. 190-246, 413-472, 878-925.
[FN5] Volume 8 (1931), pp. 377-424.
---------------------------------------------------------------------------------------------------------------------
[310] If it had been the intention of the Belgian and Bulgarian Governments
that their obligations under the reciprocal declarations should continue
unmodified during the period when the Treaty of 1931 was in force, this
result could have been accomplished by a simple expedient. The two States
might have acted on the Assembly's suggestion in the blank, unnumbered
article in Convention "a" and made a reservation as to disputes with regard
to anterior facts; or they might have retained in the Treaty a provision
corresponding to Article 2, paragraph 2, of "Convention a"; or they might
have stated expressly that the Treaty did not in any way modify the effect
of the prior declarations. It is not without interest in this connection
that this last suggested course was taken by certain other States in
concluding similar treaties [FN1], and even by Belgium in concluding the
Treaty with Persia of May 23rd, 1929 [FN2].
---------------------------------------------------------------------------------------------------------------------
[FN1] See the final protocol to the Austrian-Swiss Treaty of October 11th,
1924, 33 League of Nations Treaty Series, p. 432; the additional protocol to
the Convention of January 17th, 1925, between Estonia, Finland, Latvia and
Poland, 38 idem, p. 368; and the protocol of signature to the
Norwegian-Polish. Treaty of December 9th, 1929, 101 idem, p. 340.
[FN2] 110 idem, p. 369.
---------------------------------------------------------------------------------------------------------------------
*
[311] To summarize what has been said, first of all the reciprocal
declarations are not applicable in this case because it is a case for which,
to employ the concluding phrase of the Belgian declaration, the Parties have
agreed "to have recourse to another method of pacific settlement", the
method of the Treaty of 1931. Even if this view be rejected, however, as the
text of the Treaty is inconsistent with the texts of the reciprocal
declarations and as it is later in point of time, the Treaty must prevail
over the declarations during the period when the Treaty is in force. The
history of the Treaty shows that the Parties intended for a period to free
themselves of the reserve in the Belgian declaration, and to include in the
[p132] jurisdiction conferred on the Court disputes with regard to anterior
situations or facts. This is borne out, also, by the policy followed both by
Bulgaria and by Belgium in concluding treaties with other States. Two
essential differences existing between the Treaty of 1931 and "Convention a"
of 1928 make it impossible to attribute to the former the subsidiary
character which may be attributed to the latter.
[312] The conclusion to be drawn is that on January 26th, 1938, while the
Treaty of 1931 was in force, the relations between Belgium and Bulgaria with
respect to the jurisdiction of the Court were governed by the Treaty of 1931
and not by the reciprocal declarations made under Article 36, paragraph 2,
of the Statute. Hence, the Treaty of 1931 is the sole possible source of the
Court's jurisdiction to deal with this case.
***
[313] The conclusion that the Court's jurisdiction to deal with this case
must be derived, if at all, from the Treaty of 1931 makes it unnecessary to
enquire whether the condition set by the Belgian declaration, that the
dispute must be with regard to situations or facts posterior to March 10th,
1926, has been fulfilled in this case. The conclusion makes it necessary,
however, to enquire as to the fulfilment in this case of the two conditions
set by the Treaty of 1931, (1) the requirement of Article 1 that the dispute
must be one "which it may not have been possible to settle by diplomacy",
and (2) the requirement that on the hypotheses set out in Article 3 a
definitive decision must have been pronounced by a competent local
authority. Both of these questions have been raised in connection with the
Bulgarian preliminary exception.
*
[314] The provision in Article 1 of the Treaty, that the dispute must be one
which it may not have been possible to settle by diplomacy, is not a
meaningless formality. In the past the Court has drawn attention to the
importance of prior negotiations [FN1], and where the requirement is
expressly laid down in a treaty it cannot be disregarded. What is essential
is that prior to the filing of an application by one party bringing the
dispute before the Court, the other party must have been given the
opportunity to formulate and to express its views on the subject of the
dispute. Only diplomatic negotiations will have afforded such an
opportunity. The precise point at which it may properly be said that the
negotiations instituted cannot [p133] result in a settlement of the dispute
may have to depend, as the Court has also recognized [FN1] upon "the views
of the States concerned".
---------------------------------------------------------------------------------------------------------------------
[FN1] In the Mavrommatis case, Series A, No. 2, p. 15.
[FN1] Series A, No. 2, p. 15.
---------------------------------------------------------------------------------------------------------------------
[315] The submissions of the Belgian Government, as stated in its
Application and in its Memorial, relate to the alleged failure of Bulgaria
in its international obligations (1) by reason of the tariff put into force
in 1934 by the State Administration of Mines, to enable the Municipality of
Sofia to distort the application of the decisions given by the Mixed
Arbitral Tribunal in 1923 and 1925 [FN2]; (2) by reason of the judgments of
Bulgarian courts which deprived the Electricity Company of Sofia and
Bulgaria of the benefit of the decisions of the Mixed Arbitral Tribunal; and
(3) by reason of the promulgation of the law of February 3rd, 1936,
establishing a tax on the distribution of electric power purchased from
concerns not subject to tax. In so far as Belgium's claims are based on
grounds (1) and (2), they were the subject of diplomatic negotiations prior
to the filing of the Belgian Application on January 26th, 1938. It may
therefore be said that the dispute with respect to these claims was one
which, in the language of Article 1 of the Treaty of 1931, it was not
"possible to settle by diplomacy".
---------------------------------------------------------------------------------------------------------------------
[FN2] These decisions are reported in 3 Recueil des LLLDecisions des
Tribunaux arbitraux mixies, p 308 and 5 idem, pp 758, 770
---------------------------------------------------------------------------------------------------------------------
[316] With respect to the claim based on ground (3), i. e. on the
promulgation of the Bulgarian law of February 3rd, 1936, the situation is
different. This law was not referred to in the previous diplomatic
correspondence put before the Court; indeed, in the Additional Memorial of
the Belgian Government (p. 16), it was said that the Belgian Government had
judged it useless to engage in special negotiations relating to this part of
its claim. Though this statement was somewhat modified by the Belgian Agent
in the course of the oral proceedings, no proof was furnished of any
diplomatic negotiations relating to the law of 1936 which may have taken
place prior to the filing of the Belgian Application. It seems clear,
therefore, that the condition set by Article 1 of the Treaty was not met
with regard to the Belgian claims based upon the promulgation of the
Bulgarian law of February 3rd, 1936. Hence the Court lacks jurisdiction to
deal with this part of the Belgian claim.
*
[317] It remains to enquire whether the condition set by Article 3 of the
Treaty has been met with reference to that part of the Belgian claims which
relates to (1) the tariff put into force in 1934 by the State Administration
of Mines, and (2) [p134] the judgments of the Bulgarian courts, i. e. the
action taken by administrative and judicial authorities in Bulgaria in
connection with the application of the price formula fixed by the Mixed
Arbitral Tribunal in 1925.
[318] The first paragraph of Article 3 of the Treaty reads as follows:
"In the case of a dispute the occasion (Fr. Objet) of which, according to
the municipal law of one of the High Contracting Parties, falls within the
competence of its judicial or administrative authorities, the Party in
question may object to the matter in dispute being submitted for settlement
by the different methods laid down in the present Treaty until a decision
with final effect has been pronounced within a reasonable time by the
competent authority. "
[319] The provision has some resemblance to, but should not be confused
with, the common-law rule concerning the exhaustion of local remedies, which
was recently applied by the Court in the case of the Panevezys-Saldutiskis
Railway [FN1]. Provisions of similar import are to be found in a large
number of recent treaties.
---------------------------------------------------------------------------------------------------------------------
[FN1] Series A/B, No. 76.
---------------------------------------------------------------------------------------------------------------------
[320] It was not seriously contested in this case that under Bulgarian law
the application of the price formula fixed by the Mixed Arbitral Tribunal in
1925 is a subject (Fr. objet) which, in the first instance at any rate,
falls within the competence of the Bulgarian authorities. The exclusive
competence of the Bulgarian courts over disputes on this subject was
asserted by the Bulgarian Minister for Foreign Affairs in his letter of
August 3rd, 1937, addressed to the Belgian Minister; but it was also stated
in that letter that, par application de l'article 3 du m�me trait� (i. e.,
the Treaty of 1931), le Gouvernement bulgare revendique, en I'occurrence, la
comp�tence de ses propres tribunaux, et il ne saurait consentir � ce que le
diff�rend soit soumis aux diverses proc�dures pr�vues par ledit trait�. It
would seem to be possible to conclude that for the purpose of applying
Article 3 of the Treaty of 1931 the necessary hypotheses exist in this case.
The dispute here is one the subject (Fr. objet) of which, according to
Bulgarian law, falls within the competence of the judicial or administrative
authorities of Bulgaria; and by the letter of August 3rd, 1937, Bulgaria did
object to this dispute's being submitted for settlement by a method laid
down in the Treaty. That objection is a bar to an exercise of the
jurisdiction conferred on the Court "until a decision with final effect has
been pronounced within a reasonable time by the competent authority".
[321] In 1936, the Municipality of Sofia instituted an action in the
Regional Tribunal of Sofia against the Compagnie d'�lectricit� [p135] de
Sofia et de Bulgarie, seeking a determination of its rights and obligations
with reference to the sale-price of electricity at Sofia. The Compagnie
defended this action, contending inter alia that the Tribunal lacked
jurisdiction. Judgments were rendered in this action by the Regional
Tribunal of Sofia on April 30th, 1936, May 26th, 1936, and October 24th,
1936. The Compagnie, and later the Municipality, appealed to the Court of
Appeal, which gave its judgment on March 27th, 1937. An appeal (pourvoi)
taken to the Cour de cassation by the Compagnie on June 23rd, 1937, was
rejected on March 16th, 1938. It is not contended that the interval between
June 23rd, 1937, and March 16th, 1938, was more than a reasonable period
within the requirement of Article 3 of the Treaty of 1931. This being the
case, the facts seem to show quite clearly that when the Belgian Application
was filed on January 26th, 1938, the d�cision d�finitive required by Article
3 had not yet been pronounced by the competent authority.
[322] The conclusion follows that Article 3 of the Treaty of 1931 prevents
the Court from exercising the jurisdiction referred to in Article 4 of that
Treaty, with respect to the Belgian claim based upon the action taken by the
State Administration of Mines in 1934 and the judgments of the Bulgarian
courts in connection with the application of the price formula fixed by the
Mixed Arbitral Tribunal in 1925.
***
[323] I am therefore of the opinion that the Court's jurisdiction in this
case must be derived, if at all, from the Belgian-Bulgarian Treaty of June
23rd, 1931; that under Article 1 of that Treaty the Court has no
jurisdiction to deal with the Belgian claim relating to the promulgation of
the Bulgarian law of February 3rd, 1936; and that under Article 3 of that
Treaty the Court is precluded from exercising the jurisdiction which would
have been conferred by Article 4 of the Treaty with respect to the Belgian
claim based upon the action taken in 1934 by the State Administration of
Mines and upon the judgments of the Bulgarian courts in connection with the
application of the price formula fixed by the Mixed Arbitral Tribunal in
1925.
[324] On this view it is unnecessary to consider other questions which have
been discussed before the Court.
[325] For these reasons, I think the preliminary objection advanced by the
Bulgarian Government ought to be upheld.
(Signed) Manley O. Hudson. [p136]
Separate Opinion by M. De Visscher.
[Translation]
[326] Although concurring in the operative part of the judgment, I regret I
am unable to accept some of its grounds, particularly in regard to two
questions which are of considerable importance whether from a general point
of view or from the point of view of the present case.
[327] 1.� The first point with which I disagree concerns the relations
between the two diplomatic instruments upon which the Parties have relied.
The judgment regards the Belgo-Bulgarian declarations accepting the Court's
compulsory jurisdiction and the Treaty of June 23rd, 1931, as two separate
and independent sources of jurisdiction. In my opinion they are two
coordinated instruments; their respective provisions settle different
questions ; they are on that account fully consistent one with the other and
should be applied not as alternatives, but concurrently.
[328] Although, like the judgment and in conformity with the views of both
Parties, I admit that the declarations accepting the compulsory jurisdiction
of the Court remained in force during the current period of the 1931 Treaty,
I do so because I believe that, when they signed that Treaty, the two States
did not intend to establish a new source of jurisdiction. Bound in their
mutual relations, as from March 10th, 1926, by an obligation to accept the
Court's jurisdiction � an obligation with a longer term of application than
that of the Treaty � why should they have suspended it for the pre-arranged
term of five years assigned to the application of the Treaty and have
substituted during that period a new source of jurisdiction for the
pre-existing source, reverting by law to the latter on the expiry of the
Treaty ? The argument based upon the Treaty's later date would be decisive
in favour of the creation of a new source of jurisdiction only if it were
clearly proved that the subject-matter of the undertaking resulting from its
Article 4 was really wider in scope than that of the undertaking arising out
of the declarations accepting the compulsory jurisdiction of the Court. But,
although it is true that Article 4 � like the corresponding clause in the
General Act of Geneva (Art. 17), which it reproduces � substituted for the
definition of justiciable disputes contained in Article 36 of the Court's
Statute the definition of those given in the arbitration conventions annexed
to the Locarno Agreements (Oct. 16th, 1925), it cannot be said with
certainty that the latter definition is [p137] really any wider than that
contained in the above-mentioned Article of the Statute. The definition in
Article 36 is drafted in terms of objective law; that of the Locarno
arbitration conventions in terms of subjective law. That difference does not
allow us to assume any appreciable extension to the field of justiciable
disputes. As for the clause in paragraph 2 of Article 4 (Art. 17 of the
General Act, second sentence) : "It is understood that the disputes referred
to above include in particular those mentioned in Article 36 of the Statute
of the Permanent Court of International Justice", the work preparatory to
the General Act makes it clear that this clause was only included in the Act
because the Locarno definition had been thought by some to be in fact more
restrictive in certain respects than the definition in the Court's Statute.
[329] The two other provisions of the 1931 Treaty upon which the Bulgarian
Government bases its objection: Article 1, which prescribes diplomatic
negotiations, and Article 3 concerning previous exhaustion of internal
remedies, are in my opinion of quite another character. They do not strictly
concern the jurisdiction of the Court. These provisions appear in Chapter 1
of the Treaty, entitled : "Pacific Settlement in general". They lay down two
conditions which the Treaty regards as preliminary to any international
procedure falling within the methods in question, namely, conciliation,
arbitration and judicial settlement. The reference is no longer to the
Court's jurisdiction, but to conditions upon which the Parties have agreed
to allow recourse to that jurisdiction to depend.
[330] The two conditions are applicable to the Belgian Government's
Application; but, since the general spirit of the Treaty of June 23rd, 1931,
is obviously in favour of extending methods of peaceful settlement in
general, it is impossible to imagine that, when the contracting Parties
embodied in treaty form the rules upon which these conditions were to rest,
they intended to make them more binding in their effects than they are under
ordinary international law. This remark applies especially to the local
redress rule, which is formulated in Article 3 of the Treaty in the same
terms as in Article 31 of the General Act of Geneva. The preparatory work of
the Ninth Assembly (1928) of the League of Nations shows that the authors of
the General Act intended, in this matter as in others, merely to unify the
terms of the many previous arbitration conventions, which themselves had
only given expression to a rule long sanctioned by international usage. This
rule is in fact inscribed in Article 3 of the Treaty of June 23rd, 1931, in
terms almost identical with those of Article 3 of the Treaty of arbitration
and conciliation between Germany and Switzerland, dated December 3rd, 1921,
the prototype of these conventions. [p138]
[331] Finally, the conclusion to be drawn from a study of the various
agreements mentioned above is that, in accordance, moreover, with the views
of its most authoritative commentators, the General Act, in those of its
provisions which apply to judicial settlement and which are reproduced in
the 1931 Treaty, made little change in the system established by Article 36
of the Statute of the Court.
[332] Understood in this sense, the combined application of the declarations
accepting the Court's compulsory jurisdiction and of the 1931 Treaty cannot
involve any contradiction, the jurisdiction of the Court continuing to be
based upon the declarations, and the two conditions governing admissibility
contained in Articles 1 and 3 of the Treaty being therein fixed in
accord-dance with ordinary international law.
[333] 2. � The judgment appears to me to have interpreted Article 3 of the
1931 Treaty relating to the need of exhausting local remedies with a
strictness which seems to be in keeping neither with ordinary international
law, of which in my view this Article is the mere expression, nor with the
general spirit of the Treaty. My observations shall be brief.
[334] It is admitted that the rule requiring previous exhaustion of internal
remedies shall be applied, not automatically, but having regard to the
circumstances of the case and, more particularly, to any limitations which
those circumstances may impose upon the effective nature of the remedy. The
very text of the judgment delivered on March 16th, 1938, by the Bulgarian
Court of Cassation shows that, in the view of that supreme tribunal, a
number of apparently substantial grievances of the Belgian Company
constituted grievances of fact which lay outside the Court's jurisdiction.
In those circumstances it could only record the sovereign character in
regard to them of the judgment given by the Sofia Court of Appeal.
[335] A second circumstance is the attitude of the Bulgarian authorities
immediately following the birth of the dispute. In his letter of August 3rd,
1937, to the Belgian Minister in Sofia, the Bulgarian Prime Minister and
Minister for Foreign Affairs and Public Worship declared that "the matters
in dispute between the Municipality of Sofia and the Belgian Electricity
Company .... fall within the exclusive jurisdiction of the Bulgarian courts,
which have already given their decision upon them". In the same letter the
Bulgarian Government justified its decision to denounce the Treaty of June
23rd, 1931, on the ground that the Belgian Government intended to submit to
the Permanent Court of International Justice "a dispute which falls within
the competence of the Bulgarian courts". [p139]
[336] Finally, it is established that the Belgian Company, being bound to
exhaust the local remedies, did all that lay in its power to this end by
having recourse, on June 23rd, 1937, to the exceptional means of an appeal
to the Court of Cassation, and it is further agreed that the filing of the
Belgian Application on January 26th, 1938, was determined by the imminent
expiry of the Treaty which had been denounced by the Bulgarian Government
and the benefit of which the Belgian Government was attempting to preserve.
In these circumstances, was it necessary, on the basis of the Treaty, to
declare the Belgian Government's Application irregular, because it preceded
the judgment of the Bulgarian Court of Cassation ? In my opinion, the
circumstances briefly outlined above and the general spirit of the Treaty
justified a less formal attitude towards a procedure whose only fault lay in
its having been precipitated by the denunciation of the Treaty, while that
denunciation, taking effect on February 4th following, deprived the Belgian
Government, in advance, of the benefit of the appeal lodged by its national
with the Court of Cassation and which alone, according to the argument of
the Court's judgment, could lead to the "decision with final effect"
required by Article 3 of the Treaty of June 23rd, 1931.
(Signed) De Visscher. [p140]
Separate Opinion of M. Erich.
[Translation.]
[337] Although I agree with the operative part of the Court's judgment, I
regret that I have been unable to concur on every point in its arguments. I
think therefore I ought briefly to state my dissenting opinion..
[338] The two sources invoked by the Parties as binding upon them, namely
their declarations accepting the compulsory jurisdiction of the Court and
the Treaty of 1931 for as long as it continued in force, indicated between
them the extent of the mutual obligation of both Parties to submit their
disputes to the Permanent Court of International Justice. There is no doubt
that this mutual obligation based upon the declarations was in a certain
measure extended by the conclusion of the Treaty.
[339] Disregarding for the moment the argument ratione materi� invoked by
the Bulgarian Government in a very general and even rather diffuse form,
which argument the judgment has rightly held not to be a preliminary
objection, I find that the Bulgarian Government, while disputing the justice
of the Belgian Government's arguments in favour of the Court's jurisdiction,
asks the latter "to declare that it has no jurisdiction to entertain the
Application filed" and further declares "that the Application submitted by
Belgium to the Permanent Court of International Justice cannot be
entertained".
[340] The question whether the Bulgarian Memorial, when it speaks either of
"questions of jurisdiction and admissibility" or of "the question of
jurisdiction and admissibility", intended to raise a single objection
implying two objections, or two different objections, is of no decisive
importance.
[341] Bulgaria disputed the treaty bases of the Court's jurisdiction,
alleging generally the absence of any international element in the present
dispute and advancing, in the second place, with regard to the declarations,
the objection ratione temporis. The objection based upon Article 3 of the
1931 Treaty and disputing the admissibility of the Application, is of a
different character. A party who argues that an application cannot be
entertained is not maintaining thereby that the subject of the dispute does
not fall within the competence of the court in question; it is adducing a
certain circumstance which in its opinion constitutes an obstacle to
proceedings. The same is true when the party invokes the non-exhaustion of
local [p141] remedies or the absence of diplomatic negotiations, both cases
creating a gap which does not affect the jurisdiction of the Court as
recognized by the parties in question.
[342] An objection to jurisdiction and an objection to admissibility are not
therefore mutually exclusive. They may co-exist and should be examined
separately, even when the same party has impugned both jurisdiction and
admissibility. The fact that the party raising the objections has apparently
confused them is of no importance, provided that the distinction emerges in
fact from its claims.
[343] The objection to jurisdiction is obviously a preliminary objection in
relation to the objection to admissibility. If the Court finds that it has
no jurisdiction, the objection to admissibility lapses, having lost its
raison d'�tre ; if, on the other hand, the Court declares in favour of its
jurisdiction, it has not thereby affirmed that the application can be
entertained.
[344] Accordingly, if we are confronted with an objection to jurisdiction
and an objection to admissibility, we should begin by examining the question
of jurisdiction proper. If jurisdiction is not admitted, the whole case
falls to the ground and the objection to admissibility ceases to have any
relevance. In the opposite case the force of the objection to admissibility
is unimpaired and remains to be examined separately. The same is obviously
true when it is found that an objection to the jurisdiction of the Court is
closely bound up with the merits of the dispute ; the jurisdiction is here
too preserved, at least for the time being.
[345] The objection relating to exhaustion of internal remedies is
indivisible. The Party who advances this objection does not mean that, from
the point of view of the Treaty, these remedies are not exhausted, but that,
from another point of view, that of the declarations, the objection based on
exhaustion does not operate. The remedies are either exhausted or they are
not. Once the objection based on alleged non-exhaustion is found to be just,
it is impossible to cancel the effects of that finding by admitting also
that the jurisdiction of the Court is established. The establishment of
jurisdiction does not of itself suffice to rule out the objection to the
application being entertained.
***
[346] The argument ratione materi�, that is to say the general and somewhat
diffuse objection whereby the Bulgarian Government seeks to exclude the
Court's jurisdiction, was rightly denied to be a preliminary objection and
was reserved for [p142] examination with the merits. The objection ratione
temporis, which likewise challenges the jurisdiction of the Court, is
logically subordinate to the objection ratione materi� in the sense that,
should the latter be subsequently approved by the Court, the argument
ratione temporis would lose its raison d'�tre and become inoperative. If we
find that the case is not a dispute in the international sense, the question
of priority, or otherwise, of date would no longer arise.
[347] But since the Court has already examined the argument ratione
temporis, I should like to offer a few observations on this subject.
[348] The reservation ratione temporis inserted in many international
undertakings appears in different terms. When we exclude "disputes which
have their origin in facts prior to the present Convention", that expression
appears perhaps more restricted than the words used in the Belgian
declaration : "disputes arising after the ratification of the present
declaration with regard to situations or facts subsequent to this
ratification" ; fundamentally there is little difference between the
intentions of the contracting States. Any dispute caused by facts or
measures of a legal character prior to a certain decisive and crucial date
are excluded from the application of the rule. Such formulae may be
criticised as inexact and likely to cause confusion, but they must be given
the meaning which the contracting Parties had in mind.
[349] During the first stage of the present dispute, both Parties apparently
considered the origin of their dispute to lie in the formula contained in
the award of the Mixed Arbitral Tribunal of 1925. The Belgian Application
(p. 4), in telling the story of past events, speaks of the tariff formula
fixed by the Arbitral Tribunal. Until 1934 the application of this formula
gave rise to no difficulties, but disagreement arose for the first time in
the last quarter of that year. The compromise arranged for !935 was not
prolonged, "and the dispute again arose with regard to calculating the
tariff for the first quarter of 1936". In its Additional Memorial (p. 8) the
Belgian Government indicates as follows what it regards as the criterion in
order that the reservation in the Belgian declaration may apply: ".... it is
not enough that the dispute arising subsequently to this declaration should
have some relation with a situation in law or of fact prior thereto; the
dispute must arise with actual regard to that situation". The same phrase
"with regard to" is therefore found both in this general and abstract
formulation of the rule and in the above-mentioned sentence in the
Application which deals with the tariff formula fixed by the Arbitral
Tribunal. In the Belgian Government's Memorial (p. 14) the formula fixed by
this Tribunal is called "the disputed formula". [p143] From these
expressions and from several others it would appear that the Belgian
Government in the first stage of the dispute regarded certain alleged acts
by the Bulgarian authorities to be the subject-matter of the dispute, but
held the formula to be the source of it, in other words, the situation with
regard to which the dispute arose.
[350] If the Mixed Arbitral Tribunal had complied with the Company's request
when asked to give an interpretation of the arbitral award of May 27th,
1925, the dispute submitted to this Tribunal would obviously have been a
dispute directly with regard to the arbitral award,. And the same is true
when the Bulgarian courts were required to adjudicate upon the matter. The
salient point upon which their discussions turned was precisely "the
disputed award" of 1925. As the decisions by the courts failed to satisfy
the Company, the protecting State, Belgium, applied to the Court. It is
certainly not "the disputed formula" as such which was submitted to the
examination of the Court. If it were so, this formula would have to be
regarded as the actual subject of the dispute. The Belgian complaints are
directed against certain acts of the Bulgarian authorities, and it is these
acts which constitute the subject of the dispute ; it was they which
occasioned it. Essentially, however, they obviously assume the existence of
prior situations or facts (cf. the Court's judgment in the case of the
Moroccan Phosphates, p. 24). The dispute derives from facts prior to March
10th, 1926. The disputed award constitutes a situation prior to the crucial
date. That prior situation gave birth to differences of opinion that arose
subsequently to that date.
[351] If taken in a very limited sense, the ratione temporis reservation,
emphasized by many countries in their declarations, might become almost void
of substance. Alleged damage suffered before the entry into force of the
undertaking could be resuscitated by a claim submitted to some national
judicial or administrative authority subsequently to the crucial date. The
final dismissal of the claim could then be alleged as an unlawful act and as
the element giving birth to the dispute. In this way the interested party
would be enabled to revive a dispute to which, under the reservation, the
convention ought not to apply.
[352] For the reasons given above, I am inclined to regard the present
dispute as having arisen with regard to a situation prior to ratification of
the declaration. But the ratione temporis reservation operates only within
the limits of that declaration ; it was not inserted in the 1931 Treaty,
which was still in force at the time when the case was submitted to the
[p144] Court. Since the Court has adjudicated upon the ratione temporis
objection before giving any decision in regard to the preliminary ratione
materi� objection, I must declare at this stage that the distinction
according to whether the dispute is prior or subsequent to a certain date
does not apply in so far as concerns the 1931 Treaty.
***
[353] The Court has admitted the justice of the Bulgarian objection based on
failure to exhaust internal remedies. The Application must therefore be
regarded as inadmissible. According, however, to the view that prevailed,
the force of this finding is invalidated by the fact that the Court's
jurisdiction is accepted on the basis of the declarations of adherence to
the optional clause. Even if the contrary conclusion had prevailed, the
admission of the dispute as having arisen with regard to a situation
subsequent to ratification would have meant that Belgium would still have
the right to submit to the Court a fresh application on the basis of the
mutual declarations.
[354] In these circumstances, I can be brief on the question of exhaustion.
I would only say that the conditions required under Article 3 of the 1931
Treaty were not fulfilled at the time when the Belgian Government applied to
the Court. At the same time, the local redress rule, even if established in
a treaty clause, is not incompatible with certain departures from it,
although these, unlike the rule itself, are not laid down in a written text.
There are reasons for weighing the merits of an alleged departure from the
rule and for taking account of what appears reasonable in a particular case.
The Treaty of 1931, which requires that pacific methods of settling
international disputes shall be followed as far as is possible, was
denounced by one of the Parties at the moment when the Treaty was about to
be applied, and was denounced in order to prevent any examination of the
dispute by an international body. Belgium, who was probably not sure of
being able to approach the Court on the basis of the declaration, the latter
being subject to the ratione temporis reservation, was faced with a real
periculum in mora ; the action she took is explained by the abnormal
situation created by the denunciation of the Treaty. Furthermore, since the
Court of Cassation in Bulgaria delivered its judgment, the internal remedies
have in fact been exhausted. [p145]
[355] Although I hold that this objection to admissibility should have been
treated separately and independently of the question concerning the extent
of the Court's compulsory jurisdiction, I consider that a departure from the
local redress rule was in this case justified. On that account, and
notwithstanding differences of opinion on certain points, I have been able
to concur in the operative part of the judgment.
(Signed) R. Erich. [p146]
Dissenting Opinion by M. Papazoff.
[Translation.]
[356] Being unable to concur in the judgment affirming the jurisdiction of
the Court under the declarations of Belgium and Bulgaria accepting the
compulsory jurisdiction of the Court, I feel that I must briefly record my
separate opinion.
[357] Under Article 36, paragraph 2, of the Statute of the Court, Belgium
and Bulgaria have undertaken to recognize the compulsory jurisdiction of the
Court under the conditions laid down in their declarations of adherence.
[358] Bulgaria's declaration, which was ratified on August 12th, 1921, is as
follows : "On behalf of the Government of the Kingdom of Bulgaria, I
recognize, in relation to any other Member or State which accepts the same
obligation, the jurisdiction of the Permanent Court of International Justice
.... unconditionally."
[359] Belgium's declaration is as follows : "On behalf of the Belgian
Government, I recognize as compulsory, ipso facto and without special
agreement, in relations to any other Member or State accepting the same
obligation, the jurisdiction of the Court in conformity with Article 36,
paragraph 2, of the Statute of the Court for a period of fifteen years, in
any disputes arising after the ratification of the present declaration with
regard to situations or facts subsequent to this ratification, except in
cases where the Parties have agreed or shall agree to have recourse to
another method of pacific settlement."
[360] This declaration was ratified and came into effect on March 10th,
1926.
[361] The Bulgarian declaration makes one condition only, that of
reciprocity.
[362] It is however recognized that the limitation embodied in the Belgian
declaration applies as between the Parties, in consequence of the condition
of reciprocity made in paragraph 2 of Article 36 of the Court's Statute,
which is moreover repeated in the Bulgarian declaration.
[363] Accordingly, it is necessary to determine the meaning and scope of the
limitation embodied in the declaration of the Belgian Government. This
limitation comprises two conditions: (1) the dispute must have arisen after
the ratification of the declaration, and (2) the dispute must have arisen
with regard to situations or facts subsequent to this ratification.
[364] The Belgian declaration having been ratified on March 10th, 1926, it
is that date, which may be called the "material date", which must be taken
into account. [p147]
[365] The Belgian declaration is drafted in such a way as to preclude any
possibility of retrospective effect. The Court's compulsory jurisdiction is
only accepted for the future. In no case can the past be called in question.
That is why the condition that the dispute must have arisen after the
ratification of the declaration is not enough ; a further condition is
necessary, namely that it must not have arisen with regard to situations or
facts dating from before such ratification. In the present case, the two
Parties agree that the dispute arose after the material date (i.e., after
March 10th, 1926).
[366] The Bulgarian Government, however, which has raised an objection to
the jurisdiction ratione temporis, maintains that the second condition is
not fulfilled, because the present dispute has arisen in regard to
situations or facts dating from before March 10th, 1926. This objection is,
in my opinion, fully established by the particulars furnished in the written
proceedings. For the letter of the Belgian Minister of June 24th, 1937, in
which he expresses the intention of the Belgian Government to refer the case
to the Permanent Court of International Justice, contains the following
passage: "After a review of the previous facts, a careful study of the
judgment given by the Court of Appeal of Sofia on March 27th last has
convinced the Belgian Government that the judicial decision rendered
disregarded, notably on two points of fundamental importance, the rights of
the Company as defined by the Belgo-Bulgarian Mixed Arbitral Tribunal set up
under the Treaty of Neuilly, in its awards of July 5th, 1923, and May 27th,
1925, the strict application of which the Bulgarian Government was bound to
ensure under the express terms of an international agreement, namely Article
188 of the Treaty of Neuilly." This letter makes it plain that the dispute
arises from the situation established by the Belgo-Bulgarian Mixed Arbitral
Tribunal's awards of July 5th, 1923, and May 27th, 1925.
[367] The Belgian Memorial shows no less clearly that the present dispute
arose with regard to the situation created by these awards. On page 12 of
this Memorial we read : "In view of the disputes which arose with regard to
the application of the formula contained in the Mixed Arbitral Tribunal's
awards", etc. ; and on page 14: "the experts responsible for the disputed
formula" ; on page 22 : "the Belgian Government regards as a misapplication
of the Mixed Arbitral Tribunal's award", etc. ; and on page 33 : "The
Bulgarian High Courts have upset the very foundations of the whole system
worked out by the Mixed Arbitral Tribunal."
[368] This "system worked out" is certainly the "situation" created by the
awards of the Mixed Arbitral Tribunal of 1923 and 1925 with regard to which
the dispute arose. Without [p148] the "formula" established by the Mixed
Arbitral Tribunal there could have been no dispute.
[369] In my opinion, this "situation" and the dispute which arose in 1937
stand in the relation of cause and effect. The Company could not have
contended that its rights had been infringed, if the situation created by
the awards of 1923 and 1925 had not existed. But this situation dates from
before March 10th, 1926, and I think that that suffices. In my view it is
unnecessary that the situation should itself have given rise to the dispute
and that it should itself form the subject of a difference of opinion.
[370] No such condition is made in the Belgian declaration. What is laid
down is that the dispute must arise, that is to say must be born, after the
ratification of the declaration. Furthermore, in order to prevent the
declaration from having any retrospective effect, the dispute must have no
connection with earlier situations or facts. This condition is contained in
the words "with regard to". The essential point is that the past must not be
called in question in any way, since the declaration of adherence is only to
operate for the future.
[371] I find this interpretation of the words "with regard to" confirmed by
the fact that, whenever it was desired to take account of the origin of
disputes in earlier facts, this was expressly stated. In the many treaties
of conciliation, arbitration and judicial settlement concluded between
Belgium and other countries, two different formulae were used to fix the
non-retrospective condition. Thus in the treaties concluded between Belgium
and Germany, Turkey and Roumania we read: "disputes arising out of events
prior to the present Convention and belonging to the past".
[372] On the other hand, the treaties concluded by Belgium with Sweden,
Switzerland, Finland, Portugal, Poland and Denmark contain the same
expressions as those used in the Belgian declaration accepting the Court's
compulsory jurisdiction and specify that the treaty shall only apply to
disputes that may arise after the exchange of ratifications with regard to
situations or facts prior to that date. In these treaties there is no longer
any question of disputes "arising out of" prior events, nor any such words
as "dispute arising out of a prior situation".
[373] The fact that the present dispute goes back to a date prior to March
10th, 1926, is also clear from the submissions in the Belgian Memorial,
which, in enumerating the damage sustained by the Electricity Company, says
: "As the result of the judicial decisions rendered, the Company was
required to pay to the Municipality of Sofia or to the Bulgarian Treasury :
(a) as refund of excise alleged to have been collected under unlawful [p149]
conditions from 1925 to 1937", etc. Thus the dispute is concerned with sums
received as long ago as 1925.
[374] For the reasons given, I have come to the conclusion that the present
dispute, although it arose after the material date of March 10th, 1926,
arose with regard to a prior situation created by the awards of the Mixed
Arbitral Tribunal given in 1923 and 1925.
[375] I therefore hold that this dispute, by reason of the limitation
ratione temporis contained in the Belgian declaration, does not fall within
the jurisdiction of the Court.
(Signed) Papazoff. [p152]
Annex.
Documents Submitted To The Court.
I. - Documents Filed on Behalf of the Belgian Government
In the course of the written proceedings :
1. Award of the Mixed Arbitral Tribunal of July 5th, 1923.
2. Award of the Mixed Arbitral Tribunal of May 27th, 1925.
3. Award of the Mixed Arbitral Tribunal of October 30th, 1925.
4. Cahier des charges (extracts).
5. Tariff of the Pernik Mines, February 13th, 1924.
6. Tariff of the Pernik Mines, February 14th, 1925.
7. Tariff of the Pernik Mines, June 12th, 1925.
8. Letter of the Electricity Company of Sofia and Bulgaria to the Pernik
Mines, No. 707, May 8th, 1929.
9. Letter of the Pernik Mines to the Electricity Company, No. 5734, May
10th, 1929.
10. Letter of the Pernik Mines to the Electricity Company, No. 6627, May
29th, 1929.
11. Letter of the Municipality of Sofia to the Electricity Company, No.
6786, August 10th, 1931.
12. Letter of the Electricity Company to the Municipality of Sofia, No.
1286, October 6th, 1934:
13. Letter of the Municipality of Sofia to the Electricity Company, No.
7584, October 23rd, 1934.
14. Certificate issued by the Pernik Mines, October 24th, 1934.
15. Letter of the Electricity Company to the Municipality of Sofia, No.
1482, November 15th, 1934.
16. Letter of the Pernik Mines to the Municipality of Sofia, No. 28942,
November 15th, 1934.
17. Letter of the Municipality of Sofia to the Electricity Company, No.
8599, November 20th., 1934.
18. Letter of the Electricity Company to the Municipality of Sofia, No.
1531, November 26th, 1934.
19. Letter of the Pernik Mines to the Electricity Company, No. 30460,
November 26th, 1934.
20. Tariff of the Pernik Mines, December 3rd, 1934.
21. Note presented at a plenary meeting of the Municipality of Sofia,
November 30th, 1934.
22. Letter of the Electricity Company to the Municipality of Sofia, No.
1599, December 10th, 1934.
23. Convention of December 1934 fixing the tariff for the year 1935.
24. Letter of the Electricity. Company to the Municipality of Sofia, No.
1659, October 29th, 1935.
25. Letter of the Municipality of Sofia to the Electricity Company, No.
12651, December 13th, 1935.
26. Letter of the Electricity Company to the Municipality of Sofia, No.
1958, December 30th, 1935.
27. Letter of the Electricity Company to the Municipality of Sofia, No. 80,
January 27th, 1936. [p153]
28. Letter of the Municipality of Sofia to the Electricity Company, No. 824,
January 31st, 1936.
29. Letter of the Municipality of Sofia to the Electricity Company, No. 37,
January 20th, 1936.
30. Letter of the Electricity Company to the Municipality of Sofia, No. 91,
February 1st, 1936.
31. Letter of the Municipality of Sofia to the Electricity Company, No. 130,
February 3rd, 1936. '
32. Note verbale No. 840/1456, October 26th, 1935, from the Belgian Minister
in Sofia to the Ministry for Foreign Affairs and Public Worship. .
33. Aide-memoire No. 840/1457, October 27th, 1935, annexed to the note
verbale No. 840/1456.
34. Note verbale No. 840/117, January 27th, 1936, from the Belgian Legation
in Sofia to the Ministry for Foreign Affairs and. Public Worship.
35. Note verbale No. 840/125, January 28th, 1936, from the Belgian Legation
at Sofia to the Ministry for Foreign Affairs and Public Worship.
36. Note verbale No. 840/141, February 6th, 1936, from the Belgian Legation
in Sofia to the Ministry for Foreign Affairs and Public Worship.
37. Note verbale No. 4714-49-II, February 18th, 1936, from the Ministry for
Foreign Affairs and Public Worship to the Belgian Legation in Sofia.
38. Note verbale No. 12438-23-II, May 14th, 1936, from the Ministry for
Foreign Affairs and Public Worship to the Belgian Legation in Sofia.
39. Award of the Mixed Arbitral Tribunal of December 29th, 1936.
40. Claim of the Municipality of Sofia against the Electricity Company
brought before the Regional Court of Sofia.
41. Answer of the Electricity Company, March 14th, 1936.
42. Decision of the Regional Court concerning the admission of evidence.
43. Judgment of the Regional Court of Sofia upon the objection to the
jurisdiction, May 26th, 1936.
44. Judgment of the Regional Court of Sofia of October 24th, 1936.
45. Appeal of the Electricity Company, January 2nd, 1937.
46. Judgment of the Court of Appeal of Sofia, March 27th, 1937.
47. Communique issued by the Mayor (March 28th, 1937) and published in the
Sofia daily papers the day following the delivery of the Court of Appeal's
judgment and on the eve of the elections.
48. Letter of the Electricity Company to the Municipality of Sofia, No. 475,
April 28th, 1937.
49. Certificate drawn up by the officials of the Electricity Company and of
the Municipality respecting the restoration of the supply of current to
customers (April 29th, 1937).
50. Letter of the Municipality of Sofia to the Electricity Company, No.
2811, April 29th, 1937.
51. Letter of the Electricity Company to the Municipality of Sofia, No. 493,
May 5th, 1937.
52. Law regarding income tax of February 3rd, 1936 (extracts).
53. Circular No. 3800 of February 28th, 1936, of the Ministry of Finance.
54. Law amending and supplementing the law of February 3rd, 1936, regarding
income tax.
55. Letter of the Electricity Company to the Minister of Finance, May 18th,.
1936.
56. Letter of the Belgian Minister in Sofia to M. Kiosseivanofi, President
of the Council, No. 840/961, June 24th, 1937.
57. Letter of the Belgian Minister in Sofia to M. Kiosseivanoff, President
of the Council, No. 1144, July 30th, 1937.
58. Letter of the Minister for Foreign Affairs and Public Worship to the
Belgian Minister in Sofia, No. 19179-46-II, August 3rd, 1937.
59. Letter of the Belgian Minister in Sofia to M. Kiosseivanoff, President
of the Council, No. 1163, August 3rd, 1937.
60. Appeal of the Electricity Company to the Court of Cassation, June 23rd,
1937. [p154]
61. Judgment of the High Court of Cassation of Sofia, March 16th, 1938.
62. Decree Law of March 13th, 1938, .respecting the regulation of relations
between consumers of electric current and the Electricity Company.
63. Certificate issued by the Pernik Mines, June nth, 1936.
64. Certificate issued by the Pernik Mines, March 17th, 1937.
65. Regulations concerning the creation of Compensation Offices attached to
Chambers of Commerce.
66. Bulletin No. 891 (Dec. 25th, 1936) of the Sofia Chamber of Commerce and
Industry.
67. Letter of the National Bank of Bulgaria, No. 28900, November 26th, 1936.
68. Letter of the National Bank of Bulgaria, No. 33327, January 4th, 1937.
69. Judgment No. 133, February 5th, 1937, of the High Administrative Court.
70. Various laws concerning excise duties.
71. Regulations concerning the method of assessment and collection of excise
duty on electric current used for lighting (Sept. 16th, 1914).
72. Letter of the Municipality of Sofia to the Electricity Company, No.
2044, May 26th, 1928.
73. Letter of the Electricity Company to the Municipality of Sofia, No.
1197, May 29th, 1928.
74. Letter of the Municipality of Sofia to the Electricity Company, No.
2110, June 1st, 1928.
75. Letter of the Electricity Company to the Municipality of Sofia, No.
1300, June 8th, 1928.
76. Letter of the Electricity Company to the Municipality of Sofia, No.
1616, July 18th, 1928.
77. Letter of the Municipality of Sofia to the Electricity Company, No.
3536, July 24th, 1928.
78. Letter of the Municipality of Sofia to the Electricity Company, No.
10652, November 2nd, 1935.
79. Extract from the Judgment of the Court of Cassation, No. 283, of March
25th, 1926, concerning the Rodopi Company.
II. - Documents Filed on Behalf of the Bulgarian Government.
A. - In the course of the written proceedings :
1. Judgment No. 653, October 24th, 1936, of the Regional Court of Sofia.
2. Judgment No. 70, March 27th, 1937, of "the Court of Appeal of Sofia.
3. Judgment No. 177, March 16th, 1938, of the High Court of Cassation of
Sofia.
4. Minute of the Bulgaro-Belgian Mixed Arbitral Tribunal, October 30th,
1930.
5. Award of the Bulgaro-Belgian Mixed Arbitral Tribunal, December 29th,
1936.
6. Letter No. 840/568, April 22nd, 1937, from M. Motte, Belgian Minister in
Sofia, to M. Kiosseivanoff, President of the Council of Ministers, Minister
for Foreign Affairs and Public Worship of Bulgaria.
7. Certificate No. 3875, June 7th, 1938, of the Bulgarian Ministry of
Justice.
8. Bulgarian and Belgian declarations adhering to the optional clause
concerning the compulsory jurisdiction of the Permanent Court of
International Justice.
9. Treaty of conciliation, arbitration and judicial settlement of June 23rd,
1931, between Bulgaria and Belgium.
10. Letter No. 19179-46-II, August 3rd, 1937, from M. Kiosseivanoff,
President of the Council of Ministers, Minister for Foreign Affairs and
Public Worship of Bulgaria, to M. Motte, Belgian Minister in Sofia. [p155]
11. Letter No. 593, August 3rd, 1937, from M. Miankofi, Bulgarian Charge
d'affaires ad interim in Brussels, to M. Spaak, Belgian Minister for Foreign
Affairs and Foreign Trade.
12. Letter No. 452/1-438/5406, August 3rd, 1937, from the Belgian Ministry
for Foreign Affairs and Foreign Trade to M. Miankoff, Bulgarian Charge
d'affaires ad interim in Brussels.
B. - In the course of the oral proceedings :
- Collection of contracts between the Municipality of Sofia and the
concessionaires for the supply of electric power and for the Sofia tramways.
(Bulgarian and French texts. Sofia, 1930.)
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