Page 139 - Law of Peace, Volume ,

law) that does not itself depart from the international standard. Neutral States in Naval and Aerial War 87 states:
(2) The rule in Subsection (1) does not justify failure to comply with A belligerent may, within its territory or within territory held in mili-
the requirements of procedural justice stated in 55 179-182 except as tary occupation, in case of urgent necessity, requisition a neutral vessel
stated in 5 199 with respect to emergencies.
privately owned and operated, or cargo owned by nationals of a neutral
Comment: State, if the vessel or the cargo was brought into such temtory volun-
a. General.The essential criterion in determining whether exercise of tarily and not as the result of compulsion or pressure exercised by the
police power, or enforcement of a law of a state, that causes damage to belligerent or by an allied belligerent; provided that this privilege may be
an alien is consistent with the international standard, is whether the con- exercised by a belligerent only if it pays the fair market value, under pre-
duct, in each me, is reasonably necessary to achieve the indicated ob- vailing conditions, of the vessel or cargo requisitioned.
jective, and whether that objective is consistent with the international
standard. The authorities dealing with cases of destruction are dis-
Illustrations: cussed in an accompanying comment. Article 22 provides
1. State A enacts a law requiring periodical inspection of livestock and that:
destruction of animals that are found to have certain communicable dis- A belligerent has no duty to pay compensation for damage to a neutral
eases. The law provides for compensation only in cases where more than vessel or other neutral property or persons, when such damage is inci-
five percent of a herd is destroyed. Pursuant to such inspection, the state dental to a belligerent's act of war against the armed forces of its enemy
destroys two percent of a herd belonging to X, an alien. The destruction and not in violation of the provisions of this Convention or of the law of
does not violate the rule stated in 5 185 regarding the taking of an alien's war. 88
property without just compensation.
3. State A makes an agreement with X, an alien corporation, granting 7-22. Reparation. a. General. The violation of interna-
it the right to extract minerals in designated areas of A's territory for a tional law creates an obligation on the part of the delin-
period of five years and providing for payment by X of a spec5ed quent to give satisfaction or reparation for the wrong to
royalty. Thereafter, A enacts a law imposing a reasonable income tax on the state injured by the violation. The violation may result
all corporations operating in its temtory with respect to income earned in either a material injury or what might be called a
there. Collection of the tax from X, in addition to collection of the
royalty, does not violate the rule stated in 5 185. "moral" injury. 89 The former is an injury to property or
to an individual, while the latter is an injury to the dignity
5 198. Currency Control
Conduct attributable to a state and causing damage to an alien does or sovereignty of a state. Since an international delict in-
not depart from the international standard ofjustice indicated in 5 165 volving a material injury, whether to state property or the
if it is reasonably necessary in order to control the value of the curren- property or person of a private individual, is an injury to
cy or to protect the foreign exchange resources of the state. the state itself, a moral injury will always accompany a
Comment: material injury. However, a moral injury need not neces-
a. Control of value of currency. It is generally recognized that devalua- sarily result in a material injury. For instance, the violation.
tion of currency does not give rise to state responsibility by reason of its
effect on an alien. of a treaty may cause no actual damage, but would still
constitute a moral injury, obligating the violating state to
b. Foreign exchange. Likewise, the application to an alien of a re-
quirement that foreign funds held within the temtory of the state be make appropriate reparation to the injured state.
surrendered against payment in local currency at the official rate of ex- 6. Reparation or satisfaction for a moral injury may
change is not wrongful under international law, even though the local consist of a formal apology or a monetary payment, or
currency is less valuable on the free market than the foreign funds sur- both. 90 Moreover, the mere fact that a state is adjudged
rendered.
to have violated international law may be sufficient,
Illustration:
reparation to the injured state. 91 If the reparation for a-
2. State A grants a concession to X, a national of state B, for mining
operations in the territory of A. To meet local expenses of the project, X moral injury consists of a monetary payment, the amount
opens an account in a bank in A with a deposit in currency of B. A needs will depend on the nature and magnitude of the injury to
currency of B to pay for food and fuel imports from B. It adopts a the dignity or sovereignty of the wronged state. When the
. .
foreign &change control system requiring all &edits in the currency of B moral injury is accompanied by or results from a material
to be surrendered in exchange for local currency at the official rate of ex-
change, which is the same rate at which X could have withdrawn local injury, the reparation often takes the form of a monetary
currency from his account, but substantially less favorable to him than payment measured by the damages of the individual
the free market rate. Enforcement of the requirement against X, that claimant, even though, in theory, the injury has been
converts his account into local currency, is not a violation of the rule suffered by the claimant state. I
stated in 5 188 with respect to the payment of full value for the taking of
an alien's property. c. As the Permanent Court of International Justice ob-
5 199. Emergencies served in the Case Concerning the Factory at Chonow: 92
Conduct attributable to a state and causing damage to an alien does
not depart from the international standard ofjustice indicated in 8 165 I
if it is reasonably necessary to conserve life or property in the case of 87. 33 Am. J. Intl L. Supp. 167, 359 (1939). hk
disaster or other serious emergency. 88. For a more detailed discussion of the conqpt of "military
necessity," see DA Pam 27-10.
b. There is authority for the principle that if an alien's 89. 1 Oppenheim, supra, note 71 at 352.
property within the territory of a belligerent is requisi- 90. The "I'm Alone" Case (Canada v. United States) Department
tioned or destroyed under pressure of urgent necessity, ofstate Arbitration, Ser. No. 2, at 4, 3 U.N.R.I.A.A. 1609, 1618 (1935)
[hereinafter cited as the "I'm Alone" Case].
compensation must be paid. Article 21 of the Harvard 91. The Corfu Channel Case [I9491 I.C.J. 4, 35.
Research Draft Convention on the Rights and Duties of 92. Chorzow Factory Case, supra, note 69 at 28.