The Exclusion of State Immunity Privilege in Tortious Activity International Law Essay

At present time, the only comprehensive multilateral convention on state immunity is the European Convention on State Immunity. The Convention was adopted by Council of Europe in 1972 with the aim to codify the rules of state immunity whereas many countries still followed to absolute doctrine of state immunity. Articles 1-15 contain main principles of restriction of state immunity with requirement of strict territorial nexus.

Article 4 provide commercial activity exception which states that "A Contracting State cannot claim immunity from the jurisdiction of the courts of another Contracting State if the proceedings relate to an obligation of the State, which, by virtue of a contract, falls to be discharged in the territory of the State of the forum".

But the main particularity of this Convention is provision of exception in tortious conduct. It is stated there in the Article 11 that: "A Contracting State cannot claim immunity from the jurisdiction of a court of another Contracting State in proceedings which relate to redress for injury to the person or damage to tangible property, if the facts which occasioned the injury or damage occurred in the territory of the State of the forum, and if the author of the injury or damage was present in that territory at the time when those facts occurred". According to this provision it is clear that jure imperii is not applicable anymore in tortious activity but the strict territorial nexus requirement shall be fulfilled.

The exclusion of state immunity privilege in tortious activity is provided in the United Nations Convention of Jurisdictional Immunities of States and their Property as well. However, this Convention will come into force after submission of thirtieth ratification instrument.

Other conventions on state immunity are very specific and relate to very narrow aspects of state immunity. Among such conventions there are, for example, the Brussels Convention on the Unification of State-owned Vessels (1926), International Convention on Civil liability for oil pollution damage (1969) and others.

On the basis of provided short overview of the current legal situation on state immunity in different legal systems the conclusion can be maid as following.

Adoption of legislative acts and moving away from governmental and private distinction in tortious activity make me think that common law states had more open-minded approach to state immunity. But, this distinction between the approaches of civil and common law states to restrictive doctrine cannot be essential over long time due to international conventions, which gradually establish overall united approach.

But it can be found one advantage in the absence of legislative acts in civil law states. It is namely that these states are not obliged to play in the frameworks of strict legislative acts. And that is why it gives to their courts more discretion in judgments. It shall be considered below.

1.3. Commercial exception

As laid down by the previous chapter, a state deprives its immunity in committing wrongs during its commercial activity and it would be right to consider this exception in court practice as well. By way of example in describing of this exception mostly the legislation and court practice of US will be taken.

The commercial activity is defined in FSIA as "either a regular course of commercial conduct or a particular commercial transaction". According to this legal norm, it becomes clear that the commercial activity does not suppose that defendant should be commercial entity but the cause of action should be based on commercial act. [1] The relationship between state and individual or legal person does no need to be commercial (if someone understand under "commercial" that activity which relates to commerce) but the conduct of state needs to be based on commercial act (transaction). [2] 

However, the significant problem to such aspect is the conclusion how to define that the claim is "based on" exactly commercial activity but not non-commercial one. [3] The answer to this question would be given in the following subchapters.

1.3.1. Identification of the relevant act

In establishment whether the claim of plaintiff is based upon the commercial activity it is first of all necessary to identify the relevant act. [4] 

According to the section 1605 (a) (2) of FSIA, the exception will be applied in case of the claim bases on "commercial act". Over long period of time in the finding of the relevant act, courts have paid more its attention to the wording "based on commercial act" not just "commercial act". They interpreted the relevant act as "the particular conduct giving rise to the claim in question actually constitutes or is in connection with commercial activity". [5] In other words, courts ask to establish "nexus" between commercial activity and wrong. [6] 

Courts later modernized their guidelines on identification of relevant act and stated that the "commercial act" had to form the "gravamen of the complaint". These both court interpretations of the relevant act found its place in the case of Saudi Arabia vs. Nelson. [7] 

Mr. Nelson had been employed through US Career Recruitment Company (that includes the signing of employment contract) in USA to work as engineer in the hospital in Saudi Arabia. He was arrested later and tortured for thirty-nine days in the Saudi Arabia. USA court dismissed the claim of Nelson because he did not find any connection between USA and wrong committed in Saudi Arabia.

The Court of Appeals revised the judgment of first instance and concluded that the claim was based on commercial but not governmental act because "the detention and torture of Nelson were so intertwined with his employment at the Hospital that they are "based on" his recruitment and hiring, in the Unites States" [8] . The Judge Edward Re stipulated that Nelson would not be arrested in Saudi Arabia if he had not been hired in US.

However, the Supreme Court revised the decision of the Court of Appeals. The Supreme Court stated that in order to be based on commercial act, such act must form "the gravamen of the complaint". [9] In other words "If Nelson's action had been for breach of the contract of employment rather than a legally independent tort, his recruitment and negotiation of the contract in the United States would have been a commercial act upon which his claims were based". [10] 

The Supreme Court concluded that claim was based on the torture but not on Nelson's recruitment in the hospital. The Court also added that the activity of police which arrested Nelson was governmental not commercial. [11] Nonetheless, someone might argue that court dismissed the claim of Nelson in the part where he brought the claim against state-owned hospital as well and according to the argumentation of the Court it would be considered as commercial activity.

In another case of Siderman de Blacke vs. Argentina [12] the Court decided the question of identification of the relevant act in the benefit of individual. Mr. Siderman was tortured and banished from Argentina. The government confiscated his business (hotel) and all property located in Argentina. It was anti-Semitism actions taken by Argentina officers. In this case if the Court considered the expropriation and other violations of human rights (tortures) as relevant acts these acts would not be recognized as commercial and certainly would not have any connection with US. But the Court stated that the claim of Mr. Siderman was based on operation of his Hotel. [13] The determination of operation of Hotel as relevant act made much easier for the Court to establish the "nexus" between the hotel's operation (attraction of tourists) and US.

On the basis of these two cases it can be seen which big problem can create the identification of relevant act. It can be assumed that it is important correctly identify the relevant act from which will depend the following question of application of immunity exception. And the big power in this identification is in the hands of courts, which shall be always motivated with the sense of making justice.

1.3.2. Nature/purpose tests

The second step in establishment of commercial activity exception is identification whether the relevant act is "commercial act". There is no such legal system in the world, which could describe how to determine whether the act is commercial or not. For such identification courts developed two tests: nature-test and purpose-test.

In earlier cases most of courts followed to the purpose-test. A good example of application of purpose-test can be taken from the National Iranian Gas Corporation case. [14] In 1978 National Iranian Gas Corporation concluded the contract with French company "Pipeline service" for the pipeline construction in Iran. But the French company was not paid for their rendered services. The French company sued Iranian corporation before French court. The court of first instance rejected the claim because of state immunity. Then after reclaiming petition the Court of Appeal stated that state immunity could not be invoked because the contract is still considered as private contract to perform public project. But then again the Court of Cassation reversed the judgment of the Court of Appeal and stated that immunity could be granted to foreign state not only in governmental acts but also in acts with the public interest. [15] In other words it can be concluded that the court used the purpose-test.

However, case-by-case courts passed to the nature-test. In section 1603 (d) of FSIA it is defined that: "The commercial character of an activity shall be determined by reference to the nature of the course of conduct or particular transaction or act, rather than by reference to its purpose". In other words the meaning of nature-test has been concluded according to ability of private person to commit the same act, which could be done by state as well. For example, such acts as legislating, providing national defense can be done only by state. [16] 

The court applied the nature-test in the above-mentioned Nelson case. As we remember from that case court rejected the claim of Mr. Nelson because it found that the relevant acts were actions of state officers and according to nature-test that alleged tortious acts were governmental. [17] It can be concluded that it was duty and authority in capacity of only state officers to keep order in the country and that is why it was considered as governmental but not commercial.

However, in the opinion of Joseph W. Dellapenna the nature-test cannot be always characterized correctly by the nature of acts of modern states. For example state orders clothes for its army, should we consider this act as making contract or providing the national defense? [18] These problems could be avoided if courts used the purpose-test. But the main disadvantage of this test is that state always pursue in its actions public purpose. [19] 

After analyzing of both tests it can be said that both tests have their own advantages and disadvantages. And application of the correct test is in discretion of the court. However, in practice, it shows that some courts prefer to follow only to the nature-test (USA), while some courts prefer to follow only to purpose-test (French courts). From my point of view the best solution would be if courts considered both tests. For example, United Nations Convention on Jurisdictional Immunities of State and Their Property offer to use two-tier approach for the determination of whether the act is commercial or non-commercial. [20] According to this test the court, firstly, need to consider the nature-test and if nature-test could not help much then to apply the purpose test only if "in the practice of the State which is a party to it [the contract or transaction], that purpose is relevant to determining the non-commercial character of the contract or transaction".

To sum up this chapter, it is seen that the doctrine of state immunity step-by-step appears to be more restricted in favor of individuals. Appearance of commercial exception itself announced the first victory of individuals over states. But in addition, commercial exception was developed further by creation of nature-test by judges. This test gave possibility to evaluate previously recognized "non-commercial" acts as "commercial" ones and increased chances of individuals to take the shield of immunity from states.

1.4. Tortious exception

Firstly it is needed to explain the approach of author to the structuring of this main part of thesis. In the subchapter 1.2 it was considered the current legal situation in civil and common law states, among which were mostly European states and USA due to their main achievements in the doctrine of state immunity. Now it is time to consider their no less important court practice in tortious activity.

More attention will be concentrated on European model because of their recent significant impact on development of the doctrine of state immunity. European model will not include torts of EU legal system. It was decided to consider the torts of EU legal system separately from European model because of the special status of EU law- above domestic law but not within of international law.

Tortious exception supposes the denial of state immunity in commitment of torts, acts of state causing death, injury, damage to property. In the framework of each model it is decided to consider two types of torts: firstly, domestic torts and secondly, torts with violation of fundamental human rights. It is marked out these two types of torts in the legal doctrine. [21] Domestic torts mean such torts, which relate to the sphere of domestic tort law (libel, slander, physical distress, mental anguish, and etc.). And logically to the second type of torts relate such torts, which beside domestic law also violate international law by causing injury to "life, limb and liberty" of individuals and these torts themselves constitutes the violations of international fundamental human rights. In this chapter author followed to this generally accepted classification of torts however sometimes under category of domestic torts were covered such torts, which could be classified as violations of human rights, however individuals did not rely on violation of fundamental human rights and limited the tools of protection of their rights by domestic law.

Sometimes it will happen that in the process of describing the tortious exception some previous court decisions may be mentioned again as appropriate for the deeper analysis and clarification of new aspects.

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