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The Function of Law in the International Community by Lauterpacht, Sir Hersch (14th July 2011)

Part IV Stability and Change in International Law, Ch.XIII

R. Lauterpacht

From: The Function of Law in the International Community

Sir Hersch Lauterpacht

From: Oxford Public International Law (http://opil.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 21 May 2019

Negotiations and consultation — Arbitration — Pacta sunt servanda

(p. 278) Chapter XIII 
The Judicial Application of the Doctrine ‘Rebus Sic Stantibus’

§ 10.  The Doctrine ‘rebus sic stantibus’ as the Negation of International Law.

In any discussion on the place of the doctrine rebus sic stantibus as a principle of change capable of judicial application it is essential to keep in mind the distinction between two fundamentally different aspects of the doctrine. It is in the first instance a pseudo-legal assertion of the absence of any binding force in international law. It is the expression of the view that the rule pacta sunt servanda does not apply to States with the same cogency as it applies to individuals, for the simple reason that they are States, and that their interests cannot be subjected to an obligation existing independent of their own will. As Hegel said, ‘The relation of States is one of independent units which make stipulations, but at the same time stand above their stipulations’.1 From Spinoza2 to modern deniers of international law the doctrine rebus sic stantibus has been appealed to not only as a consequence, but also as the very proof of the States' independence of the law. It has been one of the manifestations of the state of nature of which the relations of States were said to afford the only historical instance.3

The practice of States shows few examples of actual recourse to the doctrine rebus sic stantibus, and probably no examples of its recognition by States against whose treaty rights it has been invoked.4 It owes its fame and notoriety principally to writers who take it over from text-book to textbook by dint of vague but persistent references to the State's right of existence and self-preservation. Actually, even on those rare occasions on which treaties were broken under colour of the doctrine rebus sic stantibus it was obvious that no question of self-preservation arose unless, indeed, every change in the constellation of power enabling the State to (p. 279) disregard with impunity an onerous obligation be regarded as a material change of conditions implied in the treaty. The true function of the doctrine is to give expression to yet another aspect of the divorce of some orthodox notions of international law from general principles of law of undeniable universality—a divorce expressed, for instance, in the refusal to recognize the vitiating force of duress in the conclusion of treaties.

In fact, there is a close and not artificial connexion between the disregard of the vitiating effect of duress and the doctrine rebus sic stantibus. The connexion clearly exists in the domain of morals, inasmuch as it may not be absolutely repugnant to justice to maintain that a treaty imposed by force cannot claim the same sanctity as an obligation voluntarily undertaken. (The future student of international ethics will regard it as a redeeming feature of modern international law that a system of law postulating the validity of treaties concluded under the threat of physical compulsion evolved a doctrine absolving the State of its obligation as soon as it felt sufficiently strong to shake off the burdens of an imposed treaty.) But the association between the doctrine rebus sic stantibus and the admissibility of duress is of interest not merely from the ethical point of view. For, as a matter of historical experience, the main (although not the only) reason for invoking the doctrine rebus sic stantibus is in treaties imposed by force—treaties which, as a rule, do not contain any limitation of their operation in point of time,1 whose provisions are not invariably the product of far-seeing statesmanship, which are as a rule dictated by the victor after a trial of physical strength, and which, in consequence of the nature of the conditions imposed by them, perpetuate the consciousness of their merely factual origin. There is reason to believe that this aspect of the doctrine, although it looms large in text-books and contemporaneous politics, is not likely to retain its (p. 280) present position in international law. It will gradually lose its raison d'être in an international society in which the right of recourse to war for the purpose of giving effect to claims is renounced, and whose members have undertaken to respect and to guarantee mutually their political independence and territorial integrity as against external aggression. This is believed to be the tendency, although it is not always easy (in a world in which the legal position, created under what may be called old international law, still displays its full efficacy) to realize the fundamental changes brought about by general conventions like the Covenant of the League of Nations and, to some extent, the Treaty of Renunciation of War.

These developments do not, it is clear, contain a solution of the difficulties created by existing obligations arising out of treaties imposed by force in so far as they are, or may become, unjust and obsolete. But, subject to the exceptions to be discussed presently, the remedy does not lie here with a juridical doctrine capable of application by international tribunals. It lies in the nature of things that the interpretation of a treaty, by reference to the express or implied intention of the parties, one of whom claims the change of circumstances as a reason for the dissolution of the treaty, is hardly applicable to treaties in which the intention of one of the contracting parties was of little consequence, i.e. to treaties imposed by force. The remedy lies with the appropriate political agencies, and above all in an attitude of accommodation and reasonableness on the part of the States concerned—an attitude for the manifestation of which Article 19 of the Covenant may provide a convenient starting-point. It would be prejudicial to the authority of the judicial organs of the international community and its proper function to saddle it with the duty of revising political treaties imposed by force.

§ 11.  The Doctrine ‘rebus sic stantibus’ as a General Principle of Law.

The aspect of the doctrine rebus sic stantibus which is, on the one hand, an unavoidable consequence of the admissibility of duress and, on the other hand, an expression of the general weakness of international law qua law, does not exhaust the possibilities of the application of the doctrine itself. For, after the extra-legal elements of the doctrine have been eliminated, there still remains in it a (p. 281) legal residuum which, although of a limited compass, is capable of application by a judicial tribunal. The rule that compacts must be kept is certainly one of the bases of the legal relations between the members of any community. But at the same time the notion that in certain cases the law will refuse to continue to give effect to originally valid contracts is common to all systems of jurisprudence. Whether it be the rule ad impossibilia nemo tenetur in Roman law;1 or the various manifestations of the doctrine of frustration or supervening impossibility of performance in English law;2 or the express reference to changed conditions in the Austrian Civil Code;3 or Article 323 of the German Civil Code—according to which, if the performance due from one party under a contract becomes impossible in consequence of a circumstance for which neither he nor the other is (p. 282) responsible, he loses the claim to counter-performance—an article to be read in conjunction with the various provisions of German law permitting the termination of the contract before its fulfilment,1 and with the practice of German courts of abrogating or remodelling contracts vitally affected by a change of conditions;2 or, in France, the doctrine of imprévision as applied by the French Conseil d'État,3 or specific legislative enactments, like the loi Failliot embodying the substance of the doctrine,4 or the various provisions of the Code Civil mitigating the rigour of the contract in case of (p. 283) non-fulfilment of the obligation for reasons independent of the debtor1—all these rules and doctrines show clearly that, although the protection of the right to rely upon the contract is fundamental, there is nevertheless a relatively small segment of cases in which the law will recognize that the contract has, as the result of an unforeseen change of circumstances, failed to realize the true will of the parties and that it cannot be maintained wholly or in part. The sedes materiae of the effect of a change of conditions on legal obligations is not limited to the formula of physical or moral impossibility of performance. Elements of it will be found in the exceptio non adimpleti contractus in Roman law or the various condictiones, in particular of the exceptio causa data causa non secuta; in the rules as to unjust enrichment, clearly expressed in the Roman law condictiones,2 in specific provisions of some continental codes,3 in the practice of French courts,4 and even—in a somewhat rudimentary form—in English law;5 in the doctrine (p. 284) of laesio enormis of Roman law and the similar rules of other systems;1 in the branches of law regulating the contract of services,2 and the relation of partnership;3 in the rules limiting the freedom of persons to dispose of their future property;4 and even in the provisions as to revocability of gifts.5 Some of these rules are found in some systems of law while they are absent in others. But their cumulative effect is to give expression to the fact that the law, in some form or other, takes cognizance of the change of conditions subsequent to the creation of the obligation.

§ 12.  The Scope and Limitations of the Judicial Application of the Doctrine ‘rebus sic stantibus’.

The rule pacta sunt servanda is a general principle of law. But so, as we have seen, is the refusal to enforce contracts whose purpose has become impossible of fulfilment, not only physically but in general, having regard to the object of the transaction. In some systems of law the emphasis is upon the frustrated common (p. 285) will of the parties, in others upon the impossibility, physical or other, of performance. Legal theory oscillates between the two tests. As a rule, inasmuch as it is based upon the failure of an implied condition, it is a combination of the two. The impossibility of performance so construed must necessarily remain a rare occurrence, because the inconvenience to the debtor, and the disappointment of his expectations as the result of a change of circumstances, constitute only one element in the process of interpretation. The other is supplied by the insistence of the law on giving effect to the legitimate expectations of the other contracting party. However, the very fact that, when a relevant change of circumstances arises, the law does not ignore it entirely, tends to increase the sanctity of the contract and to relieve the tension between the conflicting claims of change and stability.1

It appears thus that the effect of the doctrine rebus sic stantibus as usually propounded in text-books has been doubly pernicious. Not only has it introduced an element of disintegration into conventional international law, but also, as the result of its sweeping comprehensiveness, it has rendered inoperative that residuum of the doctrine which constitutes a general principle of law to be found in most legal systems. This residuum is small but, as shown, it is not without importance. Whenever it occurs it is pre-eminently suitable for judicial adjudication. Moreover, however small, it cannot properly be given effect except through the instrumentality of an impartial judicial agency eliminating the element of arbitrariness, which is necessarily involved in the faculty of a unilateral declaration of the interested party that a decisive change of circumstances has taken place. In international law the fact that the ascertainment of the change of circumstances and of the voidance of the contract have been, in the absence of a compulsory jurisdiction of international tribunals, left to the appreciation of the interested party, has not only prevented the doctrine from acquiring the authority of a generally recognized rule of positive law, but has gained for it a notoriety illustrating one of the weakest links in international law.

A recent decision given on 29 June 1925 by a quasi-international tribunal, the German Staatsgerichtshof, in the case (p. 286) of Bremen v. Prussia, illustrates well the possibilities and the limitations of the doctrine rebus sic stantibus in international law. In a treaty concluded in 1904 the two States exchanged certain portions of territory. One of the objects of the transaction was to enable Bremen to acquire land for the purpose of constructing ports and other navigation works. It was laid down in the treaty that in the territory ceded to Bremen no works connected with the fishing industry should be permitted. As a result of the World War the aspirations of Bremen in regard to shipping were frustrated for a number of reasons, and she asked, therefore, while appealing to the doctrine rebus sic stantibus, for a rescission of the onerous condition imposing limitations upon her in regard to fisheries. The Court, while professing to administer rules of international law and while recognizing in principle the admissibility of the doctrine, declined to apply it in the case before it. It declined to do so on the ground that the restrictive clauses of the treaty formed, in the contemplation of Prussia, an essential and determining element of the transaction, and that they could not therefore be abrogated without her consent. At the same time the Court pointed out that, although there was no room for the application of the doctrine in regard to the major issue, the Court was prepared to consider it in respect of possible modifications of the provisions of the treaty relating to the payment of certain sums or to the observance of time limits fixed therein.1 It is seldom that one case illustrates so clearly the essential elements and the limitations of the application of a juridical doctrine. The case between Bremen and Prussia shows the recognition in principle of the doctrine rebus sic stantibus; it shows that its recognition in principle does not mean that (p. 287) every change of conditions, or every disappointment of the hopes of one of the parties, constitute a good reason for avoiding the treaty; but it shows at the same time that the inability of a court to apply it in regard to the contract as a whole does not preclude the possibility of its application in respect of the various aspects of the execution of the contract.

Possibly it could be argued that international tribunals may be permitted, and ought to avail themselves of, a larger measure of latitude than municipal courts in taking into consideration changes of circumstances resulting in the frustration or the substantial alteration of the object of the contractual obligation. For in municipal law there is the legislature at hand which may interfere with existing contracts in a manner in which courts may feel reluctant to act. It is this very possibility of legislative interference which frequently inspires courts with an amount of caution which would dangerously approach injustice but for the fact that the legislature may be ultimately counted upon to redress the balance. This may be well seen from the way in which Belgian and French courts refused to apply the doctrine of imprévision—a variation of the doctrine of frustration—to contracts affected by changes of circumstances as the result of war. Thus it was left in France to a legislative enactment, the well-known loi Failliot of 21 January 1918, to lay down that commercial contracts concluded during the War, or three months after the armistice, may be dissolved at the request of one of the parties if it is established that, by reason of the state of war, the fulfilment of the obligation by one of the contracting parties will impose burdens, or cause damage, materially in excess of the reasonable estimate at the time of the conclusion of the contract.1 A multitude of special enactments incorporated the principle of the doctrine in other fields of economic relations.2 But there is no legislature in the international society, and international tribunals may there feel constrained, in order to give effect to the intention of the parties and to requirements of justice, to exercise more discretion in taking into consideration relevant changes in conditions. As has been shown in the case of Bremen v. Prussia, this discretion need not necessarily take the form of rescinding the obligation as a whole; it may consist in the (p. 288) modification of the manner of its fulfilment and in its adaptation to new conditions. Thus, for instance, in regard to pecuniary debts, the Court, while maintaining the principal obligation, might decree modifications in the mode of payment1 by fixing the instalments, interest, and periods of payment. In regard to so-called ‘state servitudes’ the Court might, while leaving the servitude as such intact, take into consideration material changes in circumstances with a view to modifying the details of its execution. The function of English courts in regard to charitable trusts offers a suggestive analogy.2

§ 13.  The Justiciability of Disputes Involving the Application of the Doctrine ‘rebus sic stantibus’.

The application of the doctrine rebus sic stantibus in its juridical aspect is essentially a legal matter. The circumstance that it involves the consideration of facts does not, of course, deprive it of this character. The bulk of judicial activity within the State is to determine the legal relevance of facts. From this point (p. 289) of view the Permanent Court of International Justice would be entitled to deal with any matter involving the application of the doctrine rebus sic stantibus under that provision of Article 36 of its Statute which entrusts it with deciding ‘any question of international law’. Under that clause the Court is competent to ascertain and to decide on the relevancy of any fact or set of facts which are claimed to be creative of international rights and duties. For the phrase that the Court has to decide ‘any question of international law’ cannot mean that it has no jurisdiction (except in regard to international delinquencies) whenever a question of fact is raised. In the consideration of facts claimed to call for an application of the doctrine rebus sic stantibus, it will not as a rule be the facts which will be disputed; what will be disputed is the question whether they justify the application of the doctrine rebus sic stantibus. There is no good reason for interpreting the expression ‘any question of international law’ as meaning ex cathedra decisions on theoretical questions usually discussed by international lawyers, for instance, on the question whether the doctrine rebus sic stantibus forms part of international law.

It is true that Article 36 of the Statute refers specifically to ‘the existence of any fact which, if established, would constitute a breach of any international obligation’, but that does not mean that the consideration of other facts is excluded from the purview of the Court.1 Article 36 of the Statute abounds in such repetitions ex abundanti cautela. It confers upon the Court jurisdiction in disputes both ‘as to the interpretation of a treaty’ and ‘as to any question of international law’, although it is clear that the first category is comprehensively covered by the second. Most probably the three remaining categories of disputes are covered by the one relating to ‘any question of international law’ which, in turn, covers all possible disputes which States are content to submit to an international judicial tribunal. However that may be, some of the judgements of the Permanent Court of International Justice show that there is no disposition on the part of the Court to give a one-sided restrictive interpretation of the various categories enumerated in Article 36 of the Statute (p. 290) and Article 13 of the Covenant. In Judgement No. 14, in which the Court was asked in the Special Agreement to decide, inter alia, whether the Government of the Kingdom of the Serbs, Croats, and Slovenes was entitled to effect the service of certain loans in paper francs or whether it was under an obligation to pay the amounts due in gold or in foreign currencies, the question was raised whether the Court had jurisdiction to decide a dispute said to involve no question of international law, but only one of interpreting private law contracts under municipal law.1 The Court held that the clause conferring upon it jurisdiction in disputes concerning ‘the existence of any fact which, if established, would constitute a breach of an international obligation’ was sufficient to cover the case in hand, ‘for the States concerned may agree that the fact to be established would constitute a breach of an international obligation’, and because ‘the facts the existence of which the Court has to establish may be of any kind’.2 This interpretation by the Court of the phrase ‘the existence of any fact which, if established, would constitute a breach of an international obligation’ goes a good way towards dispelling the doubts to which this passage has given rise. It shows that the question whether a dispute can be brought within the clause discussed here is mainly one of terminology. Thus the disputed question, whether there has taken place a change of circumstances sufficient to justify the termination of a treaty, can well be put within the frame of the question whether the fact that a State claims the termination of a treaty on this ground, constitutes (having regard to the circumstances of the case) a breach of an international obligation. Other cases in which the Permanent Court had to interpret provisions analogous to those contained in Article 36 of the Statute show that a too literal construction may not be altogether sound or likely to secure the approval of the Court.3 That aspect of the doctrine rebus sic stantibus(p. 291) which represents a general principle of law ought to, and can, have a place in judicial settlement of international disputes. Within its necessarily limited scope it may prove a useful instrument for adjusting contractual obligations to changed conditions.

§ 14.  So-called Inter-temporal Law. Changes in the Law and Continuance of Rights.

In certain cases rights may cease to be effective as the result of the development of new rules of law attaching conditions of the continued validity of these rights. The possibilities of this mode of adapting existing rights to new conditions have been given expression in the award given by Professor Huber in April 1928 in the Island of Palmas arbitration between the United States and Holland. The United States claimed sovereignty over the island on the ground, inter alia, of its discovery by Spain in the first half of the sixteenth century. There seemed to be agreement between the parties to the dispute that the effects of the discovery by Spain must be judged in the light of contemporary law, i.e. the law in the matter of acquisition of title by discovery as it obtained in the sixteenth century. However, (p. 292) while prepared to assume that, as contended by the United States, mere symbolical discovery conferred at that time territorial sovereignty, he refused to agree that the title thus acquired continued irrespective of the changes which international law underwent on this subject in the following two and a half centuries. He said:

‘As regards the question which of different legal systems prevailing at successive periods is to be applied in a particular case (the so-called inter-temporal law), a distinction must be made between the creation of rights and the existence of rights. The same principle which subjects the act creative of a right to the law in force at the time the right arises, demands that the existence of the right, in other words its continued manifestation, shall follow the conditions required by the evolution of law.’

He pointed out that under the present rules of international law requiring effectiveness of occupation as an essential condition of acquisition of sovereignty, it was impossible to recognize the Spanish title as subsisting in the eighteenth and nineteenth centuries, even if it could be assumed that mere discovery was sufficient to confer the original title.1

The award, which established a distinction between the creation and the continuance of rights, constitutes a clear departure from the views expressed on this subject by a number of international lawyers.2 The conception of intertemporal law as applied by the arbitrator reveals yet another aspect of the relation between the factors of change and stability. Whereas the questions discussed in other parts of this chapter illustrated the effect of changed conditions on treaties, the award in the Island of Palmas arbitration shows the possible effects of a change in the customary rules of international law on existing legal rights in general. International tribunals have not so far had frequent opportunity to apply the doctrine of inter-temporal law. But it has been suggested by Lammasch, in another connexion, that if, for instance, a tribunal had to decide upon a claim for damages arising out of interference with slave traffic at a time when it was not generally condemned by international law, it would be entitled to base its decision on the law as existing at the time (p. 293) of the award.1 On two specific occasions the arbitration agreement provided that the award shall be given according to the rules of international law existing at the time of the events complained of,2 but it appears that these provisions had reference to subsequent changes in conventional international law.3


1  Grundlinien der Philosophie des Rechts, § 330.

2  Tractatus Theologico-politicus, xvi; Tractatus Politicus, iii. 14.

3  See below, p. 401. In modern phraseology this state of nature has been referred to as the relation of co-ordination—as distinguished from subordination to law—of sovereign States. See below, pp. 405 et seqq.

4  See Lauterpacht, Analogies, p. 170, n. 1. And see for a review of the more important cases Fischer Williams, Chapters, pp. 95–100.

1  International lawyers are in the habit of advising—as a remedy calculated to obviate the necessity of recourse to the doctrine rebus sic stantibus—the conclusion of treaties limited in time by means of suitable denunciation clauses. But it is seldom realized that—apart from treaties imposed by force and apart from cessions or exchanges of territory—international treaties are almost universally concluded for a limited period. A glance at treaties of commerce, of extradition, of pacific settlement, or of technical unions, will show how universal is this practice. Even the charter of the organized society of States, the Covenant of the League of Nations—is subject to two years' denunciation. See, however, the Treaties of Locarno and the Pact for Renunciation of War, which are not limited in point of time.

1  See, for some examples of interitus rei as a ground for release from the obligation, D. 7, 1, 37 ; D. 32, 1, 79, 2; D. 46, 3, 98, 8; D. 45, 1, 91, 1. And see Rabel, ‘Origine de la règle impossibilium nulla obligatio’ in Mélanges Gérardin (1907), pp. 473 et seq.

2  See McNair, ‘War-Time Impossibility of Performance of Contract’ in Essays and Lectures upon some Legal Effects of War (1920), pp. 78–98, for a lucid discussion of the leading cases and of the tendencies in the last sixty years. See also Fischer Williams, ‘Treaties and the Doctrine rebus sic stantibus’, Chapters, pp. 90 ff., and Brierly in Grotius Society, ix (1926), pp. 11–20, for a discussion of some more recent cases illustrating the development of the doctrine. Whereas in the leading case of Taylor v. Caldwell ( (1863), 3 B. and S. 826) the supervening impossibility is the physical frustration of the immediate subject-matter of the contract, in the well-known case of Krell v. Henry ([1903] 2 K.B. 740)—one of the group of the so-called Coronation Seat cases—the frustration was held to relate to the object of the transaction as a whole. It was ‘the frustration of the adventure’, as distinguished from the physical destruction of the subject-matter, which was held to be decisive in this case and in the long series of war-time cases. On the whole there was in Great Britain, as compared with continental countries, less disposition to judicial interference with contracts on account of a change of conditions resulting from the World War. The reason for this is not only the ‘sweet reasonableness’ of the majority of English business men, who did not insist on their strict contractual rights, but also the fact that the main reason for the difficulties on the Continent, namely, those resulting from depreciation of currency and the revolutionary changes in prices, did not occur in this country. In France a large amount of possible judicial interference was rendered unnecessary in consequence of appropriate legislative enactments (see below, p. 279), but in Germany judicial recognition in this connexion of the doctrine rebus sic stantibus was wide and comprehensive (see below, p. 274). As to the United States, see Dodd, ‘Impossibility of Performance of Contracts due to War-Time Regulations’ in Harvard Law Review, xxxii (1918–19), pp. 789–805. And see Holmes, J., in The Kronprinzessin Cecilie (244 U.S. 12), in which it was held that the failure of a German ship to deliver a cargo in England was to be excused on the ground that since war was imminent, there was grave danger of the ship being detained.

3  See, for instance, Article 936 in regard to pacta de contrahendo, which lays down that an agreement to conclude a contract in the future is only binding if the circumstances have not in the meantime changed so as to frustrate the express or implied object of the agreement.

1  See, for instance, Article 605 to the effect that the lender may give notice to terminate the loan, if, in consequence of an unforeseen circumstance, he has need of the thing lent; or Article 775 to the effect that the surety can in certain cases ask to be released if the financial condition of the debtor has become substantially worse, or in consequence of some other change in the circumstances of the principal debtor; or Article 542 relating to the termination of a contract of lease. And see, as to the termination of contracts of services, below, p. 276. As to the various aspects of the doctrine rebus sic stantibus in Italian law in general, see Vellani, La revisione dei trattati e i principî generali del diritto (1930), pp. 143 et seq.

2  The starting-point of this aspect of the activity of courts has been the apparently rigid Article 305 of the Code which lays down, inter alia, that for any alteration of the substance of an obligation a contract between the parties is necessary unless the law provides otherwise. An enormous literature on this Article in relation to the clause rebus sic stantibus has appeared in Germany since the World War. Copious references to it, and to the relevant judicial decisions, will be found in Staudinger's Gesammtnachtrag zur 7/8. Auflage des Kommentars zum Bürgerlichen Gesetzbuch (1922), pp. 89–94. Of the leading decisions there must be mentioned those of the Reichsgericht of 7 June 1921, in which the Court, in affirming its right to modify the terms of the contract, referred to ‘the elastic adaptation of the law to economic conditions’ as a means of fulfilling its true function of meeting the requirements of the time (Entscheidungen in Zivilsachen, cii. 94. See also ibid., cvii. 78, decision of 28 November 1923).

3  See the well-known Bordeaux Gas case decided on 30 March 1916, Sirey (1916), iii. 17, and the decision of 27 June 1919, Sirey (1920), iii. 25. See also Hauriou, Précis de droit administratif et de droit public, 11th ed. (1927), pp. 813–17; Fyot, Essai d'une justification nouvelle de la théorie de l'imprévision (1921); Voirin, L'Imprévision dans les rapports de droit privé (1922); Bruzin, Essai sur la notion d'imprévision et sur son rôle en matière contractuelle (1922) (with reference, inter alia, to the doctrine rebus sic stantibus in international law). And see Radoïkovitch, La Révision de traités et le Pacte de la Société des Nations (1930), an able monograph conspicuous for its reliance on the notion of imprévision. But it will be noted that, notwithstanding the insistent advocacy by writers, courts, to a large extent relieved of this task by the legislature, refuse to recognize the doctrine. See the decision of the Court of Cassation of 10 March 1919, Sirey (1920), i. 104, and of 6 June 1921, Sirey (1921), i. 193, and Dalloz (1921), i. 73. See also, to the same effect, Gyuot in vol. ii of the 13th edition of the treatise of Baudry-Lacantinerie (1925), § 141, who discusses the matter in detail, and Planiol, Traité élémentaire de droit civil (10th ed. by Ripert, 1926), ii, § 1168 bis. But see Page in La Belgique Judiciaire, 1924, columns 367–83, for a learned and lucid advocacy of the doctrine. However, the Belgian courts also have refused to recognize the doctrine, on the ground that it was for the legislature to redress the inconvenience occasioned by depreciation of currency.

4  See below, p. 279.

1  See, for instance, Article 1148 of the Code Civil, according to which damages or interest are not payable if vis major or inevitable accident have prevented the debtor from complying with his obligation; or Article 1150, which lays down that the debtor is liable only for such damage as was foreseen, or might have been foreseen, provided that the obligation had not been broken by his own fault. The rigidity of Article 1134, which says that agreements cannot be revoked except by mutual consent or for reasons permitted by law, is tempered by the rule that agreements must be carried out in good faith, and by the provision of Article 1135 to the effect that the agreement binds the parties not only to what is directly stated therein, but also to all the consequences of the obligation implied by equity, custom, and law. See on this point Naquet in Sirey (1920), i. 105; Page, op. cit. and Ripert, La Règle morale dans les obligations civiles (1905), Nos. 75 et seq.

2  Probably the general maxim ‘Jure naturae aequum est neminem cum alterius detrimento et injuria fieri locupletiorem (D. 50, 17, 206)’ might be regarded as the broadest basis for this and similar doctrines.

3  See, e.g., Article 832 of the German Code; Article 62 of the Swiss Code; Article 1119 of the Italian Code; Article 1261 of the Spanish Code.

4  See Baudry-Lacantinerie, op. cit., ii, Nos. 689 et seq.; Planiol, op. cit., ii, Nos. 932 et seq. Although the Code Civil contains a number of provisions applying the doctrine in specific cases (see Articles 548, 554, 555, 1241, 1846, 1926), it was left to the practice of courts and to writers to develop it as a general doctrine. See Planiol's Note in Dalloz, 1891, and Ripert, ibid. (1912), i. 217. See also Renard in Revue trimestrielle (1920), p. 243, and Gérota, Enrichisse-ment sans cause (1925).

5  It would be of interest to establish the relation between the remedy of assumpsit, in particular in regard to money paid for a consideration which has totally failed, and the doctrine, which has no distinct place in English law, of unjust enrichment. In 1760 Lord Mansfield in Moses v. Macfarlane (2 Burr. 1005) formulated clearly the remedy of indebitatus assumpsit which ‘lies for money paid by mistake, or upon a consideration which happens to fail; or for money got through imposition, or extortion, or oppression, or an undue advantage taken of the plaintiff's situation’. References to Moses v. Macfarlane have now disappeared from most of the text-books. But see Friedmann, Die Bereicherungshaftung im anglo-amerikanischen Rechtskreis in Vergleichung mit dem deutschen bürgerlichen Recht (1930), for a scholarly and interesting attempt to demonstrate that the notion of unjust enrichment is not foreign to the law of England and that it is a notion common to most systems of jurisprudence. The common law does not countenance the retaining of advantages ‘against equity and good conscience’. Mistake and failure of consideration are the basic elements of this aspect of quasi-contracts. Possibly, the relation between them and the doctrine of frustration is not unduly remote. Dr. McNair has suggested, in the fourth edition of Oppenheim (i. 753, n. 3), that ‘the basis of the doctrine of frustration is probably mistake’.

1  It will be noted that a number of international lawyers regard the notion of laesio enormis as the basis of the doctrine rebus sic stantibus. See G. F. de Martens, Précis du droit des gens de l'Europe, 2nd ed. (1864), ii. 166, and others referred to by Radoïkovitch, op. cit., pp. 117–32.

2  See, for instance, Article 626 of the German Civil Code to the effect that, if a grave reason exists, the notice to terminate the service relation may be given by either party without observance of any terms of notice; or Article 624 to the effect that if the service is entered into for the lifetime of a person, or for a term longer than five years, notice of its termination may be given by the servant after the lapse of five years. And see Boast v. Firth, L.R., 4 C.P. 1, on the termination of the contract as the result of the permanent illness of the servant, and Robinson v. Davison, L.R. 6 Ex. 269. See, generally, Fry on Specific Performance, 6th ed. (1921), pp. 428–34, on the effect of events subsequent to the contract. And see a recent case, Graves v. Cohen (1930), 46 T.L.R., in which it was held that a contract by a jockey to ride the horses of an owner is dissolved by the death of the owner.

3  See for the English law as to dissolution of partnership on the ground of permanent incapacity, conduct injurious to the business, and destruction of mutual confidence, the cases referred to in Lindley on Partnership (9th ed. 1924), pp. 688–94. And see Article 723 of the German Code to the effect that, if a grave reason exists, a partnership entered into for a fixed period may be dissolved before the expiration of that period.

4  Ibid., Article 310, rendering void a contract whereby one party binds himself to convey his future property.

5  Ibid., Article 530.

1  ‘Security may demand that he who does not get his due under a bilateral contract may put himself on the defensive and himself not perform’—Demogue, op. cit., p. 450.

1  Entscheidungen des Reichsgerichts in Zivilsachen, cxxii, Appendix, p. 21, and Annual Digest, 1925–6, Case No. 266. In fact, in those few instances in which the doctrine has been invoked before international tribunals, there has been no disposition to reject it outright. But one of the parties denied that it applied in the individual case. See, for instance, the recent decision of the Swiss Federal Court in Thurgau v. St. Gallen, of 10 February 1928 (Entscheidungen des Bundesgerichts, liv. i. 188, and Annual Digest, 1927–8, Case No. 289) in which the Court refused to apply the doctrine on the ground, inter alia, that the circumstances invoked as new were trifling. Similarly in the Russian Indemnity case, decided on 11 November 1912 by the Permanent Court of Arbitration (Scott, Hague Court Reports, pp. 317, 318), when Turkey pleaded that a change of conditions in the form of force majeure justified a delay in the payment of an agreed indemnity, the Tribunal was prepared to admit that the exception of force majeure may be pleaded in public international law, ‘as international law must adapt itself to political necessities’. But it denied that the circumstances were such as seriously to prevent Turkey from fulfilling her obligation.

1  S. et P., Lois annotées (1919), p. 892.

2  See Planiol, op.cit., ii, No. 170 bis.

1  On the meaning of ‘mode of payment’ see Fischer Williams, Chapters, p. 322.

2  See, on the power of the Court to alter a scheme settled by it for the administration of a charity ‘if the lapse of time and change of circumstances’ make such an alteration necessary in the interest of the charity, Halsbury, The Laws of England, iv. 187 et seq. And see ibid., pp. 190 et seq., on the cy-près doctrine and its application. See also Section 84 of the English Law of Property Act, 1925, which confers power upon Official Arbitrators appointed for the purposes of the Acquisition of Land Act of 1919 (see s.-s. 11) described as ‘the Authority’ ‘on the application of any person interested in any freehold land affected by any restriction arising under covenant or otherwise as to the user thereof or the building thereon, by order wholly or partially to discharge or modify any such restriction…on being satisfied: (a) That by reason of change in the character of the property or the neighbourhood or other circumstance of the case which the authority may deem material, the restrictive right be deemed obsolete, or that the continued existence thereof would impede the reasonable user of the land for public or private purposes without securing practical benefits to other persons, or would unless modified so impede such user.’ For the jurisdiction of the Court of Chancery apart from this provision see Bedford (Duke of) v. British Museum (1822), 2 Myl. and K. 552; German v. Chapman (1877), 7 Ch. D. 271; Knight v. Simmonds, [1896] 2 Ch. 294; Sobey v. Sainsbury, [1913] 2 Ch. 513, where the earlier cases were reviewed by Sargant, J., who held that even if there had been no implied release of the right to take proceedings to enforce the covenant, the Court was entitled ‘also to take into account the general change in the character of the neighbourhood irrespective of the particular acts and omissions of the plaintiff and his predecessor in title’. He then proceeded to point out that but for this, the effect would have been ‘to stereotype and perpetuate, far beyond the real intentions of the contracting parties, and to the prejudice of successive generations, restrictions which had in the course of time become obsolete and meaningless’ (at pp. 529, 530). See also James, L.J., in German v. Chapman, 7 Ch. D. 271 at 279; and especially Lindley, L.J., in Knight v. Simmonds, [1896] 2 Ch. 294 at 297.

1  See, however, Fischer Williams, Chapters, pp. 40, 41, and 100, 101, who gives a somewhat limited interpretation to the two clauses of Article 36 discussed above, and who maintains that the Permanent Court would not, under this Article, have jurisdiction to decide whether there has taken place such a material change of circumstances as to render a treaty obsolete.

1  For a statement of the objections to the jurisdiction of the Court in this case see the Dissenting Opinion of Judge Pessôa, P.C.I.J., Series A, No. 14, pp. 62–5.

2  Ibid., p. 19.

3  In Judgements Nos. 6 and 7 concerning certain German interests in Polish Upper Silesia the Court held that a convention conferring upon it jurisdiction in regard to ‘differences of opinion, resulting from the interpretation and application’ of some of its provisions, made it competent to decide whether a breach of these provisions had taken place. In Judgement No. 8 it held that that clause also conferred upon it jurisdiction to decide differences in regard to compensation claimed for the violation of these provisions. It referred to its Judgements Nos. 6 and 7 and, arguing a majore ad minus, it pointed out that ‘the decision whether there has been a breach of an engagement involves no doubt a more important jurisdiction than a decision as to the nature or extent of reparation due for a breach of an international engagement the existence of which is already established’ (Series A, No. 9, p. 23). The Court refused to attach decisive importance to the fact that Article 13 of the Covenant and Article 36 of its Statute differentiate between the various categories of these disputes (ibid.). In the Chinese-Belgian dispute, concerning Belgian exterritoriality rights in China, Belgium maintained that the Court was competent to decide under Article 36 of the Statute the question as to the applicability of the doctrine rebus sic stantibus. Belgian Mémoire of 3 January 1927, P.C.I.J., Series C, No. 16 (1), p. 22: ‘C'est à la Cour permanente de Justice internationale que doit être soumise, en dernier ressort, une contestation qui surgirait relativement à l'application du principe rebus sic stantibus entre deux États signataires tous deux de la clause facultative de compétence. Ne s'agit-il pas, en effet, suivant la théorie la plus généralement admise, d'une clause tacite contenue dans les conventions internationales conclues sans limitation de durée, et dont l'interprétation est dès lors éminemment de la compétence de la Cour? Il est donc loisible au Gouvernement chinois de tenter devant la Cour permanente de Justice internationale la démonstration que les circonstances qui ont inspiré les clauses du Traité de 1865 relatives à l'exterritorialité ont subi une transformation tellement radicale qu'une abrogation complète s'impose.’ In the French-Swiss Free Zones dispute (which, however, did not come before the Court by virtue of the Optional Clause) Switzerland did not in principle deny the right of the Court to apply the doctrine rebus sic stantibus. She only maintained that the clausula does not apply to international servitudes. See the speech of Professor Logoz, P.C.I.J., Series C, No. 19 (1), pp. 196–9. The Chinese Government denied the jurisdiction of the Court, not on the ground that the consideration of the doctrine rebus sic stantibus did not come within the purview of the Optional Clause, but because the dispute involved highly political and important matters of State sovereignty and equality. See above, p. 200.

1  See pp. 26 and 27 of the original award, and Annual Digest, 1927–8, Case No. 1.

2  See Heimburger, Der Erwerb der Gebietshoheit (1888), i. 139; Westlake, International Law (2nd ed., 1910), i. 114; and Strupp, Der schwedisch-norwegische Grenzstreit, in Schücking, Das Werk von Haag, Part II (1917), pp. 114 et seq.

1  Schiedsgerichtsbarkeit, p. 179. But see Lapradelle and Politis, i. 683.

2  Arbitration Agreement between the United States and Haiti in the case of Pelletier and Lazare, Moore, ii. 1750; and see Arbitration Agreement of 8 September 1900, between the United States and Russia in the cases of the Cape Horn Pigeon, J. H. Lewis and others, Lafontaine, p. 618.

3  See Westlake, op. cit., p. 114, note, in fine.