International Business Law - Final Exam Dr.Yassin Elshazly

May 13th 2011

Omar El Tabbakh

Eslsca 33D

IBL Final Exam - Eslsca 33D Case I:

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Case I:

Country X purchased property in Chicago, USA, for its embassy. After country X has merged with

country Y to form country Z, the property was turned over to the new formed State. Country Z was

represented by a single ambassador to USA. Few years later, country Z was dissolved and Country

X and Y again became separate independent sovereign states. Country X then sought to reclaim its

embassy, but the property was being occupied at that time by a diplomat of country Y (who had

been country Z last ambassador) and he refused to return the property to country X. Subsequently,

the property was used as the country Y embassy. Country X Ambassador to USA brought suit in the

American Supreme Court against country Y Ambassador to USA seeking to reclaim possession of

the property. No one of country Y diplomats formally appeared to answer the suit. What should the

court say? Discuss

Facts:

Country X purchased property in Chicago, USA, for its embassy.

Country X has merged with country Y to form country Z.

The property was turned over to the new formed State (Z).

Country Z was dissolved and Country X and Y again became separate independent sovereign

states.

Country X then sought to reclaim its embassy.

The property was being occupied at that time by a diplomat of country Y.

Diplomat of Country Y refused to return the property to country X.

The property was used as the country Y embassy.

Country X Ambassador to USA brought suit in the American Supreme Court against country

Y Ambassador to USA seeking to reclaim possession of the property.

No one of country Y diplomats formally appeared to answer the suit.

Parties:

Country X.

Country Y.

Country Z.

Country X Ambassador.

Country Y Ambassador.

American Supreme Court.

Legal Problem:

According to the previous case,does Country X Ambassador has the right to seeking to

reclaim possession of the property ,and would American supreme court consider that claim

and how will it respond ?

Applied Rules:

“ Changing Sovereignty-State Succession“

General rule: successor state is bound to respect dispositive treaty, concerned with boundaries and

servitudes.

IBL Final Exam - Eslsca 33D Case I:

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Changes can happen in 4 main forms, in our case hereunder we are talking about “succession

of state”

Succession of state: occurs when a state dissolves, following the disintegration of a

predecessor and its constituent states assume the role of independent states. In this regard

successors states are bound by the treaties conclude by their predecessor in limits of their

respective territory.

Conclusion:

In that case ,the American supreme court is facing an international dispute between states and

not a case of private litigation between two ambassadors concerning property located in USA.

Moreover, it is not a private dispute over which a foreign state may exercise jurisdiction and

in which the parties to the dispute may be obliged to appear before the courts of that state.

Accordingly and finally, as this is a dispute between two sovereign states, no judicial decision

can be taken and the case would be considered Cancelled and DISMISSED.

IBL Final Exam - Eslsca 33D Case II:

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Case II:

In January 25th

2011, the Egyptian government of President Mubarak fell due to a popular

revolution. As usually occurs, members of the old regime fled the country to escape the reach of

“revolutionary justice.” But where defeated aristocracies once emigrated to London or Paris, now

they seem to wind up in Miami. One of the emigrants— Mrs. Lolita, the wife of President Mubarak

former Minister of Interior—brought the present suit to collect on a check for $150,000 issued to

her by the Egyptian Central Bank, shortly before Mubarak regime fall. Mrs. Lolita was unable to

cash this check after the new government assumed power and placed a stop-payment order on it.

Mrs. Lolita then brought suit against the Egyptian Central bank in a United States court seeking an

order to make it honor the check (which was drawn on a U.S. bank). The trial court instead granted

Egyptian Central’s motion for a summary judgment and dismissed the suit. Mrs. Lolita appealed.

What do you think could be the outcome of the appeal?

Facts:

In January 25th

2011, the Egyptian government of President Mubarak fell due to a popular

revolution.

Mrs. Lolita brought the present suit to collect on a check for $150,000 issued to her by the

Egyptian Central Bank.

Mrs. Lolita was unable to cash this check after the new government assumed power and

placed a stop-payment order on it.

Mrs. Lolita then brought suit against the Egyptian Central bank in a United States court

seeking an order to make it honor the check (which was drawn on a U.S. bank).

The trial court instead granted Egyptian Central’s motion for a summary judgment and

dismissed the suit.

Mrs. Lolita Appealed.

Parties:

Mrs. Lolita

Egyptian Central Bank.

United States Court.

Legal Problem:

Would the appeal of Mrs. Lolita be accepted or further investigated by the United States court?

“The Rights of individuals under International Law”

Applied Rules:

“State Responsibility”

International law looks upon individuals in two different ways: (1) it ignores them or (2) it treats

them as its subjects. The traditional view is to ignore them. This is based on the idea that

international law (or, more particularly, “the law of nations”) applies only to states.

The traditional international law concept that allows a state to seek compensation from other

states for injuries done to its nationals is known as the law of state responsibility.

IBL Final Exam - Eslsca 33D Case II:

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As International Courts doesn’t interfere between States and their own citizens unless only in basic

standards human rights or calls into question the territorial sovereignty of the state.

Conclusion:

The outcome of Mrs. Lolita’s appeal would not be taken into consideration and would be refused

and dismissed by the United States Court, based on the Traditional way of state responsibility Law.

IBL Final Exam - Eslsca 33D Case III:

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Case III:

A very serious air crash which occurred at Delhi airport, in India. An Airbus A-320 aircraft crashed

when coming in to land. Many of the passengers died and injured. Among the passengers on board

were two families of Indian origin who were American citizens with homes resident in London.

Four of them were killed, and the remaining four were injured. Following the publication of the

Report of a Court of Inquiry in India, in which the cause of the crash was identified as error on the

part of the pilots (both of whom were killed in the crash), the injured passengers claims were made

against Indian Airlines Corporation (“I.A.C.”), the employers of the pilots. Meanwhile the same

plaintiffs also commenced proceedings in London, where they sued a number of parties who might

have had some connection with the aircraft or its operation. These included the respondent

company, Airbus Industrie G.I.E. (“Airbus”), which designed and assembled the aircraft at

Toulouse in France. Similar proceedings were brought in Texas by the heirs of the four American

passengers who died in the same crash. In response to these proceedings in London, Airbus brought

proceedings for obtaining an injunction from the American High Court restraining the appellants,

who are American citizens, from continuing with their action against Airbus in London. Do you

think Airbus would succeed in its action? Explain.

Facts:

A very serious air crash occurred at Delhi airport, in India.

An Airbus A-320 aircraft crashed when coming in to land.

Many of the passengers died and injured.

Among the passengers on board were two families of Indian origin who were American

citizens with homes resident in London.

Four of them were killed, and the remaining four were injured.

The cause of the crash was identified as error on the part of the pilots (both of whom were

killed in the crash),as reported by the country of inquiry.

The injured passengers claims were made against Indian Airlines Corporation (“I.A.C.”), the

employers of the pilots.

Meanwhile the same plaintiffs also commenced proceedings in London, where they sued a

number of parties who might have had some connection with the aircraft or its operation.

These included the respondent company, Airbus Industrie G.I.E. (“Airbus”), which designed

and assembled the aircraft at Toulouse in France.

Similar proceedings were brought in Texas by the heirs of the four American passengers who

died in the same crash.

In response to these proceedings in London, Airbus brought proceedings for obtaining an

injunction from the American High Court restraining the appellants, who are American

citizens, from continuing with their action against Airbus in London.

Parties:

Delhi Air port in India.

London.

Texas.

Two families of Indian origin who were American citizens with homes resident in London.

The injured passengers.

Court of Inquiry in India.

Indian Airlines Corporation (“I.A.C.”).

The Respondent Company.

Airbus Industries G.I.E. (“Airbus”).

Heirs of the four American passengers who died in the same crash.

IBL Final Exam - Eslsca 33D Case III:

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American High Court.

Legal Problem:

Would Airbus succeed in its action?

“Anti-suit jurisdiction”

Applied Rules:

“Jurisdiction in Criminal Cases - Anti-suit jurisdiction “

Court order directing a person not to proceed with litigation in a foreign court. (This might be used

be the litigants home country court).

English courts to identify, for the first time, the limits which comity imposes on the exercise of the

jurisdiction to grant anti-suit injunctions.

It is at this point that the jurisdiction to grant an anti-suit injunction becomes relevant.

Conclusion:

It is consistent that anti-suit injunctions are “most often” necessary for the two purposes which were

specified. Indeed there may be extreme cases, for example where the conduct of the foreign state

exercising jurisdiction is such as to deprive it of the respect normally required by comity, where no

such limit is required to the exercise of the jurisdiction to grant an anti-suit injunction.

Accordingly and based on previous laws, Airbus would succeed in its injunction and the case will

be dismissed from the English Court.

IBL Final Exam - Eslsca 33D Case IV:

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Case IV:

Country R, decided to enter in a contract with the Harvester Company, a US corporation, to harvest

lumber on its land. According to the contract the Harvester Company has the right to harvest lumber

on Country R’s land for 20 years. The two parties agreed that Harvest company has one any dispute

to be resolved by the municipal courts of country R. After two years, country R decided to end its

contract with the Harvester Company and ordered it to cease its operations and leave the country

without being recompensed. The Harvester Company initiated an proceeding in front of the US

courts asking for compensation arguing that the courts of country R are corrupted and might deprive

them from any sorts of remedies in such circumstances. Do you think that the case should be

accepted?

Facts:

Country R, decided to enter in a contract with the Harvester Company, a US corporation, to

harvest lumber on its land.

According to the contract the Harvester Company has the right to harvest lumber on Country

R’s land for 20 years.

The two parties agreed that Harvest company has one any dispute to be resolved by the

municipal courts of country R.

Country R decided to end its contract with the Harvester Company and ordered it to cease its

operations and leave the country without being recompensed.

The Harvester Company initiated an proceeding in front of the US courts asking for

compensation.

Parties:

Country R.

Harvester Company.

Municipal courts of Country R.

US courts.

Legal Problem:

“Forum Selection clause in Personal Jurisdiction”

Country R decided to end its contract with the Harvester Company and ordered it to cease its

operations and leave the country without being recompensed.

The Harvester Company initiated proceeding in front of the US courts asking for

compensation arguing that the courts of country R are corrupted and might deprive them from

any sorts of remedies in such circumstances.

Will the US Court accept this ?

Applied Rules:

“In personam jurisdiction”

The power of a court or tribunal in determine the rights of a party who appears before it

“A forum selection clause “

IBL Final Exam - Eslsca 33D Case IV:

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A provision in a contract designating a particular court or tribunal to resolve any dispute that may

arise concerning the contract. However, there must be enough contact with the selected form state.

Form clause is usually accompanied by a choice of law clause.

“Choice of law clause”

A provision in a contract designating the sate whose law will govern disputes relating to the

contract. However, this choice could be sanctioned if it is used abusively in order to evade from

home state mandatory norms (ex; protection of miners or consumers).

Conclusion:

The United States Court shall interfere and accept the case and ask for compensation to Harvester

Company, due to enough contacts available and USA Courts would accept the case as this is an

American Corporation Company, and will put economical concerns into consideration.

IBL Final Exam - Eslsca 33D Case V:

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Case V:

Auto dealership in Canada sold a new brand X automobile to Mr. Y in Toronto. Brand X

automobile is manufactured in Germany by company A in order to avoid application of US taxes

law. A year later Mr. Y and his family decided to move to Mexico. As they drove through the state

of Oklahoma in USA, they were involved in an automobile accident. Mr. and Mrs. Y and their

children were severely injured. They brought a product liability suit in an Oklahoma state court

according to US Laws against the German manufacture of the automobile and the regional

distributor of brand X in Canada. Brand X automobile are not sold or serviced in Oklahoma. Both

defendants ask to have the suit against them dismissed for lack of personal jurisdiction.

Facts:

Auto dealership in Canada sold a new brand X automobile to Mr. Y in Toronto.

Brand X automobile is manufactured in Germany by company A in order to avoid application

of US taxes law.

A brand X has its dealer at Toronto, Canada where the dealer sells and serves the X Brand

Cars.

Mr. Y and his family lived in Toronto

A year later Mr. Y and his family is traveling to Mexico.

While droving through the state of Oklahoma in the United States, they were involved in an

automobile accident.

Mr. and Mrs. Y and their children were severely injured from the accident

They claim that their injuries are due to a defect in the brand X automobile.

Parties:

Auto Dealer.

Mr.Y & his family.

Company A “ Manufacturer of Brand X ”

Oklahoma State Court.

Legal Problem:

The defendants ask to have the suit against them dismissed for lake of personal jurisdiction.

Would Oklahoma state court accept this case ?

Under the rule of (Jurisdiction over Civil Cases)

Applied Rules:

“In personam jurisdiction”

The power of a court or tribunal in determine the rights of a party who appears before it

Conclusion:

Product X is a German manufactured product which was sold via the Canadian dealer ,and this

dealer and Product X manufacturer has no existence in the United states market.

Because the facts of this case don’t establish minimum contacts, the court should DISMISS THE

CASE . (Dismissed by Oklahoma’s Court)

IBL Final Exam - Eslsca 33D Case VI:

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Case VI:

Alcoa, an American company, contracted with the Jamaican government to construct an aluminum

factory in exchange for a 25-year bauxite mining concession, a promise of no increase in taxes for

25 years, and access to ICSID arbitration. Both the United States and Jamaica were parties to the

Washington Convention, and Jamaica’s ratification listed no reservations to the tribunal’s

jurisdiction. Alcoa built the plant and began mining bauxite. Then, Jamaica decided to levy a tax on

bauxite mining. Alcoa’s tax bill that year was $20 million. To avoid a suit by Alcoa, Jamaica filed a

reservation with ICSID excluding disputes relating to minerals or natural resources. Alcoa

nevertheless went ahead and began an ICSID arbitration. Jamaica refused to participate, relying on

its reservation. Should the ICSID tribunal proceed with the suit? Discuss.

Facts:

Alcoa, an American company, contracted with the Jamaican government to construct an

aluminum factory in exchange for a 25-year bauxite mining concession.

Promise of no increase in taxes for 25 years, and access to ICSID arbitration.

Both the United States and Jamaica were parties to the Washington Convention

Jamaica’s ratification listed no reservations to the tribunal’s jurisdiction

After operation started Jamaica decided to levy a tax on bauxite mining.

Alcoa’s tax bill that year was $20 million.

To avoid a suit by Alcoa, Jamaica filed a reservation with ICSID excluding disputes relating

to minerals or natural resources

Alcoa nevertheless went ahead and began ICSID arbitration.

Jamaica refused to participate, relying on its reservation.

Parties:

Alcoa Company (United States)

Jamaican Government.

ICSID Arbitration.

Legal Problem:

Should the ICSID tribunal proceed with the suit without Jamaican concern?

“ICSID Arbitration “

Applied Rules:

“ICSID Arbitration “

“Unilateral Withdrawal Is Ineffective”

If the proper consent has been given to establish an ICSID tribunal, then the tribunal can be set up

even when the host state or the investor refuses to participate.112 Also, once consent has been

given, it cannot be unilaterally withdrawn.113 A state party cannot withdraw by filing a later

reservation to the Convention114 or even by denouncing the Convention.115 (Book P 140)

IBL Final Exam - Eslsca 33D Case VI:

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Conclusion:

The tribunal decided that it had jurisdiction and that the proceedings would continue without

Jamaica's participation due to the following reasons:

consent to jurisdiction existed in writing.

consent existed at the time that the case was brought to ICSID.

notification of the reservation did not affect any prior consent.