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Published online by Cambridge University Press: 27 February 2017
1 For background information on the Iran-United States Claims Tribunal, see 77 AJIL 642 (1983).
2 Apr. 30, 1976, 29 UST 2203, TIAS No. 8937.
3 Article VI, §3 of the IMF Agreement states, in part: “Controls of capital transfers. Members may exercise such controls as are necessary to regulate international capital movements, but no member may exercise these controls in a manner which will restrict payments for current transactions or which will unduly delay transfers of funds in settlement of commitments. . . .”
4 The decision states, inter alia, that exchange contracts “will be treated as unenforceable notwithstanding that under the private international law of the forum, the law under which the foreign exchange control regulations are maintained or imposed is not the law which governs the exchange contract or its performance.” Decision No. 446–4 (1949), Selected Decisions of the International Monetary Fund and Selected Documents 131 (8th Issue 1976).
5 To assure the payment of Tribunal awards in favor of U.S. nationals, the Algiers Accords provide for the establishment of a Security Account, funded initially with $1 billion in certain Iranian assets that were frozen in the United States as a result of Iran’s seizure of American hostages in November 1979. For background information on the Algiers Accords, see 77 AJIL 642 (1983).
6 The Chamber cited three circumstances in particular: (1) that the applications for the bank drafts were not signed by the company for which claimant allegedly performed services, but rather by an individual whom claimant was unable to identify; (2) that certain evidence suggested that the company with which claimant allegedly dealt had been dissolved several years before the transaction in question; and (3) that claimant refused to give more than minimal information regarding the character of the underlying transaction.
7 See Commercial Code of Iran, Art. 313; Act Governing the Issuance of Cheques Approved on 16th Tir, 2535, Art. 2.
8 See Art. 24, para. 1 (“Each party shall have the burden of proving the facts relied on to support his claim or defence”).
9 See, e.g., Sandifer, D., Evidence Before International Tribunals 127 (rev. ed. 1975)Google Scholar; Legal Status of Eastern Greenland (Den. v. Nor.), 1933 PCIJ, ser. A/B, No. 53, at 49, 52 (Judgment of Apr. 5); Mavrommatis Jerusalem Concessions (Greece v. UK), 1925 PCIJ, ser. A, No. 5, at 29 (Judgment of Mar. 26); Temple of Preah Vihear Case (Cambodia v. Thailand), 1962 ICJ Rep. 6, 15–16 (Judgment of June 15).
10 Aug. 15, 1955, 8 UST 899, TIAS No. 3853. See Art. VII(l).
11 Holtzmann noted, for example, that the Tribunal had allowed respondents to introduce for the first time at the hearing the Bank Markazi circular, which allegedly rendered the transaction null and void. Having been confronted for the first time at the hearing with this evidence of the regulation’s existence, claimant argued in his posthearing brief that the invocation by the Bank of its own violation of the circular would result in its unjust enrichment. Similarly, respondents’ contention concerning the alleged nonexistence of the company with which claimant allegedly dealt was raised only in the respondents’ posthearing brief. As Holtzmann notes: “The circumstances of Mr. Dallal’s ‘late’ legal argument. . . are exactly paralleled by the Respondents’ ‘late’ factual argument concerning the non-existence of Lucky Company. Both are responses to matters raised at the Hearing. The majority rejects the former, while accepting and relying upon the latter.”
page 238 note 1 Claimant also named as respondent the Ministry of Energy of the Islamic Republic of Iran. The alleged contract, however, was solely with Khuzestan Water & Power Authority.
page 238 note 2 The Iranian arbitrator of Chamber Two, Mr. Shafie Shafeiei, failed to sign the award. Pursuant to Article 32, paragraph 4 of the Tribunal’s rules, Chairman Bellet and Arbitrator Aldrich attached a note to the award, explaining that the Tribunal “cannot permit its work to be frustrated” by virtue of the extended absence of Shafeiei, during which he remained incommunicado. Article 32(4) of the Tribunal’s rules states: “Where there are three arbitrators and one of them fails to sign, the award shall state the reason for the absence of the signature.”
page 239 note 3 The parties were requested to select the experts jointly by Oct. 1, 1983, with the understanding that if no agreement was reached by that date, the Chamber would appoint the experts. Also, in accordance with Tribunal Rule 41(2), the Chamber ordered claimant to deposit $25,000 with the Tribunal by Sept. 27, 1983 as an advance for the costs of expert advice. Rule 41(2) states: “The arbitral tribunal may request each arbitrating party to deposit an amount determined by it as advances for the costs. . . .”
page 239 note 4 Article VII(l) defines a U.S. national as
a corporation or other legal entity which is organized under the laws of . . . the United • States or any of its states or territories, the District of Columbia or the Commonwealth of Puerto Rico, if, collectively, natural persons who are citizens of such country hold, directly or indirectly, an interest in such corporation or entity equivalent to fifty per cent or more of its capital stock.
page 239 note 5 These evidentiary standards are consistent with prior decisions by Chamber One with respect to requirements for proving U.S. nationality. See Flexi-Van Leasing Inc. v. Islamic Republic of Iran, Claim No. 36, Order of Dec. 20, 1982 (Chamber One), and General Motors Corp. v. Islamic Republic of Iran, Claim No. 94, Order of Jan. 21, 1983 (Chamber One), summarized in 77 AJIL 642 (1983).
page 239 note 6 Article VII(3) defines “Iran” as “the Government of Iran, any political subdivision of Iran, and any agency, instrumentality, or entity controlled by the Government of Iran or any political subdivision thereof.”
page 239 note 7 Article 11(1) of the Claims Settlement Agreement excludes from the Tribunal’s jurisdiction claims “arising under a binding contract between the parties specifically providing that any disputes thereunder shall be within the sole jurisdiction of the competent Iranian courts.” Apparently, though it failed to state so explicitly, the Chamber believed that because the forum selection clause in the draft contract did not provide for the “sole” jurisdiction of Iranian courts, it did not bar the Tribunal’s jurisdiction. See Gibbs & Hill, Inc. v. Tavanir, ITL 1–6–FT (Nov. 5, 1982) (Full Tribunal).
page 240 note 8 In support of this conclusion, the Chamber cited both U.S. and Iranian Law. See Mass. Gen. Laws ch. 108A, §7; the Commercial Code of Iran, Art. 119; the Civil Code of Iran, Art. 575.
page 240 note 9 Request for Cancellation of Interlocutory Award, dated 27 July 1983 (Aug. 24, 1983).
page 240 note 1 The respondent filed six counterclaims, all of which were dismissed. In view of their disposition, the Chamber noted that it did not have to address the question whether shareholders are liable for the obligations of the corporation.
page 240 note 2 Jahangir Sani, the Iranian-appointed arbitrator, dissented. His dissenting opinion has not yet been issued.
page 241 note 3 See 77 AJIL 642, 643 (1983).
page 241 note 4 Claims Settlement Agreement, Art. VII(2).
page 241 note 5 Respondent asserted that the contract was invalid on the grounds that the official who signed it had no authority, that Pomeroy was not an approved contractor and that no Farsi-language version of the contract was executed.
page 241 note 6 Arts. 247 and 248.
page 242 note 7 Request of June 14, 1983. Under Article 35 of the Tribunal’s Rules of Procedure, either arbitrating party, with notice to the other party, may request that the Tribunal give an interpretation of an award. Article 36 allows an arbitrating party to request that the Tribunal correct in the award any errors in computation, any clerical or typographical errors, or any errors of a similar nature. Neither the Claims Settlement Agreement nor the Tribunal’s Rules of Procedure provide a procedure for appeal qr reconsideration of an award. Cf. Henry Morris v. Government of the Islamic Republic of Iran, Claim No. 200, Decision of Sept. 16, 1983 (Chamber One); and Claims Settlement Agreement, Art. IV(1) (all decisions and awards of the Tribunal shall be final and binding).
page 242 note 8 On May 31, 1983, Iran filed a request for Full Tribunal consideration of whether interest may be granted on awards. Case No. A/19. Of the 20 arbitrated awards issued by the Tribunal as of Oct. 1, 1983, 18 provide for payment of interest.
page 242 note 9 Article V states: “The Tribunal shall decide all cases on the basis of respect for law, applying such choice of law rules and principles of commercial and international law as the Tribunal determines to be applicable, taking into account relevant usages of the trade, contract provisions and changed circumstances.”
page 242 note 10 The award was paid to claimant on June 23, 1983. As of this writing, the Tribunal has not issued a decision on Iran’s request for reconsideration.