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UAE Arbitration Civil Code Procedure with all Articles of Chapter 3
The Tinoco Arbitration (1932-1934) 2 Annual 2 Annual Digest of Public International Law Cases 341
Background: o
1917 - Governme Government nt of Costa Rica [Presiden [Presidentt Alfredo Alfredo Gonzales Gonzales]] overthro overthrown wn by Federico Tinoco.
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Tinoco assumed power & established new constitution During his tenure, he:
Granted certain concession concession to search for oil to a British company
Passed Passed legislation issuing certain new currencies, and British banks [in the course of business] became holders of much of this currency
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1919 - Tinoco retired, left the country – Government fall.
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Old constitution restored and elections were held.
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August 22, 1922, restored restored government passed Acts nullifying the currency currency laws it had made
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Consequence: Invalidated all transactions involved The restored government government is a signatory of the treaty of arbitration.
The Claim: o
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Brought by Great Britain on behalf of two British Corporations:
Royal Bank of Canada
Central Costa Rica Petroleum Company
Royal Bank of Canada claimed:
Banco Internacional of Costa Rica and the Government of Costa Rica are indebted to it proven by the holding of 998 1000 colones bills
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Central Costa Rica Petroleum Company [CCRPC] claimed:
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It owns the rights to explore and exploit petroleum reserves in Costa Rica This is based on a grant issued by Tinoco
At page 176 and 379.
The Defense: o
Great Britain:
On behalf of its nationals, legislation passed invalid
Restored Restored g’ment should recognize the concessions given to CCRPC and the validity of Tinoco’s currency held by the Royal Bank of Canada
During the period in question, the Tinoco Government had been the de facto and de jure government2
Suppor Supported ted by the fact that that the governme government nt was was not oppose opposed d in any significant manner
Thus giving the government legitimacy legitimacy All its acts were valid and its successor has no right to repudiate[annul] them
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Costa Rica:
Objected. Claimed that any acts carried out by the government were void because the Tinoco regime violated the Costa Rican constitution.
Becaus Because e Great Great Britai Britain n did not recog recogniz nize e the Tinoc Tinoco o Gover Governme nment nt as legiti legitimat mate, e, it cannot cannot then then turn turn aroun around d and and claim claim agreem agreement ents s with with an illegitimate government as binding.
Held: o
Rejected Costa Rica arguments
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While the failure on the part of Great Britain to recognize Tinoco government was evidenc evidence e to be take taken n into into accoun accountt in decidi deciding ng on the status status of that that government, it was not decisive as the status of the government had to be determined in the light of all evidence
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In fact, the Tinoco g’ment had been a de facto g’ment during the period of its existence
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UK always refused to recognize the Tinoco g’ment as either de facto or de jure government. H/ever, they still claim at the arbitration proceedings that the Tinoco g’ment was in fact a de facto and de jure government.
For the two years while in power, the Tinoco government served its role in a peaceful environment
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No objections, no revolution and no power dispute.
The court then holds that “the Tinoco government was an actual sovereign government.”
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The court finds in favor of the Royal Bank of Canada, but finds the petroleum concession to be a violation of the 1917 Constitution (which means Tinoco could have nullified the agreement as well).
Courts arguments which is significance to the aspect of International law: o
Scholarly writing: Dr. John Basset Moore: “Changes in the government or the inte interrnati nation onal al poli policy cy of a stat state e do not not as a rule rule affe affect ct its its posi positi tion on in international law.”
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States may change between forms of government without ceasing to be that stat state e in the the eyes eyes of inte intern rnat atio iona nall law, law, or in term terms s of its its inte intern rnat atio iona nall obligations.
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“The principle of the continuity of states” = “state is bound by engagements ente enterred into into by gove govern rnme ment nts s that that have have ceas ceased ed to exis exist; t; the the resto estore red d government is generally liable for the acts of the usurper.”
