205

OPINION DISSIDENTE DE M. SHI
[Traduction ]

A mon grand regret, je ne peux pas souscrire aux conclusions de la
Cour quand celle-ci, compte tenu de la limitation ratione temporis figu-
rant dans la déclaration d’acceptation de la juridiction obligatoire faite
par la République fédérale de Yougoslavie (ci-aprés la Yougoslavie),
estime ne pas avoir compétence prima facie en vertu de l’article 36, para-
graphe 2, du Statut, auquel le demandeur et le défendeur sont l’un et
l’autre parties. Cette conclusion a empêché la Cour d’exercer le pouvoir
qui lui est conféré par le paragraphe 1 de l’article 41 de son Statut d’indi-
quer aux Parties des mesures conservatoires.

La Yougoslavie a signé sa déclaration d'acceptation de la juridiction
obligatoire de la Cour le 25 avril 1999. Par cette déclaration, la Yougo-
slavie a reconnu cette juridiction comme obligatoire «pour tous les dif-
férends, surgissant ou pouvant surgir après la signature de la présente
déclaration, qui ont trait à des situations ou à des faits postérieurs à
ladite signature...»

Cette limitation ratione temporis de la reconnaissance de la juridiction
de la Cour appartient à une catégorie de réserves qualifiée de «formule de
la double exclusion». Quand elle est face à cette «formule», la Cour doit
établir à quelle date le différend a surgi, d’une part, et de l’autre, a quelle
date remontent les situations ou les faits au regard desquels le différend a
surgi.

En ce qui concerne, en l’espéce, le premier aspect de la limitation
ratione temporis, c’est-à-dire le point de savoir si la date à laquelle le dif-
férend a surgi est antérieure ou postérieure a la signature par la Yougo-
slavie de sa déclaration d’acceptation, la Cour doit donc considérer quel
est l’objet du différend, comme elle l’a fait dans une situation analogue
dans l’affaire du Droit de passage, dans laquelle elle a déclaré:

«Pour apprécier la compétence de la Cour, il faut considérer quel
est l’objet du différend.» (Droit de passage sur le territoire indien,
fond, arrêt, C.I.J. Recueil 1960, p. 33.)

Dans la présente espèce, il figure dans la requête de la Yougoslavie une
section portant l'intitulé «Objet du différend», dans laquelle il est dit que
l’objet du différend porte sur les actes commis par le défendeur

«en violation de son obligation internationale de ne pas recourir à
Pemploi de la force contre un autre Etat, de l'obligation de ne pas
s’immiscer dans les affaires intérieures d’un autre Etat, de l’obliga-
tion de ne pas porter atteinte à la souveraineté d’un autre Etat, de

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LICÉITÉ DE L'EMPLOI DE LA FORCE (OP. DISS. SHI) 206

l'obligation de protéger les populations civiles et les biens de carac-
tère civil en temps de guerre, de l’obligation de protéger l’environ-
nement, de l'obligation touchant à la liberté de navigation sur les
cours d’eau internationaux, de l'obligation concernant les droits et
libertés fondamentaux de la personne humaine, de l'obligation de ne
pas utiliser des armes interdites, de l’obligation de ne pas soumettre
intentionnellement un groupe national à des conditions d'existence
devant entraîner sa destruction physique».

Comme dans l'affaire du Droit de passage, le différend d'ordre juri-
dique dont la Cour est saisie comprend, comme on vient de le voir, plu-
sieurs éléments constitutifs. Avant qu’existent tous ces éléments constitu-
tifs, on ne peut pas dire que le différend a surgi. Or, aucun des éléments
ci-dessus n'existait avant la date critique du 25 avril 1999. Il est exact que
les bombardements aériens du territoire de la Yougoslavie ont commencé
quelques semaines avant cette date critique de la signature de la déclara-
tion. Mais les bombardements aériens et leurs effets ne sont que des faits
ou des situations et, a ce titre, ne constituent pas un différend d’ordre
juridique. Les éléments constitutifs du différend actuel ne sont pas pré-
sents avant la date critique et ils n’existent qu’a la date de la requéte de la
Yougoslavie, le 29 avril 1999, et à compter de ladite date. Il est exact
qu’antérieurement à cette date critique, la Yougoslavie avait accusé
POTAN de recourir contre elle à un usage illicite de la force (voir les réu-
nions du Conseil de sécurité en date des 24 et 26 mars 1999, S/PV.3988 et
3989). Toutefois, cette plainte ne constitue tout au plus que l’un des nom-
breux éléments constitutifs du différend. En outre, il est impossible
d'identifier l'OTAN au défendeur et, en l'espèce, l'OTAN ne saurait non
plus être le défendeur ratione personae. Le différend d'ordre juridique n’a
surgi qu'à la date de la requête, laquelle est postérieure à la signature de
la déclaration d'acceptation. Par conséquent, la condition d’ordre tem-
porel à remplir pour que le présent différend entre dans le champ de
l'acceptation de la juridiction obligatoire ratione temporis tel qu'il est
défini dans la déclaration de la Yougoslavie, est bel et bien remplie.

En ce qui concerne le second aspect de la formule de double exclusion
de la Yougoslavie, c’est-à-dire la situation ou les faits que la Cour doit
prendre en considération, ce sont ceux au regard desquels le différend a
surgi, c'est-à-dire les situations ou les faits qui en sont l’origine.

L'article 25 du projet d'articles sur la responsabilité des Etats, adopté
en première lecture par la Commission du droit international, dispose au
paragraphe |:

«1. La violation d’une obligation internationale par un fait de
l'Etat ayant un caractère de continuité se produit au moment où ce
fait commence. Toutefois, le temps de perpétration de la violation
s'étend sur la période entière durant laquelle ce fait continue et reste
non conforme à l'obligation internationale.» (Annuaire de la Com-
mission du droit international, 1978, vol. IL, deuxième partie, p. 101.)

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LICÉITÉ DE L'EMPLOI DE LA FORCE (OP. DISS. SHI) 207

Cette conception de la durée d’un acte illicite «ayant un caractère de
continuité» est communément acceptée par les juridictions internatio-
nales et les commentateurs faisant autorité.

Dans la présente espèce, le différend a trait à la violation alléguée de
diverses obligations internationales sous l'effet de l'emploi de la force,
lequel revêt la forme de bombardements aériens des territoires de la You-
goslavie, bombardements qui sont imputés par le demandeur à l'Etat
défendeur. Il est évident que la violation alléguée de certaines obligations
par ce fait qui a un «caractère de continuité» s’est produite pour la pre-
mière fois au moment où le fait a commencé, c’est-à-dire des semaines
avant la date critique du 25 avril 1999. Comme les bombardements
aériens se sont poursuivis bien au-delà de la date critique et se poursui-
vent encore aujourd’hui, le temps de perpétration de la violation s'étend
sur la période entière durant laquelle ces faits continuent et ne prend fin
que lorsque les actes ainsi commis par l'Etat défendeur prennent fin ou
lorsque les obligations internationales qui seraient violées par les faits
dudit Etat cessent d’exister ou bien ne sont plus en vigueur pour ledit
Etat.

Il est possible de déduire de l’analyse ci-dessus que la limitation ratione
temporis figurant dans la formule de double exclusion adoptée par la
Yougoslavie dans sa déclaration d'acceptation de la juridiction obliga-
toire de la Cour n'empêche nullement celle-ci de fonder sa compétence
prima facie sur l'article 36, paragraphe 2, de son Statut, aux fins d’indi-
quer en l'occurrence des mesures conservatoires.

Il est regrettable qu'ayant abouti à des conclusions erronées sur ce
point, la Cour n'ait pas été à même d’indiquer aux Parties des mesures
conservatoires à appliquer dans une situation d'urgence marquée par le
drame humain, les pertes en vies humaines et les souffrances que connais-
sent les territoires de la Yougoslavie sous l'effet de l'emploi de la force
dans ce pays et contre lui.

En outre, face à cette situation d'urgence, la Cour aurait dû favoriser le
maintien de la paix et de la sécurité internationales dans la mesure où ses
fonctions judiciaires l’y autorisent. L'action de la Cour aurait été pleine-
ment justifiée en droit si, dès qu'elle a été saisie de la part du demandeur
de sa requête en indication de mesures conservatoires, et indépendam-
ment de son éventuelle conclusion quant à sa compétence prima facie
dans l'attente de sa décision définitive, elle avait lancé un appel de carac-
tère général aux Parties pour leur demander d’agir conformément aux
obligations leur incombant en vertu de la Charte des Nations Unies et de
toutes les autres règles du droit international intéressant la situation, y
compris le droit international humanitaire, et leur demander à tout le
moins de s'abstenir d’aggraver ou étendre leur différend. A mon sens, il
n'y a rien dans le Statut ni dans le Règlement de la Cour qui interdise à
celle-ci d’agir de cette façon. Aux termes de la Charte, la Cour est après
tout le principal organe judiciaire de l'Organisation des Nations Unies,
son Statut faisant partie intégrante de la Charte; et, sous l'effet des buts
et des principes de ladite Charte, y compris son chapitre VI (relatif au

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LICÉITÉ DE L'EMPLOI DE LA FORCE (OP. DISS. SHI) 208

règlement pacifique des différends), il a été attribué un rôle à la Cour
dans le cadre général de l'Organisation des Nations Unies aux fins du
maintien de la paix et de la sécurité internationales. Il ne fait aucun doute
que l'appel de caractère général dont je parle relève implicitement des
pouvoirs impartis à la Cour dans l'exercice de ses fonctions judiciaires.
Ayant aujourd’hui statué définitivement sur la requête du demandeur, la
Cour n'a pas saisi l’occasion qui lui était donnée d’apporter le concours
qu'elle aurait dû au maintien de la paix et de la sécurité internationales au
moment où ce concours est on ne peut plus indispensable.

En outre, dans la lettre qu’il a adressée au président et aux membres de
la Cour, l'agent de la Yougoslavie a dit ceci:

«Considérant le pouvoir conféré à la Cour aux termes du para-
graphe | de l’article 75 de son Règlement, et compte tenu de l'extrême
urgence de la situation née des circonstances décrites dans les de-
mandes en indication de mesures conservatoires, je prie la Cour de
bien vouloir se prononcer d'office sur les demandes présentées ou
de fixer une date pour la tenue d’une audience dans les meilleurs
délais. »

Dans une affaire très récente, l’affaire LaGrand, la Cour, sur la requête
de l'Etat demandeur et en dépit des objections de l'Etat défendeur, a
décidé d’exercer le pouvoir qui lui est ainsi conféré par le paragraphe 1 de
l'article 75 de son Règlement sans entendre l'Etat défendeur, ni par écrit
ni oralement (LaGrand (Allemagne c. Etats-Unis d'Amérique), ordon-
nance du 3 mars 1999, C.IJ. Recueil 1999, p. 13-14, par. 12, 21). Par
opposition, en l'espèce, la Cour n’a eu aucun geste positif à la suite de la
requête similaire formulée par l'agent de la Yougoslavie dans une situa-
tion dont le caractère d’urgence était même beaucoup plus prononcé que
dans l’exemple que je cite.

Ce sont ces motifs qui m'ont obligé 4 voter contre le paragraphe 51,
alinéa |, du dispositif de la présente ordonnance.

{ Signé) Sui Jiuyong.

88


79

DISSENTING OPINION OF JUDGE READ

I regret that I am unable to concur in the decision of the Court,
in this case, and that it has become necessary for me to indicate
the reasons which have prevented me from concurring with the
majority. As 1 am of the opinion that the Court should reject all the
Preliminary Objections, and deal with the merits, I must examine
all aspects of the case, and, in doing this, shall consider the following
questions:

First Question—The nature and scope of the dispute, as it now
presents itself to the Court.

Second Question—The Norwegian contention that “The subject of
the dispute as defined in the Application is within the domain
of municipal law and not of international law, whereas the
compulsory jurisdiction of the Court in relation to the Parties
involved is restricted, by their Declarations of November 16th,
1946, and March rst, 1949, to disputes concerning international
law;”.

Third Qüestion—The Norwegian contention that “As to that part
of the claim which relates to the bond certificates issued by the
Mortgage Bank of Norway and the Small Holding and Workers’
Housing Bank of Norway, these two Banks have a legal person-
ality separate from that of the Norwegian State; the action
cannot therefore be brought against that State as a borrower;
whereas moreover the jurisdiction of the Court is limited to
disputes between States ;”.

Fourth Question—The Norwegian contention that “The holders of
bond certificates for whose protection the French Government
considers itself entitled to institute international proceedings
have not first exhausted the local remedies.”

Fifth Question—The Norwegian request that the Court should
‘“‘adjudge and declare that the claim put forward by the Appli-
cation of the French Government of July 6th, 1955, is not
admissible’.

*

* x
First Question—The nature and scope of the dispute as it now
presents itself to the Court.

This is the fundamental question, because the conclusions
reached with regard to the matters in dispute depend almost
entirely on whether the controversy is looked at as it was in the
earlier stages of the case, or in the form which it has taken in the
course of the Written and Oral Proceedings.

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80 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

In the Application, the French Agent asked the Court to adjudge:
(x) that there was a real gold clause; -
(2) that the borrower can only discharge the substance of

his debt by payment of the gold value both of the coupons
and of the principal payments.

The Norwegian Agent considered that these requests related
solely to issues of Norwegian national law which the Court is
incompetent to adjudge in a case commenced by Application. But,
during the Oral Proceedings, the Final Submissions of the French
Government “On the Merits’ put forward three claims which
involved:

In paragraph 1
request for judgment by the Court that payment to foreign

holders of the bonds must be made without any discrimination ;
and

In paragraph 3
request for judgment by the Court that Norway cannot by

unilateral extraterritorial legislation modify the rights of the
French bondholders, without negotiation or arbitration; and

In paragraphs 2, 4 and 5
request for judgment based on the gold clause.

(It may be convenient to refer to the first two of these issues
as discrimination and extraterritoriality, respectively.)

It is obviously impossible to suggest that the Final Submissions,
raising these issues, relate to matters which are either exclusively
or essentially within the national jurisdiction of Norway. To meet
this position, the Norwegian Agent has urged the Court to reject the
Final French Conclusions. They have been attacked on the ground
that they give rise to a new claim.

The French Agent replied by citing the Chorzow judgment, and
by contending that “The intentions of the Statute are therefore
perfectly clear: it is possible to amend Submissions any time up
to the end of the proceedings.”

It is true that it has been the established practice of this Court,
and of the Permanent Court, to permit the Parties to modify their
Submissions up to the end of the Oral Proceedings. Indeed, the
President asked the Parties to file their Final Submissions before
terminating the Oral Proceedings; and, in so doing, he was follow-
ing a practice of long standing. Thus it was open to France to amend
the Submissions at that stage. But the right is subject to two
limitations. The first limitation is that, when there is an appreciable

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8x NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

change, the other Party must have a fair opportunity to comment
on the amended Submissions. In this case, the amendment was
made at the close of the French opening statement, and Norway
has had two opportunities to reply, of which full advantage has
been taken.

The second condition is that the amendment must be an amend-
ment. It must not-consist of an attempt by the Applicant Govern-
ment to bring a new and different dispute before the Court. If so,
the amended Submissions are not admissible, unless the new
elements have been incorporated in the dispute either by the Res-
pondent Government or by the two Governments in the course
of the Written and Oral Proceedings.

Accordingly, it is necessary to consider whether the allegedly new
elements—discrimination and extraterritoriality—raise a new
dispute, or whether they define the issues in the dispute which was
brought to the Court by the Application.

The Statute, by Article 40, imposes on the Applicant Government
the requirement that ‘‘the subject of the dispute and the Parties
shall be indicated”. It does not require that the issues shall be
defined; and, indeed, it makes it abundantly clear, by Article 48,
that the definition of the issues by Submissions is to be done in the
course of the Written and Oral Proceedings. (In this regard, the
French text of Article 48 shows that this is so, while the English
text is obscure.) Applications have usually contained statements.
of the issues involved; but these have been treated by this Court
and the Permanent Court as indications of the nature of the case.

it is in this light that the Application must be examined. Did it
sufficiently indicate the dispute as it has developed in the course
of the Written and Oral Proceedings, and as it has been formulated
in the French Final Submissions? In particular, did it sufficiently
indicate a dispute involving the two contested elements: discrimi-
nation and extraterritoriality ?

The Application gives particulars with regard to the different
issues of bonds involved. It sets forth, in a general way, the emer-
gence of the controversy between the French bondholders, repre-
sented by the National Association of French Security Holders,
and the Borrowers, the Norwegian State and the two Banks. It
mentions the formal intervention by the French Government on
behalf of its nationals in May, 1953, and subsequent negotiations.
between the Governments, which did not lead to a settlement. It
ends with the indication of the claim, as stated above.

It thus appears that the Application sufficiently indicated that
the case was intended to relate to the dispute which had been at
issue between the French Government and bondholders and the Nor-
wegian borrowers and Government for thirty years and twenty days.

That dispute had certainly been based on the three elements:
discrimination, extraterritoriality, and the existence and obligation.

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82 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

of the gold clause in the bonds. Nevertheless, the part of the Appli-
cation which purported to indicate the subject of the dispute was
obscure.

Norway takes the position that the words used in the Application
to indicate the subject of the dispute confined it to the existence
of the gold clause and the obligation of the bonds. France contends
that the two contested issues had been in controversy for more than
thirty years as essential elements of the dispute, and that the
actual claim as stated in the Application is broad enough to include
them. The claim reads:

“And that the borrower can only discharge the substance of his
debt by the payment of the gold value of the coupons on the date
of payment and of the gold value of the redeemed bonds on the
date of repayment.”

The obligation of the bonds depended on three things—the
contract, the law and the relevant legislation. The relevant statute
which had been under consideration by the two Governments was
the law of December 15, 1923. The two issues under consideration—
discrimination and extraterritoriality—were inseparably related
to that law. That this was so understood by Norway is plainly
indicated by the the fact that the text of the law was set forth in
the third paragraph of the Preliminary Objections, and subse-
quently treated as the cornerstone of the Norwegian case.

In these circumstances, I am compelled to accept the French
contention, and to reach the conclusion that the French Final
Submissions should not be rejected.

But, even if it is assumed that the claim, as stated in the Appli-
cation, is confined to the existence of the gold clause and the obli-
gation of the bonds, and that it did not include the contested
elements (discrimination and extraterritorial legislation), it does
not follow that the French Final Submissions must necessarily be
rejected. If the contested elements were incorporated into the dis-
pute by Norway alone, or by the two Governments, in the course
of the Written and Oral Proceedings, it would not be open to Norway
to complain at this late stage. In order to examine this aspect of
the matter, it is necessary to assume that the claim, as stated
above, must be construed as confined to the gold clause and
the obligation of the bonds, and as excluding the contested
elements.

Accordingly, and with that assumption in mind, I must examine
the way in which the allegedly new elements were brought into
the case. It will be seen that, from the beginning of the proceedings
in the Court, France based its pleadings and oral arguments on the
view that they had already been included in the Application. But
it will also appear that Norway understood that these contested
elements were an integral part of the merits of the dispute before
the Court. It will emerge that the request for rejection of the French

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83 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

Final Submissions is based on the extremely technical point that
the indication of the issues, as set forth in the Application, was so
badly drafted that it failed to disclose the real scope and extent
of the dispute as understood and developed by both France and
Norway. It will appear that Norway took such a dominant part
in the enlargement of the dispute in the course of the Written and
Oral Proceedings that it is not open to Norway to complain now by
raising the extremely technical point referred to above.

The actual dispute, on the governmental level, commenced with
the first French Note, dated 16 June, 1925, and included, together
with all the rest of the diplomatic correspondence, in the Memorial.
This Note, which was concerned with the claims of French holders
of bonds of the Mortgage Bank of Norway, raised the two issues: dis-
crimination and extraterritoriality. The Norwegian reply took the
form of the Note, dated g December 1925, transmitting a letter
from the Mortgage Bank defending its position. This letter questioned
the gold clause. It admitted the fact of discrimination in favour
of Swedish bondholders and against the French, defending it as
being based on good will. It dealt with extraterritoriality as
follows:

“The question has in all cases been determined by reference to the
Law of December 15th, 1923. In accordance with this Law, if the
creditor refuses to accept payment in Bank of Norway banknotes
at their nominal gold value, the debtor may claim postponement
of the payment for as long as the Bank is exempt from redeeming
its notes in gold at their nominal value.”

“The French Note states that a law of this kind can only apply
to nationals and not to foreign bondholders. This, however, is a
view which cannot be maintained. In any event the question would
naturally fall to be decided by a Norwegian Court in accordance
with Norwegian legislation and in accordance with Norwegian law
and it is quite clear that the decision would be binding on all
concerned.”

Accordingly, for more than thirty vears, the controversy was
based on the three main elements: discrimination, extraterritoriality
and the problem of interpretation and obligation arising out of the
gold clause.

Then came the Application, which is being considered upon the
assumption that it must be construed as cutting down the contro-
versy to a single issue. I am reluctant to adopt a narrow and
restrictive interpretation of the words used in the Application, in
aid of a highlv technical argument designed for the sole purpose
of preventing justice from being done. Nev ertheless, I must proceed
on the assumption that the narrow and restrictive interpretation
is right, and consider what happened in the course of the treatment
of the issues by the Parties.

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84 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

As might have been expected, France proceeded to deal with the
case asif the controversy had continued, uncurtailed by the Appli-
cation and including the contested elements. The case was dealt
with in the Memorial by raising and discussing the issues which are
now embodied in paragraphs 2, 3, 4 and 5 of the French Final
Submissions. As regards paragraph 3, the extraterritorial point,
it was summed up in a sentence:

“The question which arises may therefore be simply put in the
following way: can a debtor State, by means of an internal law
providing for the currency of unconvertible banknotes, alter the
substance of its external debt ?”’

The issue dealt with in paragraph 1 of the Final Submissions,
discrimination, was mentioned in the Memorial, and fully argued
in the Observations and Submissions. All of the issues, as set forth
in the Final Submissions, were fully argued in the Reply and in the
course of the Oral Proceedings.

There was, at first, some difference in the course followed by
Norway. I have already pointed out that Norway, in paragraph 3
of the Preliminary Objections, set forth the text of the Law of
December 15, 1923, which became the cornerstone of its case.
Later, in paragraph 29, in discussing the legal basis of the course
followed by Norway, it was stated that “it was the Law of Decem-
ber 15, 1923, which was applied”. But in taking the “First Objec-
tion”, Norway limited that objection to ‘‘the dispute, as defined in
the said Application”, and put forward arguments which could have
no relevancy except on the assumption that the actual controversy
had been curtailed by the Application so as to exclude the contested
elements, discrimination and extraterritoriality.

It was the Counter-Mernorial, the Rejoinder and the oral argu-
ments by Norway that brought about the fundamental change in
the scope of the dispute. For, assuming the curtailment of the
controversy by the wording of the Application, its enlargement so
as to include the contested elements was indeed a fundamental
change.

The Counter-Memorial devoted nearly three pages to a discussion
of the legal aspects of discrimination; and eleven pages to a much
more important issue. Norway put forward the argument that the
action of the Norwegian legislature in enacting the Law of Decem-
ber 15, 1923, and other relevant laws was justified by the historical
background. That background was one of world-wide economic
catastrophe: a sort of universal bankruptcy. The argument was
that Norway, in the special circumstances, was justified in sus-
pending gold payments, or the payment of gold equivalents. That
justification necessarily involved a correlative obligation to give
equal treatment to all creditors involved.

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85 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

The Rejoinder carried the arguments bearing directly on the
questions of discrimination and extraterritoriality even further. It
developed the argument based on the practice of States in dealing
with economic catastrophe bv fiscal measures. It brought into the
case entirely new considerations: the principles of international
law concerning ‘‘national treatment” of aliens, and the system of
the “minimum” or “international standard”. As in the case of the
argument based on State practice, these principles necessarily
involve the problem of discrimination and bear directly on the
extent of the Norwegian legislative power. The extent to which
the Rejoinder goes in enlarging the scope of the issues is indicated
by the fact that one hundred and thirty-four pages of the two
volumes are devoted to these aspects of the case.

In the Oral Proceedings, the same trend was observed. The
Norwegian Agent and Counsel devoted a very large proportion
of their time to the discussion of the two issues which the Agent
now asks the Courts to strike out of the case. One of the Counsel
went so far as to devote the whole of his time to one of them.

In these circumstances, I am of the opinion that the French
Final Conclusions do not go beyond the limits of the dispute in the
form which it took in the course of the Written and Oral Proceed-
ings; and that the responsibility for any enlargement of the dispute
which may have taken place since the Application is mainly due
to Norway. At any rate, Norway certainlv shared that responsibility
with France. It is not open to Norway, at this stage, to complain
about this enlargement.

Second Question—The Norwegian contention that “The subject
of the dispute as defined in the Application is within the domain
of municipal law and not of international law, whereas the
compulsory jurisdiction of the Court in relation to the Parties
involved is restricted, by their Declarations of November 16th,
1946, and March Ist, 1949, to disputes concerning international
law;”

This question was dealt with in two parts by Norway. In the first
part it was discussed upon the assumption that it was being put
to the Court for its decision. The second part deals with a subsidiary
aspect of the question in which the Court is being asked to deal
with it not on the basis of its own decision, but by merely registering
a decision of the Norwegian Government automatically ousting
the jurisdiction of the Court.

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86 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)
First Part

This question is confined to ‘the dispute as defined in the
Application”. It does not relate to the controversy as it existed
between the two Governments in the thirty years preceding the
Application or to the issues as discussed and dealt with by France
and Norway in the course of the Written and Oral Proceedings.
It has nothing to do with the subject-matter of the dispute as set
forth in the French Final Submissions. It is not in any sense relevant
to the actual case which is now before the Court. It is included in
the Norwegian Final Submissions and it represents a position
which has been maintained at all stages by Norway, in which the
arguments have been qualified and restricted to the dispute as
defined in the Application.

In dealing with the First Question I have taken the position that
the French Final Conclusions should not be rejected, and it neces-
sarily follows that I am of the opinion that the Second Question,
the point which was raised in the first Preliminary Objection, has
no relevancy at the present stage. The actual question as it existed
when the point was first taken was of a substantial character, but
the objection that the dispute was within the domain of municipal
law and not of international law has been maintained in relation
to the present position of the case.

The objection involves the very nature of the case and cannot
be considered effectively without touching upon the merits. I do
not propose to give my views with regard to the merits, but it is
necessary for me to look at the merits in order to determine the sort
of issues which they raise—i.e. whether they are issues of national
law or of international law or both. I must consider the problem
presented by this objection from three different aspects:

First Aspect: That the issue submitted by the Application is
purely a matter of national law and does not raise any issue of
international law.

This is the heart of the first Preliminary Objection. If the bond
contracts operated under international law, or if, either originally or
at a later stage, they gave rise to international obligations due
from Norway to France, it would no longer be possible to suggest
that the dispute was based solely on municipal law.

At the early stages of the transaction, the position is reasonably
clear. When the French bondholder bought a Norwegian bond,
there were only two parties to the executory contract which came

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into being—the bondholder and the Norwegian borrower, either
the State or one of the two Banks. The Government of France
had no part in the transaction. It was made under national law
and there was possible conflict between the different laws involved,
French, English and Norwegian. The determination of which Jaw
controlled any particular aspect of the matter was a problem to be
resolved by the law of the forum in which the suit was brought.
The court would apply the rules of private international law which
governs the choice of law, and then apply the chosen law to the
issues before it. Those rules and the chosen law would both be
national, and not international, law.

At this stage the transaction came solely within the plane of
national law. It would therefore be a matter in which the Court
was incompetent to adjudicate, and in which it would be necessary
if dealing with the Merits to say that there were no rules of inter-
national law governing the transaction. It would not be open to
this Court to decide upon the issues of choice of law, of interpretation
of the contract, or of the extent of its obligation.

The next stage was when France undertook diplomatic action
as a result of the suspension by Norway of payment in gold or in
gold equivalents in pursuance of the provisions of the law of 1923.
There is a difference between France and Norway as to the date
of the adoption of the dispute by the French Government, but
that is unimportant.

France claims that the adoption of the position of the French
bondholders by the French Government—the assertion by France
to Norway of the French views as to the obligation of the bonds,
and the refusal by Norway to concur and act accordingly—trans-
formed this dispute from one between private individuals and the
Norwegian borrowers into one between France and Norway, but
something more is needed than the mere adoption of a dispute
under the national law to give rise to a ‘‘question of international
law’ within the meaning of the expression as used in Article 36;
paragraph 2, clause (0). There must have been a breach by Norway
of an obligation under international law due to France.

Norway contends that the dispute as set forth in the Application
remained a dispute under the national law of Norway with which
this Court cannot deal. But I have already suggested that the
Application, properly construed, was broad enough in its terms to
raise those aspects of the problem which consist solely of questions
of international law, and I have also indicated that in my opinion
the issues are now settled, not by the wording of the Application
but by the wording of the Final Submissions of the Government

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of the French Republic.

In the French Final Submissions, “On the Merits’, the first
paragraph clearly raises the question of discrimination, and the
third paragraph raises the question of whether Norway could, in
conformity with the principles of international law, by legislative
action unilaterally modify the substance of the contracts between
Norwegian borrowers and French bondholders.

In these circumstances, there can be no doubt that questions of
international law are involved and that the Court is competent to
deal with the claim submitted to it. At any rate, there can be no
serious question as to its competence as regards the claim based
on discrimination and as regards the claim based on the law of
December 15th, 1923.

Second Aspect: That Norway discriminated against the French
bondholders and in favour of the Danish and Swedish bond-
holders.

I have already referred to this question in dealing with the First
Question, and have mentioned it in discussing the First Aspect
above. It is, howevér, necessary to develop it further and to
examine the grounds on which Norway has sought to justify the
discrimination.

The fact of discrimination is beyond question, but Norway
arÿues that there were times when the French bondholders were
more favourably treated than the Danes and Swedes. But two
wrongs do not make a right, and in my opinion the question of
balance of advantage is irrelevant.

Further, I cannot help thinking that the payment in Swedish
crowns involved very substantial discrimination. One thing is
certain, and that is that on the 23rd December, 1946, a proposal
was submitted by France for a settlement of the case, which had
then been a sore spot in Franco-Norwegian relations for twenty-one
years. This proposal was in the nature of a compromise, asking that
the French bondholders should be paid in Swedish crowns on their
capital payments, and that the coupons should be paid in Norwegian
crowns. The Norwegian Government did not even answer this
proposal.

Norway also questions the existence of a rule of international law
requiring equality of treatment, but that is a matter of merits.
What must be borne in mind now is that the question as to whether
such a rule of international law existed was certainly a ‘question of
international law’ within the meaning of Article 36.

Norway relies strongly on the argument that discrimination was
justified because it was based on good-will. It is not clear whether
‘it was good-will towards the Danish or Swedish investors or towards
Denmark and Sweden. This question of good-will has been repeat-

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edly raised and discussed by Norway, commencing on the gth Decem-
ber, 1925, but its meaning and significance are still obscure. There
is no suggestion that the refusal to accord the same sort of treatment
to France or to the French investors was based on ill-will, and I
cannot believe that the argument intends to suggest that inter-
national law considers that discrimination, if based on either
good-will or ill-will, ceases in some mysterious manner to be dis-
criminatory. At any rate, the question whether good-will can
justify discrimination is a matter of international law and not
of the national law of the respondent State.

Norway also argues that the payments to the Swedish bond-
holders were ex gratia, and therefore not a proper subject for
complaint by France. This argument is based upon the assumption
that the French bondholders had no legal right to get anything
better than Norwegian crowns (or sterling or francs), and that they
had no right to receive gold or gold equivalents. But that is begging
the question, and the objections to the jurisdiction must be dealt
with upon the assumption that the Applicant’s contentions with
regard to the merits are justified and that the Respondent’s conten-
tions with regard to the merits are wrong. The case must be considered
on the assumption that the bonds contained a real gold clause
binding on Norway.

It is, of course, true that this question of discrimination has
been an important element in the controversy for thirty-two years,
but it has been imported into dispute before this Court largely by
reason of the justification on which Norway relies for its action in
enacting the law of December 15th, 1923, and in establishing the
cours forcé and impairing the obligation of the bonds. That is a
point which I shall deal with more fully in discussing the Third
Aspect. But the Norwegian action has been justified on the basis
of world-wide economic catastrophe in which Norway and other
States were compelled to take legislative measures impairing the
obligations of debtors within the country as regards both resident
and non-resident creditors. Such a justification obviously raises
the question as to whether international law, if it sanctions such a
course, permits it where the State in question is discriminating
between different classes of creditors.

I do not need now to express any opinion on this question of
justification, but I have no doubt that it involves questions of
international rather than of national law.

Third Aspect: The French contention that the enactment by Norway
of extraterritorial legislation purporting to impair the obligations

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due to foreign bondholders resident in France was contrary to
international law.

This contention was raised in the French Final Submissions “On
the Merits’, paragraph 3. In the course of the controversy, and
throughout the written and oral proceedings, France has developed
two main arguments along these lines. The first argument is based
upon the view that international law treats the obligations arising
from the marketing of bonds abroad as being something more than
obligations arising under national law. Where, as in this case, the
bonds have been:

marketed abroad;

(1)
(2) expressed in several currencies;
(3)

)

3) payable abroad;
(4) expressed in several languages;

it is argued that they cannot be repudiated without giving rise to
a breach of international law.

France contends that this position is supported by the practice
of States as indicated by the arbitrations in such matters, especially
in the closing years of the last century and the early years of this
century, and reliance is also placed on Article 1 of the Hague
Convention of 1907. The terms of this Convention were at first
put forward as establishing a legal obligation to submit to arbitration
in the matter of the recovery of contract debts. But this position
has been abandoned, and in the later stages France was relying
on the Convention as establishing the nature and character cf the
obligation arising out of contract debts claimed from the Govern-
ment of one country by the Government of another country as
being due to its nationals.

The French position was contested in all its phases by Norway.

The second French contention arises out of what has been
referred to as the special French doctrine with regard to govern-
mental action within a State impairing the obligation of debts due
to non-resident aliens. It is contended by France that this doctrine
expresses a broad principle of international law which would
prevent a State from enacting extraterritorial legislation impairing
the contractual rights of non-resident aliens. The French argument
is based largely on this being a general principle of law recognized
by civilized nations, and it is countered by the argument put
forward on behalf of Norway, which is of a two-fold character—
Norway relies largely on the practice of States, and also on the rule
of the minimum standard.

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It will thus be seen that the French claim and the Norwegian
justification in this aspect of the question are both based upon
considerations of international law and have nothing whatever to
do with national law.

It is, of course, impossible for me at the present stage to indicate
my views as to whether France or Norway is right, whether the
matter is considered from the point of view of discrimination or of
extraterritoriality. On the other hand, I find insuperable difficulty
in reaching the conclusion that a case involving these issues can be
treated as being solely one of national law; and I am forced to
the conclusion that the first Preliminary Objection should be
rejected.

Second Part

In the Preliminary Objections, after arguing that the subject of
the dispute as defined in the Application was within the domain of
municipal law and not of international law, Norway considered that
there could be no possible doubt on this point. If, however, there
should still be some doubt, the Norwegian Government intimated
that it would rely upon the reservation made by the French
Government in its Declaration of March Ist, 1949. After discussing
this Declaration, it was stated that ‘‘convinced that the dispute
which has been brought before the Court by the Application of
July 6th, 1955, is within the domestic jurisdiction, the Norwegian
Government considers itself fully entitled to rely on this right”.

In invoking the provision contained in the reservation to the
French Declaration, which provided for the automatic ouster of the
jurisdiction by the unilateral action of the respondent Government,
Norway was exercising a right of a highly technical character, and
the question naturally arises whether there was complete compliance
with all of the provisions of the Declaration. The reservation
reads as follows:

“This Declaration does not apply to disputes relating to matters
which are essentially within the national jurisdiction as understood
by the Government of the French Republic.” (The translation of
the French original has been changed by substituting the word
“disputes” for “differences” in order to bring the English text into
harmony with the French text.)

Norway, in putting forward this highly technical objection, did
not make any statement or give any evidence indicating that this
dispute related to matters which are essentially within the national
jurisdiction as understood by the Norwegian Government. It made
a bald statement that it was convinced that the dispute was “within
the domestic jurisdiction’’, which is quite a different matter. There

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never at any time has been any question about the dispute being
within the domestic jurisdiction of Norway. The real question has
been whether the dispute was not also and primarily a matter to be
determined not by the Norwegian law but by international law.
However, Norway made it plain enough that it desired to invoke
the French Declaration.

I have refused to apply any rigid and purely literal interpretation
to the Application and have insisted that it should be interpreted
so as to give effect to what obviously was the intention of France
and the understanding of Norway. It would be completely incon-
sistent for me to seek to apply a rigid and purely literal interpre-
tation to the words used by Norway when it sought to invoke the
French Declaration. Accordingly, I am compelled to reach the
conclusion that Norway did effectively invoke the French Decla-
ration when the point was taken in the Preliminary Objections.

On the other hand, I do not think that Norway has maintained
its position in this regard.

Having purported to invoke in the Preliminary Objections the
reservation contained in the French Declaration, Norway did not
incorporate this subsidiary point in its actual Submission. Indeed,
the actual Submission relating to the first Preliminary Objection
was inconsistent with the notion embodied in the Declaration. It
asked the Court to find that the subject of the dispute was within
the sphere of municipal law and not of international law, while the
reservation envisaged a position in which that was not to be
decided by the Court, but by the understanding of the Norwegian
Government.

The point was not mentioned by Norway in the Counter-Memorial,
in the Rejoinder or in the Oral Proceedings. Further, in the Nor-
wegian Final Submissions of May 23rd—‘‘On the Preliminary
Objections’ —the Court is asked to make a finding that “1. The
subject of the dispute, as defined in the Application, is within the
domain of municipal law and not of international law.” This
actual Submission by Norway is inconsistent with the maintenance
of the position taken in the Preliminary Objections when the French
Declaration was invoked. Here again, the formal request that the
Court should make this finding is utterly inconsistent with the
idea the decision should be made by Norway and not by the Court.

It might be thought that, notwithstanding the omission of
this point from the Norwegian Final Submissions, it was maintained
in the closing statements made on behalf of Norway during the
Oral Proceedings.

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At the beginning it was said, on behalf of Norway:

“In these circumstances, I should not like to take advantage of
the Court’s patience by repeating what we have already had the
honour to set forth in our oral arguments. We maintain our positions
in their entirety both as regards the merits and as regards the
Preliminary Objections.”’

It is clear that Norway here was maintaining the position which
had been taken in the course of the oral arguments and that no
reference was intended to any matter touched upon in the Written
Pleadings but not dealt with in the course of the Oral Proceedings.

Later, in dealing with the fourth Objection, which concerned
exhaustion of local remedies, it was stated:

“All that we have written and all that we have submitted orally
to the Court in regard to our fourth Objection therefore still stands.”

In this instance it was clearly intended, as regards the fourth
Objection, to maintain all positions which had been taken during
the Written Proceedings whether or not they had been maintained
in the course of the Oral Proceedings.

The final position was taken towards the end when it was said:

“The Norwegian Government maintains its Submissions in their
entirety as I presented them at the sitting on May 23rd...”

I have no doubt in my own mind that the Norwegian Agent and
Counsel realized that it was no longer proper to rely upon the French
Declaration. In view of the form which the dispute had taken in
the course of the Written and Oral Proceedings and especially
having in mind that Norway had used 134 pages in the Rejoinder
in arguing the international questions involved in the merits of the
dispute, it was no longer possible seriously to suggest that Norway
understood that the actual dispute before the Court related “to
matters which are essentially within the national jurisdiction as
understood by the” Norwegian Government.

It is true that Norway has not formally abandoned the course
which it adopted when it purported to invoke the reservation
contained in the French Declaration. Nevertheless, I am compelled
to reach the conclusion that Norway has not maintained that
position and that it is necessary to comply with Norway’s request
to deal with the case on the basis of the Norwegian Final Sub-
missions of May 23rd.

But even if I thought that Norway had maintained its Objection
based on the reservation to the French Declaration, I should still
have difficulty in accepting an objection to the jurisdiction of the
Court based upon the Second Part of the first Preliminary Objection.

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My first difficulty relates to the text of the Declaration. It is
necessary, for Norway to succeed, to establish that the Norwegian
Government understands that the dispute relates to matters which
are essentially within the Norwegian national jurisdiction. It is not
sufficient to establish that the Norwegian Government pretends to
understand, or declares that it understands that the dispute comes
essentially within the scope of Norwegian national law. The text
does not use the word “‘pretends’’ or ‘‘declares’” and it does use
language that suggests that it had in mind a genuine understanding.

When the provisions of the reservation were invoked by Norway,
it was not contended that they conferred an arbitrary power to
oust the jurisdiction of the Court. Norway took the position that
“should a Government seek to rely upon it with a view to denying
the jurisdiction of the Court in a case which manifestly did not
involve a ‘matter which is essentially within the national juris-
diction’ it would be committing an abus de droit which would not
prevent the Court from acting’.

I am in agreement with the position taken by Norway in this
regard, but I do not think that it goes quite far enough. A case
might involve a matter essentially within the national jurisdiction
and yet not come within the scope of “disputes relating to matters
which are essentially within the national jurisdiction’. Further, I
should be disinclined to bring notions of “good faith” and abus de
droit into the question. Practically speaking, it is, I think, impossible
for. an international tribunal to examine a dispute between two
sovereign States on the basis of either good or bad faith or of
abuse of law.

Nevertheless, I think that the basic principle underlying the
position taken. by Norway in this regard should be accepted.
© I think that the wording of the reservation to the Declaration
properly construed means that the respondent State, in invok-
ing the reservation, must establish that there is a genuine
understanding, i.e. that the circumstances are such that it would be
reasonably possible to reach the understanding that the dispute
was essentially national. Whether the circumstances are such is
not a matter for decision by a respondent Government, but by the
Court. But, assuming that such circumstances existed, the conclusion
reached by a respondent Government could not be reviewed by
the Court.

I am unable to accept the view that the reservation should be
interpreted as giving the respondent Government an arbitrary
power to settle any question of jurisdiction which arises by the
assertion that the Government understands that the matter is
essentially within the national jurisdiction regardless of whether
that assertion is true or false.

Such a construction of the clause would lead to something
unreasonable and absurd. It would, of course, if that interpretation

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is accepted, be necessary to conclude that the Declaration ran
contrary to Article 36, paragraph 6, of the Statute, and was null
and void.

But this interpretation runs directly contrary to the rule which
was laid down by the Permanent Court in the Polish Postal Service
in Danzig (P.C.1.J., Series B, No. rz, p. 39)°

“It is a cardinal principle of interpretation that words must be
interpreted in the sense which they would normally have in their
context, unless such interpretation would lead to something
unreasonable or absurd.”

This rule was approved in the Advisory Opinion of this Court:
Competence of Assembly regarding admission to the United Nations,
L.C.J. Reports 1950, at page 8.

If we apply the principles of this rule to the present case we
find that the relevant words in their natural and ordinary meaning
make sense in their context and that, in my opinion, is an end of
the matter. It is inadmissible, by a process of interpretation, to
rewrite the clause in question as if it had read: “disputes relating
to matters as regards which the Government of the French Repub-
lic has declared that it understands that they are essentially
within the national jurisdiction”. The words actually used, ‘‘as
understood”’, if given their natural and ordinary meaning, connote
a real understanding, and not a fictitious understanding unrelated
to the facts.

Having these considerations in mind, it is necessary for me to
examine the question whether the circumstances are such that it
would be reasonably possible to reach an understanding that the
dispute was essentially national.

At the time when Norway invoked the reservation there can be
no doubt as to the propriety of the action. At that time, it was
certainly reasonably possible, considering the Application alone
together with any light that had been thrown upon it by the
Memorial, to reach such an understanding. But, as a result of the
course taken in the Written and Oral Proceedings, it is now possible
tolook at the dispute with full knowledge of its essential character.
The dispute, in the form which it has now taken, and in which it is
expressed in the French Final Submissions, involves a threefold
claim based on: discrimination, extraterritoriality and the gold
clause. The first two are based solely on international law while
the third is based primarily on national law. I have already pointed
out that throughout the Written and Oral Proceedings, the first
and the second claims have been discussed at great length by France
and at much greater length by Norway. In these circumstances,
I find it impossible to reach the conclusion that Norway could have
reasonably understood that the case was essentially within the
Norwegian national jurisdiction.

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Accordingly, having considered both the First Part and the
Second Part, I have reached the conclusion that the first Nor-
wegian Preliminary Objection, as embodied in the first recital
to the Submissions of the Agent of the Norwegian Government on
May 23rd, 1957, should be rejected.

*
* *

Third Question—The Norwegian contention that “As to that part
of the claim which relates to the bond certificates issued by the
Mortgage Bank of Norway and the Small Holding and Workers’
Housing Bank of Norway, these two Banks have a legal person-
ality separate from that of the Norwegian State; the action
cannot therefore be brought against that State as a borrower ;
whereas moreover the jurisdiction of the Court is limited to
disputes between States;’’.

I cannot accept the Norwegian contention as regards these
Banks. I agree that they have separate legal personalities distinct
from that of the Norwegian State, but that does not wholly dispose
of the matter.

The record shows that in 1954 a bondholder brought an action
against the Mortgage Bank of Norway in a French court, the Tribunal
de la Seine. The Bank objected to the jurisdiction of that Court
on the ground that it was an instrumentality of the Norwegian
Government, and for that purpose furnished the court with a
certificate, signed by the Minister of Finance of Norway and dated
28th December, 1931, to that effect. It is established that the Bank,
both in the matter of the litigation and in the course followed as
regards gold payments, payments in Swedish crowns, and other
matters in dispute, was not acting as a separate personality with
a separate power of decision, but was acting on the basis of the
advice, instruction and approval of the Minister of Justice of
Norway and the Minister of Finance of Norway. This has been the
case since the gth December, 1925, as is proved by Annex V to the
Memorial. The proceedings in the French court were concluded in
March, 1956, by a default judgment owing to the unwillingness of
the Bank to appear and contest the proceedings on the merits,

It thus appears that the Norwegian State completely identified
itself with the Bank for the purpose of preventing the bondholder
from obtaining a judicial determination of his rights. It is a sound
doctrine that a party cannot blow both hot and cold at the same
time, and Norway cannot retreat from the position of complete
identification taken in 1931, and persisted in in the proceedings
before the French court, for the purpose of preventing this Court
from adjudicating upon the matter.

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*
* *

Fourth Question—The Norwegian contention that “The holders
of bond certificates for whose protection the French Government
considers itself entitled to institute international proceedings
have not first exhausted the local remedies.”

From the very commencement of the diplomatic negotiations
up to the present time, Norway has consistently and persistently
insisted that the bondholders should resort to the Norwegian courts
for the purpose of having these courts interpret the clauses in the
bonds and determine the nature and extent of the obligations to
the borrowers thereunder. But, at the same time and just as
consistently and persistently, Norway has asserted that the question
has been governed by the law of 15th December, 1923, and that
that law is applicable to and binding upon foreigners. I have
quoted above the actual statement by Norway, made at the
commencement of the controversy.

The rule of international law requiring the exhaustion of the
local remedies is of great importance. When a State adopts the
cause of its nationals as against a respondent State in a dispute
which originally was one of national law, it is important to obtain
the ruling of the local courts with regard to the issues of fact and
law involved, before the international aspects are dealt with by an
international tribunal. It is also important that the respondent
State which is being charged with breach of international law
should have a fair opportunity to rectify the position through its
own tribunals. It is necessary to begin the consideration of the
fourth Preliminary Objection with the assumption that France
must establish resort to an exhaustion of local remedies before the
claims of the French bondholders can be submitted to this Court.

France has put forward three reasons for not resorting to the
domestic tribunals in this case.

In the first place, France suggests that the rule with regard to
the necessity for exhaustion of local remedies is limited to cases in
which the aggrieved individuals have taken up residence within
the jurisdiction of the respondent Government and thus consented
to the exercise by the tribunals of that country of jurisdiction over
them.

France has not been able to put forward any persuasive authority
for accepting this limitation on the application of the rule and,
indeed, the weight of authority is the other way.

In the second place, France also contends that the proper law
of the contract is French and that the proceedings could be under- .
taken in the French courts. But this is a matter of private inter-
national law on which I do not propose to express any opinion.
It is not directly relevant to the application of the rule of exhaustion
of local remedies which, as a rule of public international law, is

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concerned with the exhaustion of remedies available in the respon-
dent State.

In the third place, France contends that the bondholders should
be excused from having undertaken proceedings in the Norwegian
courts because such proceedings would offer no reasonable prospect
of establishing their rights.

Here we must again draw a clear-cut line between the original
dispute based on national law and the dispute before this Court
which is based upon international law. In this Court, the main
complaints against Norway on the international plane are:

1st—discrimination ;
2nd—extraterritoriality ;
3rd—the gold clause issue.

The bondholder could not possibly bring proceedings in the
Norwegian courts with regard to the first or the second issues. His
only course of action was a suit for breach of contract.

The question, therefore, is whether the bringing of an action in
the Norwegian courts by a French bondholder is a course which
could be reasonably expected of him, or whether it would have been
a procedure of obvious futility.

I have difficulty in reaching the conclusion that the bondholder
could reasonably have been expected to bring proceedings in the
Norwegian courts. Since gth December, 1925, he has had the notion
hammered into his head by the Norwegian Government that such
a course would be futile because the matter was governed by the
law of 15th December, 1923. If he had brought an action and had
persuaded the Norwegian court that there was a real gold clause
in his bond, he would have met an insuperable barrier in the law of
1923. It would have been in vain for him to have argued that the
enactment of that law was contrary to the rules of international law.

It has been suggested in the Oral Proceedings that he might have
asked the court to do one of two things—namely, to interpret the
law as being inapplicable to foreigners, or to hold that the law was
unconstitutional by reason of its retroactive character. But the
French bondholder had never heard of these possibilities, neither
of which was suggested at any time in the course of the diplomatic
negotiations or in the course of the negotiations which took place
between the French National Association and the Mortgage Bank.

In the fourth place, it has been argued that the rule with regard
to exhaustion of local remedies has no application where the rights
of the applicant national have been impaired by the direct inter-
vention of the respondent Government or Parliament. If there ever
was a case in which the respondent Government and Parliament
had intervened to impair the rights of non-resident aliens, it is in
the present instance. It is obvious from the terms of the Note of
gth December, 1925, that the Mortgage Bank was not acting under

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its own motion but under pressure from the Minister of Justice
and the Minister of Finance. Further, the Storthing, the supreme
legislative authority, in enacting this law was directly intervening
so as to impair the rights of the French bondholders. Here I am
not suggesting that either the Minister of Justice, the Minister of
Finance, the Norwegian Government or the Storthing adopted and
followed any course that was improper, but when I am dealing
with an objection to the jurisdiction { am compelled to assume as
against Norway matters which might well be changed on considera-
tion of the merits.

In view of these circumstances I find difficulty in upholding the
fourth Norwegian objection, and am led to the view that it should

be rejected.

*
* %

Fifth Question—The Norwegian request that the Court should
“adjudge and declare that the claim put forward by the Appli-
cation of the French Government of July 6th, 1955, is not
admissible’.

I have already given my reasons for thinking that the claim of
the French Government, with which the Court is now dealing, is
the claim as set forth in the French Final Submissions. In a sense
therefore, the Fifth Question is hardly relevant. But, construing the
question as relating to the claim before the Court, I am of the
opinion that it is not inadmissible. To appreciate the position, it is
necessary to bear in mind that there are three complaints before
the Court.

The first is the charge by France that Norway discriminated
against the French bondholders, contrary to the rules of international :
law. This charge, which I have been calling ‘discrimination’, is for-
mulated in the first paragraph of the French Submissions on the
merits.

The second is the charge by France that Norway, by unilateral
action in violation of the rules of international law, enacted legis-
lation impairing the obligation of the bonds, to the detriment of the
French investors. This charge, which I have been calling ‘‘extra-
territoriality”, is formulated in the third paragraph of those
Submissions.

These elements of the dispute are causes of action which, in my
opinion, are admissible. This Court alone is competent to dispose
of them, They cannot be referred to the Norwegian courts, because
those courts are not competent to dispose of a dispute, under
international law, between France and Norway. The complaints, as
regards discrimination and extraterritoriality, do not touch the
breach of any legal obligation owed by Norway to the French
bondholders. They relate solely to the obligations imposed on
Norway by international law vis-d-vis France.

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100 NORWEGIAN LOANS (DISS. OPIN. OF JUDGE READ)

The third complaint is that which concerns the existence and
obligation of the gold clause. It is based on the law of contract, and
the contract, in this instance, is governed by Norwegian national
law and not by international law. This complaint is formulated in
the second, fourth and fifth paragraphs of the French Submissions
on the merits. This element of the dispute is a cause of action which,
in my opinion, is inadmissible. It is a matter that is and was within
the scope of the jurisdiction of the Norwegian courts, in suits by
the French bondholders against the Norwegian borrowers. France
could not, by adopting the claims of French nationals, change the
legal nature of the claims, and transfer them from the national
to the international plane.

I do not think that the jurisdiction of the Norwegian courts to
deal with the contractual cause of action, the third complaint under
consideration, is in any way Impaired by the existence of the first
and second complaints which they are not competent to adjudicate.
That is so notwithstanding that the three elements are so closely
related. But, at the same time, I am of the opinion that the compe-
tence of this Court to adjudge the two purely international elements
is not ousted, by reason of the coexistence of a closely related, but
severable, element which is within the exclusive national competence
of Norway.

Accordingly, I have reached the conclusion that the Court
should reject the Norwegian objections in so far as they relate
to the first and third paragraphs of the French Submissions on the
merits; and allow the Norwegian objections in so far as they relate
to the second, fourth and fifth paragraphs thereof.

Norway has asked the Court, in the Submissions of May 23rd,
1957, to deal with the merits. This is a conditional request, which
would come into operation only if the Court decided that the claim
was admissible. As the Court is taking the position that it is not
competent to deal with any part of the dispute, it is not desirable
that I should proceed to discuss the merits, although my own view
is that they should be dealt with in so far as they relate to the first
and third paragraphs of the French Submissions. In dealing with
the points of jurisdiction and admissibility, it has been necessary
for me to look at the merits from time to time, and to make certain
observations with regard to them. It was not intended in making
these observations to indicate in any way what my opinion would
be in the event that it became necessary to consider and dispose
of the merits.

(Signed) J. E. Reap.

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