award. Department decisions suggest at least that actions to compel a commercial arbitration should be deemed to be claims based on a commercial activity (see Nos. 45 and 73).

Diplomatic Considerations. As a government agency charged with the day-to-day conduct of foreign relations, the Department was of course cognizant of diplomatic considerations which were raised in connection with individual sovereign immunity claims. For the most part, diplomatic influences were resisted. In those cases where diplomatic concerns appeared to have an effect (e.g., Nos. 32, 41, 69, 86), it is difficult to ascertain the precise role which those concerns played. By transferring to the courts responsibility for deciding claims of immunity, the Act should remove this factor as a hidden influence on future decisions. See House Rep. No. 94-1487, 94th Cong., 2d Sess. 7, 9 (1976).

Sources and Methods

The cases reported below cover all diplomatic requests for sovereign immunity, and Department decisions in response to those requests, that could be gleaned from a search of Department of State and Department of Justice files. While no assurance can be given that the list is

3

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The materials omit the diplomatic requests in the following cases, which were not acted on by the Department either because the request was withdrawn, because it was not pursued by presenting a memorandum or additional facts in support of the request, or because the case was settled:

No. 35. Olavaria y Cia. v. Banca para el Commercio, Civil Action No. 61-3825 (Sup. Ct., San Juan, P.R. 1962) (Diplomatic request from the Czechoslovak Ambassador on behalf of the Republic of Cuba).

'No. 70. Paterno v. Norway, Civil Action No. 69-H-130 (S.D. Tex. 1969) (Diplomatic request: December 22, 1970).

No. 72. Heaney v. Government of Spain, 445 F.2d 501 (2d Cir. 1971) (invitation from the court to submit views).

No. 76. Grofer v. Government of Jamaica, Civil Action No. 38102 (E.D. Mich.) (Diplomatic request: May 16, 1972).

No. 83. Marine Transport Lines, Inc. v. The Turkish Government, 72 Civ. 3703 RJW (S.D.N.Y.) (Diplomatic request: January 22, 1975).

No. 89. Manufacturas Sumar, S.A. v. M/V William Foster, Civil Action No. 7910 (D.C.Z.) (Diplomatic request from the Soviet Embassy: October 30, 1973). No. 90. Moore v. FFV Sport, Inc., Kingdom of Sweden, et al. (Sup. Ct. .N.J., County of Orange) (Diplomatic request: November 2, 1973).

No. 91. Alora Compania Naviera S.A. v. Embassy of the Philippines (S.D.N.Y.) (Diplomatic request: November 20, 1973).

No. 98. Nalvandian, et al. v. Her Majesty The Queen in Right of the Dominion of Canada, No. 4726-27 (E.D. Mich.) (Diplomatic request: September 5, 1975). No. 105. Cross & Brown Company v. Republic of Zaire, Index No. L&T 17774/ 76 (Ct. City N.Y., County N.Y. 1976) (Diplomatic request: March 17, 1976). No. 109. Panama Canal Company v. Compania Nacional de Navegacion, Civil Action No. 76-3111 (E.D. La.) (Diplomatic request from the Embassy of Colombia: October 26, 1976).

complete, all diplomatic requests for immunity which were located have been included.

Virtually all Department determinations with respect to immunity have been expressed in diplomatic notes or in letters to the Attorney General. In cases where the Department declined to recognize immunity, the portions (if any) of the Department's note indicating the reasons for the decision, or the facts relied on, are quoted. Other portions of the note are generally not quoted, unless they appear to have some bearing on the decision.

In cases where the Department recognized immunity, the same procedure outlined above was followed. However, very often no indication was given as to why immunity was recognized, except for a customary conclusory statement such as "the Department recognizes and allows immunity and requests the Attorney General to cause an appropriate suggestion of immunity to be filed." In such cases, the letter to the Attorney General is often not quoted.

Beginning in the late 1960's when Department procedures became more detailed, other materials were developed which, in a few cases, shed light on the Department decision that was ultimately expressed in a diplomatic note or in a letter to the Attorney General. Such materials have been quoted or described where applicable and appropriate. Although not incorporated into the final document of decision (the diplomatic note or letter to the Attorney General), such materials may be of some interest.

Many of the cases referred to have been reported elsewhere, and the citations are noted. Where cases reported elsewhere fully duplicate the material that would otherwise be presented here, such material is not repeated here. However, available material not reported elsewhere has been included.

The documents which are quoted in the following case reports may be found in Dept. of State File No. P78 0101-0328.

The Tate Letter

On May 19, 1952, the U.S. Department of State, in a letter of that date, signed by the Acting Legal Adviser (Jack B. Tate) and addressed to the Acting Attorney General (Philip B. Perlman), announced its policy of adhering to the so-called "restrictive theory' of sovereign immunity. The letter reads:

"A study of the law of sovereign immunity reveals the existence of two conflicting concepts of sovereign immunity, each widely held and firmly established. According to the classical or absolute theory of sovereign immunity, a sovereign cannot, without his consent, be made a respondent in the courts of another sovereign. According to the newer or restrictive theory of sovereign immunity, the immunity of the sovereign is recognized with regard to sovereign

or public acts (jure imperii) of a state, but not with respect to private acts (jure gestionis). There is agreement by proponents of both theories, supported by practice, that sovereign immunity should not be claimed or granted in actions with respect to real property (diplomatic and perhaps consular property excepted) or with respect to the disposition of the property of a deceased person even though a foreign sovereign is the beneficiary.

"The classical or virtually absolute theory of sovereign immunity has generally been followed by the courts of the United States, the British Commonwealth, Czechoslovakia, Estonia, and probably Poland.

"The decisions of the courts of Brazil, Chile, China, Hungary, Japan, Luxembourg, Norway, and Portugal may be deemed to support the classical theory of immunity if one or at most two old decisions anterior to the development of the restrictive theory may be considered sufficient on which to base a conclusion.

"The position of the Netherlands, Sweden, and Argentina is less clear since although immunity has been granted in recent cases coming before the courts of those countries, the facts were such that immunity would have been granted under either the absolute or restrictive theory. However, constant references by the courts of these three countries to the distinction between public and private acts of the state, even though the distinction was not involved in the result of the case, may indicate an intention to leave the way open for a possible application of the restrictive theory of immunity if and when the occasion presents itself.

"A trend to the restrictive theory is already evident in the Netherlands where the lower courts have started to apply that theory following a Supreme Court decision to the effect that immunity would have been applicable in the case under consideration under either theory.

"The German courts, after a period of hesitation at the end of the nineteenth century have held to the classical theory, but it should be noted that the refusal of the Supreme Court in 1921 to yield to pressure by the lower courts for the newer theory was based on the view that that theory had not yet developed sufficiently to justify a change. In view of the growth of the restrictive theory since that time the German courts might take a different view today.

"The newer or restrictive theory of sovereign immunity has always been supported by the courts of Belgium and Italy. It was adopted in turn by the courts of Egypt and of Switzerland. In addition, the courts of France, Austria, and Greece, which were traditionally supporters of the classical theory, reversed their position in the 20's to embrace the restrictive theory. Rumania, Peru, and possibly Denmark also appear to follow this theory.

"Furthermore, it should be observed that in most of the countries still following the classical theory there is a school of influential writers favoring the restrictive theory and the views of writers, at least in civil law countries, are a major factor in the development of the law. Moreover, the leanings of the lower courts in civil law countries are more significant in shaping the law than they are in

common law countries where the rule of precedent prevails and the trend in these lower courts is to the restrictive theory.

"Of related interest to this question is the fact that ten of the thirteen countries which have been classified above as supporters of the classical theory have ratified the Brussels Convention of 1926 under which immunity for government owned merchant vessels is waived. In addition the United States, which is not a party to the Convention, some years ago announced and has since followed, a policy of not claiming immunity for its public owned or operated merchant vessels. Keeping in mind the importance played by cases involving public vessels in the field of sovereign immunity, it is thus noteworthy that these ten countries (Brazil, Chile, Estonia, Germany, Hungary, Netherlands, Norway, Poland, Portugal, Sweden) and the United States have already relinquished by treaty or in practice an important part of the immunity which they claim under the classical theory.

"It is thus evident that with the possible exception of the United Kingdom little support has been found except on the part of the Soviet Union and its satellites for continued full acceptance of the absolute theory of sovereign immunity. There are evidences that British authorities are aware of its deficiencies and ready for a change. The reasons which obviously motivate state trading countries in adhering to the theory with perhaps increasing rigidity are most persuasive that the United States should change its policy. Furthermore, the granting of sovereign immunity to foreign governments in the courts of the United States is most inconsistent with the action of the Government of the United States in subjecting itself to suit in these same courts in both contract and tort and with its long established policy of not claiming immunity in foreign jurisdictions for its merchant vessels. Finally, the Department feels that the widespread and increasing practice on the part of governments of engaging in commercial activities makes necessary a practice which will enable persons doing business with them to have their rights determined in the courts. For these reasons it will hereafter be the Department's policy to follow the restrictive theory of sovereign immunity in the consideration of requests of foreign gov ernments for a grant of sovereign immunity.

"It is realized that a shift in policy by the executive cannot control the courts but it is felt that the courts are less likely to allow a plea of sovereign immunity where the executive has declined to do so. There have been indications that at least some Justices of the Supreme Court feel that in this matter courts should follow the branch of the Government charged with responsibility for the conduct of foreign relations."

XXVI Bulletin, Department of State, No. 678, June 23, 1952, dd. 984.985

DEPARTMENT DECISIONS 1952-1977

No. 1. Arias v. SS. Fletero and Cia. Argentina de Navegacion Dodero, Adm. No. 7492 (E.D. Va. 1952).

Diplomatic request (from the Ambassador of Argentina): May 7,

1952.

An action for injuries aboard a commercial vessel of an Argentine state-owned company. The Department, in a note dated May 22, 1952, denied the request of the Embassy of Argentina for immunity from suit, stating in part:

At the time your Excellency's note was received, there had been formulated in the Department for some time an overall policy decision on the question of sovereign immunity which was then in the process of receiving final clearance. Since it was not certain that such clearance would be given prior to May 14, 1952, the Department requested the Attorney General to instruct the United States Attorney for the Eastern District of Virginia to attempt to obtain a continuance of the trial for a reasonable length of time. The Department was in due course informed that the trial had been continued until May 23, 1952.

The policy decision referred to has now been cleared in the Department and communicated to the Attorney General. Under this decision, which is the result of a study over a considerable period of time of the law of sovereign immunity, the Department will no longer recognize and allow claims of sovereign immunity in certain types of cases.

A study of the law of sovereign immunity reveals the existence of two conflicting concepts of sovereign immunity. According to the classical or absolute theory of sovereign immunity, a sovereign cannot, without his consent, be made a respondent in the courts of another sovereign. According to the newer or restrictive theory of sovereign immunity, the immunity of the sovereign is recognized with regard to sovereign or public act (jure imperii) of a state, but not with respect to private acts (jure gestionis). There is agreement by proponents of both theories, supported by practice, that sovereign immunity should not be claimed or granted in actions with respect to real property (diplomatic and perhaps consular property excepted) or with respect to the disposition of the property of a deceased person even though a foreign sovereign is the beneficiary.

With the possible exception of the United Kingdom little support has been found except on the part of the Soviet Union and its satellites for continued full acceptance of the absolute theory of sovereign immunity. Furthermore, the granting of sovereign immunity to foreign governments in the courts of the United States is most inconsistent with the action of the Government of the United States