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REPORTS OF JUDGMENTS,
ADVISORY OPINIONS AND ORDERS
CASE CONCERNING
CERTAIN PROPERTY
(LIECHTENSTEIN v. GERMANY)
PRELIMINARY OBJECTIONS
2005
COUR INTERNATIONALE DE JUSTICE
AFFAIRE RELATIVE
À CERTAINS BIENS
(LIECHTENSTEIN c. ALLEMAGNE)
EXCEPTIONS PRÉLIMINAIRES
Salcs number
ISSN 0074-4441
ISBN 92-1-071007-X
N° de vente: 896
10 FEBRUARY 2005
JUDGMENT
CERTAIN PROPERTY
(LIECHTENSTEIN v. GERMANY)
PRELiMINARY OBJECTIONS
CERTAINS BIENS
(LIECHTENSTEIN c. ALLEMAGNE)
EXCEPTIONS PRÉLIMINAIRES
10 FÉVRIER 2005
ARRÊT
6
CASE CONCERNING
CERTAIN PROPERTY
(LIECHTENSTEIN v. GERMANY)
PRELIMINARY OBJECTIONS
'" '"
Jurisdiclion of Ihe Courl based on Article f of Ihe European Conve/1/ioll for
the Peacejul Seulement of Disputes - Limitation ratione temporis contained in
Arlicle 27 Ca) o/Ihat Convention.
Six preliminary objeclions 10 the jurisdiction of the Courl and the admissi-
bi/ity of Ihe Application raised by Germany.
,.
Germany's firsl pre/iminary ohjeclion
CO/1/elllion by Gemwny Iha! thtre is no dispute bellVeen the Parlies - No
"change ofposilion" \Vith regard to Germuny's Ireatment of Liechlellslein prop-
erty confiscaled in conneclion wilh the Second World War .)"(lid 10 lIave
occurred - Germany has neva accepted the validity oI Ihe ReneS: confisca-
lions - Germall courts have consistently held that Ihey are barred hy Ihe
Seulement Convenlion }"rom adjudicaling 0/1 the Imvfulness of confiscation
4
7 CERTAIN PROPERTY (JUDGMENT)
Jurisprudence of the Court and its predecessor regarding the question of the
existence of a dispute - Complaints offact and law formulated by Liechten-
stein against Germany denied by the latter - A legal dispute exists between the
Parties - Germany's position in course of bilateral consultations has eviden-
tiary value in this regard - Subject-maller of the dispute - First preliminary
objection dismissed.
*
Germany's second preliminary objection.
Contention by Germany that the Court lacks j/lrisdiction ratione temporis on
the basis of Article 27 (a) of the European Convention for the Peaceful Settle-
ment of Disputes - Were the Court ta find that there exists a dispute it 1V0uld,
according ta Germany, relate ta the Settlement Convention and the BeneS
Decrees, which predate the critical date, i. e. the entry into force of the European
COlll'ention for the Peaceful Settlement of Disputes as betlVeen Liechtenstein
and Germany (18 February 1980) - German courts said ta have consistently
held that they lacked jurisdiction under the Settlement COlll'ention ta evaluate
the lawfu/ness of confiscations effected in cormection with the Second Wor/d
War.
Need for the Court ta determine whether the dispute relates ta facts or situa-
tions that arase before or after the critical date - Phosphates in Morocco
case - Eleetrieity Company of Sofia and Bulgaria case - Right of Passage
case - Text of Article 27 (a) of the European Convention for the Peaceful
Seulement of Displlle.l' does not differ in substance from temporal jurisdiction
limitations dealt with in tl/ose cases - Test ojjinding the source or real cause of
the dispute used in previous case law equal/y applicable in current instance -
No common understanding between Liechtenstein and Germany that the Setllement
Convention did not apply ta Liechtenstein property - German courts have con-
5
8 CERTAIN PROPERTY (JUDGMENT)
JUDGMENT
6
9 CERTAIN PROPERTY (JUDGMENT)
7
10 CERTAIN PROPERTY (JUDGMENT)
THE COURT,
composed as above,
after deIiberation,
delil'ers the following Judgment:
1. On 1 June 2001, the Principality of Liechtenstein (hereinafter referred to
as "Liechtenstein") filed in the Registry of the Court an Application instituting
proceedings against the Federal Republic of Germany (hereinafter referred to
as "German y") relating to a dispute concerning
"decisions of Germany, in and after 1998, to treat certain property of
Liechtenstein nationals as German assets having been 'seized for the pur-
poses of reparation or restitution, or as a result of the stale of war' - i.e.,
as a consequence of World War II -, without ensuring any compensation
for the loss of thal property to its owners, and to the detriment of Liech-
tenstein itseIr'.
In order to found the jurisdiction of the Court, the Application relied on
Article 1 of the European Convention for the Peaceful Settlement of Disputes
of 29 April 1957, which entered into force between Liechtenstein and Germany
on 18 February 1980.
2. Pursuant to Article 40, paragraph 2, of the Statute, the Application was
immediately communicated to the German Government by the Registrar; and,
in accordance with paragraph 3 of that Article, ail States entitled to appear
before the Court were notified of the Application.
3. By an Order of 28 June 2001, the Court fixed 28 March 2002 as the time-
limit for the filing of the Memorial of Liechtenstein and 27 December 2002 for
the filing of the Counter-Memorial of Germany, the latter time-limit being
fixed without prejudice to the possible application of Article 79, paragraph l, of
the Rulcs of Court, in their revised version applicable with eITect from 1 Feb-
ruary 2001. On 28 March 2002, within the time-Iimit thus prescribed, Liechten-
stein filed in the Registry its Memorial.
4. Since the Court included upon the Bench no judge of the nationality of
Liechtenstein, Liechtenstein exercised its right under Article 31, paragraph 2, of
the Statute to choose a judge ad hoc to sit in the case. It first chose Mr. lan
Brownlie, who resigned on 25 April 2002, and subsequently Sir Franklin Ber-
man.
5. By a Note Verbale of 29 April 2002, the Republic of Austria requested the
Court to furnish it with a copy of the Memorial of Liechtenstein. Having ascer-
tained the views of the Parties pursuant to Article 53, paragraph l, of the R ules
of Court, the Court decided that it was not appropriate to grant that request.
The Registrar communicated that decision to Austria and to the Parties by
letters dated 18 July 2002.
6. On 27 June 2002, within the time-limit prescribed in Article 79, para-
graph 1, of the Rules of Court, Germany raised preliminary objections relating
to the jurisdiction of the Court to entertain the case and to the admissibility of
the Application submitted by Liechtenstein. The President of the Court, noting
that, by virtue of Article 79, paragraph 5, of the Rules of Court, the proceed-
ings on the merits were suspended, and having ascertained the views of the
Parties at a meeting held with their Agents, by an Order dated 12 July 2002,
fixed 15 November 2002 as the time-limit within which Liechtenstein might
present a written statement of its o.bservations and submissions on the prelimi-
8
II CERTAIN PROPERTY (JUDGMENT)
8. Pursuant to Article 53, paragraph 2, of its Rules, the Court, having ascer-
tained the views of the Parties, decided that copies of the pleadings and docu-
ments annexed would be made accessible to the public on the opening of the
oral proceedings.
9. Public hearings were held on 14, 16, 17 and 18 June 2004, during which
the Court heard the oral arguments and replies of:
For Germany: Mr. Thomas Laufer,
Mr. Jochen Frowein,
Mr. Christian Tomuschat,
Mr. Pierre-Marie Dupuy.
For Liechtenstein: H.E. Mr. Alexander Goepfert,
H.E. Mr. M. Roland Marxer,
Mr. James Crawford,
Mr. Dieter B1umenwitz,
M r. Thomas Bruha,
Mr. Gerhard Hafner,
Mr. Alain Pellet.
10. In its Application, the following requests were made by Liechtenstein:
"For these reasons, each of which is pleaded in the alternative, Liech-
tenstein, reserving the right to supplement or to amend this Application
and subject to the presentation to the Court of the relevant evidence and
legal argument, requests the Court to adjudge and declare that Germany
has incurred international legal responsibility and is bound to make appro-
priate reparation to Liechtenstein for the damage and prejudice suffered.
Liechtenstein further requests that the nature and amount of sueh repara-
tion should, in the absence of agreement .between the Parties, be assessed
and determined by the Court, if necessary, in a separate phase of the pro-
ceedings."
II. In the written proceedings, the following submissions were presented by
the Parties:
011 behalf of the GOl'ernment of Liechtenstein,
in the Memorial:
"1. For the reasons set out above, and reserving the right to amend
these submissions in the light of further evidence and argument, the Prin-
cipality of Liechtenstein requests the Court to adjudge and declare that:
(a) by its conduct with respect to Liechtenstein and the Liechtenstein
property, Germany has failcd to respect the sovereignty and neutral-
9
12 CERTAIN PROPERTY (JUDGMENT)
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13 CERTAIN PROPERTY (JUDGMENT)
"For ail these reasons, and reserving the right of the Principality of
Liechtenstein to supplement them in view of any further German argu-
ments, it is respectfully submitted:
(a) that the Court has jurisdiction over the claims presented in the
Application of the Principality of Liechtenstein, and that they are
admissible; .
and correspondingly
(h) that the Preliminary Objections of Germany be rejected in their
entirety."
12. At the oral proceedings, the following submissions were presented by the
Parties:
On hehalf of the GOllernment of Germany,
at the hearing of 17 June 2004:
"Germany requests the Court to adjudge and declare that:
it lacks jurisdiction over the claims brought against Germany by the
Principality of Liechtenstein, referred to it by the Application of Liech-
tenstein of 30 May 2001,
and that
the claims brought against Germany by the Principality of Liechten-
stein are inadmissible to the extent specified in its Preliminary Objec-
tions."
011 hehalf of the GOllernmellt of Liechtenstein,
at the hearing of 18 June 2004:
"For the rcasons set out in its Written Observations and during the oral
proceedings, the Principality of Liechtenstein respectfully requests the
Court:
(a) to adjudge and declare that the Court has jurisdiction over the claims
presented in its Application and that they are admissible;
and accordingly,
(h) to reject the Preliminary Objections of Germany in their entirety."
•••
13. During the Second World War Czechoslovakia was an allied
country and a belligerent in the war against Germany. In 1945, it
adopted a series of decrees (the "Benes Decrees"), among them Decree
No. 12 of21 June 1945, under which "agricultural property" of "ail per-
sons belonging to the German and Hungarian people, regardless of their
nationality" was confiscated. Under the terms of this Decree, "agricul-
tural property" included, inter alia, buildings, installations and movable
property pertaining thereto. The properties confiscated under Decree
No. 12 comprised sorne owned by Liechtenstein nationals, including
Prince Franz Josef II of Liechtenstein. These measures were contested by
11
14 CERTAIN PROPERTY (JUDGMENT)
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15 CERTAIN PROPERTY (JUDGMENT)
ber 1990, an Exchange of Notes was executed between the three Western
Powers and the Government of the Federal Republic of Germany (the
parties to the Settlement Convention) under which that Convention
would terminate simultaneously with the entry into force of the Treaty.
Whereas that Exchange of Notes terminated the Settlement Convention
itself, including Article 5 of Chapter Six (relating to compensation by
Germany), it provided that paragraphs 1 and 3 of Article 3, Chapter Six,
"shalI, however, remain in force".
***
18. Tt is recalIed that in the present proceedings, Liechtenstein based
the Court's jurisdiction on Article 1 of the European Convention for the
Peaceful Settlement of Disputes which provides that:
"The High Contracting Parties shalI submit to the judgement of
the International Court of Justice ail international legal disputes
13
16 CERTAIN PROPERTY (JUDGMENT)
In its written observations and final submissions during the oral pro-
ceedings, Liechtenstein requested the Court to reject Germany's prelimi-
nary objections in their entirety.
* *
14
18 CERTAIN PROPERTY (JUDGMENT)
*
24. According to the consistent jurisprudence of the Court and the
Permanent Court of International Justice, a dispute is a disagreement on
a point of law or fact, a conflict of legal views or interests between parties
(see Mavrommati.\· Palestine Concessions. Judgment No. 2,1924, P. CI.J.,
Series A, No. 2, p. Il; Northern Cameroons, Preliminary Objections,
Judgment, l.e.J. Reports 1963, p. 27; Applicability of the Obligation to
A rbilrate under Section 21 of the United Nations Headquarters Agree-
ment of 26 June /947, Advisory Opinion, 1. CJ. Reports 1988, p. 27,
para. 35; East Timor (Portugal v. A ustralia) , Judgment, /. CJ. Reports
/995, pp. 99-100, para. 22). Moreover, for the purposes of verifying the
existence of a legal dispute it falls to the Court to determine whether "the
daim of one party is positively opposed by the other" (South West
Africa, Preliminary Objections, Judgment, 1.CJ. Reports 1962, p. 328).
25. The Court recalls that Liechtenstein has characterized its dispute
with Gernlany as involving the violation of its sovereignty and neutrality
by the Respondent, which, for the first time in 1995, treated Liechtenstein
property confiscated under the Benes Decrees as German external assets
for the purposes of the Settlement Convention, notwithstanding Liech-
tenstein's status as a neutral State. Germany for its part denies altogether
the existence of a dispute with Liechtenstein. It asserts instead that "the
subject-matter of this case" is the confiscation by Czechoslovakia in 1945
16
19 CERTAIN PROPERTY (JUDGMENT)
26. It remains for the Court to identify the subject-matter of the dis-
pute before it. Upon examination of the case file, the Court finds that the
subject-matter of the dispute is whether, by applying Article 3, Chap-
ter Six, of the Settlement Convention to Liechtenstein property that had
been confiscated in Czechoslovakia un der the Benes Decrees in 1945,
Germany was in breach of the international obligations it owed to Liech-
tenstein and, if so, what is Germany's international responsibility.
27. Having established the existence of a dispute betwccn Liechten-
stein and Germany and identified its subject-mattcr, the Court concludes
that the first preliminary objection of Germany must be dismissed.
* *
28. The Court will now examine Germany's second preliminary objec-
tion that Liechtenstein's Application should be rejected on the grounds
that the Court lacks jurisdiction ratione temporis to decide the present
dispute.
*
29. Germany asserts that were the Court to find that there exists a
dispute, it would nevertheless fall outside the jurisdiction of the Court
by virtue of Article 27 (a) of the European Convention for the Peaceful
Settlement of Disputes (see paragraph 18 above). In its view, such a
dispute would relate to facts or situations prior to 18 February 1980,
the date when the European Convention for the Peaceful Settlement of
Disputes entered into force between Germany and Liechtenstein. ln
Germany's vicw, the Application should therefore be rejected.
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20 CERTAIN PROPERTY (JUDGMENT)
30. Germany contends that the key issue for the purpose of applying
Article 27 (a) is not the date when this dispute arase, but whether the
dispute relates to facts or situations that arase before or after the critical
date. Only if these facls or situations took place after the critical date,
tha! is after 1980, would the Court have jurisdiction ratione tempo ris
under Article 27 (a). But sinee, in Germany's view, this dispute relates
to faets and situations that predate 1980, the Court lacks the requisite
jurisdiction.
18
21 CERTAIN PROPERTY (JUDGMENT)
36. Germany also suggests that the distinction between the source of
the rights c1aimed by one of the parties and the source of the dispute,
referred to by the Permanent Court of International Justice in the Elec-
tricity Company of Sofia and Bulgaria case and by the International
Court of Justice in the Right of Passage case, is of no relevance to the
present case. This is so, Germany submits, because none of the legal and
factual situations "which are the real cause of the alleged dispute" can be
attributed to or involve acts or decisions ta ken after 1980; rather, they
19
22 CERTAIN PROPERTY (JUDGMENT)
relate entirely to the legal situation created in the aftermath of the Second
World War and, in particular, to "the confiscation of Liechtenstein prop-
erty by Czechoslovakia in 1945 and thereafter and possible legal conse-
q uences of these confiscations".
*
39. Germany's second preliminary objection requires the Court to
decide whether, applying the provisions of Article 27 (a) of the Euro-
pean Convention for the Peaceful Settlement of Disputes, the present dis-
pute relates to facts or situations that arose before or after the 1980
critical date.
40. As recalled by the Parties (see paragraphs 34 and 36 to 38 above),
this Court and the Permanent Court of International Justice have dealt
with a comparable issue in a number of cases. Thus, in the Phosphates in
Morocco case, the French declaration accepting the Permanent Court of
20
23 CERTAIN PROPERTY (JUDGMENT)
41. In the Electricity Company afSofia and Bulgaria case, the wording
of the Belgian limitation ralione temporis was identical ta the relevant
language of the French dec1aration in the Phosphates in Morocco case.
Here, tao, the parties agreed that the dispute arase after the critical date,
but they disagreed as to whether the "facts or situations" with regard to
which the dispute arose were prior or subsequent to that date. In the
Electricity Company case, Bulgar1a argued that the awards of the Belgo-
Bulgarian Mixed Arbitral Tribunal, which predated the critical date, had
ta be treated as the "situations" that gave rise ta the dispute. The Per-
manent Court of International Justice rejected this argument and held
that, while these awards constituted the source of the rights claimed by
Belgium, they were not the source of the dispute because the parties had
been in agreement throughout regarding their binding character. The
Court explained this conclusion as follows:
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24 CERTAIN PROPERTY (JUDGMENT)
the same date". Here the Court first found that the dispute arose in 1954,
when India interfered with Portugal's alleged right of passage over Tndian
territory to certain Portuguese enclaves. The Court turned next to the
question of the date of the situations or faets with regard to whieh the
dispute arose. Relying on the holding of the Permanent Court of Inter-
national Justice in the Electricity Company of Sofia and Bu/garia case,
the Court emphasized that in detcrmining the facts or situations with
regard to which a dispute has arisen, only thase facts or situations are
relevant that can be considered as being the source of the dispute, that is,
its real cause. It then made the following finding:
"Up ta 1954 the situation of those territories may have given rise
ta a few minor incidents, but passage had been effected without any
eontroversy as to the title under whîch it was effected. It was only in
1954 that such a controvers y arase and the dispute rel a tes both to
the existence of a right of passage to go into the enclaved territories
and ta India's failure ta comply with obligations which, aeeording to
Portugal, werc binding upon it in this connection. lt was from all of
this that the dispute referred ta the Court arose; it is with regard to
ail of this that the dispute exists. This whole, whatever may have
been the earlier origin of one of its parts, came into existence only
after 5 February 1930." (Right of Passage over [ndian Terri/ory,
Merils, Judgment, r. Cl. Reports 1960, p. 35.)
43. The text of Article 27 (a) of the European Convention for the
Peaceful Settlement of Disputes (see paragraph 18 a bove) does not differ
in substance From the temporaljurisdiction limitations dealt with in those
cases. ln particular, no consequence can be drawn from the use of the
expressions "with regard to" or "re1ating to" which have been employed
indifferently in the various lexts in question. The Court notes further that
in the Phosphates in Morocco case, the Electricity Company in Sofia and
Bulgaria case and the Right of Passage case, the Permanent Court of
International Justice and this Court were ca lied upon to interpret uni-
lateral declarations accepting the Court's jurisdiction under its Statu te,
whereas, in the present case, the Court has to interpret a multilateral
Convention. Without pronouncing in any more general sense upon the
extent to whîch such instruments are to be treated comparably, the Court
finds no reason on this ground ta interpret differently the phrase in issue.
Nor have the Parties suggested otherwise.
22
25 CERTAIN PROPERTY (JUDGMEl'n)
"[t]he facts or situations to which regard must be had ... are those
with regard to which the dispute has arisen or, in other words, as
was said by the Permanent Court in the case concerning the Elec-
tricity Company of Sofia and Bulgaria, only 'those which must be
considered as being the source of the dispute', those which are its
'real cause'" (RighI of Passage over Indian Territory. Merits, Judg-
ment, 1. C. 1. Reports 1960, p. 35).
45. Thus in the Phosphates În Morocco case, the tacts with regard to
which the dispute arose were found ta be legislative measures that pre-
dated the critical date. The objection ratione temporis was accordingly
upheld. ln the Electricily Company of Sofia and Bulgaria and the Righ!
of Passage cases, the disputes were found to have had their source in
facts or situations subsequent to the critical date and thus the objections
ratione temporis were rejected.
46. The Court considers that, in so far as it has to determine the facts
or si tua tions to which this dispu te relates, the foregoing test of finding the
source or real cause of the dispute is equally applicable to this case.
47. The Court wîll now consider whether the present dispute has its
source or real cause in the facts or situations which occurred in the 1990s
in Germany and, particularly, in the decisiollS by the German courts in
the Pieter van Laer Painting case, or whether its source or real cause is
the Benes Decrees under which the painting was confiscated and the
Settlement Convention which the German courts invoked as ground
for declaring themselves without jurisdiction to hear that case.
48. The Court observes that it is not contested that the present dispute
was triggered by the decisions of the German courts in the afore-
mentioned case. This conclusion does not, however, dispose of the
question the Court is called u pon to decîde, for under Article 27 (a) of
the European Convention for the Peaceful SeWement of Disputes, the
critical issue is not the date when the dispute arose, but the date of the
facts or situations in relation to which the dispute arose.
49. In the Court's view, the present dispute could only relate to the
events that transpired in the 1990s if, as argued by Liechtenstein, in this
period, Germany either departed from a previous common position that
the Settlement Convention did not apply to Liechtenstein property, or if
German courts, by applying their earlier case law under the Settlement
Convention for the first time to Liechtenstein property, applicd that Con-
vention "to a new situation" after the critical date.
50. With regard to the first alternative, the Court has no basis for
. concluding that prior to the decîsions of the German courts in the
Pieter l'an Laer Painting case, there existed a common understanding or
agreement between Liechtenstein and Germany that the Settlement Con-
23
26 CERTAIN PI{QPERTY (JUDGMENT)
vention did not apply to the Liechtenstein pro pert y seized abroad as
"German external assets" for the purpose of reparation or as a result of
the war. The issue whether or not the Settlement Convention applied to
Liechtenstein property had not previously arisen before German courts,
nor had it been dealt with prior thereto in intergovernmental talks
between Germany and Liechtenstein. Moreover, German courts have
consistently held that the Settlement Convention deprived them of juris-
diction to address the legality of any confiscation of property treated as
Germa n pro pert y by the con fi scating State (see J udgment of the German
Federal Court of Justice (Bundesgerichtshof) of II April 1960, II ZR 64/
58; see also Judgment of the German Federal Court of Justice (Bundes-
gerichtshof) of 13 December 1956 (AKU case), Il ZR 86/54). In the
PÎeler van Laer Painting case, the German courts confined themselves ta
stating that the Seulement Convention was applicable in cases of confis-
cation under Decree No. 12, as with the other BeneS Decrees, and that,
consequently, it was also applicable to the confiscation of the painting.
Liechtenstein's contention regarding the existence of a prior agreement or
cornmon understanding and an alleged "change of position" by Germany
cannot therefore be upheld.
52. The Court concludes that, although these proceedings were insti-
tuted by Liechtenstein as a result of decisions by German courts regard-
ing a painting by Pieter van Laer, these events have their source in
specifie measures taken by Czechoslovakia in 1945, which led to the
confiscation of property owned by sorne Liechtenstein nationals, includ-
ing Prince Franz Jozef II of Liechtenstein, as well as in the special régime
created by the Settlement Convention. The decisions of the German
courts in the 1990s dismissing the claim filed by Prince Hans-Adam II of
Liechtenstein for the return of the painting ta him were taken on the
basis of Article 3, Chapter Six, of the Settlement Convention. Whîle these
decisions triggered the dispute between Liechtenstein and Germany, the
24
27 CERTAIN PROPERTY (JUDGMENT)
** *
53. Having dismissed the first preliminary objection of Germany, but
upheld its second, the Courtfinds that it is not required to consider
Germany's other objections and that it cannat rule on Liechtenstein's
daims on the mcrits.
* >1< >1<
25
28 CERTAIN PROPERTY (JUDGMENT)
(Signed) SHIJiuyong,
President.
(Signed) Philippe COUVREUR,
Registrar.
(Initial/ed) J.Y.S.
(Initialled) Ph.C.
26