Act of State Doctrine
Encyclopedia
The Act of State Doctrine says that a nation is sovereign
within its own borders, and its domestic actions may not be questioned in the courts of another nation.
(neither customary international law
nor treaty
law), but it is a principle recognized and adhered to by United States federal courts
. Its aim is not to protect other nations' sovereignty by intervention from the U.S. but rather to protect the US Executive
's prerogatives in foreign affairs from being frustrated by a decision issuing from U.S. courts.
The Act of State Doctrine enters consideration most often in cases where a foreign sovereign has expropriated the property of a U.S. national located in that foreign territory (e.g. through nationalization). Rather than pursuing recourse through the courts, United States nationals are to take their claims against foreign sovereign governments to the Executive so that the government can either espouse the claims of all U.S. nationals as a group or seek recourse through diplomatic channels. The United States employs the Act of State Doctrine more broadly and with more frequency than other countries.
n government and took control of Ciudad Bolivar
, where plaintiff Underhill lived and ran a waterworks system for the city. Underhill, an American citizen, repeatedly applied to Hernandez for an exit passport, but his requests were refused, and Underhill was forced to stay in Ciudad Bolivar and run the waterworks. Hernandez finally relented and allowed Underhill to return to the United States, where he instituted an action to recover damages for his detention in Venezuela. In finding for the Defendant, a New York Court determined that Hernandez had acted in his official capacity as a military commander so his actions were those of the Venezuelan government. The Court therefore refused to hear Underhill's claim against the government based on the Act of State Doctrine. The Court reasoned, "Every sovereign state is bound to respect the independence of every other sovereign state, and the courts of one country will not sit in judgment on the acts of the government of another, done within its own territory."
applied the Act of State Doctrine in Banco Nacional de Cuba v. Sabbatino
, . The case arose when Cuba
nationalized its sugar
industry, taking control of sugar refineries and other companies in the wake of the Cuban revolution. A large number of Americans who had invested in those companies lost their investments without compensation when the Cuban government assumed control. However, despite the loss suffered by United States nationals, the Supreme Court upheld the Act of State Doctrine by assuming the validity of Cuba's domestic action and therefore rejected the claim of US nationals against Cuba for their lost investments.
The Court in Banco Nacional de Cuba v. Sabbatino
stated that although the Doctrine is not found in the Constitution
, explicitly or implicitly, it does have constitutional underpinnings in the concept of separation of powers
. The Supreme Court
reasoned that because the Executive had exclusive authority to conduct foreign affairs with other nations on behalf of the United States, disputes arising from the official actions of foreign sovereign powers should not be settled by the Judiciary because those decisions could interfere with the Executives' conduct of foreign affairs.
, an outraged Iowa
Senator. Generally, under the Hickenlooper Amendment, courts are not to apply the Act of State Doctrine as a bar against hearing cases of expropriation by a foreign sovereign. However, one provision of the Amendment instructs the courts to continue applying the Doctrine wherever the Executive tells them to. Essentially, under this Amendment, the Executive has the authority to decide on a case-by-case basis whether the Judiciary has the power to hear a case.
The judiciary has interpreted the Amendment narrowly so that it can continue to apply the Act of State Doctrine in many cases. For instance, the Second Circuit
held that the Amendment only applied if the property involved in the foreign act was inside the United States. Also, the court in Hunt v. Coastal States Gas Producing Co. found the Hickenlooper Amendment applied only where there are claims to title of property, excluding breach of contract
claims.
Sovereignty
Sovereignty is the quality of having supreme, independent authority over a geographic area, such as a territory. It can be found in a power to rule and make law that rests on a political fact for which no purely legal explanation can be provided...
within its own borders, and its domestic actions may not be questioned in the courts of another nation.
United States
The doctrine is not required by international lawInternational law
Public international law concerns the structure and conduct of sovereign states; analogous entities, such as the Holy See; and intergovernmental organizations. To a lesser degree, international law also may affect multinational corporations and individuals, an impact increasingly evolving beyond...
(neither customary international law
Customary international law
Customary international law are those aspects of international law that derive from custom. Along with general principles of law and treaties, custom is considered by the International Court of Justice, jurists, the United Nations, and its member states to be among the primary sources of...
nor treaty
Treaty
A treaty is an express agreement under international law entered into by actors in international law, namely sovereign states and international organizations. A treaty may also be known as an agreement, protocol, covenant, convention or exchange of letters, among other terms...
law), but it is a principle recognized and adhered to by United States federal courts
United States federal courts
The United States federal courts make up the judiciary branch of federal government of the United States organized under the United States Constitution and laws of the federal government.-Categories:...
. Its aim is not to protect other nations' sovereignty by intervention from the U.S. but rather to protect the US Executive
Executive (government)
Executive branch of Government is the part of government that has sole authority and responsibility for the daily administration of the state bureaucracy. The division of power into separate branches of government is central to the idea of the separation of powers.In many countries, the term...
's prerogatives in foreign affairs from being frustrated by a decision issuing from U.S. courts.
The Act of State Doctrine enters consideration most often in cases where a foreign sovereign has expropriated the property of a U.S. national located in that foreign territory (e.g. through nationalization). Rather than pursuing recourse through the courts, United States nationals are to take their claims against foreign sovereign governments to the Executive so that the government can either espouse the claims of all U.S. nationals as a group or seek recourse through diplomatic channels. The United States employs the Act of State Doctrine more broadly and with more frequency than other countries.
Background
The Act of State Doctrine, which arose out of state practice in the 17th Century, entered into American jurisprudence in the case Underhill v. Hernandez, . In an 1892 revolution, General José Manuel "Mocho" Hernández expelled the existing VenezuelaVenezuela
Venezuela , officially called the Bolivarian Republic of Venezuela , is a tropical country on the northern coast of South America. It borders Colombia to the west, Guyana to the east, and Brazil to the south...
n government and took control of Ciudad Bolivar
Ciudad Bolívar
Ciudad Bolívar is the capital of Venezuela's southeastern Bolivar State. It was founded with the name Angostura in 1764, renamed in 1846, and, as of 2010, had an estimated population of 350,691....
, where plaintiff Underhill lived and ran a waterworks system for the city. Underhill, an American citizen, repeatedly applied to Hernandez for an exit passport, but his requests were refused, and Underhill was forced to stay in Ciudad Bolivar and run the waterworks. Hernandez finally relented and allowed Underhill to return to the United States, where he instituted an action to recover damages for his detention in Venezuela. In finding for the Defendant, a New York Court determined that Hernandez had acted in his official capacity as a military commander so his actions were those of the Venezuelan government. The Court therefore refused to hear Underhill's claim against the government based on the Act of State Doctrine. The Court reasoned, "Every sovereign state is bound to respect the independence of every other sovereign state, and the courts of one country will not sit in judgment on the acts of the government of another, done within its own territory."
Banco Nacional de Cuba v. Sabbatino
In 1964, the United States Supreme CourtSupreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
applied the Act of State Doctrine in Banco Nacional de Cuba v. Sabbatino
Banco Nacional de Cuba v. Sabbatino
Banco National de Cuba v. Sabbatino, 376 U.S. 398 , was a United States Supreme Court case that determined that the policy of United States federal courts would be to honor the Act of State Doctrine, which dictates that the propriety of decisions of other countries relating to their internal...
, . The case arose when Cuba
Cuba
The Republic of Cuba is an island nation in the Caribbean. The nation of Cuba consists of the main island of Cuba, the Isla de la Juventud, and several archipelagos. Havana is the largest city in Cuba and the country's capital. Santiago de Cuba is the second largest city...
nationalized its sugar
Sugar
Sugar is a class of edible crystalline carbohydrates, mainly sucrose, lactose, and fructose, characterized by a sweet flavor.Sucrose in its refined form primarily comes from sugar cane and sugar beet...
industry, taking control of sugar refineries and other companies in the wake of the Cuban revolution. A large number of Americans who had invested in those companies lost their investments without compensation when the Cuban government assumed control. However, despite the loss suffered by United States nationals, the Supreme Court upheld the Act of State Doctrine by assuming the validity of Cuba's domestic action and therefore rejected the claim of US nationals against Cuba for their lost investments.
The Court in Banco Nacional de Cuba v. Sabbatino
Banco Nacional de Cuba v. Sabbatino
Banco National de Cuba v. Sabbatino, 376 U.S. 398 , was a United States Supreme Court case that determined that the policy of United States federal courts would be to honor the Act of State Doctrine, which dictates that the propriety of decisions of other countries relating to their internal...
stated that although the Doctrine is not found in the Constitution
Constitution
A constitution is a set of fundamental principles or established precedents according to which a state or other organization is governed. These rules together make up, i.e. constitute, what the entity is...
, explicitly or implicitly, it does have constitutional underpinnings in the concept of separation of powers
Separation of powers
The separation of powers, often imprecisely used interchangeably with the trias politica principle, is a model for the governance of a state. The model was first developed in ancient Greece and came into widespread use by the Roman Republic as part of the unmodified Constitution of the Roman Republic...
. The Supreme Court
Supreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
reasoned that because the Executive had exclusive authority to conduct foreign affairs with other nations on behalf of the United States, disputes arising from the official actions of foreign sovereign powers should not be settled by the Judiciary because those decisions could interfere with the Executives' conduct of foreign affairs.
Second Hickenlooper Amendment
In response to the outcome of the case, Congress enacted , more commonly referred to as the "Second Hickenlooper Amendment," named after the bill’s sponsor, Bourke B. HickenlooperBourke B. Hickenlooper
Bourke Blakemore Hickenlooper , was a Republican politician from the US state of Iowa. He was lieutenant governor from 1939 to 1943 and then the 29th Governor of Iowa from 1943 to 1945...
, an outraged Iowa
Iowa
Iowa is a state located in the Midwestern United States, an area often referred to as the "American Heartland". It derives its name from the Ioway people, one of the many American Indian tribes that occupied the state at the time of European exploration. Iowa was a part of the French colony of New...
Senator. Generally, under the Hickenlooper Amendment, courts are not to apply the Act of State Doctrine as a bar against hearing cases of expropriation by a foreign sovereign. However, one provision of the Amendment instructs the courts to continue applying the Doctrine wherever the Executive tells them to. Essentially, under this Amendment, the Executive has the authority to decide on a case-by-case basis whether the Judiciary has the power to hear a case.
The judiciary has interpreted the Amendment narrowly so that it can continue to apply the Act of State Doctrine in many cases. For instance, the Second Circuit
United States Court of Appeals for the Second Circuit
The United States Court of Appeals for the Second Circuit is one of the thirteen United States Courts of Appeals...
held that the Amendment only applied if the property involved in the foreign act was inside the United States. Also, the court in Hunt v. Coastal States Gas Producing Co. found the Hickenlooper Amendment applied only where there are claims to title of property, excluding breach of contract
Breach of contract
Breach of contract is a legal cause of action in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party's performance....
claims.
External links
- A Brief Primer on International Law With cases and commentary. Nathaniel Burney, 2007.
- Official UN website on International Law
- Official website of the International Court of Justice