Section VI.—Mixed arbitral tribunal (Art. 304 and 305)
(a) Within three months from the date of the coming into force of the present Treaty, a Mixed Arbitral Tribunal shall be established between each of the Allied and Associated Powers on the one hand and Germany on the other hand. Each such Tribunal shall consist of three members. Each of the Governments concerned shall appoint one of these members. The President shall be chosen by agreement between the two Governments concerned.
In case of failure to reach agreement, the President of the Tribunal and two other persons either of whom may in case of need take his place, shall be chosen by the Council of the League of Nations, or, until this is set up, by M. Gustave Ador if he is willing. These persons shall be nationals of Powers that have remained neutral during the war.
If any Government does not proceed within a period of one month in case there is a vacancy to appoint a member of the Tribunal, such member shall be chosen by the other Government from the two persons mentioned above other than the President.
The decision of the majority of the members of the Tribunal shall be the decision of the Tribunal.
(b) The Mixed Arbitral Tribunals established pursuant to paragraph (a), shall decide all questions within their competence under Sections III, IV, V and VII.[Page 625]
In addition, all questions, whatsoever their nature, relating to contracts concluded before the coming into force of the present Treaty between nationals of the Allied and Associated Powers and German nationals shall be decided by the Mixed Arbitral Tribunal, always excepting questions which, under the laws of the Allied, Associated or Neutral Powers, are within the jurisdiction of the National Courts of those Powers. Such questions shall be decided by the National Courts in question, to the exclusion of the Mixed Arbitral Tribunal. The party who is a national of an Allied or Associated Power may nevertheless bring the case before the Mixed Arbitral Tribunal if this is not prohibited by the laws of his country.
(c) If the number of cases justifies it, additional members shall be appointed and each Mixed Arbitral Tribunal shall sit in divisions. Each of these divisions will be constituted as above.
(d) Each Mixed Arbitral Tribunal will settle its own procedure except in so far as it is provided in the following Annex, and is empowered to award the sums to be paid by the loser in respect of the costs and expenses of the proceedings.
(e) Each Government will pay the remuneration of the member of the Mixed Arbitral Tribunal appointed by it and of any agent whom it may appoint to represent it before the Tribunal. The remuneration of the President will be determined by special agreement between the Governments concerned; and this remuneration and the joint expenses of each Tribunal will be paid by the two Governments in equal moieties.
(f) The High Contracting Parties agree that their courts and authorities shall render to the Mixed Arbitral Tribunals direct all the assistance in their power, particularly as regards transmitting notices and collecting evidence.
(g) The High Contracting Parties agree to regard the decisions of the Mixed Arbitral Tribunal as final and conclusive, and to render them binding upon their nationals.
Text of May 7:
The High Contracting Parties agree to regard the decisions of the Mixed Arbitral Tribunal as final and conclusive, and to render them binding upon their nationals.
Note to X, 304
According to the German delegation, mixed arbitral tribunals should be established on the principle that “unity of administration of justice may be assured for all litigants in matters of private law, and that the execution of the verdicts may be carried out uniformly in all contracting states” (Foreign Relations, The Paris Peace Conference, 1919, vi, 894). In the Conditions of Peace, however, national courts of the Allies often took precedence over the arbitral tribunals. These provisions should be eliminated, and the tribunal should be given a comprehensive and exclusive competence to deal with all questions of the same kind; to give questions within the framework of the treaty to national courts would involve the risk of exposing their verdicts to attacks of the nationalistic press. All verdicts should be valid and executed in the territories of all the contracting states. The appointment of the president of the tribunal by the League of Nations would be acceptable if Germany were admitted to the League. Germany also protested against the provision that the language of the court and the place and time of its sessions would be determined by the former enemy state interested. These points should be determined by the president. There should be full reciprocity between the states in matters of exchange of notices and collecting evidence.
The Allies replied that the purpose of the tribunal was not only to decide new rights but also to provide a forum to which disputes concerning existing rights could be referred (ibid., p. 987). As to the latter, the courts of the Allies already possessed jurisdiction and could not be deprived of it; these courts received no new jurisdiction. The Allies agreed that the language of the mixed tribunal might be English, French, Italian, or Japanese, and that the time and place of meeting should be determined by the president. They further agreed to accept the German suggestion that the parties should furnish to the tribunals all assistance in their power as regards transmitting notice and collecting evidence. To a German request for information as to the property of German nationals in Allied countries, the Allies replied that it was not possible to furnish a reliable estimate.
For special application to Poland, see article 92.
Mixed arbitral tribunals were set up with Germany by Belgium, Czechoslovakia, France, Great Britain, Greece, Italy, Japan, Poland, Rumania, Serb-Croat-Slovene State, and Siam. The tribunals set up with Austria, Bulgaria, Hungary, and Turkey, which were less numerous for each of those states, worked alongside the German tribunals at Paris or London. The same personnel, where possible, served throughout the system. There were 24 presidents for half again as many tribunals. Agents-general for the governments appeared before several tribunals.
The tribunals began their work in 1920 and, with few exceptions, [Page 627]completed it in 1930. The members of the tribunals collaborated in issuing the Recueil des décisions des Tribunaux arbitraux mixtes institués par les traités de paix, published under the auspices of the Office français des biens et intérêts privés by Recueil Sirey, 1922–30, in 10 volumes. This collection contains the texts, usually in French, of the decisions of all the tribunals, the rules of procedure of the various tribunals, relevant national court decisions, and agreements between the parties.
Though part X, section VI, was so drafted as to relate to the “Allied and Associated Powers”, the United States did not establish a mixed arbitral tribunal under these provisions, as it was privileged to do in virtue of the treaty of August 25, 1921 restoring friendly relations with Germany. Instead, the agreement of August 10, 1922 (Treaty Series 665; Treaties, Conventions, etc., 1910–23, iii, 2601) provided for the establishment of the Mixed Claims Commission, United States and Germany, which was empowered to consider cases that arose both while the United States was neutral and while it was a belligerent.
An arrangement was effected by exchange of notes between the United States and Great Britain on January 4, and February 23, 1927 regarding the release of property seized under the American and British trading-with-the-enemy acts. With respect to corporations, it was stated that the British position was “governed by decisions of the Courts and of the Mixed Arbitral Tribunals” (Treaty Series 754–A).
The Mixed Claims Commission, United States and Germany, established in pursuance of the agreement of August 10, 1922, consisted of a citizen of the United States as umpire (at the request of the German Government) and American and German commissioners. Administrative Decision No. 1 dated November 1, 1923 gave the meaning of certain terms which served to differentiate United States-German settlements from those effected under the treaty of peace. These meanings were:
“Germany or her allies: the German Empire or the Austro-Hungarian Empire, Bulgaria, and/or Turkey;
“War period: the period between August 1, 1914, and July 2, 1921, both inclusive, the latter date being that on which the joint resolution passed by the Congress of the United States declaring the war at an end became effective;
“Period of neutrality: the period between August 1, 1914, and April 5, 1917, both inclusive:[Page 628]
“Period of belligerency: the period between April 6, 1917, and July 2, 1921, both inclusive, the former date being that on which the joint resolution declaring a state of war to exist between Germany and the United States became effective”.
This commission had functions, so far as they were adopted by the United States, which in the treaty of peace were assigned to
- The Reparation Commission (art. 231–244 and annexes);
- The Clearing Offices (art. 296 and annex);
- The Mixed Arbitral Tribunal (art. 304 and annex);
- The Arbitrator (part X, sec. IV, annex, par. 4).
From the commission’s jurisdiction there were excepted claims included under the treaty of peace of three categories (Mixed Claims Commission, United States and Germany, Administrative Decision No. 1):
“There are expressly excepted from this decision (1) claims of the United States as such against Germany, (2) claims based on debts owing to American nationals by Germany or by German nationals, and (3) claims arising out of the application of either exceptional war measures or measures of transfer as defined in paragraph 3 of the Annex to Section IV of Part X of the Treaty of Versailles.”
The financial obligations of Germany to the United States arising from
the treaty of August 25, 1921 restoring friendly relations put forward
by the United States on behalf of its nationals pursuant to the
agreement of August 10, 1922 embraced (Mixed Claims Commission, United
States and Germany, Administrative Decision No. 1):
Altogether 20,434 claims were submitted to the commission and 7025 items of award were made, 4 of which were on behalf of the United States and the rest on behalf of private claimants. The Settlement of War Claims Act, approved March 10, 1928 (45 Stat. 254), provided for the domestic payment of the awards, which bore interest according to their terms up to January 1, 1928 and thereafter at 5 percent per annum. Up to March 31, 1941 the Treasury had paid out principal and interest on private awards amounting to $158,599,739.22 and the balance due them was $96,673,460.34. The 4 awards to the Government of the United States were of a principal amount of about $42,000,000, or $59,800,000 with interest up to March 31, 1941; payment was deferred until the private claims [Page 630]are liquidated. The corresponding recovery from Germany up to July 1, 1941 amounted to $53,396,763.57. This sum was derived from the annuities of the Experts’ (Dawes) Plan in virtue of article 3, A, of the Finance Ministers’ Agreement with Germany of January 14, 1925 and the debt agreement with Germany of June 23, 1930, under which no payments were made after September 30, 1931.
An agreement (Treaty Series 730; 44 Stat. 2213) between the United States and Austria and Hungary was signed at Washington, November 26, 1924 for the determination of the amounts to be paid by Austria and by Hungary in satisfaction of their obligations under the treaties concluded on August 24 and 29, 1921, respectively, with Austria and Hungary by the United States establishing friendly relations (Treaty Series 659 and 660; 42 Stat. 1946 and 1951). The agreement, which entered into force on December 12, 1925, established the Tripartite Claims Commission (United States, Austria, and Hungary) which performed functions similar to the Mixed Claims Commission, United States and Germany. Claims aggregating 1631 were filed.
The Settlement of War Claims Act of 1928, approved March 10, 1928 (45 Stat. 254), provides the national procedure for paying the claims involving Germany, Austria, and Hungary.