Analysis

It may not be far–fetched to conclude here on the basis of the above-mentioned subjects that international agreements need not be kept if their performance is no longer in the interest of the state. However such a conclusion may be superfluous because of the following. Jean Bodin set up his theory of sovereignty in order to build up the complete autonomy of the French state as against the three powers which, in the Middle Ages, threatened its independence; the church, the Roman empire and the feudal lords.⁵⁷⁹

On the principle of pacta sunt servanda, Bodin stated expressly that the sovereign is subject to legal rules and the princes “are all bound by God’s law and also by the law of nature.”⁵⁸⁰ The prince must keep his word, for “feudality and loyalty are the very basis of all justice, not only in the state but also in the whole human community.”⁵⁸¹ Contracts concluded with foreign countries must be faithfully performed and the danger of destruction cannot release the state from its contractual obligations.⁵⁸² In his contribution, Jellinek postulated that the theory of Bodin and the political theories of the 16^th, 17^th and 18^th centuries were illogical. Jellinek restricted, “in conformity with the Spirit of the times, “the sanctity of contracts for states, according to Bodin’s concept of sovereignty to such contracts “which established a lasting situation (e.g., treaties of peace or of cession) or which provided for a short period of performance by the State with the means at its disposal.”⁵⁸³ He thought that a lasting restriction of the legislative and administrative powers

577Jolls, Christine, Contracts as Bilateral Commitments: A New Perspective on Contract Modification, Journal of Legal Studies 26 (January), 1997, pp. 203-237.http://legal-dictionary.thefreedictionary.com/contracts.

578 Heller, Hermann, Die Souveränität: Ein Beitrag zur Theorie des Staats- und Völkerrechts, Berlin and Leipzig, 1927, p.14 ff; Meinecke, Friedrich, Die Idee der Staatsräson, Munich-Berlin, 1924, p.70 ff.; Verdross, Alfred, Die Einheit des rechtlichen Weltbildes auf Grundlage der Völkerrechtsverfassung, Tübingen, 1923, p.14 ff; Seidl-Hohenveldern, Ignaz, Völkerrecht, 9. Aufl., 1997, p. 89, RdN. 401-410.

579 Cf. Jellinek, Georg, Allgemeine Staatslehre, 3rd ed., Berlin, 1914, p.440 ff.

580 Bodin, Jean, 1961, p.149ff.

581 Wehberg, Hans, Pacta Sunt Servanda, 53 AJIL 1959, p. 777 ; Compare ibid. n. 578 Meinecke, Friedrich, pp. 70 ff. ; Jellinek, Georg, Allgemeine Staatslehre, p. 440 ff. (3^rd ed., Berlin), 1914.

582

ibid. Wehberg, Hans, p. 777.

583 ibid. n.581, Jellinek, 1914, p.740.

of the state, as is frequently found in modern contracts, would amount to “an unacceptable surrender of sovereignty.”⁵⁸⁴ However if Bodin’s thought is adapted to its contemporaneous world setting, where there were neither unions, nor supra-national organizations, then it would appear that Bodin’s theory included all the national contracts, which could be made at the time, and that his principle of sanctity of contracts was not limited to a special kind of convention. It is a fact that Bodin made exemption to the rule, for example, “in cases where what you have promised is by nature unfair or cannot be performed.”⁵⁸⁵ Such exemptions gave the support of power politics a privilege for extensive interpretation.⁵⁸⁶ In his reaction, Grotius argued that the king himself cannot reverse a position that was previously established in a civil law, and nullify a contract or release himself from his oath.⁵⁸⁷ These reservations portrayed that Bodin’s doctrine has scarcely been disadvantageous to international law and in particular to the sanctity of contracts. Francisco de Vitoria (1483-1546),⁵⁸⁸ and Francisco de Suarez (1548-1617),⁵⁸⁹ amongst others had also supported the principle of sanctity of contracts. However in the 17^th century, an antithesis of the principle of sanctity of contracts arose from two great philosophers, Hobbes and Spinoza, also called the exponents of the doctrine of raison d’Etat. Thomas Hobbes (1588-1679), the English philosopher of utilitarianism, propounded in his “Leviathan”, that the holder of state power had an almost unlimited power and must not be bound by the principle of justice but those of wisdom.⁵⁹⁰ Nevertheless, Hobbes recognised as natural law the principle that agreements are to be honoured. The idea of wrong emanates out of the non-performance of a contract, the promisor being therefore, in contradiction with himself. And finally, he sacrificed the sanctity of contracts at the altar of state security.⁵⁹¹ In his “Tractatus Theologicopoliticus” (1670), Spinoza (1632-1677) said that no holder of state power can adhere to the sanctity of contracts to the detriment of his own country without committing a crime.⁵⁹² Therefore, for Hobbes, the sanctity of contracts is only sacrosanct, if the security of the state is not in question. This is undoubtedly a rejection of the principle of pacta sunt servanda and Spinoza can in fact be described as a forerunner of Hegel.⁵⁹³ Other notable writers in this field are Samuel Pufendorf (1632-1694) and Cornelius van Bynkershoek (1673-1743).

584 Jellinek, Georg, Allgemeine Staatslehre, 1914, p.740.

585 Wehberg, Hans, Pacta Sunt Servanda, 53 AJIL, 1959, p. 777.

586 Meinecke, Friedrich, Die Idee der Staatsräson, 1924, p.80.

587 Grotius, Hugo, De Jure belli ac pacis, Liber II, chap. 14, No. 1, 1625

588 de Vitoria, De potestate civili, p.21; Reibstein, Ernst, Völkerrecht, Vol. I, p. 287.

589 Suàrez, De legibus ac Deo legislatore, II, cap. XVIII, No. 19, 1612.

590 Hobbes, Thomas, Leviathan, Anaconda Verlag, Köln, 2009, 18. Teil, pp.177-187 & 19. Teil, p.188 ff;

591 Compare ibid. n.586, p.273.

592 ibid. n.590, chap. 13; ibid. n.586, p. 272; Spinoza, B., Theologisch-politischer Traktat, 1670, p. 273f.

593 ibid. n.586, pp. 427-428.

In his book, “De jure naturae et gentium” (1672), the former described as one of the inviolable rules of natural law that each man must keep his word without breaking it.⁵⁹⁴ The latter expressed the opinion that without the principle of good faith and that of the binding force of contracts, international law would be entirely destroyed.⁵⁹⁵ Emer de Vattel (1714-1767) in his famous “Driot des Gens” (1757), accorded this question a special section of his book, under the title “Obligation to keep Contracts.” ⁵⁹⁶ He advanced that nations and their leaders must hold fast to their oaths and their contracts, since no security and no commerce would otherwise be possible between nations. He pointed out on several occasions what he called “foi des 143cepti”. He meant something more as was shown by Ernst Reibstein,⁵⁹⁷ than the mere sanctity of contracts between the contracting parties. He shared the same opinion with Abbe de Mably (1709-1785), who, in his “Droit public de l’Europe” (1748), referred to the trust that all powers should and must create through the establishment of an objective legal order, even though limited to single states.⁵⁹⁸ By the application of the clausula rebus sic stantibus, Vattel cautioned: it would be a shameful misuse of the clause – in his opinion – if a contracting party took advantage of any change in the circumstances to release himself from his obligations.⁵⁹⁹

Nothing would then be left upon which one could rely ⁶⁰⁰ and Johann Jacob Moser (1701-1785), the founder of the positivist school of international law, explained, in his

“Grundsätze des jetzt üblichen Europäischen Völkerrechts in Friedenszeiten” (1763), that contracts could only be canceled “with the consent of all interested parties.”⁶⁰¹ Georg Friedrich von Martens (1756-1821) explained in his “Einleitung in das positive Völkerrecht, auf Verträge und Herkommen gegründet” (1796): ⁶⁰² a valid and binding contract creates, for nations and individuals alike, the complete right to demand from the other party the performance of the contract, so long as the contracting party, on his side, has performed satisfactorily his obligations. Johann Ludwig Klüber (1762-1837) in his Europäisches Völkerrecht (1821) ⁶⁰³ devoted to the sanctity of contracts a special chapter in which he emphasised that the performance without breach of international contracts was a principle of all nations and was required by the very purpose of the state.

594 Pufendorf, Samuel, De jure naturae et gentium, 1672, Book II, Chap. III, § 23; Id., Book III, chaps. III, IV, §§ 1, 2.

595 van Bynkershoek, Cornelius, Quaestionum juria publici libri duo, 1737, II, Chap. 10.

596 de Vattel, Emer, Driot des Gens, 1757, Book II, Chap. XII, § 163.

597 Reibstein, Ernst, Die Dialektik der souveränen Gleichheit bei Vattel, Zeitschrift für ausländisches öffentliches Recht u. Völkerrecht, 1958, p. 629.

598 de Mably, Abbe, Droit public de l’Europe, 1748.

599

Compare Seidl-Hohenveldern, Ignaz, Völkerrecht, 9. Aufl., 1997, Rd.N. 424.

600 ibid. n.596, Book II, chap. XVII, § 296; Reibstein, Ernst, Völkerrecht, 1958, p.594.

601 Moser, Johann Jacob, Grundsätze des jetzt üblichen Europäischen Völckerrechts in Friedenszeiten, 1763, p 574.

602 von Martens, Georg Friedrich, Einleitung in das positive Volkerrecht, auf Vertrage und Herkommen gegründet, 1796, p. 59.

603 Klüber, Johann Ludwig, Europäisches Völkerrecht, 1821, pp. 234, 235.

There were also notable voices against the philosophy of pacta sunt servanda and foremost in this vanguard of dissenters was the German philosopher, Georg Friedrich Wilhelm Hegel (1770-1831) who had an immense influence on the thinking of the 19^th century on international law. For him the law was a product of the will. The will of the nation was the carrier of the law. Contracts could therefore be valid only so long as they contributed to the welfare of the state. The sanctity of the state was for Hegel preeminent.⁶⁰⁴

The influence of his theory on the German, Italian, English and French doctrine of international law has been clearly portrayed by Verdross.⁶⁰⁵ One can see this influence with the German’s scholar, August Wilhelm Heffter (1796-1880) on the sanctity of contracts in his book, “Das Europäische Völkerrecht der Gegenwart” (1844), pointed out that Pacta sunt servanda was a foremost principle of international law but however limited the scope of the principle as follows: “one can scarcely disagree with the view that a contract in itself creates a right only through the union of wills (duorum vel plurium in idem consensus) and thus only for so long as this union exists.”⁶⁰⁶ This Observation prompted the editor of the last two editions of the work, F. Heinrich Geffcken, to add: “but nevertheless for so long as the will of the contracting parties has bound them, unless there exists a special reason to justify a withdrawal from the contract.”⁶⁰⁷

These divergent views prompted international jurists to find a synthesis to the application of the sanctity of contracts because of their perception that international law was being undermined and the principle of sanctity of contracts was based on the will of the state. They therefore, suggested a basis which would leave unaltered the principle of the sanctity of contracts in spite of a continued adherence to the will of the state as a foundation of international law. Consequently, George Jellinek (1851-1911) rested the validity of international contracts on the self-imposed obligation of states: “The state can release itself of any self-imposed restraint, but only in legal forms and in creating new limitations. The restraint, but not the particular limitation is permanent.”⁶⁰⁸ It is clear in so far that the state, if its will is decisive in the final analysis, can release himself from a self-imposed obligation and if there is no higher will, which compels the state to keep its word, then there is no sufficient basis given to the contract, which obligates the state to observe

604 Verdross, Alfred, Die Einheit des rechtlichen Weltbildes, Tübingen, 1923, p.4 ff; Meinecke, Friedrich, Die Idee der Staatsräson, Tübingen, 1923, p.434 ff.

605 ibid. Verdross, p. 6 ff.

606 Heffter, August Wilhelm, Das Europäische Völkerrecht der Gegenwart 144, Berlin, 1844, pp. 234-235.

607 ibid. (8. ed.), revised by Geffcken, F. Heinrich, Berlin, 1888, pp.183–184.

608 Jellinek, Georg (1851-1911), Allgemeine Staatslehre (3rd ed.), 1914, p. 482.

it. This theory did not go down well with modern theorists of jurisprudence. In his attempt to reconcile the doctrine of the will of the state with the rule of pacta sunt servanda, Heinrich Triepel (1868-1946) in his classical work, “Völkerrecht und Landesrecht” (1899), rejected Jellinek’s theory of self-imposed obligation, and therefore sought to show that the source of contracts was a common will of the contracting parties, “which arises through interaction with the will of other states.”⁶⁰⁹ This principle also turned out to be a failure, because the binding character of a contract is based not on a higher law but on the will of the states.

even if it is based on the will of majority of states, the hypothesis of a “common will” is a mere fiction.

It should be added that Triepel limited the application of his theory to agreements in the sense of law-making treaties (“145cepti-lois”). Above all, however, only a law which stands above the will of the state can create the binding power of contracts. This theory was abandoned later and another principle of pacta sunt servanda was sought. Dionisio Anzilotti (1867-1950) described the principle of pacta sunt servanda as a hypothetical basic norm, which can be assumed but not proven.⁶¹⁰ For him, the rule pacta sunt servanda is the basic norm for all international law. This principle cannot, however, explain the validity of customary law and above all the validity of contracts cannot rest upon a mere postulate.

This new theory of international law, whether it is regarded as positivist or not, adheres to the validity of the term pacta sunt servanda. This is hardly surprising, since any other view will amount to denying the existence of international law in general. If one considers that the law of nations was built less upon customary law than upon contracts, if contracts validly concluded were not binding, then international law would be deprived of a decisive foundation and a society of states will no longer be possible. International law, and with it also the sanctity of contracts, results by a natural necessity from the inevitability of social intercourse; the binding force of contracts is an obligation, which exists, not only vis-à-vis the contracting parties, but also vis-à-vis the international community as a whole.⁶¹¹