PACTA SUNT SERVANDA Treaty, in what way the multiple objectives of the Treaty can best be served,
Gabcikovo-Nagymaros Project (Hungary v. Slovakia) keeping in mind that all of them should be fulfilled, for their mutual benefit.
In 1977, Hungary and Czechoslovakia entered into a treaty ("1977 Treaty)
concerning the construction and operation of the Gabcikovo-Nagymaros System of
Locks (essentially to construct a barrage system (like a dam) ("GN project"). This
project was designed so both countries could utilize the Bratislavia-Budapest
section of the Danube river essentially for hydroelectricity. Unfortunately, due to
criticisms regarding the joint project, Hungary was constrained to suspended and
then eventually abandon its part. Czechoslovakia tried to propose provisional
solutions, but the two countries could not come to an agreement. Finally, the
Hungarian Government sent a Note Verbale terminating the 1977 treaty to take
effect within 6 days. Constrained, Czechoslovakia decided to implement and
subsequently operate its "Variant C" solution to prevent it from sustaining further
losses. The Commission on European Communities mediated and the parties
principally agreed to submit the dispute to the International Court of Justice.
DOCTRINE
Bear in mind that during the time the case was being undertaken by the ICJ,
Czechoslovakia has already constructed and operated its "Variant C" solution,
which included the construction at Cunovo, effectively acting as a replacement for
what should have been constructed by Hungary in Dunakiliti. The filling of the
Cunovo dam led to a reduction in the flow of water to the old Danube bed and of
the side-arms of the river (obviously affecting Hungary). This means that the 1977
Treaty cannot anymore be followed to the letter since a different factual situation
now exists. On the basis of the Court's findings, the ICJ, in determining the future
conduct of the parties held:
"It is not for the Court to determine what shall be the final result of these
negotiations to be conducted by the parties. It is for them to find an agreed solution
that takes account of the objectives of the Treaty which must be pursued in a joint
and integrated way, keeping in mind the norms of international law. What is
required in the present case by the rule pacta sunt servanda, as reflected in
Art. 26 of the Vienna Convention of 1969, is that the parties find an agreed
solution within the co-operative context of the Treaty. Article 26 combines two
elements, which are of equal importance, providing that "every treaty in force is
binding upon the parties to it and must be performed by them in good faith." This
latter element, implies that in this case, it is the purpose of the Treaty and the
intentions of the parties concluding it which should prevail over its literal
application.
What is essential is that the developing treaty relationship be preserved, and be
conducted to achieve its object and purpose in so far as that is feasible. The
parties are under a legal obligation to consider within the context of the 1977
FACTS
1. The Danube has always been important for the commercial and economic
development of its riparian States.
2. The potential of the Danube for hydroelectric power has been exploited by
some states and it is against this backdrop that the 1977 Treaty between
Hungary and then Czechoslovakia was signed.
3. The project would be jointly owned in equal measure by both parties and
ownership would be vested on the State on whose territory the works were
constructed.
4. Hungary would have control over the works at Nagymaros while
Czechoslovakia would have control over the Gabcikovo area. In addition,
Hungary was to construct a dam at Dunakiliti. The Treaty also provided that
the technical specifications for the system be included in the "Joint Contractual
Plan" (JCP) to be drawn up.
5. The treaty also provided that the cost of the joint investment will be borne by
the parties in equal measure. Moreover, it stipulated work to be carried out by
each one of them.
6. The treaty also stated that the JCP would specify a water balance to be
measured (i.e. sharing of water in the Danube by both states).
7. In the event that the water level becomes imbalanced, share of electric power
of the parties benefitting from the excess withdrawal of water shall be reduced.
8. The treaty also stated that the parties should ensure that the quality of the
water in the Danube is not impaired as a result of the construction of the GN
project.
9. The work started on Hungary's initiative, but the two parties subsequently
agreed through two Protocols signed to slow the work down and postpone the
operation of the power plants.
10. Then, by another Protocol, both parties agreed to accelerate the project.
11. There were profound political and economic changes during this time in
Europe and the project became an increasing apprehension for both Hungary
and Czechoslovakia. The uncertainties were both about the economic viability
of the project and the ecological impact of the same.
12. Thus, due to intense criticism the project generated, particularly in Hungary,
the Hungarian Government decided to suspend the works at Nagymaros
pending completion of various studies. They also subsequently suspended the
works at Dunakiliti. Eventually they decided to abandon works at Nagymaros
while maintaining status quo at Dunakiliti
13. Negotiations were being held during this period between the parties, while
Czechoslovakia also started investigating alternative solutions (7 in total), one
of which was "Variant C" ("VC").
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14. VC entailed a unilateral diversion of the Danube by Czechoslovakia and a
construction of a dam at Cunovo (Czechoslovakian territory) to essentially
function as a replacement for the Dunakiliti portion which Hungary suspended.
Of course, Czechoslovakia protested to this.
15. In addition to this, the political situation in both states changed and new
Governments were confronted with new problems.
16. In 1991, the Slovak Government (Czechoslovakia is now a federal government
with Czech and Slovakia as states) decided to begin construction of VC.
17. Discussions continued between the states but to no avail.
18. In 1992, Hungary transmitted a Note Verbale terminating the 1977 Treaty with
effect after a mere six days from receipt of Czechoslovakia of the note.
19. Through the mediation of the Commission of the European Communities
(which was the old EU) the parties principally agreed that the dispute be
submitted to the ICJ.
20. In 1993 Slovakia became an independent state. Slovakia and Hungary entered
into a Special agreement concerning the GN project and agreed to establish a
temporary water regime which they agreed on after a number of negotiations,
while the case was still with the ICJ.
ISSUE with HOLDING
1. Whether Hungary validly terminated the 1977 Treaty through its Note Verbale.
– NO. It was premature. The 1977 Treaty is still in force.
a. Hungary claimed that it was due to Czechoslovakia's construction and
operation of Variant C that its alleged "state of necessity" was made
permanent which justified the termination of the 1977 treaty.
i. The Court agreed with Czechoslovakia in that even of such a
state of necessity existed, it would not give rise to a right to
terminate the 1977 Treaty. The state of necessity may only be
invoked to exonerate Hungary from its responsibilities which it
failed to implement, but it does not in any way give it any right
to terminate the Treaty.
ii. The Treaty may be ineffective as long as the condition of
alleged "state necessity" continues to exist, but, unless the
parties by mutual agreement terminate the Treaty, it continues
to exist, albeit dormant.
iii. The same can be said of the "impossibility of performance" by
Hungary of its obligations due to Czechoslovakia's acts.
These situations may be a ground for suspending a treaty but
not a ground for termination.
iv. The ICJ also held that the 1977 treaty was broad enough to
allow enough legroom for the parties to amend and adjust the
regime to reflect economic and ecological imperatives.
v. In the Court's view, the prevalent political, economic and
ecological conditions were not so closely linked to the object
and purpose of the Treaty that they constituted an essential
basis of the mutual consent of the parties to conclude the
Treaty.
vi. Moreover, the ICJ is of the view that it is only a material
breach of the treaty by a State party to that treaty, which
entitles the other party to rely on it as a ground for terminating
the treaty. Moreover, Hungary only provided SIX DAYS for the
termination of the Treaty, which is not in accordance with
international custom.
b. Hungary claimed that it was entitled to terminate the Treaty because
new requirements of international law for the protection of the
environment precluded performance of the treaty.
i. The ICJ held that the Treaty provided evolving provisions
recognizing the potential necessity to tweak the project to
adapt. The environmental norms can be incorporated in the
JCP.
ii. The responsibility to do this is a joint responsibility. Their
implementation requires a mutual willingness to discuss in
good faith actual and potential environmental risks.
2. Whether Hungary was entitled to suspend and subsequently abandon the
works on the project. – NO. There was no "state of necessity" (see Art. 33
of International Responsibility of States) that would entitle Hungary to
validly suspend and abandon the works. There is no "grave and
imminent peril" as regards the ecological effects of the project as
Hungary would have wanted the ICJ to believe.
a. Hungary contended that though it suspended and abandoned works, it
never suspended the application of the 1977 Treaty itself, justifying its
conduct on a "state of ecological necessity."
i. Court cannot accept this argument. Hungary's conduct during
that time showed its unwillingness to comply with some of the
provisions of the Treaty and the subsequent Protocol. This
rendered impossible the accomplishment of the GN project.
ii. The Court also held that the fact that Hungary invoked the
doctrine of "state of necessity" shoed that it chose to place
itself within the ambit of the law of State responsibility – i.e.
that without this "necessity" Hungary's actions would have
been unlawful.
iii. In addition, such "state of necessity" would not exempt it from
its duty to compensate the other party – it only provides
Hungary a justifying circumstance in acting the way it did.
b. Hungary also accused Czechoslovakia of violating various provisions
of the treaty.
i. The ICJ held that it does not need to examine this argument.
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 c. Hungary also contended that the Law of Treaties should not be i. The ICJ held that it was not a justifiable countermeasure as it
applied to the current case since it came into force after the 1977 did not meet the condition of proportionality.
treaty was concluded.
i. Court held that some of the rules laid down in the Law of 4. Whether Slovakia properly succeeded Czechoslovakia. – YES. The Articles
Treaties might be considered as a codification of existing on Succession of States identified "treaties of a territorial character" as
customary law. having been regarded both in traditional doctrine and in modern opinion
ii. This applies to the provisions regarding termination and as unaffected by a succession of states. The subject treaty falls under
suspension of the operation of treaties (Articles 60 to 62) this category.
iii. The parties in this case were also broadly in agreement as a. The particular nature and character of the 1977 Treaty confirms that
regards the foregoing. aside from its undoubted nature of a joint investment, its major
elements were the proposed construction and operation of structures
3. Whether the Czech and Slovak Federal Republic was entitled to proceed with and installations on specific parts of the territories of Hungary and
its "provisional solution" i.e. Variant C, and to put it into operation. – YES to Czechoslovakia along the Danube.
undertaking the works of Variant C, but NO to its operation.
Czechoslovakia decided to put the VC into operation unilaterally,
exclusively under its own control and for its own benefit, to the detriment
of Hungary. This effectively violated express provisions of the 1977
Treaty, depriving Hungary of its basic right to an equitable and
reasonable sharing of the resources of the Danube. Nevertheless,
Czechoslovakia was entitled to construct Variant C, in so far as it
confined itself to undertaking works which did not predetermine the final
decision to be taken by it. The same could not be considered as a
countermeasure as it is not in accordance to the international law
concept of proportionality (i.e. what Czechoslovakia did was not
proportional to what Hungary did).
a. Czechoslovakia maintained that their action of proceeding with Variant
C and its implementation were not internationally wrongful acts
because Hungary's decision made it impossible for them to carry out
works as contemplated by the 1977 Treaty. Slovakia also invoked the
"principle of approximate application"
i. The ICJ distinguished between the "actual commission of a
wrongful act" and the conduct prior to that act which is of a
preparatory character (the latter does not qualify as a wrongful
act).
ii. In relation to this, the ICJ held that proceeding to Variant C
was a preparatory act which was reasonable, considering the
losses that Czechoslovakia incurred due to Hungary's
unilateral abandonment of its Treaty obligations.
iii. However, the operation of Variant C was an internationally
unlawful act as it deprived Hungary of its rights to a just
sharing of the resources as prescribed by the 1977 Treaty.
b. Slovakia also argued in the alternative that Czechoslovakia's conduct
was lawful in that it was a countermeasure against Hungary's
infractions.
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