Tinoco Claims Arbitration (Great Britain v. Costa Rica)
(1923) 1 R.I.A.A. 369
Procedural History:
Arbitration of contract repudiation.
Overview:
Great Britain (P) claimed that the former government of Costa Rica (D), the Tinoco regime, had granted oil concessions to a British company that had to be honored by the present regime. The Tinoco regime had seized power in Costa Rica by coup. Great Britain (P) and the United States never recognized the Tinoco regime. When the Tinoco regime fell, the restored government nullified all Tinoco contracts, including an oil concession to a British company. Great Britain (P) claimed that the Tinoco government was the only government in existence at the time the contract was signed and its acts could not be repudiated. Costa Rica (D) claimed that Great Britain (P) was estopped from enforcing the contract by its nonrecognition of the Tinoco regime. The matter was sent for arbitration.
Issue:
Does nonrecognition of a new government by other governments destroy the de facto status of the government?
Rule:
-A government that establishes itself and maintains a peaceful de facto administration need not to conform to previous constitution and nonrecognition of the govt. by other govt.’s does not destroy the de facto status of the govt.
Analysis:
The arbitrator found there was no estoppel. The evidence of nonrecognition did not outweigh the evidence of the de facto status of the Tinoco regime. Unrecognized governments thus may have the power to form valid contracts.
Outcome:
No. A government that establishes itself and maintains a peaceful de facto administration need not conform to a previous constitution and nonrecognition of the govern ment by other governments does not destroy the de facto status of the government. Great Britain's (P) nonrecognition of the Tinoco regime did not dispute the de facto existence of that regime. There was no estoppel since the successor government had not been led by British nonrecognition to change its position.
(1923) 1 R.I.A.A. 369
Procedural History:
Arbitration of contract repudiation.
Overview:
Great Britain (P) claimed that the former government of Costa Rica (D), the Tinoco regime, had granted oil concessions to a British company that had to be honored by the present regime. The Tinoco regime had seized power in Costa Rica by coup. Great Britain (P) and the United States never recognized the Tinoco regime. When the Tinoco regime fell, the restored government nullified all Tinoco contracts, including an oil concession to a British company. Great Britain (P) claimed that the Tinoco government was the only government in existence at the time the contract was signed and its acts could not be repudiated. Costa Rica (D) claimed that Great Britain (P) was estopped from enforcing the contract by its nonrecognition of the Tinoco regime. The matter was sent for arbitration.
Issue:
Does nonrecognition of a new government by other governments destroy the de facto status of the government?
Rule:
-A government that establishes itself and maintains a peaceful de facto administration need not to conform to previous constitution and nonrecognition of the govt. by other govt.’s does not destroy the de facto status of the govt.
Analysis:
The arbitrator found there was no estoppel. The evidence of nonrecognition did not outweigh the evidence of the de facto status of the Tinoco regime. Unrecognized governments thus may have the power to form valid contracts.
Outcome:
No. A government that establishes itself and maintains a peaceful de facto administration need not conform to a previous constitution and nonrecognition of the govern ment by other governments does not destroy the de facto status of the government. Great Britain's (P) nonrecognition of the Tinoco regime did not dispute the de facto existence of that regime. There was no estoppel since the successor government had not been led by British nonrecognition to change its position.
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