Contents
Foreword 19
Introduction 21
Chapter One: The Iran-United States Claims Tribunal 47
1.1 General 47
1.2 The Algiers Accords (1981) 49
1.3 Genesis of the Iran-U. S. Claims Tribunal 50
1.4 The Tribunal’s Structure 52
1.5 The Tribunal’s Jurisdiction 53
1.6 The Applicable Law 53
1.6.1 Disputes Arising out of Expropriation 56
1.6.1.1 International law 56
1.6.1.2 Treaty of Amity 56
1.6.2 Disputes Arising Out of Contractual Relation 58
1.6.2.1 General Principles of Law 58
1.6.2.1.1 Sources of the Tribunal’s General Principles of Law 60
1.6.2.1.1.1 Comparative Municipal Law 60
1.6.2.1.1.2 Lex Mercatoria 62
1.6.2.1.1.3 Public International Law 64
1.6.3 Procedural Law of the Iran-U.S. Claims Tribunal 64
1.7 The Nature of the Tribunal 65
1.8 The Precedential Value of Tribunal Practice 67
1.9 Summary 73
Chapter Two: The Principle of Compensation in Transnational Arbitration 75
2.1 General 75
2.2 Cause of Action 77
2.2.1 Expropriation 78
2.2.2 Breach of International Law 79
2.2.3 Breach of Contract 80
2.3 Principle of Full Compensation 80
2.3.1 The Standard of Compensation in the Iran-U.S. Claims Tribunal 86
2.3.2 Different Compensation Standards in Lawful and Unlawful Expropriation 91
2.3.3 Creeping Expropriation; Lawful or Unlawful? 97
2.4 Unjust Enrichment as a Basis for Compensation 99
2.4.1 Prohibition of Double Recovery 104
2.5 Equitable Considerations 107
2.6 Summary 109
Chapter Three: Limitations on Damage 113
3.1 General 113
3.2 Causation 114
3.2.1 Direct and Indirect Expropriation 118
3.2.1.1 Interference with Contract Rights 121
3.2.1.2 Taking Control Over the Property 124
3.2.1.3 Interference with Administrative Rights 126
3.2.1.4 Reforming Legislation Affecting the Property Rights 126
3.3 Foreseeability 127
3.4 Certainty 132
3.5 Duty to Mitigation 138
3.5.1 Reasonable Measures 140
3.5.2 Substitute Transaction 142
3.5.3 Anticipatory Breach 143
3.6 Summary 145
Chapter Four: Category of Losses 149
4.1 General 149
4.2 Damnum Emergens (suffered loss) 150
4.2.1 Damage in Devaluation of the Currency 151
4.2.1.1 Currency of Damage 151
4.2.1.2 Date of Conversion 154
4.2.1.3 Rate of Conversion 156
4.2.2 Damage for Foreign Currency Exchange 158
4.2.3 Damage for Inflation 159
4.2.4 Adjudication Expenses 160
4.2.4.1 Legal Fees in the Practice of the Iran-U.S. Claims Tribunal 161
4.2.4.1.1 Reasonableness of the Costs of Arbitration 164
4.2.4.2 Cost Apportion 165
4.2.4.2.1 Parties’ Degree of Success 166
4.2.4.2.2 The Parties’ Conduct 167
4.3 Lucrum Cessans (Lost profit) 169
4.3.1 Loss of Profit in Case of Contract Breach 170
4.3.1.1 Lost-Volume Damage to Seller 176
4.3.2 Loss of Profit in Expropriation 178
4.4 Summary 179
Chapter Five: Valuation 181
5.1 General 181
5.2 Method of Valuation; Fair Market Value 182
5.2.1 Valuation of Business Enterprise 185
5.2.1.1 Income-Based Methods 185
5.2.1.1.1 Going-Concern Value 186
5.2.1.1.1.1 The Effects of Market Circumstances 189
5.2.1.1.1.2 Eliminating the New-Business Rule 191
5.2.1.1.2 Discounted Cash Flow (DCF) 193
5.2.1.1.2.1 Discount Factor 196
5.2.1.1.2.2 Important Issues of Applying DCF Method 199
5.2.1.2 Asset-Based Method 203
5.2.1.2.1 Net Book Value (NBV) 204
5.3 Valuation Date 206
5.4 Summary 209
Chapter Six: Interest 213
6.1 General 213
6.2 Right to Interest under Transnational Instruments 216
6.3 Interest in the Practice of the Iran-U.S. Claims Tribunal 218
6.3.1 Interest in the case of excused non-payment 222
6.4 Moratory (Delay) v. Compensatory Interest 223
6.5 Accrual Period in Tribunal Jurisprudence 225
6.6 Form of Interest: Simple or Compound 227
6.7 Interest Rate 231
6.7.1 An Attempt to Make the Interest Rate Uniform 233
6.7.2 The McCollough Method 234
6.7.3 The Sylvania Method 235
6.7.4 The Interest Rate in Inter-State Claims 236
6.7.5 Agreed Rate of Interest 238
6.8 Summary 239
Conclusion 241
Bibliography 251