Appendix — Asociacion de Reclamantes v. United Mexican States
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IN THE
Supreme Court of the United Siates
OCTOBER TERM, 1984
ASOCIACION DE RECLAMANTES, AMINTA ZARATE, LUIS
RIOJAS, FELIPA FLORES BENAVIDEZ, MARIA AGUIRRE DE
SCHULTZ, NIEVES GUERRERO CHAPA, SANTOS ZARATE
PRIETO, Petitioners,
THE UNITED MEXICAN STATES,
Respondent.
APPENDICES TO
PETITION FOR WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
ROBERT J. SALAZAR
RUSSELL E. VIGIL
650 Lawrence Street Center
1380 Lawrence Street
Denver, CO 80204
MITCHELL ROGOVIN *
GEORGE T. FRAMPTON, JR.
Vicki C. JACKSON
ROGOVIN, HUGE & LENZNER
A Professional Corporation
1730 Rhode Island Ave., N.W.
Washington, D.C. 20036
Of Counsel (202) 466-6464
JOAQUIN G. AVILA JESS J. ARAUJO
Morris J. BALLER DIMARCO & ARAUJO
MEXICAN-AMERICAN LEGAL A Professional Law
DEFENSE & EDUCATION FUND Corporation
28 Geary Street 1015 North Broadway
San Francisco, CA 94108 Santa Ana, CA 92701
* Counsel of Record
WILGON - Eres PRINTING Co.. INC. - 789-0096 - WASHINGTON. D.C. 20001 , bl
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INDEX TO APPENDICES
Page
. Opinion of the Court of Appeals, dated June 5,
RT il USE 8. Pare ee Ce Oe ne Pe la
. Opinion and Order of the District Court ~................. 17a
. Judgment and Rehearing Orders of the Court of
RII sen catcciccaekateitl tae dahcdalldddaninimnentdeatpidaiseetanicwlavens 39a
SII + scencehiseihchighanaiustdibaasebdisastbabssiiediantanaiaitie@eieeisdandidineionton 39a
Order Denying Rehearing En Banc ........................... 4la
Order Denying Rehearing By Panel -......................... 42a
. Petitioners’ Amended Complaint ......................-.....--. A8a
. Statutory, Constitutional and Treaty Provisions...... 77a
Foreign Sovereign Immunities Act, 28 U.S.C.
88 1880, 1602, 1604, 1605 (a) ....................-.-cccccseeeenoee 77a-79a
a aicainpndinnanasadios 80a
I eee onienalammeiiebeonandintis 88a
Fifth and Fourteenth Amendments .......................... 94a
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APPENDIX A
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
No. 83-1596
ASOCIACION DE RECLAMANTES, et al.,
Appellants
Vv.
THE UNITED MEXICAN STATES
Appeal from the United States District Court
for the District of Columbia
(Civil Action No. 81-02299)
Argued March 23, 1984
Decided June 5, 1984
Vicki C. Jackson with whom Robert J. Salazar, Russell
E. Vigil, Mitchell Rogovin, George T. Frampton, Jr., and
Jess J. Araujo were on the brief, for appellants.
John H. Shenefield with whom Eric L. Richard and
D. Stephen Mathias were on the brief, for appellee.
Before: EDWARDS and SCALIA, Circuit Judges, and
SWYGERT,* Senior Circuit Judge for the United States
Court of Appeals for the Seventh Circuit.
Opinion for the Court filed by Circwit Judge SCALIA.
* Sitting by designation pursuant to 28 U.S.C. § 294(d).
2a
Concurring statement filed by Circuit Judge EDWARDS.
SCALIA, Circuit Judge: This case comes before us on
appeal from an order of the District Court dismissing
appellants’ complaint for lack of subject matter juris-
diction pursuant to Fed. R. Civ. P. 12(b) (1). It presents
the issue of interpreting the “immovable property” excep-
tion and the “tortious act” exception to sovereign im-
munity contained in the Foreign Sovereign Immunities
Act of 1976, 28 U.S.C. §§ 1605(a) (4) & (5) (1982).
I
Appellants, six individuals and the Asociacion de Re-
clamantes, claim’ to be or to represent the successors in
interest to recipients of 433 land grants from the King
of Spain or the Republic of Mexico, covering some 12
million acres now located in the State of Texas, valued
in 1925 at close to $200 million. The original grantees,
Spanish and Mexican citizens, were allegedly driven from
their land and divested of title by the United States and
Texas in the period following the Mexican-American War.
Those landowners, whose rights to title and use of their
Texas land were explicitly protected by the Treaty of
Guadalupe Hidalgo, Feb. 2, 1948, United States-Mexico,
9 Stat. 922, T.S. No. 207, Art. VIII, may have possessed,
at that time, actionable claims against the United States
for the restoration of title and possession.
The complaint does not allege that those claims were
ever pursued in United States courts. Rather, in the
early 1920’s, a new Mexican government, headed by Gen-
eral Obregon, espoused the claims and asserted them
against the United States in negotiations between the two
sovereigns. On September 8, 1923, Mexico and the United
1 Although for purposes of a Rule 12(b)(1) motion we need
not accept as true the plaintiffs’ version of controverted juris-
dictional facts, Williamson v. Tucker, 645 F.2d 404, 412-13 (5th
Cir. 1981), appellee has not contested the historical account prof-
fered by appellants and set forth here.
3a
States concluded the Treaty on General Claims, United
States-Mexico, 43 Stat. 1730, T.S. No. 678, which em-
power a General Claims Commission to evaluate the
claims of each country’s nationals raised in the negotia-
tions. Mexico filed with the Commission all 433 land
claims at issue here, but by 1936, when the authority to
hear claims expired,” none had been evaluated.
In 1938, new disputes between Mexico and the United
States arose when Mexico expropriated without compen-
sation oil-producing property owned by American citi-
zens. Negotiations between the two sovereigns were re-
sumed, and the 433 land claims were again on the bar-
gaining table. Those negotiations culminated in the
Treaty on Final Settlement of Certain Claims, United
States-Mexico, 56 Stat. 1347, T.S. No. 980 (Nov. 19,
1941) (the “1941 Treaty”). By the terms of that treaty,
Mexico released the United States from liability on all
claims—including the 433 Texas land claims—asserted
by Mexico against the United States. In addition, Mex-
ico paid the United States a lump-sum $40 million and
was absolved of liability on all claims maintained against
it. Each sovereign assumed the obligation to satisfy the
espoused claims of its own nationals, which the United
States did within seven years. Shortly after the Treaty
was signed, Mexico acknowledged its obligation by presi-
dential decree, Decree of President Manuel Avila Ca-
macho, Dec. 9, 1941, published in El Diario Oficial, Dec.
31, 1941, and assurances have been made by the Mexican
government to individual appellants as recently as 1970
that compensation would be forthcoming.
2 The General Claims Commission heard cases until 1931. Pur-
suant to the General Claims Protocol of April 24, 1934, United
States-Mexico, 49 Stat. 3531, E.A.S. No. 57, claims not decided by
the Claims Commission were transferred to two appraisers, whose
authority to evaluate the claims was to last until June 30, 1936.
4a
Nevertheless, over forty years after the 1941 Treaty,
Mexico has failed to pay a single claim. Nor has it
legislated any mechanism for adjudicating or funding the
claims. In this action appellants seek damages from the
Mexican sovereign for its uncompensated taking of the
Texas land claims. They also ask the court to place all
monies paid in satisfaction of Mexico’s liability into a
fund, and to supervise its distribution. Appellants allege
jurisdiction under the Foreign Sovereign Immunities Act
of 1976 (“FSIA’”’), 28 U.S.C. §§ 1830, 1602-1611 (1982),
which creates exceptions to soverign immunity for ac-
tions involving rights to immovable property located
within the United States and for actions for torts com-
mitted within the jurisdiction of the United States.
The District Court found jurisdiction lacking and dis-
missed the complaint. The District Court also held, al-
ternatively, that the Act of State doctrine would prohibit
adjudication of the merits of the complaint even if juris-
diction existed. We agree that the FSIA grants im-
munity to Mexico in this matter and affirm the District
Court for that reason. We have no need—and, because
we lack jurisdiction, no power—to reach the Act of State
issue.
II
The FSIA provides the sole basis for subject matter
jurisdiction over suits against foreign states. 28 U.S.C.
$§ 1330, 1604. The Act was intended to codify the so-
called “restrictive” principle of sovereign immunity, un-
der which foreign sovereigns are accorded immunity with
regard to their sovereign or public acts (actiones jure
imperii), but not with respect to their commercial acts
(actiones jure gestionis), and in addition to withhold
immunity for certain narrowly defined public acts for
which local adjudication was deemed imperative (e.g.,
traffic accidents caused by employees and officials of a
foreign embassy). H.R. Rep. No. 1487, 94th Cong., 2d
Sess. 7, 20-21, reprinted in 1976 U.S. CoDE Conc. & AD.
5a
NEws 6605, 6619-20 (hereinafter “House Report”).* The
Act sets forth as the general rule that “a foreign state
shall be immune from the jurisdiction of the courts of the
United States,” 28 U.S.C. § 1604; and then creates excep-
tions to that immunity for specific categories of cases.
Appellants do not allege that Mexico’s conduct in this
case was commercial or private in nature. Thus, the
largest and most important exception to immunity, for a
foreign sovereign’s commercial activities having some
nexus with the United States, 28 U.S.C. § 1605(a) (2), is
not at issue. Instead, appellants stake their case on two
relatively minor exceptions to immunity that apply to
public as well as private acts. We consider each of these
in turn.
A. The “Immovable Property” Exception—§ 1605 (a) (4).
Appellants contend that their causes of action against
Mexico fall within the exception to foreign sovereign im-
munity for “any case in which .. . rights in immovable
property situated in the United States are in issue.” 28
U.S.C. § 1605(a) (4). Appellants do not now seek to have
any land restored to them; rather, they argue that their
rights to be compensated by Mexico for its taking of their
prior rights (against the United States) to title and
possession of the 433 tracts in Texas constitute “rights in
immovable property” for purposes of this exception. The
issue is one of statutory interpretation: whether Con-
gress, in enacting the FSIA, intended the phrase “rights
8 Amid the confusion of the last few days of the 94th Congress
two identical foreign sovereign immunity bills were passed and
presented to the President for signature. The President signed
the House bill, H.R. 11315, and vetoed the Senate bill, S. 3553, for
technical reasons. (The President expressed doubt that the Senate
bill had been properly enrolled because the Senate, after it had
passed the House bill, had attempted unsuccessfully to rescind
the prior passage of its own bill. 122 Conc. Rec. 35082 (1976).)
For this reason, we do not cite the Senate Report which is, in any
event, identical to its House counterpart.
6a
in immovable property” to be broad enough to encompass
rights to compensation traceable historically to disputes
over title to American land, which disputes have been
settled by international agreement.
The District Court apparently agreed with appellants’
broad reading of the exception, believing jurisdiction to
exist if the suit “involves an action to quiet title or to
recover money derivative of real property rights.”
Asociacian [sic] de Reclamantes v. The United, Mexican
States, 561 F. Supp. 1190, 1196 (D.D.C. 1983) (emphasis
added).* Appellants support tnat expansive reading, ar-
guing that the statutory language “rights in immovable
property,” is broad enough to accommodate their “in-
terest” in the Texas land. They point out that the same
term is elsewhere afforded a scope which they assert is
expansive enough to include their compensation claims:
e.g., at civil law (where it includes leases, licenses, rents,
mineral rights, easements, royalties and profits, LA. CIv.
CopE ANN. art. 535 (West 1980)) and in the law of
eminent domain (where the compensation awarded for
the compulsory conversion of real estate “will be treated
as real estate until the owner, being sui juris, accepts it
as personal property,” 1 G. THOMPSON, COMMENTARIES
ON THE MODERN LAW OF REAL PROPERTY, §19 at 83
(1980 Replacement) (footnote omitted) ). Appellants also
claim to find support for a broad interpretation in the
4The District Court held that even this broad reading of the
immovable property exception did not cover this suit, and that
the claims involved mere “intangible property rights created
through the diplomatic process,” because appellants had not alleged
that they (or, presumably, their predecessors in interest) had
title to the land in 1923, when the United States-Mexico claims
negotiations took place, or that they had attempted to regain
title in a legal forum prior to that time. 561 F. Supp. at 1196-97.
We reject that analysis because such allegations did appear in an
Exhibit to the Complaint, see Amended Complaint, Exhibit B,
which is sufficient. Fed. R. Civ. P. 10(c); Mountain Fuel Supply
Co. v. Johnson, 586 F.2d 1875, 1882 (10th Cir. 1978), cert. denied,
441 U.S. 952 (1979).
Ta
legislative history of the FSIA: “[A] foreign state can-
not deny to the local state the right to adjudicate ques-
tions of ownership, rent, servitudes, and similar matters
. . -’ House Report, supra, at 20, 1976 U.S. CoDE
Cone. & Ap. NEWS 6619.
Admittedly, the term “rights in immovable property”
is an imprecise one, susceptible of as many Gifferent
meanings as there are areas of law for which that char-
acterization of an interest may be relevant. See 1 G.
THOMPSON, supra, at $19. Our job, however, is not to
give the term the most expansive reading possible, nor to
extract from different sources of law an artificial con-
sensus definition of the term, but to determine what Con-
gress meant by the language in this particular statute.
Our reading of the legislative history and understanding
of the purposes of the FSIA counsel a far narrower con-
struction of the term than that advanced by appellants.
The immovable property exception was enacted to
codify, with minor modifications not relevant here, the
pre-existing real property exception to sovereign im-
munity recognized by international practice. See House
Revort, supra, at 20, 1976 U.S. CopE Cone. & AD. NEWS
6620, referring to Letter from Jack B. Tate, Acting
Legal Adviser, U.S. Dept. of State, 26 Dept. of State
Bulletin 984 (1952), reprinted in Jurisdiction of U.S.
Courts in Suits Against Foreign States: Hearings on
H.R. 11315, Before the Subcomm. on Administrative Law
and Governmental Relations of the House Comm. on the
Judiciary, 94th Cong., 2d Sess. 54-55 (1976). That prac-
tice declined to extend the immunity of a foreign sover-
eign to “an action to obtain possession of or establish a
property interest in immovable property located in the
territory of the state exercising jurisdiction.” RESTATE-
MENT (SECOND) OF FOREIGN RELATIONS LAW OF THE
UNITED STATES § 68(b) (1965). Accord, RESTATEMENT
(SECOND) OF FOREIGN RELATIONS LAW OF THE UNITED
STATES (REVISED) § 455(1)(c) & comment b (Tent.
Draft No. 2, 1981). Thus, a foreign sovereign was not
8a
immune in an eminent domain proceeding involving its
property, but was immune in a negligence suit for in-
jury suffered by a private individual while on its prop-
erty. RESTATEMENT (SECOND) OF FOREIGN RELATIONS
LAW OF THE UNITED STATES, supra, at § 68 comment d.
The origin of the traditional exception limited to ques-
tions involving property interests or possession is self-
evident. A territorial sovereign has a primeval interest
in resolving all disputes over use or right to use of real
property within its own domain. As romantically ex-
pressed in an early treatise:
A sovereignty cannot safely permit the title to its
land to be determined by a foreign power. Each
state has its fundamental policy as to the ‘tenure of
land; a policy wrought up in its history, familiar to
its population, incorporated with its institutions,
suitable to its soil.
1 F. WHARTON, CONFLICT OF LAWS § 278 at 636 (3d ed.
1905). A subsidiary concern, less instinctive and mysti-
cal, is that courts are simply not well equipped to decide
property interests or rights to possession with regard to
land outside their jurisdiction, particularly land located
in a foreign nation. See Reasor-Hill Corp. v. Harrison,
220 Ark. 521, 523, 249 S.W.2d 994, 995 (1952). These
considerations produced not only the exception to sover-
eign immunity we are here discussing, but also the “local
action rule,” which makes the locality’s power exclusive
and deprives other courts of jurisdiction to settle ques-
tions involving real estate. Griner v. Trevino, 207 S8.W.
947, 949-50 (Tex. Civ. App. 1918); 1 G. THOMPSON,
supra, $4 at 24 (citing cases). The latter, like the for-
mer, is limited to questions that directly implicate inter-
ests in the property or rights to possession. Compare, ¢.g.,
Pace v. Ott, 189 Okla. 230, 231, 115 P.2d 253, 255 (1941)
(action for damages to land sustained by oil and salt
water pollution is not a local action), and Wise v. Isen-
hour, 9 N.C. App. 237, 239, 175 S.E.2d 772, 773 (1970)
9a
(action for damages against builders for breach of con-
struction contract is not a local action), with, e.g., Living-
ston v. Jefferson, 15 F. Cas. 660 (C.C.D. Va. 1811) (No.
8,411) (action for trespass is a local action), and Wilson
v. Kryger, 29 N.D. 28, 34, 149 N.W. 721, 723-24 (1914)
(action to determine adverse claims to real property is a
local action). See also 21 C.J.S. Courts §§ 45-49 (1940).
The two doctrines are obviously complementary, since the
local action rule without the real property exception to
sovereign immunity would mean that real property dis-
putes involving foreign sovereigns could not be resolved
in any court.
That § 1605(a) (4), like the traditional real property
exception it was intended to codify, is limited to disputes
directly implicating property interests or rights to pos-
session is consistent with the examples of its application
mentioned in the House Report and cited by appellants:
suits involving “questions of ownership, rent, servitudes,”
House Report, supra, at 20, 1976 U.S. Cope Conc. & Ap.
News 6619." It is also consistent with the single case
SIt is true that an action for rent does not always call into
question either ownership or possessory rights—though the remedy
for nonpayment certainly does where the tenant is still in posses-
sion. The parties have not cited, and we have not found, any cases
either before or after the FSIA dealing with the application of
sovereign immunity to actions for rent against foreign sovereigns.
However, the related local action rule has been applied to rent
suits. According to Tiffany, it would apply or not apply depending
upon whether the suit involved only assignees of the parties to the
original lease (and was thus based only on privity of estate) or
rather involved the original parties to the contract. 3 H. TIFFANY,
REAL PROPERTY §911 at 582 (3d ed. 1939). If this is in fact a
general distinction, it is assuredly not one that all courts have
followed. Some, for example, appear to apply the local action rule
to only those rent suits in which title is in dispute. See, ¢.g.,
Prospect Point Land Improvement Co. v. Jackson, 109 N.J.L. 385,
387, 162 A. 576, 577 (1982); California v. Royal Consolidated
Mining Co., 187 Cal. 343, 351, 202 P. 183, 186-87 (1921). We need
not inquire further into this fascinating issue; or into the more
consequential issue of whether the FSIA was intended merely to
10a
cited by appellants interpreting § 1605(a) (4), County
Board v. Government of the German Democratic Re-
public, Civil No. 78-293-A (E.D. Va. Sept. 6, 1978),
reprinted in 17 Int’l Legal Materials 1404 (1978). In
that case a county taxing authority in the United States
sued a foreign sovereign for delinquent real estate taxes.
An amendment to the complaint added a prayer for de-
claratory judgment that the property in question was
subject to the state’s statutory tax lien in favor of the
county. On the issue of amenability to suit under § 1605
(a) (4) the court held:
Whether or not the issue of rights in immovable
property is present under the original pleadings,
after the amendment of pleadings being allowed
below, the issue will be a specific matter for the
court’s attention in determining the question of the
county’s lien....
Id. at 1405,
To see that appellants’ claims against Mexico are not
of the character involving property interests or posses-
sion to which the § 1605(a) (4) exception attaches, it is
useful to review the manner in which those claims origi-
nated. Under well-established principles of international
law, a sovereign possesses the absolute power to assert
the private claims of its nationals against another sover-
eign. See L. HENKIN, FOREIGN AFFAIRS AND THE CON-
codify the preexisting exception to sovereign immunity in rent
cases (whatever the scope of that might have been), or to extend
that exception to all rent cases, or perhaps (though it seems un-
likely) by the mere mention of the single word “rent” ,in the legis-
lative history to create an entirely new exception where none
existed before. The point for present purposes is that actions for
rent frequently involve issues of title and possession, and have
been given distinctive jurisdictional treatment for that reason.
Reference to such actions in the legislative history of the FSIA
thus does not establish any departure from the traditiona! principle
that the real estate exception to sovereign immunity is bounded
by concern for those issues.
lla
STITUTION 262-63 (1972); RESTATEMENT (SECOND) OF
FOREIGN RELATIONS LAW OF THE UNITED STATES, supra,
at §212. This authority to espouse claims does not de-
pend on the consent of the private claimholder, id. at
§ 213, and the fact that a claim has been espoused pro-
vides a complete defense for the defendant sovereign in
any action by the private individual, id. at § 205. Once
it has espoused a claim, the sovereign has wide-ranging
discretion in disposing of it. It may compromise it, seek
to enforce it, or waive it entirely. See Dames & Moore v.
Regan, 453 U.S. 654, 680 (1981); Administrative Deci-
sion No. V (United States v. Germany), Mixed Claims
Commission, 1924, [1923-25] Ad. Decisions and Ops. 145,
190, 7 U.N. Rep. Int’] Arb. Awards 119, 152. Final
settlement between the sovereigns “wipe[s] out the under-
lying private debt,” L. HENKIN, supra, at 262, and re
leases the defendant sovereign from all obligation except
such as the settlement agreement may provide. In the
present case, it may well be that Mexico, in settling or
waiving the private claims, obligated itself under its own
law to its nationals whose claims it had asserted. This
obligation, however, differs from the legal obligation that
arose from the wrongful taking (wrongful under the law
of the United States or Texas or under the Treaty of
Guadalupe Hidalgo) and that was settled by the 1941
Treaty, in several crucial respects: it is owed by a
different sovereign and derives from the application of
different law to entirely dissimilar and distinct sovereign
acts.
Against this background it is clear that the compensa-
tion rights asserted here are not remotely “rights in im-
movable property” within the meaning of § 1605(a) (4).
They are not property interests in real estate, such as a
leasehold, easement or servitude, nor possessory rights,
nor even rights to payment of money secured by an in-
terest in land. Neither the title to, nor the use of the
Texas lands can conceivably be affected by the outcome of
this suit. Appellants’ predecessors in interest possessed a
12a
claim to title and possession, undoubtedly a “right in
immovable property” at the time. Those property claims,
however, were extinguished by the 1941 Treaty. That
other obligations may have arisen in connection with the
Treaty does not alter the fact that questions of title,
possession and even compensation as between the original
disputants, the United States and appellants’ predecessors
in interest, ceased to exist after 1941. It is true that the
issue whether appellants’ predecessors in interest ever
in fact held title to these lands would, presumably, be
relevant to their entitlement to compensation from Mex-
ico. But that issue is, as far as the United States is
concerned, purely of historical interest, having no bearing
upon present property interests or possessory rights in its
territory. The principal state interest that underlies the
real property exception to sovereign immunity is there-
fore not implicated—as is evident from the fact that the
1941 Treaty, by providing for compensation of the private
claimants by Mexico, implicitly acknowledged that state’s
right to resolve this historical point.
Appellants rely on Comegys v. Vasse, 26 U.S. (1 Pet.)
193 (1828), for the proposition that “payment [of a
claim] under a claims settlement treaty ... [is properly
viewed as] an indemnification for the violation of a pre-
existing property right.” Appellant’s Brief at 15. That
is undoubtedly so, but does not resolve the issue here:
whether the right to indemnification is in the nature of
a real property right for purposes of the FSIA. In
Comegys the United States was in the position of Mexico
here: It had espoused claims against Spain and settled
them, producing an obligation on its part (under the
terms of the settlement treaty) to indemnify the original
claim-holders. The case involved a claim-holder who had
made an assignment in bankruptcy before the United
States had espoused the claim; and the issue was whether
the indemnification should be paid to him or to the as-
signee. The Court held, reasonably enough, that the
indemnification was not a “donation or gratuity,” 26
13a
U.S. at 217, but was rather sufficiently attributable to
the claim against Spain that it should go where that
went—to the assignee in bankruptcy. Obviously, to say
that the second claim goes to the holder of the first is not
to say that it is identical with the first—either in amount
or in its general character as a “real estate” claim—
much less in its character as a “right in immovable prop-
erty” for the specific purpose of the FSIA.®
In summary, while appellants may possess claims
against Mexico for its uncompensated taking of previously
held Texas land claims, resolution of those claims will not
in any conceivable way affect property interests in, or
rights to possession of, land located in the United States.
Accordingly, the claims are not “rights in immovable
property,” within the meaning of 28 U.S.C. § 1605(a) (4).
B. The “Tortious Act” Exception—§ 1605(a) (5).
Appellants assert alternatively that jurisdiction over
Mexico exists under § 1605(a) (5). That paragraph cre-
ates an exception to foreign sovereign immunity for cases
not otherwise encompassed [by the exception for a
foreign state’s commercial activity], in which money
damages are sought against a foreign state for per-
sonal injury or death, or damage to or loss of prop-
erty, occurring in the United States and caused by
the tortious act or omission of that foreign state or
of any official or employee of that foreign state while
acting within the scope of his office or employ-
ment....
® Comegys also differed from the present case in that the claim
had already been adjudicated by an international commission and
found to be meritorious before it was espoused. Thus, the holding
does not even establish that an espoused but unadjudicated claim
such as existed here necessarily leaves any post-settlement rights
in the original claimant. Cf. Dames & Moore v. Regan, supra,
453 U.S. at 688 n.14 (Court declines to decide whether U.S. citizen
has a taking claim against United States when his unadjudicated
private claim is waived or settled for less than fair value).
l4a
(Emphasis added.) Appellants claim that Mexico’s failure
to compensate them for its taking and use of their Texas
land claims is a violation of international and domestic
(presumably Mexican) law, and thus wrongful and
“tortious” within the scope of § 1605(a) (5).
We need not pause to consider whether Mexico has en-
gaged in tortious conduct under applicable law, or which
law might be applicable, because it is clear that the con-
duct complained of lacks the required nexus with the
United States.’ Although the statutory provision is sus-
ceptible of the interpretation that only the effect of the
tortious action need occur here, where Congress intended
such a result elsewhere in the FSIA it said so more ex-
plicitly. See 28 U.S.C. § 1605(a) (2) (immunity withheld
for acts “outside the territory of the United States in
connection with a commercial activity of the foreign state
elsewhere and that act causes a direct effect in the United
States”). The legislative history makes clear that for the
exception of § 1605(a) (5) to apply “the tortious act or
omission must occur within the jurisdiction of the United
States.” House Report, supra, at 21, 1976 U.S. CoDE
Conc. & AD. NEws 6619. We have recently so held.
Persinger v. Islamic Republic of Iran, 729 F.2d 835, 842
(D.C. Cir. 1984).
It is not contended in the present case that any of
Mexico’s acts that could conceivably be regarded as hav-
ing been committed on United States soil—the espousal,
presentation and settlement of the claims—was in and of
itself tortious. The gravamen of appellants’ tort claim is
not these acts but the subsequent failure to compensate,
7™The District Court found § 1605(a)(5) inapplicable because
the Mexican conduct complained of fell within the “discretionary
act” exception to the tort exception. 28 U.S.C. § 1605(a) (5) (A)
(“[the tort exception] shall not apply to—(A) any claim based
upon the exercise or performance or the failure to exercise or per-
form a discretionary function regardless of whether the discretion
be abused”). We also do not reach that issue.
15a
an omission which must be deemed to oceur in Mexico.
Even if the allegedly wrongful failure to compensate had
the effect of retroactively rendering the prior acts on
United States soil tortious, at the very least the entire
tort would not have occurred here, see In re Sedco, Inc.,
543 F. Supp. 561, 567 (S.D. Tex. 1982) (“the tort, in
whole, must occur in the United States”), and indeed we
think its essential locus would remain Mexico. The pri-
mary purpose of the “tortious act or omission” exception
of § 1605(a) (5) was to enable officials and employees of
foreign sovereigns to be held liable for the traffic acci-
dents which they cause in this country, whether or not in
the scope of their official business. House Report, supra,
at 20-21, 1976 U.S. CopE Conc. & AD. NEWS 6619-20. We
decline to convert this into a broad exception for all
alleged torts that bear some relationship to the United
States.
Affirmed
EDWARDS, Circuit Judge, concurring: I concur in
Judge Scalia’s opinion for the panel, with one caveat. I
want to make it clear that I read the holding of the opin-
ion as limited by and responsive to the precise—and
highly unique—case before us. In particular, I do not
read the opinion to hold that, in a contemporary setting,
the United States can unlawfully expropriate property
legitimately owned by aliens in this country, consummate
a treaty with a foreign sovereign extinguishing the aliens’
property rights without compensation or consideration,
and then totally avoid responsibility under our Constitu-
tion or other applicable laws of this Nation. We have no
occasion to consider such a situation here and we express
no view on its legality.
16a
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA
September Term, 1983
Civil Action No. 81-02299
No. 83-1596
ASOCIACION DE RECLAMANTES, et al.,
Appellants
V.
THE UNITED MEXICAN STATES
[Filed June 5, 1984]
ORDER
It is ORDERED, sua sponte, that the Clerk shall with-
hold issuance of the mandate herein until seven days
after disposition of any timely petition for rehearing.
See Local Rule 14, as amended on November 30, 1981
and June 15, 1982. This instruction to the Clerk is with-
out prejudice to the right of any party at any time to
move for expedited issuance of the mandate for good
cause shown.
FOR THE COURT
GEORGE A. FISHER
Clerk
17a
APPENDIX B
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
Civil Action No. 81-2299
ASOCIACION DE RECLAMANTES, et al.,
Plaintiffs,
Vv.
THE UNITED MEXICAN STATES,
Defendant.
[Filed April 20, 1983]
MEMORANDUM OPINION AND ORDER
I. Introduction
This case is before the Court on a motion to dismiss.
It involves a class action brought by the Asociacion de
Reclamantes and six individual plaintiffs seeking com-
pensation from the United Mexican States (‘Mexico’)
for its alleged taking and conversion of certain land
grant related claims possessed by plaintiffs or their an-
cestors.
Mexico asserts that the Court lacks subject matter
jurisdiction to hear this case as well as personal juris-
diction over Mexico, and that even if the Court assumes
jurisdiction, the act of state doctrine precludes it from
exercising its jurisdiction and resolving the controversy
between the parties.
Counsel filed excellent briefs in this case and their ar-
guments before the Court on January 16, 1983 were ex-
18a
ceedingly helpful in weighing the multitude of contested
and competing issues. As the Court noted at the hearing
in this case, the alleged injuries to plaintiffs are not only
serious and entitled to careful review, but give the Court
great concern. Mindful of those considerations, and in
accordance with the opinion which follows, the Court
holds that it is without subject matter jurisdiction and
that the case must be dismissed.
II. Facts
In evaluating a motion to dismiss for lack of subject
matter jurisdiction under Fed. R. Civ. P. 12(b) (1), the
Court must accept as true all material facts alleged in
the complaint. Williamson v. Tucker, 645 F.2d 404, 412-
13 (5th Cir. 1981) (on rehearing; Menchaca v. Chrys-
ler Credit Corp., 613 F.2d 507, 511 (5th Cir. 1980),
cert. denied, 449 U.S. 953 (1980); Mortensen v. First
Federal Savings & Loan Ass’n, 549 F.2d 884, 891-92 (3d
Cir. 1977); Airline Pilots Ass’n Int'l v. Northwest Air-
lines, Inc., 444 F. Supp. 1138, 1142 (D.D.C. 1978). Only
where the defendant raises a factual challenge to the
jurisdictional facts in the complaint need the court look
beyond plaintiff’s allegations. Jd. Here, the defendant
has not challenged plaintiff’s jurisdictional facts, but
rather asserts that on their face, they fail to invoke the
power of this Court.
Likewise, in evaluating defendant’s motion to dismiss
for failure to state a claim under Fed. R. Civ. P. 12(b)
(6), the Court must also accept as true all material facts
alleged in the complaint. Mortensen v. First Federal
Savings & Loan Ass’n, 549 F.2d at 891.
Plaintiffs’ claims stem, in part, from the upheaval
caused by the Mexican-American War. At the cessation
of hostilities, sovereignty over Texas was transferred
from Mexico to the United States under the Treaty of
Guadalupe Hidalgo, 9 Stat. 922, T.S. No. 207 (Feb. 2,
19a
1848). In the years which followed, plaintiffs’ ancestors,
who owned land in Texas,’ were allegedly driven off their
land or wrongfully divested of title by the United States,
Texas, or the citizens thereof. These actions occurred in
spite of provisions in the 1848 Treaty providing that the
former Mexican landowners’ land grants were entitled to
the protection and respect of the United States. Art.
VIII, Treaty of Guadalupe Hidalgo, supra.
No allegation is made that plaintiffs’ ancestors sought
the return of, or compensation for, their land in a United
States forum since 1848. Rather, plaintiffs’ ancestors,
many of whom returned to Mexico, convinced the Mexi-
can Government to pursue their claims through diplo-
matic channels in the early 1920s. Under a 1923 General
Claims Treaty between the United States and Mexico, 43
Stat. 1730, T.S. No. 678 (Sept. 8, 1923), the nations cre-
ated a General Claims Commission to resolve all claims
by citizens of each nation against the other contracting
nation. The Commission was directed to quantify the
number and size of the claims, and to the extent the ag-
gregate claims of the citizens of either nation exceeded
the other nation’s aggregate claims, the difference would
be repaid sovereign to sovereign.? Each sovereign would
then be responsible for providing compensation to its own
citizens.* By 1940, only a few of the 483 claims sub-
mitted by Mexico on behalf of plaintiffs are alleged to
have been evaluated.
1 The land in question involves 433 land grants from Spain and
Mexico to the ancestors of plaintiffs and consists of approximately
12 million acres of land lying principally between the Rio Grande
and the Nu[el]ces River in South Texas.
2 United States citizens also had claims of expropriation or
wrongful taking of property against Mexico and its citizens, in
large part as a result of the Mexican Revolution.
3In 1934 the General Claims Commission was replaced by two
special claims appraisers using a revised appraisal process.
20a
Fueled by the expropriation of American oi! company
properties in Mexico in 1938, the two sovereigns went to
the bargaining table again in 1940. These negotiations
allegedly included the 433 land grant claims at issue in
this case, and resulted in the payment of $40 million by
Mexico to the United States, an amount by which it was
found the aggregate United States claims exceeded the
aggregate Mexican claims. Treaty on Final Settlement of
Certain Claims, 56 Stat. 1347, T.S. No. 980 (Nov. 19,
1941). Plaintiffs further allege that the total value re-
ceived by Mexico (i.e., total claims against Mexico re-
leased) was in excess of $193 million, and that:
Mexico’s release of the United States from liability
on the 433 land grant related claims, in exchange for
valuable consideration, constituted a use and taking
by Mexico of those claims for its own public pur-
poses, including the reduction of Mexico’s financial
liabilities to the United States. As a result, Mexico
became obligated to pay just, effective and prompt
compensation for the 433 land grant related claims.
Complaint par. 29.
Shortly after the treaty was signed, the then President
of Mexico issued a decree acknowledging Mexico’s as-
sumption of the obligation for the land grant related
claims, which, in part, stated:
FOREIGN AFFAIRS DEPARTMENT, DECREE
BY WHICH IT IS ORDERED THAT A LAW BE
ENACTED FOR THE SETTLEMENT, VALUA-
TION, AND PAYMENT OF THE CLAIMS PEND-
ING BETWEEN MEXICO AND THE UNITED
STATES OF AMERICA.
Whereas the Convention regarding claims, signed
on the 19th of November of the current year, by the
Governments of Mexico and the United States of
America, annuls all of the Mexican Claims filed be-
fore the General Claims Commission. .. .
21a
Whereas it is the duty of the Government to tend
to said claims of our nationals in order to satisfy
them in accordance with the role played in the re-
cently executed convention with our neighbor coun-
try to the north and in accordance with rules of
euuity ....
Whereas the claims referred to have lost their in-
ternational character, and have become internal obli-
gations of our government....
Whereas it is necessary to have a law enacted by
the honorable Congress of the Union indicating the
appropriate procedure for evaluating the claims re-
ferred to in this Decree, to judge them and te ascribe
to them the compensation to which they are entitled,
honoring the findings dictated by the international
jurisdictions that have decided some of them....
Decree
I. The Secretariat of Finance shall immediately
proceed to study and prepare a plan, which shall be
submitted to the honorable Congress of the Union,
involving a law for the settlement, valuation, and
payment of the Mexican claims presented to the ex-
tinct General Claims Commission, established by vir-
tue of the agreement between Mexico and the United
States of America on September 8, 1923 ....
129 D.O. See. 5 at 1-2 (Dec. 31, 1941) (original and
translation submitted as Plaintiffs’ Exh. E). Thereafter,
the Secretariat of Public Finance and Credit acting
through the Department of Public Debt of the Adminis-
tration of Credit sent several letters to plaintiffs assur-
ing them a law would be enacted and compensation paid.
Plaintiffs’ Exhibits F, G & H. In addition, plaintiffs re-
peatedly met with Mexican officials to discuss payment of
compensation and allegedly were assured that payment
was forthcoming.
22a
On September 18, 1981, plaintiffs filed their initial
class action in this case, and pursuant to an order of this
Court filed a First Amended Complaint on December 18,
1981. On June 17, 1982, discovery was stayed pending
a ruling on Mexico’s motion to dismiss filed on February
2, 1982. As of this point in time, the plaintiffs assert
that no legislation providing for compensation has been
enacted in Mexico and Mexico appears to agree. Mexico
attached a declaration of its Attorney General stating
that: (1) he is authorized to issue official declarations in
the name of the Mexican government; (2) he has ex-
amined the Complaint in this case; and (3) “that all acts
and failures to act by officials or employees of the United
Mexican States ... are a part of the official functions
and would be official acts of the Mexican State carried
out on its behalf and in the exercise of its sovereign im-
munity.” Official Declaration of the Attorney General,
Republic of Mexico (Jan. 29, 1982) (original and trans-
lation attached as Exhibit A to Defendant’s Memoran-
dum in Support of its motion to dismiss).
III. Discussion
Mexico asserts three principal grounds in support of
its motion to dismiss: (1) lack of subject matter juris-
diction; (2) lack of personal jurisdiction; and (3) failure
to state a claim.* The question of personal jurisdiction
is subsumed, however, by the first ground under the For-
eign Sovereign Immunities Act (“FSIA”).®
* Mexico also raises the statute of limitations as a defense, how-
ever, the Court does not reach that issue due to the lack of subject
matter jurisdiction over the defendant.
528 U.S.C. Sec. 1330(b) provides that:
Personal jurisdiction over a foreign state shall exist as to every
claim for relief over which the district courts have [subject
matter) jurisdiction under subsection (a) where service has
been made under section 1608 of this title...
A joint motion and stipulation agreeing that service was proper
was filed on December 4, 1981 and accepted by the Court on
23a
A. Subject Matter Jurisdiction
Plaintiffs allege subject matter jurisdiction under 28
U.S.C. Sec. 1330(a) and 28 U.S.C. Sec. 1331. Defendant
responds that 28 U.S.C. 1330(a) is the exclusive statu-
tory grant of jurisdiction, and that pursuant to its pro-
visions, Mexico is immune as a sovereign from the power
of this Court. The Court finds that the question of juris-
diction under 28 U.S.C. Sec. 1331 is a non-issue. For if
Mexico is immune under the FSIA, it is, as plaintiff con-
cedes, “of no consequence whether Sec. 1331 jurisdiction
exists as well.” °
The existence of subject matter jurisdiction turns on
whether Mexico’s acts or omissions fall within the gen-
eral rule of immunity, 28 U.S.C. Sec. 1604; or are ex-
cepted from jurisdiction immunity under 28 U.S.C. Sec.
1605(a)(4) or (5). The plain language of the FSIA
provides:
Subject to existing international agreements to
which the United States is a party at the time of
enactment of this Act a foreign state shall be im-
December 15, 1981. Therefore, all that remains to be decided is
whether there is (a) subject matter jurisdiction, id., and (b) a
justiciable claim under the FSIA. 28 U.S.C. Sec. 1330(c). See
In the Matter of the Arbitration Between Maritime International
Nominees Establishment v. Republic of Guinea, 693 F.2d 1094,
1099-1100 (D.C. Cir. 1982).
* Plaintiff's Memorandum in Opposition to the Motion to Dis-
miss the Complaint, at 4 n.5 (April 5, 1982). The Court notes
that the greater weight of authority suggests that Sec. 1330 is the
exclusive means for exercising jurisdiction over a foreign sovereign.
It was enacted as part of the FSIA “to provide when and how
parties can maintain a lawsuit against a foreign state...” and to
ensure parties have a federal forum without needing to invoke
diversity jurisdiction. H. Rep. No. 94-1487, 94th Cong., 2d Sess.
61, 18 (1976). See Maritime Int'l] Nominees v. Republic of Guinea,
supra, 693 F.2d at 1099; Ruggiero v. Compania Puruana de
Vapores, S.A., 639 F.2d 872, 875 (2d Cir. 1981).
24a
mune from the jurisdiction of the courts of the
United States and of the States except as provided
in sections 1605 to 1607 of this chapter.
28 U.S.C. Sec. 1604. Plaintiffs do not rely on an “exist-
ing international agreement” but solely on the above
cited exceptions in Sec. 1605. In evaluating plaintiffs’
assertions, the Court must respect the Congressional di-
rective that claims of sovereign immunity “henceforth be
decided by courts” in accordance with the FSIA, and not
by deference to political and diplomatic channels. 28
U.S. Sec. 1602.’
The House Report explains:
.. . the bill would codify the so-called “restrictive”
principle of sovereign immunity, as presently recog-
nized in international law. Under this principle, the
immunity of a foreign state is “restricted” to suits
involving a foreign state’s public acts (jure imperii)
and does not extend to suits based on its commercial
or private acts (jure gestionis). This principle was
adopted by the Department of State in 1952 and has
been followed by the courts and by the executive
branch ever since. Moreover, it is regularly applied
against the United States in suits against the U.S.
Government in foreign courts.
H. Rep. No. 94-1487, supra, at 7. The parties’ dispute
involves, and jurisdic: »n turns on whether Mexico’s ex-
propriation of, and continuing failure to pay, plaintiffs’
claims are jure imperii or jure gestionis.
7 The Congress became dissatisfied with the State Department
practice of making formal suggestions of sovereign immunity in
suits against foreign sovereigns. They often resulted in incon-
sistent decisions due to unequal abilities on the part of foreign
sovereigns to bring diplomatic influences to bear on the State
Department— influences which could deny litigants due process and
may not have been relevant to the decision. H. Rep. No. 94-1487,
supra, at 7.
ee
25a
At first blush, it appears that Mexico’s acts or omis-
sions are public acts. Mexico officially traded plaintiffs’
claims in international negotiations with the United
States and by treaty and executive decree, assumed and
acknowledged its responsibility to plaintiffs to compen-
sate them for their claims. As recertly as January 29,
1982, the Attorney General of Mexico acknowledged the
claims. The claims, however, could not be for title, but
for compensation for the wrongful taking of title in the
19th Century.* When the claims were before the General
Claims Commission, the United States was in a position
to consider offering land as compensation, but such a re-
sult was neither likely nor obligatory; particularly where
the 1923 treaty recognized that the claims of each na-
tion’s citizens, resulting from a variety of unrelated cir-
cumstances, were to be set off against one another and
resolved on the diplomatic level—allowing each nation to
deal with its citizens directly.
The Court finds that plaintiffs’ claims, at least since
1923, while they may have their genesis in a wrongful
taking of property, were no more than just that: claims.
The Court further finds, as both parties concede, that by
virtue of the 1923 and 1941 treaties, the claims became
internal obligations of Mexico. While Mexico’s decision
to assume responsibility for plaintiffs’ claims may amount
to an expropriation, it is by no means clear that the
plaintiffs had any rights whatsoever against the United
States once their remedies to quiet title expired. Before
Mexico can provide a remedy, it must first evaluate and
raise money to cover the claims. This is by no means a
ministerial task, and requires, at a minimum, public ac-
tion by the Mexican Government.
* There is no allegation by plaintiffs that they or their ancestors
sought to retain or quiet title within the applicable statute of
limitations after the alleged wrongful takings occurred. Moreover,
Mexico has no power over title to land within the United States
under the 1941 treaty.
EE
26a
Plaintiffs respond, however, that the FSIA recognizes
that satisfaction of every claim, whether it be commercial
or tort, requires a public act, and that 28 U.S.C. Sec.
1605 was enacted to codify the “restrictive” principle of
sovereign immunity and guide the courts in applying the
doctrine.* Accordingly, the Court finds it necessary to
evaluate plaintiffs’ assertion of exceptions (4) and (5)
of Section 1605.”
®Compare Victory Transport, Inc. v. Comisaria General de
Abastecimientos y Transportes, 336 F.2d 354 (2d Cir. 1964) (sov-
ereign held immune prior to enactment of FSIA in connection
with a commercial loan obtained for general governmental pur-
pose), cert. denied, 381 U.S. 934 (1965).
10The Court notes that there is a question whether Mexico's
“internal obligation” can fall within any of the exceptions to section
1605.
In a section-by-section analysis prepared by the Departments of
State and Justice in 1973, the view was expressed that:
Public debts do not fall within the scope of 1605. The immunity
of foreign states in this respect should be maintained by the
United States, in its role as one of the principal capital markets
of the world....
Immunities of Foreign States: Hearings on H.R. 3493, Before the
Subcomm. on Claims and Government Relations of the H. Comm. on
the Judiciary, 93d Cong., Ist Sess. 42 (1973) (hereinafter “1973
Hearings”). The Court is mindful of Congress’ instructions not
to consult the 1973 section by section analysis in construing the
FSIA and that no inferences should be drawn by differences be-
tween the 1973 analysis and the FSIA. H. Rep. No. 94-1487,
supra, at 12. For this reason, the Court is not relying on any
“differences,” but instead notes the following contemporaneous
constructions of the bill.
When the FSIA was first proposed it contained proposed Section
1606 which provided that all debts of sovereigns would remain
beyond the jurisdiction of the U.S. courts. See H.R. 11315, 93d
Cong., Ist Sess. (1973) ; H.R. 11315, 94th Cong., Ist Sess. (1975) ;
1973 Hearings, supra, at 42. Ultimately, the provision was deleted
from H.R. 11315. The Committee found it unnecessary because
U.S. lenders “invariably include an express waiver of immunity
in the debt instrument.” H. Rep. No. 94-1487, supra, at 10; S. Rep.
No. 1310, 94th Cong., 2d Sess. 7 (1976). Proposed section 1606
27a
1. The Immovable Property Exception—Sec. 1605
(a) (4)
Under 28 U.S.C. Sec. 1605(a):
A foreign state shall not be immune from the juris-
diction of courts of the United States... in any
case—(4) in which rights in property in the United
States acquired by succession or gift or rights in
immovable property situated in the United States are
in issue... .
Notably, this exception to the general rule of sovereign
immunity contains two independent triggering clauses.
The first clause speaks of “rights in property in the
United States acquired by succession or gift” and the
second speaks of “rights in immovable property situated
was ambiguous in that it applied to all debts, not just general
governmental obligations. The State Department considered
amending it but then decided that no provision was better than
a more precise provision which identified only non-commercial
debts for general government obligations as eligible for per se
sovereign immunity. Jurisdiction of the U.S. Courts in Suits
Against Foreign States: Hearings on H.R. 11315 Before the Sub-
comm. on Administrative Law and Government Relations of the
H. Comm. on the Judiciary, 94th Cong., 2d Sess. 69, 75 (1976).
The 1976 House Report specifically discusses the deletion of pro-
posed section 1606 to which the above quoted passage referred.
The Committee appears to have ignored the fact that a public
debt could exist in other than the commercial lending context. It
merely suggests that only public debts “which are of a commercial
nature and should be treated like other commercial transactions”
are excepted from sovereign immunity. Jd. The non-commercial
debt obligation is thus arguably immune by implication and may
place the “internal obligations” in dispute in this case outside the
scope of the Section 1605 exceptions.
This is in accordance with the historical meaning of a “public
debt,” which was considered a per se public act and a sufficient
basis for sovereign immunity. See, e.g., Letter from Jack B. Tate,
Acting Legal Advisor, U.S. Dept. of State, to the Attorney General
(May 19, 1952), reprinted in Alfred Dunhill of London, Inc. v.
Republic of Cuba, 425 U.S. 682, 711-15 (1976).
28a
in the United States.” Plaintiffs’ make a formalistic ar-
gument that the first phrase was drafted to deal with all
kinds of property (real, personal or intangible) acquired
by succession or gift and that the second phrase was
drafted to deal with suits involving rights in immovable
property. Plaintiffs assert that both clauses apply to its
claims against Mexico. They argue alternatively that
their claims arise from rights in “immovable property,”
as well as concern inherited intangible property (i.e.,
claims) located in the United States. The Court dis-
agrees.
Since the beginnings of positive law, attorneys have
argued over the plain meaning of statutes. See Graff,
“Keep Off the Grass,” “Drop Dead,” and Other Indeter-
minacies: A Response to Sanford Levinson, 60 Tex. L.
Rev. 405 (1982). Plaintiffs first seek to establish that
their claims are a “usufructuary” interest** and thus a
right in “immovable property.” The difficulty with this
assertion is it assumes plaintiffs had a colorable legal
right to title in 1923 when Mexico and the United States
agreed to consider their claims at the diplomatic level.
When sovereigns sit down at the bargaining table, as
Mexico and the United States did in 1923, 1934 and
1941, a multitude of considerations may effect a decision
to recognize a claim, considerations which may not be
cognizable at law. Plaintiffs have not alleged that they
had title to the land in 1923 or that they attempted to
regain title in a legal forum prior to that time. All they
have alleged is the United States’ acknowledgment, at the
diplomatic level, of plaintiffs’ rights to prove their claims,
and that Mexico assumed the United States’ obligation to
satisfy the claims. As a result, it requires a stretch of
the Court’s imagination to hold that the underlying con-
troversy » this suit involves an action to quiet title or to
recover money derivative of real property rights. See
11 See La. Civ. Code Ann. Arts. 462-470, 575 (West 1980);
Mexican Civ. Code Arts. 750, 980 (Ediciones Andrade 1976).
29a
Bachman v. Lawson, 109 U.S. 659 (1884); Comegys, et
al. v. Vasse, 26 U.S. (1 Pet.) 193 (1828). Rather, the
Court holds that plaintiffs’ claims, however meritorious
they appear on the scales of justice, involve intangible
property rights created through the diplomatic process.
Cf. Matter of Rio Grande Transport, 516 F. Supp. 1155,
1160 (S.D.N.Y. 1981) (a liability compensation fund is
not real estate and thus not immovable property).
Plaintiffs alternatively argue that their claims fall
within the meaning of inherited property under section
1605(a) (4). This assertion must also fail. If the Court
were to adopt plaintiffs expansive reading of the FSIA,
any claim or chose in action involving inherited property
(real, personal or intangible) would be excepted from the
rule of sovereign immunity. Because every dispute with
a foreign sovereign necessarily involves these kinds of in-
tangible rights, every dispute in plaintiffs’ view would be
excepted from sovereign immunity when it passes by gift
or succession. This is contrary to the purpose of the
FSIA.
The FSIA codified the existing “restrictive” principles
of sovereign immunity in section 1605. H. Rep. No. 94-
1487, supra, at 7. Congress included the succession clause
(“rights in property in the United States acquired by
succession or gift”) to ensure that real, personal and in-
tangible property rights were justiciable where a foreign
sovereign steps into the shoes of a private litigant by
obtaining rights in property through a gift or inheritance.
H. Rep. No. 94-1487, supra, at 20. See generally Restate-
ment (Second) of the Foreign Relations Law of the
United States (Revised) sec. 455 (Tent. Draft No. 2,
1981). It did not intend to open the courts to all suits
involving inherited or donated property.
2. The Tort Exception—28 U.S.C. Sec. 1605(a) (5)
Plaintiffs next rely on the tort exception to invoke the
jurisdiction of the Court. They reason that Mexico as-
80a
sumed a duty to compensate plaintiffs in the United States
when it signed the 1941 treaty, and that the continuing
failure to provide such compensation amounts to a con-
version of plaintiffs’ claims.
Section 1605(a) (5) provides for limited jurisdiction
over tort claims:
A foreign state shall not be immune from the ju-
risdiction of the courts of the United States... in
any case ... in which money damages are sought
against a foreign state for personal injury or death,
or damage to or loss of property, occurring in the
United States and caused by the tortious act or omis-
sion of that foreign state or of any official or em-
ployee of that foreign state while acting within the
scope of his office or employment; except this para-
graph shall not apply to—
(A) any claim based upon the exercise or per-
formance or the failure to exercise or perform
a discretionary function regardless of whether
the discretion be abused... .
28 U.S.C. sec. 1605(a) (5). As noted above, plaintiffs do
not assert, nor is it clear that they possessed, legal claims
against the United States. They argue instead that what-
ever the status of their claims against the United States,
Mexico acknowledged their validity, assumed responsibil-
ity, and converted their rights.
The settlement of claims between sovereigns, in which
each sovereign agrees to compensate its own citizens, does
not create a private right of action in U.S. courts for a
taking or conversion resulting from the failure of the
United States to provide the agreed upon compensation.
Aris Gloves, Inc. v. United States, 420 F.2d 1386 (Ct. Cl.
1970). See Restatement (Second) of the Foreign Rela-
tions Law of the United States (Revised) sec. 721 n.8
(Tent. Draft No. 3, 1982); L. Henkin, Foreign Affairs
and the Constitution 262-63 (1972). The rationale for
3la
this rule applies with greater force in this case where
the Court is asked to intervene in a foreign sovereign’s
relations with plaintiffs under a treaty. Not only does it
require a review of the actions of the Mexican Govern-
ment, but it requires an implicit reversal of the decision
by the Executive Branch and Congress to entrust the
compensation of plaintiffs to Mexico in 1941. The Court
is doubtful whether it has any authority, absent extraor-
dinary and compelling circumstances, to exercise juris-
diction over the foreign affairs of the United States.”
Even assuming this case warrants judicial interven-
tion and that Mexico’s continuing failure to compensate
plaintiffs constitutes a taking or conversion of plaintiffs’
claims, plaintiffs still concede that the “highest authori-
ties” of the Mexican Government including the President
and the Legislature have failed to act. The evaluation,
financing, and payment of plaintiffs’ claims are not min-
isterial matters. See In re Complaint of Sedco, Inc., 543
F.2d 561 (S.D. Tex. 1982). Cf. Dalehite v. United States,
346 U.S. 15, 35-36 (1953). The judgments are not
merely operational, but raise substantial and serious ques-
tions of fiscal policy, and the allocation of limited re-
sources.** Moreover, Professor Henkin persuasively
writes, with respect to the settlement of claims by the
United States, that:
No one has successfully argued in the Supreme
Court that in purporting to dispose of private claims,
in the details of a particular settlement, in the pro-
cedures established for making awards to private
12 See discussion, infra, at pages 22-27.
13 A few of the claims were processed by the General Claims
Commission before 1941, and Mexico agreed to honor those de-
cisions. See Presidential Decree, 129 D.O. sec. 5, supra at pages
5-6. Those findings, however, only went to the validity of the
claims and their valuation. Even if honoring those findings is
ministerial, funding them is certainly not.
32a
claimants, in Congressional legislation providing (or
failing to provide) for award and payment, the
United States deprived the original claimants of
property without due process of law, impaired the
obligation of their contracts or appropriated their
claims for a public purpose and was obligated to pay
them just compensation for any loss. The Court has
refused to scrutinize any settlement and has affirmed
that Congress has discretion to decide whether and
how and to what extent to compensate the original
creditors.
L. Henkin, Foreign Affairs and the Constitution, 263
(1972) (footnotes omitted). These considerations are
high-level policy judgments, requiring deference to the
expertise and discretion of the United States Congress
and the Executive Branch. This Court finds it should
defer under 28 U.S.C. sec. 1605(a) (5) to the expertise
of the Mexican Government, regardless of whether that
judgment, in the Court’s or plaintiffs’ views, is an abuse
of discretion.
The Court is sympathetic to the plaintiffs’ dilemma.
The alleged delays on Mexico’s part offend its sense of
fair play and justice, but it must also respect its juris-
dictional boundaries. Because, however, jurisdiction un-
der the tort exception is barred with respect to all mat-
ters “based upon the exercise or performance or the fail-
ure to perform a discretionary function,” the Court holds
the alleged conversion of or failure to honor plaintiffs’
claims extend beyond the parameters of federal subject
matter jurisdiction."*
14 An additional basis for declining jurisdiction, on which the
Court does not rely, is that assuming Mexico converted plaintiffs’
claims and committed a tort, the tort occurred in Mexico and did
not affect property in the United States. See Perez v. The Bahamas,
652 F.2d 186, 189 (D.C. Cir.), cert. denied, 102 S. Ct. 8326 (1981).
As noted above, the alleged tort involves the conversion of claims
against Mexico, not property in the United States.
33a
B. The Act of State Doctrine
In reaching its decision, the Court is guided by the
act of state doctrine.” Sovereign immunity and the act
of state doctrine are generally independent concerns, and
the former is binding while the latter is subject to dis-
cretionary application. See int'l Ass’n of Machinists &
Aerospace Workers v. Org. of Petroleum Exporting Coun-
tries, 649 F.2d 1854, 1859 (9th Cir.), cert. denied, 454
S. Ct. 1163 (1982) (hereinafter “OPEC” ). The Court in
OPEC explained:
The doctrine of sovereign immunity is similar to
the act of state doctrine in that it also represents the
need to respect the sovereignty of foreign ‘states.
The two doctrines differ, however, in significant re-
spects. The law of sovereign immunity goes to the
jurisdiction of the court. The act of state doctrine
is not jurisdictional. Ricaud v. American Metal Co.,
246 U.S. 304, 309 ... (1918). Rather, it is a pru-
dential doctrine designed to avoid judicial action in
sensitive areas. Sovereign immunity is a principle
of international law, recognized in the United States
by statute. It is the states themselves, as defendants,
who may claim sovereign immunity. The act of state
doctrine is a domestic legal principle, arising from
the peculiar role of American courts. It recognizes
not only the sovereignty of foreign states, but also
the spheres of power of the co-equal branches of our
government . . . The act of state doctrine is apposite
whenever the federal courts must question the legai-
ity of the sovereign acts of foreign states.
649 F.2d at 1359.*°
15 Cf. Fountain v. Metro. Atlanta Rapid Transit Authority, 678
F.2d 1038, 1041 (11th Cir. 1982) (“federal courts should be
scrupulous in confining their use of judicial power to the precise
limits set by the Constitution and Congress.’’).
16 The court went on to hold that the FSIA could not and does
not supersede the act of state doctrine. Jd. at 1359-60.
34a
Many, if not all, of the issues raised under the FSIA
involve the acts or omissions of the Mexican Govern-
ment, and even assuming the FSIA did not preclude
jurisdiction, consideration of those issues are at best on
the fringe of judicial authority.
The Supreme Court ruled in Underhill v. Hernandez,
168 U.S. 250, 252 (1897) that:
Every sovereign State is bound to respect the inde-
pendence of every other sovereign State, and the
courts of one country will not sit in judgment on the
acts of the government of another done within its
own territory.
See also Alfred Dunhill of London, Inc. v. Republic of
Cuba, 425 U.S. 682 (1976); D’Angelo v. Petroleos Mewxi-
canos, 422 F. Supp. 1280 (D. Del. 1976), aff'd, 564 F.2d
89 (3d Cir. 1977). Plaintiffs contend that the doctrine
does not apply to this case because Mexico has failed to
prove an act of state affecting property or persons over
which Mexico is the sovereign. Plaintifis must concede
and in fact they allege that the Mexican Government has
failed to act. They rely, however, on three alleged facts:
(1) Mexico has not yet proven an act of state sufficient
to warrant application of the doctrine at this stage of the
litigation; (2) plaintiffs’ claims are located in the United
States and are not subject to the sovereignty of Mexico;
and (3) the act of state doctrine is discretionary and is
unnecessary in the case because the validity of Mexico’s
acts are not in issue.
In Alfred Dunhill, supra, the Court held that Cuba
could not rely on the assertions of counsel that the failure
to pay a debt was an act of state. 425 U.S. at 694-95.
In this case, however, plaintiffs base their claim on Mex-
ico’s failure to act, which the Court assumes to be true
35a
for the purpose of this motion.” No further proof is re-
quired unless plaintiffs contend that the failure to act is
not an act of state; an assertion which has little, if any,
merit. D’Angelo v. Petroleos Mexicanos, 422 F. Supp. at
1290 (“Non-action as well as affirmative conduct of a
governmental agency, if based upon sovereign govern-
mental authority, can have the status of an act of
ers F
Plaintiffs’ reliance on the situs of their claims is like-
wise misplaced. As discussed above, and as plaintiffs con-
cede, their claims were assumed by Mexico in return for
an assumption of American claims by the United States.*®
At no time prior to the transfer did plaintiffs establish
a legal right to their claims prior to Mexico’s assump-
tion.?®
For the Court to accept plaintiffs’ argument, it would
first have to hold that any person who has a claim against
a foreign sovereign could transfer situs of the claim to
the United States by moving to the United States.
Clearly, such a holding distorts the doctrine whose appli-
cation does not focus as much on the situs of property,
but on whether a court in ordering relief would unduly
interfere with the foreign affairs authority of the execu-
tive branch. See Tabacalera Severiano Jorge, S.A. v.
Standard Cigar Co., 393 F.2d 706, 715 (5th Cir.) cert.
denied, 393 U.S. 924 (1968); Maltina Corp. v. Cawy
Bottling Co., 462 F.2d 1021, 1027 (5th Cir.), cert. denied,
409 U.S. 1060 (1972). Unlike Maltina, Mexico is not
seeking extra-territorial enforcement of an act of state
(i.e., a corporate dissolution), but respect for its discre-
17 The affidavit of Oscar Flores, Attorney General of Mexico,
attached to Defendant’s motion as Exhibit A, merely confirms the
allegations in plaintiffs’ Complaint and is unnecessary for the
Court to reach its holding.
18 See discussion, supra, at pages 4-5.
18 Jd,
36a
tion to handle plaintiffs’ claims. Jd. at 1025-26.” Nor is
Mexico or any other party seeking to impose the effect
of Mexico’s acts on property located in the United States.
Finally, plaintiffs ask the Court to use its discretion
and not apply the doctrine. As noted above, however, the
issues before the Court, both in determining jurisdiction
and, if it had been necessary, in affording ultimate relief,
would require the Court to exercise its power in zones of
influence delegated by the Constitution to the executive
and legislative branches.
“There is a long history of [executive] governmental
action compensating our own citizens out of foreign assets
in this country for wrongs done them by foreign govern-
ments abroad.” Sardino v. Federal Reserve Bank of New
York, 361 F.2d 106, 112 (2d Cir.), cert. denied, 385 U.S.
898 (1966). Frequently, they are the result of claims
settlement negotiations on the suvereign to sovereign level.
See e.g., United States v. Pink, 315 U.S. 203 (1942);
United States v. Belmont, 301 U.S. 324 (1987); Great
Western Insurance Co. v. United States, 112 U.S. 193,
199 (1884). Judicial intervention would directly inter-
fere with the historical authority of the executive and
legislative branches in negotiating, signing and ratifying
treaties. For the Court to rule that Mexico violated in-
ternational and Mexican law by failing to compensate
plaintiffs would seriously damage the lawful and apparent
authority of United States negotiators. See, e.g., Banco
Nacional de Cuba v. Sabbatino, 376 U.S. 398, 423 (1964) ;
United States v. Curtiss-Wright Export Corp., 299 U.S.
304 (1936); Underhill v. Hernandez, 168 U.S. 250
(1897). Entertainment of plaintiffs’ claims could reopen
In Maltina, the former owners of a brewery, expropriated
and dissolved by Cuba, were successful in defeating a claim that
their corporate dissolution was an act of state and that their
corporate authority must be honored in the United States insofar
as it involved trademarks located in the United States. Jd. at 1027.
87a
the Mexican-American claims dispute.** Wherefore, the
Court alternatively holds that the act of state doctrine
bars consideration of plaintiffs’ case.
IV. Conclusion
The Court is deeply troubled by the allegations in plain-
tiffs’ complaint. Mexico agreed in 1941 to assume respon-
sibility for plaintiffs’ loss of land in the Southwestern
United States. Neither the United States nor an appro-
priate legal forum within its borders ever found plain-
tiffs’ claims to be legally cognizable.. Mexico received
substantial consideration, however, in return for its as-
sumption: a release from liability for various claims of
American citizens resulting from the Mexican Revolution.
Those latter claims were paid by the United States as
part of its recognized treaty obligations.
For reasons unknown to the Court, and beyond its
limited grant of jurisdiction under Article III of the Con-
stitution, Mexico has allegedly failed, as the 1941 treaty
provides, to promptly evaluate the claims and provide
compensation. Despite these serious concerns, the Court
holds that it lacks subject matter jurisdiction over this
case pursaunt to the FSIA.
21 A recent example of this possibility is the negative impact on,
United States relations with China as a result of Jackson v.
Peoples Republic of China, 550 F. Supp. 869 (N.D. Ala. 1982).
In Jackson, China chose not to appear and defend against a suit |
for payment on $41.3 million of 1911 Huguang railroad govern-
ment obligations. The Court entered a default judgment and sub-
sequently the Executive Branch has been requested by Chinese
officials to intervene in the decision and deny its effect. Wren,
Separation of Powers? You Must Be Kidding Says China, N.Y.
Times, March 20, 1983, The Week In Review Section. Unlike this
case, had the foreign sovereign entered an appearance, the Court
might have been presented with a record on which to consider the
act of state doctrine,
38a
ORDER
WHEREFORE, it is this 20th day of April, 1982,
hereby
ORDERED that defendant’s motion to dismiss the com-
plaint be and hereby is granted.
/s/ Thomas F. Hogan
THOMAS F. HOGAN
United States District Judge
39a
APPENDIX C
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
September Term, 1983
Civil Action No. 81-02299
No. 83-1596
ASSOCIATION DE RECLAMANTES, et all.,
Appellants
Vv.
THE UNITED MEXICAN STATES
Appeal from the United States District Court
for the District of Columbia
Before: EDWARDS and SCALIA, Circuit Judges, and
SwYGERT, * Senior Circuit Judge for the United
States Court of Appeals for the Seventh Circuit.
JUDGMENT
This cause came on to be heard on the record on appeal
from the United States District Court for the District of
Columbia, and was argued by counsel.
On consideration thereof It is ordered and adjudged by
this Court that the judgment of the District Court ap-
* Sitting by designation pursuant to 28 U.S.C. § 294(d).
———Sae_sxaaaaaw
40a
pealed from in this cause is hereby affirmed, in accord-
ance with the Opinion for the Court filed herein this date.
Per Curiam
For The Court
/s/ George A. Fisher
GEORGE A. FISHER
Clerk
Date: June 5, 1984
Opinion for the Court filed by Cireuit Judge Scalia.
Concurring statement filed by Circuit Judge Edwards.
4la
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
September Term, 1983
Civil Action No. 81-02299
No. 83-1596
ASOCIACION DE RECLAMANTES, et al.,
- Appellants
THE UNITED MEXICAN STATES
[Filed July 23, 1984]
Before: ROBINSON, Chief Judge; WRIGHT, TAMM, WIL-
KEY, WALD, MIKVA, EDWARDS, GINSBURG, BORK,
SCALIA and STARR, Circuit Judges and Swy-
GERT*, Senior Circuit Judge, United States
Court of Appeals for the Seventh Circuit.
ORDER
The Suggestion for Rehearing en banc of Appellants
has been circulated to the full Court and no member has
requested the taking of a vote thereon. On consideration
of the foregoing, it is
ORDERED by the Court en banc that the aforesaid
Suggestion is denied.
Per Curiam
For the Court
GEORGE A. FISHER
Clerk
By /s/ Robert A. Bonner
ROBERT A. BONNER
Chief Deputy Clerk
* Sitting by designation pursuant to title 28 U.S.C. § 294(d).
42a
UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
September Term, 1983
Civil Action No. 81-02299
No. 83-1596
ASOCIACION DE RECLAMANTES, et al.,
Appellants
Vv.
THE UNITED MEXICAN STATES
[Filed Aug. 28, 1984]
Before: EDWARDS and SCALIA, Circuit Judges, and
SwyYGeErT *, Senior Circuit Judge, United States
Court of Appeals for the Seventh Circuit.
ORDER
On consideration of Appellants’ Petition for Rehearing
and Appellants’ Motion for Stay of Mandate, it is
ORDERED by the Court that the Petition for Rehear-
ing is denied and it is
FURTHER ORDERED by the Court that the Motion
for Stay of Mandate is denied.
Per Curiam
For the Court
GEORGE A. FISHER
Clerk
By /s/ Robert A. Bonner
ROBERT A. BONNER
Chief Deputy Clerk
43a
APPEN DIX D
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
Civil Action No. 81-2299
ASOCIACION DE RECLAMANTES,
a Texas nonprofit corporation,
721 East Baker
Edinburg, Texas 78539
(512) 383-4691,
AMINTA ZARATE
721 East Baker
Edinburg, Texas 78539
(512) 383-2035,
Luis RIOJAS
301914 Glenhurst Avenue
Los Angeles, California 90039
(213) 660-5290,
FELIPA FLORES BENAVIDEZ
Route 4, Box 798
Edinburg, Texas 78539
(512) 383-4786,
MARIA AGUIRRE DE SCHULTZ
7226 Westglade Place
San Antonio, Texas 78227
(512) 674-0292,
NIEVES GUERRERO CHAPA
Isac Garza #1515 Pte.
Monterrey, Nuevo Leon
Mexico
745846
44a
SANTOS ZARATE PRIETO
Jesus Bernal #204
Aguascalientes, Aguascalientes
Mexico
65482
Plaintiffs,
v.
THE UNITED MEXICAN STATES,
Defendant.
FIRST AMENDED CLASS ACTION COMPLAINT
FOR TAKING OF PROPERTY
Plaintiffs Asociacion de Reclamantes, Aminta Zarate,
Luis Riojas, Felipa Flores Benavidez, Maria Aguirre de
Schultz, Nieves Guerrero Chapa and Santos Zarate Prieto,
by and through their attorneys, on behalf of themselves
and the class alleged herein, state and allege for their
complaint against the Defendant United Mexican States
(“Mexico”) as follows:
I. PRELIMINARY STATEMENT
1. This is a class action brought against Mexico by
the specifically named Plaintiffs in their own behalf and
on behalf of others similarly situated to recover monetary
damages from Mexico for its use and taking of claims
they or members of their families originally possessed
against the United States of Ameriea (the “United
States”) for the loss of nearly 12 million acres of land
in the State of Texas held under land grants from Spain
or Mexico and to establish a fund out of which class
members may be paid. Mexico has failed to pay these
private claims, which it valued in 1925 at $193,658,954.60,
and which Mexico took and used for its own public pur-
poses, including the securing of recognition by the United
States of a new Mexican government and the reduction
45a
of Mexico’s international financial obligations to the
United States. Since 1941 to the present, Mexico has re-
peatedly acknowledged its obligation to compensate the
Plaintiffs and class members but has failed to satisfy
that obligation.
II. JURISDICTION AND VENUE
2. The jurisdiction of this Court over each of the
claims for relief alleged herein is invoked under 28 U.S.C.
§§ 1830(a) and 1331. The jurisdiction of this Court over
Defendant Mexico is invoked under 28 U.S.C. § 13830(b).
3. Venue is proper in this district under 28 U.S.C.
§ 1391(f) which provides that “a civil action against a
fereign state ... may be brought... (4) in the United
States District Court for the District of Columbia... .”
Ill. PARTIES
4. Plaintiff Asociacion de Reclamantes is a Texas non-
profit corporation established in 1978. Its membership,
totalling nearly 2,000 individuals, is comprised of heirs,
descendants and successors (hereinafter “heirs” includes
“heirs and successors”) of recipients of Spanish and Mex-
ican grants of land in Texas. As hereafter set forth, the
members now possess claims against Mexico for its use,
taking and failure to pay for the land grant related loss
claims they or their ancestors possessed against the
United States. The Asociacion was established to assist
the heirs in securing compensation for these claims from
Mexico.
5. Each of the individual Plaintiffs is an heir of per-
sons on whose behalf Defendant Mexico asserted and set-
tled claims and whom Mexico has failed to compensate.
Each of the individual Plaintiffs is also a member of the
Asociacion de Reclamantes and of the class sought to be
represented herein.
a. Plaintiff Aminta Zarate is a citizen and resident of
the United States and of the State of Texas.
46a
b. Plaintiff Luis Riojas is a citizen and resident of
the United States and of the State of California.
ce. Plaintiff Felipa Flores Benavidez is a citizen and
resident of the United States and of the State of Texas.
d. Plaintiff Maria Aguirre de Schultz is a citizen and
resident of the United States and of the State of Texas.
e. Plaintiff Nieves Guerrere Chapa is a citizen and
resident of Mexico who resides in the Mexican State of
Nuevo Leon.
f. Plaintiff Santos Zarate Prieto is a citizen and resi-
dent of Mexico who resides in the Mexican State of
Aguascalientes.
6. Defendant Mexico is a foreign state wine the
meaning of 28 U.S.C. § 1603.
IV. CLASS ACTION ALLEGATIONS
7. Plaintiffs seek to represent the class of all persons
who are the heirs of the original grantees of, or the heirs
of persons succeeding to title to, 433 specific grants of
land located in what is now the State of Téxas, on whose
behalf Mexico asserted claims for damages for loss of
such lands in negotiations and other proceedings with
the United States culminating in the Treaty of November
19, 1941 between the two countries (hereafter ‘1941
Treaty”). Attached hereto as Exhibit C is a document
prepared by Defendant Mexico in 1932 describing the 433
land grant related claims, and identifying the location of
the land, the original grantees and the value of each
claim. As a result of the acts of Mexico hereinafter de-
scribed, Plaintiffs and the class they seek to represent are
entitled to payrment of compensation and damages by
Mexico for its use, taking, and failure to pay for claims
which the class members and their families possessed
against the United States as a result of violations of
their rights to land in Texas.
Ala
8. This action is properly maintainable as a class ac-
tion on behalf of the class defined above (hereinafter the
“Class”) under Rules 23(a), 23(b) (1) (A) and (B), and
23(b) (3) of the Federal Rules of Civil Procedure.
a. The Class is so numerous that joinder of all mem-
bers is impracticable. Although it cannot now be stated
with certainty how many persons are in the Class, ap-
proximately 2,000 persons, the majority of whom are
members of the Asociacion de Reclamantes, have been
identified by documentary evidence as members of the.
class. Plaintiffs believe that there are substantially more
members of the Class than the group already identified,
including as many as 20,000 persons.
b. There are numerous questions of law and fact com-
mon to the members of the class. They include at least
the following:
1) Whether the court has jurisdiction over the claim;
(2) Whether Mexico is obligated to pay compensation
to plaintiffs and other class members as a result of ifs
extinguishment of claims they or their ancestors had
against the United States stemming arom certain losses of
land in the state of Texas;
(3) Whether, if the plaintiffs are entitled to damages,
the measure thereof is the valuation placed on the claims
by Mexico itself, with appropriate interest and adjust-
ments for inflation, or whether another measure of dam-
ages is appropriate. Other common questions may arise
depending on what defenses Mexico may choose to assert
in this action.
ce. Plaintiffs’ ciaims are typical of the claims of all
members of the Class.
d. Plaintiffs will fairly and adequately represent and
protect the interests of the members of the Class.
(1) Each of the individual plaintiffs, together with
plaintiff Asociation de Reclamantes, has for many years
48a
actively and diligently sought to obtain redress from Mex-
ico for their claims and those of others similarly situated,
through means short of litigation.
(2) Plaintiffs, together with other members of the
Asociacion, have been and are committed to carrying the
expenses, pending litigation, of pursuing the claims of all
class members for the compensation to which they are
entitled;
(3) Plaintiffs have retained as counsel attorneys in
Colorado and California with experience over a five-year
period in attempting to vindicate their rights through
negotiations with the Mexican Government, and who are
highly familiar with the legal basis for the claims, as well
as local counsel with experience in federal court litiga-
tion.
(4) Plaintiffs are also representative of the general
characteristics of the Class members. Plaintiffs Zarate,
Riojas, Flores Benavidez, Aguirre de Schultz are all
United States citizens resident in Texas or California,
where plaintiffs believe a majority of potential class mem-
bers reside. Plaintiffs Guerrero Chapa and Zarate Prieto
are citizens and residents of Mexico, where other Class
members reside.
(5) Plaintiffs’ claims, as set forth in paragraphs 65-
106 of this Complaint, are typical of those of the Class.
Some representative plaintiffs, for example, claim only
through familial descent, while others claim in part
through successorship. All of the representative plaintiffs
have gathered the necessary documentation to establish
the validity of their claim under the rights of their an-
cestors or predecessors for compensation from the defend-
ant.
e. Insofar as there are numerous heirs, some known
and others not, who may be entitled to share in any re-
covery, prosecution of separate actions by individual
Class members would create a risk of 1) inconsistent ad-
49a
judications which would establish incompatible standards
of conduct for Defendant Mexico and 2) adjudications
with respect to individual Class members which would as
a practical matter be dispositive of the interests of the
other members or substantially impair or impede their
ability to protect their interests.
f. The common questions of law and fact predominate
over any questions affecting only individual Class mem-
bers, including the question of individual damages, and a
class action is superior to other methods for a fair and
efficient adjudication of the controversy because, inter
alia, the number of the members of the Class is substan-
tial and the members’ interests are highly similar.
ee ee a
(1) Given the number of different possible claimants
with regard to each of the original land grants, the inter-
ests of class members in individually controlling the pros-
ecution of actions separately is small;
(2) There are no other pending cases concerning the
controversy of which any of the plaintiffs or their counsel
are aware;
(3) It is highly desirable to litigate all such claims
against Mexico in one forum, since all parties have an
interest in a final resolution of the liability issue; and
(4) No difficulties of managing this action as a class
action are posed that cannot be resolved at an appropriate
time through the establishment of sub-classes pursuant to
Rule 23(c) (4).
V. GENERAL ALLEGATIONS
Acquisition And Loss Of Land In Texas.
9. During the period prior to February 2, 1848, Spain
and Mexico, which exercised sovereignty over the region
now known as the State of Texas (hereafter “Texas’),
made thousands of grants of land in Texas, including the
433 grants to Plaintiffs’ ancestors. Collectively these 433
ee
50a
land grants encompassed 12 million acres of land, most of
it laying between the Rio Grande and the Nueces River in
South Texas.
10. Under the Treaty of Guadalupe Hidalgo, entered
into by Mexico and the United States on February 2,
1948, Mexico relinquished to the United States its claim
to sovereignty over Texas and other vast areas now part
of the United States. Since 1848 sovereignty over Texas
has been exercised by the State of Texas and the United
States.
11. Under the Treaty of Guadalupe Hidalgo, princi-
ples of international law and the law of the United States,
the rights possessed under Spanish and Mexican grants
of land in Texas by the recipients of such grants and
their heirs were entitled to be respected and protected by
the United States and its citizens.
12. After the United States and State of Texas as-
sumed sovereignty over Texas, the rights of the original
Spanish and Mexican grantees and their heirs to land in
Texas were not respected but were wrongfully taken and
violated by the United States, the State of Texas and
their citizens, resulting in the loss by the original land
grantees and their heirs of 12 million acres of land in
Texas.
13. Under the Treaty of Guadalupe Hidalgo and prin-
ciples of international iaw, Mexico sought redress from
the United States for the heirs of the original Spanish
and Mexican grantees for the violations of their land
grant based rights.
Mevico’s Soicitation, Assertion And Filing Of Heirs’
Claims Against The United States For Land Losses.
14. In the early 1920s General Alvaro Obregon, victor
in the Mexican Revolution and President of Mexico,
sought recognition from the United States of his govern-
ment as the de jure government of Mexico.
5la
15. The United States initially sought to condition any
such recognition on Mexico’s satisfaction of several hun-
dred million dollars of claims by American nationals
against Mexico. These claims stemmed from alleged acts
or omissions of the Mexican Government during the Mex-
ican Revolution as well as prior to and after it.
16. President Obregon responded by raising the issue
of the United States’ liability to the heirs of the original
Spanish and Mexican grantees for violations of their fam-
ilies’ land grant rights in Texas. Mexico asserted that
these violations had given rise to a substantial monetary
liability.
17. By these negotiations, President Obregon achieved
a substantial Mexican public purpose: the securing of
the United States’ official recognition of his government
as the de jure government of Mexico without first satis-
fving the claims of American nationals.
18. On September 8, 1923, Mexico, and the United
States entered into a treaty (the “1923 Treaty”) to pro-
vide in part “for the amicable settlement and adjustment
of claims” which had been raise1 in the recognition dis-
cussions. Attached hereto as Exhibit A is a copy of the
1923 Treaty. Pursuant to the 1923 Treaty, the United
States and Mexico agreed to the establishment of a Gen-
eral Claims Commission whith would have the authority
to hear and decide a variety of claims, including those of
the heirs of original Spanish and Mexican land grantees
against the United States which Mexico had previously
raised in the recognition discussions.
19. Mexico filed 836 claims against the United States
with the General Claims Commission which it valued at
$245,158,395.32 plus interest. Of these claims, 433 were
on behalf of the heirs, including many American citizens,
of original Spanish and Mexican grantees of land in
Texas. Mexico valued these 433 claims in 1925 at
$193,658,954.60 plus interest, a figure determined by ref-
52a
erence to the value of the lands taken. Attached hereto
as Exhibit B is a copy of one of the 433 complaints Mex-
ico filed against the United States on behalf of the heirs.
Also attached hereto, as Exhibit C, is a copy of a docu-
ment published by Mexico in 1932 which lists and de-
scribes with particularity each of the 433 land grant re-
lated claims it filed against the United States and speci-
fies the grantee and the dollar value of each claim.
20. The United States filed 2,781 claims against Mex-
ico with the General Claims Commission with a total as-
serted value of $513,694,267.17.
21. In order to obtain, develop and present the 433
land grant related claims it filed with the General Claims
Commission, Mexico engaged in numerous activities be-
tween approximately 1920 and 1941 in the State of Texas
and the United States.
22. On information and belief, Plaintiffs allege that
the activities of Mexico in this period in the United
States and State of Texas included:
a. placing notices in public places, newspapers, maga-
zines and periodicals and on the radio advising the heirs
that it would file claims on their behalf against the
United States based on their families’ land losses;
b. meeting with the heirs at the Mexican Consulate in
San Antonio, Texas, and at various other locations to dis-
cuss their claims;
ce. securing evidence from the heirs and from other
sources necessary to prove the land granted related
claims;
d. retaining the services of attorneys, investigators and
others to, among other things, meet with the heirs to de-
velop their claims;
e. negotiating on behalf of the heirs with the United
States at Washington, D.C. and other locations;
53a
f. filing claims on behalf of the heirs with the General
Claims Commission in Washington, D.C.; and
g. entering into treaties and protocols with the United
States regarding the heirs’ claims.
23. When the General Claims Commission ceased hear-
ing and deciding claims in 1931, it had heard and de-
cided none of the 433 land grant related claims Mexico
had filed and only 109 of the other several thousand
claims before it.
24. Pursuant to the protocol of April 24, 1934, be-
tween Mexico and the United States, the claims not de-
cided by the General Claims Commission were to be
evaluated by two appraisers acting under a specified ap-
praisal procedure.
25. When the authority of the appraisers to act on
the claims expired on or about June 30, 1936, none of
the 433 land grant related claims filed by Mexico, and
only a few of the remaining claims, had been evaluated
pursuant to this procedure.
Mexico’s Confiscation and Use Of The Heirs’ Land
Loss Claims.
26. In early 1940 Mexico and the United States com-
menced negotiations aimed at resolving a host of pend-
ing disputes between them. Among such disputes were
the 433 land grant related claims Mexico had filed with
the General Claims Commission as well as new claims by
American oil companies seeking compensation for oil pro-
ducing properties expropriated by Mexico in March,
1938.
27. In these negotiations, the United States and Mex-
ico agreed to settle and resolve the claims that each had
against the other, including the 433 land grant claims
at issue herein, by setting off and releasing each set of
asserted claims. This agreement was embodied in the
54a
1941 Treaty, by which Mexico became obligated to pay
$40,000,000 to the United States, the amount by which
all of the United States claims against Mexico were de-
termined to exceed all of the Mexican claims against the
United States. By the 1941 Treaty, Mexico received sub-
stantial value, in excess of $193 million, in satisfaction
of the claims involved in the instant action which Mexico
had asserted against the United States. The Treaty of
1941 is attached hereto as Exhibit D.
28. Mexico paid the $40,000,000.00 to the United
States in a timely manner and by approximately 1948
the United States had paid the claims of American na-
tionals against Mexico, which the United States had as-
serted in the Treaty negotiation, pursuant to the pro-
visions of the Settlement of Mexican Claims Act of 1942,
public law 814, 77th Cong., 2d Sess., 56 Stat. 1058.
29. Mexico’s release of the United States from liabil-
ity on the 433 land grant related claims, in exchange for
valuable consideration, constituted a use and taking by
Mexico of those claims for its own public purposes, in-
cluding the reduction of Mexico’s financial liabilities to
the United States. As a result, Mexico became obligated
to pay just, effective and prompt compensation for the
433 land grant related claims.
Mexico’s Acknowledgment Of Its Obligation To Com-
pensate Heirs For Their Claims.
30. On December 9, 1941, the then President of Mex-
ico, Manuel Avila Camacho, issued a decree which ac-
knowledged Mexico’s obligation to pay compensation for
the expropriated land grant related claims. The Decree
stated:
“(I]t is the duty of the Government to satisfy
[the claims] in accordance with the role they played
in the [1941 Treaty]. ... [T]he claims... have
become internal obligations of our government...
one of our many domestic pecuniary responsibilities.”
55a
A copy of this decree, with an English translation, is
attached hereto as Exhibit E.
31. From 1941 to the present Mexico has repeatedly
acknowledged its obligation and intention to pay com-
pensation for the confiscated land grant related claims.
Such acknowledgements have been made in numerous
letters to heirs of the original grantees under whom the
land grant related claims were made. A copy of such a
letter sent to Plaintiff Aguirre de Schultz’s ancestors,
with an English translation, is attached hereto as Ex-
hibit F. Similar letters were sent to members of the class
as recently as the late 1970’s.
32. These letters, including Exhibit F, specifically
stated:
The Federal Government intends to resolve this
grave problem, as soon as the economic conditions
of the treasury permit it to.
33. On information and belief, Plaintiffs alleged that
annually from the celebration of the 1941 Treaty to the
present Mexico, in official reports prepared and dissemi-
nated by its Treasury Department, has listed among its
monetary debts its obligation to pay compensation for
the confiscated land grant related claims.
34. Heirs of the original Spanish and Mexican gran-
tees under whom the land grant related claims arose have
made numerous efforts since November 19, 1941, to se-
cure compensation from Mexico for confiscated claims.
Efforts By Heirs To Secure Compensation From
Mexico; Meetings With And Representations Of Mex-
ican Officials.
35. In the late 1970s heirs of the original Spanish and
Mexican grantees of land in Texas joined together in an
effort to secure compensation from Mexico for their con-
fiscated claims.
56a
36. Since 1976 representatives of the heirs have met
various times with representatives of Mexico to discuss
its liability to the heirs as a result of its use, taking and
confiscation of their land grant related claims.
37. In October, 1976, during the term of Mexican
President Luis Echeverria Alvarez, the heirs’ representa-
tives met with Lic. Jose Gallastigue, an Under-Secretary
in the Mexican Foreign Ministry, to discuss payment of
the heirs’ claims.
38. Lic. Gallastigue stated that the claims of the heirs
would be paid if they proved their descent from one of
the 433 original Spanish and Mexican land grantees un-
der whom Mexico filed clams with the General Claims
Commission.
39. The heirs’ representatives reasonably relied upon
Lic. Gallastigue’s representations and thereupon per-
formed substantial work and incurred expenses to sub-
mit documents to Lic. Gallastigue proving the claims of
three such heirs.
40. Lic. Gallastigue’s tenure as an Under-Secretary
ended on or about November 30, 1976, with the inaugura-
tion of Lic. Jose Lopez Portillo as Mexico’s new Presi-
dent. The heirs’ representatives never received a response
from Lic. Gallastigue on the claims they submitted to
him.
41. In September, 1977, the heirs’ representatives met
with Ambassador Eduardo Gutierrez Evia, head of the
Legal Advisor’s Office of the Mexican Foreign Ministry,
and members of his staff to discuss payment of compen-
sation on the heirs’ claims.
42. In this meeting, the heirs’ representatives were
told that a review would be made of Mexico’s obligation
to pay compensation on the claims and that Mexico would
pay such claims if the Legal Advisor’s Office determined
that there was a present obligation to do so.
57a
43. The heirs and their representatives reasonably re-
lied on the representations made by Mexico through Am-
bassador Gutierrez Evia and engaged in further meet-
ings with the Ambassador and his staff during the re-
view by Mexico of its obligation to the heirs.
44, In reasonable reliance on Mexico’s representations
the heirs’ represeitatives met with Ambassador Gutierrez
Evia and his staff on a variety of occasions between Sep-
tember, 1977, and March, 1978, in Mexico City and New
York City to discuss Mexico’s obligation to the heirs,
and did not pursue other avenues of recourse to require
Mexico to satisfy its obligation.
45. On information and belief, Plaintiffs allege that
in or about March, 1978, Ambassador Gutierrez Evia
and his staff concluded that Mexico had a present obliga-
tion to pay the heirs’ land grant related claims. There-
after, however, Ambassador Gutierrez Evia did not meet
further with the heirs’ representatives to discuss pay-
ment of the claims.
46. In January of 1980, representatives of the heirs
met twice in Mexico with Ambassador Sergio Gonzales
Gaivez, who had succeeded Ambassador Gutierrez Evia
as head of the Legal Advisor’s Office, to discuss payment
by Mexico on the heirs’ land grant related claims.
47. In these meetings, Ambassador Gonzalez Galvez
stated that the decision had been made “by the highest
authorities’ in the Mexican Government that Mexico
would promptly pay the compensation owed on the heirs’
land grant related claims.
48. Ambassador Gonzalez Galvez further stated that
in order to establish the mechanism by which the claims
would be paid, Mexico’s Treasury Department would im-
mediately proceed to draft legislation for submission to
and enactment by the Mexican Congress when it con-
vened in September, 1980.
58a
49. Ambassador Gonzalez Galvez then informed the
heirs’ attorneys and representatives that a meeting had
been arranged for them with the Mexican Treasury De-
partment on January 9, 1980, with the approval of the
“highest authorities” in the Mexican Government.
50. Thereafter, the heirs’ attorneys, accompanied by
three representatives of the Mexican Foreign Ministry,
met with representatives of the Treasury Department on
the designated date.
51. In that meeting the heirs’ representatives were
told by the Treasury Department’s representatives that
the legislation to establish the mechanisms to pay the
land grant related claims would be drafted in the near
future and ready for submission in September 1980, to
the Mexican Congress.
52. After their January, 1980, meetings with rep-
resentatives of the Mexican Government, the heirs’ at-
torneys received a letter dated January 23, 1980, from
the Mexican Treasury Department, signed by C. P.
Roberto Dieguez Arams, chief of the Office of Public
Debt, and a telegram from Ambassador Gonzalez Galvez
dated March 5, 1980. A copy of the letter, with an Eng-
lish translation, is attached as Exhibit G, and a copy of
the telegram, with an English translation, is attached as
Exhibit H. These communications acknowledged and re-
iterated Mexico’s intention to proceed expeditiously to
compensate the heirs.
53. The heirs and their representatives reasonably re-
lied on Mexico’s oral and written representations, from
1941 through 1980, that it would pay the heirs claims.
54. In reasonable reliance upon the representations
made by Mexico as set forth above, the heirs and their
representatives, including Plaintiffs, engaged in substan-
tial work, requiring several thousand hours of research,
analysis and preparation to present their position to the
Mexican Legal Advisor’s Office, and incurred expenses in
excess of $100,000.
59a
55. The legislation which the Mexican Government’s
representatives indicated in the January, 1980, meetings
would be drafted and submitted to the Mexican Con-
gress was never drafted nor submitted to the Congress.
56. In or about May, 1980, the heirs’ representatives
were advised by the Mexican Foreign Ministry that it
was uncertain when steps would be taken to bring about
the payment of the claims. Notwithstanding the con-
tinued efforts of the heirs to resolve this matter short
of litigation, to date no steps have been taken by Mexico
to bring about such payment.
Mexico’s Jurisdictionally Relevant Contacts With
The United States.
57. Paragraphs 1 through 56 set forth above are in-
corporated herein by reference.
58. In addition to 28 U.S.C. § 1330(b), and contacts
with the United States relating to the land grant claims
at issue herein, each of which would be sufficient in
themselves to sustain the exercise of personal jurisdic-
tion over Mexico in this action, Plaintiffs allege on in-
formation and belief that Mexico has other substantial
and numerous contacts with the United States. Those
contacts, which are also sufficient in themselves to sus-
tain the exercise of personal jurisdiction over Mexico in
this action, include:
a. ownership and operation of a commercial air car-
rier which serves many cities in the United States;
b. operation in many cities of offices promoting tour-
ism to Mexico;
e. sale and delivery of petroleum products, natural
gas, vegetables and other products to entities in the
United States; and
d. marketing of its or its agencies’ securities in the
United States.
60a
VI. CLASS CLAIM
59. Paragraphs 1 through 58 set forth above are in-
corporated herein by reference.
60. As set forth above, in or about 1925 Mexico filed
433 land grant related loss claims against the United
States with the General Claims Commission on behalf of
the class members and their families as heirs of recipients
of grants of land in Texas.
61. The 433 claims Mexico filed were individually
valued by Mexico in 1925 as indicated in the claims
booklet attached hereto as Exhibit C at $193,658,954.60.
62. By virtue of Mexico’s use, taking and confiscation
of the claims referred to above without payment of just
compensation, Mexico has violated the rights in property
in the United States possessed by members of the Class
and their families. Plaintiffs are therefore entitled to
compensation from Mexico for such use, taking and con-
fiscation of their property or that of their ‘amily mem-
bers in an amount not less than $193,658,954.60, plus
interest since at least 1941.
63. For its own public purposes Mexico asserted
against the United States the claims of the Plaintiff Class
and their families for the taking of their property, re-
leased the United States from liability for those claims
under the 1941 Treaty in exchange for valuable consider-
ation, and thereby assumed and became liable to com-
pensate the Class for these claims, but has failed to do
so. By these acts, the Defendant has breached its fi-
duciary duty and other legal obligations, express and
implied, to the Plaintiff Class to compensate them for
the taking of their property and has become liable to
pay the Class members an amount not less than the
value of the claims Defendant asserted against the United
States, 2.e., $193,658,954.60 plus interest since at least
1941.
6la
64. Mexico solicited or otherwise acquired the claims
of the Plaintiff Class members for the taking of their
property, and having received valuable consideration
therefor, has tortiously failed and omitted to return the
value of said claims to members of the Class. Mexico
is thus liable to pay the Class members damages for the
loss of their property arising from this tortious conduct
in an amount not less than the value of the claims, 7.e.,
$193,658,954.60 plus interest since at least 1941.
VII. CLAIM OF AMINTA ZARATE
65. Plaintiff Aminta Zarate incurporates herein by
reference paragraphs 1 through 64 set forth above.
66. Plaintiff Zarate is a direct descendent and heir
of Jose Narciso Cavazos and Francisco Guerra, each of
whom received one or more grants of land in Texas from
Spain or Mexico, and Manuela Montemayor Cardenas
who was, pursuant to a public sale in or about 1802,
the successor in interest of the rights of Juan Jose Balli
to land in Texas granted him by Spain.
67. In or about 1925 Mexico filed land grant related
loss claims against the United States with the General
Claims Commission on behalf of the heirs of Jose Narciso
Cavazos, Francisco Guerra and Juan Jose Balli. The
claim on behalf of the heirs of Jose Narciso Cavazos,
valued by Mexico in 1925 at $12,100,000.00 plus inter-
est, was assigned docket number 1081 by the General
Claims Commission. The claim on behalf of the heirs of
Francisco Guerra, valued by Mexico in 1925 at $44,280.00
plus interest, was assigned docket number 1153 by the
General Claims Commission. The claim on behalf of the
heirs of Juan Jose Balli, valued by Mexico in 1925 at
$13,784,000.00 plus interest, was assigned docket num-
ber 1105 by the General Claims Commission.
68. Plaintiff Zarate has succeeded by inheritance to
the rights of her ancestors in these claims.
69. By virtue of Mexico’s use, taking and confiscation
of the claims referred to in paragraph 67 above without
62a
payment of just compensation, Mexico has violated the
rights in property in the United States possessed by
Plaintiff Zarate and by her family. Plaintiff is therefor
entitled to compensation from Mexico for such use, tak-
ing and confiscation of her property or that of her family
members in an amount not less than her rightful share
of $25,928,280.00 plus interest since at least 1941.
70. For its own public purposes Mexico asserted
against the United States thw laims of Plaintiff Zarate
and her family for the taking of their property, released
the United States from liability for those claims under
the 1941 Treaty in exchange for valuable consideration,
and thereby assumed and became liable to compensate
Plaintiff Zarate for these claims, but has failed to do so.
By these acts, the Defendant has breached its fiduciary
duty and other legal obligations, express and implied,
to Plaintiff Zarate to compensate her for the taking of
her property and has become liable to pay to Plaintiff
Zarate an amount not jess than her rightful share of the
value of the claims which Defendant asserted against the
United States, i.e., $25,928,280.00 plus interest since at
least 1941.
71. Mexico solicited or otherwise acquired the claims
of Plaintiff Zarate and her family for compensation for
the taking of their property, and having received valuable
consideration therefor has tortiously failed and omitted
to return the value of said claims to Plaintiff Zarate.
Mexico is thus liable to pay Plaintiff Zarate damages for
the loss of the property arising from this tortious con-
duct in an amount not less than her rightful share of the
value of the claims, 7.e., $25,928,280.00 plus interest since
at least 1941.
VIII. CLAIM OF LUIS RIOJAS
72. Plaintiff Luis Riojas incorporates herein by ref-
erence paragraphs 1 through 64 set forth above.
6Sa
73. Plaintiff Riojas is a descendant and heir of Ig-
nacio Galindo, who received two grants of land in Texas
from Spain.
74. In or about 1925 Mexico filed two land grant re-
lated loss claims against the United States with the Gen-
eral Claims Commission on behalf of the heirs of Ignacio
Galindo. The claims on behalf of the heirs of Ignacio Ga-
lindo were assigned docket numbers 2860 and 3061 by
the General Claims Commission. The claim assigned
docket number 2860 was valued by Mexico in 1925 at
$487,080.00 plus interest while the claim assigned docket
number 3061 was valued at that date at $974,160.00 plus
interest.
75. Plaintiff Riojas has succeeded by inheritance to
the rights of his ancestors in these claims.
76. By virtue of Mexico’s use, taking and confiscation
of the claims referred to in paragraph 74 above without
payment of just compensation, Mexico has violated the
rights in property in the United States possessed by Plain-
tiff Riojas and his family. Plaintiff is therefor entitled
to compensation from Mexico for such use, taking and
confiscation of his property or that of his family mem-
bers in an amount not less than his rightful share of
$1,461,240.00 plus interest since at least 1941.
77. For its own public purposes Mexico asserted
against the United States the claims of Plaintiff Riojas
and his family for the taking of their property, released
the United States from liability for those claims under
the 1941 Treaty in exchange for valuable consideration,
and thereby assumed and became liable to compensate
Plaintiff Riojas for these claims, but has failed to do so.
By these acts, the Defendant has breached its fiduciary
duty and other legal obligations, express and implied, to
Plaintiff Riojas to compensate him for the taking of the
property and has become liable to pay to Plaintiff Riojas
an amount not less than his rightful share of the value of
64a
their claims which Defendant asserted against the United
States, .e., $1,461,240.00 plus interest since at least 1941.
78. Mexico solicited or otherwise acquired the claims
of Plaintiff Riojas and his family for compensation for
the taking of their property, and having received valu-
able consideration therefor has tortiously failed and
omitted to return the value of said claims to Plaintiff
Riojas. Mexico is thus liable to pay Plaintiff Riojas dam-
ages for the loss of the property arising from this tortious
conduct in an amount not less than his rightful share of
the value of the claims, i.¢., $1,461,240.00 plus interest
since at least 1941.
IX. CLAIM OF FELIPA FLORES BENAVIDEZ
79. Plaintiff Felipa Flores Benavidez incorporates by
reference paragraphs 1 through 64 set forth above.
80. Plaintiff Felipa Flores Benavidez is a direct de-
scendant and heir of Juan Flores, who received two grants
of land in Texas from Spain.
81. In or about 1925 Mexico filed two land grant re-
lated loss claims against the United States with the Gen-
eral Claims Commission on behalf of the heirs of Juan
Flores. The claims on behalf of the heirs of Juan Flores
were assigned docket numbers 1084 and 2833 by the Gen-
eral Claims Commission. The claim assigned docket num-
ber 1084 was valued by Mexico in 1925 at $354,260.00
plus interest while the claim assigned docket number
2833 was valued at that date at $354,240.00 plus in-
terest.
82. Plaintiff Flores Benavidez has succeeded by in-
heritance to the rights of her ancestors in these claims.
83. By virtue of Mexico’s use, taking and confiscation
of the claims referred to in paragraph 81 above without
payment of just compensation, Mexico has violated the
rights in property in the United States possessed by Plain-
tiff Flores Benavidez and by her family. Plaintiff is
65a
therefor entitled to compensation from Mexico for such
use, taking and confiscation of her property or that of
her family members in an amount not less than her
rightful share of $708,500.00 plus interest since at ‘east
1941.
84. For its own public purposes Mexico asserted
against the United States the claims of Plaintiff Flores
Benavidez and her family for the taking of their property,
released the United States from liability for those claims
under the 1941 Treaty in exchange for valuable consid-
eration, and thereby assumed and became liable to com-
pensate Plaintiff Flores Benavidez for these claims, but
has failed to do so. By these acts, the Defendant has
breached its fiduciary duty and other legal obligations,
express and implied, to Plaintiff Flores Benavidez to
compensate her for the taking of the property and has
become liable to pay to Plaintiff Flores Benavidez an
amount not less than her rightful share of the value of
the claims which Defendant asserted against the United
States, i.e., $708,500.00 plus interest since at least 1941.
85. Mexico solicited or otherwise acquired the claims
of Plaintif” Flores Benavidez and her family for compen-
sation for the taking of their property, and having re-
ceived valuable consideration therefor has tortiously failed
and omitted to return the value of said claims to Plain-
tiff Flores Benavidez. Mexico is thus liable to pay Plain-
tiff Flores Benavidez damages for the loss of the prop-
erty arising from this tortious conduct in an amount not
less than her rightful share of the value of the claims,
i.e., $708,500.00 plus interest since at least 1941.
X. CLAIM OF MARIA AGUIRRE DE SCHULTZ
86. Plaintiff Maria Aguirre de Schultz incorporates
by reference paragraphs 1 through 64 set forth above.
87. Plaintiff Aguirre de Schultz is a descendant and
heir of Manuel de los Santos Coy, who received a grant
of land in Texas from Spain.
66a
88. In or about 1925 Mexico filed a land grant re-
lated loss claim against the United States with the Gen-
eral Claims Commission on behalf of the heirs of Manuel
de los Santos Coy. The claim on behalf of the heirs of
Manuel de los Santos Coy was assigned docket number
2776 by the General Claims Commission and was valued
by Mexico in 1925 at $332,100.00 plus interest.
89. Plaintiff Aguirre de Schultz has succeeded by in-
heritance to the rights of her ancestors in this claim.
90. By virtue of Mexico’s use, taking and confiscation
of the claim referred to in paragraph 88 above without
payment of just conpensation, Mexico has violated the
rights in property in the United States possessed by
Plaintiff Aguirre de Schultz and by her family. Plaintiff
is therefor entitled to compensation from Mexico for such
use, taking and confiscation of her property or that of
her family members in an amount not less than her right-
ful share of $332,100.00 plus interest since at least 1941.
91. For its own public purposes Mexico asserted
against the United States the claim of Plaintiff Aguirre
de Schultz and her family for the taking of their prop-
erty, released the United States from liability for those
claims under the 1941 Treaty in exchange for valuable
consideration, and thereby assumed and became liable
to compensate Plaintiff Aguirre de Schultz for this claim,
but has failed to do so. By these acts, the Defendant has
breached its fiduciary duty and other legal obligations,
express and implied, to Plaintiff Aguirre de Schultz to
compensate her for the taking of the property and has
become liable to pay to Plaintiff Aguirre de Schultz an
amount not less than her rightful share of the value of
the claim which Defendant asserted against the United
States, i.e., $332,100.00 plus interest since at least 1941.
92. Mexico solicited or otherwise acquired the claim
of Plaintiff Aguirre de Schultz and her family for com-
pensation for the taking of their property, and having
67a
received valuable consideration therefor has tortiously
failed and omitted to return the value of said claim to
Plaintiff Aguirre de Schultz. Mexico is thus liable to pay
Plaintiff Aguirre de Schultz damages for the loss of the
property arising from this tortious conduct in an amount
not less than her rightful share of the value of the claim,
i.€., $332,100.00 plus interest since at least 1941.
XI. CLAIM OF NIEVES GUERRERO CHAPA
93. Plaintiff Nieves Guerrero Chapa _ incorporates
herein by reference paragraphs 1 through 64 set forth
above.
94, Plaintiff Guerrero Chapa is a descendant and heir
of Luciano Chapa, who received two grants of land in
Texas from Mexico.
95. In or about 1925 Mexico filed two land grant re-
lated loss claims against the United States with the Gen-
eral Claims Commission on behalf of the heirs of Luciano
Chapa. The claims on behalf of the heirs of Luciano
Chapa were assigned docket numbers 2831 and 3046 by
the General Claims Commission. The claim assigned
docket number 2831 was valued by Mexico in 1925 at
$354,240.00 plus interest while the claim assigned docket
number 3046 was valued at that date at $797,040.00 plus
interest.
96. Plaintiff Guerrero Chapa has succeeded by in-
heritance to the rights of his ancestors in these claims.
97. By virtue of Mexico’s use, taking and confiscation
of the claims referred to in paragraph 95 above without
payment of just compensation, Mexico has violated the
rights in property in the United States possessed by Plain-
tiff Guerrero Chapa and by his family. Plaintiff is there-
for entitled to compensation from Mexico for such use,
taking and confiscation of his property or that of his
family members in an amount not less than his right-
68a
ful share of $1,151,280.00 plus interest since at least
1941.
98. For its own public purposes Mexico asserted
against the United States the claims of Plaintiff Guerrero
Chapa and his family for the taking of the property, re-
leased the United States from liability for those claims
under the 1941 Treaty in exchange for valuable consid-
eration, and thereby assumed and became liable to com-
pensate Plaintiff Guerrero Chapa for these claims, but
has failed to do so. By these acts, the Defendant has
breached its fiduciary duty and other legal obligations,
express and implied, to Plaintiff Guerrero Chapa to com-
pensate him for the taking of the property and has be-
come liable to pay to Plaintiff Guerrero Chapa an amount
not less than his rightful share of the value of the claims
which Defendant asserted against the United States, i.e.,
$1,151,280.00 plus interest since at least 1941.
99. Mexico solicited or otherwise acquired the claims
of Plaintiff Guerrero Chapa and his family for compen-
sation for the taking of their property, and having re-
ceived valuable consideration therefor has _tortiously
failed and omitted to return the value of said claims to
Plaintiff Guerrero Chapa. Mexico is thus liable to pay
Plaintiff Guerrero Chapa damages for the loss of their
property arising from this tortious conduct in an amount
not less than his rightful share of the value of the claims,
i.€., $1,151,280.00 plus interest since at least 1941.
XII. CLAIM OF SANTOS ZARATE PRIETO
100. Plaintiff Santos Zarate Prieto incorporates here-
in by reference paragraphs 1 through 64 set forth
above.
101. Plaintiff Zarate Prieto is a direct descendant and
heir of Jose Elizondo and Ignacio Villarreal, each of
whom received a grant of land in Texas from Mexico.
102. In or about 1925 Mexico filed land grant related
loss claims against the United States with the General
9a
Claims Commission on behalf of the heirs of Jose Elizondo
and Ignacio Villarreal. The claim of behalf of the heirs
of Jose Elizondo, valued by Mexico in 1925 at $487,080.00
plus interest, was assigned docket number 2855 of the
General Claims Commission. The claim on behalf of the
heirs of Ignacio Villarreal, valued by Mexico in 1925 at
$442,800.00 plus interest, was assigned docket number
3011 by the General Claims Commission.
103. Plaintiff Zarate Prieto has succeeded by inheri-
tance to the rights of her ancestors in these claims.
104. By virtue of Mexico’s use, taking and confisca-
tion of the claims referred to in paragraph 102 above
without payment of just compensation, Mexico has vio-
lated the rights in property in the United States possessed
by Plaintiff Zarate Prieto and by her family. Plaintiff
is therefor entitled to compensation from Mexico for such
use, taking and confiscation of her property or that of
her family members in an amount no less than her right-
ful share of $929,880.00 plus interest since at least 1941.
105. For its own public purposes Mexico asserted
against the United States the claims of Plaintiff Zarate
Prieto and her family for the taking of their property,
released the United States from liability for those claims
under the 1941 Treaty in exchange for valuable consid-
eration, and thereby assumed and became liable to com-
pensate Plaintiff Zarate Prieto for these claims, but has
failed to do so. By these acts, the Defendant has breached
its fiduciary duty and other legal obligations, express
and implied, to Plaintiff Zarate Prieto to compensate
her for the taking of the property and has become
liable to pay to Plaintiff Zarate Prieto an amount not
less than her rightful share of the value of the claims
which Defendant asserted against the United States, 7.e.,
$929,880.00 plus interest since at least 1941.
106. Mexico solicited or otherwise acquired the claims
of Plaintiff Zarate Prieto and her family for compensa-
tion for the taking of their property, and having re-
70a
ceived valuable consideration therefor has tortiously
failed and omitted to return the value of said claims to
Plaintiff Zarate Prieto. Mexico is thus liable to pay
Plaintiff Zarate Prieto damages for the loss of the prop-
erty arising from this tortious conduct in an amount not
less than her rightful share of the value of the claims,
1.€., $929,880.00 plus interest since at least 1941.
XIII. CLAIM OF ASOCIACION DE RECLAMANTES
107. Plaintiff Asociacion de Reclamantes incorporates
herein by reference Paragraphs 1 through 106 set forth
above.
108. In January, 1978, the individual Plaintiffs, and
other Class members and descendants of the original
grantees of the 433 land grants described above, estab-
lished the Asociacion de Reclamantes to assist them in
securing compensation from Mexico. The Asociacion’s
membership of some 2,000 persons includes heirs of ap-
proximately 290 of the 433 original Spanish and Mexi-
can land grantees for whom Mexico filed claims with the
General Claims Commission.
109. Plaintiff Asociacion de Reclamantes has incurred
expenses in seeking to obtain compensation owed its
members from Mexico. These expenses were incurred in
reliance on Mexico’s representations to the land grant
heirs and their representatives set forth above. Plain-
tiff Asociacion de Reclamantes seeks to recover these ex-
penses from Defendant Mexico as damages caused by
Mexico’s wrongful failure to compensate the heirs.
110. On behalf of its members, who have been injured
by Defendant Mexico’s wrongful failure to compensate
them monies owed, the Asociacion de Reclamantes seeks
a declaratory judgment that
a) Mexico has used, taken and confiscated the
claims of the heirs of the 433 land grantees listed in
Exhibit C to this Complaint without payment of just
compensation, and
T1la
b) Mexico has breached its fiduciary duty and other
legal obligations to the said heirs by having asserted
and released their claims against the United States
without having compensated said heirs for the loss
of their property; and
c) Mexico has tortiously failed and omitted to re-
turn the value of said claims to said heirs; and
d) Mexico is accordingly liable to compensate said
heirs in an amount not less than the value which
Mexico placed on such claims in 1925, $193,658,954.60
plus interest.
WHEREFORE, Plaintiffs Asociacion de Reclamantes,
Aminta Zarate, Luis Riojas, Felipa Flores Benavidez,
Maria Aguirre de Schultz, Nieves Guerrero Chapa, and
Santos Zarate Prieto pray that the Court order the fol-
lowing relief:
A. Payment by Mexico of all monies owed the indi-
vidual Plaintiffs and other Class members for the value
of the land grant related claims asserted on their behalf,
including interest thereon;
B. Payment by Mexico of all other damages incurred
by Plaintiffs as a result of the wrongful failure of Mex-
ico to pay these claims;
C. Payment by Mexico of costs and expenses incurred
by Plaintiffs and the Class in this action, including at-
torneys’ fees;
D. Placing of all funds received or paid in satisfaction
of Mexico’s liability to Class members into a fund, the
distribution of which shall be supervised by the Court
under an appropriate procedure to be determined;
E. On behalf of Plaintiff Asociacion de Reclamantes,
a Declaratory Judgment as set forth in Paragraph 110
above; and
F. Such other and further relief as the Court deems
just and proper.
724
BARON, FAULKNER &
SALAZAR, P. C.
/s/ Robert J. Salazar
ROBERT J. SALAZAR
550 Writer Square
1512 Larimer Street
Denver, Colerado 80202
(303) 572-3066
RUSSELL E. VIGIL, Esq.
/s/ Russel E. Vigil
3271 South Clay Street
Englewood, Colorado 80110
(303) 781-7359
JESS J. ARAUJO, Esq.
/s/ Jess J. Araujo
Suite 206
1200 North Main Street
Santa Ana, California 92701
(714) 835-6990
RoGcovin, HUGE & LENZNER
/3/ Mitchell Rogovin
MITCHELL ROGOVIN
GEORGE T. FRAMPTON, JR.
VICKI C. JACKSON
1730 Rhode Island Ave., N.W.
Washington, D.C. 20036
(202) 466-6464
Attorneys for Plaintiffs
Asociacion de Reclamantes,
Aminta Zarate, Luis Riojas,
Felipa Flores Benavidez,
Maria Aguirre de Schultz,
Nieves Guerrero Chapa, and
Santos Zarate Prieto
[Most Exhibits Omitted; Exhibit B Follows]
aes)
13a
EXHIBIT B TO AMENDED COMPLAINT
[English version; Spanish version omitted in printing]
No. 254
BEFORE THE GENERAL CLAIMS COMMISSION
BETWEEN THE
UNITED MEXICAN STATES AND THE
UNITED STATES OF AMERICA
(Under Convention concluded September 8, 1923)
Docket No. 1203
UNITED MEXICAN STATES
on behalf of
THE Heirs OF MATIAS LONGORIA
against
UNITED STATES OF AMERICA
MEMORANDUM OF CLAIM
Under Rule III, Section 2, Clause (a)
NAME AND ADDRESS OF CLAIMANT:
The Heirs of Matias Longoria
801 Hibbs Bldg.
Washington, D.C.
CHARACTER AND AMOUNT OF CLAIM:
Claimant deprived of property by the authorities of
the United States of America.
$167,300.00 U.S. Currency.
(Proper allowance of interest is also claimed.)
74a
MEMORANDUM
Claimants are the Heirs of Matias Longoria, natural
born citizen of the United Mexican States, and resident
of H. Matamoros, Tampo, Mexico, sets [sic] forth that
the sole heir of Matias Longoria un cuidadano Mexicano,
deceased sis (legal proof of which will hereafter be
submitted), who, on,or about the ...... ee
in the year ...... , was in pursuance of legal authority,
granted a certain tract of land, located in State of Coa-
huila and Texas in what is now the State of Texas, in
the United States of America, as shown by the archives
of the said Province, and more particularly described as
follows: 45,000,000 sq. Varas, abstract No. 129, Starr
County, Texas, approximately 7865 acres.
When the territory in which said lands were located
passed to the sovereignty of the United States of Amer-
ica, the rights of said grantee and his heirs, all natural
born citizens of the United Mexican States, were duly re-
spected, except from trespass, until the year 1870, when
the State of Texas as a State of the United States of
America, then and thereafter assumed to enact certain
laws, to wit: The Act of August 15, 1870, entitled “AN
ACT TO ASCERTAIN AND ADJUDICATE CERTAIN
CLAIMS FOR LAND AGAINST THE STATE SIT-
UATED BETWEEN THE NUECES AND RIO
GRANDE RIVERS” and other acts, thereby and by other
means depriving said heir of ...__.. rights to said
land or the right to enter thereon, all in violation of the
laws of the United States of America, international law
and guarantees provided by the TREATY OF GUADA-
LUPE HIDALGO, between Mexico and the United
States, of 1848; and that the claimant having thus been
deprived of ._... property, as herein described, with-
out due process of law, and without just compensation,
hereby make this claim against the United States of
America for the restoration to claimant, the legitimate
75a
owner of said lands, or for payment of its value, to wit:
$157,300.00 U.S. Currency, plus interest.
POR EL ASENTE DE MEXICO
THE MEXICAN AGENT
By B. Carbajaly Rosas
76a
CERTIFICATE OF SERVICE
I hereby certify that the foregoing First Amended
Class Action Complaint for Taking of Property was, this
18th day of December, 1981, served on counsel for the
defendant by hand-delivery of a copy of same addressed
to:
John H. Shenefield
reter E. Halle
Milbank, Tweed, Hadley & McCloy
1747 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
/s/ Vicki C. Jackson
VICKI C, JACKSON
December 18, 1981
77a
APPENDIX E
28 U.S.C.
§$ 1830. Actions against foreign states
(a) The district courts shall have original jurisdiction
without regard to amount in controversy of any nonjury
civil action against a foreign state as defined in section
1603(a) of this title as to any claim for relief in per-
sonam with respect to which the foreign state is not en-
titled to immunity either under sections 1605-1607 of
this title or under any applicable international agree-
ment.
(b) Personal jurisdiction over a foreign state shall
exist as to every claim for relief over which the district
courts have jurisdiction under subsection (a) where serv-
ice has been made under section 1608 of this title.
(ce) For purposes of subsection (b), an appearance by
a foreign state does not confer personal jurisdiction with
respect to any claim for relief not arising out of any
transaction or occurrence enumerated in sections 1605-
1607 of this title.
* * * o
§ 1602. Findings and declaration of purpose
The Congress finds that the determination by United
States courts of the claims of foreign states to immunity
from the jurisdiction of such courts would serve the in-
terests of justice and would protect the rights of both
foreign states and litigants in the United States courts.
Under international law, states are not immune from
the jurisdiction of foreign courts insofar as their com-
mercial activities are concerned, and their commercial
property may be levied upon for the satisfaction of judg-
ments rendered against them in connection with their
commercial activities. Claims of foreign states to im-
munity should henceforth be decided by courts of the
78a
United States and of the States in conformity with the
principles set forth in this chapter.
7. . * s
§ 1604. Immunity of a foreign state from jurisdiction
Subject to existing international agreements to which
the United States is a party at the time of enactment of
this Act a foreign state shall be immune from the juris-
diction of the courts of the United States and of the
States except as provided in sections 1605 to 1607 of this
chapter.
§ 1605. General exceptions to the jurisdictional immu-
nity of a foreign state
(a) A foreign state shall not be immune from the
jurisdiction of courts of the United States or of the
States in any case—
(1) in which the foreign state has waived its im-
munity either explicitly or by implication, notwith-
standing any withdrawal of the waiver which the
foreign state may purport to effect except in accord-
ance with the terms of the waiver;
(2) in which the action is based upon a commer-
cial activity carried on in the United States by the
foreign state; or upen an act performed in the
United States in connection with a commercial activ-
ity of the foreign state elsewhere; or upon an act
outside the territory of the United States in con-
nection with a commercial activity of the foreign
state elsewhere and that act causes a direct effect in
the United States;
(3) in which rights in property taken in viola-
tion of international law are in issue and that prop-
erty or any property exchanged for such property
is present in the United States in connection with a
commercial activity carried on in the United States
79a
by the foreign state; or that property or any prop-
erty exchanged for such property is owned or op-
erated by an agency or instrumentality of the for-
eign state and that agency or instrumentality is en-
gaged in a commercial activity in the United States;
(4) in which rights in property in the United
States acquired by succession or gift or rights in
immovable property situated in the United States
are in issue; or
(5) not otherwise encompassed in paragraph (2)
above, in which money damages are sought against
a foreign state for personal injury or death, or dam-
age to or loss of property, occurring in the United
States and caused by the tortious act or omission of
that foreign state or of any official or employee of
that foreign state while acting within the scope of
his office or employment; except this paragraph shall
not apply to—
(A) any claim based upon the exercise or
performance or the failure to exercise or per-
form a discretionary function regardless of
whether the discretion be abused, or
(B) any claim arising out of malicious prose-
cution, abuse of process, libel, slander, misrep-
resentation, deceit, or interference with contract
rights.
80a
September 8, 1923
Convention between the United States and Mexico for
reciprocal settlement of claims. Signed at Washington,
September 8, 1923; ratification advised by the Senate,
January 23, 1924; ratified by the President, February
4, 1924; ratified by Mexico, February 16, 1924; ratifica-
tions exchanged at Washington, March 1, 1924; pro-
claimed, March 3, 1924.
BY THE PRESIDENT OF THE UNITED STATES OF AMERICA.
A PROCLAMATION.
WHEREAS a Convention between the United States
of America and the United Mexican States providing for
the amicable settlement and adjustment of claims by the
citizens of each country against the other, was concluded
and signed by their respective Plenipotentiaries at Wash-
ington on the eighth day of September, one thousand nine
hundred and twenty-three, the original of which Conven-
tion, being in the English and Spanish languages is word
for word as follows:
[Spanish omitted]
The United States of America and the United Mexican
States, desiring to settle and adjust amicably claims by
the citizens of each country against the other since the
signing on July 4, 1868, of the Claims Convention entered
into between the two countries (without including the
claims for losses or damages growing out of the revolu-
tionary disturbances in Mexico which form the basis of
another and separate Convention), have decided to enter
into a Convention with this object, and to this end have
nominated as their Plenipotentiaries:
The President of the United States of America:
The Honorables Charles Evans Hughes, Secretary of
State of the United States of America, Charles Beecher
Warren and John Barton Payne, and
8la
The President of the United Mexican States:
Senor Don Manuel C. Tellez, Charge d’Affaires ad in-
terim of the United Mexican States at Washington;
Who, after having communicated to each other their
respective full powers found to be in due and proper
form, have agreed upon the following Articles:
ARTICLE I.
All claims (except those arising from acts incident to
the recent revolutions) against Mexico of citizens of the
United States, whether corporations, companies, associa-
tions, partnerships or individuals, for losses or damages
suffered by persons or by their properties, and all claims
against the United States of America by citizens of Mex-
ico, whether corporations, companies, associations, part-
nerships or individuals, for losses or damages suffered by
persons or by their properties; all claims for losses or
damages suffered by citizens of either country by reason
of losses or damages suffered by any corporation, com-
pany, association or partnership in which such citizens
have or have had a substantial and bona fide interest,
provided an allotment to the claimant by the corporation,
company, association or partnership of his proportion of
the loss or damage suffered is presented by the claimant
to the Commission hereinafter referred to; and all claims
for losses or damages originating from acts of officials or
others acting for either Government and resulting in
injustice, and which claims may have been presented to
either Government for its interposition with the other
since the signing of the Claims Convention concluded be-
tween the two countries July 4, 1868, and which have re-
mained unsettled, as well as any other such claims which
may be filed by either Government within the time here-
inafter specified, shall be submitted to a Commission con-
sisting of three members for decision in accordance with
the principles of international law, justice and equity.
82a
Such Commission shall be constituted as follows: one
member shall be appointed by the President of the United
States; one by the President of the United Mexican
States; and the third, who shall preside over the Com-
mission, shall be selected by mutual agreement between
the two Governments. If the two Governments shall not
agree within two months from the exchange of ratifica-
tions of this Convention in naming such third member,
then he shall be designated by the President of the Per-
manent Administrative Council of the Permanent Court
of Arbitration at The Hague described in Article XLIX
of the Convention for the pacific settlement of interna-
tional disputes concluded at The Hague on October 18,
1907. In case of the death, absence or incapacity of any
member of the Commission, or in the event of a member
omitting or ceasing to act as such, the same procedure
shall be followed for filling the vacancy as was followed
in appointing him.
ARTICLE II.
The Commissioners so named shall meet at Washing-
ton for organization within six months after the ex-
change of the ratifications of this Convention, and each
member of the Commission, before entering upon his
duties, shall make and subscribe a solemn declaration
stating that he will carefully and impartially examine
and decide, according to the best of his judgment and in
accordance with the principles of international law, jus-
tice and equity, all claims presented for decision, and
such declaration shall be entered upon the record of the
proceedings of the Commission.
The Commission may fix the time and place of its sub-
sequent meetings, either in the United States or in Mex-
ico, as may be convenient, subject always to the special
instructions of the two Governments.
83a
ARTICLE III.
In general, the Commission shall adopt as the standard
for its proceedings the rules of procedure established by
the Mixed Claims Commission created under the Claims
Convention between the two Governments signed July 4,
1868, in so far as such rules are not in conflict with any
provision of this Convention. The Commission, however,
shall have authority by the decision of the majority of its
members to establish such other rules for its proceedings
as may be deemed expedient and necessary, not in con-
flict with any of the provisions of this Convention.
Each Government may nominate and appoint agents
and counsel who will be authorized to present to the
Commission, orally or in writing, all the arguments
deemed expedient in favor of or against any claim. The
agents or counsel of either Government may offer to the
Commission any documents, affidavits, interrogatories or
other evidence desired in favor of or against any claim
and shall have the right to examine witnesses under oath
or affirmation before the Commission, in accordance with
such rules of procedure as the Commission shall adopt.
The decision of the majority of the members of the
Commission shall be the decision of the Commission.
The language in which the proceedings shall be con-
ducted and recorded shall be English or Spanish.
ARTICLE IV.
The Commission shal] keep an accurate record of the
claims and cases submitted, and minutes of its proceed-
ings with the dates thereof. To this end, each Govern-
ment may appoint a Secretary; these Secretaries shall
act as joint Secretaries of the Commission and shall be
subject to its instructions. Each Government may also
appoint and employ any necessary assistant secretaries
and such other assistance as deemed necessary. The Com-
mission may also appoint and employ any persons neces-
sary to assist in the performance of its duties.
84a
ARTICLE V.
The High Contracting Parties, being desirous of effect-
ing an equitable settlement of the claims of their respec-
tive citizens thereby affording them just and adequate
compensation for their losses or damages, agree that no
claim shall be disallowed or rejected by the Commission
by the application of the general principle of interna-
tional law that the legal remedies must be exhausted as
a condition precedent to the validity or allowance of any
claim.
ARTICLE VI.
Every such claim for loss or damage accruing prior to
the signing of this Convention, shall be filed with the
Commission within one year from the date of its first
meeting, unless in any case reasons for the delay, satis-
factory to the majority of the Commissioners, shall be
established, and in any such case the period for filing
the claim may be extended not to exceed six additional
months.
The Commission shall be bound to hear, examine and
decide, within three years from the date of its first meet-
ing, ali the claims filed, except as hereinafter provided in
Article VII.
Four months after the date of the first meeting of the
Commissioners, and every four months thereafter, the
Commission shall submit to each Government a report
setting forth in detail its work to date, including a state-
ment of the claims filed, claims heard and claims decided.
The Commission shall be bound to decide any claim
heard and examined within six months after the conclu-
sion of the hearing of such claim and to record its deci-
sion.
ARTICLE VII.
The High Contracting Parties agree that any claim for
loss or damage accruing after the signing of this Con-
vention, may be filed by either Government with the Com-
85a
mission at any time during the period fixed in Article VI
for the duration of the Commission; and it is agreed be-
tween the two Governments that should any such claim
or claims be filed with the Commission prior to the termi-
nation of said Commission, and not be decided as speci-
fied in Article VI, the two Governments will by agree-
ment extend the time within which the Commission may
hear, examine and decide such claim or claims so filed
for such a period as may be required for the Commission
to hear, examine and decide such claim or claims.
ARTICLE VIII.
The High Contracting Parties agree to consider the
decision of the Commission as final and conclusive upon
each claim decided, and to give full effect to such deci-
sions. They further agree to consider the result of the
proceedings of the Commission as a full, perfect and
final settlement of every such claim upon either Govern-
ment, for loss or damage sustained prior to the exchange
of the ratifications of the present Convention (except as
to claims arising from revolutionary disturbances and
referred to in the preamble hereof). And they further
agree that every such claim, whether or not filed and
presented to the notice of, made, preferred or submitted
to such Commission shall from and after the conclusion
of the proceedings of the Commission be considered and
treated as fully settled, barred and thenceforth inadmis-
sible, provided the claim filed has been heard and de-
cided.
ARTICLE IX.
The total amount awarded in all the cases decided in
favor of the citizens of one country shall be deducted
from the total amount awarded to the citizens of the
other country and the balance shall be paid at Washing-
ton or at the City of Mexico, in gold coin or its equiva-
lent to the Government of the country in favor of whose
citizens the greater amount may have been awarded.
86a
In any case the Commission may decide that interna-
tional law, justice and equity require that a property or
right be restored to the claimant in addition to the
amount awarded in any such case for all loss or damage
sustained prior to the restitution. In any case where the
Commission so decides the restitution of the property or
right shall be made by the Government affected after
such decision has been made, as hereinbelow provided.
The Commission, however, shall at the same time deter-
mine the value of the property or right decreed to be
restored and the Government affected may elect to pay
the amount so fixed after the decision is made rather
than to restore the property or right to the claimant.
In the event the Government affected should elect to
pay the amount fixed as the value of the property or
right decreed to be restored, it is agreed that notice
thereof will be filed with the Commission within thirty
days after the decision and that the amount fixed as the
value of the property or right shall be paid immediately.
Upon failure so to pay the amount the property or right
shall be restored immediately.
ARTICLE X.
Each Government shall pay its own Commissioner and
bear its own expenses. The expenses of the Commission
including the salary of the third Commissioner shall be
defrayed in equal proportions by the two Governments.
ARTICLE XI.
The present Convention shall be ratified by the High
Contracting Parties in accordance with their respective
Constitutions. Ratifications of this Convention shall be
exchanged in Washington as soon as practicable and the
Convention shall take effect on the date of the exchange
of ratifications.
87a
In witness whereof, the respective Plenipotentiaries
have signed and affixed their seals to this Convention.
Done in duplicate at Washington this eighth day of
September, 1923.
CHARLES EVANS HUGHES [SEAL. ]
CHARLES BEECHER WARREN _ [SEAL.]
JOHN BARTON PAYNE [SEAL. ]
MANUEL C. TELLEZ [SEAL. ]
AND WHEREAS the said Convention, has been duly
ratified on both parts, and the ratifications of the two
governments were exchanged in the City of Washington,
on the first day of March, one thousand nine hundred
and twenty-four:
NOW, THEREFORE, be it known that I, Calvin
Coolidge, President of the United States of America,
have caused the said Convention to be made public to the
end that the same and every article and clause thereof,
may be observed and fulfilled with good faith by the
United States and the citizens thereof.
IN TESTIMONY WHEREOF, I have hereunto set my
hand and caused the Seal of the United States to be
affixed.
DONE at the city of Washington, this third day of
March, in the year of our Lord one thousand
nine hundred and twenty-four, and of the
[SEAL.] Independence of the United States of Amer-
ica the one hundred and forty-eighth.
CALVIN COOLIDGE
By the President:
CHARLES E. HUGHES
Secretary of State.
88a
Convention between the United States of America and
Mexico respecting claims. Signed at Washington No-
vember 19, 1941; ratification advised by the Senate of
the United States January 29, 1942; ratified by the
President of the United States February 10, 1942;
ratified by Mexico February 12, 1942; ratifications ex-
changed at Washington April 2, 1942; proclaimed by
the President of the United States April 9, 1942.
BY THE PRESIDENT OF THE UNITED STATES OF AMERICA
A PROCLAMATION
WHEREAS a Convention Providing for the Final Ad-
justment and the Settlement of Certain Unsettled Claims
of Nationals of the United States of America and of the
United Mexican States, respectively, against the Govern-
ment of the other country, was concluded and signed by
the respective Plenipotentiaries of the two countries at
Washington on November 19, 1941, the original of which
Convention in the English and Spanish languages, is
word for word as follows:
[Spanish omitted]
The United States of America and the United Mexi-
can States, being desirous of effecting an amicable, ex-
peditious and final adjustment of certain unsettled claims
of the nationals of each country against the Government
of the other country, without resort to methods of inter-
national arbitration for their adjudication, such as those
established in prior agreements, have decided to con-
clude a Convention for that purpose, and to this end
have named as their Plenipotentiaries:
The President of the United States of America:
Mr. Cordell Hull, Secretary of State of the United
States of America; and
The President of the United Mexican States:
89a.
Dr. Francisco Castillo Najera, Ambassador Extraordi-
nary and Plenipotentiary of Mexico to the | ee States
of America;
Who, after having communicated to each other their
respective full powers, found to be in due and proper
form, have agreed upon the following articles:
ARTICLE I
The Government of the United Mexican States agrees
to pay, and the Government of the United States of
America agrees to accept, the sum of $40,000,000.00
(forty million dollars, currency of the United States of
America), as the balance due from the Government of
the United Mexican States in full settlement, liquida-
tion, and satisfiaction of the following claims:
(a) All claims filed by the Governments of the United
States of America and of the United Mexican States with
the General Claims Commission, established by the two
countries pursuant to the Convention signed September
8, 19238;
(b) All agrarian claims of nationals of the United
States of America against the Government of the United
Mexican States, which arose subsequent to August 30,
1927 and prior to October 7, 1940, including those re-
ferred to in the Agreement effected by exchange of notes
signed by the Government of the United States of Amer-
ica and the Government of the United Mexican States on
November 9 and 12, 1938, respectively; and
(c) All other claims of nationals of either country,
which arose subsequent to January 1, 1927 and prior to
October 7, 1940, and involving international responsi-
bility of either Government towards the other Govern-
ment as a consequence of damage to, or loss or destruc-
tion of, or wrongful interference with the property of
the nationals of either country.
90a
ARTICLE II
The Government of the United States of America and
the Government of the United Mexican States agree that
the following claims are not extinguished in consequence
of the stipulations of this Convention:
(a) Claims of nationals of the United States of Amer-
ica against the Government of the United Mexican States,
which arose subsequent to August 30, 1927, and are
predicated upon acts of authorities of the United Mexi-
ean States in relation to petroleum properties, which
claims are the subject of a special agreement;
(b) Claims of nationals of the United Mexican States
against the Government of the United States of America,
which were formally presented to the Government of the
United States of America by the Embassy of the United
Mexican States in its note number 2705 of May 16, 1941;
(c) Claims of nationals of either country, predicated
upon injuries essentially personal, which arose subse-
quent to January 1, 1927 and pricr to the date of the
signing of this Convention;
(d) Claims of the nationals of either country, of the
character of those included in paragraphs (b) and (c)
of Article I of this Convention, which arose subsequent to
October 7, 1940 and prior to the date of the signing of
this Convention; and
(e) Claims of nationals of the United States of Amer-
ica predicated upon default in the payment of the prin-
cipal or of interest on bonds issued or guaranteed by the
United Mexican States, which were not filed with the
Commission established pursuant to the Convention
signed September 8, 1923.
The claims included in paragraphs (b), (c), and (d)
of this Article will be the subject of future agreements
which the two Governments will conclude as soon as pos-
sible.
. oe
Gla
ARTICLE III
The United States of America and the United Mexican
States, in virtue of the stipulations of this Convention,
reciprocally cancel, renounce, and hereby declare satisfied
all claims, of whatsoever nature, of nationals of each
country against the Government of the other, which
arose prior to the date of the signing of this Convention,
whether or not filed, formulated or presented, formally
or informally, to either of the two Governments, except
those claims which are included in Article II of this
Convention.
The twe Governments agree that, with respect to in-
ternational obligations and rights of each Government
towards the other, the stipulations of this Convention
supersede the stipulations of the General Claims Conven-
tion signed September &, 1923, and those of the Protocol
signed April 24, 1934, which refers to that Conven-
tion, and those of the Agrarian Claims Agreement ef-
fected by exchange of notes signed November 9 and 12,
1938.
ARTICLE IV
There is credited against the sum of $40,000,000.00
(forty million dollars, United States currency) men-
tioned in Article I of this Convention the sum of
$3,000,000.00 (three million dollars, United States cur-
rency), the total sum of payments made, prior to the
signing of this Convention, to the Government of the
United States of America by the Government of the
United Mexican States pursuant to the Agreement in re-
lation to agrarian claims, effected by the exchange of
notes signed November 9 and 12, 1938. There shall also
be credited the additional sum of $3,000,000.00 (three
million dollars, United States currency) which will be
paid on the date of the exchange of ratifications of this
Convention.
92a
The balance of $34,000,000.00 (thirty-four million dol-
lars, United States currency) shall be paid by the Gov-
ernment of the United Mexican States to the Govern-
ment of the United States of America at Washington, in
annual instalments, beginning one year after the date of
the signing of this Convention, of $2,500,000.00 (two
million, five hundred thousand doliars, United States cur-
rency) until the complete liquidation of this debt. The
Government of the United Mexican States may, in its
discretion, for the purpose of reducing the period for
complete liquidation of the balance due, increase the
amount of any of the annual instalments, or pay any
such instalment or instalments in advance.
In consideration of the stipulations of this Convention
it is agreed that the United Mexican States is relieved
of the obligation to make further payments pursuant to
the provisions of the Agreement in relation to agrarian
claims effected by the exchange of notes signed Novem-
ber 9 and 12, 1938.
ARTICLE V
In the event of failure to pay any annual instalment,
or instalments, when due, the United Mexican States
shall pay interest at the rate of one per centum per an-
num on the amount of each such instalment, or instal-
ments, from the date when the instalment, or instal-
ments, became due up to the date of the payment.
ARTICLE VI
This Convention shall be ratified and shall become ef-
fective upon the exchange of ratifications which shall
take place at Washington as soon as possible.
IN WITNESS WHEREOF, the respective Plenipotentiaries
have signed and affixed their seals to this Convention.
DONE in duplicate, in English and Spanish, at Wash-
ington, this nineteenth day of November, 1941.
93a
[SEAL] CORDELL HULL
[SELLO] F. CASTILLO NAJERA
AND WHEREAS, the said Convention has been duly rati-
fied on both parts, and the ratifications of the two Gov-
ernments were exchanged at the city of Washington on
the second day of April, one thousand nine hundred and
forty-two;
NOW, THEREFORE, be it known that I, Franklin D.
Roosevelt, President of the United States of America,
have caused the said Convention to be made public to the
end that the same and every article and clause thereof
may be observed and fulfilled with good faith by the
United States of America and the citizens thereof.
IN TESTIMONY WHEREOF, I have hereunto set my hand
and caused the seal of the United States of America to
be affixed.
DONE at the city of Washington this ninth day of
April, in the year of our Lord one thousand
[SEAL] nine hundred and forty-two, and of the Inde-
pendence of the United States of America
the one hundred and sixty-sixth.
FRANKLIN D ROOS
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