2008 International Law Update, Volume 14, Number 6 (June)

2008 International Law Update, Volume 14, Number 6 (June)

Legal Analyses published by Mike Meier, Attorney at Law. Copyright 2017 Mike Meier. www.internationallawinfo.com. 

ARBITRATION

First Circuit holds that subsequent oral agreement is subject to foreign arbitration agreement contained in prior written contract and that Circuit Court has jurisdiction to hear interlocutory appeal of this matter under Federal Arbitration Act and Convention on Recognition and Enforcement of Foreign Arbitral Awards

In October, 2004 Sourcing Unlimited, Inc, d/b/a Jumpsource (Plaintiff), a Massachusetts corporation, entered into a written partnership agreement (Agreement) with Asimco Technologies, Inc. (ATL), a Delaware corporation headquartered in China. John Perkowski, the Chairman and CEO of ATL, was also Chairman of Asimco International, Inc. (Asimco). Michael Porter, the CEO Plaintiff, and Wilson Ni, President of ATL, signed the Agreement. Neither Asimco nor any other of ATL’s subsidiaries did so.

The Agreement contained an arbitration clause and a choice‑of‑law clause that stated: “This agreement shall be governed by, and construed in accordance with, the laws of the P.R. China, without regard to conflicts of laws principles thereof. Any action to enforce, arising out of, or relating in any way to, any of the provisions of this agreement shall be brought in front of a P.R. China arbitration body.” [Slip Op. 1‑2] After disputes arose with ATL, Plaintiff filed suit in a Massachusetts Court in June 2007. The complaint named only Asimco and Perkowski as Defendants, and claimed that Plaintiff had entered into an oral contract with Perkowski.

Defendants next removed the case to the Massachusetts federal court. Defendants moved to dismiss, arguing that the complaint failed to state valid claims and calling for dismissal in favor of arbitration based on the Federal Arbitration Act (FAA), 9 U.S.C. Sections 201‑208, which implements the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), Sept. 30, 1970, 21 U.S.T. 2517; T. I. A. S. No. 6997, reprinted at 9 U.S.C.A. Section 201 at 511 (West 1999).

“[Defendant]’s motion argued that the arbitration clause in the Jump source‑ATL contract was subject to [FAA] Chapter 2 and the New York Convention because (1) there was a written arbitration agreement; (2) the agreement provided for arbitration in the territory of a signatory to the Convention; (3) the agreement arose in a commercial relationship; and (4) the commercial relationship is related with [sic] a foreign state.”

Defendants countered that the oral agreement between Plaintiff and Perkowski was a modification of the written Agreement and that Plaintiff should not be able to evade the arbitration clause by suing Asimco and Perkowski. Defendants asked the court to dismiss the complaint in favor of arbitration. Plaintiff replied that the oral agreement constituted a separate contract not subject to the arbitration agreement.

The district court denied the Defendants’ motion to dismiss and they filed an interlocutory appeal. The U.S. Court of Appeals for the First Circuit remands with instructions to enter an order to compel arbitration and to dismiss the case. Plaintiff moved to dismiss this interlocutory appeal for lack of appellate jurisdiction because Asimco is not party to a written arbitration agreement.

The Court disagrees. The Federal Arbitration Act (FAA), 9 U.S.C. Sections 201‑208, through 9 U.S.C. Section 16(a)(1), creates three explicit statutory exceptions to the ordinary rule against interlocutory appeals. “The FAA, in 9 U.S.C. Section 206, authorizes federal courts to compel international arbitration according to agreements subject to the [Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention) Sept. 30, 1970, 21 U.S. T. 2517, T. I. A. S. No. 6997]. Section 16(a)(1)(C), in turn, allows interlocutory appeals of orders refusing to compel arbitration under Section 206.”

“[Plaintiff] urges this court to adopt the rule of two sister circuits that reject interlocutory appeals taken under different provisions of Section 16(a)(1) from orders denying motions to compel domestic arbitration when the parties are not signatories to a written arbitration agreement. ...This appeal concerns an agreement to arbitrate an international commercial dispute, which is subject to the New York Convention and Chapter 2 of the FAA.”

“Chapter 2 of the FAA employs broader statutory language than does Chapter 1. The Chapter 2 provision authorizing district courts to compel international arbitration reads, ‘A court . . . may direct that arbitration be held in accordance with the agreement at any place therein provided for, whether that place is within or without the United States.” 9 U.S.C. Section 206. We do not read anything in the language of Chapter 2 to suggest that a party seeking an appeal from an order denying international arbitration must have signed a written arbitration agreement firsthand.”

“To erect a bright‑line rule that this court lacks jurisdiction to review appeals taken under Section 16(a)(1)( c) ... unless all parties to the dispute are signatories to a written arbitration agreement would insulate a whole class of denials of motions to compel arbitration from review until after the litigation has run its course. Such a rule would contravene the courts’ obligation to enforce arbitration agreements under the New York Convention and Chapter 2 of the FAA.” [Slip Op. 5‑6]

Addressing the merits, the Court notes that “[t]he present dispute is sufficiently intertwined with the Jumpsource‑ATL Agreement for application of estoppel to be appropriate. On these facts, there is no need to explore further what is required to show intertwining. Most of Jumpsource’s claims either directly or indirectly invoke the terms of the Jumpsource‑ATL Agreement.” [Slip Op. 8]

Citation: Sourcing Unlimited, Inc., v. Asimco International, Inc., 526 F.3d 38 (1st Cir. 2008).

COMITY

Eleventh Circuit rules that District Court should have deferred to Belizean Court’s decision interpreting certain Articles of Association, where case’s only connection with U.S. consisted of payments made to Bank in Miami

In the Fall of 2003, Innovative Communications Company (ICC) and its subsidiary Belize Telecom (BT) (Appellants) entered into an agreement to purchase stock in Belize Telecommunications Limited (BTL) from the Government of Belize (Government). After Appellants had failed to make certain obligated payments, the Government seized their shares and replaced 4 board members that appellants had appointed with new members.

The companies brought action in both the U.S. and Belize to litigate the interpretation of the BTL Articles of Association. Appellants filed suit in a Florida federal court; it granted a preliminary injunction reinstating Appellant’s 4 board members on March 11, 2005. The U.S. district court issued a contempt order against the Belize Government after the Government and other shareholders voted to replace the directors appointed by appellants. In June 2005, the federal court held a bench trial that resulted in a verdict for the Government; it also vacated the preliminary injunction and contempt order.

Meanwhile, Belize had filed an action its courts for a declaratory judgment after the issuance of the preliminary injunction. The Belize Supreme Court (of first instance) ruled for the Government. The U.S. district court held that it had no duty to defer to the Belizean decision. After the Belize Court of Appeals (BCA) reversed the decision of the Belize Supreme Court, the Appellants moved for reconsideration in the U.S. district court. The district court adhered to its earlier ruling, and an appeal ensued.

The U.S. Court of Appeals for the Eleventh Circuit affirms in part and reverses in part.

Here, the Belize courts had resolved the proper interpretation of Article 90(D)(ii). The trial court interpreted Article 90(D)(ii), which the BCA later reversed. The U.S. district court refused to recognize either Belizean decision. This Eleventh Circuit, however, concludes that international comity required deference to the Belizean decision.

“This circuit [has] identified the primary concerns in an international comity analysis: ‘(1) whether the judgment was rendered via fraud; (2) whether the judgment was rendered by a competent court utilizing proceedings consistent with civilized jurisprudence; and (3) whether the foreign judgment is prejudicial, in the sense of violating American public policy because it is repugnant to fundamental principles of what is decent and just.’ [Cite]. We also identified the relative strengths of the foreign and domestic interests in the litigation as relevant to a consideration of international comity. [Cite]”

“In this case, neither party has argued that the Belizean judgments were rendered via fraud or that the Belizean proceedings lacked any element of civilized jurisprudence. We see no evidence that the Belizean judicial system affords litigants treatment that is inconsistent with American notions of due process. Our analysis therefore turns to whether the Belizean judgment violates American public policy.”

“[The Belizean Court’s] interpretation allows for the possibility of ‘entrenched directors.’... While we acknowledge the potential difficulty created by the possibility of entrenched directors, we cannot say that the [BCA] decision violates American public policy. The Court of Appeals decision merely gives effect to the plain language of the BTL Articles of Association.” [Slip Op. 14‑16]

“The final element in our consideration of international comity is the relative strengths of the domestic and foreign interests in the litigation. In this case it is clear that the interests of Belize far outweigh the American interests. This case involves the interpretation of the articles of association of a Belizean corporation pursuant to Belize law. The consequences of the litigation affect Belizean parties, and to the extent that the litigation might have any effect on the delivery of telecommunications services, the effect would be on the citizens of Belize.”

“None of the parties to the litigation is an American corporation; the lawsuit’s connection to the U.S. results from the renegotiated payment arrangements involving, tangentially, the International Bank of Miami ... Accordingly, we find that all of the international comity factors clearly favor deference to the Belizean decision.”

“Three considerations are relevant to the second factor, I. e., fairness to litigants – in the international abstention analysis: ‘(1) the order in which the suits were filed; (2) the more convenient forum; and (3) the possibility of prejudice to parties resulting from abstention.’ [Cite].”

“The other two considerations favor the Belizean forum. The above discussion – indicating that the interests of Belize far outweigh any American interests – also leads to the conclusion that the Belizean forum was more convenient than the American forum. With respect to the prejudice factor, this consideration focuses on whether the party opposing deference to the foreign forum will receive a fair and impartial trial in [that] forum. [Cite]. We readily conclude that the Government received a fair and impartial trial and appeal in Belize. Indeed, we note that it was the Government that initiated the litigation in Belize.” [Slip Op. 18‑20]

Citation: Belize Telecom LTD., v. Government of Belize, 528 F.3d 1298 (11th Cir. 2008).

IMMIGRATION

U.S. Supreme Court rules 5 to 4 that Immigration and Naturalization Act must be construed to allow alien opportunity to withdraw motion for voluntary departure, provided alien makes request before expiration of departure period

Petitioner Samson Taiwo Dada (Petitioner), native and citizen of Nigeria, came to the U.S. in April 1998 on a temporary nonimmigrant visa. He overstayed it. Petitioner claims that he married an American citizen in 1999. His wife filed an I‑130 Petition for Alien Relative on his behalf. She failed to produce the required documentary evidence in support, however, so immigration authorities denied his petition in February 2003.

In 2004, the Department of Homeland Security (DHS) charged Petitioner with being removable under the Immigration and Nationality Act (INA) [66 Stat. 201, as amended, 8 U.S.C. Section 1227(a)(1)(B) (2000 ed., Supp. V)] for overstaying his visa. Petitioner’s wife then filed a second I‑130 petition. The Immigration Judge (IJ) denied Petitioner’s request for a continuance pending adjudication of the newly filed I‑130 petition, pointing out that those petitions take an average of about three years to process. The IJ found Petitioner removable but granted his request for voluntary departure under the INA.

The Board of Immigration Appeals (BIA) affirmed on November 4, 2005, without a written opinion. It ordered Petitioner to depart within 30 days or suffer certain statutory penalties. These involved a civil fine of not less than $1,000 nor more than $5,000, and ineligibility for relief under the INA for 10 years.

On December 2, 2005, two days before the 30‑day period ran out, Petitioner asked to withdraw his request for voluntary departure. At the same time he filed with the BIA a motion to reopen removal proceedings under the INA. He argued that his motion recited new and material evidence showing a bona fide marriage and that the IJ should continue his case until the decision on the second I‑130 petition.

After the voluntary departure period had ended, the BIA denied the request. It reasoned that the statute bars an alien on the voluntary departure track who fails to leave the U.S. in a timely fashion from receiving adjustment of status. It did not consider Petitioner’s request to withdraw his voluntary departure request. The Fifth Circuit affirmed. On a grant of certiorari, a bare majority of the Supreme Court reverses and remands. It rules that the statute must allow an alien a chance to withdraw a motion for voluntary departure, provided he or she makes the request before the departure period has run out.

Resolution of this case turns on the interplay between two aspects of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 – [1] the alien’s right to file a motion to reopen in removal proceedings and [2] the rules governing voluntary departure. Voluntary departure is discretionary relief that allows certain favored aliens to leave the country willingly.

First, it helps the Government, for example, by speeding up the departure process and avoiding the expense of deportation proceedings. It also benefits the alien by, e.g., facilitating readmission. To earn these benefits, the alien must depart in a timely manner. As relevant here, when the alien asks for a voluntary departure at the end of removal proceedings, the departure period may not last longer than 60 days.

The INA allows an alien to file one motion to reopen, such as by asking the BIA to change its decision because of newly discovered evidence or changed circumstances. The alien must generally file his/her motion within 90 days of a final administrative removal order. The statutory text plainly guarantees to each alien the right to file one motion to reopen proceedings under this section.

Section 1229c(b)(2) clearly states that the voluntary departure period shall not be valid for more than “60 days,” but says nothing about the motion to reopen; and nothing in the statutes or past usage indicates that voluntary departure or motions to reopen cannot coexist. The Government contends that an alien who has agreed to voluntarily depart is not entitled to pursue a motion to reopen; this argument is unsustainable. Reading the Act as a whole, and considering the statutory scheme governing voluntary departure alongside the statutory right to pursue “one motion to reopen,” it would render the statutory reopening right a nullity in most voluntary departure cases. This is because it is foreseeable, and quite likely, that the voluntary departure time will expire long before the BIA decides a timely‑filed motion to reopen.

“Absent tolling or some other remedial action by the Court, then, the alien who is granted voluntary departure but whose circumstances have changed in a manner cognizable by a motion to reopen is between Scylla and Charybdis: He or she can leave the United States in accordance with the voluntary departure order; but, pursuant to regulation, the motion to reopen will be deemed withdrawn. Alternatively, if the alien wishes to pursue reopening and remains in the U.S. to do so, he or she risks expiration of the statutory period and ineligibility for adjustment of status, the underlying relief sought.”

“The purpose of a motion to reopen is to ensure a proper and lawful disposition. We must be reluctant to assume that the voluntary departure statute was designed to remove this important safeguard for the distinct class of deportable aliens most favored by the same law. ... This is particularly so when the plain text of the statute reveals no such limitation. See Costello v. INS, 376 U.S. 120, 127‑128 (1964) (counseling long hesitation ‘before adopting a construction of [the statute] which would, with respect to an entire class of aliens, completely nullify a procedure so intrinsic a part of the legislative scheme’); see also Stone v. INS, 514 U.S. 386, 399 (1995) (‘Congress might not have wished to impose on the alien’ the difficult choice created by treating a motion to reopen as rendering the underlying order nonfinal for purposes of judicial review); INS v. St. Cyr, 533 U.S. 289, 320 (2001) (recognizing the longstanding principle of construing any lingering ambiguities in deportation statutes in favor of the alien ” (quoting INS v. Cardoza‑Fonseca, 480 U.S. 421, 449 (1987)).”

It is thus necessary to read the Act to preserve the alien’s right to pursue reopening while respecting the Government’s interest in the voluntary departure arrangement’s quid pro quo. There is no statutory authority for Petitioner’s proposal to automatically toll the voluntary departure period during the motion to reopen’s pendency.

Voluntary departure is an agreed‑upon exchange of benefits, much like a settlement agreement. An alien who is permitted to stay past the departure date to wait out the motion to reopen’s adjudication cannot then demand the full benefits of voluntary departure, for the Government’s benefit – a prompt and costless departure – would be lost. It would also invite abuse by aliens who wish to stay in the country but whose cases are unlikely to be reopened.

Absent a valid regulation otherwise, the appropriate way to reconcile the voluntary departure and motion to reopen provisions is to allow an alien to withdraw from the voluntary departure agreement. The Department of Justice, which has authority to adopt the relevant regulations, has made a preliminary determination that the Act permits an alien to withdraw a voluntary departure application before expiration of the departure period. Although not binding in the present case, this proposed interpretation “warrants respectful consideration.” Wisconsin Dept. of Health and Family Servs. v. Blumer, 534 U.S. 473, 497. To safeguard the right to pursue a motion to reopen for voluntary departure recipients, the alien must be permitted to withdraw, unilaterally, a voluntary departure request before the departure period expires, without regard to the motion to reopen the underlying merits.

The alien has the option either to abide by the voluntary departure’s terms, and receive its agreed‑upon benefits; or, alternatively, to forgo those benefits and remain in the country to pursue an administrative motion. An alien selecting the latter option gives up the possibility of readmission and becomes subject to the IJ’s alternative order of removal. The DHS may remove the alien within 90 days, even if the agency hasn’t yet adjudicated the motion to reopen. But the alien may move for a stay of the removal order.

Although the BIA has discretion to deny a motion for a stay based on the merits of the motion to reopen, it may amount to an abuse of discretion for the BIA to deny a motion for stay where the motion sets forth nonfrivolous grounds for reopening. Of course, this interpretation still presents the alien with a hard choice but it does escape both the quixotic results of the Government’s proposal and the elimination of benefits to the Government that would follow from Petitioner’s tolling rule.

Citation: Dada v. Mukasey, 128 S. Ct. 2307, 6 U.S. L. W. 4461 (Sup. Ct. June 16, 2008).

INTERNATIONAL CONFLICTS OF JURISDICTION

U. K. Privy Counsel reviews judgment of Bahamas Court of Appeal and disapproves failure of Florida bankruptcy judge to observe international comity when it entered orders that purported to cancel orders of Bahamas court pertaining to sale of Bahamas real estate

This unnecessarily complicated case before the Privy Council deals with a sale of Bahamas real property under a court order. The property in question is a one‑story residence on a plot of land known as Lot 32, North Cat Cay. Though in a desirable location, the house is in a poor state of repair and seems to have been empty for long periods.

Part of the difficulty is that although the litigation has so far produced seven orders (some interlocutory and some final) made by Bahamas first instance Judge Lyons, it was only at the hearing leading up to Order (6) that the judge heard oral evidence from deponents followed by cross‑examination.

Another complication has been the concurrent Florida bankruptcy litigation involving Mr. James F. Walker, one of the Petitioners, initially with questionable regard to the principles of international comity.

The first 5 orders include Order (1) of September 3, 2002 for the sale of Lot 32 (then owned by the bankrupt and his wife) to Susan Lundborg (Respondent); Order (2) of July 7, 2003 that the parties complete the sale within 14 days; Order (3) of July 21, 2003 (not in the record) embodying an undertaking that Respondent would not proceed pending an application for a stay of the order for sale made by Mr. Walker’s Florida trustee in bankruptcy; Order (4) of March 23, 2004 allowing Respondent’s intervention and rejecting the trustee’s application for a stay; and Order (5) dated July 26, 2004 and applied for by Mrs. Walker which stayed the order for sale until the court could resolve the disputed issues by cross‑examining the deponents.

Two more orders need consideration: Order (6) of December 7, 2004 (after the lower court had heard some oral evidence) setting aside the order for sale; and Order (7) dated February 28, 2005 setting aside a money judgment which a bankruptcy Plaintiff, Eleanor C. Cole, had obtained against Mr. Walker in the Supreme Court of the Bahamas on December 3, 1996, which purported to enforce an earlier Florida judgment against the bankrupt.

The Petitioners’ appeal to the Judicial Board of the Privy Council is from a November 15, 2005 order of the Bahamas’ Court of Appeal It set aside Orders (6) and (7). The Board has to resolve the appeal based on the points at issue, and, incomplete as they are, on Judge Lyons findings of fact.

Plaintiff, the Petitioners and the Respondent are all U.S. citizens living in Florida. The Petitioners, however, at one time did reside in the Bahamas. In 1983, they bought Lot 32 as joint tenants. They immediately mortgaged it back to the previous owners and have since paid off that mortgage.

In October 1990, Plaintiff sued Mr. Walker in the Bahamas’ court to enforce a November 1989 Florida judgment for about $300,000 which she had gotten against him. Mr. Walker had entered an unconditional appearance and the court had given summary judgment against him in April 1991. A month later, however, he got an order setting aside the judgment on the ground that he was challenging the original Florida judgment. Five years went by but the Florida judgment technically remained in effect. On December 3, 1996, Plaintiff again obtained summary judgment in her enforcement proceedings in the Bahamas.

Under Section 63 of the Supreme Court Act, this judgment placed an enforceable equitable charge on Mr. Walker’s interest in Lot 32. The charge did not affect Mrs. Walker’s interest, but it did enable Plaintiff to apply to the court under Order 31 of the Supreme Court Rules for an order to sell all the interests in Lot 32. This charging order severed the joint tenancy. Half the net proceeds would go to Mrs. Walker and the court would have applied the other half to satisfy Plaintiff’s judgment debt.

There was then a further delay before Plaintiff’s attorneys, Callenders & Co. of Nassau, took steps to enforce the equitable charge. Plaintiff’s attorneys obtained a professional appraisal in June 1997 that valued Lot 32 at $326,250. On June 18, 1999 they finally sought an order for sale. Those are the proceedings in which the lower court made all but the last of the seven orders; the court issued Order (7) in Proceedings 1355 of 1990.

When the Court exercises its power to order a sale, the usual course is to make an order in general terms, entrusting the conduct of the sale to a specified party, and giving general directions as to the manner of sale (e.g. by public auction or private treaty), the minimum price, and so on. That was the relief Plaintiff sought by the originating summons with Petitioners as the original defendants, and former owner Mrs. Krafft Keims, now a widow, added as a third defendant in June 1999.

On August 18, 1999, Sidney Collie, a Nassau attorney, entered an appearance for Petitioners through Gary Rotella, a Florida attorney, whom Mr. Walker had instructed; the three of them met at Rotella’s office in Fort Lauderdale on August 14, 1999. Mr. Walker asked Collie to act for both Petitioners. Collie’s evidence, which the judge accepted, was that his only contact was with Mr. Walker (and not his wife) and even those contacts were few and far between.

The rest of 1999, the whole of 2000 and most of 2001 went by without any progress. Plaintiff’s Nassau attorney, a Mr. Turnquest of the Callenders firm, wrote to her on July 31, 2001 apologising for the delay. His letter stated that he did not think that another appraisal of the property was necessary.

Plaintiff (who was by this time an elderly lady in poor health) finally swore her first affidavit in support of the originating summons on January 9, 2002. Plaintiff’s affidavit averred that Respondent, who lived in Florida, had gotten in touch with her and said she was interested in buying Lot 32. On January 27, 2002, Respondent sent Plaintiff a document described as a “letter of intent” for the sale and purchase of the property for $400,000. Plaintiff seemed, initially at least, to have been grateful to Respondent for her intervention.

During the summer of 2002, there was renewed contact between the bankrupt and Collie. The bankrupt seems to have found out about Respondent’s interest in the property and about the prospect of the originating summons eventually coming before the court. The trial court heard the originating summons on the afternoon of September 3, 2002. That morning, Saunders, a Nassau attorney, swore out an affidavit exhibiting the five‑year‑old appraisal. In his first affidavit, he asked the court to set a reserve price of $326,250.

Mr. Saunders then swore to a second affidavit, the text of which in part was as follows: “1. I am authorised by the Plaintiff ... [to present] to this Honourable Court ... a bona fide offer to purchase [Lot 32 by “private contract”], the Plaintiff being resident out of the Bahamas in the State of Florida. There is now produced and shown to be marked ‘JMS 1’ a true copy of a written offer dated September 3, 2002 made by [Respondent] a U.S. Citizen, to buy Lot 32 for $400,000. ... In the premises I pray that this Honourable Court authorise a sale of the subject property to the said [Respondent] at the price indicated.”

Neither Saunders nor Turnquest has since explained how this offer had providentially arrived at their firm’s office on the very morning of the hearing, or how he had obtained Plaintiff’s authority to present the offer to the Court. Respondent swore an affidavit on May 22, 2003 deposing that Turnquest “represents Plaintiff generally but myself as well for the purposes of this transaction.”

Against that, Plaintiff’s daughter, Caroline, deposed on July 26, 2004: “I also assisted my mother in communicating with her then lawyer, Stephen Turnquest. Mr. Turnquest was not authorised to represent to this Court on September 3, 2002, that my mother consented to the $400,000 offer, which she had rejected on numerous occasions over the course of the previous eight months.”

Judge Lyons (as to Order (6)) accepted Petitioners’ and Collie’s evidence about this: “ ... I have had the opportunity of observing Petitioners. What they both said was that they never gave Collie express instruction to accept the $400,000 offer from Respondent.”

“It seems therefore that ... Collie came to court full of good intentions. On November 3, he had ... general instructions to do what he could to help Bankrupt’s predicament. But he accepts he never had express instructions to bind the Petitioners to Respondent’s $400,000 offer ...” Judge Lyons then ordered the sale of Lot 32 ... to Respondent within the terms of her offer.

Turnquest, whose evidence in Florida was that he had started to act for Respondent at Plaintiff’s express request but found himself in the awkward position of having two clients with sharply conflicting interests.

Mr. Walker’s bankruptcy in Florida had a great influence on the U.S. parties’ conduct in the Bahamas litigation. In retrospect, it had only a marginal relevance to the issues that the Board has to decide. Nor has the Board heard any argument about any issues of private international law.

“In the Bahamas, there are no statutory provisions for cross‑border assistance in insolvency with an international element involving the U.S. Under general principles of private international law, one country will usually recognise the status of a trustee in bankruptcy (or similar officer) appointed by another country, and will also recognise his title to moveable (but not to immoveable) property situated in the recognising country.”

“Mr. Walker’s interest constituted immoveable property. Even if, under Florida bankruptcy law, Mr. Walker’s world‑wide estate, moveable and immoveable, vested in his bankruptcy trustee, courts in the Bahamas would not recognise the trustee’s title to immoveable property within its jurisdiction.” [¶ 25]

On January 10, 2003 a Florida bankruptcy judge (FBJ) appointed Linda Walden as receiver for Plaintiff to get hold of Mr. Walker’s assets. During February, the FBJ subpoenaed Respondent to produce documents for the purposes of the receivership. On April 25, 2003, Mr. Walker (through his Florida attorney, Rotella) filed for Chapter 7 bankruptcy.

Plaintiff proved in the bankruptcy and proposed Ms. Walden as trustee, an appointment the FBJ confirmed on July 9, 2003. On July 17, (as a direct result of the Walkers finally finding out about the sale order), the FBJ held an emergency hearing at which he took it upon himself to declare that “the orders issued on or about July 7 2003 by the Commonwealth of the Bahamas” were null and void. The FBJ ordered that there should be no sale of the property without his authority.

Ms. Walden faxed a copy of the Florida order directly to Judge Lyons, who was “understandably affronted.” On May 5, 2004, the FBJ withdrew his declaratory order after a hearing.

Although Plaintiff had proved in the bankruptcy, she seems to have become increasingly disillusioned about legal processes both in the Bahamas and in Florida. At some point, the Florida court removed Ms. Walden from office. Plaintiff herself ceased to take part (either personally or by a legal representative) in either branch of the litigations.

The FBJ discharged Mr. Walker from bankruptcy on September 21, 2005. On November 20, 2007, there was a further order setting aside the original Florida judgment of November 14, 1989.

Meanwhile, back in the Bahamas, Turnquest found himself with two clients, Plaintiff and Respondent with conflicting interests. Plaintiff was telling him (through Ms. Gwynn, her Florida attorney,) not to deal with Respondent. Her later evidence to Judge Lyons (which he accepted) was that, in the course of giving the deposition, she became aware of a sale of the property, to which she was not a party. Petitioners both claimed persuasively that they only became aware of the full facts on July 25, 2003, when an associate of Collie passed the information to Rotella.

Shortly before this, Turnquest had obtained Order (2) of July 7, 2003. This order raised a number of puzzling questions. It still listed Turnquest as appearing on behalf of Plaintiff although the relief he applied for was contrary to her instructions. Petitioners knew nothing about it either.

On or about July 11, 2003, Respondent deposited $402,000 with the Callenders firm. According to Turnquest’s evidence to the FBJ on May 5, 2004, the above sum about equaled the full purchase price. Turnquest deducted about $44,000 for professional fees due to him from Plaintiff – but without telling her. He ceased to act for her on July 21, 2003. Mr. Knox, QC for Petitioners, told the Board that the balance of the $402,000 has since been repaid to Respondent.

The Florida bankruptcy now began to directly impact the Bahamas litigation. Ms. Walden, the then trustee, faxed the nullifying declaratory order to Judge Lyons on July 17, 2003. Ms. Walden arrived in Nassau soon after. She hoped to have the local court vacate the Lot 32 sale order. On July 21, 2003, there was a hearing before Judge Lyons attended by Turnquest (for Respondent), Moxey (for the trustee), Collie (for the Petitioners) and Ms. Gwynn and another Florida attorney (for Plaintiff).

Turnquest agreed on behalf of Respondent not to go ahead with the sale pending resolution of Ms. Walden’s formal application to intervene and seek a stay. On the same day, the Callenders firm gave notice of their appointment as attorneys for Respondent, although she was not yet a party to the proceedings. She moved to intervene on January 14. 2004.

In March 2004, Respondent deposed that she was fairly experienced in, and knowledgeable about, business matters, including property values, and she did not look upon Lot 32 as worth even $326,000.

Plaintiff’s daughter Caroline (who lived with her), however, contradicted this evidence. She deposed that her mother was not willing to sell for $400,000 and that Respondent “persisted in harassing my mother by calling at our house until I obtained a restraining order prohibiting her from contacting my mother.”

Only Petitioners and Collie have been cross‑examined on their affidavits in these proceedings. On March 23, 2004, Judge Lyons heard the applications by Ms. Walden and Respondent together, Order (4). Turnquest, Moxey and Collie were present. Judge Lyons gave a short judgment which suggests that he was still annoyed about the FBJ having purported to nullify his sale order. He concluded that there was “absolutely no doubt in my mind that there is a binding contract for purchase/sale between Respondent and Petitioners.”

On April 27, 2004, Plaintiff made an affidavit in the bankruptcy proceedings averring that she had never met Saunders and had never given him authority to make his affidavit dated September 3, 2002. She also made an affidavit sworn on June 15, 2004 in the Board’s proceedings. It deposed that Turnquest had been acting contrary to Plaintiff’s instructions when the first and second orders were made.

In June of 2004, Mrs. Walker, acting through new attorneys, Lockhart & Munroe of Nassau, applied for an order staying the sale to Respondent under Orders (1) and (2) on the grounds (1) that the attorneys’ representations to the court on her behalf lacked her knowledge or authority; (2) that the orders had first come to her attention long after they were made; and (3) that Respondent’s offer was far below the true value of the property. She added that she would rely on affidavits by herself, her husband and Rotella. There were also affidavits from Collie, Miss Cole, and the local appraiser, a Mr. Lowe of HG Christie Real Estate.

Mr. Lowe valued Lot 32 at $950,000 as of June 16, 2004, with a retrospective valuation of $640,000 as of September 3, 2002. Mrs. Walker made her application eleven months after she had learned the full facts and just under three months after the rejection of the trustee in bankruptcy’s application.

Finally, on February 28, 2005, Judge Lyons set aside Order (7) dated December 3, 1996 made in the proceedings 1355 of 1990. The judge based his decision on the fact that Mr. Walker was not a resident in the Bahamas at the time of service but Plaintiff had not obtained leave to serve him out of the jurisdiction.

At the hearing on Order (6), Mr. Lockhart’s skeleton arguments relied on two main points: first, that Plaintiff had no cause of action against Mrs. Walker, since the charging order did not bind her share; and second, that Mr. Collie had no authority, actual or ostensible, to agree or consent to the sale order on behalf of Mrs. Walker.

Mr. Turnquest’s skeleton arguments relied on four main points: first, that the court had no jurisdiction to set aside the first and second orders because there had been no “new occurrence” within Order 45 rule 11; second, that Mr. Collie had implied or ostensible authority to bind Mrs. Walker; third, that the first order had been perfected for more than two years; and fourth, that the order was not impeachable, as against Respondent under Section 57 of the Conveyancing and Law of Property Act.

“... [T]he only oral evidence was from Collie, Mr. Walker and Mrs. Walker. The judge accepted their evidence. In his heavily edited “extempore” judgment , the judge held that he must set aside Order (1) because Collie had no authority to bind Mrs. Walker to it. That was effectively the only surviving ground of Mr. Lockhart’s application. Mr. Turnquest clung to the four main points in his skeleton argument. The judge ... seems to have forgotten, or not to have accepted, Mr. Lockhart’s concession about Order 31. ...” That was an error because, although Plaintiff’s security extended only to Mr. Walker’s share in the property, Order 31 enabled the court to authorise a sale of the property as a whole. An undivided share of a residential property is not a marketable asset. ...”

“Their Lordships consider that the judge made a further error in his analysis ... of Order (1) He treated the order not as a judicial exercise of the court’s inherent and statutory jurisdiction, but essentially as a contractual document. This led to his making contradictory findings: that Turnquest initialled the order ... on behalf of Respondent as well as Plaintiff and later that he was acting for Respondent and not Plaintiff. ... [T]hey were simply not an issue before the judge.”

“Judge Lyons did consider the issue of delay, but he did so ... exclusively on behalf of Mr. Walker. He referred to Mr. Walker’s bankruptcy and to his having taken the ‘reasonable step’ of approaching the Florida court for a stay of the sale order ... He concluded that Mr. Walker’s delay in coming to his court was ‘explainable’.”

Respondent lodged separate appeals against Orders (6) and (7). The Court of Appeal allowed both appeals.

“We pause here to comment briefly on these grounds in the context of Order 31 which gives the court an unqualified power to order a sale of land. Petitioners had retained Collie to represent both Petitioners. He entered an appearance on behalf of both. His instruction was to agree on a sale of the property. He now says he had no specific instruction from Mrs. Walker to accept a sale to the intervener with whom he had no dealings. As Order 31 makes clear, there is no need for there to be a contract of sale or a consent by the owners to a sale.”

“Once a buyer has been identified who is prepared to pay the best price to the satisfaction of the Court, the procedural provisions for the sale can be invoked. Collie’s attempt to resile from the terms of the order which he consented to, and in which the purchaser’s name is mentioned, cannot be a ground for setting the order aside. Relying on Collie’s representation that the offer of the Respondent was acceptable to Petitioners; the Court was satisfied that the price offered was the best one in the circumstances, so as to properly make an order of sale disposing of Mr. Walker’s beneficial half interest, which must necessarily involve a sale of the property.”

“Furthermore, the purchaser had partly conformed or complied with the order by paying over the purchase price to the persons appointed to conduct the judicial sale. Liberty to apply could not, in our view, give the Court a jurisdiction to set aside the order in the circumstances of this case when all the requirements of a judicial sale had been satisfied.”

“ ... But in concluding that all the requirements of a judicial sale had been complied with, the Court of Appeal was paying insufficient regard to the judge’s findings of fact ...and other credible evidence. Collie had gone beyond his instructions from Mr. Walker, and had no instructions whatsoever from Mrs. Walker. The sale had not been completed either by a conveyance or by payment of half of the net proceeds to Mrs. Walker. The $402,000 must have been held by Turnquest as Respondent’s attorney since he apparently repaid most of it to her without the authority of the court. Turnquest was plainly not an appropriate person to have conduct of the sale. On the occasion of Order (3), Respondent had, through Turnquest, given an undertaking not to proceed with the sale, and that undertaking remained in force until it was overtaken by Order (5).”

The Court of Appeal pointed out that, in making Order (7), Judge Lyons had been wrong in supposing that, in the proceedings 1355 of 1990, Plaintiff needed leave to serve process out of the jurisdiction. “At the material time, Mr. Walker had a residence in the Bahamas and voluntarily submitted to the jurisdiction. The judge fell into error in setting aside a regularly obtained summary judgment to which Plaintiff was entitled on the pleadings.”

Counsel agreed that there are two main issues in the appeal to the Board relating to Order (6): (1) did the judge have jurisdiction to make the order? and (2) if so, was he right to exercise his discretion in favour of Mrs. Walker? The first issue raises, apart from common law and procedural issues as to jurisdiction, a point of statutory construction on Section 57 of the Conveyancing and Law of Property Act.

“Mr. Dingemans QC (for Respondent) contended that there was no jurisdiction to set aside Order (6). He pointed out that neither Petitioner had appealed against Orders (1), (2) or (4). In reply, Mr. Knox contended that an appeal would have been inappropriate in a case like this.”

Order (1) was based on consent. ... “An order made by consent can be set aside at common law if sufficient grounds are shown, subject to the well‑known principles which always constrain the court in granting discretionary relief.”

“Their Lordships are satisfied that Judge Lyons did have jurisdiction, at common law, to set aside the first order on the ground of a mistake, ... as to Collie’s authority to act for Mrs. Walker. None of [the precedents] permits a first‑instance judge to set aside a final order, ... without some special reason, usually involving a material change of circumstances. But a change of circumstances is not, in this context, to be interpreted narrowly. It can include the discovery of new information, even if that information was, in a sense, always available.”

“As a separate and ... conclusive point, Mr. Dingemans relied on Section 57 of the Conveyancing and Law of Property Act . ...The judge’s omission to refer to it was probably because he analysed the order for sale as essentially a contract which happened to be embodied in an order. ...”

“Section 57(1) is in the following terms: ‘An order of the Court under any statutory or other jurisdiction shall not, as against a purchaser, be invalidated on the ground of want of jurisdiction, or of want of any concurrence, consent, notice, or service, whether the purchaser has notice of any such want or not.’”

“In all the English authorities, ... there was unquestionably a contract, sometimes completed by conveyance, sometimes still uncompleted (hence the reference to .. intending purchaser). Where the contract remained uncompleted , the purchaser was questioning whether the statutory provisions were wide enough to ensure that he would get a good title ...”

If, on the other hand, the contract had been completed, the purchaser or his successor in title would be relying on the statutory provisions to defend his title. Whether they did provide protection depended, in short, on whether the alleged defect in title was in the court order (or the way in which it was obtained) on the one hand or was anterior to the order, on the other hand. But in either case there was no doubt about the party’s status as a purchaser.

“In the present case, there is real doubt about Respondent’s status as a purchaser. It is the central issue in the case. Respondent is seeking to use Section 57 to confer on herself the status of purchaser or intending purchaser which is the precondition of obtaining protection under Section 57. That is a circular and question‑begging process of reasoning which their Lordships do not accept.”

“Mr. Dingemans’ strongest resistance to the appeal was on the issue of discretion. He relied on seven [overlapping] points ...: [1] the need for finality in litigation; [2] the submission that Collie had ostensible authority to agree to a compromise on behalf of Mrs. Walker; [3] the Respondent’s failure to appeal against any of the Orders (1), (2) or (4); [4] Mrs. Walker’s delay in making her application to set aside Orders (1) and (2); [5] the prejudice to third‑party rights (those of Respondent), [6] the part‑performance of the transaction by Respondent and [7] the absence of notice to Respondent of the alleged deficiencies in the sale order.”

“The need for finality in litigation is an important general principle. [Cite]. But it has to be balanced against the need to remedy injustice wherever possible. The need for finality means that the court starts with a disinclination to reopen concluded transactions. But it cannot by itself be decisive. There is a balancing exercise to be performed.”

“Once the Court of Appeal recognised that the transaction was essentially a judicial sale, albeit under a consent order, the crucial questions were whether a mistake had been made, and whether (as a matter of discretion) the mistake should be put right. An attorney’s consent given with ostensible but not actual authority would still be a mistaken consent, although one which the court would be less ready to correct at the expense of third‑party rights.”

“The failure of Petitioners to appeal Orders (1) and (2) was excusable, since (as the judge found) they knew nothing about them until long after the time for appealing had expired. In any event, it is doubtful whether an appeal against those orders would have been more appropriate than the course that Mrs. Walker eventually took. Order (4) is more problematical, because by then Petitioners did know the facts but were still apparently represented ... by Collie.”

“As to delay, their Lordships have already noted that in dealing with the issue of delay the judge focussed on Mr. Walker to the exclusion of his wife. That was an error ... His share was subject to the charging order but hers was not. He was made bankrupt but she was not. He instructed Collie ... but she never actually instructed him. The application made by Mr. Lockhart on June 15, 2004 was her application, and it is Mrs. Walker who had the burden of explaining and excusing her delay. ... [T]here is still a period of eleven months’ delay to be accounted for.”

“The only explanation given by Mrs. Walker was in her affidavit sworn on June 15, 2004. Almost the whole of that affidavit is concerned with emphasising the absence of instructions and communications between herself and Collie. By contrast she said little about the period after she learned about the sale order. ... It would be remarkable if her husband had not kept her informed about his financial problems, including his bankruptcy, and the steps which his trustee in bankruptcy was taking in the Bahamas. Mr. Rotella, who was acting as Mr. Walkers U.S. attorney, was also acting for Mrs. Walker. But in her affidavit she gave no explanation for her inactivity after July 2003.”

“Mrs. Walker seems to have done nothing for eight months after learning the facts to stop Collie from continuing to claim to act for her. The most likely inference is that Mrs. Walker stood back, from July 2003 until March 2004, to see whether the trustee in bankruptcy would be successful in her application, and that when it failed, Mrs. Walker decided to launch her own application through Mr Lockhart.” 75 “... [I]t was for Mrs. Walker to satisfy the court, by a full and detailed explanation, that it should show exceptional indulgence to her. Her affidavit did not do that.”

“Mr. Dingemans’ last three points all concern aspects of prejudice to Respondent’s third‑party rights. They are another factor to be taken into account, .... Respondent was not cross‑examined and the judge’s findings about Mr. Turnquest acting for Respondent (rather than Mrs. Cole) are not supported by either side. It would not be right for their Lordships to draw any serious adverse inferences against Respondent.”

“Nevertheless it seems likely that [Respondent] as an experienced business woman, must have realised from an early stage that this was an unconventional transaction. She was on notice from July 21, 2003 at the latest, and probably a good deal sooner, that it was being seriously challenged. On or before July 11, 2003, she had paid $402,000 to Turnquest, but ... he must have received it as her attorney, and he has since, it seems, repaid most of it. Nevertheless Respondent has certainly suffered some prejudice by the disruption of her financial affairs during this protracted litigation.”

“The judge considered the issue of delay but his analysis was flawed because he concentrated on Mr. Walker. Moreover, he did not pay sufficient regard to the prejudice to [Respondent]. He misdirected himself in exercising his discretion. In their Lordships’ opinion, Mrs. Walker, as a litigant asking for an extraordinary exercise of discretion in her favour, failed to act sufficiently promptly and failed to provide the court with a full and frank explanation of her delay. On those grounds the judge should have declined to make [Order (6)] and the Court of Appeal were right to set it aside (although their Lordships do not concur in all the Court of Appeal’s reasons).” The Court of Appeal was also right, for the reasons which it gave, in setting aside the seventh order.

“The judicial sale to [Respondent ] has still to be completed. Even at this late stage it may be appropriate for a wholly independent attorney to be appointed to have conduct of the sale and see it through to completion. That course may be particularly desirable if there is to be yet more litigation as to the effect on the charging order of the Florida orders of April 12, 2005 and November 29, 2007. Their Lordships express no opinion whatever on that matter. For these reasons, their Lordships will humbly advise Her Majesty that both appeals should be dismissed.” [¶¶ 41‑80].

Citation: Walker v. Lundborg, 2008 WL 576820 (Privy Council No. 79, 2008).

HABEAS CORPUS

U.S. Supreme Court holds, 5 to 4, that alien Guantanamo petitioners are entitled to seek habeas corpus; that Detainee Treatment Act of 2005 (DTA), Section 1005(e) review procedures are inadequate substitute for habeas corpus; and that these petitioners need not exhaust review procedures in Court of Appeals before proceeding with their habeas actions in District Court

The Petitioners in the following case are aliens detained at the Guantanamo Bay prison camp who have been designated “enemy combatants” by the Combatant Status Review Tribunals (CSRTs). They had been apprehended in Afghanistan, Bosnia, Gambia, and at other foreign locations. With the “Authorization for Use of Military Force” (AUMF), Congress empowered the President “to use all necessary and appropriate force against those ... [who] planned, authorized, committed, or aided the terrorist attacks ... on September 11, 2001.”

The Petitioners denied any involvement in the terrorist network that carried out the attacks, and in 2002 sought writs of habeas corpus in federal district court in the District of Columbia. The district court dismissed because Guantanamo is outside of the court’s territorial jurisdiction. The U.S. Court of Appeals for the District of Columbia Circuit affirmed, but the U.S. Supreme Court reversed because 28 U.S.C. Section 2241 extended statutory habeas jurisdiction to Guantanamo. Rasul v. Bush, 542 U.S. 466, 473 (2004).

While the Petitioners’ appeals were pending, Congress passed the Detainee Treatment Act of 2005 (DTA), Section 1005(e); it amended Section 2241 to give the U.S. Court of Appeals for the District of Columbia Circuit exclusive jurisdiction to review CSRT decisions. The Supreme Court held his provision inapplicable to cases (like the present one) pending when the DTA was enacted. Hamdan v. Rumsfeld, 548 U.S. 557, 576‑577 (2006). Congress then passed the Military Commissions Act of 2006 (MCA), whose Section 7(a) amended Section 2241(e)(1) to deny jurisdiction for habeas petitions that were pending at the time of its enactment. Consequently, the District of Columbia Circuit held that it lacked jurisdiction to hear the Petitioners’ cases. Boumediene v. Bush, 476 F.3d 981 (D.C. 2007). Petitions sought certiorari, which the U.S. Supreme Court granted.

The Supreme Court reverses and remands. Justice Kennedy delivered the majority opinion of the Court, joined by Justices Stevens, Souter, Ginsburg and Breyer. Chief Justice Roberts, joined by Justices Scalia, Thomas, and Alito filed a dissent. Justice Scalia filed a dissent in which Chief Justice Roberts and Justices Thomas and Alito joined.

The majority holds that: (1) if MCA Section 7(a) is valid, the Petitioners’ cases must be dismissed. (2) However, Petitioners have the constitutional privilege of habeas corpus, which is not abridged by their status as enemy combatants or their presence in Guantanamo. The Suspension Clause (U.S. Const., Art. 1, Section 9, cl. 2) provides: “The Privilege of the Writ of Habeas Corpus shall not be suspended, unless when in Cases of Rebellion or Invasion the public Safety may require it.” This clause has full effect in Guantanamo. The Court rejects the Government’s argument that Petitioners have no habeas rights because Cuba maintains sovereignty over Guantanamo, not the U.S. (3) The DTA’s procedures for reviewing the detainees’ status are not a sufficient substitute for habeas corpus, MCA Section 7(a) causes its unconstitutional suspension. (4) There may be substitutes for habeas corpus, but they would need to provide a meaningful opportunity to show that the law is erroneously applied. Also, the court must have the ability to correct the errors, consider the Government’s evidence as well as exculpatory evidence. (5) Petitioners have met their burden of showing that the DTA review process is an inadequate substitute for habeas corpus. Among other things, there are no provisions to challenge the President’s AUMF authority to detain the Petitioners indefinitely; to contest the CSRT’s findings of fact, or to supplement the record upon review with exculpatory evidence. MCA Section 7 thus suspends habeas corpus in an unconstitutional manner. (6) There is no jurisdictional bar to the District Court’s review of Petitioners’ claims.

As to the issue of whether the Petitioners are barred from habeas corpus relief, by virtue of their designation as “enemy combatants” or because of their location in Guantanamo, the Court first reviews the history of the writ. Over time, Congress has consistently acted to preserve habeas corpus. In fact, Congress more often than not acted to expand the reach of habeas corpus and to expedite the resolution of prisoners’ claims.

Turning to the DTA, the Court points out its deficiencies. “Under the DTA the Court of Appeals has the power to review CSRT determinations by assessing the legality of standards and procedures. This implies the power to inquire into what happened at the CSRT hearing and, perhaps, to remedy certain deficiencies in that proceeding. But should the Court of Appeals determine that the CSRT followed appropriate and lawful standards and procedures, it will have reached the limits of its jurisdiction. There is no language in the DTA that can be construed to allow the Court of Appeals to admit and consider newly discovered evidence that could not have been made part of the CSRT record because it was unavailable to either the Government or the detainee when the CSRT made its findings. This evidence, however, may be critical to the detainee’s argument that he is not an enemy combatant and there is no cause to detain him.” [...]

“By foreclosing consideration of evidence not presented or reasonably available to the detainee at the CSRT proceedings, the DTA disadvantages the detainee by limiting the scope of collateral review to a record that may not be accurate or complete. In other contexts, e.g., in post‑trial habeas cases where the prisoner already has had a full and fair opportunity to develop the factual predicate of his claims, similar limitations on the scope of habeas review may be appropriate. ... In this context, however, where the underlying detention proceedings lack the necessary adversarial character, the detainee cannot be held responsible for all deficiencies in the record.”

“The Government does not make the alternative argument that the DTA allows for the introduction of previously unavailable exculpatory evidence on appeal. It does point out, however, that if a detainee obtains such evidence, he can request that the Deputy Secretary of Defense convene a new CSRT. ... Whatever the merits of this procedure, it is an insufficient replacement for the factual review these detainees are entitled to receive through habeas corpus. The Deputy Secretary’s determination whether to initiate new proceedings is wholly a discretionary one. See Dept. of Defense, Office for the Administrative Review of the Detention of Enemy Combatants, Instruction 5421.1, Procedure for Review of ‘New Evidence’ Relating to Enemy Combatant (EC) Status ¶ 5(d) (May 7, 2007) (Instruction 5421.1) (‘The decision to convene a CSRT to reconsider the basis of the detainee’s [enemy combatant] status in light of ‘new evidence’ is a matter vested in the unreviewable discretion of the [Deputy Secretary of Defense]’).” [Slip op. 26].

Furthermore, the jurisdiction of the Court of Appeals to review is limited to a final decision of the CSRT that the Petitioner is properly detained as an enemy combatant.

The Court also reviews any prudential barriers to habeas corpus under these circumstances. A prominent issue involves the long delays in the proceedings. “The cases before us, however, do not involve detainees who have been held for a short period of time while awaiting their CSRT determinations. Were that the case, or were it probable that the Court of Appeals could complete a prompt review of their applications, the case for requiring temporary abstention or exhaustion of alternative remedies would be much stronger. These qualifications no longer pertain here. In some of these cases, six years have elapsed without the judicial oversight that habeas corpus or an adequate substitute demands. And there has been no showing that the Executive faces such onerous burdens that it cannot respond to habeas corpus actions.”

“To require these detainees to complete DTA review before proceeding with their habeas corpus actions would be to require additional months, if not years, of delay. The first DTA review applications were filed over a year ago, but no decisions on the merits have been issued. While some delay in fashioning new procedures is unavoidable, the costs of delay can no longer be borne by those who are held in custody. The detainees in these cases are entitled to a prompt habeas corpus hearing.” [Slip op. 27‑28]

The majority also points to the limitations of its rulings. “Our decision today holds only that the petitioners before us are entitled to seek the writ; that the DTA review procedures are an inadequate substitute for habeas corpus; and that the petitioners in these cases need not exhaust the review procedures in the Court of Appeals before proceeding with their habeas actions in the District Court. The only law we identify as unconstitutional is MCA Section 7, 28 U.S.C.A. Section 2241(e) (Supp. 2007). Accordingly, both the DTA and the CSRT process remain intact.”

“Our holding with regard to exhaustion should not be read to imply that a habeas court should intervene the moment an enemy combatant steps foot in a territory where the Writ runs. The Executive is entitled to a reasonable period of time to determine a detainee’s status before a court entertains that detainee’s habeas corpus petition. The CSRT process is the mechanism Congress and the President set up to deal with these issues. Except in cases of undue delay, federal courts should refrain from entertaining an enemy combatant’s habeas corpus petition at least until after the Department, acting via the CSRT, has had a chance to review his status.” [Slip op. 28]

“It is in fact the very lapse of four years from the time Rasul put everyone on notice that habeas process was available to Guantanamo prisoners, and the lapse of six years since some of these prisoners were captured and incarcerated, that stand at odds with the repeated suggestions of the dissenters that these cases should be seen as a judicial victory in a contest for power between the Court and the political branches. [See dissents of Roberts, C. J.; post, and Scalia, J.). The several answers to the charge of triumphalism might start with a basic fact of Anglo‑American constitutional history: that the power, first of the Crown and now of the Executive Branch of the United States, is necessarily limited by habeas corpus jurisdiction to enquire into the legality of executive detention.”

“And one could explain that in this Court’s exercise of responsibility to preserve habeas corpus something much more significant is involved than pulling and hauling between the judicial and political branches. Instead, though, it is enough to repeat that some of these petitioners have spent six years behind bars. After six years of sustained executive detentions in Guantanamo, subject to habeas jurisdiction but without any actual habeas scrutiny, today’s decision is no judicial victory, but an act of perseverance in trying to make habeas review, and the obligation of the courts to provide it, mean something of value both to prisoners and to the Nation.” [Slip op. 48].

The Court thus remands to the Court of Appeals, with instructions to remand to the District Court.

The dissent of Chief Justice Roberts argues that the majority is really attempting to review the

federal policy regarding enemy combatants. The current system created by the political branches adequately protects any rights that the aliens captured abroad and designated “enemy combatants” may have. Thus, their petitions should be dismissed.

“[T]he political branches created a two‑part, collateral review procedure for testing the legality of the prisoners’ detention: It begins with a hearing before a Combatant Status Review Tribunal (CSRT) followed by review in the D.C. Circuit. As part of that review, Congress authorized the D.C. Circuit to decide whether the CSRT proceedings are consistent with ‘the Constitution and laws of the United States.’ DTA Section 1005(e)(2)( c), 119 Stat. 2742. No petitioner, however, has invoked the D.C. Circuit review the statute specifies. See 476 F. 3d 981, 994, and n. 16 (D.C. Cir. 2007) ....”

“As a consequence, that court has had no occasion to decide whether the CSRT hearings, followed by review in the Court of Appeals, vindicate whatever constitutional and statutory rights petitioners may possess. See 476 F. 3d, at 994, and n. 16. Remarkably, this Court does not require petitioners to exhaust their remedies under the statute; it does not wait to see whether those remedies will prove sufficient to protect petitioners’ rights.” [Slip op. 31]. The majority’s failure to require exhaustion of remedies violates the standard procedure for Supreme Court review of constitutional questions.

Furthermore, the CSRT process is more generous than the protections traditionally afforded prisoners of war. “Prisoners of war are not permitted access to classified information, and neither are they permitted access to counsel, another supposed failing of the CSRT process. And yet the Guantanamo detainees are hardly denied all legal assistance. They are provided a ‘Personal Representative’ who, as previously noted, may access classified information, help the detainee arrange for witnesses, assist the detainee’s preparation of his case, and even aid the detainee in presenting his evidence to the tribunal. See Implementation Memo, supra, at 161. The provision for a personal representative on this order is one of several ways in which the CSRT procedures are more generous than those provided prisoners of war under Army Regulation 190‑8.”

“Keep in mind that all this is just at the CSRT stage. Detainees receive additional process before the D.C. Circuit, including full access to appellate counsel and the right to challenge the factual and legal bases of their detentions. DTA Section 1005(e)(2)( c) empowers the Court of Appeals to determine not only whether the CSRT observed the ‘procedures specified by the Secretary of Defense,’ but also ‘whether the use of such standards and procedures ... is consistent with the Constitution and laws of the United States.’ 119 Stat. 2742.”

“These provisions permit detainees to dispute the sufficiency of the evidence against them. They allow detainees to challenge a CSRT panel’s interpretation of any relevant law, and even the constitutionality of the CSRT proceedings themselves. This includes, as the Solicitor General acknowledges, the ability to dispute the Government’s right to detain alleged combatants in the first place, and to dispute the Government’s definition of ‘enemy combatant.’ [Cite]. All this before an Article III court—plainly a neutral decisionmaker.”

“All told, the DTA provides the prisoners held at Guantanamo Bay adequate opportunity to contest the bases of their detentions, which is all habeas corpus need allow. The DTA provides more opportunity and more process, in fact, than that afforded prisoners of war or any other alleged enemy combatants in history.” [Slip op. 36].

Justice Scalia’s dissent argues that habeas corpus simply does not apply to aliens abroad. The text and history of the Suspension Clause provides no basis for the Court’s jurisdiction. In fact, it burdens military commanders with having to show in a civil forum why each and every enemy prisoner should not be released. He predicts that the U.S. will one day regret today’s opinion.

Citation: Boumediene v. Bush,128 S. Ct. 2229, 78 U.S.L.W. 4391, 4408 (U.S. June 12, 2008).

Russian and U.S. officials sign agreement to advance peaceful uses of nuclear energy.

On May 6, the United States Ambassador to Russia and the Russian Director of the State Corporation for Atomic Energy (Rosatom) signed an Agreement between the two nations to further their mutual Cooperation in the Field of Peaceful Uses of Nuclear Energy (a.k.a. 123 Agreement). When it enters into force, this Agreement will set up the needed legal basis for U.S.‑Russian cooperation with respect to using nuclear energy for peaceful purposes. Both nations will benefit from the arrangement. It will be a good thing for U.S. industry because it contemplates letting U.S. and Russian companies team up in carrying out joint nuclear ventures. It will also allow U.S. industry to sell nuclear materials, reactors and major reactor components to Russia on a commercial basis. Finally, it will buttress U.S.‑Russian nonproliferation cooperation under bilateral programs and other initiatives in the civil uses of nuclear energy. For instance, it carries further the Declaration on Nuclear Energy and Non proliferation of July 3, 2007 and the Global Nuclear Energy Partnership. President Bush will probably submit the Agreement for Congressional consideration in the near future. Citation: Press Statement #2008/358, Sean McCormack, Spokesman, U.S. Department of State, Washington, D.C., Tuesday, May 6, 2008.

Macedonia and United States have signed declaration on strategic planning and cooperation. On May 7, the U.S. Secretary of State and the Foreign Minister of the Republic of Macedonia signed a joint Declaration of Strategic Partnership and Cooperation. It affirms the purpose of our two governments to further expand and deepen the partnership between our two countries based upon our common goals, interests, and values. The Declaration seeks to enhance our relationship and to broaden cooperation across the range of our bilateral relations, including in the areas of security, people‑to‑people ties, and commerce. With our troops serving side‑by‑side in Iraq and Afghanistan, the Declaration highlights the strong existing U.S.‑Macedonian partnership in the fight against global terrorism and in furthering international stability. The two nations will build on this strategic partnership by intensifying our high‑level civilian and military contacts, by increasing joint training and by exercising opportunities to enhance the inter‑operability of our military forces. It emphasizes the United States’ longstanding support for Macedonia’s continued security, stability and economic development on the path to full Euro‑Atlantic integration. In this respect, both countries look forward to Macedonia joining NATO as soon as possible. Citation: Media Note #2008/389, Office of the Spokesman, U.S. Department of State, Washington, D.C., Wednesday, May 7, 2008, at 15:02:37 EDT.

Saudi Arabia and U.S. sign MOU on cooperation in field of civil nuclear energy. On May 15, the U.S. Secretary of State and the Saudi Arabia Foreign Minister signed a Memorandum of Understanding (MOU) on Civil Nuclear Energy Cooperation. The U.S. and the Kingdom of Saudi Arabia (KSA) will set up a comprehensive framework for working together to develop environmentally sustainable, safe, and secure civilian nuclear energy through a series of complementary agreements. Both of our countries face growing energy needs and we seek to address them in a responsible manner that contributes to reducing the effects of greenhouse gases on the global climate. The U.S. will assist the KSA to develop civilian nuclear energy for use in medicine, industry, and power generation. It will also help to improve both human and infrastructure resources in accordance with evolving International Atomic Energy Agency (AEA) guidance and standards. In direct contrast to the actions of Iran, the KSA has pledged to rely on international markets for nuclear fuel and not to pursue sensitive nuclear technologies. Moreover, the KSA became the 71st nation to join the Global Initiative to Combat Nuclear Terrorism (GICNT). As a partner in this multilateral enterprise, the KSA will cooperate with partner nations to address all aspects of the nuclear terrorism threat, including deterrence, denial of safe havens, detection, material confiscation, and response. The KSA also presented the U.S. with a diplomatic note endorsing the Proliferation Security Initiative (PSI), joining more than 85 states already taking part in the PSI. It responds to the growing challenge posed by the proliferation of weapons of mass destruction (WMD), their delivery vehicles, and related materials worldwide. PSI members agree to undertake measures to interdict transfers of WMD‑related items, to exchange relevant information, and to strengthen national legal authorities. Citation: Media Note 2008/395, Office of the Spokesman, U.S. Department of State, Washington, D.C., released Friday, May 16, 2008.

U.S. certifies forty nations as not endangering sea turtles. On May 1, the U.S. Department of State (DOS) certified 40 nations and one economy as meeting the requirements set by Section 609 of P. L. 101‑162 for continued importation of shrimp into the U.S. Section 609 prohibits importation of shrimp and products of shrimp harvested in a manner that may adversely affect sea turtle species. Such certifications are based in part on verification visits made to countries by teams of experts from the DOS and the U.S. National Marine Fisheries Service. The chief component of the U.S. sea turtle conservation program is a requirement that commercial shrimp boats use sea turtle excluder devices (TEDs) to prevent the accidental drowning of sea turtles in shrimp trawls. The 16 nations meeting this standard are: Belize, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Guyana, Honduras, Madagascar, Mexico, Nicaragua, Nigeria, Pakistan, Panama, Suriname, and Venezuela. Twenty‑four nations and one economy were certified as having fishing environments that do not pose a danger to sea turtles. Of these, 8 nations and 1 economy—the Bahamas, China, the Dominican Republic, Fiji, Hong Kong, Jamaica, Oman, Peru and Sri Lanka—harvest shrimp using manual rather than mechanical means to retrieve nets, or use other fishing methods not harmful to sea turtles. In general, the DOS will ban importation of shrimp from other nations [1] unless harvested by aquaculture methodology (fish‑farming), [2] unless in cold‑water regions where sea turtles are not likely found, or [3] by specialized fishing techniques that do not threaten sea turtles. Citation: Media Note #2008/350, Office of Spokesman, U.S. Department of State, Washington, D.C. released May 2, 2008.

Australia’s highest court affirms drug conviction of U.S. Citizen. Following a trial by jury in Victoria, Australia, the court convicted the Defendant, Steven Adams, a U.S. Citizen, of possessing, on January 9, 2004, prohibited imports contrary to The Customs Act of 1901. The substance in question was a mixture that contained 8.916 kg. of MDMA, commonly known as “ecstasy.” It is a synthetic amphetamine analog. Australian authorities had intercepted certain containers shipped to Defendant from overseas. The quantity of MDMA in the Defendant’s possession substantially exceeded the amount required for a “commercial” quantity. The judge sentenced Defendant to imprisonment for nine years from the date of sentence and made him eligible for parole after seven years. The Defendant failed to persuade the Court of Appeal of Victoria, or the Australian High Court that the court should re‑sentence him on the basis that MDMA is less harmful to users and to society than heroin. The High Court dismisses his appeal. “In relation to some of these matters, scientific knowledge changes, and opinions differ, over time. Generalisations which seek to differentiate between the evils of the illegal trade in heroin and in MDMA are to be approached with caution, and in the present case are not sustained by evidence, or material of which judicial notice can be taken. The Defendant has failed to demonstrate either a legal or a factual foundation for the contention that he should have been sentenced on the basis that MDMA is less harmful than heroin.” [¶¶ 11‑12]. Citation: Adams v. The Queen, [2008] H.C.A. 15; 2008 WL 1800095 (High Court 2008).