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The Enforceability of Private Property and Contract Rights against a Successor State in International Law

By: Daniel Costelloe

When one state replaces another in sovereignty over territory, several legal issues arise. One pressing issue that has fallen into neglect in scholarship concerns the enforceability of certain private rights, specifically property and contract rights, against the successor state. These include, for example, state contracts, concessions, or land grants by the government. This article examines the conceptual bases that have been invoked to explain the survival of such rights against a successor state. Even if such rights survive as a matter of customary international law, none of these theories—acquired rights, subrogation, the continuity of the predecessor state’s legal system and/or its institutions, the territorialization of rights, equitable interests, or unjust enrichment— is individually capable of accounting in full for the enforceability of property or contract rights against a successor state. The successor state is, however, under an obligation to negotiate in good faith with the beneficiaries of certain preexisting rights. This might be the most clearcut duty that remains, underscoring the significance of negotiated solutions in state succession matters.

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