Jurisdictional Immunities v Grave Crimes: Reflections on New Developments from Ukraine

On 14 April 2022, the Supreme Court of Ukraine issued a judgment in which it accepted a claim brought against Russia by the wife of a deceased Ukrainian soldier for moral damage caused to her and their minor children by its unlawful actions in Ukraine in 2014. That decision led to a series of similar judgments – two decisions of 18 May 2022 (1, 2) as well as of 08 and 22 June 2022, with the former of the last two expanding the reasoning of the Supreme Court. In all these cases, the Ukrainian Supreme Court departed from the rule of customary international law recognized by the International Court of Justice (ICJ) in the Jurisdictional Immunities case (Germany v Italy, Greece intervening), and its equivalent in Article 79 of Ukraine’s Law on Private International Law. In that judgment of 2012, the ICJ held that the rule by which states are immune from the jurisdiction of foreign domestic courts, and from enforcement, remains valid even where the actions in question are committed by armed forces in the context of an armed conflict. For analysis of the resubmission to the ICJ of the dispute between Germany and Italy, see this previous post.

This post will argue that although the decisions of the Ukrainian Supreme Court might seem to be progressive, from a practical perspective it could turn out to be an obstacle rather than a tool for fair compensation of numerous victims of aggression against Ukraine.

In its decisions, the Supreme Court acknowledged that Ukraine’s Law on Private International Law establishes the jurisdictional immunity of a foreign state unless the consent of the competent authorities of that state is obtained but decided that Russia’s sovereign immunity should be set aside. In the decisions of 18 May 2022, it supplied four major arguments to justify its position (the first decision of the series relied on a mix of the second and fourth of these arguments).

First, Russia’s sovereign immunity would violate the complainants’ right to effective judicial protection guaranteed by Article 6(1) of the European Convention on Human Rights and Article 55 of the Constitution of Ukraine. The Supreme Court referred to the legal position of the European Court of Human Rights (ECtHR) expressed, inter alia, in Oleynikov v Russia that “the grant of immunity to a State in civil proceedings pursues the legitimate aim of complying with international law to promote comity and good relations between States through the respect of another State’s sovereignty” [para 60] and interpreted that principle as allowing the domestic court to deny sovereign immunity where good relations between the nations had been ruptured. In addition, the Supreme Court took into account that (i) Russia consistently denied its international responsibility for aggression against Ukraine (for instance, when it failed to abide by the ICJ’s provisional measures order of 16 March 2022), (ii) a complainant could not reasonably be expected to win a case in the Russian courts for the protection of their rights and (iii) no mechanisms or international agreements for the compensation for damages were available between Ukraine and Russia.

Second, the Supreme Court relied on the territorial tort principle as enshrined in Article 11 of the European Immunities Convention and Article 12 of the United Nations Immunities Convention. When applying this exception, the Court established, inter alia, that the lawsuit dealt with redress for a moral injury inflicted on Ukrainian citizens, the injury had occurred in Ukraine, and the injury was caused by acts of Russian agents.

Third, according to the Ukrainian Supreme Court, the grant of sovereign immunity to Russia would violate the Council of Europe Convention on the Prevention of Terrorism and the International Convention for the Suppression of the Financing of Terrorism, in particular its Article 8.

Finally, the Supreme Court opined that acts of armed aggression in violation of sovereignty and territorial integrity of Ukraine in contravention of the UN Charter did not constitute acta juri imperii. In the decision of 14 April 2022, it explained that

“the essential condition for the respect of the sovereign immunity principle is the mutual recognition of sovereignty by States, which means that when Russia denies Ukraine’s sovereignty and wages the war of aggression against it, no obligation to respect and give way to the former’s sovereignty remains”.

The Supreme Court thus concluded that from the start of Russia’s aggression against Ukraine back in 2014 the former’s sovereign immunity was to be denied, and Ukrainian courts might entertain claims for damages against Russia without the need to request its consent for such proceedings.

It is undeniable that the gravity of Russia’s assault against Ukraine which brought about massive civilian deaths, destruction of entire cities and global economic repercussions influenced the ultimate judgement. Nevertheless, it is hard to ignore parallels with ICJ’s Jurisdictional Immunities ruling with respect to most pillars of the Supreme Court’s legal position. For instance, the ICJ mentioned several ECtHR applications which were found inadmissible with reference to the sovereign immunity principle (Kalogeropoulou and Others v. Greece and Germany; Grand Chamber judgements in McElhinney v. Ireland and Al-Adsani v. UK). The ICJ also could not find state practice to support the conclusion that “international law makes the entitlement of a State to immunity dependent upon the existence of effective alternative means of securing redress” [para 101]. As regards the application of the territorial tort principle and the qualification of acta juri imperii, the ICJ admitted that “State immunity for acta jure imperii continues to extend to civil proceedings for acts occasioning death, personal injury or damage to property committed by the armed forces and other organs of a State in the conduct of armed conflict, even if the relevant acts take place on the territory of the forum State” [paras 65, 77]. While the Supreme Court tried to justify its position based on the higher level of international law rule violated by Russia, the ICJ appears to have rejected this form of reasoning when it held that the rules of State immunity are not inconsistent with norms of jus cogens as the former are procedural in character and are confined to determining whether or not the courts of one State may exercise jurisdiction in respect of another State [para 93].

Even if one does not agree with the ICJ’s arguments, this does not mean that the Supreme Court’s decisions would serve the interests of justice the way it intended, and here is why.  

The war in Ukraine is, unfortunately, not over, and the number of victims of aggression of Russia and its allies is known only tentatively. The Ukrainian Government adopted a resolution listing 15 broad categories of losses caused by Russian aggression and instructing its subordinate authorities to develop methodologies for their assessment. The real scope of potential claims is hard to determine at this moment, but it is definitely in the order of billions. The Kyiv School of Economics within its dedicated project “Russia Will Pay” estimates economic losses at USD $113.5 billion (as of 22 August 2022). The bottom-line is that the amount of Russian assets available in Ukraine to satisfy all those claims is clearly insufficient. To enforce the sums claimed through foreign courts, complex cross-border litigation must be instituted, which would require additional efforts from victims in terms of time and money. Absent successful cross-border enforcement, the Russian money available in Ukraine and closely located jurisdictions would be distributed among those few who were first in line to win legal proceedings in Ukrainian courts and get a piece of the pie. This distribution seems arbitrary and thus unfair as well as most likely disadvantageous to those who may be affected by the war but not familiar with recent developments in the Supreme Court practice. Even among those who managed to start legal proceedings, compensation does not appear to be awarded in an orderly manner: as demonstrated below, the five cases were not decided in the order of initiation of proceedings, claimants were not allocated final compensation in the order of delivery of Supreme Court judgments, and the amounts of compensation is not fully aligned.  

Even if at some future point the Ukrainian Parliament would adopt a law to give effect to a mass compensation avenue or if such mass compensation were to become available through an international mechanism, victims whose cases had been successfully finalized in Ukrainian domestic courts would likely receive preferential treatment.

The practical difficulties in the court-ordered allocation of compensation among numerous victims of war were aptly explained in a seminal US district court opinion in Alice Burger-Fisher et al v. Degussa AG and Degussa Corporation: 

“Were the court to undertake to fashion appropriate reparations for the plaintiffs in the present case, it would lack any standards to apply. Concededly, the resources are lacking to provide full indemnification for the terrible wrongs which plaintiffs, the plaintiffs in related cases and those they seek to represent suffered at the hands of Nazi Germany and at the hands of the giants of German industry which played an integral part in the perpetration of those wrongs. Wrongs were suffered not only by the classes of persons represented in these proceedings, however, but also by many other classes of persons in many lands. They, too, had claims against German assets. By what conceivable standard could a single court arrive at a fair allocation of resources among all the deserving groups? By what practical means could a single court acquire the information needed to fashion such a standard? This was a task which the nations involved sought to perform as they negotiated the Potsdam Agreement, the Paris Agreement, the Restitution Agreement and the 2+4 Treaty. It would be presumptuous for this court to attempt to do a better job.”

The reality of post-war settlements where it is still acceptable to trump the principle of full compensation of damages to each individual victim is indeed acknowledged by the ICJ in the Germany v Italy, which also recognised the State’s right to use the received reparation for other needs [emphasis added]:

“… against the background of a century of practice in which almost every peace treaty or post‑war settlement has involved either a decision not to require the payment of reparations or the use of lump sum settlements and set‑offs, it is difficult to see that international law contains a rule requiring the payment of full compensation to each and every individual victim as a rule accepted by the international community of States as a whole as one from which no derogation is permitted [para 94] …

Where the State receiving funds as part of what was intended as a comprehensive settlement in the aftermath of an armed conflict has elected to use those funds to rebuild its national economy and infrastructure, rather than distributing them to individual victims amongst its nationals, it is difficult to see why the fact that those individuals had not received a share in the money should be a reason for entitling them to claim against the State that had transferred money to their State of nationality.” [para 102, emphasis added]

As if to confirm this position, the ICJ in its decision on war damages, in the Armed Activities on the Territory of the Congo (Democratic Republic of the Congo v. Uganda) Reparations Judgment (2022), found it appropriate “in cases involving a large group of victims who have suffered serious injury in situations of armed conflict” to order a “global sum” compensation.

When deciding to deny Russia’s sovereign immunity and opening the gate for numerous individual lawsuits, the Ukrainian Supreme Court should have accounted for these concerns and approached the issue of fairness more seriously. It should have acknowledged that where resources for compensation are mostly likely finite, it will not be possible to award individual sums without understanding the whole picture of the needs of others. While the sovereign immunity principle is a complicated, psychologically twisted principle of international law to explain to the general public, it may in the end be useful when dealing with war-related compensation on a massive scale.