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13456868
Public international Law LW531

The Island of Palmas Case (U.S. v The Netherlands) – An Issue of

Territorial Sovereignty
Summary & Issues:
The U.S. maintained it formed part of the Philippines under Spanish discovery,
pursuant to the Treaty of Paris 1898 and the alleged principle of contiguity. The Netherlands
purported a counter-claim of continuous display of sovereignty via the Dutch East India
Company contracts. The relevant issues were;
1) Did the U.S. title claim of discovery prevail over the peaceful and continuous
display of Dutch sovereignty, and;
2) Could the principal of contiguity be founded in international law?

*3) A divergence of view concerning the necessity and admissibility of evidence arose between
the parties. This was a question of procedure for the Arbitrator to decide under Article V of the
Special Agreement.

Background:
The Island of Palmas (Miangas) is located between the southern-most point of the
Philippines and the northern-most point of Indonesia. It is an extremely small island, only
2.6km N-S and 1km E-W. The population was below 1,000 at the time of the case.
The dispute arose in January 1906 after Major-General Wood (also a governor of a
nearby island) of the U.S. Army encountered Dutch ships upon his approach to the island, thus
prompting a statement from the U.S. declaring the island of Palmas as part of the
“archipelago known as the Philippine Islands” pursuant to Article III of the Treaty of Paris
1898, and the subsequent initiation of diplomatic correspondence between the contentious
states. On January 23 1925, following an extended period of disagreement, the parties referred
the dispute of sovereignty to the Permanent Court of Arbitration where Max Huber was tasked
with the determination of which claim had been more firmly established.

Arguments:
The U.S. submissions supported a claim of sovereignty with;
a) Spanish discovery of the island and cession pursuant to the Treaty of Paris 1898. The
documents supplied to the arbitrator consist of translations from reports from the voyages of
a Spanish explorer, Garcia de Loaisa, who made reference to the island in October of 1526.
This was supported by the fact that the island appeared on maps as early as 1595. Following
their defeat, the Spanish signed the Treaty of Paris 1898 and relinquished to the
U.S. certain territories within a specified region, the Island of Palmas included.
b) Reference to the Treaty of Münster 1648, specifically Article V & VI, which seemingly
clarified the appointment of territories with regard to the Spanish conquest of islands
located in close proximity to that of Palmas, thus inferring indirect dominion.
c) The principal of contiguity, inferring that the title claim should revert to the U.S. in the
interest of geographical unity.

The Netherlands argued that Dutch sovereignty had been demonstrated as early as
1648, producing a series of contracts concluded by the East India Company – in 1677, 1697,
1720, 1758, 1828, 1885 & 1899 – with the native princes of the Sangihe Islands south of
Palmas, undoubtedly under Dutch suzerainty. In accordance with the contract of 1885,

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predating the Treaty of Paris 1898, the list of territories included in Dutch frontiers specified
the Island of Palmas. This listing was repeated in the contract of 1899, with both contracts
containing provisions excluding the native princes from dealings with foreign nationals and
the use of Dutch currency as legal tender.

Judgment:
Regarding the Spanish discovery of the island, the reports produced by the U.S.
displayed no evidence of possession or administration by Spain (e.g. planting of a flag), only
that the island was “seen”. This would make the title of discovery inchoate, under the most
liberal of interpretations. Following the prevailing view of international law at the time, an
inchoate title must be completed with an act displaying possession within a reasonable time
to successfully legitimise a title claim. The U.S. reliance on the Treaty of Münster 1648 was
also ill-founded. Upon investigation of its articles, it was found the treaty did not definitively
divide or appoint territories to one power or another. More importantly, the treaty refrained
from acknowledging the validity of a title by discovery.
It is evident that Spain could not confer rights upon the U.S. that she, herself, did not
possess. This was expressly recognised in communications between the U.S. Secretary of
State & Spanish Minister at Washington, dated April 7th 1900. It appeared that the cessionary
State never envisaged the compromise of territories that Spain had no legitimate title over,
even if within the boundaries detailed in the Treaty of Paris 1898.
Thus, it cannot be interpreted as disposing of the rights of independent third Powers.
Additionally, the principle of contiguity remains to be demonstrated as an existing
positive rule of international law. Despite its practicality under consensual circumstances,
international arbitral jurisprudence on disputes of sovereignty (e.g. Italy v Switzerland,
concerning the Alpe Craivarola) attributes little weight to the continuity of territory in favour
of the display of sovereignty.

Although the arbitrator found that the U.S. failed to establish the effective display of
sovereignty at anytime, it was still necessary to whether the contention of the Netherlands
was sufficient. In the opinion of the arbitrator, the Netherlands were indeed successful in
establishing the Island of Palmas as forming a part of the Sangihe Islands, which were also
proven to be under Dutch suzerainty through the East india Co. contracts. The ability of the
East India Company to act under international law was questioned by the U.S., however
Article V of the Treaty of Münster 1648 expressly recognised the chartered company’s ability
to create situations recognised under international law. The contracts were also
accompanied by certification from competent officials of the Dutch government, solidifying
their authenticity. Furthermore, actions characteristic of demonstrating state authority were
considered to have taken place from 1700 to 1898. This was deemed to be, in effect, a
continuous and peaceful display of sovereignty.

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Under the decision, three precedents for resolving island territorial disputes were decided:

 Title based on contiguity has no standing in international law;

 Title by discovery is only an inchoate title;
 If another sovereign begins to exercise continuous and actual sovereignty openly and
publicly and with good title, but the discoverer does not contest the claim, the claim by
the sovereign that exercises authority is then greater than a title based on mere
discovery.

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