7 September 1939

GENERAL ACT FOR THE PACIFIC SETTLEMENT OF INTERNATIONAL DISPUTES

1. In view of the consideration being given by the Commonwealth
Government to the question what action (if any) should be taken in
relation to the Optional Clause of the Statute of the Permanent
Court of International justice, the time would seem to be
opportune to reconsider also the position of the Commonwealth in
relation to the General Act for Pacific Settlement of
International Disputes.

2. By the Pact of Paris which was signed in 1928, the Members of
the League and certain other States had already renounced war as a
means of solution of international disputes and the principle of
pacific settlement had been affirmed. The establishment of the
Permanent Court had met the need for adequate machinery to
effectuate this principle in practice so far as legal disputes
were concerned, but no general procedure was available for the
purpose of settling disputes other than those specifically
provided for in the Statute of the Court. To meet this need and to
obviate the necessity for the conclusion of a number of bilateral
arrangements, the General Act for Pacific Settlement of
International Disputes was drafted in 1931. This Act made
provision for the settlement of disputes of every kind between two
or more parties to the Act. It was acceded to by the United
Kingdom and the Dominions (other than South Africa) subject to
certain conditions.

3. Following upon the developments in connection with Article 16
of the Covenant (The Sanctions Provisions) which have been
referred to in connection with the Optional Clause, the
Governments of the United Kingdom, New Zealand, India, and France
denounced the General Act in February, 1939, following their
denunciations by fresh accessions for a further period subject to
a reservation excluding from the Act any disputes arising out of
events occurring during war. At the same time the Commonwealth
Government considered whether similar action should be taken by
it.

4. On 13th February, 1939, the Commonwealth Government decided to
reaffirm its decision taken a few days previously, that it was
inexpedient at that juncture to denounce the General Act. [1] The
grounds for this decision were that the political objections to
denunciation were of paramount importance, in that the
consequences of the proposal to denounce might result in a charge
of subterfuge, that the Commonwealth Government was seriously
considering war and abandoning a well established part of the
international machinery for the peaceful settlement of disputes.

5. It is clear in present circumstances that the reasons
considered adequate by the Commonwealth Government in February
1939 for its decision to continue bound by the General Act no
longer hold good. Not only has the machinery of the Covenant and
Pact of Paris supplemented by the Optional Clause and the General
Act completely failed to avert the present crisis, but various
Members of the League have already indicated that they will remain
neutral in the existing war. For the reasons set out in the
memorandum concerning the Optional Clause, it is suggested that
action be taken as soon as possible to denounce the General Act in
so far as disputes arising out of events occurring during the
present crisis are concerned.

6. Although the Commonwealth Government cannot now, strictly
speaking, denounce the General Act or add to its acceptance a new
reservation since, in accordance with its provisions, it is bound
by it for a further period of five years from 16th August, 1939,
it is suggested that action might be based upon grounds similar to
those suggested in relation to the Optional Clause.

7. Draft cablegram accompanies this memorandum. [2]

H.S. GULLETT