STATE SUCCESSION. The extent to which a succession State is bound by the obligations of its predecessor constitutes one of the most difficult problems in international law. The clearest statement is probably that contained in the report of the Transvaal Concessions Commission; see Parl. Pap. South Africa, 1901 [Cd. 623]. The principles which the commissioners regarded as applic able to the determination of questions relating to various con cessions granted by the Transvaal Government in view of the con quest and annexation of the Transvaal by Great Britain are as fol lows :—(1) "It is clear that a State which has annexed another State is not legally bound by any contract made by a State which has ceased to exist, and that no court of law has jurisdiction to enforce such contracts if the annexing State refuses to recognize them, see Cook v. Sprigg (1899) A. C. 572. But the modern usage of nations has tended in the direction of the acknowledg ment of such contracts. After annexation, it has been said the people change their allegiance, but their relations to each other and their rights of property remain undisturbed, U.S. v. Pencheman, 7 Pet. 51; and property includes rights which lie in contract, Soulard v. U.S., 4 Pet. 54." Concessions of a mixed pub lic and private character probably continue to exist after annexa tion until abrogated by the succession State. There would not ap pear to be any distinction between cession and annexation. Private rights should be respected, but this is based rather on ethics than law. (2) "Though we doubt whether the duties of an annexing State towards those claiming under concessions or contracts . . . have been defined with such precision in authoritative statement or acted upon with such uniformity in civilized practice, we are con vinced that the best modern opinion favours the view that as a general rule the obligations of the annexed State towards private persons should be respected. Manifestly the general rule must be
subject to qualification, as that an insolvent State could not by aggression which practically left to a solvent no other course than to annex it, convert its worthless into valuable obligations ; again an annexing State would be justified in refusing to recognize obli gations incurred by the annexed State for the immediate purposes of the war against itself ; and that probably no State would ac knowledge private rights the existence of which caused or con tributed to cause the war which resulted in annexation." (3) The principle to be adopted was that proclaimed by the Prussians upon the annexation of Hanover "we will protect every one in the pos session and enjoyment of his duly acquired rights." (4) "The acceptance of this principle clearly renders it necessary that the annexing Government should in each case examine whether the rights which it is asked to recognize have, in fact, been duly acquired. (5) Thus a concession may properly be cancelled when "(a) the grant of the concession was not within the legal powers of the late Government, or (b) was in breach of a treaty with the annexing State, or (c) when the person seeking to maintain the concession acquired it unlawfully or by fraud, or (d) has failed to fulfil its essential conditions without lawful excuse." (6) A con cession may be cancelled when its maintenance would be injurious to the public interest.
See A. B. Keith, Theory of State Succession (1907) ; Max Huber, Die Staatensuccession (1898) ; Westlake, Collected Papers; Pitt Cobbett, Leading Cases on Intern. Law Vol. II., 4th ed. (1924).