A government lawyer participating in negotiations for release of the American hostages said yesterday that precedents abound for the U.S. proposal for binding arbitration of the multibillion-dollar claims brought by Americans against the Iranian government.
"Almost every war or other incident with a foreign country has ended up in a claim settlement agreement between the two governments, signed by the executive branch, which provides either for settlement or binding arbitration," he said in a telephone interview.
The lawyer, who asked not to be identified, was disputed by attorneys in New York City for some of the large banks and corporations that have filed more than 300 claims against the Iranian government in federal courts. They were enabled to file the claims by the same November 1979 Treasury Department regulation that implemented a presidential order freezing Iranian assets within U.S. jurisdiction.
One, declining to let his name be used, said he and others believe "the government's conclusion is open to question and is not ironclad." Another, Robert B. von Mehren, counsel to the First National Bank of Chicago, termed it "highly doubtful" the president could abolish the courts' jurisdiction without new legislation. He contended that the International Emergency Economic Powers Act, the law invoked by President Carter to freeze the Iranian assets, was a legally insufficient basis for this.
Under the presidential orders or declarations proposed by the United States for release of the 52 Americans and made public late Saturday, transfer of jurisdiction from the courts would be part of a process to have the claims settled by an internaitonal arbitration panel whose awards would be honored by Iran.
In return for Iran's agreement to such a process, the United States would move to end all the litigation in the courts, thereby releasing frozen Iranian deposits and properties in the United States, according to the State Department.
The courts would have to decide if this is acceptable, a department source told reporters Sunday. He acknowledged that no precedent exists for "this particular" kind of claims procedure. But the government lawyer interviewed yesterday cited court rulings that have recognized "over and over again" the power of the president "to settle claims of U.S. nationals against a foreign government" and that hve included binding arbitration "enforceable in any court."
The State Department spokesman said the U.S. position is that "we would not have the assets returned until we are sure that the assets of Americans are protected." One possible way to make sure is to put the assets in escrow. The spokesman would not say whether escrow has been discussed with the Iranians. He did say that an escrow agreement, if there were to be one, would have to be binding.
"We wouldn't put money beyond our control unless we were assured that our interests were protected," he said.
The government lawyer suggested that for the U.S. claimants, arbitration might have a better potential payoff than litgation, partly because certain legal problems, such as the immunity of a sovereign government from lawsuits, would be eliminated. Before the freeze and the related regulation permitting claims to be filed, almost no claims were filed against Iran because of an assumption that sovereign immunity protected Iranian government assets from attachment. One federal judge since has rejected such immunity for certain assets, but his ruling is being appealed.
In a related matter, the newly repleased texts of the U.S. proposals said this country would commit itself to dropping or not pursuing claims for damages resulting from injuries or other harm done to the hostages. A lawyer involved with some of the 13 Americans released in November 1979 acknowledged this could be done by executive agreement, although it could be challenged in the U.S. Court of Claims.
The State Department said Sunday, however, that the government recognizes "the hostages and their families deserve every consideration" and that it is "prepared to consider [their] just and legitimate concerns. . . ."