On September 3, 1940, President Franklin D. Roosevelt sent to Congress a message in which he stated, in part:

President Wilson asserted in 1917 that “neutrality is no longer feasible or desirable where the peace of the world is involved and the freedom of its people.” In March, 1920, at its second session, the League of Nations Council affirmed that “the conception of neutrality of the members of the League is incompatible with the principle that all members will be obliged to cooperate in enforcing respect for their engagements.” In 1929 the British Foreign Office officially declared that “as between members of the League there can be no neutral rights because there can be no neutrals.” And in 1932 Secretary of State Stimson declared in reference to the Pact of Paris that “hereafter when two nations engage in armed conflict either one or both of them must be wrongdoers—violators of the general treaty. We no longer draw a circle about them and treat them with the punctilios of a duelist’s code. Instead we denounce them as law-breakers.”

Whether or not it was possible at the time for those who framed the treaties which terminated the World War of 1914–1918 to have better provided for the years of peace which were to follow, it is now generally recognized that the terms agreed upon by the Allied Powers and imposed upon Germany were not as wise as they might have been. This is a conclusion which experience has demonstrated, and, from this experience, it is proper that nations should derive wisdom with regard to any future treaties of peace which may be entered into. Hence it is that, since the outbreak of the present European war, there has been much discussion as to what terms should be imposed upon Germany if and when she is compelled to sue for peace.

Though the eighteenth year of the Permanent Court of International Justice has been the most critical year in its history, the Court has carried on its work in a regular way and some notable additions to its jurisprudence have been made during the year.

In the early months of the year, the Court held two series of meetings, from January 19 to April 4, and from May 15 to June 15; later in the year a series of meetings was held from November 28 to December 5. The Court was in actual session during the year for a total of 116 days; this was considerably less than the average of 144 days for each of the previous seventeen years, though it exceeded the number of 69 days of actual session during the year 1938.

The Egytian problem presents two aspects. One concerns the purely political struggle for independence. The other has to do with the favored position of foreigners in Egypt under the régime of the Capitulations. The former was primarily a private concern between the two countries involved—Egypt and Great Britain. The other, while touching in a special manner the responsibilities accepted by the “occupying Power,” concerned in an important manner the several foreign nations which had come to have stakes of great importance in the country—interests of a commercial, professional, educational, religious and even semi-political character. The separate nature of these two aspects of the same problem is well illustrated by the fact that two entirely separate series of international negotiations were required to deal with them.

The crisis of practical international law has forced the science of international law to take stock of its most fundamental notions. Discussion is in full sway about the essence of international law, about its adequacy and its development, and about the factors conditioning its growth and effectiveness. Together with this survey of the entire phenomenon of positive international law, attempts are being made to revise the theoretical construction, the philosophy of, and the method of approach to, international law. The most persistent trend in this discussion seems to be toward a functional conception of international law. As yet there is no agreement as to the exact meaning of functionalism. Perhaps it is not even desirable to define this meaning too rigidly during this early phase of the discussion.

The return of maritime warfare in the Atlantic and Pacific, and the proclamation by the United States of its neutrality in the existing state of war, raise anew important questions of law concerning the Panama Canal. While there is an abundant literature on the history of the Canal project, on the Panama Revolution, the Tolls controversy, the economic importance of the Canal and the cost of its defense, little has been written on the legal status of the Canal as a completed and operating institution. No complete survey of the treaties, laws, executive orders, regulations, agreements, opinions and decisions, and diplomatic correspondence seems to exist. Only by a laborious consultation of source materials, not all of which are easily accessible, can a comprehensive picture of the legal situation be pieced together. It is hoped that the treatment which follows may help to fill this lacuna.

On October 30, 1939, a series of 153 awards in the so-called Sabotage Claims against Germany was handed down by the Mixed Claims Commission under the Agreement of August 10, 1922, between the United States and Germany. These awards were made pursuant to the decision of the Commission rendered on June 15, 1939, and the order entered the same day, which held that German sabotage agents in this country were responsible for the destruction of the Black Tom Terminal on the night of July 29,1916, and the Kingsland Plant on January 11, 1917, and that Germany was liable for the damages resulting from these destructions. After the pleadings had been filed in 1927-1928, together with considerable evidence, and after the argument in Washington in April, 1929, and the reargument at The Hague in September, 1930, the Commission withdrew to Hamburg and rendered a decision dated October 16, 1930, dismissing all of the claims as not involving German responsibility. The Commission, however, found that the German Government had authorized a general campaign of sabotage in the United States during the period of neutrality and had sent men to this country for that purpose. The efforts of the American Agent in opposition to the German Agent to obtain a reconsideration of this decision resulted in several decisions of interest to the science of international law. The limited space permits only a summary discussion of the main questions.

It is to be hoped that one of the first measures to which Congress will give its attention during the next session will be the bill (H. R. 6127) “To revise and codify the nationality laws of the United States into a comprehensive nationality code.” This bill was introduced by the Honorable Samuel Dickstein, Chairman of the Committee on Immigration and Naturalization of the House of Representatives, May 3,1939. It embodies a draft nationality code, which was prepared under the direction of a committee composed of the Secretary of State, the Attorney General and the Secretary of Labor, in pursuance of an Executive Order of April 25, 1933. The cabinet committee submitted its report June 1, 1938, upon the basis of extensive studies and conferences by officials of the three Departments, and the report was submitted to Congress with a message of the President dated June 13, 1938.