Causation, Morality, And Quantum. (Biwater Gauff Ltd. (UK) V. Tanzania‪)‬

Quantum is rapidly losing its status as an under-theorized area of investment law. A veritable avalanche of books, book chapters, and articles has made a welcome contribution both to methods of valuation and to the philosophical underpinnings of the award of damages resulting from violations of investment treaty obligations. (1) This contribution will address only one small area--causation--and some of its ramifications. "Causation" serves several purposes in investment arbitration. (2) One role it plays is in establishing liability--harm resulting from unlawful conduct is attributable to the State if it is caused by State action, or by State inaction if the State had a duty to act. Conduct attributable to some actor other than the State does not give rise to State responsibility. A second role it plays is in establishing the amount of compensation due. There must be a causal link between the unlawful act and the injury, including monetary damages, that ensues. (3) In direct expropriation cases this inquiry is usually uncontroversial, as the taking of the property is virtually synonymous with injury because the deprived party has lost what he hitherto owned.