Re: "INSTITUTIONAL CONTROLS: THE NEXT FRONTIER"

[TommeY@aol.com]

Re:  Emery Graham's questions:  
    There is a clear legal reason which prevents the use of stiff fines and 
penalties in the enforcement of agreements of the type being discussed -- 
those agreements are, by definition, contracts; and the proper basis for 
their enforcement is contract law, under which contractual (and similar) 
damages, recission, and in some cases, direct enforcement of contractual 
provisions are virtually the only acceptable legal remedy (there are a few 
remedies called "quasi-contractual" but these do not include the use of 
governmental penalty authority either.)

Stiff fines and penalties may still be applicable, but only if based on 
violation of environmental laws (the only proper legal basis for using 
government punitive authority.)  

If the contract violation is also a violation of environmental legislation, 
then fines, imprisonment, and other penalties are appropriate.  Otherwise 
besides contractual remedies (see above), the government (the other party to 
the contract) may legally 
    (1) keep a list of persons who are not permitted to enter into such 
contracts in the future (I don't know if they do this, but EPA does maintain 
similar lists in other contexts.)
    (2) include requirements of a variety of "institutional controls" (as 
discussed in the article by Katherine N. Probst), possibly including a 
fine-like payment provision (called a "liquidated damages clause") in the 
contract.  If it is part of the agreement, and both parties have agreed to 
it, such an assessment would be legally enforceable under contract law, (but 
also negotiable at the time the contract was created.)

Tomme Young
UN Legal Consultant on Environmental and Conservation Legislation