more broadly is discussed in greater detail in Part D, infra.
Having found Movants' allegations of irreparable harm inadequate to support an extension of the stay, we turn now to the remaining two factors of the four-part test.
C. Substantial Harm to Plaintiffs.
The third factor to consider in determining whether to grant Movants' application is whether the stay would "substantially harm" Plaintiffs. We find that this factor weighs heavily in Plaintiffs' favor.
Movants have argued throughout the litigation that a stay will not harm Plaintiffs because they have "already obtained the protection of a monetary judgment running in their favor for every day a stay is in place." See Government's Statement of Interest at 11. Movants refer to this Court's Judgment of January 15, 1992, which awarded damages for use and occupancy in the amount of $ 833.19 "for every day from November 1, 1991 until defendant vacates the premises."
Whatever the superficial logic of Movants' contention, it ultimately misses the point: this Court's Judgment is worthless unless Plaintiffs are guaranteed some means of recovering their rapidly escalating damages. Movants have represented that Zaire is in dire financial straits at the present time, see Wolf Dec. P4, and the Government specifically declined to insure collectibility in response to the Court's questions at oral argument. See Trans. at 5. In light of the uncertainty of recovering any damages under the Judgment, Plaintiffs' interest in "cutting their losses" by evicting the Mission and reletting the Premises is entirely understandable. Plaintiffs have therefore made a strong showing that they will suffer "substantial" harm in the event that a stay is granted.
D. The Public Interest.
The final factor that we must consider is whether a stay pending appeal would serve the public interest. Movants raise essentially the same arguments with respect to this factor as they did with respect to their claim of irreparable injury -- that the public interest is ill-served by forcing the Government to violate its obligations under international law and that we should exercise extreme care to prevent a landlord-tenant dispute from escalating into an "international incident." See Government's Statement of Interest at 11.
In response to Movants' contentions, we return to an issue raised earlier in addressing their allegations of irreparable injury: that no matter how important the Executive Branch's asserted foreign policy objectives may be, Plaintiffs should not be forced to assume sole responsibility for them. If the interests are as significant as the Government insists, they can surely be promoted more equitably -- possibly by designating United States or United Nations funds to insure collectibility of the Judgment -- than by thrusting their entire burden on the shoulders of a single private landlord. As Plaintiffs have argued and as we suggested repeatedly at oral argument, any other conclusion would raise a serious issue as to whether Plaintiffs had been subjected to an unconstitutional "taking" under the Fifth Amendment. See Memorandum of Law in Opposition to Defendant's Motion for a Stay at 8, 27; Trans. at 9-10, 19-20.
As a final matter, we note that it is far from obvious that the public interest and the interest of sovereigns themselves would be served by a finding that mission premises were immune from eviction. It is of course for the State Department, and not for this Court, to evaluate the chilling effect which would be placed on prospective landlords' willingness to rent to foreign sovereigns if the consequence of such a rental was the effective transfer of title insofar as legal remedies for non-payment of rent were concerned. Nevertheless, because Movants have argued that landlords have means of protecting themselves other than the eviction remedy, see, e.g., Government's Supplemental Statement of Interest at 15 n.4, we feel compelled to address them.
The Government first seeks to minimize the concern that landlords may be deterred from renting to foreign sovereigns by noting that some landlords attempt to avoid Plaintiffs' plight by obtaining letters of credit guaranteeing payment of the rent. If such letters of credit extend only over the stated term of the lease, however, they would clearly afford insufficient protection against a diplomatic tenant who wrongfully remains in possession after the lease has expired. The cost of a letter of credit which sought meaningfully to protect the landlord would be considerable, and such cost would of course be borne by the tenant.
The Government next suggests that a landlord could protect itself by requiring a waiver of sovereign immunity in the lease itself. That proposal is also subject to significant limitations, however. In the first place, the waiver exception set forth in the FSIA appears to extend only to "property . . . used for a commercial activity in the United States." FSIA § 1610(a); see also H.R. Rep. No. 1287, 94th Cong., 2d Sess. 29, reprinted in 1976 U.S.C.C.A.N. 6604, 6627 (stating that the "property in question must be used for a commercial activity in the United States" for the exceptions in paragraphs (1)-(5) of § 1610(a) of the FSIA to apply). The exception would therefore be of little help to a landlord renting to a mission, which by definition is used for diplomatic rather than commercial purposes.
Even were Plaintiffs able to invoke the waiver exception under the FSIA, however, that would not settle the issue. Since the immunity conferred by the FSIA is explicitly "subject to existing international agreements to which the United States [was] a party at the time" of the Act's passage, see FSIA § 1609, we would still have to consider whether waiver was prohibited by any of the other treaties or charters discussed above. Finally, even assuming that an explicit waiver were permissible under those other agreements, it still might not protect a landlord where, as here, the lease containing the waiver has terminated and it is unclear whether the waiver is still in effect.
In sum, it is far from clear that a stay of the Judgment is in the best interest of the public. Movants have therefore failed to demonstrate that this factor supports their contention that a stay should be granted.
As our above review of the four factors suggests, Movants have failed to make a showing of likelihood of success on the merits, have made an inadequate showing of irreparable injury and promotion of the public interest, and have not overcome Plaintiffs' showing of substantial harm in the event a stay is granted. In an ordinary case, therefore, we would deny Movants' application for a stay in its entirety.
This is not an ordinary case, however, and as our discussion in Part A of the opinion reflects, our view of the merits has been influenced by the Mission's abundant notice of the eviction and corresponding ability to protect itself against any breach of security that it might engender. To lay to rest any lingering fears that a hasty eviction might threaten the confidentiality of Mission papers or the privacy of its members, however, we will deny Movants' request for a stay pending appeal but grant a more limited stay until April 20, 1992. That period will have the additional benefit of permitting any party to apply to the Second Circuit for a further stay. We deny any stay beyond April 20, 1992.
Dated: March 24, 1992
New York, New York
Leonard B. Sand