Rescission is a form of relief which is available in respect of a variety of transactions (contract, gifts and conveyances) where one of the parties is subject to a vitiating factor (such as duress, fraud or misrepresentation) and she wants to get out of or ‘set aside’ the transaction. Rescission allows her to reverse the transaction. It has been said that ‘[t]he basic objective of the relief given upon rescission is to restore the parties to their original positions or, where rescission occurs in equity, as near to those positions as may be’. There is no requirement for the party seeking to rescind to suffer loss in the sense in which this is understood in the context of compensatory damages: she merely has to point to a vitiating factor. Although the party seeking to rescind can set aside the transaction, it is not voided: rather, it is rendered ‘voidable’. In other words, a voidable contract is valid and effective unless and until the plaintiff elects to rescind it. However, once a contract is rescinded it ‘is treated in law as never having come into existence’, although it is recognised that it formerly existed. All unperformed obligations under the contract are extinguished once a contract has been rescinded. The contract is extinguished as from the beginning (ab initio).

This chapter analyses the establishment, content and implementation of international environmental liability of the sponsoring State. First, it argues for a differentiation between State liability ex delicto and State responsibility and suggests to employ the former notion. Second, it points out the non-practicability of an application of the full reparation principle (restituto in integrum) for environmental damage and that liability of sponsoring State should be taken together with that of the contractor. Third, it argues that invocation of liability of the sponsoring State for environmental damage by the ISA is preferable to that by States (parties). As to liability of the ISA, it focuses on questions of whether and, if so, in what situations member States are held liable for the ISA. Based on analysis of the 2011 ILC Articles on Responsibility of International Organization, 1995 IDI Resolution and 2004 ILA Resolution, it finds out that there is a ‘no liability of member states’ rule which however allows for exceptions. It also discusses invocation of liability of the ISA.