The history of peaceful settlement of dispute dates back from Jay Treaty of 1794 between U.S.A. & Great Britain. This treaty of Amity, Commerce and Navigation led to creation of mixed commissions and intended to functioN to some extent as tribunals. In 1872, the Albama claims arbitration between U.K. and U.S.A. marked the start of a 2nd Phase. Under the Treaty of Washington of 1871, the U.S.A. and U.K. agreed to submit to arbitration claim by United State for alleged breaches of neutrality by U.K. during American Civil war.