Mr. Nelson to Mr. Seward.

No. 250.]

Sir: In my despatch No. 248, of the 15th instant, I had the honor to inform you of my endeavor to induce the government of Chili to terminate the present conflict with Spain and accept the arbitral decision of the United States in all questions between them. I likewise informed you of the verbal reply of Mr. Covarrubias, and that I should by the present mail transmit the official note containing the same.

[Page 376]

On the 19th instant I received a note from the secretary of foreign relations, dated February 17th, repeating the expressions used by him in that interview, and stating that should the obstacles therein alluded to be overcome, the government of Chili would be most happy to find itself so placed as to be able to co-operate in the success of the pacific desires of our government and my own. (A.)

I replied under date of the 23d instant, acknowledging the receipt of this note, and informing his excellency that so earnest was my desire for the cessation of the present conflict, that I should deem his declination of my proposal as merely conditional and temporary in its character, and requested him to consider that proposal as still existing, and clothed with a quasi permanent character that would enable his government to renew its consideration, should a favorable opportunity for its acceptance occur. (B.)

In alluding to the reply of Admiral Mendez to the United States consul, dated February 8th, 1866, (which should have formed enclosure C in the despach of the 15th instant, but was omitted for want of time to copy and translate it, and is now forwarded, marked C,) I stated that he characterized the consular protest as hostile, and its signers liable to be considered by the admiral as enemies of Spain. The document so characterized appears to have been the protest of the American merchants at Valparaiso interested in the Chilian coal mines, made before the United States consul on the 31st January—not that of the consular corps.

Upon presenting this protest to the consul of the United States, the gentlemen signing it addressed him a letter bearing the same date, (see enclosure D,) giving their reasons for protesting, and requesting him to take measures for the protection of their interests.

On being informed by the consul of the reply of the admiral, the merchants alluded to addressed the former a further note, taking exception to the views of the commander-in-chief, and renewing their protest, (E.)

On the 14th instant the Spanish frigates Villa de Madrid and Blanca returned to Valparaiso, after an absence of twenty-four days, and a rumor shortly after circulated to the effect that they had been engaged in combat, and were both seriously injured. On the 17th the Blanca and Numancia left in the night, destination unknown.

On the 20th, official information reached the government of a severe engagement, on the 7th instant, between the Spaniards and the allies, at the island of Abtao, near Chiloe, and the rendezvous of the allied squadron.

The Spaniards had two heavy frigates, the Villa de Madrid and the Blanca; the Chili-Peruvian fleet consisted of the Amazon, (frigate,) America and Union, (corvettes,) and Covadonga, (gunboat,) (captured from the Spanish on the 26th November.) The engagement lasted two hours, when the Spanish forces retired, having received severe injuries. The number of casualties on board the latter vessel is unknown, but it-is supposed to be great, as many shell exploded on board, carrying away the wheel and almost destroying the cabin of the Villa de Madrid. Fragments of the cabin, clothing, bodies of the slain, and other evidences of the disastrous effects of the allied fire, floated ashore after the fight. The only loss on the side of the allies was two men killed on the corvette Union. Each of their vessels was struck three or four times, but the damage was trifling. The machinery of the frigate Amazon being under repair, she was compelled to fight at anchor.

A mutiny is supposed to have broken out on the Villa de Madrid during the fight, as great confusion was observed on board, followed by a volley of musketry.

About 1,500 shot and shell were fired during the engagement. These data are from the official reports.

A few days since Admiral Mendez notified the British naval authorities that in the event of a single torpedo-boat being launched, or any attempt made to [Page 377] destroy his vessels by means of torpedoes, he would instantly open fire upon the town. This threat was communicated through the British legation to the government of Chili, which replied that, if it found it expedient to make use of torpedoes it would do so, and warned Admiral Mendez that any act of barbarity on his part against non-combatants would be severely visited upon the Spanish prisoners in his hands.

This fact I have learned extra-officially, but have reason to believe it reliable.

I have the honor to remain your obedient servant,

THOMAS H. NELSON.

Hon. William H. Seward, Secretary of State, Washington, D. C.

A.

[Translation.]

Mr. Covarrubias to Mr. Nelson.

Sir: I have the honor to reply to the note of the 12th instant, whereby your excellency was pleased to offer to my government, in compliance with the instructions of your own, the arbitration of the United States, in order to arrive at a pacific solution in the war at present waged by Chili against Spain. The assurances in this respect which your excellency is pleased to give me of the friendly solicitude with which the government of the United States has followed the vicissitudes of the present conflict, augment the high value of an offer which my government cordially esteems.

Nevertheless, you yourself have already perceived one of the obstacles which would prevent the immediate acceptance of a mode of solution which, however has always been considered by my government as most in conformity with civilization and humanity, and which has never ceased to obtain its sympathies. As your excellency very well observes, the treaty of alliance, offensive and defensive, between Chili and Peru would not permit my government to decide in regard to your excellency’s proposition without previously consulting the government of that sister republic. However, since your excellency is pleased to comprehend Peru in the offer of arbitration, this obstacle may be very transitory. This is not the case in regard to the obstacle presented by the good offices which have been tendered to the republic by the cabinets of London and Paris, by means of their diplomatic agents resident in Santiago, with a view of arriving at a solution analogous to that sought by your excellency. The conferences to which this effort for a settlement have given rise are yet pending, and until some result is reached therefrom no proposition could be taken into consideration the acceptance of which would be incompatible with the prosecution of the efforts of those cabinets.

Should the obstacles to which I allude disappear, the government of the republic would be much pleased to find itself then in a position which would leave it free to co-operate for a successful result to the pacific views of the United States, seconded by your excellency with a zeal and interest as generous as they are flattering to Chili.

In recognizing this, and in thanking your excellency therefor, I hasten to reiterate to you the expression of my sentiments of high consideration and particular esteem with which I am your excellency’s most obedient servant,

ALVARO COVARRUBIAS.

The Envoy Extraordinary, &c., &c., of the United States of North America.

B.

Mr. Nelson to Mr. Covarrubias.

Sir: I have received your excellency’s note, dated the 17th instant, in reply to my own of the 12th, wherein I had the honor to propose to your excellency’s government the arbitration of the United States, with a view of bringing to a peaceful and honorable termination the present contest between Chili and Spain.

[Page 378]

Your excellency is pleased to observe that while the obstacle presented to such arbitration by the existence of a treaty of alliance, offensive and defensive, between the republic and Peru is not insurmountable, such is not the case with regard to the difficulties presented by the action of the cabinets of London and Paris, which have tendered their good offices with similar views, through their representatives in Santiago; that the conferences for this purpose being yet pending, a proposition, the acceptance of which would be incompatible with the prosecution of such negotiations, could not be entertained.

Your excellency further states that should the obstacles alluded to disappear, the government of the republic would rejoice to find itself in a position to co-operate in carrying out the pacific views of the United States.

As it is the earnest desire of my government, and my own, to attain the object proposed, namely, a peaceful and honorable termination to the existing hostilities, I beg to say that your excellency may consider the offer made by me, in the name of my government, to that end as a permanent one, open to the acceptance of that of your excellency whenever the time for that acceptance shall, in its opinion, have arrived.

It only remains for me to reiterate to your excellency my earnest desire that soon such may be the case, and the republic of Chili exchange the evils of war for the blessings of peace and renewed prosperity.

Availing myself of this occasion, I have the honor to renew to your excellency the assurances of my most distinguished consideration and respect.

THOMAS H. NELSON.

His Excellency the Secretary of Foreign Relations of the Republic of Chili.

C.

[Translation.]

Reply of Don Casto Mendez Nunez to the protest of the consular corps of Valparaiso.

My Dear Sir: Together with the official letter, without date, which you have been pleased to address me, I have to-day received a protest, dated the 31st ultimo, presented in the consulate under your worthy charge by some citizens of the republic of the United States, referring to the determination taken by me respecting the coal from Chilian mines.

Before occupying myself with the protest, out of respect and attention to you, it is my duty to quote here that which Mr. Wheaton, the illustrious North American writer, says in his treatise upon the international law in regard to foreigners resident in one of the belligerent countries: “In general the national character of a person, as neutral or enemy, is determined by that of his domicile; but the property of a person may acquire a hostile character derived from personal residence. Thus, the property of a house of trade established in the enemy’s country is considered liable to capture and condemnation as a prize.” And further on he adds: “The production of an enemy’s colony, or other territory, is to be considered as hostile property so long as it belongs to the owner of the soil, whatever may be his national character in other respects, or wherever may be his place of residence.” In a word, that the hostile or neutral, in respect to foreigners resident in a country, is impressed by the national character of that country, and that the possession of the soil impresses likewise upon the proprietor the character of that very country, in so far as concerns the productions of that soil. Hence, that the commercial domicile, or the sustaining of any mercantile establishment in the enemy’s territory, and the personal domicile, carry with them a hostile character; and hence, also, nothing has this character more definitely than the trafficking with the territorial productions of the enemy, since they constitute the great wealth of the nation; from which is clearly and distinctly deduced, that in accordance with the principles of international law, universally recognized, the signers not only of the protest which you have been pleased to address me, but also of that which you delivered me the last time you came to this vessel, bear a hostile character, since the former are domiciliated and sustain commercial establishments in Chili, and the others are proprietors and trade with territorial fruits of the same Chili.

All this demonstrates that those who sign both protests have a character as hostile as though Chilian citizens were under consideration, and consequently they are wanting in the right, or rather that the law of nations deprives them of the right, of considering themselves as neutrals, in the case under consideration. The toleration of the government of Spain, and of its agents in these waters, has been such that they have not wished to put in practice, nor will they do so, that principle, save when there is a question, as now, of contraband of war, since, however respectable those interests may be in the opinion of the belligerent, the latter cannot render the measures conducing to the success of his operations subordinate thereto.

[Page 379]

Now, in regard to the right which I have to declare new articles contraband of war: Articles which, by the very circumstances of the war, might be employed in hostilities against the forces under my command, even when they may have been considered heretofore innocent, (as is the case with the coal of the Chilian mines,) it is so clearly set forth in international jurisprudence that it is unnecessary for me to enter into arguments to prove it; and the use of that right is even much more legitimate in the present instance, since the Chilian as well as the Peruvian vessels supply themselves with that coal in all the ports of the Pacific coast; and there is consequently every reason to suspect that they make use of the very coal sent to those ports under pretext of being used for industrial purposes; this grade of presumption being sufficient to render legitimate the measure protested against, even did other reasons therefor not exist. If these ports were only visited by merchant vessels, and if the Chilian coal carried there were only employed for pacific purposes, the quotation from Wheaton made use of by those who have protested might have some value; but I repeat that those very ports are visited by vessels hostile to Spain, and that they there provide themselves with that coal.

There is no similarity whatever, as pretended by the signers of the protests, between the declaration of a new article of contraband of war and a blockade, since the moment that declaration is made by one belligerent, in view of the rights conferred upon him by the laws of war, neutrals have no right to trade between the various ports of the other belligerent, nor between these and neutral ports, having on board any article or articles declared as such contraband of war.

As far as regards the very well-known maxim, that “a free ship makes free goods,” proclaimed in the existing blockade instructions, and which were published by the late general, his excellency Don José Manuel Pareja, its action does not extend to articles contraband of war, since if such were the case their declaration as such would be null and void, for it would be only necessary to carry them beneath a neutral flag to cause them to. cease to be so.

Finally, it is my duty to manifest to you the expressions contained in the last article of the instrument declaring Chilian coal to be contraband of war, and that is that I will continue to keep that declaration in force until my government shall otherwise order. I greatly regret, Mr. Consul, that the reasons set forth do not permit me to alter the said determination, since nothing gives me greater pleasure than to be able to please the representatives of nations friendly to Spain; above all when, as in the present instance, these representatives merit my highest respect and consideration.

I am, Mr. Consul, your most obedient servant,

CASTO MENDEZ NUNEZ.

D.

[Translation.]

The following note was sent, on the 30th of January, to the consul of the United States, Mr. Clark, by the firms of Alsop & Co., Loring & Co., and Don Pablio H. Delano, in the name of the Puchoco Coal Company, in union with the protest which said houses made against the determination of the Spanish chief declaring Chilian coal to be contraband of war:

Valparaiso, January 31, 1866.

Sir: We the undersigned, citizens of the United States, heavily engaged in the working of some of the principal coal mines of the country, have learned with surprise that the chief of the forces of her Catholic Majesty in the Pacific has notified the consuls of neutral nations here residing his determination to consider coal of the country as an article contraband of war, and, as such, he will seize it wherever he may find it and whatever be its destination.

The determination of the chief of the Spanish forces cannot be considered in any other light than as a desire to do by means of a simple decree that which (even supposing him to have the right to do so) he could only do by means of the forces under his command, and consequently ought not to be permitted by neutral nations: and it is to be hoped that the representatives of those nations will interpose prompt and efficient measures to prevent the citizens of the country they represent from suffering the damages which they inevitably would suffer were it permitted to take effect without opposition.

The proceedings of the Spanish chief in this affair are in fact nothing less than the establishment of a paper blockade of the coal-producing ports of this country, which is contrary to the principles of international law, since the free commerce of neutrals between neutral countries and the ports of one of the belligerents, or between two or more of such ports, cannot be impeded otherwise than by an effective blockade of those which it is desired to. keep closed.

[Page 380]

The right of free trade between neutral countries and non-blockaded ports of the belligerents, and between two or more of these latter, is not only a principle of international law, but in the war existing between Chili and Spain is a right insured to the citizens of the United States by the treaty in force between those States and Spain. Consequently the measure of which we complain is not only contrary to international law, but it is a positive infraction of that treaty.

Articles of common use can only be considered as contraband of war when they are intended for the aid of the military or naval forces of the enemy. Hence, according to Wheaton, the most important distinction is whether the articles are intended for the common uses of life, or for military purposes. The nature and quality of the port of their destination is the test to which the fact as to which they belong should be subjected. If the port be a commercial one, it is generally understood that the articles are intended for peaceful purposes, even though a vessel of war be occasionally constructed therein.

Now it is perfectly well known to all that there is no military or naval establishment in any of the non-blockaded ports of the republic to the north of those producing coal, and consequently that none of the articles introduced in those ports will be able to be applied to benefit the warlike operations of the Chilian forces, which are effected in another direction.

Up to the present time it has been always understood that articles contraband of war only become liable to the penalties incurred by them as such when they proceed from a neutral country to that portion of a belligerent one where a military or naval force is to be found, or to a blockaded port, or from the non-blockaded ports of a country to the blockaded ports thereof; consequently, the decree of the Spanish chief declaring that such articles may be captured when they proceed from non-blockaded ports to a neutral country, or to another non-blockaded port of the country itself, is an attempt to introduce an innovation into the practice of international law which it does not belong to him to make, since it is the right of his sovereign alone, and in making it he ignores the established principle that “free ships make free goods” of those on board of them.

If the pretensions of the chief of the forces of her Catholic Majesty are admitted unresistingly, they will cause inevitable ruin of all those who are engaged in the working of the coal mines, as well as of all those who have other branches of industry depending thereon, since the ruinous effects of the measure fall almost exclusively upon them, against equity, and in contradistinction to the express instructions of his government, by which he was Chargéd to avoid, as far as possible, injury to neutrals

Finding ourselves among the number of those upon whom the pernicious effects of the said measure fall most heavily, we have to-day protested before you against the government of Spain, against the chief of the Spanish squadron, and against all whom it may concern, for the damages which it may cause to us; and we now beg that you adopt such measures as you may deem opportune for the protection of our interest, and we feel confident that if they be taken promptly and efficaciously they will result in obtaining a revocation of the offensive measure of which we complain.

We subscribe ourselves, very respectfully, your obedient servants,

ALSOP & CO.

LORING & CO.

PAUL H. DELANO, Agent of the Puchoco Coal Company.

To Ambrose H. Clark, Esq., Consul of the United States.

E.

[Translation.]

The North American citizens, authors of the protest in regard to coal, have replied as follows to the note addressed to them by the Spanish commander.

Sir: You having informed us of the reply given by the chief of the forces of her Catholic Majesty in the Pacific to the letter which you addressed him, accompanied by a copy of the protest which we extended before you on the 31st ultimo, and of our letter of complaint addressed to you under the same date, we beg you to permit us to make some observations in reference to that reply, in the hope that if you be pleased to present them to that chief he may be even yet induced to withdraw, or at least modify, the terms of his declaration relative to Chilian coal, notwithstanding he has said at the close of his letter that he is resolved to sustain that declaration until his government shall otherwise order.

To uphold his right to declare Chilian coal contraband of war, and as such to seize, it wheresoever he may find it, even though it be the property of neutrals, he cites the work of Wheaton on International Law, but while respecting duly the opinion of the said chief, we [Page 381] may be allowed to say that that portion of the work of Wheaton whence he has taken his quotation is only applicable to the property of neutrals domiciliated in an enemy’s country which may be found on board in a situation which would permit its seizure; that is to say, when found on board of vessels of the enemy; but although it is in such cases liable to capture, it is not when it is found beneath a neutral flag. In such cases the maxim so well known that free ships make free goods, which he recognizes, will serve for their protection. The only exception to this is when the article is of the class called contraband of war, which coal is not. This brings us again to the question whether the chief of the Spanish forces in the Pacific has the right to declare articles of common use contraband of war. According to all writers upon international law this right belongs alone to the supreme executive power of a nation, and consequently it is without the sphere of his authority to declare coal so to be, unless when it is destined to some besieged or blockaded port. That his government ahs not so considered it is evident from the fact that his predecessor in the command omitted it from the list of articles to be so considered.

The omission to which we have referred authorized us to believe that we possess a perfect right to trade in articles of lawful commerce between this country and the ports of neutral nations, or between the non-blockaded ports of the former, and that this right would be respected by the forces of her Catholic Majesty which operate on this coast; and in this confidence we have entered into engagements for the delivery of coal at the different ports where there are smelting works and other industrial establishments, and have chartered numerous neutral vessels to carry the said coal, with none of which engagements will it be possible to comply, if the declaration of the Spanish chief relative to Chilian coal be sustained. This failure in compliance exposes us to claims for the damages resulting therefrom, and later will originate claims for indemnity against the Spanish government.

The chief of the Spanish squadron alleges, in support of his authority to declare Chilian coal contraband of war, that international law is so explicit in the premises as to render it unnecessary for him to enter into explanations to demonstate it, and that it is sufficient for him to have the presumption that the enemy’s vessels may supply themselves with that coal in the ports of the coast, in order to legitimatize the measure of declaring it contraband of war.

Now to us the legitimacy of the declaration by the mere presumption of possible eventualities does not appear so clear, and we are sustained in our mode of thinking by the same respectable authority in international law to which he appeals, since, in speaking of provisions as contraband of war, that author says: “If the mere hope, however apparently well founded, of annoying or reducing an enemy, by intercepting the commerce of neutrals in articles of provision (which in themselves are no more contraband than ordinary merchandise) to ports not beseiged or blockaded, would authorize that interruption, it would follow that a belligerent might at any time prevent, without a seige or blockade, all trade whatsoever with its enemy, since there is at all times reason to believe that a nation having little or no shipping of its own might be so materially distressed by preventing all other nations from trading with it, that such prevention might be a powerful instrument in bringing it to terms. The principle is so wide in its nature that it is in this respect incapable of any boundary. There is no solid distinction, in this view of the principle, between provisions and a thousand other articles. Men must be clothed as well as fed, and even the privation of the conveniences of life is severely felt by those to whom habit has rendered them necessary. A nation, in proportion as it can be debarred its accustoned commercial intercourse with other states, must be enfeebled and impoverished; and if it is allowable to a belligerent to violate the freedom of neutral commerce in respect to any one article not contraband in se, upon the expectation of annoying the enemy or bringing him to terms by a seizure of that article and preventing it reaching his ports, why not upon the same expectation of annoyance cut off as far as possible by captures all communication with the enemy, and thus strike at once effectually at his power and resources?” These observations are as applicable to coal as to provisions or to any other of the thousand articles of common use.

We entertain the hope that a reconsideration of the matter and a reference to the existing treaty between the United States and Spain, will induce his excellency to modify, if not entirely revoke, the recent declaration in reference to Chilian coal, and for this purpose we reiterate the request expressed at the beginning of this communication, that you be pleased to place it before him, endorsing it with such observations as you may deem proper.

We are, sir, very respectfully, your obedient servants,

ALSOP & CO.

LORING & CO.

PAUL H. DELANO, Agent of Puchoco Coal Company.

Ambrose W. Clark, Esq., Consul of the United States.