[467] *Part VI: The Tribunal should award a sum in gross to the United States.

Offer of the American Commissioners in the Joint High Commission. [468] In the opening conference of the Joint High Commission relating to the Alabama Claims, the American Commissioners stated the nature of the demands of the United States. They said that there were “extensive direct losses in the capture and destruction of a large number of vessels with their cargoes, and in the heavy national expenditures in the pursuit of the cruisers, and indirect injury in the transfer of a large part of the American commercial marine to the British flag, in the enhanced payments of insurance, in the prolongation of the war, and in the addition of a large sum to the cost of the war and the suppression of the rebellion.” They further said that the amount of the direct losses to individuals “which had thus far been presented, amounted to about fourteen millions of dollars, without interest, which amount was liable to be greatly increased by claims which had not been presented:” and that the direct loss to the Government “in the pursuit of cruisers could easily be ascertained by certificates of Government accounting officers.” They added that *“in the hope of an amicable settlement, no estimate was made of the indirect losses, without prejudice, however, to the right of indemnification on their account in the event of no such settlement being made.”1

Rejection of the Offer by the British Commissioners. Terms of the sub-mission by the Treaty. The British Commissioners declined to make the “amicable settlement” which was proposed on the part of the United States. The Joint High Commission then entered into negotiations which resulted in an agreement “in order to remove and adjust all complaints and claims on the part of the United States, and to provide for the speedy settlement of such claims,” that all the claims “growing out of the acts committed by the several vessels which have given rise to the claims generically known as the Alabama Claims,” should be referred to this Tribunal of Arbitration. It was further agreed that this Tribunal, should it find that Great Britain had, by any act or omission, failed to fulfill any of the duties set forth in the rules in the sixth article of the Treaty, or recognized by principles of International Law not inconsistent with such rules, might then “proceed to award a sum in gross to be paid by Great Britain to the United States for all the claims referred to it.”

[469] *The claims as stated by the American Commissioners may be classified as follows:

1.
General statement of the Claims. The claims for direct losses growing out of the destruction of vessels and their cargoes by the insurgent cruisers.
2.
The national expenditures in the pursuit of those cruisers.
3.
The loss in the transfer of the American commercial marine to the British flag.
4.
The enhanced payments of insurance.
5.
The prolongation of the war and the addition of a large sum to the cost of the war and the suppression of the rebellion.

So far as these various losses and expenditures grew out of the acts [Page 186]committed by the several cruisers, the United States are entitled to ask compensation and remuneration therefor before this Tribunal.

Claims growing out of destruction of vessels and cargoes. [470] The claims for direct losses growing out of the destruction of vessels and their cargoes may be farther subdivided into: 1. Claims for destruction of vessels and property of the Government of the United States. 2. Claims for the destruction of vessels and property under the flag of the United States. 3. Claims for damages or injuries to persons, growing out of the destruction of each class of vessels. In the accompanying Volume, VII, the Tribunal will find ample data for determining *the amount of damage which should be awarded in consequence of the injuries inflicted by reason of the destruction of vessels or property, whether of the Government or of private persons.

Government vessels. The Government vessels destroyed were of two classes—those under the charge of the Treasury Department, and those in charge of the Navy Department. The Tribunal of Arbitration will find in Volume VII detailed statements of this class of losses, certified by the Secretary of the Navy, or by the Secretary of the Treasury, as the case may be.

The United States reserve, however, as to this and as to all other classes of claims, the right to present further claims and further evidence in support of these and such further claims, for the consideration of this Tribunal $ and also similar rights as to all classes of claims, in case this Tribunal shall determine not to award a sum in gross to the United States.

Merchant-vessels. [471] The United States, with this reservation, present a detailed statement of all the claims which have as yet come to their knowledge, for the destruction of vessels and property by the cruisers. The statement shows the cruiser which did the injury, the vessel destroyed, the several claimants for the vessel and for the cargo, the amounts insured upon each, and all the other *facts necessary to enable the Tribunal to reach a conclusion as to the amount of the injury committed by the cruiser. It also shows the nature and character of the proof placed in the hands of the United States by the sufferers. The originals of the documents referred to are on file in the Department of State at Washington, and can be produced if desired. The United States only ask a reasonable notice, giving them sufficient opportunity to produce them.

Injuries to persons. It is impossible, at present, for the United States to present to the Tribunal a detailed statement of the damages or injuries to persons growing out of the destruction of each class of vessels. Every vessel had its officers and its crew, who were entitled to the protection of the flag of the United States, and to be included in the estimate of any sum which the Tribunal may see fit to award. It will not be difficult, from the data which are furnished, to ascertain the names and the tonnage of the different vessels destroyed, and to form an estimate of the number of hardy, but helpless, seamen who were thus deprived of their means of subsistence, and to determine what aggregate sum it would be just to place in the hands of the United States on that account. It cannot be less than hundreds of thousands, and possibly millions of dollars.

[472] Expenditures in pursuit of cruisers. *The United States present to the Tribunal a detailed statement of the amount of the national expenditure in the pursuit of the insurgent cruisers, verified in the manner proposed of the American members of the Joint High Commission. The aggregate of this amount is several millions of dollars.

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Transfer of vessels to the British flag. The United States ask the Tribunal of Arbitration to estimate the amount which ought to be paid, to them for the transfer of the American commercial marine to the British flag, in consequence of the acts of the rebel cruisers.

On the 13th of May, 1864, Mr. Cobden warned the House of Commons of the great losses which the United States were suffering in this respect. He said:1

[473] [474] “You have been carrying on hostilities from these shores against the people of the United States, and have been inflicting an amount of damage on that country greater than would be produced by many ordinary wars. It is estimated that the loss sustained by the capture and burning of American vessels has been about $15,000,000, or nearly £3,000,000 sterling. But that is a small part of the injury which has been inflicted on the American marine. We have rendered the rest of her vast mercantile property for the present value*less. Under the system of free trade, by which the commerce of the world is now so largely carried on, if you raise the rate of insurance on the flag of any Maritime. Power you throw the trade into the hands of its competitors, because it is no longer profitable for merchants or manufacturers to employ ships to carry freights when those vessels become liable to war risks. I have here one or two facts which I should like to lay before the honorable and learned gentleman, in order to show the way in which this has been operating. When he has heard them, he will see what a cruel satire it is to say that our laws have been found sufficient to enforce our neutrality. I hold in my hand an account of the foreign trade of New York for the quarter ending June 30, 1860, and also for the quarter ending June 30, 1863, which is the last date up to which a comparison is made. I find that the total amount of the foreign trade of New York for the first-mentioned period was $92,000,000, of which $62,000,000 were carried in American bottoms and $30,000,000 in foreign. This state of things rapidly changed as the war continued, for it appears that for the quarter ending June 30, 1803, the total amount of the foreign trade of New York was $88,000,000, of which amount $23,000,000 were carried in American vessels and $65,000,000 in foreign, the change brought about being that while in 1860 two-thirds of the commerce of New York were carried on in American bottoms, in 1863 three-fourths were carried on in foreign bottoms. You see, therefore, what a complete revolution must have taken place in the value of American shipping; and what has been the consequence? That a very large transfer has been made of American shipping to English owners, because the proprietors no longer found it profitable to carry on their business. A document has been laid on the table which gives us some important information on Mils subject. I refer to an account of the number and tonnage of United States vessels which have been registered in the United Kingdom and in the ports of British North America between the years 1858 and 1863, both inclusive. It shows that the transfer of United States shipping to English capitalists in each of the years comprised in that period was as follows:

  • “In 1858, vessels 33, tonnage 12,684.
  • “In 1859, vessels 49, tonnage 21,308.
  • “In 1860, vessels 41, tonnage 13,638.
  • “In 1861, vessels 126, tonnage 71,673.
  • “In 1862, vessels 135, tonnage 64,578.
  • “In 1863, vessels 348, tonnage 252,579.2

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[475] [476] *“I am told that this operation is now going on as fast as ever Now, I hold this to be the most serious aspect of the question of our relations with America. I care very little about what newspapers may write, or orators may utter, on one side or the other. We may balance off an inflammatory speech from an honorable member here against a similar speech made in the Congress at Washington. We may pair off a leading article published in New York against one published in London; but little consequence, I suspect, would be attached to either. The two countries, I hope, would discount these incendiary articles, or these incendiary harangues, at their proper value. But what I do fear in the relations between these two nations of the same race, is the heaping up of a gigantic material grievance, such as we are now accumulating by the transactions connected with these cruisers; because there is a vast amount of individual suffering, personal wrong, and personal rancor arising out of this matter, and that in a country where popular feeling rules in public affairs. I am not sure that any legislation can meet this question. What with the high rate of insurance, what with these captures, and what with the rapid transfer of tonnage to British capitalists, you have virtually made valueless that vast property. Why, if you had gone and helped *the Confederates by bombarding all the accessible sea-port towns of America, a few lives might have been lost which, as it is, have not been sacrificed, but you could hardly have done more injury in destroying property than you have done by these few cruisers.”

Enhanced rates of insurance. With the reservations already stated, the United States present the amount, so far as it has come to their knowledge, of the enhanced payments of insurance, caused by the acts of the insurgent cruisers. All of these cruisers came from England; and should the Tribunal find Great Britain responsible for the injuries caused by their acts, it cannot be denied that the war risk was the result of their dispatch from British ports. The amount of this injury, so far as yet known to the United States, appears in Vol. VII.

Prolongation of the War. [477] It is impossible for the United States to determine, it is perhaps impossible for any one to estimate with accuracy, the vast injury which these cruisers caused in prolonging the war. The great exertions which were made in the months of April, May, and June, 1863, to secure arms and ammunition for immediate use in Richmond have already been noted. Letter followed letter in rapid succession, urging Walker to forward the desired articles without delay. The energetic measures which Walker took to obtain *coal to enable him to comply with his instructions have been commented on. The insurrection was at that moment gathering itself up for a blow which was intended to be final and decisive.

On the 29th of April in that year Grant, having taken an army past the fortifications of Vicksburg, began the attack upon Grand Gulf, and from that day conducted his operations with such vigor that, by the 21st of May he had defeated the armies of such insurgents in five pitched battles, and had commenced the investment of Vicksburg. In the Atlantic States the fortunes of the United States had been less favorable. The Army of the Potomac under Hooker had met with a decided reverse at Chancellorsville, and was resting inactive after the failure.

The military authories at Richmond, having received the supplies which Walker had forwarded, selected this moment for a blow in Pennsylvania, which was intended at once to relieve Vicksburg, and decide the contest. History tells how utterly they failed. After three days of bloody fighting, Lee retired from Gettysburg discomfited. The same day Grant entered Vicksburg and opened the Mississippi.

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[478] [479] The 4th day of July, 1863, saw the aggressive force on land of the insurrection crushed. From that day its only hope lay in prolonging a defense *until, by the continuance of the permitted violations of British neutrality by the insurgents, the United States should become involved in a war with Great Britain. The insurgents had, at that time, good reason to look for that result. The Florida, the Alabama, the Georgia had left British ports for the purpose of carrying on war against the United States, and were, nevertheless, received with unusual honors and hospitality in ail the colonial ports of Great Britain. Only ten days before the battle of Gettysburg, the judge who presided at the trial of the Alexandra had instructed the jury that no law or duty of Great Britain had been violated in the construction and dispatch of the Alabama. About three months before that time Her Majesty’s Government had decided that they would not recommend Parliament to enact a more effective law for the preservation of neutrality. Laird was constructing the rams in Liverpool under the existing interpretation of the law, and the British Government was refusing to interfere with them. The Chancellor of the Exchequer, five days before the battle of Gettysburg, had declared in the House of Commons, speaking not individually, but in the plural, “We do not believe that the restoration of the American Union by force is attainable.” Under these circumstances the insurgents made great exertions to keep the *Florida, the Alabama, and the Georgia afloat, and to stimulate their officers and crews to renewed destruction of the commerce of the United States. They counted, not without reason, upon inflaming popular passion in the United States by the continuance of these acts, until the people should force the Government into a retaliation upon Great Britain, the real author of their woes. In pursuance of this policy they withdrew their military forces within the lines of Richmond, and poured money into Bullock’s hands to keep afloat and increase his British-built navy, and to send it into the most distant seas in pursuit of the merchant marine of the United States.

Thus the Tribunal will see that, after the battle of Gettysburg, the offensive operations of the insurgents were conducted only at sea, through the cruisers; and observing that the war was prolonged for that purpose, will be able to determine whether Great Britain ought not, in equity, to reimburse to the United States the expenses thereby entailed upon them.

Interest claimed to the date of payment. [480] On all these points evidence is presented which will enable the Tribunal to ascertain and determine the amount of the several losses and injuries complained of. To the amount thus shown should be added interest upon the claims to the day when the award is payable by the terms of the Treaty, *namely, twelve months after the date of the award. The usual legal rate of interest in the city of New York, where most of the claims of individuals are held, is seven per cent, per annum. In some of the States it is greater; in few of them less. The United States make a claim for interest at that rate. The computation of the interest should be made from an average day to be determined. The United States suggest the 1st day of July, 1863, as the most equitable day.

Reasons why a gross sum should be awarded. They earnestly hope that the Tribunal will exercise the power conferred upon it to award a sum in gross to be paid by Great Britain to the United States. The injuries of which the United States complain were committed many years since. The original wrongs to the sufferers by the acts of the insurgent cruisers have been increased by the delay in making reparation. It will be [Page 190]unjust to impose further delay, and the expense of presenting claims to another Tribunal, if the evidence which the United States have the honor to present for the consideration of these Arbitrators shall prove to be sufficient to enable them to determine what sum in gross would be a just compensation to the United States for the injuries and losses of which they complain.

[481] Above all it is in the highest interest of the two great Powers which appear at this bar, that the *causes of difference which have been hereinbefore set forth should be speedily and forever set at rest. The United States entertain a confident expectation that Her Majesty’s Government will concur with them in this opinion.

  1. Ante, pages 10, 11.
  2. Hansard, 3d series, Vol. 175, pp. 496–500; Vol. V, page 589.
  3. In the year 1864 one hundred and six vessels were transferred to the British flag, with an aggregate tonnage of 92,052 tons.