No. 37.
Earl Granville to Sir E.
Thornton.
[From British Blue Book “North America” No. 9, (1872.) p. 9.]
Sir: With reference to my dispatch of yesterday, I have to state to you that I received a note from General Schenck this morning, asking me to postpone the Cabinet, as he had just received a long telegraphic message in cipher from his Government, of the substance of which he would inform me at the Foreign Office at half-past 3 o’clock.
General Schenck accordingly called upon me in the afternoon, and informed me that the United States Government claim, and insist upon their claim, that under the Treaty the claims for indirect losses which have been put forward are admissible to be considered by the Arbitrators, although they do not expect, and never have expected, a pecuniary award of damages for such claims. Great Britain denies that such claims come within the scope or province of the Arbitrators to consider or decide upon.
The argumentative discussion has ended, leaving each party adhering to their position.
The United States Government in this condition of things have been willing to accept a proposal from Great Britain, that, in consideration of not pressing for a pecuniary award on these indirect claims, Great Britain would, on her part, agree to engage not to advance in the future in any case when she should be a belligerent, and the United States neutral, such claims for indirect damages as are put forward by the United States Government in the Case presented on their behalf to the Tribunal of Arbitration at Geneva, and to make that reciprocally the rule for the future. Great Britain is understood to object to this, on the ground that an agreement not to press for compensation for these indirect claims is not sufficient, because the Arbitrators in that case might themselves proceed to take them into consideration, and make them the subject of an award, and therefore Great Britain has only been willing to establish the rule in regard to indirect damages on condition that the American part of the Case at Geneva, which puts forward these particular claims, should be entirely withdrawn from the consideration [Page 495] of the Arbitrators. The President holds that he has power to give instructions in regard to the management of the case before the Arbitrators, and therefore could direct that these claims should not be pressed for an award. But, inasmuch as the Government of the United States hold that the claims are admissible to be considered by the Arbitrators under the Treaty, he cannot withdraw the claims as not being rightfully put forward without its being such an alteration of the terms and principles of the Treaty as is inconsistent with his understanding of it, and the interpretation which has been put upon it by his Government.
The treaty itself, however, may be amended in such a manner as to accomplish the object, and remove all differences between the two Governments arising out of their different interpretations of its provisions.
General Schenck is, therefore, authorized to state that the President “will be willing to consider, and, if possible, will present for the consideration of the Senate any new article for the Treaty which may be proposed by the British Government, which, while it settles the principle involved in the presentation of what are called the indirect claims, will remove the differences which have arisen between the two Governments in the consideration of the Treaty.
The President is earnestly desirous to do everything consistent with his duty and with the great interest for the future of both countries, and to preserve principles so important to civilization as he thinks are involved in the Treaty of which he is anxious to prevent the failure, and to this end he is willing to exhaust all proper efforts as far as can be done without abandoning any principle, and consistently with the honor and dignity of both Governments.
General Shenck said he had no instruction to suggest anything in relation to the form of words in which such an offer by Great Britain might be embodied. But it seems to him there might be three modes of framing such an amendment to the Treaty, either of which would accomplish the object.
- 1st.
- It might be recited that whereas differences of opinion have arisen between the two countries in relation to the interpretation of the Treaty of Washington as it relates to the right of the United States to put forward before the Tribunal of Arbitration at Geneva a claim for certain damages which, in their Case, are denominated indirect damages, in consideration of the withdrawal of those claims from the Case and from the consideration of the Arbitrators, Great Britain engages with the United States that she will not at any time hereafter, in the event of the United States being a neutral when Great Britain is a belligerent, advance any complaint or claims for such indirect, remote, or consequential damages arising from any failure on the part of the United States in the discharge of her neutral obligations.
- 2d.
- Let the Article to be agreed upon leave out any reference to the Case which has been presented at Geneva, establish the rule as above, and the United States give instructions to its Agent to withdraw those indirect claims, reciting them particularly whenever an exchange of ratifications of the amendment to the Treaty shall be made; and a copy of these instructions to be communicated to Great Britain.
- 3d.
- Establish by agreement in the same manner a rule against indirect damages, and provide that such rule shall relate back to and be held and taken as a part of the Treaty of Washington, the same as if this Article had been executed at the date of that Treaty.
I am, &c.,