No. 136.
Mr. Denby to Mr. Bayard .

No. 263.]

Sir: I have the honor to report that the consul-general has submitted to me the following question: “Is the storage of opium by an American firm forbidden under Article II of the treaty of 1880?”

[Page 175]

I have declined to answer this question specifically, but I have held that, under the facts communicated to me, Messrs. Russell & Co. were acting contrary to the treaty.

I inclose herewith a copy of my answer, which I submit to you for approval.

I have, etc.,

Charles Denby.
[Inclosure in No. 263.]

Mr. Denby to Mr. Kennedy .

Sir: I have the honor to acknowledge the receipt of your dispatch No. 20, of date November 26, 1886. In the absence of any statute construing or enforcing the second article of the treaty of 1880, it is very difficult to define accurately what acts are prohibited to be done by citizens of the United States. In a communication to Congress of date May 19, 1886, the honorable Secretary of State uses this language:

“The intent of the treaty is clear that no American citizen in China shall engage in or knowingly aid others to carry on the opium traffic.”

I shall not undertake to answer specifically the question pat, “Is the storage of opium by an American firm forbidden under Article II of the treaty of 1880?”

In advance of Congressional legislation it would not be proper for me to declare what acts are prohibited. It is sufficient to decide questions based on actual facts existing and communicated to me.

The facts admitted here are that Mr. Grieg, an Englishman in the employment of Messrs. Russell &, Co., deals in opium. He stores it in their godown and ho pays them “a commission from its storage.” Without deciding whether storage of opium by an American under all circumstances is prohibited, I incline to the opinion that storage in a warehouse owned, kept, and used by an American to carry on his own business is prohibited. Should I sustain the view that Messrs. Russell & Co. take of the treaty I would be practically deciding that every American in China can lawfully fill his warehouses with opium on storage, take care of it and protect it, insure it, maintain an action for its possession, and do every act relating to it that any warehouseman may do.

It seems to me that such a state of things would be contrary to the treaty. It is true that storing an article is not literally importing it, buying, selling, or transporting it; but there would be neither buying, selling, importing, nor transporting an article unless it could be stored for safe-keeping. The greater must be taken to include the less.

Let it be distinctly understood that I do not intimate that an American may not lawfully lease a portion of his godown, or that the lessee may not carry on any business therein which is not prohibited by the law of China or by international law. What I hold is that an American may not use his godown, which he uses and occupies for the transaction of his own business, for the purpose of storing opium therein.

Your second question is, “Is the receipt of commissions for such storage an infraction of Article II?”

The receipt of pay for storage would neither add to nor take from the act itself its illegal character. If the opium were stored gratuitously the act would still be wrongful. The violator of law can not shield himself against the consequences of an illegal act by the plea that he did it without reward. If pay is charged for storage it is a circumstance tending to characterize the transaction as an ordinary matter of business.

You will please send a copy of this dispatch to the United States consul at Foochow, and communicate its contents to Messrs. Russell & Co. I am satisfied that this distinguished and honorable firm had no intention to knowingly do any act contrary to the treaty. They have construed its terms strictly, while I have looked at its true intent and meaning.

The whole matter will be communicated to the honorable Secretary of State for his decision.

I am, etc.,

Charles Denby.