Sir Julian Pauncefote to Mr. Wharton.
Washington, July 13, 1891.
Sir: Since the receipt of your note of the 25th ultimo, of which I transmitted a copy to the Marquis of Salisbury, I have been in telegraphic communication with his lordship respecting the two clauses (6 and 7) which, by direction of the President, you have proposed for adoption in the Behring Sea arbitration convention, and also respecting the form of agreement for carrying out the arrangement for the appointment of a joint commission to inquire into the conditions of seal life in Behring Sea.
I desire at present to confine myself to the clause proposed in your note, which deals with the question of compensation, namely, clause 7.
It is the only one which appears to me to raise any serious difficulty, and I trust that, after considering the following observations, and with a view to expediting the conclusion of this negotiation, the President will not object to the substitution of a clause in the form which I shall presently have the honor to submit.
Her Majesty’s Government have no desire to exclude from the consideration of the arbitrators any claim of compensation in relation to the Behring Sea fisheries which the United States Government may believe themselves entitled to prefer consistently with the recognized principles of international law. But they are of opinion that it is expedient, in a case involving such important issues and presenting such novel features, to prejudge, as it were, the question of liability by declaring that compensation shall be awarded on a hypothetical state of facts. Her Majesty’s Government consider that any legal liability arising out of the facts, as proved and established at the arbitration, should be as much a question for argument and decision as the facts themselves; and, in order that this should be made quite clear and that both Governments should be placed, in that respect, on the same footing, I am authorized by Lord Salisbury to submit the following clause in substitution for the seventh clause proposed by the President:
(7) Either Government may submit to the arbitrators any claim for compensation which it may desire to prefer against the other Government in respect of any losses or injuries in relation to the fur-seal fishery in Behring Sea for which such other Government may be legally liable. The arbitrators shall decide on the legality of every such claim, and, if it shall be established, they may award such compensation as, in their judgment, shall seem equitable.
I have, etc.,