Foreign Relations of the United States, 1902, Whaling and Sealing Claims Against Russia, On Account of Arrest and Seizure of the American Vessels “Cape Horn Pigeon,” “James Hamilton Lewis,” “C. H. White,” and “Kate and Anna,” Appendix I

Session of Monday, June 30, afternoon.

[June 30, 1902]

The session opened at 3 o’clock p.m.

Mr. Komarow, apropos of the provisions of the James Hamilton Lewis, of which it was question in the preceding session, and which he thought ought to demonstrate the importance of the vessel, cited the following figures, according to page 228 of the Report, Volume III. The vessel Emma and Louise in 1893 had $1,500 worth of provisions for the season from February. This vessel was of greater tonnage than the James Hamilton Lewis. The Alton had $1,400 worth of provisions; the Therese $1,281 worth. The James Hamilton Lewis went to sea on the 7th March; that is to say that five months’ of her supplies had been consumed when she was seized; she should have had enough left for one month and a half or two months, which was not the case, because she had been insufficiently supplied.

Mr. Peirce said that that list was consulted merely to ask Mr. Townsend whether a schooner thus provisioned was a first-class vessel or a small schooner such as the Indians used.

Mr. Komarow contested that from the figures presented it was a first-class vessel.

The Arbitrator asked the experts if they have anything further to say with regard to the probable catch.^a

Mr. Peirce said that unfortunately Mr. Townsend is not provided for the moment, as he believed this morning he would be, with the data necessary to establish an average. He cites Volume VIII, page 846, Fur Seal Arbitration. The arbitrator may hereby see that Canadian vessels have taken large numbers of seals. These vessels are not as well equipped as American vessels, for they usually have Indian crews.

Mr. Komarow wished to cite page 228 of the American report. The report is not in the court room.

The Arbitrator said it is now a question of the value of the skins. In the memorandum they are valued at $14.

Mr. Komarow produces the following documents, which relate to the sale of the confiscated skins:

1. Report of the Bureau of Agriculture; Report of the Department of Agriculture and of Rural Economy, section 1, bureau 3, August 21, 1892, Nos. 1115, 1159.

2. Report of the governor-general of the Amour; office, Bureau III, December 9, 1892, No. 135, city of Khabarowsk.

3. Report of the Ministry of Finances, special credit office, section 2, bureau 1, March 22, 1893, No. 3860.

4. Report of the Ministry of Finances, office of special credit, section 2, bureau 1, October 18, 1893, No. 13606.

5. Report of the Russian Sealing Company, St. Petersburg, January 13, 1897.

6. Copy of the telegraphic dispatch from Vladivostok, dated February 13, 1897, sub No. 1880.

Mr. Peirce called attention to the fact that the figures are not given in detail.

Mr. Komarow agreed.

Mr. Peirce asked if the company had been allowed a commission on the sale of the skins.

Mr. Komarow stated that the office of the Russian Seal Company on the 13th January simply says that the sale had been made on commission.

Mr. Grunwaldt. The company had not received brokerage or commission on its profits, but naturally commission had to be paid to the public auction house at London (commission, storage, etc., Maison Laopson).

Mr. Peirce said that 690 skins had been thrown aside as being of small value. It is evident that there were 562 skins, but it is not shown that they were the skins from the C. H. White.

Mr. Komarow agreed.

Mr. Peirce said Document II does not give the price, and simply mentions the sale; Document III gives the price, but makes no mention of the number of the skins. It shows that according to the documents the price of one skin was $10.

The Arbitrator asked Grunwaldt the average price.

Mr. Grunwaldt, speaking in English, said: Seals have different prices. It depends on the question of how many people want to buy and how many skins are on the market and at different places at same time, I ask you to agree with me. In the seal business the whole world has London prices. Russians and Americans have seals, but they have agencies who are English people. They are very highly placed in whole world (named companies). If they say that market is so and so, I agree they don’t lie. After thirty or forty years’ connection with seal market, I can decide intelligently. We can’t say prices; those people can who get paid from those people. They have not received skins now, and they have given money to Government; wish not in America nor in Russia to speak about this family thing of prices, but I must say that if price in London is £1 or 1 ruble, this price is not a price first stipulated as in form of law. Two different prices, regular and irregular. Regular price, that which Government gets from commercial agent party, who has the franchise; irregular price, that which people get when they get back to San Francisco in selling bundles of 200 skins. If this man can wait, he can get more money. Russia Seal Skin Company House, before it started there were more American than Russian in this business, more a form of politics. Russia gave to a party for twenty years a franchise from price of 75 k. or 1.50 for as many seals as they could catch. Aleut take seals in name of agency. After this thing which Alexander III by Russian people to give franchise to Russian society, all things were changed horrible, this (each will laugh) contract; people could not go to islands with schooners; had to arrange with somebody to get things from islands; now as I know family history, I say that name Morgan and his agent were at different times after Russian franchise was given in the islands to receive these things when they first came; the people had no idea that change had been made; they gave all they had in land to Morganites; received in name of late contract. They make arrangement with Lampson to help them out; hold back skins; otherwise prices would be this year zero. This is truth, though we have seen such high prices as T. stated this morning. In these prices are different qualities, making average. Twelve per cent discount for expenses of Lampson. 1882 to 1891 prices were 42s. for first-class Commander Islands Iseals. 1892 to 1899, 60s. It is shown this is not price at all that they received, because this is a price of occasion.

Mr. Peirce. So that they may have received more?

Mr. Grunwaldt. Never in life! Skins taken, some worse than others.

The Arbitrator stated that it has been said that the seal skins of these schooners could have been sold at London for $14.

Mr. Grunwaldt said that the 416 skins had been sold at London for £786 14s. 3d., as it appears from the Russian official documents now presented. This price could not have been obtained by the ship owners, if the skins had been sold by them, whereas the cost of transport and of the sale at auction would have been considerable. The sealing grantees of the Commander Islands had a contract with the railroad and the navigation companies at reduced prices for the transportation of seal skins, and, by an arrangement with Lampson & Co., they paid a smaller tax (7 per cent) than the ordinary tax (11 per cent) for the rights of storage and sale of skins.

Mr. Peirce said that Mr. Komarow has suggested that the owners of the schooners would not have received the same prices as the Russian seal companies, for the latter have agreements with the railroads. This is impossible, for it is forbidden to the railroad companies of the United States. He added that the price of freight could not exceed $1 per skin.

Mr. Grunwaldt explained that nevertheless there are agreements with railroad companies and the agents. It is a commercial secret; the cost of transportation in such cases is diminished 50 per cent.

Mr. Peirce protested and said that it is impossible; the interstate commerce law prohibits railroads from making a special contract with individuals or societies; they must give the same prices to everybody for same class of goods. The sea freight is a small item. The price at London is established by documents of Russia at $ 15—and it can’t be more than $1 for the transport and care of the furs. Not so much.

The Arbitrator explained how with us a reduction for the large transportations is possible. There are special tariffs which must be published.

Mr. Peirce. The price of cars is the same to everybody.

The Arbitrator returned to the question of prices. He states that $15 per seal skin was received at St. Petersburg. The price ought to be still higher in London.

Mr. Grunwaldt replied that that price was exceptional. The ordinary prices are less. Moreover a skin taken in pelagic sealing has an entirely different value from a skin taken by the companies who pay franchise rights to the Governments.

Mr. Komarow said that the prices are entirely different for regular and irregular sales. It can be recognized whether a skin has been legally or illegally taken.

The Arbitrator asked if the seal-skin business is carried on by agents or brokers.

Mr. Grunwaldt. The legally constituted enterprises, as well as individuals working independently, send the skins to the firm of Lampson at London, who puts upon them the necessary marks and assorts them. He showed the key. The firm of Lampson makes advances to the customers who send them skins.

The Arbitrator asked if seal skins are quoted in the London Exchange.

Mr. Grunwaldt. No; it is a private affair of the firm of Lampson, who moreover gives a report to its clients upon the auction returns.

Mr. Komarow read a report of the consul-general at New York of the year 1891. It reads:

I have been informed through confidential sources by persons well posted in the affairs of the new American exploitation company (North American Company), which has leased the Pribilof Islands, that one of the members of that company, Mr. Liebes, without the consent of the other partners, knowing that the number of skins to be taken in the eastern waters is limited to 5,500, sent marauding vessels into Russian waters.

The Arbitrator asked Mr. Townsend what was the price of skins in London in 1892.

Mr. Townsend. Seal skins are roughly divided into three classes, Pribilof, Commander, and pelagic. Pelagic are those killed in the Pacific hunt or even near the islands, if taken by pelagic sealers. Skins taken on the islands are specially prepared and of high value. In 1890 to 1892 all kinds were high priced, both those taken on land and in water, higher than before or since. The Pribilof are the highest priced, Commanders next, pelagic lowest. Pribilovs, sold in London as Alaskas, were worth in 1891 125s. Skins killed on the islands are selected three-year old males. Pelagic are cheap skins. Skins from Russian islands were worth 84s. Pelagic that year sold for 62s. in London. The entire pelagic catch comes from the North Pacific. Those from Lobos, Cape Horn, have nothing to do with these.

The Arbitrator. Have you reports to show this?

Mr. Townsend. Yes; I was member of the United States commission that drew up the report. The prices shown then were the prices secured from Lampson and shown by the British side.

The Arbitrator. Do you think there is a difference in price of skins sold by a large company or by private individuals?

Mr. Townsend. So far as I know prices of skins in Pacific are not different from those in London. Returning sealers go to Seattle, Port Townsend, San Francisco, Tacoma, and find from various owners there what skins are worth. The prices on the coast are very similar to prices in London. In 1895 there was a difference of $1 between San Francisco and London.

The Arbitrator asked if the prices varies according as the skins are sold by the captains or companies.

Mr. Townsend. Skins are purchased in San Francisco or Victoria by a few dealers who take many of the skins as they come in. This business is carried on by three or four companies.

The Arbitrator. If the owners of the Lewis would have to sell the skins they caught for themselves, could they have obtained the same price in London—as say Lampson & Co.?

Mr. Townsend. The Pacific coast prices were very little less at any time than in London. There is a market in San Francisco.

The Arbitrator. Are there papers that show that San Francisco is a market?

Mr. Townsend. The statistical reports of the United States Fishery Department show the prices paid in San Francisco. [Mr. Townsend showed statistics for 1895. These statistics were placed at the disposition of the arbitrator.]

The Arbitrator. How are these obtained?

Mr. Townsend. They were obtained from masters of vessels, and from owners.

The Arbitrator. It is estimation, not valuation?

Mr. Townsend. They are Government statistics.

The Arbitrator. How was that valuation made?

Mr. Townsend. The figures are taken from the books of owners, and the prices, too.

Mr. Grunwaldt said that there is a seal-skin market at San Francisco, and another in Russia. He contested that there are but three sorts of seal skins, as Mr. Townsend said. The number of qualities and subdivisions is far greater.

Mr. Komarow stated that the skins taken at sea have less value than those which are taken on shore.

Mr. Kroupsky said that the subdivision set forth by Mr. Townsend is purely scientific, and does not relate to the market classification.

Mr. Peirce. You stated that the prices on the London market vary as regards the Copper, Alaska, and Northwestern catches, were those average prices?

Mr. Townsend. Yes; because the table shows the catch taken as a whole.

The Arbitrator. Where were they prepared?

Mr. Townsend. They are British.

The Arbitrator. By whom made?

Mr. Townsend. By Lampson for Mr. Thompson.

The Arbitrator. So they are prepared for the information of someone who follows out a careful line of investigation?

Mr. Townsend. Yes.

Mr. Peirce. Is it not a common practice for pelagic sealers to go into the Pacific coast market with his seals?

Mr. Townsend. It was.

Mr. Peirce. Would he send his skins to London himself on his own account, or sell them in San Francisco, Victoria, Seattle, Port Townsend to one of the dealers?

Mr. Townsend. The whole catch is disposed of there to dealers.

Mr. Peirce. These prices were made from books of dealers?

Mr. Townsend. Yes; these prices were given confidentially.

Mr. Peirce. Suppose they had been public, was there any influence to make the dealers put unusually high or exaggerated prices on the skins?

Mr. Townsend. No; they are the natural prices of the articles.

Mr. Peirce. If he did, wouldn’t it make the owners of vessels who had skins to sell demand same prices?

Mr. Townsend. Doubtless.

Mr. Peirce. Whereas the dealers’ skins are sent to London and sold there?

Mr. Townsend. Yes.

Mr. Peirce. The party who gave these prices bought the skins to sell them again. If he had put too high prices on these skins it would have hurt him in London.

The Arbitrator. I thought you said the prices were got from the owners only?

Mr. Townsend. The collectors of statistics consult all sources, books, dealers in all fishing commodities, also shipping companies.

Mr. Grumwaldt wanted to know the names of the fur dealers who obtain their stock from the San Francisco market.

Mr. Townsend, could not name any; he could only name the vessels that have sold their skins at San Francisco.

Mr. Peirce asked what were the proceeds of the skins confiscated by the Russian Government.

Mr. Komarow. The confiscation took place at sea, but that does not prejudice the value of the skins, which, according to him, must have been taken in Russian territorial waters.

Mr. Grumwaldt insisted on the question whether there are sealskin merchants in San Francisco, and asks Mr. Townsend to name those merchants.

Mr. Townsend showed Mr. Grumwaldt the edition “Pelagic sealing,” page 298, and adds that there are here in the list of schooners that engaged in pelagic sealing about 12 vessels, namely: Bonanza, M. T. Dyer, Emma and Louise, Alton, E. E. Webster, Herman, J. Eppinger, Kate and Anna, Kattler, Therese, Bowhead, and Winchester.

Mr. Grumwaldt asked the arbitrator to ask Mr. Townsend, seeing that the list contains also the name of Kate and Anna, what were the names of the owners of some of these vessels.

Mr. Townsend replied that the owners of one were Liebes & Ladd, of San Francisco; Morgan, of Victoria, of another.

Mr. Grumwaldt. Now that the name of Mr. Liebes has been mentioned, it goes without saying what is the nature of that market, and I have no more to say. He however asked still further questions of Mr. Townsend.

Mr. Komarow submitted some documents

Mr. Peirce. You have seen seals killed on the islands?

Mr. Townsend. Many years.

Mr. Peirce. How is it done?

Mr. Townsend. With clubs.

Mr. Peirce. Is there a difference between a seal killed on the island who has been chased and one who has not been alarmed?

Mr. Townsend. Yes, the male seals are driven from sealing grounds slowly so as not to heat them. Possibly one out of a thousand that wandered might be spoiled.

Mr. Peirce. Is it the same in the water?

Mr. Townsend. Oh, no.

Mr. Peirce. The temperature of the water would urevent overheating.

Mr. Townsend. I suppose so.

The Arbitrator asked if anyone has anything further to say with regard to the price of skins. He addressed a letter to Mr. Peirce, delegate of the United States, relating to the price of the vessels James Hamilton Lewis and C. H. White.

Mr. Peirce said that he can give an answer right away.

The Arbitrator said he would nevertheless send the letter this evening and the reply can be given to-morrow morning.

The session ended at 5 o’clock, adjourning till to-morrow morning at 10 o’clock.

1. See morning session.