File No. 763.72112/662
The Consul General at London (Skinner) to the Secretary of State
No. 249]
London,
January 15, 1915.
[Received January 26.]
Sir: Referring to my despatch No. 215,
dated January 1,2 enclosing a note from the British Foreign
Office dated December 23 stating that after consideration of my
representations, payment of freight and charges incurred in
connection with the release of American
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cargoes shipped before the war would be
remitted, I have the honor to report that as the note from the
Foreign Office was somewhat obscure, I immediately brought its terms
to the attention of the procurator general. I requested the
procurator general to give me his opinion as to the application of
the Foreign Office note to cargoes shipped in British vessels,
which, as it seemed to me, should be dealt with in the same manner
as cargoes shipped in enemy vessels. I continued:
I take it that a good many releases have been effected in which
freight and charges have been collected and which would have
been released free of charges under the terms of the enclosed
note. May I inquire how it is proposed to deal with these
matters, as I assume that freight collected under these
circumstances will be reimbursed?
Finally would you be kind enough to explain to me what are meant
by cases “in which the cargo released would have been condemned
either to confiscation or to detention if it had been taken into
the prize court”? It does not seem to me possible to assume that
in given cases the prize court would have condemned any cargo
confiscated without actually taking the case to trial.
Perhaps you would be so good as to illustrate this class of cases
by reference to one or two with which I am familiar.
I have received a reply from the procurator general, a copy of which
is enclosed herewith.
The reply deals not only with my inquiries of January 1 based upon
the Foreign Office note, but also with letter of December 31, 1914,
reiterating the contention that under Article 43 of the Declaration
of London cargoes shipped before the war were not liable to
condemnation and that proceedings in the prize court in respect of
such cargo were entirely inappropriate. The Department will not fail
to note that upon this point the procurator general joins issue with
me.
While the correspondence with the British authorities in respect of
payments of freight and charges which they have been collecting on
released cargo is not wholly satisfactory, at least some substantial
progress has been made. The procurator general states that he is now
prepared to consider applications for the reimbursement of freight
collected under these circumstances.
I have no means of knowing what particular claimants have paid
freight which should be reimbursed, except as to perhaps three
hundred cases which have been brought to my personal attention.
Perhaps the Department may have some suggestions to make upon this
point.
I have [etc.]
[Enclosure]
The British Procurator
General to the American Consul
General
Sir: I regret that owing to pressure
of other business I have been unable hitherto to reply to your
letters of the 31st ultimo and the 1st instant.
Taking first your letter of the 31st instant [sic], I understand that the cargoes there referred to
in the S. S. Belgia are being treated as
being subject to prize proceedings on the ground that they are
enemy property.
I understand that you desire to raise the contention that
notwithstanding that they are enemy property they are exempt
from condemnation under Article 43 of the Declaration of London.
Probably I have not fully understood the scope of your
contention, but my difficulty is that the articles, of which
Article 43 forms one, are not dealing with enemy property at
all. They are dealing
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with contraband which, ex hypothesi, is
neutral property. If it were enemy property, there would be no
need to consider whether the property was contraband or not and
Article 43, as I understand, is introduced for the purpose of
protecting neutral contraband in certain circumstances; and it
is provided that when those circumstances are present, the
contraband is not liable to condemnation nor is the ship or the
remainder of the cargo liable to condemnation under Articles 41
and 42 as they might otherwise be if the contraband were liable
to condemnation. At present, therefore, I am afraid I do not
quite follow the contention that Article 43 would apply to the
case of enemy goods, but I feel that I may have misunderstood
the point which you wish to put forward and I shall be glad to
reconsider the matter if you will return to it in further
correspondence.
With regard to your letter of the 1st January, the note to which
you refer is not applicable to cargoes shipped in British
vessels. I think that in an interview which, I had with you at a
very early stage I pointed out that the British Government could
not interfere between the owners of British ships and the owners
of American cargoes, and that, in such cases, the freight must
be paid where by law it was payable and, of course, would not be
payable where by law it was not payable; and I think that if you
will refer to the correspondence which has passed between us you
will find that the reference throughout is only to cargoes on
enemy vessels and certainly that is so in the note addressed to
the Ambassador to which you refer.
As regards the question of past release where the cargoes would
have been released free of freight under the terms of the
enclosed note, I shall be prepared to consider applications for
the return of the freight.
I am afraid that pressure of work may cause some delay in these
matters as the claims of persons seeking to have their cargoes
must necessarily have priority, but the matter will be dealt
with as speedily as is found possible.
Finally with regard to the question asked in the third paragraph
of your letter, the question whether the cargo released would
have been condemned if it had been taken into the prize court
must, of course, under the circumstances prevailing, be decided
by the procurator general or the committee dealing with the
matter, to the best of his or their judgment upon the facts
appearing in the case.
It would be impossible within the confines of a letter to give a
full account of all the cases in which property would or would
not be condemned which would amount almost to writing a treatise
on prize law, but fortunately there is, as far as I know, no
difference as regards the law on these subjects between the
American and the English prize law. In fact some of the
authorities to which we chiefly refer are those of great
American lawyers.
There are, however, two guiding principles which I think may be
of assistance to you: The first is that, as was decided in the
Miramichi case, the question depends
on whether the property has or has not, at the time of seizure,
passed to the enemy in accordance with the ordinary rules of
English law, that is, in cases of shipments before war with
which alone we are now dealing. The second principle is that
where the goods are on enemy ships there is a presumption in
favour of their being enemy goods which it lies upon the owner
of the goods to rebut.
As regards illustrations I might perhaps refer to the cases where
property is under a f. o. b. contract and has been shipped to
the order of the enemy purchaser. There have been many such
cases in which the property has undoubtedly passed to the enemy
but in which the procurator general or the committee have, in
the exercise of their discretion, returned it to the American
owners who have not received payment. Another class of case is
where the documents have gone forward to the enemy consignee and
passed into his possession or where no evidence is forthcoming
as to whether they have passed into his possession or not. In
all these cases I think that no doubt can be felt that the prize
court, on the matter being put before them on that state of
facts, would have condemned the cargo.
There is a case which has recently been considered, which though
perhaps not typical of a large class of cases is also a case
where the property would have been condemned, and that is the
case which you have put forward of the National Cash Register
Company. There the goods were sold to German companies having an
independent corporate existence in Germany and the property had
undoubtedly passed to the German companies, and on that account
the goods would have been condemned by the prize court. It was,
however, considered
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under the circumstances of the case that the goods might fairly
be released, but in that case the committee have decided that
freight should be charged in accordance with the terms of the
note.
I am [etc.]
