File No. 763.72112/1261

The Consul General at London (Skinner) to the Secretary of State

No. 523]

Sir: Referring to my No. 396, dated April 13, 1915, and to the Department’s cabled instructions of May 5 and 7, directing me to obtain the opinion of counsel on the above subject,1 I have the honor to report that Messrs. Charles Russell and Company have submitted to me the opinion of Mr. Leslie Scott, K. C., on the points raised in the Department’s inquiries. The opinion as submitted is enclosed herewith.

Upon the receipt of the opinion of Mr. Leslie Scott, I drew his attention to the first sentence therein, according to which the indemnity is intended to indemnify the Crown and all other official persons mentioned against all claims and proceedings within its scope instituted against any of those persons whoever may be the claimant, and I remarked that this view seemed to be negatived by Mr. Scott’s answer to the inquiry “Does this indemnity constitute a bar to prosecution in British courts of claims for damages?” Upon this particular point I have received a supplementary opinion, a copy of which is also enclosed as No. 2.

The Department will not fail to note from this correspondence that while the procurator general holds that the indemnity covers only possible claims of third parties, it is the opinion of Mr. Leslie Scott that taken by itself the indemnity debars the party giving the indemnity from claiming against the procurator general or any other official persons in respect of the goods released.

I have [etc.]

Robert P. Skinner
[Enclosure 1]

Opinion of Leslie Scott , K. C., re indemnity guarantee

COUNSEL is sent HEREWITH:

FORM OF INDEMNITY GUARANTEE

As Counsel knows all Claimants of goods detained by the British Authorities the validity of whose claims is recognized by the Procurator General are required to sign an Indemnity in the form sent herewith and unless they do so they are unable to obtain the possession of their goods. The Procurator General has informed the American Consul General that the only effect of the Indemnity is to protect the Procurator General against any claims that may be made in respect of the goods released. Many persons who have signed the Indemnities are dissatisfied with the terms on which the goods have been released and will probably wish to make claims against third parties for damages and other relief and the American Consul General therefore is frequently called upon to say whether the signing of the Indemnity will in any way prejudice the making of such claims hereafter.

Counsel’s attention is called to the third clause of the Preamble of the Order in Council of March 11th, and also to Order 13 subdivision 4 of the Prize Court Rules.

The American Consul desires to be advised on the following points with regard to the legal effect of entering into the Prize Court Indemnity Guarantee:

1.
Does this Indemnity constitute a bar to prosecution in British Courts of claims for damages.
2.
Does it constitute such a bar to prosecution before any International Tribunal which may be called upon to determine matters of this character.
3.
Generally as to the position of the Guarantor.

opinion

1. The Procurator General’s form of Indemnity is intended to indemnify not only the Procurator General but also the Crown and all the other official persons mentioned against all claims and proceedings within its scope instituted against any of those persons whoever may be the claimant. If any claim should be made by any third person against any one of the official persons mentioned the guarantor would be responsible to the Procurator General by way of indemnity for any damages awarded and for the costs of the proceedings. On the other hand the indemnity contains no undertaking by the party giving it that he will not make claims against third parties, and he is perfectly free to do so. The indemnity will only affect him if the claim he so makes should lead such third party in his turn to claim against the Procurator General. Whether such a contingency is likely to arise in practice I do not know—I therefore answer the questions:

(1)
No.
(2)
No.
(3)
The guarantor’s rights against any third parties other than the Crown and the other persons mentioned in the Indemnity are not directly affected by signing this indemnity.

Whether and if so how far they are affected indirectly it is difficult to say without concrete illustrations before me.

Leslie Scott


Goldsmith Building, Temple, E. C.
  1. Ante, pp. 375, 380, and 383.