File No. 763.72112/1711
The British Embassy to the Department of State
Memorandum
It has been frequently suggested and sometimes actually asserted that the seizure of the cargoes consigned by the meat packers of Chicago to Copenhagen and other Scandinavian ports in the four ships which were the subject of the recent proceedings in the prize court and in the other ships in regard to which these negotiations have taken place, was a seizure effected under orders in council the [Page 567] validity of which is disputed by the Government of the United States, the implication being that in some way these cargoes were seized under the order in council of March 11, 1915. It seems hardly necessary to point out that this was not so. The cargoes were seized for the greater part long before March 1915, and the ground for the seizure was that they were conditional contraband destined from the first by the packers who shipped them largely for the use of the armies, navies, and Government departments of Germany and Austria, and only sent to neutral ports with the object of concealing their true destination. This is a ground for seizure which has been asserted and upheld by none more strongly than American courts and the leading American authorities on international law for over fifty years. That foodstuffs on a ship bound for enemy territory may be seized and condemned if there can be shown to be (in the words of Lord Stowell) a “highly probable” destination for military or naval use has long been a universally recognized and admitted principle of international law, and it was the American courts which first insisted upon the further principle that, if that destination is shown, it does not matter that the goods were found upon a ship sailing to a neutral port. In the application of this doctrine—the doctrine of continuous voyage—the British Government had acquiesced at the time of the American Civil War; and the circumstances of modern warfare, the development of international trade, and the increase in the rapidity of and the facilities for transport, both by land and sea, have made the doctrine the more reasonable and indeed essential, if a belligerent is to be allowed to exercise at all his undoubted right of interrupting the supply of foodstuffs to his enemy’s military and naval forces.
At the outbreak of the present war and up to the time when the German methods of warfare had, by their reckless disregard of all the principles of law hitherto recognized and all the dictates of ordinary humanity, made it necessary to adopt by way of retaliation measures calculated to cut off all German trade, it was open to neutrals to continue to supply the civil population of that country openly by consignments to named merchants and dealers in Germany, and if that course had been adopted the case would have assumed a very different complexion, and it would then have been, no doubt, for the British Government to establish that the consignees in fact were known to be engaged in supplying the German Government. This, however, was not the course adopted by the Chicago packers. Vast quantities of lard, meat, bacon, and oils, far in excess of any possible requirements of the Scandinavian countries, were shipped to Copenhagen in part to named consignees but for the greater part to the packers’ own agents or their order, and it was from, the first claimed that all these consignments were shipped on, or with a view to, bona-fide sales to neutrals. From the evidence, however, of cablegrams and letters in the possession of the British Government which were ultimately produced in court, it was clear that the packers’ agents in these neutral countries, and also several of the consignees who purported to be genuine neutral buyers, were merely persons engaged by the packers on commission, or sent by the packers from their German branches, for the purpose of insuring the immediate transit of these consignments to Germany. The [Page 568] whole scheme was disclosed in a series of letters from a Hamburg correspondent of Messrs. Cudahy, who was obviously in touch with the representatives in Hamburg and Rotterdam of practically all the packers. Agents and managers were sent from Germany to Copenhagen, where they established themselves in hotels; two of these agents formed themselves into a Danish importing company who had an enormous trade; the importance was emphasized of using the names of persons already in the provision trade; neutrals were induced, for a consideration, to lend their names as pretended consignees; careful instructions were given as to the names to be inserted in the bills of lading and other documents; and these agents kept the packers informed from time to time as to the prohibitions against export in the various neutral countries and as to the ports (including Genoa) to which it was most desirable to ship the goods. Some agents were found, on special instructions, to be moving about from place to place in Europe; and in one case the name of a German agent was in the cables changed to the innocent name of “Davis” when it was discovered that the original name was regarded as suspicious by the British censorship. The telegram showed orders given from Rotterdam for delivery to Copenhagen and Scandinavian ports, from Copenhagen for delivery to Swedish and Norwegian ports, and from Rotterdam and Copenhagen for delivery to Genoa; so that it obviously mattered little what the port ox delivery was so long as it was conveniently situated for transit to Germany. Offers were, on special instructions, made in German currency, for the convenience, obviously, of German buyers. There were clear indications of consultation with the packers’ German houses as to the ports to which goods should be sent. A special cable code was invented as to which, however, nothing more was disclosed than that “Arnhem” meant “ship to Copenhagen.” Special and hastily devised arrangements were made for payment by the establishing of large credits in Scandinavian banks, arrangements which, from the urgency of the cables connected with them, were obviously no part of the ordinary course of the packers’ business; and in some cases there were payments which clearly came directly or indirectly from Germany and from the Deutsche Bank. Indeed, it was stated to Messrs. Cudahy by their Hamburg correspondent that German bankers had evidently accumulated large balances in New York, Rotterdam, and Copenhagen; and as to the object of this there could be no doubt. There were indications sometimes of insurance of the goods in Germany, sometimes of precautions taken to insure in other than German companies; but with a few unimportant exceptions, no insurance policies were produced. The Holland-America Line was seen to be refusing the packers’ shipments, for it required a guarantee against reexport to Germany which they could not give; and at an early stage the line was approached with a proposal that it should, for the convenience and greater safety of the packers, transfer some of its vessels to the American flag, a proposal to which it declined to accede. The consequence was that a special line was formed to engage in this trade. In spite of all this the pretense was stoutly kept up to the end that the whole business was bona-fide neutral trade, and that the packers had no interest beyond that of selling and consigning to neutral [Page 569] buyers; and it was not till the actual trial that the admission was made on behalf of some of them that a large part of the goods was probably intended to go through to Germany. And there were strong indications that it was not merely a civilian German destination which was contemplated.
The German ports to which the goods were going, Hamburg, Lübeck, and Stettin, were all military or naval depots and headquarters of troops; the fat bacon, besides being of value for army rations was, as the British Government were informed, in such demand in Germany as being the raw material of glycerine, which is the most important constituent of explosives; the meat was packed suitably for army use, and indeed the case of the smoked bacon and Armour’s tinned boiled beef was of the kind supplied or offered to the British Army; and on the case put forward by the packers, it was necessary to imagine that while engaged in supplying the armies of Great Britain, France, and Russia, they had by some inexplicable oversight omitted to turn their attention to the opportunities for enormous profits offered by Germany and Austria. Messrs. Cudahy’s Hamburg correspondent expressly stated with regard to the cargo on the four ships whose cases were tried, that this information was that most of the goods had long ago been sold to Germany. He reported that Messrs. Morris’s German agent was sceptical about the release of the Alfred Nobel cargo, as it was “too open-faced a case of the lard being intended for Germany,” and that apparently this same German agent had suggested that the packers should make “a big noise” in the American press; and the picture drawn in these frank communications was one of German agents eagerly awaiting the release of their goods and calculating the prospects of their being promptly passed through Danish and Scandinavian ports to Germany. Yet in spite of all this the claim was put forward and firmly maintained to the end that everything that had been done was perfectly bona-fide trade, but documents, which could easily have been produced had this been true, were never forthcoming.
With perhaps a few minor exceptions the packers produced no contracts, no invoices, no insurance policies, and no cheques or other proof of sale or payments; their affidavits were in the most general terms and were put in at the very last moment, some of them even after the trial had begun, and no attempt was made by any written or other evidence to explain away the damning evidence of the telegrams and letters disclosed by the Grown. The inference was clear and irresistible that no such attempt could be made, and that any written evidence there was would have merely confirmed the strong suspicion, amounting to a practical certainty, that the whole of the operations of shipment to Copenhagen and other neutral ports were a mere mask to cover a determined effort to transmit vast quantities of supplies through to the German and Austrian armies. It is claimed, therefore, that the seizure of all the cargoes was amply justified by the facts known at the time, the facts subsequently discovered and disclosed, and the conduct of the packers throughout, and that the British Government required to call in aid nothing but the long-recognized and elementary principles of international law.