The Chargé in Great Britain (Laughlin) to the Secretary of State
[Received June 1—3:30 a.m.]
10360. Your 7973, May 28.15 Foreign Office informs me that they had under consideration with Procurator General question of release of American goods placed in Prize Court before entry of the United States in the war, and still awaiting adjudication. Foreign Office states that they considered both sides of the question, that is, goods shipped from the United States, and release of enemy goods now in Prize Court and understood to have been purchased by Americans. Foreign Office entirely sympathized with desirability of utilizing these materials to the best advantage. They are anxious to meet your views as far as possible, and are soon to give Embassy a formal reply to its representations. In the informal note in which the [Page 615]above appears, however, Lord Robert Cecil16 says there is one point which causes difficulty; a considerable portion of the goods of both classes noted above are in the category of those intercepted under order of March 11, 1915. Cecil says in deference to wishes of Washington, Foreign Office would be willing to release these goods, whether inward or outward bound, to American claimants in all cases where they can be shown clearly not to be property of enemy subjects. He goes on to say that if the Foreign Office does this, however, they abandon the opportunity of justifying seizure in Prize Court, and feels this could hardly be done if there remains a possibility of Foreign Office being faced on some future date with claims based on alleged invalidity of order in council and illegality of seizures under it. Cecil says he realizes Department could hardly be expected to withdraw formally from the attitude it adopted in earlier stages of the war toward order in council. He believes, however, that it is not unreasonable for Foreign Office to ask that if they comply with a request based on different circumstances now existing, the Foreign Office should not be exposed to subsequent claims of nature suggested above after they relinquish their right to press for a judicial decision in Prize Court. He adds American Government will doubtless appreciate that since their entry into the war, they have derived full benefit of British restrictions, which have resulted in shortage of essential commodities in enemy countries and curtailment of enemy trade in neutrals.
He concludes that Foreign Office would be quite satisfied with an informal intimation from the Ambassador that this point would not cause difficulty, and that if this intimation were forthcoming he believes Foreign Office would be able to release all goods on litigation [information?] submitted by the Ambassador, or their proceeds if these goods have already been sold, subject to release being accepted in full discharge of any control [claim?] which might be made in Prize Court. An exception is made, however, as to certain contraband shipments such as those of K. and E. Neumond as in such cases the evidence of intention to assist enemy is so overwhelming that it would be out of question for Foreign Office to abandon proceedings. If, however, any goods in these cases were required by American Government for military purposes and if they are still available, it is probable Foreign Office would place them at disposal of American authorities. As soon as I receive formal reply I shall telegraph it entire. Please inform me what position Department assumes on points raised by Lord Robert, particularly as to informal intimation mentioned by him in order that I may make a suitable answer to his note.