Foreign Relations of the United States Diplomatic Papers, 1932, The British Commonwealth, Europe, Near East and Africa, Volume II

411.60 d Finnish Vessels/107½

The Finnish Minister (Åström) to the Acting Secretary of State

Washington, May 3, 1932.

Sir: I have the honor to refer to the note of His Excellency, the Secretary of State, of February 18, 1932, regarding the claims for compensation and damages against the Government of the United States for detention of certain Finnish sailing vessels during the period from March to June, 1918, presented by me on February [January] 27, 1928, in accordance with instructions from the Minister of Foreign Affairs of Finland, on behalf of the owners of the detained vessels.

After having communicated with the present Minister of Foreign Affairs of Finland, I have the honor, in accordance with instructions received from him, to resubmit the case with the following observations.

I have noted the conclusion of the Department of State that these cases present no violation of either municipal law of the United States or of the accepted principles of international law and that, therefore, there is no financial responsibility on the United States for the damages sustained by the owners of the vessels.

In addition, careful consideration has been given to the explanation following the State Department’s conclusion wherein is set forth the authority of the War Trade Board under the established law of the United States to refuse licenses to remove products of the United States during the war period and that in an effort to control all resources of the United States at that time the right of the American authorities to deny bunker licenses is not subject to question under international law and practice.

In reply I have the honor to call your attention to the fact that neither the Finnish citizens who have made claims for damages which have been suffered from the detention of their vessels nor the Government of Finland presenting their claims have intended to question the right of the authorities acting for the United States to control the export of resources or products of the United States, within the limits prescribed by local laws. These claims are not founded upon a denial of permits, the issuance of which was discretionary with officials of the United States under local law.

In order that the basis on which these claims are predicated may stand out more clearly, I beg to point out that it is the detention of the ships and not the refusal to permit the export of American products, for which the claims are made. It is the standpoint of the claimants and the Government of Finland that the refusal of the bunker licenses was only incidental to the main purpose of the American authorities, that is, the detention of the ships themselves, and was one means by which this purpose was made effective.

The evidence which has been submitted to the Department of State and which may be submitted before a tribunal at the proper time, will, I believe, show conclusively that the vessels were required by the American authorities to remain in American ports for the period from March to June, 1918, and there has been no evidence which indicates that there was any desire on the part of the American authorities to prohibit the exportation of American products or resources which these vessels proposed to remove from the United States. I am confident that you will find from the documents earlier submitted in this matter, among other things, that the restrictions imposed on the departure of the vessels were made effective by causing United States Marine guards to be placed on board the vessels and thus insure that there should be no movement of the vessels from this country, even without the carrying by these vessels of any American products.

Moreover, the investigation of the facts will show conclusively

(1) That the American authorities had approved the charter parties under which these vessels were to carry general cargoes and oil for an American corporation from the United States to South Africa and Australia;

(2) That the American authorities had granted licenses for the export of these cargoes;

(3) That at no time was there any denial of bunker licenses by the American authorities because of the desire to prevent the export of American products;

(4) That the American authorities even proposed to carry out the charter parties, provided the ships were chartered to the United States, or its agent, the United States Shipping Board; and

(5) That it was definitely stated by the American authorities to the American agents of the vessels who made application for bunker licenses that no Finnish ship would be permitted to leave the United States during the period covered by these claims.

In the light of the above facts, proof of which is readily available, it can be seen that these cases are not to be regarded as subject to disposition on the ground that the vessels entered American ports with knowledge that they might not be permitted to carry from American shores American products, which permission the American authorities, that is, the War Trade Board, was authorized to deny.

The Government of Finland, on behalf of the ship owners, does not seek any compensation from the United States because of a denial of bunker licenses which the authorities of the United States were authorized to control. Its claim refers to compensation for the denial of the right of the vessels to move, irrespective of the refusal of licenses to carry out bunkers and supplies for the contemplated voyages.

Under the accepted principles of international law, the claimants recognize the right of the United States, while engaged in war, to prevent these vessels from leaving an American port, if the American authorities regarded such action as essential to its conduct of the war, but provided that in exercising its right the United States shall make compensation to the owners of the vessels for the provable losses which have been suffered from the exercise of this right.

This principle of international law has frequently been stated and applied, not only by the United States Supreme Court, but by other tribunals throughout the world in controversies of this character.

It is my understanding that the United States has repeatedly insisted upon the application of this principle of international law and the right to compensation for damages when loss has been sustained by its citizens. It is the contention of the Government of Finland that the cases now under consideration call for the application of the accepted principle of international law, to which reference has been made. It is recognized that these cases present justiciable questions under international law which should properly be adjudicated, preferably by the Court of Claims of the United States.

It may be appropriate for me to remind the Department of State that the claims of the citizens of Finland, now being asserted, are not unlike the case of the Steamship Zeelandia,⁵ wherein the Department of State recommended to the Congress of the United States the enactment of suitable legislation which enabled citizens of the Netherlands, owners of the vessel Zeelandia, to have their claims for a detention of the vessel determined by the Court of Claims of the United States. Also, that these claims are not unlike the claims involving the two Swedish vessels, wherein the Department of State has more recently agreed to recommend to the Congress of the United States the enactment of suitable legislation for the arbitration of the claims of the owners of the M/S Kronprins Gustaf Adolf and Pacific.⁶

I have noted from the opinion of the Court of Claims in the Zeelandia case that the attitude of the Government of the United States toward claims of citizens of other countries has been expressed in a note to the Minister of Netherlands in the following words:

“This government (the government of the United States) is quite agreed that in a case presenting a question as to the responsibility of the United States for the damages toward an alien corporation as does that of the Zeelandia, the claimant, if invoking any principle of international law as applicable thereto, should have its day in court before a tribunal competent to pass on the contention and having ample jurisdiction to do so.”

The Government of Finland is confident that the Department of State in the interest of securing justice and fair treatment to the citizens of Finland will be willing to recommend that a similar privilege as extended to the citizens of the Netherlands, shall be secured to the Finnish ship owners.

In view of the above, I have the honor to request you to be good enough to cause the facts concerning these claims, and my correspondence with the Department, to be submitted to the Congress of the United States with a recommendation that, by a suitable Act of Congress, the Finnish owners of the vessels in question may be permitted to proceed to have their claims heard and determined by the Court of Claims of the United States.

Accept [etc.]

L. Åström

5. 73 Court of Claims 722.
6. See Foreign Relations, 1930, vol. iii, pp. 818 ff.