I believe that the teaching of the latter school of thought is correct[2] ] since International and Municipal Law differ as regards their sources, the relations they regulate, and the substance of their law. Rules of International Law can, therefore, only be applied by Municipal Courts in their administration of the law in case and in so far as such rules have been adopted into Municipal Law either by a special Act of the legislature, or by custom, or implicitly.
Now the practice of the Courts[3] ] of the United States neither agrees with the doctrine of the former nor with the doctrine of the latter school of publicists, but takes a middle line between them. Indeed it considers International Law to be part and parcel of the Municipal Law of the United States. It is, however, far from accepting the maxim that International Law overrules Municipal Law, it accepts rather two maxims, namely, first, that International Law overrules previous Municipal Law, and, secondly, that Municipal Law overrules previous International Law. In the administration of the law American Courts hold themselves bound to apply the Acts of their legislature even in the case in which the rules of these enactments are not in conformity with rules of previous International Law. It is true that, according to Article VI of the American Constitution, all international treaties of the United States shall be the supreme law of the land, but in case an Act of Congress contains rules not in agreement with stipulations of a previous international treaty, the American Courts consider themselves bound by the Act of Congress, and not by the stipulations of the previous treaty. It is obvious that, according to the practice of the Courts of the United States, International Law and Municipal Law are of equal force, so that on the one hand new rules of International Law supersede rules of previous Municipal Law, and, on the other hand, new rules of Municipal Law supersede rules of previous International Law. For this reason, the American Courts cannot be resorted to in order to have the question decided whether or no the enactments of Section 5 of the Panama Canal Act are in conformity with Article III, No. 1, of the Hay-Pauncefote Treaty.
It is a proof of the bona fides of President Taft that he desired that the American Courts might be enabled to decide this question. In a message to Congress, dated August 19, 1912, in which the President stated his conviction that the Panama Canal Act under consideration did not violate the Hay-Pauncefote Treaty, he inter alia suggested that Congress should pass the following resolution:—
"That nothing contained in the Act, entitled 'An Act to provide for the opening, maintenance, protection, and operation of the Panama Canal, and the sanitation and government of the Canal zone,' shall be deemed to repeal any provision of the Hay-Pauncefote Treaty or to affect the judicial construction thereof, and in any wise to impair any rights or privileges which have been or may be acquired by any foreign nation under the treaties of the United States relative to tolls or other charges for the passage of vessels through the Panama Canal, and that when any alien ... considers that the charging of tolls ... pursuant to the provisions of this Act violates in any way such treaty rights or privileges such alien shall have the right to bring an action against the United States for redress of the injury which he considers himself to have suffered; and the District Courts of the United States are hereby given jurisdiction to hear and determine such cases, to decree their appropriate relief, and from decision of such District Courts there shall be an appeal by either party to the action of the Supreme Court of the United States."
Congress, however, has not given effect to the suggestion of the President, and the American Courts have not, therefore, the opportunity of giving a judicial interpretation to the Hay-Pauncefote Treaty and of deciding the question whether or no through the Panama Canal Act has arisen a conflict between American Municipal Law and International Law as emanating from the Hay-Pauncefote Treaty.
IX.
It has been asserted that the United States is bound by her general arbitration treaty of April 4, 1908, with Great Britain to have the dispute concerning the interpretation of the Hay-Pauncefote Treaty decided by an award of the Permanent Court of Arbitration at the Hague. It is, however, not at all certain that this dispute falls under the British-American Arbitration Treaty. Article I of this treaty stipulates:—
"Differences which may arise of a legal nature or relating to the interpretation of treaties existing between the two contracting parties and which it may not have been possible to settle by diplomacy, shall be referred to the Permanent Court of Arbitration established at the Hague by the Convention of the 29th of July 1899, provided, nevertheless, that they do not affect the vital interests, the independence, or the honour of the two contracting States, and do not concern the interests of third parties."
Since this stipulation exempts from obligatory arbitration such differences between the contracting parties as concern the interests of third parties, the question requires an answer whether in the controversial interpretation of the Hay-Pauncefote Treaty other States than Great Britain and the United States are interested. The term interest is, however, a very wide one and so vague that it is very difficult to decide this question. Does "interest" mean "rights"? Or does it mean "advantages"? If it means "advantages," there is no doubt that in the Panama Canal conflict the interests of third parties are concerned, for the free use of the Canal by their vessels on terms of entire equality is secured to them by the Hay-Pauncefote Treaty. On the other hand, if "interests" means "rights," it can hardly be said that the interests of third parties are concerned in the dispute, for the Hay-Pauncefote Treaty is one to which only Great Britain and the United States are contracting parties, and according to the principle pacta tertiis nec nocent nec prosunt no rights can accrue to third parties from a treaty. Great Britain has the right to demand from the United States, which owns and controls the Canal, that she shall keep the Canal open for the use of the vessels of all nations on terms of entire equality, but other States have no right to make the same claim. The case will be different when the Canal has been opened, and has been in use for such length of time as to call into existence—under the influence and working of the Hay-Pauncefote Treaty—a customary rule of International Law according to which the Canal is permanently neutralised and open to vessels of all nations, or when all maritime States, through formal accession to the Hay-Pauncefote Treaty, have entered into it with all rights and duties of the two contracting parties. So long as neither of these events has taken place Great Britain and the United States can at any moment, without the consent of third States, abrogate the Hay-Pauncefote Treaty and do away with the stipulation that the Canal shall be open to vessels of all nations on terms of entire equality.