[Footnote 55: For. Rel., 1900, p. 579; Choate to Hay, Feb. 2, 1900.]
The question might naturally have arisen whether there could be any basis for a claim for indirect loss sustained by an American shipper growing out of the sale on credit to citizens of the Transvaal. It might be a question, too, whether the consignor might, notwithstanding the seizures, be able to recover at law the full contract price of the goods shipped prepaid to the consignee, and if so, whether the seizure could be considered legally as a wrong against the American consignor. And even granting that the latter were unable to recover at law from the consignee, the question would still remain whether under all the circumstances such inability on the part of the American consignor could be legally imputable to the act of the British Government in making the seizure. The question might also have arisen where an agent had bought for the Transvaal Government on credit, so that the title passed when the goods went on board and the goods were discovered to have been contraband, whether an American shipper might not appear to have been privy to the real character of the purchases. In such a case the United States Government could hardly have championed the cause of a party who had shipped contraband. A prize court is filled with pitfalls of the kind, but the diplomacy of Secretary Hay, backed by the prestige of the United States and a reciprocal feeling of friendship between the two nations, was able to avoid all such questions by inducing Great Britain to agree upon a settlement without compelling the claimants to go into the prize court. Although it was pretty well ascertained that no actual contraband in the usual sense of the term had been carried from America by the ships which were seized, difficult questions were thus avoided as between liens and general ownerships which might have arisen had American shippers been compelled to go into court.
It is not a universal rule where the shipper has not been paid for his goods that the property is still in him, so as to constitute him the owner in a prize court, or for the purposes of sale. By the terms of sale and shipment he may not have retained a lien on the goods. But in any case as a rule the title of the absolute owner prevails in a prize court over the interests of a lien holder, whatever the equities between consignor and consignee may be.[56] Consequently the policy adopted by Secretary Hay in demanding that Great Britain should settle with all American shippers on an equitable basis without forcing them to take their chances in a prize court was the wisest course that could have been pursued.
[Footnote 56: The Winnifred, Blatch. Prize Cases, 2, cited 2 Halleck,
International Law, Engl. Ed. (1893), 392.]
In the final arrangement Great Britain admitted that the American goods had not been liable to seizure except as a result of the libel attaching to the ships. But any claims for damages due to the owners of the cargoes on account of the failure of the vessels to deliver at the port mentioned in the freight contract, it was asserted, should be made against those who entered into or became responsible for the execution of the contract for the delivery which they failed to perform, and the assumption that such damages could be sustained at law would depend on the terms of the contract of carriage. The English Government, however, did not admit that it was in any way liable for damages to the owners of the flour and other goods, since their detention was due entirely to the circumstance that the ships were not able to complete their voyages, and the fact that they could not complete their voyages was due to the circumstance that such voyages were illegal by the law of the flag under which they were sailing.[57]
[Footnote 57: For. Rel., 1900, pp. 604-605; Salisbury to Choate, March 3, 1900.]
Although the financial settlement which Great Britain was willing to make was accepted by the United States, this acceptance did not imply an acquiescence in the view expressed by the English Government with reference to the conditions under which flour and other foodstuffs might become contraband of war, nor in the doctrine of continuous voyages as applied by Great Britain to trading with the enemy. It was preferred at Washington to follow the usual rule and avoid passing upon hypothetical cases until occasion had called them into actual existence. The problem which had been before the Department of State was, not to force Great Britain to declare herself finally upon broad questions of international law, nor to express the final attitude of the United States upon questions which were not immediately at issue, but to meet the demands of American shippers and secure their immediate interests by some equitable agreement with Great Britain. The arrangement agreed upon, therefore, met only the necessity of the case immediately in view. The United States Consul-General at Cape Town was to arrange with Sir Alfred Milner, the British High Commissioner in South Africa, for the release or purchase by the British Government of any goods owned by citizens of the United States, which, if purchased, were to be paid for at the price they would have brought at the port of destination at the time they would have arrived there had the voyage not been interrupted.
Against certain articles, especially the oil consigned to the Netherlands South African Railway, an allegation of enemy's property was justly made and the oil confiscated.
In the end most of the American claims were withdrawn or paid in full. In the former event the American owners threw the burden of proof of ownership upon the consignees, who were instructed to present their claims through their respective governments. But it should be noted that in acceding to the American demands by purchasing the goods, the British Government emphasized the fact that the act was purely ex gratia on the part of England. The British representative clearly stated that the goods had been legally detained and that it was open for the owners to come and take them upon proof of ownership before the prize court. It was pointed out that the fact that none but British ships ran between Cape Colony and Delagoa Bay, although an unfortunate circumstance, was one which could hardly be held to be a fault of the English Government. The enforcement of the English law was the right of Great Britain no matter upon whom the inconvenience might happen to fall. Lord Salisbury said: "It must be distinctly understood that these payments are made purely ex gratia and having regard to the special circumstances of this particular case. No liability is admitted by Her Majesty's Government either to purchase the goods or to compensate … for the losses or for the expenses … incurred."[58] The view held by the English statesman was that Great Britain's concession in these cases should not serve as a precedent in the future.
[Footnote 58: For. Rel., 1900, p. 618; Salisbury to Choate, July 20, 1900, with reference to the Beatrice.]