Rejoinder of the party claimant.

The Government of the United States of America has the honor to submit to the honorable arbitrator, Mr. Asser, the hereunto annexed rejoinder to the counter-memorandum of the Imperial Government of Russia, in the cases of American vessels Game Horn Pigeon, James Hamilton Lewis, C. H. White, and Kate and Anna, now under arbitration.

The party claimant notes that the defendant party recognizes that an indemnity is due in the Cases I and IV; that is to say, the Cape Horn Pigeon and the Kate and Anna; therefore the sole remaining question to be solved in these two cases is the amount of indemnity due to party claimant, and furthermore that in justice interest at the rate of 6 per cent per annum on the entire sum awarded, from the day these damages were caused to the party claimant until the day of payment of indemnity, is due.

The defendant party, in its general reference to the conditions under which the seizure of the vessels in question took place, advances certain statements which relate to negotiations of the United States Government concerning the protection of fur seals in the Pacific Ocean. Whatever may be the bearing of that question upon the seizure of the three other vessels, it can in no way be applied to the Cape Horn Pigeon, which was only engaged in whale fishing in the Sea of Okhotsk and had no thought of seal fishing.

It is true that the United States Government entered into negotiations with the Governments of Great Britain and Russia for the purpose of preventing the destruction of seals in the North Pacific Ocean, and to that end proposed to the two Governments the adoption of a temporary modus vivendi, pending the decision of the Paris Tribunal concerning the several questions to be arbitrated between the United States and Great Britain. Unfortunately the Imperial Government found it impossible to unite with the Government of the United States and that of Great Britain in agreeing upon a modus vivendi.

Had it done so the three Governments might have acted in unison for the suppresion of fur-seal fishing pending the decision of the Paris tribunal.

By the terms of the modus vivendi, which was agreed upon in 1891, each of the contracting parties, the United States and Great Britain, took upon itself to prohibit its respective citizens and subjects from seal fishing in certain waters beyond the ordinary territorial limits pending the decision of the Paris tribunal regarding the limits of the jurisdiction of the United States in those waters. This prohibition of seal fishing in said waters became a temporary municipal law of each of the two powers concerning their respective subjects or citizens, but it should not, and indeed could not, be imposed by either Government upon the citizens of the other. By special agreement the right was [Page 320] respectively conferred upon these Governments each to arrest subjects of the other found violating this municipal law, but with the express stipulation that the persons and vessels thus seized should be handed over to the authorities of the country to which they respectively belong for trial and punishment. At the expiration of this modus vivendi in 1892 a new understanding was arrived at between the two Governments in a revised modus vivendi, by the terms of which it was agreed that if the claims of the United States to an extended jurisdiction in the waters of Bering Sea were not sustained by the tribunal of Paris, the United States Government would indemnify the subjects of Great Britain for abstaining from fur-seal fishing pending the decision of said tribunal, and the amount of such indemnity should be founded on the probable catch which the vessel might have made during that period.

Copies of these two conventions are hereunto annexed and submitted in evidence, marked respectively Exhibits “A” and “B,” and reference is made to them, not only as supporting the points herein expressed in reply to the counter-memorandum, but as international conventions bearing directly upon the subject of the present arbitration and in support of the demands of the party claimant, especially as to the question of the loss of time of the seized vessels, and the amount of damage thus sustained through the loss of a probable catch.

These special and limited conventions of a purely temporary nature between the Governments of the United States and Great Britain surely can not be interpreted as conferring upon the Government of Russia rights over citizens of the United States and their property which neither of the high contracting parties possesses over the other.

If, however, the defendant party takes the ground that this modus vivendi gave it particular rights for the temporary protection of the fur-seal fisheries, according to which it was permitted to seize and punish violators of this municipal law in waters beyond the ordinary maritime jurisdiction, then it can not escape the obligations imposed upon the United States in the modus vivendi of 1892 to indemnify for losses in case the Paris tribunal should decide, as it did, that no country possesses territorial rights in Bering Sea beyond the limits of ordinary maritime jurisdiction. The modus vivendi, nevertheless, while it accorded certain rights and privileges, imposed also certain responsibilities, and the defendant party can not now, after refusing to unite with the other high contracting parties and to share the responsibilities, claim to-day rights and privileges which would exceed those enjoyed by the contracting parties themselves.

The quotation from the modus vivendi was made by the defendant party as being applicable in the case of the present arbitration, but the party claimant protests against the application of this special and private convention between two contracting parties as a rule of conduct for a third party unless it be accepted in its entirety. Therefore if the modus vivendi is really applicable as a rule of conduct for the defendant party, it was obliged on seizing the vessels, the cargoes, and the crews to hand them over to the United States Government as soon as practically possible, and in default of having done so—depriving these citizens of the United States of their interest in the use of their property and preventing the officers and crew from making their living in their own way, according to the very spirit of the modus vivendi—the defendant party becomes responsible for the loss occasioned [Page 321] these claimants, measured by a just estimate of the probable catch of the vessels in question.

As for the last modus vivendi, which the defendant party cites as being applicable to these cases, the party claimant protests against the consideration of this citation. The terms of the protocol deny specifically all retroactive force, and recourse may not be had to this modus vivendi to justify these seizures made by another party before its existence.

One head of damages set up by the party claimant which relates to all of the four cases of this arbitration, and the justice of which the defendant party vigorously disputes, is that of the loss of catch.

Many precedents have been cited by the party claimant in support of this claim, but the modus vivendi of 1892, which the defendant party cites as relating to the present arbitration, gives still more force to the argument of the party claimant that the loss of the catch is the true measure of damage for loss of service of the seized vessel. Article V of this convention says specifically that if the decision of the tribunal should be adverse to the claims of jurisdiction advanced by the United States as to the extent of said jurisdiction over the waters of Bering Sea the latter shall indemnify the subjects of Great Britain for abstaining from the exercise of their right to engage in seal fishing in these waters, measured by the catch which said subjects might have made.

The defendant party, according to the argument contained in its counter memorandum in the case of the Cape Horn Pigeon, admits the loss of profits as measure for damages for the loss of service of the vessel, but expresses the opinion that “this last should be taken in the sense of deprivation of a determined income, or else of a certain profit to be derived from holdings in question. For instance, in the case of appropriating the property of another, or of damages occasioned a vessel laden and on the point of departure” continuing, that the case in question is an enterprise subject to risks which might result in the loss of the property of the participants. The party claimant maintain that such distinctions have not the least bearing upon the obligation of the defendant party to make restitutio in integrum for the illegal detention of the citizens and vessels of the party claimant. To deprive a person of the use of his property, which represents to him the tool of the workman, and to deprive him of the use of it in his legitimate business does, according to all principles of equity, give him the right to indemnity for such deprivation of his property. The profits which he could reasonably expect from the use specified is the sole measure of damage sustained by him in the deprivation of his property. The question of possible risk or danger of the enterprise has no bearing on the responsibilities incurred by interruption or by seizure. The possibility of losses enters into all commercial enterprises, and above all in navigation at sea. The vessel laden and ready to go to sea is quite as liable to disaster at sea as the one awaiting a cargo, and all hope of profit in commercial enterprises may prove deceptive. The two enterprises, whaling and sealing, are recognized as legitimate, for which there is always capital to be invested, and the interruption of these enterprises has been admitted in international arbitrations as a subject for indemnification on the basis of the loss of catch, as has been cited in the memorandum of the party claimant, namely, in the decision of the “Alabama claims,” in the arbitration of the claims of Great [Page 322] Britain against the United States for seizures made in Bering Sea, and in the sentence of the arbitrator in the case of Costa Rica Packet.

The defendant party cited the decision of the arbitration tribunal on the cases known as the “Alabama claims” as establishing the principle of not allowing indemnity for claims for indirect damages. The indirect damages excluded by the tribunal at Geneva in adjudication of the “Alabama claims” were the loss in the transfer of the American merchant marine to the English flag: additional payments for insurance; the prolongation of the war; and the addition of a large sum to the expense of the war, and the suppression of the rebellion.

Furthermore, in the case of the whalers James Maury, General Pike, Milo, and Nile, seized by the Confederate States cruiser Shenandoah, for whose acts the Tribunal of Geneva found Great Britain responsible, damages specifically stated to be in lieu of loss of catch were allowed by the Court of Claims. The decision of the court in these four cases has been cited in the memorandum.

The amount of claims submitted by the Government of Great Britain for the seizure by Russia of the Canadian schooners Willie Magowan and Ariel, cited by the defendant party, has no bearing whatever on the question of amount of damages preferred here. That the English Government claimed and received or did not claim and did receive all of the indemnity for these seizures to which it was entitled can in no way affect the justice of the claims here presented nor furnish a precedent in the adjudication. These negotiations constitute a private agreement between the Governments of Russia and Great Britain.

The indemnity here claimed for loss of the catch is not in the nature of future benefits, but for the loss of the use of their property and the means of livelihood of which these claimants were deprived. They are entitled to restitutio in integrum. This could only be accomplished by restoring their property and their rights at the time and place of the seizure or in allowing them a compensation for the deprivation to which they were subjected. The latter is the only means to which it is now possible to resort. The measure of damages suffered through such deprivations can only be estimated upon the basis of the profit which the claimants could expect from the business they were engaged in.

One principle of the claim common to the three cases is that for the seizure and detention of the officers and crew of the vessels, and the bad treatment experienced by them, the estimate of which the defendant party finds excessive.

In further support of these claims, the party claimant submits the official report of the correspondence and of the action of the United States in the case of the arrest of the Russian subject, Gustav Isaak Dahlberg, master of the bark Hans, hereunto annexed and marked Exhibits “C” and “D,” respectively.

Dahlberg was arrested and detained five days and, when it was demonstrated that his arrest was not legal, the United States Government paid him an indemnity of $5,000, which sum was proposed by the Russian Government as being satisfactory. This will demonstrate that the sums claimed under this head by the parties interested in the present arbitration are far from being exaggerated.

In each case of the present arbitration the defendant party has cited in the counter-memorandum the note of the United States ambassador dated January 27 (February 8), 1899 (Exhibit T of the Cape Horn [Page 323] Pigeon), in which, in the hope of settling these cases promptly terms of compromise settlement were proposed by the United States.

For the purpose of discrediting the bonus fides of these claims, the defendant party in making this citation in each case draws a comparison between the sums proposed by way of compromise without adding the interest, which naturally would be due at the time of settlement, and the amounts of the claims as they are at present shown, with interest added.

The party claimant protests against the citation or the consideration of the offer of settlement in such manner. The party claimant has entirely and specifically safeguarded all possible interpretation of abandonment of his rights to recover the entire amount of the claims.

The offer was made for a distinct and specific purpose, and not having been accepted by the defendant party, it can not now be cited as affecting in any way whatsoever the amount of indemnity to be recovered.

The counter-memorandum being, according to the terms of the protocol, the only argument of the defendant party to which the party claimant is permitted to reply, should be understood as representing all the defense of the defendant party except in that which concerns the argument on the present rejoinder of the party claimant, and therefore, as it is not open to the party claimant to rebrat new testimony or to refute the application of new citations or of new arguments on the memorandum, the party claimant respectfully submits to the honorable arbitrator that no new testimony or arguments on the part of the defendant party should be admitted in the arbitration except to rebut the new facts, arguments, and citations contained in the present rejoinder.