in 1881, laid it down "as a rule of universal acceptance and practice" that a "person voluntarily entering into a contract with the government of a foreign country or with the subjects or citizens of such foreign power, for any grievances he may have or losses he may suffer resulting from such contract, is remitted to the laws of the country with whose government or citizens the contract is entered into for redress."15 The government of the United States has not only always refused to use any other means than its good offices for the collection of such claims, but it has not concealed the fact that it "cannot but regard with great anxiety the attempt of a foreign government to compel by force the payment of mere contract debts due subjects of such governments by a South American state."16

II. THE CONDUCT OF THE ALLIES IN THE LIGHT OF INTERNATIONAL LAW.

In the preceding part of this discussion, an attempt was made to classify and discuss the claims of England and Germany against Venezuela in the light of certain well-established principles of international law. It is the purpose of the writer now to discuss the methods employed by the allies in enforcing their claims and to criticise their conduct in particular instances.

The general principles laid down were that "ordinarily, or as a general rule, no indemnity is due to foreigners for injuries which they may receive on his territory from belligerent action, or from insurgents whom he could not control," and that "the subjects of foreign powers domiciled in a country in a state of war (or insurrection) are not entitled to greater privileges or immunities than the other inhabitants of the insurrectionary district." Certain exceptions to these rules were, however, admitted17 under which head some of the claims of the allies undoubtedly fall.18

15 Mr. Blaine, Secretary of State, to Mr. Logan, 1881, in Wharton's Digest, II, § 231.

10 Mr. Frelinghuysen, Secretary of State, to Mr. Lowell, 1883, in Wharton's Digest, II, § 232.

17 See above, p. 255.

18 Up to the present time no state has admitted, unless by way of exception, any obligation to indemnify even its own subjects for

In attempting to secure redress or justice, foreigners should in the first instance have recourse to the local or territorial tribunals of the district in which they are domiciled, or, as Vattel1o puts it, to the "judge of the place." Local remedies should first be exhausted before resorting to diplomatic means of obtaining redress; but this rule "does not apply where there is no local judiciary, or where the judicial action is in violation of international law, or where the test is waived, or where there is undue discrimination." "It does not apply to countries of imperfect civilization, or to cases in which prior proceedings show great perversion of justice"; "but such denial of justice must be definitely shown."20

injuries or losses sustained during a period of war or insurrection. Such claims were ruled out by the United States government in respect to losses inflicted upon British subjects by the Confederate authorities during the Civil War (see Moore on Arbitration, I, p. 684), although a mixed commission was instituted after its close for the consideration of claims arising out of captures by United States cruisers, arbitrary arrests, compulsory military service, and other alleged violations of the personal rights of British subjects. A similar convention was also concluded with France. A commission or Court of Claims was also established at Washington in 1868 to examine the claims of American citizens and foreigners based upon losses or acts of spoliation suffered during the Civil War in consequence of the conduct of the Federal authorities. Indemnities for similar claims have been granted by European states, notably by France, but it is universally admitted that there is no obligation in this matter.

29 Book II, Chap. 8, § 103. Cf. Book II, Chap. 6, §§ 72 and 73.

"Wharton's Digest, II, §§ 241 and 242, espec. p. 695. Calvo, the great South American publicist, seems to be the only great authority on international law who refuses to admit these exceptions. He denies categorically that a government is responsible by way of indemnity for any losses or injuries sustained by foreigners in time of civil war or internal troubles. "To admit the principle of indemnity," he says, "would be to create an exorbitant and fatal privilege essentially favorable to powerful states and injurious to weaker nations, to establish an unjustifiable inequality between natives and foreigners." It would be an attack on one of the essential elements of the independence of nations, viz: that of territorial jurisdiction. "This," he says, "is the real significance of this frequent recourse to the diplomatic method of settling disputes which by their nature and surrounding circumstances belong to the exclusive domain of the ordinary courts." Calvo, III, $ 1280, p. 142. Cf. § 1297 and Vol. VI, § 256. The doctrine of Calvo does not, however, seem to have found any support outside of Latin

Let us now consider the methods adopted by the Allied Powers in enforcing their claims. It appears from the "Correspondence respecting the Affairs of Venezuela," presented to the British Parliament in February, 1902, that it was mainly a series of attacks on the liberty and property of British subjects culminating in the seizure of the “Queen” on the high seas and the confiscation of that vessel by the Venezuelan government21 which finally led the British government to address a formal protest to that of Venezuela on July 30, 1902. The Venezuelan government was informed that unless it "promptly pay to the injured parties full compensation wherever satisfactory evidence has been furnished to His Majesty's government that such is justly due, His Majesty's government will take such steps as may be necessary to obtain the reparation which they are entitled to demand from the Venezuelan government in these cases," etc.22 In reply to these demands, the Venezuelan government stated that some of the cases mentioned had already been settled, that others were on the road to settlement (i. e., to be decided ex parte by the Venezuelan government), but that the Venezuelan government had decided to postpone its reply to all such representations in consequence of the partiality towards the revolutionists displayed by the government of Trinidad, and pending a settlement

America. Its acceptance might leave foreigners in certain localities without any protection whatever against injustice or oppression. On the other hand, it must be admitted that diplomacy seems to give an undue advantage to stronger against weaker states. Differences of this nature should always be settled by mixed commissions or courts of arbitration. In order to make the necessary arrangements for these, resort to diplomacy or negotiation is, however, absolutely necessary.

The principle of irresponsibility has been incorporated in a number of treaties between South American and European states with each other. It was incorporated in the resolutions of the Pan-American Congress which met at Washington in 1889 and in the Constitution of Venezuela adopted in 1893. See report presented by M. Brusa to the Institut de Droit International for 1898 in Annuaire, p. 121; article by M. de Bar in Revue de Droit International for 1899, t. 29, p. 469, and Pradier-Fodéré, I, § 205, p. 347.

"See "Blue Book" on Venezuela, No. 108, pp. 126-129, for a list of these seizures.

"Ibid., No. 110, p. 129, and No. 122, p. 138.

relative to the "Ban Righ" question.28 This position was maintained by Venezuela in spite of another communication from Great Britain. This attitude on the part of Venezuela finally led to the ultimatum of December 7, 1902. In this ultimatum the British government demanded of the Venezuelan government that it recognize in principle the justice of all well-founded claims. These are to include those of the bondholders and the civil war claims, as well as the shipping claims and those which had arisen in consequence of the maltreatment or false imprisonment of British subjects. In these last-named cases immediate payment was demanded; but in respect to other classes of claims, the British government announced that it was willing to accept the decisions of a mixed commission as to the amount and security for payment.24

The memorandum prepared by the Imperial Chancellor on the subject of Germany's claims against Venezuela,25 states that "as the result of numerous applications the Venezuelan government issued a decree on January 24, 1901, by which a commission consisting solely of Venezuelan officials was to decide upon all claims." That decree, he says, was unsatisfactory because (1) all claims originating before the presidency of Senor Castro were ignored; (2) any diplomatic protest was precluded; (3) payments were to be made with bonds of a new revolutionary loan, which, in the light of previous experiences, would evidently be almost worthless. All attempts to get the decree altered failed, and the Imperial government refused to recognize it. Similar declarations were made by the governments of Great Britain, the United States, Italy, Spain, and the Netherlands. "But as Venezuela insisted that foreigners could not be treated differently from Venezuelan subjects, and that the claims must be considered as coming within the scope of internal

23 Ibid., No. 123, pp. 139-140.

"For the text of the ultimatum and a very amusing reply, see the Par. "Blue Book," cited above, No. 217, pp. 187-189.

* See London Times (weekly edition) for December 12, 1902. Cf. Communication, dated December 7, 1902, of Von Pilgrim-Baltazzi, German Charge d'Affaires to German Minister of Foreign Affairs in New York Times for December 14, 1902.

affairs, the Imperial government examined the German claims itself, and, so far as they appeared well-founded, made the Venezuelan government responsible for them." Venezuela finally declined all further discussion, claiming that the settlement of foreign war claims by diplomatic means was out of the question. "That," the chancellor exclaims, "is not in accordance with international law."

As a result of this attitude on the part of the Venezuelan government, "and as in the last civil war Germans had been treated by the Venezuelan government troops with especial violence," the Imperial Charge d'Affaires at Caracas handed to the Venezuelan government on December 7, 1902, an ultimatum demanding the immediate payment of some 1,700,000 bolivares or $340,000, the amount of the civil war claims of Germany up to the year 1900. To these were added the claims of German firms for the building of a slaughter-house at Caracas and those of the German Great Venezuelan Railroad Company, as well as a demand for the fixing and guaranteeing of the amount of the claims arising out of the recent civil war.

It will thus be seen that Venezuela, acting in accordance with the Calvo doctrine which she appears to have incorporated in her own constitution and laws,26 insisted upon an ex parte settlement of the claims of the allies by her own authorities. She refused even to discuss the complaints of Great Britain until her own grievances relative to the "Ban Righ" question and the conduct of the British colonial authorities at Trinidad had been settled. In the absence of complete and definite knowledge respecting the character and degree of guilt of the British government and its agents in these matters, it is impossible to say whether the

26

See the Constitution of 1893. Article II of the new law bearing on the rights of foreigners submitted to the Venezuelan Congress by President Castro in March, 1902, declares that "foreigners shall have no right to resort to the diplomatic channel, except when having exhausted all legal means before the competent authorities, it clearly appears that there is a denial of justice or notorious injustice." This law seems to make concessions which Calvo himself was not prepared to make. For the text of this law, see Current History for June, 1902, Vol. XII, p. 316.