(k.) This may be called the end of the second stage of the history of the negotiations. It commenced with an intimation from Great Britain that a proposal from the United States would be listened to. In its progress negotiations were opened, which ended in a convention providing for the submission of claims of citizens of the United States against Great Britain, including the Alabama claims. This convention, in the opinion of Lord Granville, admitted unlimited argument as to what the Alabama claims were. The Treaty was rejected by the Senate of the United States, because, although it made provision for the part of the Alabama claims which consisted of claims for individual losses, the provision for the more extensive national losses was not satisfactory to the Senate. It is clear that, by this time, if not before, the phrase "Alabama claims" was understood on both sides as representing all the claims against Great Britain, "growing out of" its conduct toward the United States during the insurrection. A portion of these claims had been, throughout the discussions by Mr. Seward and Mr. Adams, grounded on the unnecessary Proclamation recognizing the insurgents as belligerents. The remainder rested on the acts of the cruisers. All were alike known as Alabama claims.

Mr. Motley informs the United States do not abandon the national claims.

Lord Clarendon that

which

At this stage of the history, General Grant became President. On the 15th of May following Mr. Fish instructed Mr. Motley to say to Lord Clarendon that the United States in rejecting the Treaty "abandoned neither its own claims nor those of its citizens." Again, on the 25th of the following September, Mr. Motley was instructed by Mr. Fish in a dispatch, of which a copy was to be given to Lord Clarendon, to say that the President concurred with the Senate in disapproving the convention had been rejected; that "he thought the provisions of that convention were inadequate to provide reparation for the United States, in the manner and to the degree to which he considered the United States were entitled to redress;" but that "he was not prepared to pronounce on the question of the indemnities which he thought due to individual citizens of the United States * nor of the reparation which he thought due by the British Government for the larger account of the vast national injuries it had inflicted on the United States." 2

*

And that the John

son-Clarendon

con

vention did not afford

sufficient redress for

the national injuries.

The indirect claims

Lord Clarendon.

In an elaborate paper styled "Observations" upon Mr. Fish's dispatch to Mr. Motley, of the 25th of September, 1869, which was appended to Lord Clarendon's dispatches of November 6, as considered by 1869, to Sir Edward Thornton, the subject of the national, now called indirect, claims was fully considered in a way which must satisfy the Arbitrators that the British Government understood the nature, character, and extent of those claims. It is difficult when reading these observations, and the dispatch which called them out, to understand how Lord Granville could commit himself to the statement, in one of his recent dispatches, that "There was not a word in any letter preceding the Treaty to suggest any indirect or constructive claims; and the only intimation the British Government had had was from the speech of Mr. Sumner."3

It seems to us that these incidents are decisive of the whole controversy.

(1) In the following December the President thus alluded to the subject in his annual message to Congress :

1 Am. App., vol. vi, p. 1.

2 Ibid., p. 13.

3

Appendix to British Case, vol. iv, No. 1, p. 19.

sage

December, 1869.

The provisions [of the Treaty] were wholly inadequate for the settlement of the grave wrongs that have been sustained by this Government as well as President's mes. by its citizens. The injuries resulting to the United States by reason of to Congress, the course adopted by Great Britain during our late civil war; in the increased rates of insurance, in the diminution of exports and imports, and other obstructions to domestic industry and production; in its effects upon the foreign commerce of the country; in the decrease of the transfer to Great Britain of our commercial marine; in the prolongation of the war; and the increased cost (both in treasure and lives) of its suppression; could not be adjusted and satisfied as ordinary commercial claims which continually arise between commercial nations. And yet the convention treated them simply as such ordinary claims, from which they differ more widely in the gravity of their character than in the magnitude of their amount, great as is that difference.

And still again, in his annual message to Congress in December, 1870, the President referred to the subject with similar precision and particularity of statement, as cited in a previous part of the present Argument.1

Same in 1870

claims were under

stood to include all

Britain, both national

and individual.

It cannot, therefore, be doubted that, in the beginning of the year In January, 1871, 1871, it was well understood by both Governments that the the words Alabama United States maintained that Her Majesty's Government claims of the United Ought, under the laws of nations, to make good to them the States against Great losses which they had suffered by reason of the acts of all thecruisers, typically represented by the Alabama-whether those losses were caused by the destruction of vessels and their cargoes; by the prolongation of the war; by the transfer of the commerce of the United States to the British flag; by the increased rates of insurance during the war; by the expense of the pursuit of the cruisers; or by any other of the causes enumerated in the President's message to Congress in 1869. Nor can it be doubted that they intended to reserve the right to maintain the justice of all these claims when opportunity should offer, nor that they regarded all these several classes of losses as embraced within the terms of the general generic phrase "Alabama claims." It is also equally clear that the claims for compensation founded upon the Queen's Proclamation were abandoned by President Grant.

Negotiations open

(m) At that time, the condition of Europe induced Her Majesty's Ministers to consider the condition of the foreign relations of ed at Washington. the Empire. They found that their relations with the United States were not such as they would desire to have them; and they induced a gentleman, who enjoyed the confidence of both Cabinets, to visit Washington for the purpose, in a confidential inquiry, of determining whether those relations could be improved. 2

Reasons which in

(n) It was not the first time that Great Britain had had duced those negotia cause solicitously to ask herself whether she might not have need of the good will of the United States.

tions.

At the opening of the war between France and Great Britain on the one hand, and Russia on the other, the Emperor Napoleon found himself greatly embarrassed by England's traditional attitude of exigency toward neutrals, so contrary to the traditional policy of France. The Foreign Minister, M. Drouyn de Lhuys, labored in correspondence with the British Government to induce the latter to relinquish her own policy and accept that of France. To effect this object, the great lever employed by M. Drouyn de Lhuys was the apprehension entertained in Great Britain of the possible attitude of the United States. He explains the matter as follows:

Ce qui touchait particulièrement le gouvernement anglais, c'était la crainte de voir l'Amérique incliner contre nous et prêter à nos ennemis le concours de ses hardis vo1 Ante, p. 18. 2 Statement by Lord Granville, Hansard, vol. cevi, p. 1842.

1

lontaires. La population maritime des États-Unis, leur marine entreprenante, pouvaient fournir à la Russie les éléments d'une flotte de corsaires, qui, attachés à son service par des lettres de marque, et couvrant les mers comme d'un résean, harcèleraient et poursuivraient notre commerce jusque dans les parages les plus reculés. Pour prévenir ce danger, le cabinet de Londres tenait beaucoup à se concilier les bonnes dispositions du gouvernement fédéral. Il avait conçu l'idée de lui proposer, en même temps qu'au gouvernement français et à tous les états maritimes, la conclusion d'un arrangement, ayant pour but la suppression de la course et permettant de traiter comme pirate quiconque, en temps de guerre, serait trouvé muni de lettres de marque. Ce projet, qui fut abandonné dans la suite, témoigne de l'inquiétude éprouvée par les Anglais.1

How M. Drouyn de Lhuys worked on this state of mind of the British Government appears by the following extract from a dispatch from him to the French Minister at London, M. Walewski:

Les États-Unis enfin sont prêts, je ne saurais en douter, à revendiquer le rôle que nous déclinerions et à se faire les protecteurs des neutres, qui eux-mêmes recherchent leur appui. Le cabinet de Washington nous propose en ce moment de signer un traité d'amitié, de navigation et de commerce, où il a inséré une série d'articles destinés à affirmer avec une autorité nouvelle les principes qu'il a toujours soutenus et qui ne diffèrent pas des nôtres. Le principal secrétaire d'état de sa Majesté britannique comprendra que nous n'aurions aucun moyen de ne pas répondre favorablement à l'ouverture qui nous est faite, si la France et l'Angleterre, bien que se trouvant engagées dans une même entreprise, affichaient publiquement des doctrines opposées. Que les deux gouvernements, au contraire, s'entendent sur les termes d'une déclaration commune, et nous pouvons alors ajourner l'examen des propositions des États-Unis. Il me paraît difficile que ces considérations ne frappent pas l'esprit de Lord Clarendon.2

These and like representations on the part of M. Drouyn de Lhuys, induced Great Britain to come to an arrangement with France.

(0) Not insensible to such motives, Lord Granville, pending the late war between France and Germany, dispatched a confidential agent to America to re-open negotiations with the United States.

ence.

This gentleman arrived in Washington early in January, 1871, and found the Government of the United States so disposed to Preliminary propomeet the advances of Her Majesty's government that, before sals and correspondthe end of the month, Sir Edward Thorton was able to propose to Mr. Fish "the appointment of a Joint High Commission "treat of and discuss the mode of settling the different questions which have arisen out of the fisheries," &c.3

to

the Alabama claims.

Mr. Fish replied, accepting the proposition upon condition that "the differences which arose during the Rebellion in the United The proposed com States, and which have existed since then, growing out of mission to treat of the acts committed by the several vessels which have given rise to the claims generically known as the 'Alabama claims,' should also be "treated of by the proposed Joint High Commission."4 Sir Edward Thornton, on the 1st of February, answered that "it would give Her Majesty's Government great satisfaction if the claims were submitted to the consideration of the same High Commission."5 The President of the United States, under the provisions of the Constitution, nominated to the Senate for its approval five United States comcommissioners to serve in the Joint High Commission on the missioners appointed part of the United States, and transmitted to the Senate correspondence, and the correspondence between Mr. Fish and Sir Edward by it." Thornton, to explain the proposed duties of the nominees. Upon this explanation the Senate gave its assent to the several appointments; and thereupon the appointees each received a commission authorizing him "to treat and discuss the mode of settlement of the different ques

1 Drouyn de Lhuys, Les neutres pendant la guerre d'Orient, p. 14. 2 Ibid., p. 28.

3 Brit. App., vol. iv, paper ii, p. 1.

and confirmed on the

their powers limited

4 Ibid.

5 Ibid., p. 3.

tions which shall come before the said Joint High Commission." The British Commissioners received a broader power, which was stated to be conferred upon them "for the purpose of discussing in a friendly spirit" "the various differences which have arisen" between Great Britain and the United States, "and of treating for an agreement as to the mode of their amicable settlement.”

Taking these powers and the correspondence between Mr. Fish and Sir Edward Thornton together, it is evident that each Government contemplated that all the differences between the two Governments within the range of the correspondence were to be discussed with a view to reaching a mode of settlement.

Among the Commissioners named on the part of the United States was Mr. Fish, the Secretary of State, one of the parties to the preliminary correspondence which led to the Treaty; and among those on the part of Great Britain was Sir Edward Thornton, the other party to that correspondence.

(p) The subject of the Alabama claims was opened at the fourth conference by an elaborate statement from the American commissioners.2

The Alabama claims.

The American com

their understanding

of those words.

They stated that "in consequence of the course and conduct of Great Britain during the Rebellion" the United States had missioners state sustained a great wrong, and had also suffered "great losses "the meaning of and injuries upon their material interests." Thus, in the outset, they drew a distinction between certain political differences which had been the subject of some correspondence between the two Governments, and the material losses and injuries which could be estimated and indemnified by pecuniary compensation. They then went on to state their views more in detail as to such losses and injuries.

In order to bring them within the letter of the correspondence, and to define their understanding of the meaning of the language there used by Mr. Fish and by Sir Edward Thornton, they began by tracing these losses and injuries to the Alabama and the other cruisers. They said that "the history of the Alabama and other cruisers which had been fitted out, or armed, or equipped, or which had received augmentation of force in Great Britain, or in her 'colonies,' showed the losses and injuries for which they are claiming indemnification."

They then said that the damage which they had suffered from these injuries was two-fold: 1st. That which had proximately resulted from the acts of the cruisers, "the capture and destruction of a large number of vessels with their cargoes," and "the heavy expenditures in the pursuit of the cruisers ;" and 2d, other injuries resulting less directly, though not less certainly-namely, "the transfer of a large part of the American commercial marine to the British flag," "the enhanced payments of insurance," "the prolongation of the war," and the addition of a large sum to the cost of the war, and the suppression of the rebellion."

Thus Mr. Fish, one of the parties to the preliminary correspondence, and his colleagues, explained to Sir Edward Thornton, the other party to the correspondence, and to his colleagues, that the history of the cruisers showed all these losses and injuries; in other words, that they all grew out of the acts of those cruisers.

The American Commissioners next expressed their conviction that the history of the cruisers showed "that Great Britain, by reason of failure in the proper performance of her duties as a neutral, had become justly liable for the acts of those cruisers and of their tenders."

1 Brit. App., vol. iv, paper xii, p. 6.

2 Ibid., p. 8.

a

mode of ascertaining

They then turned to the consideration of the damage which the United States had suffered from this class of injuries. They They propose stated the amount of the claims for the destruction of private the amount of the property which had up to that time been presented. They damages. indicated a manner in which the amount of the expenses for the pursuit of the cruisers could be ascertained. They added that they had not yet made an estimate of the other damages less proximately resulting from the injuries complained of, because they "hoped for an amicable settlement." This, however, was not to prejudice them "in the event of no such settlement being made." They thus distinctly declared that these classes of injuries also were capable of being estimated and pecuniarily indemnified; and they reserved the right to claim such indemnity.

And that payment

They closed their elaborate statement by proposing that the desired amicable settlement should be made within the walls of the room in which the conference was held, by means of an thereof should be agreement "upon a sum which should be paid by Great Britain to the United States in satisfaction of all the claims and interest thereon."

made.

This would have been an amicable settlement;

Such an arrangement, in connection with the other provisions of the Treaty, would indeed have constituted a settlement, and an amicable one. It would have been a settlement, because, being a discharge of the obligation, it would have ended all controversy. It is not an amicable settlement, it is not in any sense a settlement, to engage in a protracted lawsuit, as the two Governments have been constrained to do, in consequence of the British Government refusing to enter into the amicable arrangement proposed by the United States.

It has been asserted that this proposal was a "waiver" of the claims classed as "indirect." So far from that being the case, the But no waiver of proposal contemplated that the payment of a gross sum any class of claims. was to be made and accepted as a "satisfaction of ALL the claims." Such a payment and such an application of the payment are utterly inconsistent with the idea of a waiver of any of the claims.

The attitude of Mr. Fish on this occasion, and of the other American Commissioners, was in perfect accord with the constant previous attitude of the American Government, as explained by Mr. Seward in his dispatch to Mr. Adams of January 13, 1868.1

Lord Stanley seems to have resolved that the so-called Alabama claims shall be treated so exclusively as a pecuniary commercial claim as to insist on altogether excluding the proceedings of Her Majesty's Government in regard to the war from consideration in the Arbitration which he proposed. On the other hand, I have been singularly unfortunate in my correspondence if I have not given it to be clearly understood that a violation of neutrality by the Queen's proclamation, and kindred proceedings of the British government, is regarded as a national wrong and injury to the United States.

The British commissioners without delay declined the The proposal deAmerican proposal for an amicable settlement.

clined;

Without exception to the definition of the term "Alabama

Sir Edward Thornton, the other party to the preliminary correspondence, and his colleagues, listened without objection to Mr. Fish's definition of the sense in which the phrase "Alabama claims" had been used in that correspondence; nor did claims." they at any time take exception to it, or propose to limit it. On the contrary, they expressly declined to reply in detail to the statement of the American Commissioners.

1 Am. App., vol. iii, p. 688.