bankruptcy proceedings, after the concession was destroyed by the closing of the port of El Triunfo and the grant of the franchise to strangers? Said Mr. Fish to minister Foster: Justice may as much be denied when it would be absurd to seek it by judicial process as if denied after being so sought. Again, this is not a case of the despoliation of an American citizen by a private citizen of Salvador, on which, on appeal to the courts of Salvador, justice has been denied the American national, nor is it a case where the rules applying to that class of reclamations, so numerous in international controversies, have to do. This is a case where the parties are the American nationals and the Government of Salvador itself as a party to the contract; and in this case, in dealing with the other party to the contract, the Government of Salvador is charged with having violated its promises and agreements by destroying what it agreed to give, what it did give, and what it was solemnly bound to protect. Some one of the most respected authorities in international law, Lewis Cass, has laid down the undoubted rule and its exception, as broad as the rule, when he says that When citizens of the United States go to a foreign country, they go with an implied understanding that they are to obey its laws and submit themselves in good faith to its established tribunals. When they do business with its citizens, or make private contracts there, it is not to be expected that either their own or the foreign government is to be made a party to this business or these contracts, or will undertake to determine any dispute to which they give rise. * * * The case is widely different when the foreign government becomes itself a party to important contracts, and then not only fails to fulfill them, but capriciously annuls them, to the great loss of those who have invested their time, labor, and capital in their reliance upon its good faith and justice. a In any case, by the rule of natural justice obtaining universally throughout the world wherever a legal system exists, the obligation of parties to a contract to appeal for judicial relief is reciprocal. If the Republic of Salvador, a party to the contract which involved the franchise to El Triunfo Company, had just grounds for complaint that under its organic law the grantees had, by misuser or nonuser of the franchise granted, brought upon themselves the penalty of forfeiture of their rights under it, then the course of that Government should have been to have itself appealed to the courts against the company and there, by the due process of judicial proceedings, involving notice, full opportunity to be heard, consideration, and solemn judgment, have invoked and secured the remedy sought. It is abhorrent to the sense of justice to say that one party to a contract, whether such party be a private individual, a monarch, or a government of any kind, may arbitrarily, without hearing and without impartial procedure of any sort, arrogate the right to condemn the other party to the contract, to pass judgment upon him and his acts, and to impose upon him the extreme penalty of forfeiture of all his rights under it, including his property and his investment of capital made on the faith of that contract. Before the arbitrament of natural justice all parties to a contract, as to their reciprocal rights and their reciprocal remedies, are of equal dignity and are equally entitled to invoke for their redress and for a Wharton's Digest, section 230. their defense the hearing and the judgment of an impartial and disinterested tribunal. It follows that the Salvador Commercial Company and the other nationals of the United States who were shareholders in El Triunfo Company, as hereinbefore named, are entitled to compensation for the result of the destruction of the concession and for the appropriation of such property as belonged to that company, excepting such property as was accumulated and constructed under the terms of the concession, to be vested in and owned by the Republic, to the extent of the interests of such American citizens in said concession and such property. Under the terms of the protocol and by the accepted rules of international courts in such cases, nothing can be allowed as damages which has for its basis the probable future profits of the undertaking thus summarily brought to an end. Notwithstanding the evidence of the computable rate of increase of earnings and profits from the beginning until the end of the first half of 1898, and although the concession by its terms still had twenty-one years to run, yet we are precluded by the rule mentioned from assuming that the rate of profits would increase during the remainder of the term in the same ratio, or at all, or even that it would continue to earn at the rate actually shown by the evidence of Salvador itself, heretofore cited. If on the tangible evidence for the assessment of the valuation of the franchise we give its value, in our view we can give nothing even for the cost of the buildings and structures erected by the capital of the company which, by the terms of the franchise, were to become the property of the Republic. Neither can we give any award for the expenditure made through the procurement of the company by the United States in the survey and charting of Jiquilisco Bay and its entrance, however much such structures and such survey may add to the permanent wealth of the Republic of Salvador. On the clear and certain evidence before us, without involving ourselves in speculation, but computable on the uncontradicted and direct evidence presented, we find the value of the franchise, computed without reference to future or speculative profits or any speculative or imaginary basis whatever, to be $750,000. We think also that damages should be awarded for the value of the steamer Celia, less the balance of her purchase price, which remained unpaid at the closing of the business of the company. We find also that the value of the property of the company taken and left in Salvador, which was not the property of the Government, as before stated, but which was exclusively the property of the company, to be $45,000. We are of opinion that the claimants before this tribunal are entitled to recover costs and reasonable attorneys' fees. Attorneys and counsel have been employed to obtain relief from the Government of Salvador before the intervention of the Government of the United States was invoked. Since intervention eminent counsel have been employed whose residence and places of business are in California, and these, since the latter part of 1899, have been almost constantly employed in this matter both at Salvador and at Washington, at distances far remote from their places of residence and business. These expenses have been exclusively borne by the Salvador Commercial Company. Before intervention by the United States they disbursed in that behalf, according to the evidence, irrespective of attorneys' fees, $2,671.31 in an effort to secure rehabilitation of El Triunfo Company. After intervention by the United States the expenses of prosecuting this reclamation, borne by the Salvador Commercial Company, exclusive of all attorney and counsel fees, have been, according to the evidence, $18,864.77. We are of opinion that fair compensation for such attorneys and counsel employed after intervention, including their services rendered at the capital of Salvador and at Washington, is $60,000. Of the valuation of the franchise, of the damages for the Celia and the property taken as above stated, we think the Government of the United States is entitled to recover, for the behoof of its nationals involved in this matter, each its or his proportion in accordance with the number of shares held in Triunfo Company, Limited; and as those shares were divided into 1,000 of $100 each, each of the American citizens, including the Salvador Commercial Company, will be entitled, through the Govern ment of the United States, to receive of this award for such property such proportion of the amounts as the number of shares held by each bears to the total number of shares of the company. Aside from its share in the damages last mentioned, which would be represented by its 501 shares in El Triunfo Company, the Salvador Commercial Company is entitled to receive as a part of its damages all of the said expenses paid out and the attorney and counsel fees, in which the other stockholders, having contributed nothing, have no share. We have not discussed the question of the right of the United States under international law to make reclamation for these shareholders in El Triunfo Company, a domestic corporation of Salvador, for the reason that the question of such right is fully settled by the conclusions reached in the frequently cited and well-understood Delagoa Bay Railway Arbitration. The particulars and items of the damages found are definitely stated in the formal award and its schedule this day signed. HENRY STRONG. ARBITRATION OF CLAIM OF ROSA GELBTRUNK v. SALVADOR. Mr. Hay to Mr. Merry. No. 438.] DEPARTMENT OF STATE, Washington, January 11, 1902. SIR: I have to acknowledge the receipt of your dispatch" No. 608, of August 24, 1901, inclosing a copy and translation of a note from the Government of Salvador contesting the claim of Mrs. Rosa Gelbtrunk against that Government for $22,654.43 for the seizure of merchandise at Sensuntepeque, Salvador, by revolutionary troops in November, 1898. The Department has given careful consideration to this claim. The revolutionists who made the seizure now constitute the Government of Salvador, which is therefore answerable for the full payment of the indemnity. The Government of Salvador denies liability, while a Not printed. not denying the seizure and appropriation of the property by the military forces of the Republic. The seizure is proved by the affidavits of a number of eyewitnesses, the evidence of title in the claimant is clear, and the value of the goods taken is shown by the certificate of two appraisers appointed by the court, one representing Gelbtrunk and the other the Salvadorean Government. Inasmuch as this claim is founded in the tortuous action of the State, the State is answerable for the payment of an indemnity, the amount of which seems to have been fairly established as above stated. The Government of the United States therefore expects the immediate payment of an indemnity in the amount of said claim. The claim is just beyond dispute, and for this reason it is hoped that it will be paid without further delay. As, however, the Department has accepted the principle of arbitration in the case of the Salvador Commercial Company, it is not unwilling that such principle shall apply also to this case, and that this claim shall be submitted to the same arbitrators as the claim of the Salvador Commercial Company is to be submitted to, provided the agreement to submit is made promptly. You will, accordingly, propose to the Salvadorean Government that the claim be submitted to arbitration as above suggested. I am, etc., JOHN HAY. No. 696.] * * Mr. Merry to Mr. Hill. LEGATION OF THE UNITED STATES, SIR: I have the honor to advise the receipt of a dispatch from the Salvador Government stating that it will accept our offer to arbitrate the Gelbtrunk claim for $22,654.43, jointly with that of the Salvador Commercial Company, provided it be allowed thirty days from the date upon which you accede to the request as notified to this legation by cable, this period being claimed as necessary to collect and translate the evidence which the Salvador Government desires to present. I presume that you will agree to the request regarding the Gelbtrunk claim, and, if agreeable, shall expect on receipt hereof your cablegram to that effect, which I shall promptly transmit to the minister of foreign affairs at San Salvador, the thirty days allowed commencing from the date of your cablegram to this legation. I respectfully forward herewith copy and translation of dispatch from the minister of foreign relations of Salvador conveying above request. With assurances, etc., WILLIAM LAWRENCE MERRY. [Inclosure.-Translation.] Mr. Trigueros to Mr. Merry. MINISTRY OF FOREIGN RELATIONS, MR. MINISTER: I have the honor to refer to your excellency's dispatch dated January 28 last, relative to the calling of the attention of this Government to the Gelbtrunk claim for $22,654.43, arising from merchandise taken by the troops of the Government, who, in your excellency's opinion, should be responsible for that amount, because, this claim being founded upon an unjust act of the State, this Government is responsible for the payment of an indemnity whose amount appears fully established. Your excellency adds that, having accepted arbitration in the case of the Salvador Commercial Company, you desire to apply the principle to this question and that the Gelbtrunk case be submitted to the same arbitrators as the claim of the Salvador Commercial Company, provided that this Government gives prompt consent, since otherwise your excellency advises having instructions to ask the early payment of that sum. In reply I have the honor to advise your excellency that my Government accepts the friendly proposition of the United States Government regarding the submission to the court of arbitrators who will act in the claim of the Salvador Commercial Company the matter of Mrs. Gelbtrunk, provided that there be granted to both parties a period of one month to present their proofs, a period that should count from the acceptance of this first request by the Government of your excellency, since my Government needs this fixed term to collect, prepare, translate into English, and to send to Washington to our lawyers some documents that should be proofs of its rights before the arbitrators. If your excellency accepts this period that I request, since that marked by Article III of the protocol of arbitration is about to expire, I beg that you will please advise by telegraph, if you approve, with the purpose that the term of thirty days to which I have made reference begins to count from that date. I am pleased to renew, etc., Mr. Hill to Mr. Merry. [Telegram.-Paraphrase.] JOSÉ TRIGUEROS. DEPARTMENT OF STATE, Washington, March 14, 1902. (Mr. Hill states that a delay of thirty days to present proofs for the arbitration of the Gelbtrunk claim in form requested by Salvador is granted; that this action closes the agreement to arbitrate the claim, and that proofs will accordingly be presented.) Mr. Merry to Mr. Hill. No. 698.] LEGATION OF THE UNITED STATES, San José, March 15, 1902. SIR: I have the honor to acknowledge the receipt of your cablegram dated March 14. On receipt thereof I sent a cablegram to the minister of foreign affairs of Salvador, copy of which please find herewith, and also copy of my dispatch to him on the same subject, which goes forward via Puntarenas by mail hence to-morrow. With the hope that this claim is now likely to receive a friendly solution in the near future, I remain, etc., WILLIAM LAWRENCE MERRY. [Inclosure 1-Telegram.] Mr. Merry to Mr. Trigueros. LEGATION OF THE UNITED STATES, The Washington Government concedes thirty days' period from the fourteenth of present month to present proofs for arbitration of Gelbtrunk case in manner requested by Salvador. This concludes arrangement to arbitrate this claim, and proofs will be presented accordingly. WILLIAM L. MERRY. |