Department of State to recede from its rigorous position of declining interposition where the claim originated in a contract.1

Equitable considerations alone, however, have rarely induced any stronger action than the use of good offices.

6. Where a definite arrangement for the liquidation of the claim has. been made between the alien and the government, it will generally be enforced by diplomatic pressure, notwithstanding its contractual origin.2

§ 115. Arbitration.

7. Whatever hesitation there may have been on the part of the Executive to interpose diplomatically in behalf of citizens injured through the breach of a contract concluded with a foreign government, the Department of State has generally been willing to submit contract claims to the adjudication of international commissions, and these commissions have in general exercised jurisdiction over contract claims as over other claims. In instructions given by Mr. Pickering on Octo

3

1 Mr. Evarts, Sec'y of State, to Sir E. Thornton, May 2, 1879, Wharton's Dig. II, 658; see also correspondence between Mr. Fish and Mr. Thomas in 1874 in the Landreau case v. Peru, Moore's Dig. VI, 714–715.

2 Lord John Russell, British Foreign Sec'y, to Sir C. L. Wyke, Mar. 30, 1861, 52 St. Pap. 238, quoted also in Moore's Dig. VI, 719; Claim of Waring Brothers, railroad contractors (Gt. Brit.) v. Brazil, in which Great Britain insisted on the carrying out by Brazil of a decree which appropriated an indemnity for the loss sustained by Waring Brothers due to the government rescinding the contract. Moore's Dig. VI, 720-721, For. Rel., 1887, 54, 55. Sparrow claim v. Peru, For. Rel., 1895, II, 10361055; 1896, 492-494. The French claims against Venezuela liquidated under the convention of June 29, 1864, Moore's Dig. VI, 711-712. See also the settlement of the claim of W. R. Grace (U. S.) v. Peru, in which the failure of the government to carry out a judgment against it was construed as a denial of justice warranting diplomatic intervention. Mr. Neill to Mr. Hay, Sec'y of State, Nov. 19, 1903, For. Rel., 1904, 678.

3 Contract claims have been submitted to general mixed commissions dealing with general claims (as, for example, the U. S.-Mexican commissions of 1839 and 1868, the U. S.-Venezuelan commissions of 1885 and 1903 and many others) and to special commissions instituted to decide single claims (as, for example, the claim of Metzger & Co. (U. S.) v. Haiti, October 18, 1899, Day, Arbitrator, For. Rel., 1901, 262-276, and that of the San Domingo Improvement Co. (U. S.) v. Dominican Republic, Jan. 31, 1903, For. Rel., 1904, 270. See also Bordes (France) v. Chile, 1897, La Fontaine, 618 (award unpublished); Freraut (France) v. Chile, July 3, 1897, LaFontaine, 579. General mixed commissions have assumed jurisdiction of contract claims under the customary inclusive terms of the protocol "all claims," and even "claims" arising out of "injury to person or property of citizens."

ber 22, 1799, to the American plenipotentiaries to France, the envoys were directed to secure the adjustment of "all claims" of citizens of the United States against that government, and among these there were expressly enumerated the "sums due" to American citizens by contracts with the French government, or its agents.1

By the convention between the two countries of April 30, 1803, for the "payment of sums due" by France to citizens of the United States, provision was made for the satisfaction of "debts." 2 In the treaty of February 22, 1819, between the United States and Spain, by which each government renounced "all claims" of its citizens or subjects against the other government, Mr. Adams, Secretary of State, considered that contract claims had been included among those renounced.3 Mr. Adams added that there was no doubt of the right of the government to include such claims in the provisions of the treaty.

Practically all international commissions, where the terms of submission in the protocol could be construed as sufficiently broad, have exercised jurisdiction over contract claims, for example, the United States-Spanish Commission of February 22, 1819, the three Mexican commissions of April 11, 1839, of March 3, 1849 (domestic) and of July 4, 1868, the United States-British Commission of February 8, 1853 and August 18, 1910, the United States-Peruvian Commission of January 12, 1863, the United States-French Commission of January 15, 1880, the United States-Venezuelan Commission of December 5, 1885, the Venezuelan Commissions of 1903 sitting at Caracas, and many others. A conflict arose in the commission of July 4, 1868, due to the 1 Am. St. Pap., For. Rel., vol. 2, 242, 301, 303; see also Moore's Dig. VI, 707–708. 2 Moore's Dig. VI, 708.

3 Moore's Dig. VI, 717-718; Moore's Arb. 4502-4505.

* See Moore's Dig. VI, 718; Ralston, Report of Venezuelan Commissions; Moore's Arb. 3425-3590; J. Hubley Ashton, agent of the United States before the Mixed Commission with Mexico of July 4, 1868, in an elaborate argument in the case of the State Bank of Hartford (No. 535) and other similar cases, opposing a motion to dismiss for want of jurisdiction over contract claims, analyzed carefully the practice of the United States and the jurisdiction of international commissions in the matter of contract claims, especially under a protocol submitting "all claims . . . arising out of injuries to . . . person or property." He cited decisions of municipal courts and international tribunals to show that under the terms "all claims" and "injuries" breaches of contract were included. Among others he cited decisions of the commissions under the treaty with Spain, 1819 (8 Stat. L. 258); with Great Britain, 1853

difficulty of reconciling vacillating opinions with proper judicial action. Commissioners Wadsworth, Palacio and Umpire Lieber (though the latter was not always consistent) had allowed claims on contracts concluded between citizens of the United States and agents of Mexico for the furnishing of arms, munitions, and other material to the Mexican government, on the ground that the failure to pay for such goods constituted an "injury" to the "property" of an American citizen under the terms of the protocol. The Mexican commissioner, Palacio, while adhering to the view of his colleagues that contract claims were within the jurisdiction of the commission, believed that a demand and refusal of payment was a condition precedent to the allowance of the claim. Subsequently, upon the death of Dr. Lieber and the resignation of Commissioner Palacio, Sir Edward Thornton became umpire and Señor Zamacona the Mexican commissioner. Thereupon a different view was taken as to the jurisdiction of the commission over contract claims. Sir Edward Thornton considered that he ought to follow the practice of the Executive of exercising discretion in assuming jurisdiction of contract claims, for which reason, while admitting the jurisdiction of the commission over contract claims, he declined to allow such as were based upon voluntary contract, in the absence of clear proof of the contract and proof that gross injustice had been done by the defendant government. The decisions of the commission, therefore, are at times contradictory, claims of exactly the same nature having been allowed by Wadsworth, Palacio and Lieber, and rejected when Zamacona became the Mexican commissioner and Thornton the umpire.1

(10 Stat. L. 998); with New Granada, 1857 (12 Stat. L. 985); with Costa Rica, 1860 (12 Stat. L. 1139); with Colombia, 1864 (13 Stat. L. 685); with Ecuador, 1862 (13 Stat. L. 633); with Peru, 1863 (13 Stat. L. 639); with Venezuela, 1866 (16 Stat. L. 316), and with Peru, 1868 (16 Stat. L. 349). He also mentioned the three Mexican commissions. The argument is on file in the Department of State Library.

1 A full discussion of this perplexing question before the commission was undertaken by Commissioner Wadsworth in the case of Treadwell & Co. (U. S.) v. Mexico, July 4, 1868, quoted at length in Opinions of the Commission, vol. 4, 248, and vol. 7, 383. The claims were allowed in the cases of Manasse, Moore's Arb. 3462-3464; Iturria, ibid. 3464; Moses, Assignee, ibid. 3465; Newton, ibid. 3465; Morrill, ibid. 3465, and were disallowed by Thornton, umpire, in cases of supplies furnished, services rendered and other claims based on voluntary contract in the Phipps case, ibid.

1

There have been occasions when general international commissions have not exercised jurisdiction over contract claims. It was agreed by the United States and Spain in the claims convention of February 12, 1871, that the arbitrators were not to have jurisdiction of claims growing out of contract.2

3

Where jurisdiction has been exercised by mixed commissions, as is the general rule, the contract has been examined as would any other instrument open to judicial construction. Among other factors the authority of the person contracting as agent for the government is always closely examined. The general rules of agency are applied,4 although municipal courts have made distinctions between cases in which the government rather than a private individual is the principal. A contract for unneutral service will as a general rule not be enforced either by municipal 5 or international courts. There have been a 3468; Treadwell, ibid. 3468; Pond, ibid. 3467; Nolan, ibid. 3484; Light, ibid. 3484. Wallace, ibid. 3475; Kennedy & King, ibid. 3474; State Bank of Hartford, ibid. 3473; Shumaker, ibid. 3472; Chase, ibid. 3469; Kearney, ibid. 3468; Sturm (dictum), ibid. 2756; Dennison, ibid. 2766; De Witt, ibid. 3466; Widman, ibid. 3467. Lieber's decision in disallowing the claim of Thore de Lespes for the hire of a steam tug to Mexico (ibid. 3466) is inconsistent with his other opinions.

6

1U. S.-British Mixed Commission of May 8, 1871. See Hubbell (U. S.) v. Great Britain, Moore's Arb. 3484-6; Hale's Rep. 40; Howard's Rep. 160, 752, 754. 2 Agreement of Feb. 11-12, 1871, art. 15, Moore's Arb. 4802-4803.

3 Turnbull, Manoa, Limited, Orinoco, et al. (U. S.) v. Venezuela, Feb. 17, 1903, Ralston, 244, where Barge held a certain contract void ab initio. See also American Electric and Manufacturing Co. (U. S.) v. Venezuela, Feb. 17, 1903, Ralston, 250, where Barge held a promise to declare void an existing contract as an illegal promise. See also Frear (U. S.) v. France, Jan. 15, 1880, Moore s Arb. 3488-3491; Boutwell's Rep. 202, where it was found that the claimant had not performed the contract on his part.

Lew Wallace (U. S.) v. Mexico, July 4, 1868, Moore's Arb. 3475–3476, in which case the Mexican agent had acted beyond the scope of his authority, for which reason the contract was held not binding on Mexico. See also Beales, Nobles & Garrison case (U. S.) v. Venezuela, Dec. 5, 1885, Moore's Arb. 3548–3564. In Zander (U. S.) v. Mexico, March 3, 1849, Moore's Arb. 3433, the failure to show the original authority of the agent or the subsequent ratification of his acts by the government barred the claim. In Trumbull (Chile) v. United States, Aug. 7, 1892, an award was made on the ground that claimant had a right to assume that the United States minister in engaging his legal services was authorized so to do; see supra, p. 183.

5 Kennett et al. v. Chambers, 14 How. 38; Du Wurtz v. Hendricks, 9 Moore's C. B. Rep. 586; see also Kent's Commentaries, I, 116.

* Cucullu (U. S.) v. Mexico, July 4, 1868, Moore's Arb. 3478–3479; Fitch (U. S.) v.

few occasions where international commissions on the ground of equity or waiver of the illegality have made awards on unneutral contracts. This is especially so where the political party aided was successful or became at least a de facto government.1

The domestic commission under the Act of March 3, 1849, held that while the United States was not justified in pressing a claim growing out of services in violation of the claimant's neutrality as a citizen of a neutral nation, yet if Mexico, the nation against whom such claim existed, sees proper to waive the objection and agrees to recognize the claim, the tribunal cannot assume for it a defense expressly waived.2

Speculative contracts are not enforced.3 The service itself where of an extraordinary character, such as the giving of advice in battle, has been held not measurable in money damages, but calling rather for a monument or some other mark of national gratitude. While it has been noted that as a general rule a claim for voluntary services is not pressed by the Department of State, international commissions, with the exception of the United States-Mexican Commission of 1868 after Thornton became umpire, have not hesitated to allow damages for services thus rendered. They have occasionally held, however, that a demand for payment must be made upon the debtor government.5 Mexico, July 4, 1868, ibid. 3476-3477; Wallace (U. S.) v. Mexico, July 4, 1868, ibid. 3475-3476.

1

1 Lake (U. S.) v. Mexico, July 4, 1868, Moore's Arb. 2755, Opinion by Palacio, Commissioner; Chew (U. S.) v. Mexico, April 11, 1839, ibid. 3428, and other cases there cited; Hunter, Duncan et al. (U. S.) v. Mexico, April 11, 1839, Moore's Arb. 3427; Cucullu (U. S.) v. Mexico, July 4, 1868, ibid. 3478-3479; claims of Stephen Codman, No. 86, and John and Robert Gamble, No. 1783, were allowed by the mixed commission under the treaty with Spain of 1819, cited in Ashton's argument, supra.

2 Meade (U. S.) v. Mexico, Act of March 3, 1849, Moore's Arb. 3430, 3432. Other commissions have held that only the nation whose laws have been violated can waive the illegality, and not the state aided by the unneutral act.

Taussig (U. S.) v. Mexico, July 4, 1868, Moore's Arb. 3472–3473, where the nonfulfillment of a contract for the sale of vessels, etc., to a government, said vessels having been purchased as a speculation on their subsequent sale, was held not to be an injury to person or property within the meaning of the protocol. See also Oliva (Italy) v. Venezuela, Feb. 13, 1903, Ralston, 780; see also American Trading Co. v. Chinese Indemnity Fund, 47 Ct. Cl. 563, 569.

4 O'Dwyer (U. S.) v. Venezuela, Dec. 5, 1885, Moore's Arb. 3568.

Cucullu (U. S.) v. Mexico, July 4, 1868, Moore's Arb. 3483. Palacio in a dictum