and collection made, renders unreasonable the subsequent exaction of payment by the titular government. This is due to the fact that obedience to the command of the insurgent party in a place subject to its control cannot be regarded as unlawful.2

(3)

§ 302. Acts of Successful Revolutionists.

A State is responsible for the acts of successful revolutionists, as their acts must be regarded as those of the government which they have established. This principle has met with general recognition.3

j

Contractual Claims against Foreign Governments

(1)

303. The Practice of Withholding Interposition.

Ever since the days of Madison the United States has been reluctant to interpose in behalf of a citizen seeking redress from a foreign State on account of its disregard of the terms of a contract

1 Mr. Black, Secy. of State, to Lord Lyons, British Minister, Jan. 10, 1861, MS. Notes to Great Britain, VIII. 383, Moore, Dig., VI, 995. Following the foregoing communication in response to an inquiry made by the British Minister as to what position the United States would take regarding the action of the authorities of South Carolina in exacting duties during the Civil War, Mr. Moore adds: "It may be superfluous to say that no claim for the repayment of duties thus exacted was ever made by the United States." Id., VI, 995. See, also, McLeod v. United States, 229 U. S. 416.

Mr. Hunter, Acting Secy. of State, to Mr. Scruggs, Minister to Colombia, Sept. 11, 1875, MS. Inst. Colombia, XVII, 2, Moore, Dig., VI, 995; Santa Clara Estates Company Case, British-Venezuelan Commission, 1903, Ralston's Report, 397; Guastini Case, Italian-Venezuelan Commission, 1903, id., 730; case at Bluefields, For. Rel. 1900, 803-824, Moore, Dig., VI, 684-688.

In correspondence with the Colombian Minister in 1885, Mr. Bayard, Secy. of State, pointed out the unreasonableness of imposing upon foreigners who had paid imposts to rebel forces, the burden of proof that positive coercion was resorted to against them. Communication of Dec. 11, 1885, For. Rel. 1885, 281, Moore, Dig., VI, 997.

2 Mr. Fish, Secy. of State, to Mr. Nelson, Minister to Mexico, Feb. 11, 1873, For. Rel. 1873, I, 654, Moore, Dig., I, 49; Mr. Bavard, Secy. of State, to Mr. Becerra, Colombian Minister, June 1, 1885, For. Rel. 1885, 269, Moore, Dig., VI, 995; Mr. Hay, Secy. of State, to Mr. Merry, Minister to Nicaragua, Oct. 2, 1899, For. Rel. 1900, 810, 811; de Forge Case, French-American Claims Commission, Convention of Jan. 15, 1880, Moore, Arbitrations, 2781, where the payment of duties was not deemed to be an act to aid and comfort the Confederate forces.

3 Mr. Evarts, Secy. of State, to Mr. Foster, Minister to Mexico, No. 615, April 5, 1879, MS. Inst. Mexico, XIX, 556, Moore, Dig., VI, 991; Mr. Bayard, Secy. of State, to Mr. Buck, Minister to Peru, No. 84, Aug. 13, 1886, MS. Inst. Peru, XVII, 228, Moore, Dig., VI, 992; Mr. Hay, Secy. of State, to Mr.

THE PRACTICE OF WITHHOLDING INTERPOSITION [§ 303

concluded with him. It has frequently been declared that unless the conduct of the contracting State was tortious, the citizen should be left to his own devices, save for the possible assistance derived from the good offices of his country lent for the purpose of encouraging the foreign State to give careful attention in a domestic sense to the equities of the case.1 This practice has encouraged belief that the United States has developed a rule of procedure, peculiar to contractual claims and not applied by itself to those of different origin.2 It has been contended also that national reluctance to interpose is based solely upon grounds of expediency. It may be doubted whether either suggestion explains fully what has taken place. If cases in which interposition is commonly withheld possess also an element which, whenever present in claims of different origin, serves also to produce a like result, the treatment accorded the former would merely emphasize the existence of a principle of general applicability. Moreover, habitual unwillingness on the part of a State under well-defined circumstances to lend its aid to its own nationals burdened with contractual issues with foreign governments, might encourage the inference that a sense of justice rather than one of expediency impels restraint.

It has been seen that the propriety of interposition depends priDudley, Minister to Peru, Nov. 21, 1898, For. Rel. 1901, 430; Moore, Dig., VI, 993.

See, also, Dix Case, American-Venezuelan Commission, 1903, Ralston's Report, 7, 8; Heny Case, before same Commission, id., 14, 22.

In the Bolívar Railway Company Case, British-Venezuelan Commission, 1903, Ralston's Report, 388, 394, it was said by Mr. Plumley, Umpire: "The nation is responsible for the obligations of a successful revolution from its beginning, because, in theory, it represented ab initio a changing national will, crystallizing in the finally successful result. Success demonstrates that

from the beginning it was registering the national will.”

1 Mr. Madison, Secy. of State, to Mr. Livingston, Minister to France, Oct. 27, 1803, MS. Inst. U. S. Ministers, VI, 155, Moore, Dig., VI, 707; Collection of documents cited, id., VI, 705-707; Mr. J. Q. Adams, Secy. of State, to Mr. Salmon, April 29, 1823, Am. State Pap., For. Rel., V, 403, Moore, Dig., VI, 708; Mr. Buchanan, Secy. of State, to Mr. Ten Eyck, Commissioner to Hawaii, Aug. 28, 1848, MS. Inst. Hawaii, II, 1, Moore, Dig., VI, 708; Mr. Marcy, Secy. of State, to Mr. Clay, Minister to Peru, May 24, 1855, MS. Inst. Peru, XV, 159, Moore, Dig., VI, 709; Mr. Fish, Secy. of State, to Mr. Miller, May 16, 1871, 89 Dom. Let. 348, Moore, Dig., VI, 710; Mr. Bayard, Secy. of State, to Mr. Bispham, June 24, 1885, 156 MS. Dom. Let. 88, Moore, Dig. VI, 716.

2 E. M. Borchard, 'International Contractual Claims and their Settlement", Society for Judicial Settlement of International Disputes, No. 13, Baltimore, 1913, 4-6, 7-9, 10-11; same author, Diplomatic Protection, § 112; Memorandum of Law Officer of Department of State, Dec. 8, 1906, concerning wrongs done to American citizens by the Government of Venezuela, Senate Doc. No. 413, 60 Cong., 1 Sess., 109; R. Floyd Clarke, Proceedings, Am. Soc. of Int. Law, IV, 149.

3 Clement L. Bouvé, Proceedings, Am. Soc. Int. Law, IV, 174, 181.

marily upon a denial of justice by the foreign territorial sovereign, and secondarily, upon its failure to offer a means of redress for its own delinquency. Whenever States make adequate provision for the adjudication of contractual claims against them before domestic tribunals, as they frequently do,' the latter requirement is wanting, and, howsoever the breach of contract is regarded, the situation merely affords an illustration of the general principle respecting the duty of a claimant to exhaust his local remedies.3

It may be doubted, however, whether the mere breach of a promise by a contracting State with respect to an alien is generally looked upon as amounting to internationally illegal conduct. Nor does the motive which impels such action appear to suffice

"Local Remedies are provided generally in foreign countries for the settlement of contract claims founded upon contracts with the Government or its agencies." Department of State, Claims Circular of 1919, Section 8.

2§ 145 of the Judicial Code, 36 Stat. 1136, U. S. Comp. Stat. 1918, § 1136, conferred upon the Court of Claims a limited jurisdiction over contractual claims against the United States. That jurisdiction appears to have been somewhat restricted also by the Act of March 4, 1915, § 5, 38 Stat. 996, U. S. Comp. Stat. 1918, § 1136a.

According to § 153 of the Judicial Code, 36 Stat. 1138, U. S. Comp. Stat. 1918, § 1144, the jurisdiction of the Court of Claims is not permitted to extend to any claim against the Government, growing out of or dependent upon any treaty stipulation "entered into with foreign nations or with the Indian tribes."

According to § 155 of the Judicial Code, 36 Stat. 1139, U. S. Comp. Stat. 1918, § 1146: "Aliens who are citizens or subjects of any government which accords to citizens of the United States the right to prosecute claims against such government in its courts, shall have the privilege of prosecuting claims against the United States in the Court of Claims, whereof such court, by reason of their subject matter and character, might take jurisdiction."

See, also, par. 20, § 24, of the Judicial Code, 36 Stat. 1093, U. S. Comp. Stat. 1918, § 991 (20), giving concurrent jurisdiction, in certain classes of cases, to the United States District Courts.

In the case of Eastern Extension Telegraph Co. v. United States, 231 U. S. 326, it was held that while the Act of March 3, 1887 (the Tucker Act), broadened the then existing jurisdiction of the Court of Claims, the Act was not necessarily repugnant to or inconsistent with the statutory limitations excluding from the jurisdiction of the Court claims arising from treaty. See, also, Eastern Extension Telegraph Co. v. United States, 251 U. S. 355, 357, 362.

Concerning the right of a British subject to sue in the Court of Claims by reason of the reciprocal treatment accorded American citizens in Great Britain, by a petition of right, see United States v. O'Keefe, 11 Wall. 178. See, also, documents cited in Moore, Dig., VI, 676–677, relative to the rights of Turkish and Russian subjects to sue in the Court of Claims; E. M. Borchard, Diplomatic Protection, § 70.

3

Declared Mr. Bayard, Secy. of State, to Mr. Bispham, June 24, 1885: 'When the alleged debtor sovereign declares that his courts are open to the pursuit of the claim, this by itself is a ground for a refusal to interpose. Since the establishment of the Court of Claims, for instance, the Government of the United States remands all claims held abroad, as well as at home, to the action of that Court, and declines to accept for its executive department cognizance of matters which by its own system it assigns to the judiciary.' 156 MS. Dom. Let. 88. Moore, Dig., VI, 715. Obviously, the duty to withhold interposition until local remedies have been exhausted is always based on the assumption that the courts of the territorial sovereign have done nothing to forfeit the confidence of the outside world in their integrity or ability.

INSTANCES OF INTERPOSITION

[§ 304 to attach to it a lawless character which it would otherwise not possess.1 In the estimation of statesmen and jurists, international law is probably not regarded as denouncing the failure of a State to keep such a promise, until at least there has been a refusal either to adjudicate locally the claim arising from the breach, or, following an adjudication, to heed the adverse decision of a domestic court. Upon the happening of either of these events the denial of justice is regarded as first apparent. There is then seen a failure to respect a duty of jurisdiction which is distinct from the breach of the contract and subsequent to it in point of time.

(2)

$304. Instances of Interposition.

Instances are numerous where the foreign State commits an act which not only violates its agreement, but also presents a tortious. aspect, in evincing, for example, a wanton disregard of the duty to protect the person or property of the claimant. In such a situation, if justice is not obtainable through domestic channels, interposition finds justification because the conduct of the contracting State partakes of a character which is generally denounced as illegal, irrespective of the fact that it is also inconsistent with the contractual duty towards the claimant.2 This is seen when the contracting State, contrary to the terms of its agreement, forfeits a concession without judicial procedure,3 or when it ar

1 The presence or absence of bad faith on the part of a State in disregarding the terms of a contract with an alien is unimportant except as a circumstance to be considered in determining whether the conduct of the State with respect to the alien constitutes, irrespective of the breach of contract, a denial of justice.

2 See, for example, Mr. Bayard, Secy. of State, to Mr. Scott, Minister to Venezuela, No. 118, June 23, 1887, MS. Inst. Venezuela, III, 574, Moore, Dig., VI, 724-725; Mr. Root, Secy. of State, to Mr. Russell, American Minister, Feb. 28, 1907, relative to the claim of the New York & Bermudez Co. against Venezuela, For. Rel. 1908, 774, 793.

3 See, for example, Mr. Cass, Secy. of State, to Mr. Lamar, Minister to Central America, No 9, July 25, 1858, Moore, Dig., VI, 723; Mr. Bayard, Secy. of State, to Mr. Scott, Minister to Venezuela, No. 118, June 23, 1887, MS. Inst. Venezuela, III, 574, Moore, Dig., VI, 724; Same to Same, No. 122, Aug. 12, 1887, MS. Inst. Venezuela, III, 578, Moore, Dig., VI, 725; Ozama Bridge Claim (Henry W. Thurston) against the Dominican Government, For. Rel. 1898, 274-291, Moore, Dig., VI, 729; Memorandum of W. L. Penfield, Solicitor to the Dept. of State, concerning claims of Salvador Commercial Company against Salvador, For. Rel. 1902, 839, 843; opinion of a majority of the arbitrators in the same case under agreement with Salvador of Dec. 19, 1901, id., 862, 871; Mr. Blaine, Secy. of State, to Mr. Loring, American Minister, Oct. 12, 1889, concerning the Delagoa Bay Railway Concession, For. Rel. 1902, 849, Moore, Dig., VI, 727–728; Mr. Olney, Secy. of State, to Mr. Gana, Chilean Minister, June 28, 1895, For. Rel. 1895, I, 83, Moore, Dig., VI, 728; Mr. Hay, Secy. of State, to Mr. Hunter, Nov. 4, 1898, concerning

bitrarily, and without regard for the decisions of its own courts grants away to others rights lawfully vested by contract in the concessionaire, thereby impairing or destroying the value of the concession. Again, if the territorial sovereign does not hold itself amenable to suit in its own courts,2 or unreasonably discriminates against the alien claimant in seeking access thereto,3 or perverts its judicial system for purposes of oppression or for the purpose of obtaining a decision in its favor, the gross failure to perform an obvious duty of jurisdiction explains the action of the State of the claimant. No principle peculiar to contractual claims is involved.

If redress is demanded on account of a denial of justice apart from the breach of contract, the damages attributable to the foreign territorial sovereign ought logically to be measured by a delictual rather than by a contractual standard, that is, by the extent of the harm suffered by the claimant through the commission of internationally illegal conduct, rather than by the prospective benefits lost through the breach of the agreement. It is to be observed, however, that when the United

Claim of R. H. May v. Guatemala, For. Rel. 1900, 648, Moore, Dig., VI, 730, also award of the arbitrators in this case, under protocol with Guatemala, of Feb. 23, 1900, For. Rel. 1900, 659. See, also, telegram of Mr. Root, Secy. of State, to Mr. Fox, American Minister to Ecuador, June 15, 1907, concerning the difficulty between the Ecuadorean Government and the Guayaquil and Quito Ry. Company, an American Corporation, For. Rel. 1907, I, 385.

1 Mr. Root, Secy. of State, to Mr. Russell, American Minister, Feb. 28, 1907, concerning the claim of the Orinoco Corporation against Venezuela, For, Rel. 1907, 774, 780. Although the Government of Venezuela agreed, Feb. 13, 1909, to adjust this claim by arbitration unless an amicable settlement were made with the company with the consent of the United States, an agreement for settlement was finally reached by diplomacy whereby the Venezuelan Government undertook to pay the sum of $385,000, one eighth in cash, and the balance in seven equal installments. Am. J., III, 985, 987; id., Supp., III, 224.

See, also, the so-called Critchfield Claim (United States & Venezuela Co.) against Venezuela, arising from the destruction by increased taxation of the vested rights of the claimant contrary to the terms of its concession. For. Rel. 1908, 793-796. Respecting the agreement of Feb. 13, 1909, to adjust this claim by arbitration, and its ultimate settlement by diplomacy, see Am. J., III, Supp., 224; Am. J., III, 985–987.

2 Mr. Evarts, Secy. of State, to Mr. Gibbs, Minister to Peru, Oct. 31, 1877, For. Rel. 1895, II, 1036, Moore, Dig., VI, 720.

3 Mr. Evarts, Secy. of State, to Mr. Langston, Minister to Haiti, Dec. 13, 1877, MS. Inst. Haiti, II, 121, Moore, Dig., VI, 724. See, also, Mr. Bayard, Secy. of State, to Mr. Hall, Minister to Central America, Sept. 11, 1888, For. Rel. 1888, I, 165, Moore, Dig., VI, 727.

Mr. Root, Secv. of State, to Mr. Russell, American Minister, Feb. 28, 1907, concerning claim of New York & Bermudez Co. against Venezuela, For. Rel. 1908, 774, 793; Same to Same, June 21, 1907, id., 800, 803.

5 "A purely delictual action is based upon detriment suffered by the plaintiff, and that detriment is the measure of damages. A purely contractual action, on the other hand, is based on breach of promise, whether accompanied by