New Convention On the 31st of December 1799 Mr. Pickering sent full instructions to Mr. King for the purpose of proposing a new convention in explanation and execution of Article VI.; and, among the principles on which such a convention should be framed, he specified the rule that it must appear that by the operation of lawful impediments the claimant had sustained a loss which he could not "at the time of the exhibition of his claim" recover in the ordinary course of judicial proceedings. He also informed Mr. King that it had been deemed expedient to send Mr. Sitgreaves to London to facilitate the conclusion of the negotiations.1 Early in April 1800 Mr. King presented to Lord Grenville a draft of a convention drawn in conformity with his instructions.2 Protest of Lord Lord Grenville had little hope of the two governments ever agreeing on a construction of the article, and continued to protest against the secession of the American commissioners. Referring to the suspension of the board at Philadelphia, he said it happened that, in choosing a commissioner by lot, the lot under Article VI. fell on a British subject, while that under Article VII. fell on a citizen of the United States. In the course of their proceedings the majorities of both commissions formed their decisions on principles adverse to the opinions of the government against which the claims were preferred. "The awards of the commission under the seventh article have, 1 Am. State Papers, For. Rel. II. 384-485. Mr. Sitgreaves was promised, when he went to London, the continuance of his salary as a commissioner at the rate of £1,000 a year and the expenses of his residence in Europe and his journey to and fro. He returned to the United States on June 10, 1801, and his agent drew for his quarter's salary to June 30. Mr. Madison, who was then Secretary of State, conceiving that, as the commission under Article VI. had been suspended, Mr. Sitgreaves had no claim for salary after his return, declined to allow anything thereafter, but told Mr. Sitgreaves that, if he would state his account, deducting salary from June 10 to June 30, and including his expenses, it should be paid. Mr. Sitgreaves refused to do so, considering that he was entitled to the continuance of his salary under Article VI. till that article was finally superseded by the convention of January 8, 1802. In 1830 Mr. Sitgreaves's heirs, who had put in a claim, were allowed his salary from April 1 to June 10, 1801, and his expenses, Congress appropriating therefor $10,445.56. (House Report 54, 20 Cong. 2 sess.; 6 Stats. at L. 446.) 2 Am. State Papers, For. Rel. II. 394-398. nevertheless," said Lord Grenville, "been faithfully executed by the British Government. The temporary difficulties which arose in the execution of that commission led immediately to amicable explanation between His Majesty's Government and the minister of the United States * ; and considera ble sums have actually been paid to American claimants in cases where the award of the commissioners has rested on doctrines which are decidedly held to be erroneous, and which would not, therefore, have been recognized in any transaction with a foreign state. In America, a contrary course has been pursued. The two commissioners nominated on the part of the United States to the commission under the sixth article have finally claimed the right to invalidate, by their dissent, both the principles and the effect of the decisions of the majority, and have at length, by completely withdrawing from the board, endeavored as far as in them lay, to arrest all its proceedings. It was neither required nor even imagined that the opinions of either commission could be unanimous on points on which the two Governments had found it impossible to agree. In both of them possible differences of opinion were foreseen, and they were provided for in both by the stipulation which gave full force and validity to the acts of the majority." The secession of the American commissioners made it the duty, he said, of the Government of the United States to appoint new ones.1 To the note of Lord Grenville, John MarMarshall's Reply. shall, who had succeeded Mr. Pinkering as Secretary of State, replied that the Government of the United States understood the treaty differently. The provision declaring the decision of the board to be in all cases final and conclusive was not understood to authorize "the arbiters to go out of the special cases described in the instrument creating and limiting their powers. The words 'all cases' only mean those cases which the two nations have submitted to reference. These are described in the preceding part of the article, and this description is relied on, by the United States, as constituting a boundary, within which alone the powers of the commissioners can be exercised. This boundary has, in our judgment, been so totally prostrated, that scarcely a trace of it remains." While admitting that the decision of a majority was binding by the very terms of the treaty, Marshall 1 Lord Grenville to Mr. King, April 19, 1800, Am. State Papers, For. Rel. II. 398. declared that "it was not until a majority of the Board had proceeded to establish a system of rules for the government of their future decisions, which, in the opinion of this Government, clearly comprehended a vast mass of cases never submitted to their consideration, that it was deemed necessary to terminate proceedings believed to be totally unauthorized, and which were conducted in terms and in a spirit only calculated to destroy all harmony between the two nations." He therefore instructed Mr. King, if it should be found impossible to negotiate a reasonable explanatory article, to endeavor to agree on a gross sum to be received as full compensation for all the claims of the creditors.1 Negotiations for Settlement. At one time Lord Grenville thought of sending out "confidential characters" to America for the purpose of facilitating the execution of the treaty, with an eventual appointment as commissioners. He was not inclined either to negotiate a new convention or to discuss the question of a lump sum. He at length decided, however, very wisely, to try the latter alternative. In December 1800 Mr. King presented to him a paper in which it was estimated that the claims against the United States would not properly exceed £400,000. This result was arrived at by assuming that the amount of the debts due at the outbreak of the war was equal to the average amount of British exports to the colonies in one year prior to that event, which was estimated at £2,311,498. From this amount Mr. King deducted one-half on the score of what British creditors lost in consequence of the insolvency of debtors, caused by the war and especially by the operation of paper money, from the beginning to the end of the conflict. This left £1,155,749. As in the majority of States, including the large commercial towns, creditors had experienced no material difficulty in recovering their debts, it was reasonable, said Mr. King, to deduct half of that sum as recovered since the war, leaving £577,874 unrecovered. To this sum, however, he added interest, thus doubling it and restoring the amount due to £1,155,749. Of this he estimated that creditors could, in the existing unobstructed course of justice, recover two-thirds, leaving not more than £400,000 due from the United States. Mr. Marshall to Mr. King, August 23, 1800, Am. State Papers, For. Rel. II. 383, 386, 387. Am. State Papers, For. Rel. II. 390-400. By an analytical statement of the claims submitted to the board in Philadelphia, it appears that their gross amount was £5,638,692 Ss. 1d., which was calculated to be equivalent to $24,809,969.37. It was admitted, however, that, as always happens in such circumstances, the amounts of the several claims were in many instances enormously exaggerated, and the British Government offered to accept between a million and two million pounds. On the 15th of June 1800 Mr. Madison, who had become Secretary of State, instructed Mr. King that not more than £600,000 would be paid,' and, after long and complicated negotiations in which John Anstey assisted on the part of Great Britain,' the British Government consented to accept that sum, if satisfactory terms could be arranged for its payment, and recourse to the courts be secured to creditors for the future. Convention of January 8, 1802. Various projects of a convention on these lines were exchanged, but it was not until January 8, 1802, that one was concluded. On that day Lord Hawkesbury and Mr. King signed a convention by which Article VI. of the treaty of 1794 was annulled, and the sum of £600,000, payable at Washington in three equal annual installments, and in money of the United States reckoned at $4.44 to the pound sterling, was accepted in satisfaction of what the United States might have been liable to pay under that article. This sum, amounting to $2,664,000 was duly appropriated and paid. The Secretary of the Treasury was authorized to cause the last installment to be paid in London.5 By Article II. of the convention, Article IV. of the treaty of peace, so far as respected its future operation, was confirmed, so that creditors on either side should in the future "meet with no lawful impediments to the recovery of the full value in sterling money of their bona fide debts."6 1 Am. State Papers, For. Rel. II. 389. 2 Am. State Papers, For. Rel. II. 401-418. 3 Am. State Papers, For. Rel. II. 421-427. 42 Stats. at L. 192; Am. State Papers, For. Rel. II. 62, 67. 5 Act of March 3, 1805, 2 Stats, at L. 336. For appropriations to carry Article VI. of the treaty of 1794 into effect, see the following acts: May 6, 1796, $80,808 (for Articles VI. and VII.), 1 Stats. at L. 460: March 2, 1799, $26,000, Id. 723; May 7, 1800, $52,556, 2 Id. 66; April 18, 1806, $7,750, Id. 389. CHAPTER X. THE RIGHTS AND DUTIES OF NEUTRALS: COMMISSION UNDER ARTICLE VII. OF THE JAY TREATY. Belligerent Pretensions: French Decrees. The first war between Great Britain and France growing out of the French Revolution was characterized, as were other great European struggles of the last and the beginning of the present century, by exorbitant pretensions on the part of the belligerent powers to regulate and control the trade of neutrals. By a decree of the National Convention of May 9, 1793, the commanders of French ships of war and privateers were "authorized to seize and carry into the ports of the republic, merchant vessels which are wholly or in part laden with provisions, being neutral property, bound to an enemy's port, or having on board merchandise belonging to an enemy." Merchandise belonging to the enemy was declared to be "lawful prize, seizable for the profit of the captor." Provisions, if belonging to a neutral, were to be "paid for at the price they would have sold for at the port whither they were bound;" the vessels, if neutral, were to be released as soon as the provisions found on board should have been landed, or the seizure of the merchandise effected; freight was in such case to be settled at the rate paid by the charterer, and proper compensation to be granted by the tribunals for the detention of the vessels. From this decree, however, the National Convention, hopefully looking to the United States as an "ally" in the war, by another decree of the 23d of May declared American vessels to be exempt. In communicating these decrees to the Government of the United States in September 1793 M. Genet, the French minister, declared that the considerations which prompted the second decree were, on the one hand, a disposition on the part of France scrupulously to observe the treaties with the United States, and on the other "the thorough confidence she has that |