United States v. The Laurada, 85 Fed. Rep., 760.-In this case it was stated by the court that the neutrality laws are not designed to interfere with commerce, even in contraband of war, but merely to prevent distinctly hostile acts, as against a friendly power, which tend to involve this country in war.

Courts in the United States will enforce contracts for the transportation of contraband articles.

Northern Pac. Ry, Co. r. American Trading Co., 195 U. S., 439, 465.

Pearson v. Parson, 108 Fed. Rep., 461.-The complainants. Samuel Pearson and others, alleged that they were owners of property situated in the Southern African Republic and the Orange Free State, and that Great Britain was seeking by means of arms to destroy said property of complainants in a war between England and the Southern African Republic and the Orange Free State, begun in 1899.

The complaint further alleged that Great Britain had been dispatching large quantities of mules and horses, etc., from New Orleans to be used in the war, and was about to load other ships with similar material.

The Bill prayed for an injunction prohibiting the defendants from loading on the ship "Anglo-Australian" and other vessels, mules and horses to be used in the war.

It was conceded on the argument that the court had no jurisdiction of this cause ratione personarum. The complainants sought to maintain the jurisdiction ratione materiae by a claim of right under the treaty of Washington of May 8, 1871, between Great Britain and the United States relative to the "Alabama claims", in which treatyit is declared that:

"A neutral government is bound . . . . not to permit or suffer either belligerent to make use of its ports or waters as the base of naval operations against the other, or for the purpose of the renewal or augmentation of military supplies or arms, or the recruitment of

men.'

Held, that the case was a political one, of which a court of equity could "take no cognizance, and which, in the very nature of governmental things, must belong to the executive branch of the government."

However, the court said that it was almost inconceivable that the "United States intended by the above declaration of the treaty to subvert the well established principle of international law that the private citizens of a neutral nation can lawfully sell supplies to belligerents," and thus have "provided for the most serious and extensive derangement of and injury to the commerce of our citizens whenever two or more foreign nations should go to war; and it would seem that there is nothing in the treaty, especially when its history and purposes are considered, which would warrant the belief that the United States insisted upon inserting therein a new principle of international law, from which the greatest damage might result to the commerce of this country, and which was absolutely different from and antagonistic to the rule and policy which the government of this country had theretofore strenuously and invariably followed. The principle that neutral citizens may lawfully sell to

1

belligerents has long since been settled in this country by the highest judicial authority."

The court further said: " If a belligerent may come to this country and buy munitions of war, it seems clear that he may export them as freight in private merchant vessels of his own or any other nationality, as cargo could be exported by the general public."

LOANS OF MONEY.

June 17, 1823, the British law officers rendered the following opinion:

To the Right Hon. GEORGE CANNING, M. P., &c.

DOCTORS' COMMONS, June 17, 1823.

SIR, We have been honoured with your commands, signified in Mr. Planta's letter of the 12th inst., stating that you were desirous that we should report our opinion on the following questions:—

1. Whether subscriptions for the use of one of two belligerent States by individual subjects of a nation professing and maintaining a strict neutrality between them be contrary to the law of nations. and constitute such an offence as the other belligerent would have a right to consider as an act of hostility on the part of the neutral Government?

2. If such individual voluntary subscriptions in favour of one belligerent would give such just cause of offence to the other, whether loans for the same purpose would give the like cause of offence?

3. And, if not, where is the line to be drawn between a loan at an easy or mere nominal rate of interest, or a loan with a previous understanding that interest would never be exacted, and a gratuitous voluntary subscription?

In obedience to your commands, we beg leave to report that we have taken the same into our consideration, and we are of opinion that subscriptions of the nature above alluded to, for the use and avowedly for the support of one of two belligerent States against the other, entered into by individual subjects of a Government professing and maintaining neutrality, are inconsistent with that neutrality. and contrary to the law of nations; but we conceive that the other belligerent would not have a right to consider such subscriptions as constituting an act of hostility on the part of the Government. although they might afford just ground of complaint, if carried to any considerable extent. With respect to loans, if entered into merely with commercial views, we think, according to the opinions of writers on the law of nations, and the practice which has prevailed, that they would not be an infringement of neutrality; but if, under colour of a loan, a gratuitous contribution was afforded without interest, or with mere nominal interest, we think such a transac tion would fall within the opinion given in answer to the first question.

We have the honour to be, &c..

CHRISTOPHER ROBINSON (King's Advocate),
R. GIFFORD (Attorney-General),,

J. S. COPLEY (Solicitor-General).

Halleck, (4th ed. by Baker) vol 2, pp. 186, 187.

Since money is truly described as the sinews of war, and it is no part of the business of a state to deal in money, its loan by a neutral state to a belligerent would necessarily have a special character, not only as aiding the latter in fact but also as disclosing an intent to aid him in his war. It would therefore be an unneutral act. If by the Law of the neutral state the consent of the executive is required to loans by individuals to foreign powers, or if the executive is in the habit of practically controlling such operations by the exercise of its influence, a loan by individuals to a belligerent which is allowed to slip through the meshes will have an international character not distinguishable from a loan by the state. But in countries where, as in England, the loan market is free in time of peace, the question arises whether the state is bound to interfere with it in time of war by a prohibition to lend to belligerents. In such a country loans to foreign states are not political but commercial acts, falling within the daily habits of persons engaged in business, not implying any intent by those persons as to the use to be made of the money by the governments assisted, and such that to prevent them just when the greatest profit is likely to be obtained from them would be felt to be an onerous interposition. They do not constitute a participation in any specific operation of war, nor is the branch of business to which they belong reserved for public action by the general understanding of the civilised world. Tried therefore by the tests which have been suggested as imposed by the theory of neutrality, loans by neutral individuals to belligerent states must be pronounced legitimate, and such they are in fact held to be.

Westlake, vol. 2, pp. 251, 252.

In the war between Great Britain and the South African Republics loans were openly negotiated for the British Government in the United States and elsewhere, and the same thing has taken place in the war between Russia and Japan.

Moore's Digest, vol. vii, p. 978.

In April, 1904. the commandant of the Mare Island Navy-Yard transmitted to the Secretary of the Navy copies of circulars received in an envelope from the consulate-general of Japan at New York City, addressed To the Japanese Serving in the United States Navy," soliciting subscriptions to Japanese bonds and contributions to the relief fund for Japanese soldiers and sailors and to the Red Cross Society of Japan. In view of the President's proclamation of neutrality, the Secretary of the Navy asked whether the circulars should be forwarded. It was held by the Department of State that, while Japanese in the United States doubtless had a right to make such subscriptions and contributions as were referred to, it was undesirable that they should be solicited through American official channels, and the commandant of the Mare Island Navy-Yard was instructed not to forward any of the circulars to Japanese in the United States. The legation of Japan was so notified.

Moore's Digest, vol. vii, p. 869; For. Rel. 1904, p. 427.

The most indispensable means for the conduct of a War is money. For this very reason it is difficult to prevent altogether the support

of one or other party by citizens of neutral States, since there will always be Bankers who, in the interest of the State in whose success they put confidence, and whose solvency in the case of a defeat they do not doubt, will promote a loan. Against this nothing can be said from the point of view of the law of nations; rather the Government. of a country cannot be made responsible for the actions of individual citizens, it could only accept responsibility if business of this kind was done by Banks immediately under the control of the State or on public Stock Exchanges.

German War Book, p. 191.

In the case of De Wutz v. Hendricks, 9 Moore, 586, Lord Chief Justice Best expressed the opinion that it was contrary to the law of nations, for persons residing in England "to enter into engagements to raise money, by way of loan, for the purpose of supporting subjects of a foreign state in arms against a government in alliance with our own; and that no right of action could arise out of such a transaction."

See also Kennett v. Chambers, 14 Howard, 38.

USE BY BELLIGERENT OF COMMUNICATING APPARATUS BELONGING TO NEUTRAL, OR TO COMPANIES OR INDIVIDUALS-NEUTRAL NOT CALLED UPON TO PROHIBIT.

A neutral Power is not called upon to forbid or restrict the use on behalf of the belligerents of telegraph or telephone cables or of wireless telegraphy apparatus belonging to it or to Companies or private individuals.-Hague Convention V, 1907, Article 8.

Contra.

It is understood that the liberty of the neutral State to transmit dispatches does not imply the right to make use or permit use thereof manifestly for the purpose of lending assistance to one of the belligerents.

In applying the preceding rules, no difference is to be made between State cables and cables owned by individuals, nor between cables which are enemy property and those which are neutral prop

erty.

Institute, 1902, p. 162.

Contra.

There is no doubt that a state is bound in principle not knowingly to allow the use of its services for the reception and transmission of letters or telegrams, the latter whether wireless or not, in furtherance of belligerent interests; and where any such service is not a state monopoly, its exercise in the territory by a private undertaking ought to be subject to a similar restraint. Such use of the service would be a direct aid to the belligerent, an implication in the operations which were combined by means of it, and would make the territory a base of operations to that extent. There is however great difficulty in making any practical application of the principle. The contents of letters cannot be known without an intolerable violation of the secrecy of the post office, and the true meaning of telegrams may be concealed by cipher, or by the employment of common words and names arranged to convey to the recipient a sense which others cannot penetrate. It does not seem possible for a neutral state to do more than to refuse for itself, and prohibit for the private undertakings in its territory, the reception and transmission of messages in cipher, or in common language which from its want of apparent sense may be inferred to be the equivalent of cipher, when those messages appear from their address to be intended for the benefit of a belligerent operation. In the instructions issued in 1898 by Brazil, Art. 5 ran that "it is prohibited to citizens, or aliens residing in Brazil, to announce by telegraph the departure or near arrival of any ship, merchant or war, of the belligerents, or to give them any orders,