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Panama Canal Tolls


LITTLEFIELD, of the New York Bar.

The recommendation of President Wilson, March 5, 1914, that the exemption from the payment of tolls at the Panama Canal

"upon vessels engaged in the coastwise trade of the United States”

with the assertion that the exemption was “in plain contravention of the Treaty” raised at once the question of the correct legal construction of the Treaty. While the discussion engendered has taken a very much wider range, this paper will be. confined to that issue. Inasmuch as this is to be a legal discussion upon legal principles, it will be convenient to state at the outset the salient, well-known legal rules of construction applicable, although the major part of the discussion has proceeded with an utter disregard of all rules.

While a treaty is an international contract, it is also a law. The Constitution so declares

"and all Treaties made . . . . . shall be the supreme law of the land.” (Con. Art. VI.)

The court treats it as a law:

“Neither can this court supply a casus omissus in a treaty any more than in a law.” (U. S. v. Choctaw Nation, 179, U. S. 533; 45 L. ed. 306).

The rules, then, that apply to the construction of laws apply to the construction of a treaty, as it is a part of the "supreme law." Great industry has been exercised in resurrecting long forgotten documents and historical conditions, having no connection with or relation to the Treaty in question, for the purpose of impressing upon its terms a desired meaning, which otherwise it does not seem to be possible to find therein. The famous speech of Senator Root (1913) is practically wholly devoted to these extraneous, aliunde considerations, and is an extremely able, exhaustive and astute effort to establish from the outside, what in his judgment should be found on the inside, of the HayPauncefote Treaty, quite irrespective of whether the language used by the contracting parties establishes his pro-British contention. In common with Sir Edward Grey, he treats a reference in the preamble of the Hay-Pauncefote Treaty to section 8 of the Clayton-Bulwer Treaty as equivalent to an incorporation of that section into the Hay-Pauncefote Treaty. As to this the rule of construction is well settled :

“Grotious has assigned three common places from whence we may trace out the design where the words are obscure or ambiguous, viz.: the subject, 'the effects and the circumstances.” (Puffendorf Book V, Chap. XII (1749).

Attention should be paid to the reason of the Treaty

“whenever it is required to explain an obscure, equivocal and undetermined point, either of a law or of a treaty, or to make an application of them to a particular case.” (Vattel Book 2, Ch. 17, Sect. 287, Ed. 1796).

“If there be ambiguity in the contract resort may be had to the situation of the parties, and the circumstances under which it was entered into for the purpose not of changing the writing, but of furnishing light by which to ascertain its actual significance." (Walker v. Brown, 165 U. S. 654-668; 41 L. ed. 872).

“The spirit of the act must be extracted from the words of the act and not from conjectures aliunde." (Gardiner v. Collins, 2 Pet. 58, 93; 7 L. ed. 347, 359).

As applicable to a treaty, the court said:

"If the words be clear and explicit, leaving no room to doubt what the parties intended, they must be interpreted according to their natural and ordinary significance." U. S. v.. Choctaw Nation, supra.)

As to the significance of the preamble,

".. ... the preamble is no part of the act, and cannot enlarge or confer powers nor control the words of the act unless they are doubtful or ambiguous.(Yazoo & Mississippi R. R. v. Thomas, 132 U. S. 174; 33 L. ed. 302).

“..... the preamble may be referred to in order to assist in ascertaining the intent and meaning of a statute fairly susceptible of different construction.” (Price v. Forrest, 173 U. S. 410, 427; 43 L. ed. 749, 755).

(Italics in these quotations are mine).

It seems clear that unless there is ambiguity, doubt or uncertainty, the treaty must speak for itself. The presumption is that the contracting parties knew what they wanted, and had intelligence enough to use language that would clearly express their intentions. That is international law, common .law, and common sense.

Senator Root deliberately reversed this well-settled rule of construction in both of his speeches and insists that the treaty must be construed in accordance with a theory that he has evolved from a heterogenous collection of declarations, none of which contemplated the conditions involved in the Hay-Pauncefote Treaty, and says (1914):

“You cannot give that construction to those words if there is any construction that can be given to them consistent with the declarations that I have been recounting here.'

This abstract generalizing, projecting into the treaty from the outside, a meaning not otherwise to be found in it, suited his purpose at that stage of his argument. Later, for another phase of his contention, the language of the treaty being more useful, he blandly insists

"I do not know that any of us should assume to know better than the treaty makers or assume to know better than the treaty itself.”

If he had consulted himself, and acquired this essential information earlier, before he began his discussions, he would have saved himself a deal of unnecessary labor, eliminated confusion, and facilitated a rightful and intelligent result.

If a tithe of the effort that has been expended to sustain the British contention in unearthing ancient and modern "instances" had been devoted to a reasonably careful examination of the treaties involved, it would have easily eliminated all supposed ambiguity and uncertainty. The effort has apparently been to create uncertainty by the introduction of matters aliunde, rather than to ascertain by ordinary analysis what the parties clearly meant by the language actually used. In passing for the moment this phase of the question, it is in point to remark that it is unfortunate that Senator Root and Earl Grey, while searching for “instances,” did not prosecute their inquiries far enough to learn of the treaty between Great Britain and the United States of 1815, as the construction placed upon that treaty by Great Britain, as will appear later, distinctly and clearly negatives their whole contention. Not all of the pro-British advocates have ignored the contents of the treaty. A shining and conspicuous example is Professor Wambaugh, of the Harvard Law School. He has made a microscopic examination, and has subjected it to the acid test of an arithmetical or mathematical analysis. He finds that by actual computation, frills and all,

"it contains fewer than nine hundred words, and that only

"almost exactly six hundred words can be considered as indicating the rights and duties which it creates or recognizes.”

There are other treaties and acts which use more words. “Six hundred words,” he says, are not enough, and for that reason,

“however carefully framed, cannot cover the whole ground.”

In the absence of knowing just how many "words” ought to be used in order to adequately cover any one of the many subjects involved in his postulate, a fact which the erudite professor has hitherto successfully concealed about his person, it would be an act of unwarranted temerity to criticize this mathematical demonstration. Its novelty is conceded, and the professor is entitled to the full credit of its discovery, but I venture in the absence of the necessary knowledge to question its utility.

In 1850 the foreign commerce of the United States aggregated in value $330,037,038, and we then carried of this amount $239,272,084, or 72.5 per cent.

The age-long dream of an Inter-oceanic Canal was apparently about to be realized by its construction at Nicaragua by private enterprise and capital. Great Britain, in the teeth of the Monroe Doctrine, claimed to have established a foothold at the Atlantic terminus of the proposed canal. Uninvited, under these circumstances, the United States and Great Britain entered into a contract known as the Clayton-Bulwer Treaty, by virtue of which they proposed to take virtual charge of a great enterprise, in the construction and maintenance of which neither of them intended to spend a dollar. They agreed that neither of them should acquire exclusive control over the canal, that they should not fortify it, and should not use their positions to procure any advantages that were not offered on the same terms to the other. In order to have an opportunity to use it themselves under all circumstances, it was necessary for them to protect it, and to guarantee its neutrality as against all other nations, and this protection and neutrality was therefore agreed to. The fact that it was thus protected and neutralized as to all other nations added nothing to their burdens, as such protection and neutrality was necessarily involved in their own protection. If the regulations and tolls imposed by the owner were not satisfactory or were discriminatory, on six months' notice the pro

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