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and I called the attention of the gentleman from Maine [Mr. HALE] to this point—precisely the same letter of instructions to the counsel of the United States, Messrs. Cushing, Evarts, and Waite, enjoining them that in any argument they should make they should be careful not to commit the Government to any private claim whatever. The following is the letter of instructions to these gentlemen, identical in language to the clause I have quoted above:

DEPARTMENT OF STATE.
WASHINGTON, December 8, 1871.

GENTLEMEN: In the discussion of this question and in the treatment of the entire case you will be careful not to commit the Government as to the disposition of what may be awarded or what may be recovered in the event of the appointment of the board of assessors mentioned in the tenth article of the treaty. It is possible that there may be duplicate claims for some of the property alleged to have been captured and destroyed, as in the case of insurers and insured. The Government wishes to hold itself free to decide as to the rights and claims of insurers upon the termination of the case. If the value of the property captured tor destroyed be recovered in the name of the Government, the distribution of the amount recovered will be made by this Government without committal as to the mode of distribution. It is expected that all such committal be avoided in the argument of counsel.

I have the honor to be, gentlemen, your obedient servant. HAMILTON FISH.

Hon. CALEB CUSHING, WILLIAM M. EVARTS. and M. R. WAITE.

Thus it will be seen that the Government refused utterly to undertake to bind themselves or to be bound in any way to any distribution of this award. They determined to hold what might be awarded as compensation for the wrongs of the United States, so that there should be no right on the part of any individual to say "My money is there; I must have it." The award was to be and was in full settlement of all claims, as well those of the Government as of its claims, as well those of the Government as of its citizens; for under the well-known principle of international law, no citizen of one Power can have an individual claim upon a hostile Power for belligerent acts; and although Great Britain was in form a neutral Power during the war when the acts complained of were done, yet we were dealing with her (if I may use the word by way of illustration) as accessory to a hostile belligerent Power and standing in its place. Therefore we put all claims against her on the same ground that we should have done if the acts for which indemnity was sought had been acts of a belligerent Power. Thus in advance the United States refused and directed their agents to refuse to take this money otherwise than as its own, to be dealt with at its own will. The Government instructed its agents and counsel not only not to bind it to become a trustee for this money for any claimant, but to so conduct the cause that no argument should be made that should raise the implication of such trust in the hands of any arbitrator. Words cannot make the position of the Government stronger on this point.

I think this fact, rightly considered, disposes of a great number of claims which have been presented here on the ground that the United States holds this money in trust to be distributed under some special rule of municipal law. The United States cannot be made a trustee against its will, and it expressly declared that in reference to this money it would not be made trustee for anybody. No class claimants have come here to set up the existence of such a trust except the insurance companies, the underwriters, who demand that their claims shall be first considered and first paid.

And being a body of great wealth and power, they have brought before your committee two very able, learned, and eloquent counsel, who have made arguments before us and submitted briefs which are on your tables, claiming the sum secured by the United States as received upon a trust in favor of the insurance companies. They submitted the same argument to the Senate of the United States—and I suppose I may refer to the past action of the Senate as shown in the Globe—and that claim was met simply by a vote of two thirds of the Senate against that assumption; and for these among other reasons, that the insurance companies entered into the business of insuring as a matter of profit. They took no risk but what they believed on the theory of insurance, and as a rule in theory of fact, the premium was equal to the risk. They took equivalent pay for everything they did; and they have received in war premiums much more in the aggregate than all they have paid out. The whole amount they claim to have paid out is a little more than $5,000,000. When we come to take out the amount of reinsurance, the amount of war premiums which are now on file claimed to have been paid amount to over $6,000,000, and probably not more than two thirds have been filed. So the insurance companies as a body have made a clear profit of $2,000,000 out of the war risks arising out of the depredations of the rebel cruisers.

Therefore, Mr. Speaker, it has not seemed to your committee just or equitable that a second payment in addition to that already made to the insurers by premiums they have received from the merchants of the country should be made out of this indemnity fund received by the United States, if for the benefit of any individual, only for those who had suffered loss. The underwriters were only men who went into the war as a business speculation; and they are no more entitled to be indemnified for losses in any other business.

A MEMBER. Still the award gives it to them.


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Mr. BUTLER, of Massachusetts. I will come to that before I have finished all I have to say about the insurance companies.

Therefore, Mr. Speaker, it seemed to us that to give them money they had already received would be clearly to pay them twice; but besides, as they have claimed to be repaid their reinsurance in such cases if we allowed these claims, the same loss would be paid three times.

But it did seem equitable to your committee, and our bill provides, where an insurance company made a loss on the whole, taking an account of profit and loss, because of war insurance, if it turns out the underwriters made an actual loss on the whole, that he shall be paid for such actual loss, but subordinating that payment in our judgment to the more meritorious classes of claimants. So if there are any unfortunate insurance companies which have suffered by these depredations, those unfortunate insurance companies have a right under this bill to share in the award.

Now, then, the insurance companies claim they were subrogated to the rights of the assured. That is true as a principle of mercantile law well understood and in all courts of justice to be fully administered. But what is the principle of subrogation? It is, where the underwriter pays a total loss in full, if anything be saved out of the wreck he shall have the right to that fragment; in other words, he shall have all the rights the assured had when he abandoned the property and claimed his loss on his policy. That is the law and has been frequently adjudicated. But the difficulty in its application to the matter in hand is, that here is nothing to which the assured have any legal right. I have already enunciated (which no man will be rash enough to dispute as a principle of international or public law) that no citizen has any claim against a foreign Government for any act done in carrying on hostilities in war. Therefore the assured have no rights to which the insurance companies can be subrogated. If any one of these ships where the insurance companies paid the loss, yea, if any splinter; but the unfortunate fact existing in bar of this claim is, every splinter has gone to the bottom, and is the only thing above the ocean is the right of the United States as a nation to claim that Great Britain make good her neutral obligations by the payment of money for the wrong done the Government or answer the consequences. In neither the money to be paid nor the consequences to be suffered by Great Britain has the assured any legal property which can pass to the underwriter.

Suppose we had gone to war with Great Britain to avenge our wrongs instead of taking money by arbitration in payment for them, how many insurance companies would come forward and claim they were subrogated to the duty of the assured to pay the expenses of that war because they were assignees of the rights of the assured to receive what might be gained by the war? They would have paid no able counsel to come here and advocate the performance of that which would be correlative duty if they had any peculiar right to results of the war.

Suppose further, that in that war to vindicate the rights of the assured and their subrogated underwriters, the United States had been beaten and compelled to pay the costs of the war by the provisions of the treaty of peace, as France lately was by Germany to many millions, should we find the insurance companies here anxious and lobbying to be subrogated to the rights of the assured in such results of our negotiations with Great Britain?

Or if the other clause of the treaty of Washington, which provides for a commission which shall give remedy to the citizens of Great Britain against the United States, results so disastrously to us that we are compelled to pay much more than the Geneva award for the losses of British subjects by the war, will the underwriters come forward and beg to be subrogated as representing the assured to any share of that loss by the Government?

In that case they would be in the condition of the good citizen in Ireland who made himself an informer and found that the penalty was fifty lashes, half of which were to go to the informer. And to get that share we should not have had able counsel here to subrogate them to the rights of the assured.

Sir, I will no further discuss this question. It is fully presented in the report of your committee, and I wait to hear the answer. But let me say that I am quite familiar with the cases cited by the learned counsel for the insurance companies of Comegys vs. Vasse (1 Pet. R., 193) and the case of Rogers vs. Hosacks, executors, (18 Wendell, R., 319,) and the cases therein commented upon. I desire the House to understand that in those two cases the courts were dealing with an entirely different subject-matter, i. e., the rights of the citizen when their own Government have by treaty given the individual a claim upon itself because of losses suffered by the depredations or wrongs of a neutral Power; or in other words, when by direct words or implication it assumes to pay its citizen has a legal right assignable both at law and in equity. By the treaty of Washington no claim is assumed by the Government in favor of the citizen, and nothing thereby comes into existence which can be assignable.

The case of Comegys vs. Vasse (1 Peters' Report, 193) was where the United States had assumed by treaty with Spain all the losses of its citizens to a certain amount. Vasse was an insurer and he had paid for the total loss