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(5) A consideration is essential to give effect to a contract, but it is possible to conceive of a treaty which has no consideration.
Whart. Com. Am. Law, § 157.
As to the position of the United States in reference to the effect of silence in treaties, see 3 Phill. Int. Law (3d ed.), 799.
On the question of repugnancy, the following rules are laid down by President Woolsey (Int. Law, § 109):
"1. That earlier clauses are to be explained by later ones, which were added, it is reasonable to suppose, for the sake of explanation, or which at least express the last mind of the parties. So also later treaties explain or abrogate older ones.
"2. Special clauses have the preference over general, and for the most part prohibitory over permissive.
In treaties made with different parties the inquiry in cases of conflict touches the moral obligation as well as the meaning. Here the earlier treaty must evidently stand against the latter, and if possible, must determine its import where the two seem to conflict.
"In general, conditional clauses are inoperative, as long as the condition is unfulfilled; and are made null when it becomes impossible. Where things promised in a treaty are incompatible, the promises may choose which he will demand the performance of, but here and elsewhere an act of expediency ought to give way to an act of justice.
"A treaty of cession is a deed of the ceded territory by the sovereign grantor, and the deed is to receive an equitable construction. The obligation of the new power to protect the inhabitants in the enjoyment of their property is but the assertion of a principle of natural justice."
See Mr. J. C. B. Davis's Notes, &c., citing Soulard v. U. S., 4 Pet., 511; Delassus v. U. S., 9 Pet., 117; Mitchel v. U. S., ibid., 711; Smith v. U. S., 10 Pet., 326. The effect of coercion in vacating a treaty is discussed in another section, infra, § 130.
V. FAVORED NATION.
"It may fairly be considered as the rational and received interpretation of the diplomatic term gentis amicissima (most favored nation) that it has not in view a nation unknown in many cases (as was the United States at the time when the older treaties containing the phrase were used) at the time of using the term, and so dissimilar in all cases as to furnish no ground of just reclamation to any nation."
Mr. Jefferson, Sec. of State, Report to the President, Mar. 18, 1792. 7 Jeff.
"Though treaties, which merely exchange the rights of the most favored nations, are not without all inconvenience, yet they have their conveniences also. It is an important one that they leave each party free to make what internal regulations they please, and to give what preferences they find expedient, to native merchants, vessels, and productions. And as we already have treaties on this basis with France, Holland, Sweden, and Prusia, the two former of which are perpetual, it will be
but small additional embarrassment to extend it to Spain. On the contrary, we are sensible it is right to place that nation on the most favored footing, whether we have a treaty with them or not, and it can do us no harm to secure by treaty a reciprocation of the right."
Report of Mr. Jefferson, Mar. 18, 1792. 7 Jeff. Works, 587; 1 Am.
Mr. J. Q. Adams, in his note to Mr. Hyde de Neuville of December 23, 1817 (MSS. Notes, France, Cong. Doc. 91, 18th Cong., 2d sess), took the ground that the "favored nation" clause in the treaty of 1803 with France only covered gratuitous favors, and did not touch concessions for equivalents, express or implied, and that any other view would be inconsistent with the provision of the Federal Constitution which prescribes that "all duties, imposts, and excises shall be uniform in the United States, and that no preference shall be given by any regulation of commerce or revenue to the ports of one State over those of another.'
Lawrence's Wheaton, 494. See at large, 2 Lyman's Dip. U. S., chap. vi.
"The mutual stipulation of being treated as the most favored nation is not, in all the treaties between France and the United States, accompanied by the express declaration that the favor granted to a third party shall be extended to France or the United States gratuitously if the grant is gratuitous, and upon granting the same compensation if it be conditional."
Mr. Adams, Sec. of State, to Mr. de Neuville, Mar. 29, 1821. MSS. Notes, For.
Leg. See further, as to meaning of term, same to same, June 15, 1821; ibid. As to effect of term "favored nation" in treaty with France of 1803, see Mr. Gallatin's note to Viscount Chateaubrand, Feb. 27, 1823, quoted infra, § 148; and see also Lawrence's Wheaton, 493, notes.
"The rule of the most favored nation may not be, and scarcely ever is, equal in its operation between two contracting parties. It could only be equal if the measure of voluntary concession by each of them to the most favored third power were precisely the same; but as that rarely happens, by referring the citizens of two contracting powers to such a rule, the fair competition between them, which ought always to be a primary object, is not secured, but, on the contrary, those who belong to the nation which has shown least liberality to other nations are enabled to engross almost the entire commerce and navigation carried on between the two contracting, powers. The rule of the most favored nation is not so simple as the proposed substitute (that of a treaty of reciprocity, which Mr. Poinsett was instructed to negotiate). In order to ascertain the quantum of favor which, being granted to the commerce and navigation of one nation, is claimed by another in virtue of a treaty stipulation embracing that principle, it is necessary that the claimant should be accurately informed of the actual state of the com mercial relations between the nation on which the claim of equal favor is preferred and all the rest of the commercial world. A knowledge of those relations must be sometimes sought after in numerous treaties,
statutes, orders, decrees, and other regulations, and is often of very difficult attainment. When acquired it is not always very easy to distinguish between what was a voluntary grant and that which was a concession by one party for an equivalent yielded by the other. Sometimes the equivalent for the alleged favor proceeding from the one party may be diffused throughout all the stipulations in the treaty by the other, and is to be extracted only after a careful view and comparison of the whole of them. Not unfrequently the equivalent may not even be clearly deducible from the instrument itself conveying the supposed favor. Peculiar considerations may lead to the grant of what, on a first impression, might be conceived to be a voluntary favor, but which has really been founded upon a received equivalent; and these considerations may sometimes apply to the entire commerce and navigation of a country, and at others to particular ports only."
Mr. Clay, Sec. of State, to Mr. Poinsett, Mar. 26, 1825. MSS. Inst., Ministers.
A covenant to give privileges granted to the "most favored nation" only refers to gratuitous privileges, and does not cover privileges granted on the condition of a reciprocal advantage.
Mr. Livingston, Sec. of State, to President Jackson, Jan. 6, 1832. MSS. Report
To same effect, see Mr. Frelinghuysen, Sec. of State, to Mr. Bingham, June 11,
"Your dispatch No. 43, of the Sth ultimo, has been received. You report that Mr. Carter, the special envoy from Hawaii to England and Germany, had succeeded in inducing the German Government to yield the point assumed by those Governments, that the most favored nation clause in their treaties with Hawaii entitled them to equal privileges in regard to imports with those obtained by the United States by the reciprocity treaty with the same country, and that no definite understanding had been reached with England, although it was probable that the proposition made by that Government would be accepted. You also report that there exists among the natives a suspicion that the United States desire to annex the Hawaiian Islands, which is encouraged and made use of by the opposition party.
"In reply I have to state that the note which you addressed to the minister for foreign affairs, claiming that by the 'parity clause of the ordinary form of treaty' other nations were not entitled to the same privileges as were conceded to the United States by the reciprocity treaty with Hawaii, is in accordance with the views of this Department; and that the assurance given by that officer in his reply, that the Government of Hawaii would take care that the integrity of the treaty should not be impaired in any respect, is satisfactory, and it is hoped that this promise may be strictly carried out.
"You will endeavor to disabuse the minds of those who impute to the United States any idea of further projects beyond the present treaty."
Mr. Evarts, Sec. of State, to Mr. Comly, Aug. 6, 1878. MSS. Inst., Hawaii;
The following is the inclosure in dispatch No. 43, above noticed:
"I have the honor to submit to His Majesty's Government, through your excellency, my opinion that the integrity of the treaty of reciprocity between the United States and the Hawaiian Island is threatened.
"Allow me to call your attention to a clause of Article IV of the treaty, as follows:
"It is agreed on the part of His Hawaiian Majesty that so long as this treaty shall remain in force he will not make any treaty by which any other nation shall obtain the same privileges relative to the admission of any articles free of duty hereby secured to the United States.'
"This stipulation is in the nature of a valuable consideration to be paid by one party to the other, as one of the causes which move the contracting parties to enter into an agreement. The failure to pay it would be a breach which would endanger, if not destroy, the whole compact.
"No treaty in existence at the time this compact was entered into secured to any other nation the privileges as to the admission of certain articles free of duty, which have been guaranteed to the United States by this treaty. These privileges were secured, not through any general treaty rights or stipulations, but by giving certain valuable considerations in a special treaty of reciprocal covenants. The concession of these privileges to the United States cannot therefore form any just basis for a claim to like privileges by any other nation, under the parity clause of the ordinary form of treaty. The uttermost that might be conceded under such parity clause would be the claim to purchase the same immunities through special treaty, upon like terms with those agreed upon between the United States and the Hawaiian Islands. But this is in the nature of the case impossible. Those concessions by the United States which are of the greatest value to the islands under this treaty would be of no value whatever from other powers, whose great distance from the best markets for island products would be as effectual a bar to the enjoyment of reciprocity as a prohibitory edict. The effect of such an arrangement would be, if attempted with other powers on the same basis, that the United States would remit some millions of duty on island products during the seven years, in order that other nations might not pay duty to His Hawaiian Majesty on goods brought here to compete with American products.
"This is the precise thing the treaty does not intend. Its intention is to secure exclusive benefits to both contracting parties through special privileges granted by each to the other. To admit the claim of a third party to come in and enjoy all the benefits conceded by both principals, without any payment in equivalent special privileges to either, would be an unprecedented thing.
"It would be strange if the Hawaiian Government and people should fail to take in the advantages secured to them by the treaty, and should suffer its integrity to be impaired. While I cannot believe that there
is real danger of such a result, yet there are circumstances, not necessary to detail particularly, which may excuse this friendly and cautionary mention of some of the rights and privileges of the United States under the treaty."
"While this Government cannot agree with that of Mexico, that under the provisions of the most favored nation clause, another nation becomes entitled to privileges granted by a reciprocity treaty, still as there are various considerations affecting the question as now presented, I content myself with a courteous denial that the most favored nation clause applies to reciprocity treaties, without now entering into any argument on the subject."
Mr. Frelinghuysen, Sec. of State, to Mr. Romero, May 2, 1884. MSS. Notes,
"Mr. Reed's No. 263, of the 10th instant, informs the Department of an interpellation made in the Senate by the Marquis de Muros in regard to the prospect of negotiations between Spain and the United States for a commercial treaty, and the response of the minister of state thereto. It appears that Señor Elduayen deems a specially favoring treaty impracticable at present in view not only of the distressing condition of the Antillean finances, but because he holds that other nations hav ing the most favored [nation] clause in their treaties with Spain would be entitled to all the benefits of any special arrangement with the United States.
"The minister's statements cannot have failed to impress you with some surprise. You are aware that this Government has always assumed that Spain held the same view as ourselves respecting the effect of a reciprocity treaty in connection with the most favored nation clause in other treaties. This country has that clause in many of its compacts with foreign states, but it has never occurred to them or to us to suppose that we were thereby constrained to grant to those treaty powers without equivalent the privileges which we had by special engagements stipulated to concede to countries like Hawaii and Canada, for a valuable consideration."
Mr. Frelinghuysen, Sec. of State, to Mr. Foster, June 28, 1884.
"I had the honor to receive in due season your note of June 19 last, touching the application of the provisions of the fourteenth section of the shipping act, approved June 26, 1884, in respect of the collection of tonnage tax, to vessels of Belgium coming from ports of that country to ports of the United States, under the "most favored nation" clause of the existing treaty of 1875 between the United States and Belgium.
"The importance of the questions involved in the claim of the Belgian Government, and in like claims preferred by other Governments, has led to the submission of the entire subject to the judgment of the AttorneyGeneral.