seamen on American vessels enjoy a peculiar position. By section 2174 of the Revised Statutes, since repealed though in part revived in the Act of May 9, 1918 (40 Stat. 542), an alien seaman declarant who has served three years on an American vessel may become naturalized, and "for all purposes of protection as an American citizen, be deemed such, after the filing of his declaration of intention as an American citizen." The Department's circular instruction of 1920 expressly provides for American protection for such alien seamen; and it is a fact that the United States has on many occasions extended protection to them and in one case successfully prosecuted against Chile a diplomatic claim for damages. 13 The Umpire, Judge Parker, differing from the American Commissioner, held that the treaty limited the jurisdiction of the commission to claimants who owed "permanent allegiance to the United States" at the inception of the claim, and inasmuch as the claimant at that time owed "permanent allegiance" not to the United States but to Great Britain, his claim was deemed not within the jurisdiction of the commission.

An interesting Lusitania opinion was rendered by the Umpire on October 30, 1925, Docket No. 3482. The claimants were the successors in interest and children of Mrs. Mary A. Mackenzie, who was lost on the Lusitania. The question was whether the claim was American in origin. Mrs. Mackenzie, at her death, was the widow of Robert A. Mackenzie, who was born in the United States of English parents in 1858. While still a minor, his parents and their children returned to England. He married there in 1879. Soon thereafter, he went to Canada with his family. There was no direct evidence of his election to adopt the British nationality of his parents or to renounce his native American citizenship. In 1894, he removed with his family to Massachusetts, where he lived until his death in 1901. He appears to have always considered and conducted himself as an American citizen. By the operation of British and American law upon him, he appears to have had at birth dual nationality, jure sanguinis and jure soli. The Umpire held that inasmuch as he was American by birth, and had never expatriated himself, he remained an American citizen; that his continued residence in England and Canada after attaining majority did not amount to an election either to retain British nationality or renounce his American citizenship. The inference of the German Agent to this effect was ascribed to the ambiguity of numerous instructions of the Department of State between 1875 and 1888, which confounded the loss of diplomatic protection with the loss of citizenship. It was therefore held that the widow was an American citizen, as were also two of the sons of these American parents who had been born abroad and who, on attaining their own majority, were residing in the United States and continued to reside therein. The survivors

13 Shields' case, May 24, 1897, Malloy's Treaties, I, 190. Shields, a British subject, died during the negotiations, yet the prosecution of the claim was continued on behalf of his heirs. $3500 was paid to the United States. Foreign Relations, 1900, p. 67.

of the deceased were not dependents, hence nothing was allowed them for the death of their mother. The loss of $300 in personal property, however, made it necessary to examine the question of Mrs. Mackenzie's nationality.

In the Lusitania case of Richards, Docket No. 5590, decided November 11, 1925, the claimants were the parents and brothers of a baby of 19 months, lost on the Lusitania. The entire family was apparently on the ship, returning to England, where the father had been born. He had been naturalized in the United States in 1906. Since May, 1915, he and his family had resided in England. The question in the case was whether, under section 2 of the Act of March 2, 1907, the presumption of expatriation had not arisen against him. The question disclosed a novel case. It was held that the two years residence in the native country, which raises the presumption, ran from May, 1915, to April 6, 1917, but, because of the provision that no American citizen can expatriate himself in time of war, the expatriation itself could not take place until July 2, 1921,14 the date when peace was declared. As on that date, he had resided in England more than two years and had done nothing to overcome the presumption, the claimant father and hence the family were deemed not to be American citizens on November 11, 1921, as required by the rules of the commission.

In the claim of Christian Damson, 15 it became necessary to define more fully the excepted class of "naval and military works or materials" and "civilian population." The claimant, an American citizen, was employed in the Army Transport Service and was assigned to duty as the master of the Army Cargo Transport Joseph Cudahy, an oil tanker requisitioned by the Shipping Board and delivered to the War Department. She was engaged in transporting oil supplies for the American military forces in Europe and at the time of her destruction by a submarine she was on her return from France in ballast, intending to take another cargo. Over the dissent of the American Commissioner, she had been held to be within the class of "naval and military... materials," from liability for the destruction of which the Treaty of Versailles exempted Germany. The master, Damson, at the time of the destruction, was forced to take to the small boats, suffered from exposure, and lost personal effects. He claimed that he was a "civilian" and that his personal effects were not "naval . . . materials."

The American Commissioner, by an analysis of American statutes, reached the conclusion that the claimant was a "civilian." The Umpire, however, in his opinion, pointed out that the municipal laws of any one country may not afford the proper criteria to determine the distinction between "civilian population" and military persons, for the former term is incorporated in a treaty subscribed by twenty-six nations and hence requires a certain uniformity of construction. He concluded that the true 14 Department of State Instruction No. 919, November 24, 1923, Circulars Relating to Citizenship, 1925, pp. 118, 120.

15 Opinions, p. 243; this JOURNAL, Vol. 19, p. 815.

criterion for the distinction lies in the activity or occupation of the person in question. "If the activities of such nationals were at the time aimed at the direct furtherance of a military operation against Germany or her allies, then they can not be held to have been 'civilians' or a part of the 'civilian population' of their respective nations within the meaning of the treaty." As master of a "public" vessel used directly in furtherance of military operations, and subject to military orders and discipline, he was held not to have been a "civilian" within the meaning of the treaty. It was also held that his personal property and effects designed for immediate personal use and for use in the navigation of a ship "engaged directly in furtherance of a military operation, were impressed with the military character of the ship and of the claimant," and hence were not the subject of a claim under the treaty. The decision is undoubtedly correct.

16

In the case of Eisenbach Brothers & Co. v. Germany, a shipment of furs belonging to the claimants, American nationals, was lost on an American vessel destroyed by a mine in the North Sea on December 1, 1919, over a year after the armistice. It was unknown who planted the mine. During the period of belligerency, which was deemed to have lasted until July 2, 1921, Germany assumed the liability practically of an insurer for all damages suffered by American nationals "directly in consequence of hostilities or of any operations of war." The German Agent contended that in view of the Armistice Agreement of November 11, 1918, which provided for the "immediate cessation of all hostilities at sea," no act occurring thereafter could be considered an act of hostility or operation of war; and that the immediate and proximate cause of the sinking of the vessel was the failure of the Allies, who alone had the opportunity and responsibility, to sweep the mine fields.

The Umpire held that the planting of the mine during belligerency was an act impressed with a hostile and belligerent character, and that, while remote in time from the destruction wrought, it was nevertheless the natural and proximate cause of that destruction, a causal relation which was not broken or interrupted by any proved act or omission of any Allied Power in failing to sweep the mine field in question.

17

One of the most exhaustive opinions rendered by the commission deals with "Claims for loss of earnings or profits and for loss or damage in respect of intangible property." The test cases included the American charterer of the Norwegian steamer Vinland, which was sunk in 1918 by a German submarine while carrying a cargo of American-owned sugar from Cuba to New York. At the time, the charterer had entered into further contracts for carriage of coal. He claimed for the loss of profits on the sugar cargo and the loss of profit which he was prevented from earning on the prospective coal contracts. Other claims dealt with damages for the loss of fishing ves

16 Opinions, p. 267; this JOURNAL, Vol. 19, p. 821.

17 Opinions, p. 273; reprinted in this JOURNAL, p. 171, infra. It also has an added title, Administrative Decision No. VII.

sels, including the value of the prospective "probable catch" had the vessel not been destroyed, the claims of individual seamen of a destroyed ship for prospective personal earnings lost by them following the sinking, and other claims for loss of tangible property presently to be mentioned.

The American Commissioner believed that all these losses constituted a valid basis of claim, partly on the expressed belief that the Knox-Porter resolution, incorporated in the Treaty of Berlin, went further than the Treaty of Versailles in determining Germany's substantive liability. The German Commissioner denied this, asserting that under the Treaty of Versailles, Part VIII, damages to tangible property only could be recovered, and that loss of profits had been excluded by the Allies in their reparation bill and by the Reparation Commission. The Umpire, Judge Parker, in a carefully reasoned opinion concluded that the German Commissioner's view was substantially correct. He reached this conclusion by showing the essential differences between Parts VIII and X of the Treaty of Versailles. The former, so far as it related to property damage, dealt with damage to property due to military action outside German territory, and embraced "direct physical damage to property of a non-military character" only, under paragraph 9 of the Annex following Article 232. The test cases fell under this article. Part X, on the other hand, dealt with "property, rights and interests," but embraced only "property, rights and interests" in German territory, affected harmfully by "exceptional war measures or measures of transfer." The test cases were not concerned with these provisions, though they did apply to the case of the Seaham Harbour,18 a vessel detained and used in Germany, in which the Anglo-German Mixed Arbitral Tribunal had allowed damages for loss of profits, wages paid to the crew, and other expenses occasioned by the detention of the vessel in Germany. This case evidently was erroneously believed to sustain the American contention that loss of profits were recoverable under Part VIII, though they had been excluded by the Reparation Commission as indirect and consequential damages. The Umpire found, after a detailed chronological and analytical examination, that the Treaty of Berlin did not purport to enlarge Germany's substantive liability over that provided for in the Treaty of Versailles and that the difference lay only in the method of enforcement of the American claims. With respect to the loss of tangible property, the Umpire had already announced the rule (Administrative Decision No. III, December 11, 1923) that the measure of damages was the reasonable market value at the time and place of loss or taking, or if it had no market value, then its "intrinsic" value. While earning capacity was an element in determining market value, the rule was designed to exclude speculative factors, like prospective earnings or profits.

With respect to the interest of charterers, a useful rule was established. It had been contended that the charterer was the temporary "owner," and 18 Anglo-German Mixed Arbitral Tribunal, Recueil des Decisions, I, p. 550; IV, p. 27.

as "property. . . belonging to .. belonging to . . . " the charterer, he was entitled to the amount which he would have earned, had the charter not been terminated by the sinking, less insurance moneys received. The Umpire held that a charterer's claim to damages depended upon his interest in the ship, and this in turn depended upon whether the charter, as a good bargain to the charterer, was an encumbrance or liability to the owner, thus reducing the market value of a “free ship," or whether, as a bad bargain to the charterer, it was an asset to the owner, enhancing the market value. In no event, could more than the market value be recovered by all the parties in interest for the loss of any ship. If the owner's charter involved rates or terms below the market price, he had a good bargain, and his interest in the ship was therefore measured by the difference between the value of a thus encumbered ship and a free unencumbered ship. If he had made a bad bargain, measured by the charter market, he suffered no loss by the termination of the charter. These rules left out of consideration the legality or illegality of the sinking or destruction of the ship, for under the treaty, that was immaterial to Germany's liability. Incidentally, the novel conclusion appears to have been reached that a charterer who has no demise nevertheless had an interest in rem in the vessel. These rules were to be applied to the claims of charterers, but loss of profits as such which might have been earned during the life of the charter had the ship not been destroyed, were excluded. The Umpire also disallowed claims for the value of the "probable catch" of destroyed fishing vessels; the amounts paid by the owner of a destroyed ship as wages to master and crew from the time of destruction to their return to the United States; the amounts the owner would have earned under pending contracts of affreightment and existing charter parties; war risk premiums paid; expenses incurred in establishing his claim; and personal earnings lost by individual members of the crew following the sinking. On the other hand, the Umpire allowed claims for tangible property, including the value of fish, provisions, consumable stores, gear and equipment, etc., lost with the vessel; the value of fuel on board; the reasonable market value, but not exceeding the amount actually paid by the owner to the lessor of wireless apparatus under a contract of indemnity; the amount actually paid to master and crew for loss of personal effects and nautical instruments, not exceeding their reasonable market value; and compensation paid them for personal injuries sustained by them and for hospital and medical expenses incurred, with the very appropriate condition and limitation that master and members of the crew affected shall have been American citizens at the time of loss or injury and at the time of the payments made to them by the owner. Incidentally to the decision of these cases, the Umpire undertook to explain the meaning of that part of section 5 of the Knox-Porter Resolution dealing with the claims of American nationals for "loss, damage or injury to their persons or property, directly or indirectly, whether through the ownership of shares of stock in German, Austro-Hungarian, American or other