The Laws Of War, Affecting Commerce And Shipping Part 2

"Where the Government has authorised, under sanction of an Act of Parliament, a _homeward trade_ from the enemy's possessions, but has not specifically protected an _outward_ _trade_ to the same, though intimately connected with that homeward trade, and almost necessary to its existence, the rule has been enforced, where strong claim not merely of convenience, but almost of necessity, excused it on behalf of the individual.

"It has been enforced, where cargoes have been laden before the war, but where the parties have not used all possible diligence to countermand the voyage after the first notice of hostilities.[23]

"In the last war between England and America, a case occurred in which an American citizen had purchased a quant.i.ty of goods within the British territory, a long time previous to the war, and had deposited them upon an island near the frontier; upon the breaking out of hostilities, his agents had hired a vessel to proceed to the spot, to bring away the goods; on her return she was captured, and with the cargo, condemned as prize of war."[24]

So also, where goods were purchased, some time before the war, by the agent of an American citizen in Great Britain, but not shipped until nearly a year after the declaration of hostilities, they were p.r.o.nounced liable to confiscation.[25]

Where property is to be withdrawn from the country of the enemy, it is the more satisfactory and guarded proceeding on the part of the _British_ merchant to apply to his own Government for the special importation of the article; it is indeed the only safe way in which parties can proceed.[26]

[Sidenote: Subjects of an Ally may not trade with the Enemy.]

During a Conjoint War no Subject of an Ally can trade with the common enemy without liability to forfeiture in the prize courts of the Ally, of all his property engaged in such trade. As the former rule can be relaxed only by permission of the Sovran power of the state, so this can be relaxed only by the permission of the allied nations, according to their mutual consent.[27]

[Sidenote: Contracts void.]

On similar principles, all Contracts made with the Enemy _during War_ are utterly _void_. This applies to Insurances on the enemy's property and trade; to the drawing and negociation of Bills of Exchange, whether the subject of this country or of the alien enemy be the acceptor; to the sending of Money or Bills to the enemy's country; to Commercial Partnerships. All endeavours to trade by third persons are equally illegal.[28]

Thus also all Contracts made in contemplation of War, and which never could have existed at all, but as an insurance against the pressure of war, and with a view to evade the rights that arise out of war, and in fraud of the belligerent, are illegal, even though made by neutrals.[29]

[Sidenote: Insurances.]

The munic.i.p.al or common law of every state declares all Insurances to be void, by which ships or merchandize of the enemy are sought to be protected. Also all Insurances by or on behalf of _alien_ enemies are wholly illegal and void, although effected before the breaking out of hostilities; but if both the policy had been effected and the loss accrued before the war, the remedy is only suspended during the war.

The general principle is that the contract of a.s.surance is vacated and annulled _ab initio_; wherever an insurance is made on a voyage expressly prohibited by the common, statute, or maritime law of the country; the policy is of no effect.[30]

Thus, if a ship, though neutral, be insured on a voyage prohibited by an embargo laid on in time of war, by the prince of the country in whose ports the ships happen to be, such an insurance is void.[31]

Similarly, all Insurances to protect the interests of British subjects trading without licence with the enemy are absolutely void.[32]

So also, if a Licence is not strictly pursued, so that the voyage becomes illegal, the insurance is void.[33]

I have said that all Insurances will be void which are designed to protect voyages or trading to hostile ports. But, for this purpose, it must be clearly made out, not only that the port into which the ship sails is hostile, but also, that she was bound with a distinct hostile destination at the time of loss. Thus a policy to "ports in the Baltic," is legal, as some may be hostile, and some not, and it is not certain that she was sailing to a hostile port.

The general principle by which the validity of a policy is to be tested, is by the voyage, that it is a voyage prohibited by law, on some ground of public policy. The will, therefore, of the parties is of no account, as the prohibition is for public, and not private benefit. So that if the underwriter is told that the voyage is illicit he is not more bound than if he were not told so.[34]

It is Insurances upon voyages generally prohibited by law, such as to an enemy's garrison, or upon a voyage directly contrary to an express act of parliament, or to royal proclamation in time of War, that are absolutely void and null;--therefore, on neutral vessels, or the vessels of British subjects possessing neutral rights and sailing from neutral ports to enemies ports are not void.[35]

Similarly, with respect to Insurances on neutral vessels carrying _contraband goods_, for it is not the voyage, but the cargo, that is illegal in that case.[36]

Insurances are good on Neutral Vessels engaged in the Colonial Trade of the Enemy, and which was closed to the Neutral in time of peace,[37] It must be observed, that if a voyage is illegal, and voids the policy for that voyage, it does not follow that it voids the voyage in the opposite direction, and even the goods purchased by the proceeds of a former illegal voyage, may be the subject of Insurance.[38]

[Sidenote: Bills of Exchange drawn during War.]

It has been stated above that all Bills drawn or negociated with the enemy, whether a British subject or the alien enemy be the acceptor, are null and void; during the last war, however, attempts were often made to draw and negociate bills that should pa.s.s muster in our courts of law, as for example:--

An alien enemy, during war, drew upon a British subject resident in England, and who had funds of the alien in his hands; the drawer then indorsed the bill to an English-born subject, resident in the hostile country; such a bill cannot be enforced even after the restoration of peace, for otherwise it would enable alien enemies to take the benefit of all their property in this country, by allowing them to pay debts out of such funds, by the instrumentality of bills.[39]

The principle seems to be,--that it is not every bill that bears the name of an alien enemy upon it that is void, but such bills only that are instrumental in a.s.sisting in communication with an alien enemy;--and a liberal application of this principle has been made use of to open a way for English prisoners to make use of their property at home for their support in the country of their captivity. Thus, where one of two Englishmen, detained in France on the breaking out of hostilities, drew in favour of the other, upon a subject here, it was held that he might legally draw such a bill for his _subsistence_, and that he might indorse it to an alien enemy, an inhabitant of the hostile country; for he could not avail himself of the bill except by negociation; and to whom could he negociate it, except to the inhabitants of the country in which he resided?[40]

Bills, like other contracts, are only void by the policy of war; but the law still recognizes some extent of obligation between the parties, so that bills void in their concoction (as instruments of trade with the enemy,) are not so far void that they may not const.i.tute the basis of a promise by which a party may bind himself on the return of peace.[41]

[Sidenote: Contracts made before the War.]

On the very important question of the effect of a declaration on Contracts with the subjects or the enemy, _entered into previous to the War_, the rule is, that if the performance of the contract be rendered unlawful by the Government of the country, the contract is dissolved on both sides.[42]

Thus the contract of Affreightment is dissolved when the voyage becomes unlawful, by the commencement of war, or the interdiction of commerce;[43] and this whether the interdiction is complete as to the ship, or partial as to the receiving of goods.

Similarly, if the voyage be broken up by Capture on the pa.s.sage, so as to cause a _complete defeat_ of the undertaking, the contract is dissolved, notwithstanding a recapture.[44]

A Blockade of the port of destination, that renders the delivery of the cargo impossible, and obliges the ship to return to its port of destination, dissolves the contract.[45]

A temporary interruption of the voyage does not put an end to the agreement. Embargoes, hostile blockades, and investments of the port of departure are held to be temporary impediments only.[46]

But in the case of an Embargo imposed by the government of the country, of which the merchant is a subject, in the nature of reprisals and partial hostility, against the enemy to which the ship belongs, the merchant may put an end to the contract, if the object of the voyage is likely to be defeated thereby; as if, for example, the cargo were of a perishable nature.[47]

[Sidenote: Partnerships.]

A Public War operates as a positive dissolution of Partnerships between subjects of the contending nations. Every Partnership is dissolved by the extinction of the business for which it was formed.[48] By a declaration of War, the respective subjects of each country become positive enemies to each other. They can carry on no commercial or other intercourse with each other; they can make no valid contracts with each other; they can inst.i.tute no suits in the courts of either country; they can, properly speaking, hold no communication of an amicable nature, with each other; and their property is mutually liable to capture and confiscation by the subjects of the other country. The whole objects and ends of the Partnership, the application of the joint funds, skill, labour, and enterprize of all the Partners of the common business, can no longer be attained.[49]

Thus a Partnership between alien friends, is at once defeated when they become alien enemies.

This dissolution, however, only has respect to the future. The parties remain bound for all antecedent engagements. The partnership may be said to continue as to everything that is past, and until all pre-existing matters are wound up and settled. With regard to things past, the partnership continues, and must always continue.

No notice is necessary to the world to complete the dissolution of the a.s.sociation. Notice is requisite when a partnership is dissolved by the act of the parties, but it is not necessary when the dissolution takes place by the act of law. All mankind are bound to take notice of the War, and its consequences. Besides, any special notice would be useless unless joint, and as the partners could hold no lawful intercourse, a lawful joint notice is impossible.

It must not be supposed that peace will have any healing effect, to restore the parties to their rights; the co-partnership being once dissolved by the war, it was extinguished for ever, except as to matters existing prior to the war.[50]

With regard to the effect of war upon partnerships, where the partners are severally subjects of the belligerent powers. According to Mr.

Justice Story,

"this point does not seem to have been discussed in our courts of justice until a recent period; yet it would seem to be a necessary result of principles of public law, well established and defined. By a declaration of war, the respective subjects of each country become positive enemies of each other. They can carry on no commercial or other intercourse with each other; they can make no valid contracts with each other; they can inst.i.tute no suits in the courts of either country; they can, properly speaking, hold no communication of an amicable nature with each other; and their property is mutually liable to capture and confiscation, by the subjects of either country. Now, it is obvious from these considerations, that the whole ends and objects of the partnership, the application of the joint funds, skill, labours, and enterprize, of all the partners in the common business thereof, can no longer be attained.

The conclusion therefore, would seem to be absolutely that this mutual supervening capacity, must, upon the very principles applied to all a.n.a.lagous cases, amount to a positive dissolution of the partnership."[51]

The law of nations has not even stopped at the points already stated; it proceeds further. The question of enemy or no enemy, depends not upon the natural allegiance of the partners, but upon their domicile.

[Sidenote: Partnerships.]

If a partnership is established, and as it were domiciled, in a neutral country, and all the partners reside there, it is treated as a neutral establishment, and is ent.i.tled to protection accordingly. But if one or more of the partners is domiciled in an enemy's country, he or they are treated personally as enemies, and his share of the partnership property is liable to capture and condemnation accordingly, even though the partnership establishment is in the neutral country. The inference from these considerations is, that in all these cases there is an utter incompatibility from operation of law between the partners, as to their respective rights, duties, and obligations, both public and private; and therefore, that a dissolution must necessarily result therefrom, independent of the will or acts of the parties.[52]

And, as a general rule, therefore, it may be laid down, that if the performance of a covenant be rendered unlawful by the Government of this country entering into war, the contract will be dissolved on both sides, and the offending party, as he has been compelled to abandon his contract, will be excused from the payment of damages for its non-performance; but it is otherwise, if the non-performance is prevented only by the prohibition of a foreign country.[53]

In such cases, the remedy only is suspended; and other cases may occur on these principles, where, from other circ.u.mstances, the remedy only is suspended until the termination of the war; as for example, in most cases of executed contracts.

[Sidenote: Trading with the Enemy punishable.]

Trading with the Enemy, was at an early period an indictable offence in the English Court of Admiralty.[54] And in the time of King William, it was held to be a misdemeanor at common law, to carry corn to an enemy.[55]

The law, as I have faintly sketched it out, is founded to some extent on American authorities, where the question has been as fully discussed as in the reports of this country; but there can be little doubt that the law is the same in this country: although a doubt was once thrown on it, by the strong political opinion of Lord Mansfield, as to the policy of allowing trade with an enemy, or a.s.suring an enemy's property. The l.u.s.tre of his talents, and his ascendancy in the Court of King's Bench, were calculated to continue the delusion.