other dealing therewith may be charged by that allied or associated power in the first place with payment of amounts due in respect of claims by the nationals of that allied or associated power with regard to their property, rights, and interests, including companies and associations in which they are interested, in German territory, or debts owing to them by German nationals, and with payment of claims growing out of acts committed by the German Government or by any German authorities since July 31, 1914, and before that allied or associated power entered into the war."

It will be seen from these quotations that the right of the United States to retain and utilize German property held by the Alien Property Custodian is determined by the provisions of the treaty of Versailles which must be considered as superseding any contrary provisions in earlier treaties between the United States and Germany.

No treaty between the United States and Germany, other than those discussed herein, has any bearing on the question under consideration. The treaty of 1785 between the United States and Prussia, Article XXIII of which is similar to Article XXIII of the treaty of 1799, has no bearing on the present question, since that treaty expired by its own limitations in October, 1796. While Article XII of the treaty of 1785 was revived by Article XII of the treaty of 1799 and later by Article XII of the treaty of 1828, no such action was taken with respect to any other article of that treaty.

Mr. MILLS. Would it also be possible for the State Department to let us have a brief statement as to what its conception of what the international law was on this subject prior to the World War? Mr. OLDS. We can attempt to do that.

Mr. NEWTON. That would take in the treaty of 1785, and also the one later than 1785 and prior to the treaty of 1828, because they were referred to in the treaty of 1828, were they not?

Mr. OLDS. I do not know.

Mr. NEWTON. That is my recollection, and that it applied almost wholly to merchants.

Mr. OLDS. Yes.

(The statement above referred to is as follows:)

The following quotations from the authorities cited will throw light on the status of international law prior to the World War relating to the rights of belligerents with respect to privately owned enemy property within their territories and on the practice followed by the United States with respect to private enemy property.

"4. Confiscation of property.-But however strong the current of authority in favor of the modern and milder construction of the rule of national law on this subject, the point seems to be no longer open for discussion in this country; and it has become definitively settled, in favor of the ancient and sterner rule, by the Supreme Court of the United States. (a) The effect of war upon British property found in the United States, on land, at the commencement of the war was learnedly discussed and thoroughly considered, in the case of Brown; and the Circuit Court of the United States at Boston decided, (b) as upon a settled rule of the law of nations, that the goods of the enemy found in the country, and all the vessels and cargoes found afloat in our ports, at the commencement of hostilities, were liable to seizure and confiscation; and the exercise of the right rested in the discretion of the sovereign of the nation. When the case was brought up, on appeal, before the Supreme Court of the United States, the broad principle was assumed that war gave to the sovereign full right to take the persons, and confiscate the property of the enemy wherever found; and that the mitigations of this rigid rule, which the wise and humane policy of modern times had introduced into practice, might, more or less, affect the exercise of the right, but could not impair the right itself. Commercial nations have always considerable property in the possession of their neighbors; and, when war breaks out, the question, What shall be done with enemy's property found in the country, is one rather of policy than of law, and is one properly addressed to the consideration of the legislature, and not to the courts of law. The strict right of confiscation of that species of property existed in Congress, and without a legislative act authorizing its confiscation, it could not be judicially condemned; and the act of Congress of 1812, declaring war against Great Britain, was not such an act. Until some

statute, directly applying to the subject, be passed, the property would continue under the protection of the law, and might be claimed by the British owner at the restoration of peace.

"Though this decision established the right, contrary to much of modern authority and practice, yet a great point was gained over the rigor and violence of the ancient doctrine, by making the exercise of the right to depend upon a special act of Congress." (I Kent's Commentaries, 12th Edition, p. 68).

"5. Confiscation of debts.-The claim of a right to confiscate debts, contracted by individuals in time of peace, and which remain due to subjects of the enemy at the declaration of war, rests very much upon the same principles as that concerning enemy's tangible property found in the country at the opening of the war, though I think the objection to the right of confiscation, in this latter case, is much stronger.' (I Kent's Commentaries, 12th Edition, p. 71.)

"Notwithstanding the weight of modern authority and of argument against this claim of right on the part of the sovereign, to confiscate the debts and funds of the subjects of his enemy during war, the judicial language in this country is decidedly in support of the right. In the case of Brown v. The United States, (b) already mentioned, Judge Story, in the circuit court in Massachusetts, laid down the right to confiscate debts and enemy's property found in the country, according to the rigorous doctrine of the elder jurists; and he said the opinion was fully confirmed by the judgment of the Supreme Court in Ware v. Hylton, (c) where the doctrine was explicitly asserted by some of the judges, reluctantly admitted by others, and denied by none. Chief Justice Marshall, in delivering the opinion of the Supreme Court in the case of Brown, observed that between debts contracted under the faith of laws and property acquired in the course of trade on the faith of the same laws, reason drew no distinction, and the right of the sovereign to confiscate debts was precisely the same with the right to confiscate other property found in the country. This right, therefore, was admitted to exist as a settled and decided right, stricto jure, though at the same time it was conceded to be the universal practice to forbear to seize and to confiscate debts and credits. We may, therefore, lay it down as a principle of public law, so far as the same is understood and declared by the highest judicial authorities in this country, that it rests in the discretion of the Legislature of the Union, by a special law for that purpose, to confiscate debts contracted by our citizens, and due to the enemy; but, as it is asserted by the same authority, this right is contrary to universal practice, and it may, therefore, well be considered as a naked and impolitic right, condemned by the enlightened conscience and judgment of modern times." (I Kent's Commentaries, 12th Edition, p. 73.) It will be noted from the foregoing that the decision of the Supreme Court in Ware v. Hylton (3 Dallas, 199) is regarded as authority for the proposition that under the law of nations debts owing enemy subjects are confiscable and that the decision of the Supreme Court in Brown v. The United States (8 Cranch, 110) is cited as authority on the proposition that private enemy property is subject to confiscation.

The rights of belligerents with respect to property of enemy nationals under the law of nations were exhaustively discussed in the opinions of the circuit courts which the Supreme Court was reviewing in Ware v. Hylton and Brown v. The United States. The rights were also exhaustively discussed by the members of the Supreme Court. It is clear from the decisions of the circuit courts that they regarded enemy debts and other enemy property subject to confiscation. In Ware v. Hylton the circuit court expressed the opinion that the right of confiscation existed and ruled that payment by a person indebted to a British subject into a loan office, pursuant to an act of Legislature of the State of Virginia, authorizing such a course, extinguished the debt owing the British subject by the American citizen, and that the British subject could not recover on the debt in an action against the American citizen, notwithstanding a provision in the peace treaty of 1783 between the United States and Great Britain that "it is agreed that creditors on either side shall meet with no lawful impediment to the recovery to the full value in sterling money of all bona fide debts heretofore contracted." The Supreme Court reversed the circuit court and ruled that the British national was entitled to recover from the American citizen notwithstanding that the American citizen had paid the debt into the loan office established by the State of Virginia for that purpose. The justices of the Supreme Court, in the separate opinions rendered by them in this case, appear carefully to have reserved the right of a belligerent to confiscate debts of the enemy. It has been said that the right of confiscation of debts was explicitly asserted by some of the judges in Ware v. Hylton, reluctantly admitted by others, and denied by none.

In Brown v. the United States, the circuit court condemned the property which was found on land and which belonged to a British national. The circuit Surt held that the executive could lawfully authorize proceedings to enforce confiscation of property before the courts. The circuit court was reversed by the Supreme Court. In the opinion delivered by Chief Justice Marshall it was stated that no doubt was entertained regarding the power of the belligerent Government to confiscate private enemy property; that it was conceded that war gave to the sovereign full right to take the persons and confiscate the property of the enemy wherever found; that the mitigations of this rigid rule, which the humane and wise policy of modern times had introduced into practice, would more or less affect the exercise of the right, but could not impair the right itself. The Supreme Court reversed the circuit court on the ground that the right of confiscation should be exercised through the instrumentality of an act of Congress and that the executive had not authority to enforce confiscation.

The following quotation from Oppenheim on the subject of private enemy property and enemy debts is pertinent:

"In former times all private and public enemy property, immovable or movable, on each other's territory could be confiscated by the belligerents at the outbreak of war, as could also enemy debts; and the treaties concluded between many States with regard to the withdrawal of each other's subjects at the outbreak of war stipulated likewise the unrestrained withdrawal of the private property of their subjects. Through the influence of such treaties as well as of municipal laws and decrees enacting the same, an international usage and practice grew up that belligerents should neither confiscate private enemy property nor annul enemy debts on their territory. The last case of confiscation of private property is that of 1793 at the outbreak of war between France and Great Britain. No case of confiscation occurred during the nineteenth century, and although several writers maintain that according to strict law the old rule, in contradistinction to the usage which they do not deny, is still valid, it may safely be maintained that it is obsolete, and that there is now a customary rule of international law in existence prohibiting the confiscation of private enemy property and the annulment of enemy debts on the territory of a belligerent." (Oppenheim's International Law, 2d Edition, Vol. II, p. 139.)

As to the policy or practice of the United States with respect to the treatment of enemy property, it may be stated that at no time since the Constitution of the United States was adopted has the Government of the United States confiscated property found in its territory solely on the ground of enemy ownership. It will be observed that Oppenheim states in the quotation set forth above that the last case of confiscation of private property was that of 1793, at the outbreak of the war between France and England.

As indicative of the official view in the United States in the early days of the Republic on the subject of the confiscation of debts, reference may be made to Moore's International Arbitrations, volume 1, page 271. It will be observed from the discussion there recorded that in the treaty of 1794 between the United States and Great Britain, the two Governments agreed to establish a commission to determine the amounts due British nationals on debts contracted by them with American citizens. Proceedings of the commission having been suspended because of disagreement, the United States agreed in a treaty concluded in 1802 to pay the sum of 600,000 pounds sterling in satisfaction of the amount which the United States might have been obligated to pay under article 6 of the treaty of 1794.

Mr. OLDS. A very careful and comprehensive study of the question of the treatment to be accorded to enemy property in belligerent territory may be found on pages 150 to 202 of a pamphlet published in 1919 by the Government Printing Office under the title "Selected Topics Connected with the Laws of Warfare, as of August 1, 1914." This pamphlet was prepared by the division of international law of the Carnegie Endowment for International Peace and contains, I believe, much that will be of assistance to the committee. I know of no more convenient or comprehensive compilation of the authorities.

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As of possible interest in connection with the initiation of the policy regarding the treatment to be accorded to the property of merchants laid down in the treaties of 1785, 1799, and 1828 with Prussia, I also submit an extract from the Secret Journals of the Acts and Proceedings of Congress, volume 3, page 484. Paragraph 4 is the relevant paragraph.

(The paper referred to is as follows:)

[Secret Journals of the Acts and Proceedings of Congress, vol. 3, p. 484, May 7, 1784]

On the report of the committee, to whom was recommitted their report on sundry letters from the ministers of the United States in Europe, Congress came to the following resolutions:

Whereas instructions, bearing date the 29th day of October, 1783, were sent to the ministers plenipotentiary of the United States of America at the court of Versailles empowered to negotiate a peace, or to any one or more of them, for concerting drafts or propositions for treaties of amity and commerce with the commercial powers of Europe:

Resolved, That it will be advantageous to these United States to conclude such treaties with Russia, the court of Vienna, Prussia, Denmark, Saxony, Hamburg, Great Britain, Spain, Portugal, Genoa, Tuscany, Rome, Naples, Venice, Sardinia, and the Ottoman Porte.

Resolved, That in the formation of these treaties the following points be carefully stipulated:

1. That each party shall have a right to carry their own produce, manufactures, and merchandise, in their own bottoms to the ports of the other; and thence to take the produce and merchandise of the other, paying, in both cases, such duties only as are paid by the most favoured nation, freely where it is freely granted to such nation, or paying the compensation, where such nation does the same.

2. That with the nations holding territorial possessions in America, a direct and similar intercourse be admitted between the United States and such possessions; or if this can not be obtained, then a direct and a similar intercourse between the United States and certain free ports within such possessions; that if this neither can be obtained, permission be stipulated to bring from such possessions, in their own bottoms, the produce and merchandise thereof to these States directly; and for these States to carry in their own bottoms their produce and merchandise to such possessions directly.

3. That these United States be considered in all such treaties, and in every case arising under them, as one nation upon the principles of the Federal Constitution.

4. That it be proposed, though not indispensably required, that if war should hereafter arise between the two contracting parties, the merchants of either country then residing in the other, shall be allowed to remain nine months to collect their debts and settle their affairs, and may depart freely, carrying off all their effects without molestation or hindrance; and all fishermen, all cultivators of the earth, and all artisans or manufacturers, unarmed and inhabiting unfortified towns, villages, or places, who labour for the common subsistence and benefit of mankind, and peaceably following their respective employments, shall be allowed to continue the same, and shall not be molested by the armed force of the enemy, in whose power by the events of war they may happen to fall; but if anything is necessary to be taken from them for the use of such armed force, the same shall be paid for at a reasonable price; and all merchants and traders exchanging the products of different places, and thereby rendering the necessaries, conveniences, and comforts of human life more easy to obtain and more general, shall be allowed to pass free and unmolested; and neither of the contracting powers shall grant or issue any commission to any private armed vessels empowering them to take or destroy such trading ships, or interrupt such commerce.

5. And in case either of the contracting parties shall happen to be engaged in war with any other nation, it be further agreed, in order to prevent all the difficulties and misunderstandings that usually arise respecting the merchandise heretofore called contraband, such as arms, ammunition, and military stores of all kinds, that no such articles carrying by the ships or subjects of one of the parties to the enemies of the other, shall on any account be deemed contraband

so as to induce confiscation and a loss of property to individuals. Nevertheless, it shall be lawful to stop such ships and detain them for such length of time as the captors may think necessary to prevent the inconvenience or damage that might ensue from their proceeding on their voyage, paying, however, a reasonable compensation for the loss such arrest shall occasion to the proprietors; and it shall further be allowed to use, in the service of the captors, the whole or any part of the military stores so detained, paying the owners the full value of the same, to be ascertained by the current price at the place of its destination. But if the other contracting party will not consent to discontinue the confiscation of contraband goods, then that it be stipulated that if the master of the vessel stopped will deliver out the goods charged to be contraband, he shall be admitted to do it, and the vessel shall not in that case be carried into any port, but shall be allowed to proceed on her voyage.

6. That in the same case, where either of the contracting parties shall happen to be engaged in war with any other power, all goods not contraband belonging to the subjects of that other power, and shipped in the bottoms of the party hereto, who is not engaged in the war, shall be entirely free. And that to ascertain what shall constitute the blockade of any place or port, it shall be understood to be in such predicament, when the assailing power shall have taken such a station as to expose to imminent danger any ship or ships that would attempt to sail in or out of the said port; and that no vessel of the party who is not engaged in the said war shall be stopped without a material and well-grounded cause; and in such cases justice shall be done, and an indemnification given, without loss of time to the persons aggrieved and thus stopped without sufficient cause.

7. That no rights be stipulated for aliens to hold real property within these States, this being utterly inadmissible by their several laws and policy; but where on the death of any person holding real estate within the territories of one of the contracting parties, such real estate would by their laws descend on a subject or citizen of the other, were he not disqualified by alienage, there he shall be allowed a reasonable time to dispose of the same, and withdraw the proceeds without molestation.

8. That such treaties be made for a term not exceeding ten years for [from] the exchange of ratifications.

9. That these instructions be considered as supplementary to those of October 29, 1783; and not as revoking, except where they contradict them. That where, in treaty with a particular nation, they can procure particular advantages, to the specification of which we have been unable to descend, our object in these instructions having been to form outlines only, and general principles of treaty with many nations, it is our expectation they will procure them, though not pointed out in these instructions; and where they may be able to form treaties on prineiples which in their judgment will be more beneficial to the United States than those herein directed to be made their basis, they are permitted to adopt such principles. That as to the duration of the treaties, though we have proposed to restrain them to the term of ten years, yet they [are] at liberty to extend the same as far as fifteen years with any nation which may pertinaciously insist thereon. And that it will be agreeable to us to have supplementary treaties with France,' the United Netherlands, and Sweden, which may bring the treaties we have entered into with them as nearly as may be to the principles of those now directed; but that this be not pressed if the proposal should be found disagreeable.

Resolved, That treaties of amity, or of amity and commerce, be entered into with Morocco, and the regencies of Algiers, Tunis, and Tripoli, to continue for the same term of ten years, or for a term as much longer as can be procured.

That our ministers to be commissioned for treating with foreign nations make known to the Emperor of Morocco the great satisfaction which Congress feel from the amicable disposition he has shown toward those States, and his readiness to enter into alliance with them. That the occupations of the war and distance of our situation have prevented our meeting his friendship so early as we wished. But the powers are now delegated to them for entering into treaty with him, in the execution of which they are ready to proceed. And that as to the expenses of his minister, they do therein what is for the honour and interest of the United States.

Resolved, That a commission be issued to Mr. J. Adams, Mr. B. Franklin, and Mr. T. Jefferson, giving powers to them, or the greater part of them, to make and receive propositions for such treaties of amity and commerce, and to negotiate and sign the same, transmitting them to Congress for their final ratification; and that such commission be in force for a term not exceeding two years.