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Grey's memorandum is set out, commencing one-third down the page:

"The American fishery, under Article I of the Convention of 1818, is one carried on within the British jurisdiction and in common with' British subjects. The two Governments hold different views as to the nature of this Article. The British Government consider that the war of 1812 abrogated that part of Article III of the Treaty of Peace of 1783 which continued to inhabitants of the United States 'the liberty' (in the words used by Mr. Adams to Earl Bathurst in his note of the 25th September, 1815) of fishing and drying, and curing their fish within the exclusive jurisdiction on the North American coasts to which they had been accustomed while themselves forming a part of the British nation,' and that consequently Article I of the Convention of 1818 was a new grant to inhabitants of the United States of fishing privileges within the British jurisdiction. The United States' Government, on the other hand, contend that the war of 1812 had not the effect attributed to it by the British Government, and that Article I of the Convention of 1818 was not a new grant, but merely a recognition (though limited in extent) of privileges enjoyed by inhabitants of the United States prior, not only to the war, but to the Treaty of 1783. Whichever of these views be adopted, it is certain that inhabitants of the United States would not now be entitled to fish in British North American waters but for the fact that they were entitled to do so when they were British subjects. American fishermen cannot therefore rightly claim to exercise their right of fishery under the Convention of 1818 on a footing of greater freedom than if they had never ceased to be British subjects."

To that Mr. Root makes the reply, which will be found upon p. 499, the second paragraph from the bottom :

"The proposition that 'the inhabitants of the United States would not now be entitled to fish in British North American waters but for the fact that they were entitled to do so when they were British subjects,' may be accepted as a correct statement of one of the series of facts which led to the making of the Treaty of 1818. Were it not for that fact there would have been no fisheries Article in the Treaty of 1783, no controversy between Great Britain and the United States as to whether that Article was terminated by the war of 1812, and no settlement of that controversy by the Treaty of 1818. The Memorandum, however, expressly excludes the supposition that the British Government now intends to concede that the present rights of American fishermen upon the Treaty coast are a continuance of the right possessed by the inhabitants of the American Colonies as British subjects, and declares that this present American right is a new grant by the Treaty of 1818. How then can it be maintained that the limitations upon the former right continued although the right did not, and are to be regarded as imposed upon the new grant, although not expressed in the instrument making the grant? On the contrary, the failure to express in the terms of the new Treaty the former limitations, if any there had been, must be deemed to evidence an intent not to attach them to the newly created right.

"Nor would the acceptance by Great Britain of the American view that the Treaty of 1783 was in the nature of a partition of

Empire, that the fishing rights formerly enjoyed by the people of the Colonies and described in the instrument of partition continued notwithstanding the war of 1812, and were in part declared and in part abandoned by the Treaty of 1818. lead to any different conclusion. It may be that under this view the rights thus allotted to the Colonies in 1783 were subject to such Regulations as Great Britain had already imposed upon their exercise before the partition, but the partition itself and the recognition of the independence of the Colonies in the Treaty of partition was a plain abandonment by Great Britain of the authority to further regulate the rights of the citizens of the new and independent nation."

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That Mr. Root's opinion was such as one would gather from the extract which I have now read may be seen at p. 502 of the British Case Appendix in a passage in a letter from Congressman Gardner, which was published in the " Boston Herald." This Mr. Gardner is no doubt the same man as is referred to in Mr. Root's first letter to the British representative at Washington, which occurs on p. 491 of the British Case Appendix. Mr. Root there commenced his letter by saying:

"Mr. Gardner, the representative in Congress of the Gloucester district, has placed in my hands a number of despatches received by him from masters of American vessels now on the Newfoundland coast. These despatches are answers to inquiries sent by him at my request for the purpose of ascertaining definitely, if possible, what is the precise difficulty there."

This Congressman Gardner evidently was in close touch with the United States Secretary of State, and in his letter (British Case Appendix, p. 491) he indicates the view of the State Department. The tribunal will observe that the second paragraph of the letter purports to reflect the view held by the department with reference to purse seining:—

"The State Department holds that the local regulation prohibiting purse seining is unreasonable as against American fishermen."

Then, in the clause at the end of p. 502, are these words:

"My advice as to the coming fishing season is to refrain from shipping British subjects in British waters or British ports. I am aware, of course, that this advice, if carried out practically precludes gill netting for the coming season, unless that operation is carried on by combining the crews of several vessels. The State Department is now contending with the Government of Great Britain that Newfoundland had no right to interfere with our fishermen by any regulation that did not exist when the Treaty of 1818 was made. At the same time we have offered to join with Great Britain in agreeing to reasonable regulations. The courses of diplomacy, however, are so slow that I do not believe it would be possible to arrive at any definite conclusion prior to 1907."

I think that we may therefore take it that the traditional view which the United States has held from 1814 down to 1907 necessi

tates the admission that regulations existing prior to the treaty would be binding upon United States fishermen. The only question remaining would be whether there is any difference between prior regulations and subsequent regulations. Upon that point I do not think that I can do better than refer to Mr. Evarts' argument at p. 284 of the British Case Appendix, in which he contends most strongly, and in a passage that received the commendation of Senator Turner, that there can be no difference between prior regulations and subsequent regulations. The passage has been already read to the Tribunal, and it is not necessary that I should read it again.

We therefore have this extraordinary situation, that the only two men in the United States that have ever, on the part of the United States, disputed the right of British legislatures to frame regulations binding upon United States citizens are Mr. Evarts and Mr. Root; and that if we combine the opinions of these two men the British view is established. For Mr. Root seems to admit that, as to prior regulations, the United States fishermen would be bound, and Mr. Evarts' argument is that there can be no difference between prior and subsequent regulations.

The point to which we must always come back is, no doubt, the construction of the treaty, and the question is whether the liberty to fish implies an abandonment of the sovereign power to regulate. And as some assistance to the construction of the treaty I wish to refer to an article in the United States Constitution which provides that no State shall pass any law impairing the obligation of contracts. I wish to point out what has been the course of decision with reference to that clause in the Constitution: "No State shall pass any law impairing the obligation of contracts." Does that mean that contracts cannot be affected in any way by United States legislation, or is there some more modified meaning to be attached to it?

At a very early stage of American judicial decision, it was held that the clause related not only to contracts between individuals, but to charters granted by State legislatures to companies-that those charters were actually contracts as between the State and the company that was incorporated by the charter. The clause of the constitution, therefore, applied to those contracts, and constituted a prohibition as against any legislation which should impair the charters of corporations.

Many cases have been decided with relation to that question. The principle to be applied has, I think, now been sufficiently clearly established; but the application of that principle is of constantly recurring difficulty. I cannot do better, I think, than read some passages from Cooley on limitations, one of the standard works in the United States, as to what the effect of the decisions has been. At 92909-S. Doc. 870, 61–3, vol 10- -35

870 p. 574-I am reading from the third edition of Cooley--the subject is considered with reference to contracts between individuals; and then, at p. 575, the learned author continues in this way:

"Perhaps the most striking illustrations of the principle here stated will be found among the judicial decisions which have held that the rights insured to private corporations by their charters, and the manner of their exercise, are subject to such new regulations as from time to time may be made by the State with a view to the public protection, health, and safety, and in order to guard properly the rights of other individuals and corporations. Although these charters are to be regarded as contracts, and the rights assured by them are inviolable, it does not follow that these rights are at once, by force of the charter-contract, removed from the sphere of State regulation, and that the charter implies an undertaking, on the part of the State, that in the same way in which their exercise is permissible at first, and under the regulations then existing, and those only, may the corporators continue to exercise their rights while the artificial existence continues. The obligation of the contract by no means extends so far; but, on the contrary, the rights and privileges which come into existence under it are placed upon the same footing with other legal rights and privileges of the citizen, and subject in like manner to proper rules for their due regulation, protection, and enjoyment.

The limit to the exercise of the police power in these cases must be this: the regulations must have reference to the comfort, safety, or welfare of society; they must not be in conflict with any of the provisions of the charter;

They must not be inconsistent with the treaty, we would say here-

"and they must not, under pretence of regulation, take from the corporation any of the essential rights and privileges which the charter confers. In short, they must be police regulations in fact, and not amendments of the charter in curtailment of the corporate franchise. The maxim, Sic utere tuo ut alienum non ladas, is that which lies at the foundation of the power; and to whatever enactment affecting the management and business of private corporations it cannot fairly be applied, the power itself will not extend. It has accordingly been held that where a corporation was chartered with the right to take toll from passengers over their road, a subsequent statute authorising a certain class of persons to go toll free was void. This was not a regulation of existing rights, but it took from the corporation that which they before possessed, namely, the right to tolls, and conferred upon individuals that which before they had not, namely, the privilege to pass over the road free of toll. Powers,' it is said in another case, which can only be justified on this specific ground [that they are police regulations], and which would otherwise be clearly prohibited by the Constitution, can be such only as are so clearly necessary to the safety, comfort, and well-being of society, or so imperatively required by the public necessity, as to lead to the rational and satisfactory conclusion that the framers of the Constitution could not, as men of ordinary prudence and foresight, have intended to prohibited their exercise in the particular case, notwithstanding the

language of the prohibition would otherwise include it.' And it was therefore held that an act subsequent to the charter of a plank-road company, and not assented to by the corporators, which subjected them to a total forfeiture of their franchises for that which by the charter was cause for partial forfeiture only, was void as violating the obligation of contracts."

Passing some further illustrations which the author gives, I proceed to a subsequent paragraph:-

"On the other hand, the right to require existing railroad corporations to fence their track, and to make them liable for all beasts killed by going upon it, has been sustained on two grounds: first, as regarding the division fence between adjoining proprietors, and in that view being but a reasonable provision for the protection of domestic animals; and second, and chiefly, as essential to the protection of persons being transported in the railway carriages. Having this double purpose in view, the owner of beasts killed or injured may maintain an action for the damage suffered, notwithstanding he may not himself be free from negligence. But it would, perhaps, require an express legislative declaration that the corporation should be liable for the beasts thus destroyed to create so great an innovation in the common law. The general rule, where a corporation has failed to obey the police regulations established for its government, would not make the corporation liable to the party injured, if his own negligence contributed with that of the corporation in producing the injury.

"The State may also regulate the grade of railways, and prescribe how, and upon what grade, railway tracks shall cross each other; and it may apportion the expense of making the necessary crossings between the corporations owning the roads. And it may establish regulations requiring existing railways to ring the bell"

And so on. Then, a little further on:

"And it cannot be doubted that there is ample power in the legislative department of the State to adopt all necessary legislation for the purpose of enforcing the obligations of railway companies as carriers of persons and goods to accommodate the public impartially, and to make every reasonable provision for carrying with safety and expedition."

I submit, Sirs, that we have here a very sufficient reply to the various arguments of the United States:

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To the argument that, because there is no reservation of sovereignty, and no limitation or qualification of the granted liberty, therefore the State is powerless to exercise the sovereign power with a view to the public welfare; to the preservation of the subject-matter of the contract:

Secondly, to the argument that a right to exercise the sovereign Power to make regulations for such a purpose is not, as alleged in the present case (United States Argument, p. 62) :—

"in its practical effect different from the power to make regulations at will and without limitation as to character, when the state which

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