(by implication) or any person in the Service of the Crown is exempted from legal proceedings in respect of any act done in good faith for the defence of the Colony or the prosectuion of the war after 8th December, 1941, the right to compensation under the Compensation (Defence) Act only being preserved. It appears therefore that in contrast to the United Kingdom probably no legal claim lics against the Hong Kong Government or any of the Services in respect of sinkings performed in the course of denial action for the defence of Hong Kong and the prosecution of the war, but this cannot be taken as certain until a case has come before the Courts.
(c)
Capture by the Japanese.
The owners of Hong Kong registered craft and of unregistered craft owned by firms persons whose principal place of business is Hong Kong which were captured, seized or requisitioned by the Japanese, or of which the owners were deprived of possession by the Japanese, whether they were finally lost or recovered, would appear to be entitled to a civil claim for damages against the Japanese, which in practice would take the form of a proportionate claim, administratively determined, against whatever amount of reparations, or their proceeds in money, ultimately became available to the Hong Kong Government from Japan. It is not likely that the same would apply to foreign registered or foreign owned craft captured by the Japanese in Hong Kong, any reparations claim in respect of which (unlike a claim in respect of fixed property) would presumably be made by the country of registration or ownership. Further in practice such claims would be limited to the owners of Craft not insured against war risks; underwriters might be held to be subrogated to the owners' rights in these cases, so that the total claim would not be diminished,but in practice underwriters would be unlikely to make a claim. No war damage compensation scheme was in force in Hong Kong. The relative amount of the claim might in theory have to take into account not merely the fact of loss or damage and the value, but owing to the special relationship between local residents of Chinese origin and the Japanese, the extent that the Japanese may have paid for the use of vessels. In practice owing to the smallness of the fund and the complication of establishing facts, only claims for loss or damage would probably be admitted, at whatever stage these took place, Although many of the ships were finally sunk by allied action, there is no question of any liability for claims falling on the Hong Kong Government or the Services and the Hong Kong Government's concern with claims will be solely in connection with whatever Reparations fund is obtained from Japan. It is unlikely that any similar legal claim could be established against the Japanese for the claims set out": in (b) above but it would probably be necessary from an administrative point of view to include such claims amongst those dealt with in this subparagraph.
MORAL OBLIGATIONS
4.
Although there is no doubt about the legal responsibility of the Hong Kong Government for the claims in respect of requisitioned ships, there is some question as to their moral responsibility.
(a)
The loglislation specifically provides (Regulation 6(1) (ii) of the Compensation (Defence) Regulations, 1940) that no total loss compensation shall be paid in respect of vehicles and aircraft (which in other respects are treated on the same lines as vessels) damaged or totally lost in consequence of war operations, unless the risk was materially increased by reason of the requisition. The principle behind this was that, if an owner was going to lose his car in any circumstances, whether requisitioned or not, there was no reason why, because it happened to be requisitioned at the time, the over should be able to claim on the Government, when if it had not been requisitioned he would have had no claim at all except against a Reparations fund.
For some