PUBLIC RECORD OFFICE
T ། :།:། །
C.O.
Reference :-
885
15 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH—NOT TO
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was that of the annexation of Upper Burmah in 1886. That Mr. Bertram Cox was 1.0. to C,O., to transmit, for our consideration, certain papers furnished to the Colonial Office 13 Sept.
by the India Office which showed the course adopted by the Indian Government in respect of claims and obligations arising out of such annexation. That it would be observed that the Indian Government declined to admit any claims unless based on service actually performed for the annexed State, or on account of goods supplied or money advanced for State purposes, and left it to claimants to show, if they could, that any wider interpretation had been placed on the general doctrine that a 'Govern ment taking territory by conquest inherited the liability of its predecessors.
Spicer
Sons, May
25.
2.
That the Indian Government excluded from consideration claims (a) for indemnity for loss of State employment, or for failure on the part of the Government to accept delivery of goods ordered, or to complete contracts; (b) for compensation for injuries sustained by military operations or on account of war; and (c) for payment on account either for work done for the late King or Queen of Upper That further, while Burmah or for goods supplied to, or ordered by, them. sanctioning payment of wages claimed by foreigners in certain cases, the Indian Government declined to satisfy claims by Burmese subjects for services rendered or goods supplied. That you had some doubt whether this precedent could be held That Upper Burmah was an to be of binding authority in the present case. uncivilized country, and it was possible that in dealing with such a State rules more favourable to the succeeding Government could be applied than in a case where two civilized States have been incorporated with Her Majesty's Dominions.
That the most important question which had up to the present time arisen in respect to the annexation of the South African Republic and Orange Free State, was the question whether Her Majesty's Government was bound to take over liabilities in respect of the public debts of the annexed States. That Mr. Bertram Cox was to enclose a Memorandum which had been prepared from such information as the Colonial Office possessed, which would show the nature of the liabilities of the Orange Free State in respect of its public debt, and of the South African Republic in respect to the five per cent, loan. That Mr. Bertram Cox was further to draw our attention to the judgment of Malins, V.C., in the case of Doss v. Secretary of State for India in Council (reported in L.R. 19 Equity at p. 530), in which it was stated that every State which took possession of the territories of another, took the annexed territories liable to the debts and loans which existed on its revenues. That assuming, therefore, that Her Majesty's Government were bound to take over, and did take over the public debts of the extinct Republics, the further question arose as to whether Her Majesty's Government were in this.case bound to carry out to the letter all the obligations of the late Republics, or whether they might modify those obligations, and decline to be bound by every term of the contracts entered into by the late Republics. That in view, for instance, of the increased security given for the payment of these loans by the substitution of the British Government, as a debtor for the extinct Government in each case, it would, it was submitted, not be inequit- able to reduce the rate of interest, and that you desire to know whether it would be legally competent for Her Majesty's Government, while acknowledging their liability to take over these loans, to give notice that they would be converted at an early date, and subsequently to carry out such conversion on terms based on its own credt.
That Mr. Bertram Cox was further to enclose copies of correspondence between Messrs. Spicer and Sons and the Colonial Office, and between the High Commissioner To Spicer & Sons, June for South Africa and the Colonial Office, with reference to a contract entered into by Messrs. Spicer and Sons with the Government of the South African Republic High Com- for the supply of postage stamp paper to that Government, as an instance of missioner, particular claims which would no doubt be presented against Her Majesty's Govern- August 29.
ment at no distant date.
That, in conclusion, Mr. Bertram Cox was to observe that even on the assumption that Her Majesty's Government, as the successors of the South African Republic, inherited generally the obligations as well as the rights of the late Republic, the further question arose whether their liability could be held to extend to any obliga- tion arising between the outbreak of war and annexation. That it was possible to argue that the outbreak of war created a situation during the contindance of which no obligations could, in the nature of things, arise which would legally pass from the enemy Government to Her Majesty's Government at the conclusion of hostilities. That in this connection Mr. Bertram Cox was to draw our attention to the High
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Commissioner's Notices of 26th January and 19th March, issued with the approval of the Law Officers, which expressly repudiated responsibility for certain classes of obligation, and that he was to add that it would seem in any case impossible to hold Her Majesty's Government responsible for certain liabilities, e.g., the liability to pay for warlike stores ordered and supplied during the war for the purpose of destroying Her Majesty's forces. That it was not, however, equally clear that Her Majesty's Government could be held to be free from liability to pay the interest on the ordinary public debt, or on the bonds of a Company with the Government guarantee accruing during the war and left unpaid by the late Republic. That in this connection Mr. Bertram Cox was to observe that, as would be seen from the cnclosed telegram from the High Commissioner, Lord Roberts was collecting certain taxes which were in arrear, and it would no doubt be argued on behalf of the bond- holders, that by claiming payment of arrears of taxes which tell due during the war, the new Government of the Transvaal must be held liable to accept fully and completely the obligations of the late Government.
That Mr. Bertram Cox was to request us to take the papers into our considera- tion, and to advise you :---
1. Were Her Majesty's Government legally bound to take over all the obliga- tions incurred by the Governments of the South African Republic and Orange Free State-
(a) Before the commencement of the war;
(b) During the war by the Governments of the South African Republic and
Orange Free State?
2. If not, what was the nature of the obligations which Her Majesty's Govern- ment were bound to take over, and what obligations was it entitled to repudiate, and on what grounds?
3. Were Her Majesty's Government bound to take over the obligations of the South African Republic and the Orange Free State in respect of the public debts of those States, and, if so-
(a) Must Her Majesty's Government be bound by all the existing conditions of such debts, or might they take over those debts on such terms as they thought proper?
(b) Were Her Majesty's Government bound to pay any instalments of principal or interest on such debts which fell due during the war, and previous to the dates of annexation, but which had not been paid by the Governinents of such States?
4. What answer should be returned to Messrs. Spicer and Sons?
5. Generally.
We have taken the matter into our consideration, and. in obedience to your commands, have the honour to
Report-
1 and 2. That we are of opinion that a Government annexing territory after conquest so annexes it subject, speaking generally, to such legal obligations as have been incurred by the previously existing Government before the outbreak of war, and not from their nature conditional on the continued existence of the territory as an independent State. We do not think that for this purpose any distinction can be drawn between the case of annexation after conquest but without treaty, and that of a treaty extorted by conquest, and providing for cession. We do not agree with the view expressed by Mr. Wessels that it would be open to Her Majesty's Govern- ment, acting upon any recognised principles of International Law, to repudiate responsibility for all the obligations incurred by the Governments of the South African Republic and the Orange Free State, so far as they can be fulfilled out of revenues to be derived from the property annexed.
We must, however, point out that the duty to observe such contracts cannot be enforced by a municipal court; it rests merely on the recognition of International Law of what is equitable upon the acquisition of the property of the conquered State.