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PUBLIC RECORD OFFICE

Reference :-

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PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

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MINUTES.

Erato."-After reference 16. One hundred and thirty bags cocoa beans ex s.8. to the Ministry of Food it was arranged that this cargo should be shipped from Malta to this country for disposal. The cargo has arrived at Portsmouth in the s.s. "Cove," and is to be handled by Messrs. C. M. and C. Woodhouse at a commis- sion of one-half per cent. The brokers declined to accept this business at the rate of commission for which they act for the Admiralty Marshal, viz., one-quarter per cent., and the higher commission was agreed to on account of the low value of the parcel, and in view also of the fact that a commission of one-half per cent. would be allowed to these or other brokers if the consignment, as was originally contemplated, had been disposed of through the Ministry of Food.

17. Insurance of cargoes in the Prize Court at Alexandria. (See paragraph 27 of the Sub-Committee's report dated 1st July last.)-The Insurance Companies have admitted the claim that an allowance is due to the Committee in respect of the whilst it remained in the vessel. The Lutzow premium on the cargo of the 8.8. allowance is to be calculated at the rate of 20s. per cent. per annum upon the value in excess of £250,000.

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18. Finances.-The monthly statements received from the Accountant show a balance of £1,942,558 10s. 1d. on the 31st July, and £1,949,192 158. 11d. on the 31st August.

CHARLES TENNYSON. T. H. HOLT.

31st December, 1918.

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II. APPENDICES.

APPENDIX A.-REPORTS.

(1) SEVENTH INTERIM REPORT OF THE OVERSEA PRIZE DISPOSAL COMMITTEE.

MAY IT PLEASE YOUR LORDSHIPS,

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to

THE Committee appointed by Treasury minute of 11th November, 1914, report in what classes of case it is expedient that prize ships captured or detained at ports outside the United Kingdom should be moved for sale or disposal to other ports, or should be chartered for purposes of trade, and to make the necessary arrangements in such cases as are remitted to them by the departments concerned in the administration of the territories where the prize ships are detained," and empowered by Treasury minute of 5th January, 1915, to take the necessary steps for chartering for use in British commerce such enemy ships detained in this country as may be required for the purpose," beg to submit the following report in respect of the steps which might usefully be taken at the present time with a view to simplifying the settlement at the end of the War in respect of the enemy vessels sentenced to detention under Article 2 of the Sixth Convention of the Second Peace Conference at the Hague in the event of it being decided that this article shall be put into force.

The Committee are aware that doubt has arisen as to the proper construc- tion of this article, and this matter, they assume, will be dealt with at the peace negotiations. For their present purpose they are proceeding upon the assumption that the enemy owners of vessels to which the article may be held to apply will ultimately be allowed either the return of their vessels or payment of compensation for their non-return; but that they will not necessarily be able to claim the return of such of their vessels as have been requisitioned and are still in existence, if His Majesty's Government prefer to pay compensation instead-i.e., that the requisitioning mentioned in the Convention may be permanent.

As regards the latter point, it is perhaps possible that it may be ultimately decided that the Convention does not give power to do more than requisition detained ships temporarily, and that any orders made for permanent requisition were ultra vires.

APPENDIX A.--REPORTS,

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In that event it would no doubt be necessary, despite such orders, to return to the enemy owners any such ships which might still be available; but the Committee do not regard this as the right construction of the Convention, and do not consider the risk a serious one. They would add, moreover, that the existence of a doubt on this point does not, in their opinion. affect the desirability of the course of action Buggested below. If the permanent nature of the requisitions were not in the end upheld, such action would not have conferred the advantages anticipated, but it would not have been in any way disadvantageous.

So far as the Prize Court Rules alone are concerned it seems clear that. although the word "permanent " is not used, the intention of Order XXIX., Rule 2, is to provide for permanent requisition in contradistinction to the temporary requisition provided for by Rule 6. The phrase "permanent requisition" is used accordingly in this report as equivalent to "requisition under Order XXIX.. Rule 2," but it is to be interpreted in the light of the above remarks.

So far as the Committee are aware, all the vessels seized in British (including oversea) ports which have been deemed capable of use have been requisitioned and brought into service. In the case of some of these vessels orders for permanent requisition have been made under Order XXIX., Rule 2; in the case of others temporary requisition has been ordered under Order XXIX., Rule 6, and the latter ships are, therefore, as matters at present stand, liable to be returned ultimately to the custody of the Prize Court. The Committee desire to draw Their Lordships' attention to these vessels, as they have formed the opinion that it would be an advantage to His Majesty's Government to secure, if possible, the conversion of the existing orders for temporary requisition (excepting those relating to vessels which have been lost) into orders for permanent requisition.

If such orders were obtained His Majesty's Government would be free at the end of the War (subject to any restrictions imposed by the Treaty of Peace) to retain the vessels which remained afloat, any liability to the enemy owners being, if necessary, discharged upon a money basis.

So far as can be foreseen at the present time it would appear probable that the return of a vessel to an enemy owner in a condition which would allow her to be put into immediate service is likely to be more advantageous to the owner than any scale of money compensation which His Majesty's Government would be likely to accept. Moreover, the vessel will, by reason of having been well maintained, be of far greater value to the enemy owner than if she had been laid up during the War. Furthermore, her value will have greatly increased by reason of the shortage of shipping, which it is anticipated will continue to prevail, at any rate for a short time, after the conclusion of peace, and in this connexion the Committee are strongly of opinion that every possible step ought to be taken to ensure that no enemy owner shall profit by any increased value of his ship which may have been brought about by the enemy measures at sea.

On the other hand, the permanent requisition of the vessels from the Prize Court need not, in the Committee's view, operate to prevent the return to the enemy owners of all or any of the vessels which are afloat at the time of settlement, should such a change occur in the shipping situation as would make it advantageous to His Majesty's Government to adopt this course rather than to liquidate their If the owner is content to take his ship liability upon a money basis in all cases.

in lieu of the money this could be done by arrangement between him and His Majesty's Government, and any necessary application made to the Prize Court by

consent.

In connexion with the proposal that application should be made to the Prize Court for orders for the permanent requisition of vessels claiming the benefit of Article 2 of the Convention which are at present employed on temporary requisition, the attention of the Committee has been called to an opinion. dated the 25th February last, by the Solicitor-General and Mr. Raeburn, dealing with the question of the right of the Crown to dispose of the 8.8. "Lucida" (a German vessel.sentenced to detention by the Prize Court in this country, which had been so damaged while under temporary requisition as to be constructively lost). In that opinion stress is laid upon the undesirability of taking any action at the present time which would involve a decision by the Prize Court upon the true construction of Article 2 of the above Convention. The Committee. however, do not think that the application to the Prize Court contemplated by them, which is, as pointed out above, in accordance with the Prize Court Rules, need necessarily raise any point of con- struction which is not already involved by the making of an order for temporary

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