i
4
upbuilding of the proposed modern navy. To effect this special officers are to be sent without delay to the various provinces to investigate matters, and to find out how much money is actually devoted to these navies each year, and to see the condition of the junks that go to make up these navies.
Dear Sir,
Inclosure 4 in No. 1.
China Association (Hong Kong) to China Association (London).
Hong Kong, November 20, 1906. THE following telegraphic message was dispatched to you on the 16th instant :--
"With reference to British Government's refusal to support owners' claim for consequential losses Sainam piracy, urge Foreign Office not to commut themselves to this attitude with the Chinese Government pending further representations from here by mail."
The decision of His Majesty's Government not to recognize the claim in question was conveyed to the owners of the "Sainam" through His Britannic Majesty's Consul- General at Canton, in a letter from him dated the 6th November. No reasons were given for this decision. There was no hint that exception had been taken to the amount of the claim; no suggestion to indicate that a smaller one would have received greater consideration. The letter contained merely a brief intimation that the claim could not be supported. But from a rider stating that for any out-of-pocket expenses actually incurred a claim would be considered reasonable, the inference may be drawn that any other kind of claim is regarded as unreasonable. The owners have appealed to us for assistance in rebutting this view. Hitherto the infliction of fiues and penalties upon ineffectual rulers, as consequential damages done by disorders in which the subjects of civilized nations have suffered, has been regarded as a legitimate weapon to use in the fight for the establishment of law and order in the world--the fight between civilization and barbarism. If there are to be no more indemnities there will be many more disorders, and especially will this be the result in South China.
In this opinion the members of my Committee are unanimous, and at a meeting held to discuss the matter it was decided to represent the case to you again.
In the original instance your support was invited because it appeared to be a matter of importance that the provincial officials, who we presumed would in the last resort be called upon to meet the claim, might thus be made to realize an inconvenience to themselves in tolerating a continuance of the existing state of lawlessness under which outrages similar to that perpetrated upon the "Sainam" are liable to occur.
Our opinion was, and is, that only through the agency of pecuniary punishment can they be made to feel any unpleasant consequence of that parsimonious policy which is at the root of the evil. They will employ the needful men and provide the necessary funds only when the conviction has been brought home to them that, in the long run, this is a more economical method of dealing with piracy than the present more immediately lucrative method of pocketing the money required to put it down. This view of the matter, as we said, mainly influenced at first in taking up the owners' case and chiefly inspires us now to pursue it. Here we must protect ourselves against being misunderstood to mean that we were indifferent to the nature and extent of the claim. We apprehended that it might seem to some excessive. But we pointed out the necessity of hearing in mind the fact that for the best part of ten years the steamer Companies have been driven by the difficulties of the situation to carry on a losing fight for a footing in the slowly developing West River trade. The capital actually expended in pioneering this trade amounts to a million dollars or more. No return upon this sum has been received during the pioneering period, but the prospects were gradually improving; people were beginning to appreciate the advantages offered by the service, and profits were well within sight, when the enterprise was suddenly blasted by this curse of unrestrained piracy. In so far as there was formerly a belief in the efficacy of the protection afforded by the British flag, the British Companies are now worse off than ever-their chief advantage over native competitors having been largely swept away.
The theory of the claim is that prospects anterior to the "Sainam" outrage have been thrown back so badly that it will take three years to repair the loss, and the amount of that loss was estimated by taking the total capital sunk and working out the
5
interest at 8 per cent, for the first year, 6 per cent. for the second, and 3 per cent, for the third. These rates of interest may have seemed rather high to minds accustomed to the lower rates ruling in Europe, but it must be borne in mind that 8 per cent. is the rate ruling in this Colony, as evidenced by the fact that judgment debts carry it.
In our view, the amount of actual out-of-pocket expenses is no measure of the harm done to the owners, and we submit that the set-back to their trade is as much a proper subject of compensation as money expended in repairing material damages. On the whole, therefore, we incline to the opinion that, admitting the plea of consequential losses, a fairly good case could be made out for the amount of the claim put forward.
Our main concern, however, is not with the amount of the claini, nor with the description of the claim, nor with the disposal of the claim. Our main concern is to urge upon you the desirability of persuading the Foreign Office that a claim of some sort, over and above the amounts which they have so far admitted to be reasonable, is both reasonable and necessary. Let the amount be assessed at anything they please; let it be described either as consequential or as exemplary damages, or simply as an indemnity, and let the Foreign Office do with it as they will, in accordance with the suggestion now made by the owners in the letter inclosed. These are mere details, Our desire is to vindicate the principle of exacting exemplary damages for the non- fulfilment of Treaty obligations. By refusing to support some such claim in the present instance the Foreign Office would provide the Chinese with a precedent dangerous in the extreme, because seemingly based upon the assumption that the flag can be grossly violated without any loss to the Government directly responsible, other than that entailed by being called upon to pay a paltry bill for repairs, and some small compensation for lives lost or rained. The precedent would operate seriously to the detriment of the prospects of British trade in West River waters, and would no doubt be hailed with satisfaction by those unfriendly officials whose desire is to discourage it. As has already been pointed out, the theoretically greater security offered by the fancied protection of the flag is the principal advantage which has hitherto enabled British ship- owners to compete for a share in that trade. Unless this damaged theory can be power rehabilitated, unless the protective power of the symbol of British protection and is vindicated, the question will shortly arise as to whether the ship-owners will not be forced either to withdraw from the contest altogether or to seek the protection of some other foreign flag.
it
The well-known unwillingness on the part of the Foreign Office to support claims of a pecuniary nature made in China originates, no doubt, in a high-minded view of the duties of a great Power towards a relatively weaker State; and, in so far as it derives from this motive, no right-thinking person would wish it to change. Partly, however, may be interpreted as a concession to that popular but frequently mistaken emotion of benevolence which is apt to side with weakness irrespective of justice. It is unfortu- nately the case that there have been instances during the last few years in which it would appear that extortion has been practised upon the Government of China, but it does not seem right that a natural reaction in sentiment against these doings should be directed towards denying a sympathetic consideration of the legitimate grievance of subjects of the one Power which has invariably refrained from fathering injustice. As regards the mere vaguely emotional benevolence which appears to dictate the line of policy against which we are protesting, it only remains to be said that true friendship to China manifests itself not in condoning her failures, but in enforcing her responsibilities.
Yours faithfully, (Signed)
Sir,
Inclosure 5 in No. 1.
M. STEWART, Chairman.
Owners of "Sainam" to China Association (Hong Kong Branch).
Hong Kong, November 17, 1906. WE have the honour to request the assistance of the Committee of the China Association in the support of our claim against the Chinese Government for the piracy of our steamer "Sainam" on the West River on the 13th July last.
The particulars of the outrage are so well known that it is unnecessary to recapitu- late them.
[2810 y-1]
C
372
No comments yet.
Private notes are available after approval.