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so the converse must be true that if the German Bank chose to insert a clause that German law was to apply such a clause would be acted on also. I very much doubt whether as between the parties both of whom were British, the British Court would apply German law in a caso arising out of a mortgage of land in a British Settle- ment merely because the original mortgagee had been German and had inserted a clause in the deed to the effect that it was to be governed by German law.
The present situation appears to me to be this: in actual practice the difficulties that the Germans say might arise under the existing system do not happen. The value of land in one of these German or British Concessions that are exclusively national is infinitesimal as compared with the value of land at Shanghae. No such difficulties as the Germans describe have happened at Shanghae, the present state of things must continue at Shanghae as it is not proposed that the new scheme should affect that port, and the difficulties in the national Settlements cannot be serious enough to require this change. The first argument, therefore, used by the Germans disappears.
On the other hand it does seem to be the intention of the Germans to allow no one to hold land in their Settlements unless they accept German jurisdiction; there are, consequently, three courses open :----
(a.) To refuse to allow the Consuls to consent to British subjects putting them- selves under German jurisdiction as suggested; the effect of this will be that British subjects will be excluded from the German Settlements.
(b) To allow British subjects to put themselves under German jurisdiction to the extent suggested, but not to require German purchasers of lots in British Settlements to accept British jurisdiction to the extent suggested.
extent.
(c.) To make the arrangement proposed for reciprocal jurisdiction to a limited
The Settlement of each will then be open to the nationals of the other. We cannot decide which to adopt until we hear more from Peking and know the views of the Consuls in the ports where these national settlements exists.
C. J. B. H.
Foreign Office, March 13, 1909.
Memorandum respecting the Judicial Position of Foreigners in the German Settlements at Tien-tsin and Hankow.
According to the provisions in regard to land purchase existing in the German Settlements at Tien-tsin and Hankow, a foreigner acquiring a piece of ground in the Settlement has to execute a declaration of submission on the inclosed model, which must be sanctioned by his Consul. The most important of the provisions contained in it is that under No. 2, according to which the owner of the ground is obliged to submit to German law and to German jurisdiction in all legal matters relating to his land and his position as regards the municipality of the settlement.
In so far as this Regulation provides for the application of German law, it corres- ponds to the regulations in force in the British Settlements at Tien-tsin and Hankow. See Tien-tsin Tocal Land Regulations and General Regulation, 1867, Article 4; Land Regulations of the British Municipal Extension, Tien-tsin, 1899, Article 4; Revised Land Regulations of the British Concession at Hankow in force from the 3rd July, 1902, Article 2. The German Declaration of submission, however, says further that foreign owners of land are amenable to German jurisdiction in the matters in question and deviates in this respect from the British requirements.
In the British Settlements provision is made for the co-operation of the British authorities in the case of the transfer or mortgaging of lands, so that foreigners are subjected to British voluntary jurisdiction. On the other hand, no provision is made for the exercise of contentious jurisdiction against foreigners. In the German Settle- ments contentious jurisdiction is also exercised as regards foreigners in legal matters affecting the land, because the German land register system introduced in the Settle- ments can only guarantee the necessary security of tranactions in land and of the credit of real property if the rights held in the land are in all cases judged and executed by the German Judge and according to the forms of German judicial procedure. It is impossible to expect from a foreign Consular Judge a correct application of German rules of law, which requires a detailed knowledge of the whole system. Gerinan jurisdiction, therefore, coupled with German law, represents
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an important factor particularly as regards loans upon a mortgage of land. the régime of the provisions in force and in confidence, that they will be maintained the mortgage business in the German Settlements has reached considerable proportions. A change in the law whereby the realization of mortgages would be rendered more difficult, would be contrary to good faith.
In matters concerning the position (of the owner of land), as regards the munici- pality of the Settlement, the subjection of foreigners to German jurisdiction is required in order to render possible a quick and effective application of the Regulations in force in the Settlement. The fact that for the attainment of this object the intervention of the supreme power cannot well he dispensed with is shown also by the Regulations issued for British Settlements. According to the latter the British Consul can, in the cxercise of his administrative powers, in the event of a foreigner contravening the provisions relating to land purchase or the Police Regulations, declare him to have forfeited his right to the land and seize it for the Crown. (See Tient-sin Local Land Regulations, Article 4.) As compared with this rule subjection to a regular jurisdiction seems far more lenient. Gerinan jurisdiction is, morcover, only to be exercised in the formalities of a civil action brought against a foreigner, and criminal proceedings against him are therefore excluded. Observance of the Police Regulations on the part of foreigners is assured by their having, in accordance with No. 1 of the land purchase provisions when acquiring the land, to bind themselves to observe the Settlenient Regulations on pain of a fine which, if the necessity arises, is collected by means of a civil action.
By the German jurisdiction over foreigners only the land plots in the Settlement are affected. For both in matters relating to the land and to the position of the foreigners as regards the municipality of the Settlement a judgment can only be executed upon
the plot of ground execution of a judgment does not take place upon the remaining part of the foreigner's property.
As, in connection with the subjection to jurisdiction, state sovereign rights come in question which are ordinarily withdrawn from private discretion, it seems desirable to cause such declaration of submission to be expressly sanctioned by the Consul and so by the state of the foreign acquirer. Up till a short time ago no difficulties occurred in this connection: on the contrary the representatives of Great Britain, Russia, Italy, and the United States have sanctioned without demur the declarations of submission executed by their nationals.
As, however, the British Consul at Hankow in a recent case refused to give a declaration of sanction we attach value to arriving at an agreement with the British Government whereby the latter should once for all express concurrence in the exercise of our jurisdiction over British subjects within the limits in question. We should in return be prepared to concede to British jurisdiction corresponding rights over Germans established in the British Settlements. It would also be expedient for the agreement to extend to lessors and lessees of plots of ground in the Settlements, for their submission to the law and jurisdiction of the Settlement state can he urged ou similar grounds.
The draft of an agreement meeting the requirements is annexed.
(Translation.)
Declaration for Owners of Land situated in the "Deutsche Niederlassung" at Tien-tsin [Hankow],
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As owner of a piece of ground entered in the Land Register (" Grundbuch ") of The Imperial German Consulate for Tien-tsin (Hankow), Vol. fol., No. Therewith agree to conform to the regulations as printed overleaf for the purchase of land in the German Concession at Tientsin (Hankow).
Tien-tsin [Hankow},
Regulations for the Purchase of Land.
The landowner is bound---
1. To become a member of the Municipal community of the German Concession at Tien-tsin (Hankow), in accordance with the statute of the community, to fulfil the
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