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Colonial Cases

Chinese Government v. China and Japan Trading Co., 1872

[arms trading]

Chinese Government v. China and Japan Trading Co.

Court of Confiscation, China
6 March 1872
Source: The North-China Herald, 7 March 1872

 

[I. M. CUSTOMS.]

COURT OF CONFISCATION.

Shanghai, March 6, 1872.

Before the TAOTAI, T. DICK, Esq., Commissioner of Customs, and G. F. Seward, Esq., U.S. Consul-General.

THE CHINESE GOVERNMENT v. THE CHINA & JAPAN TRADING Co.

   This was an enquiry into a case arising out of the Regulations regarding the importation or transshipment on munitions of war.  The main facts will be found in the statement put in as evidence for the defence.

   The TAOTAI said that action had been taken in the case because the munitions had been imported without permission.  Instructions had been received from the Tsung-li Yamen some time ago, in accordance with which a notice had been issued on the 31st July last, that arms &c., should not be landed without permission, and the taking them into port amounted to a breach of the Regulations.  The arms had however been released on a bond given till reference had been made to Peking, till it should be seen whether the action of the authorities here would be confirmed.

   In answer to Mr. SEWARD,'

   The Commissioner of Customs said that formed the case for the Government.

   Mr. SEWARD said it was admitted, on the side of the China and Japan Trading Company, that, on the 1st February last, there arrived to their consignment 84 cases containing munitions of war, and that seizure of this by the Customs Authorities was waived at the request of the consignees, made through him.  The merchandise in question was re-exported to Japan, 79 packages being transshipped to the Golden Age and 5 to the Oregonian, and a bond was given that the C. & J. Trading Co. would abide by the decision of the Tsung-li Yamen and the Minister in the matter, as to whether the value of the consignment should be forfeited.  If there were no witnesses for the Government, the case would rest on the Treaty.

   The TAOTAI repeated the circumstances preceding the granting of the bond, which he had accepted on the first instructions from Peking prohibiting the arrival and re-export of arms, and said that he had afterwards applied a second time for instructions but had not yet received a reply.

   Mr. SEWARD thought a record of the present hearing should be made on both sides, so that they should not send different cases to Peking for consideration.  A simple statement of the facts was all that was necessary - that the Treaty prohibited the importation and exportation of arms and that the defendants admitted having received intimation to that effect, but only a few days before the arrival of the arms.

   The TAOTAI assented, and the statement of Mr. Haskell, representing the C. & J. Trading Co., was then read by Mr. Seward for the defence.  It is as s follows:

   In August of last year we received from Japan instructions to order certain munitions of war, which our agent there had contracted to supply to the Japanese officials at one of the ports.  We telegraphed this order at once to London.  About the 24th of Nov. we received advices from London that the material was about to be shipped, and on the 20th Jan. were advised that it had been shipped in the steamer Hongkong. The steamer arrived on the 31st Jan.  I went to the Custom-house, in order to learn what proceeding was necessary to procure a transshipment I was informed that the Customs could not grant transshipment permits, and that a petition for such must be made to the Taotai, through trhe Consul.  I called upon the U.S. Consul-General, and was informed that immediate application would be made to the Taotai for the permit.

   In a few days the Consul informed me that the Taotai had intimated that he had no power to grant a permit, but would ask for instructions.  This information led me to believe that the reference by the Taotai to higher authorities would be favourable to our interests.  As we were each day expected the arrival of the material, I kept in communication with the Consul of the U. S. Government.  He from time to time informed us that he had not received the desired permit, but felt confident that it would be granted.  About a week before the material arrived, the Consul-General told us that he had sent to the Taotai, and that he did not anticipate any order for confiscation, but that at the worst the goods would have to be returned to Hongkong, and that he understood from the Taotai's manner the latter would be the case.

   From these statements it will be seen that we practised no concealment, that we acted in good faith, and that we were led to believe the goods might be transshipped, or at the worst returned to Hongkong.  I have to state, further, that to the best of my knowledge and belief, it has been usual for the Customs, until lately, to grant permits, for the transshipment of arms and munitions of war, to any applicant.

   From a question by the Taotai, it appeared that the form of application for permits for transshipment of munitions of war and the permits themselves had been the same as those for ordinary merchandise.

   The TAOTAI remarked that the practice in force before the notification of 31st July came into action  was not applicable to the period following, and that goods coming into the port for transshipment came into the port all the same as if they were imported to be landed.  This it was which constituted the breach of regulations and was prohibited. He referred to the different t instructions issued from time to time prohibiting the entrance of munitions of war into the port, and  said the strictness with which this class of goods had to be dealt with was shown by their being set apart from all other merchandise.

   Mr. SEWARD continued to read the statement -Proof had to be returned of the landing of the arms at the foreign port.  No sufficient notice of the discontinuance of the custom with regard to the transshipment of arms has ever been given.

   The TAOTAI remarked that this argument could not gold good, because the Regulations prohibited the introduction of arms into the port, and there could be no transshipment without the arms arriving here and the Regulations consequently being broken.

   Mr. SEWARD observed that he was only reading Mr. Haskell's statement, for which he did not hold himself liable.  The question of breach of regulations would be for the Tsung-li Yamen to decide.  He continued: - A notice was issued from the Custom-house on the 31st July, 1871, which reads:

Notice is hereby given that the practice of allowing munitions of war imported without permission to be landed under guarantee will be discontinued on the 31st of Oct. next, after which the Regulations relating to munitions of war contained in Rule 3 and Section 5 of Rule 5 of the Regulations appended to the Tariff will consequently be in full force."  - signed, &c.

This notice does not imply that the practise of granting permits for the purpose of transshipment will be discontinued.  It did not occur to bus that it would affect this shipment till after I had reported the matter to the Customs and to the Consulate.  At this time the merchandise, according to our advices, was already on the way.  The advices of the actual shipment and the bills of lading came to hand about ten days before the steamer having on board the goods arrived.  It was then too late to take the cargo out at Hongkong.

   The TAOTAI asked if a telegram could not have been sent to order the steamer to discharge the goods at Hongkong.

   Mr. SEWARD said it would have been necessary to send the bill of lading, which was the evidence of property.  This the defendants had only received, as was stated, ten days before the arrival of the steamer, and there was consequently no time to return it to Hongkong.

   The TAOTAI understood that goods might be purchased by telegram, and thought the landing of them might be effected in the same way, if it were explained that the bill of lading would follow the telegram.

   Mr. SEWARD said he was not competent to decide upon that point, but gave Mr. Haskell's statement of it.  That gentleman, being a merchant, ought to know what could or could not be done, and he said the course the Taotai suggested could not be followed.

   The TAOTAI quite understood that Mr. Seward was only reading Mr. Haskell's evidence, but felt called upon, when he thought there was anything incorrect, to comment on the points as they were read.

   Mr. SEWARD was very glad to hear the Taotai's remarks, in order that any point he did not understand might be made clear.

   Mr. HASKELL asked to be allowed to explain further the difficulty they had in stopping the goods at Hongkong.  The goods could not have been landed there by telegraphic order, because in the first place they had no agency there, and it would be necessary, in order to give a guarantee to the ship - which was sometimes done when there was no bill of lading - to send a power of attorney to some person to act for his firm.  This could not be done by telegraph.

   Mr. SEWARD continued reading the statement: In connection with landing at Hongkong there is another point; even had the bill of lading arrived sooner, trhe agents of the steamer might not have allowed the cases to be landed, they being heavy cargo, and probably in the bottom of the ship, requiring that other cargo should be removed before they could be got at.  I receikved no positive intimation that a claim for confiscation of the goods would be set up until the very day of arrival in port.

   Mr. HASKELL said he would like to add to his written evidence a few words putting more strongly the point that it has been the custom for the last few years here.  Since 1866 permission has always been given to transship for Japan; and when for arms being landed bonds were required, no bonds were asked for on account of those transshipped, which were simply treated as ordinary merchandise so far as transshipment was concerned.  Notification No. 103, of 31st July, also, particularly worded that arms or munitions of war would not be permitted to be landed, but there was no intimation about transshipment, which had already been allowed for so many years. His Excellency seemed to think that goods could not be transshipped without being landed, but there he was in error.  The goods in this case were not landed, but transshipped direct from the steamer arriving to the steamer leaving the port, the balance of 5 cases remaining after the Golden Age left being kept in the Hongkong till taken on board the Oregonian.  What he particularly wished to impress was that, while arms imparted could only be landed by special permission or under bond, arms transshipped had been treated as ordinary merchandise.  The long intervals elapsing between the 24th Nov., when first advices stated the goods were about to be shipped, and the second advice in January that they were so, was due to an interruption in the execution of the order, caused by strikes and the difficulty of finding a steamer, the P. & O. declining to take the cargo.   This closed the statement of the case.  Mr. Seward did not think that any infraction of the Regulations had been made out, and asked if the Taotai was prepared to cancel the confiscation warrant.  The Taotai replying that, he could not do anything as he had sent the case forward, Mr. Seward said he would then refer the matter to the U.S. Minister at Peking.

Published by Centre for Comparative Law, History and Governance at Macquarie Law School