ing Swedish ships, and I know from personal knowledge that it was considered unfavorably. I cannot prove it, but I know it. The American authorities made no suggestion to the Johnson Line in regard to the movement of the ships until February 1918. The American authorities were not in a position to negotiate with the Johnson Line in regard to the use of the ships prior to February 1918. On January 29, 1918, the Government of the United States and the Government of Sweden became parties to a modus vivendi which provided for the employment of Swedish tonnage. The Swedish Government undertook in the modus vivendi to put no obstacle in the way of negotiations with private owners. While negotiations were under way with the Swedish Government in regard to the disposition of the Swedish ships the authorities of the United States were not in a position to negotiate with the Johnson Line. The letter to which reference was made from Mr. Munson to Mr. Ekstrom in which Mr. Munson informed Mr. Ekstrom that he could not discuss the matter with him then, but that Mr. Lundbohm could doubtless give him full information, is significant in that relation. Mr. Lundbohm was one of the Swedish delegates. He knew the status of the negotiations which were under way and he was in position to inform Mr. Ekstrom, but Mr. Munson could not illuminate him on the subject. There were no private negotiations so far as the Kronprins Gustaf Adolf and the Pacific were concerned, prior to the concluding of the modus vivendi. The authorities of the United States and the Swedish delegates were negotiating in regard to the two ships, perhaps not specifically. I do not know whether the negotiations related specifically to those ships or not, but they related to ships in the United States. These negotiations culminated in the modus vivendi. The authorities of the United States were not negotiating with the owner of the ships. The action of the representatives of the Swedish Government rendered it improper for the United States authorities to negotiate 144621-34- -20 with the Johnson Line, even if the authorities had desired to do so. The American authorities made no demands. The Johnson Line made no efforts to mitigate demands. There were no demands to mitigate. The statement under examination is inaccurate, in so far as it represents that the American authorities made demands and in so far as it represents that the Johnson Line endeavored to mitigate demands. This telegram I read and I will have the reporter copy it in the record. The ARBITRATOR: I have not that in the appendices? Mr. METZGER: You do not have it, but I can supply you with a copy, if you desire it. It was prepared for the confidential use of the Government, but there is no objection to your having it. It contains much material that is not in the record, but I think it might contain something that is not in the record that would still bear on the case, and I will take it on myself to furnish you a copy of it. I think it would be undesirable, however, to have it go in the public record of the case. It should be for your information only. The ARBITRATOR: The documents which are material and from which material has been quoted are quite numerous. I do not wish any more. Mr. METZGER: I refer now to page 4, Case of the Kingdom of Sweden. Reference is made at that page to the victualing and tonnage agreements by which the tonnage of Norway, Sweden, and Denmark was made available for use by the United States and governments associated with the United States in the war. It is mentioned also that Dutch ships were requisitioned. I point out that there was no likelihood that Swedish ships would be requisitioned. There were very substantial reasons why Swedish ships should not be requisitioned which did not obtain with respect to Dutch ships, and those reasons will be emphasized in discussing the treaty. It is not clear what application the Government of Sweden intended to make of these victualing and tonnage agreements to the claim in arbitra tion. Dutch ships were requisitioned under legislation authorizing the requisitioning of ships-not under legislation authorizing control of exports. It is not perceived that the agreements with countries other than Sweden or the requisitioning of Dutch ships have any bearing on this claim. In the modus vivendi and the later agreement of May 29, 1918, the Government of the United States undertook to license all exportation of supplies to Sweden and to license bunker fuel and ship stores for Swedish vessels. The Swedish Government undertook to place Swedish tonnage at the disposal of the United States and England. Neither the modus vivendi of January 29, 1918, nor the agreement of May 29, 1918, entailed violation of the treaty between the United States and Sweden. On the contrary, those agreements constituted an admission on the part of the Government of Sweden that the Government of the United States was in position to permit or to refuse the withdrawal of supplies from the country. The question was raised in discussing this modus vivendi as to the significance of the telegram (annex no. 5, p. 360, of the Answer of the United States, document no. II). That annex is headed, it will be observed, "Telegram to the War Trade Board from the London Representative of the Board". This telegram, like others, was sent by the representative of the Board to the Board through the American Embassy at London and the Department of State. The representative of the War Trade Board, I might state, was Mr. Sheldon. Mr. ACHESON: If I may say a word, Your Honor will recall that I asked the American Agent to clear up who "myself" referred to in that telegram. The ARBITRATOR: Yes. Mr. ACHESON: He says "myself" means Mr. Sheldon. The ARBITRATOR: I see. Mr. METZGER: I might explain that the War Trade Board had authority to grant or to refuse to grant licenses. They had authority and they exercised the authority to prescribe conditions on which they would grant licenses to take out cargoes, bunker fuel, and ship stores, and what was done in the modus vivendi was to enter into an agreement as to how they would exercise that licensing authority within the scope of that agreement. The War Trade Board had authority derived from the proclamations of the President to enter into an agreement of that kind. It did not need to go through the formality of a treaty or any other solemn agreement in a form which agreements between governments usually take. It is pertinent to state that the authorities of the United States made no effort to induce the Johnson ships to take employment prior to February 1918. It will be recalled that prior to July 26, 1917, Mr. Dean, representing the Johnson Line, offered the United States a large portion of the Johnson Line tonnage. On May 17, 1918, the Assistant Director of Operations of the United States Shipping Board Emergency Fleet Corporation, inquired of Mr. Munson whether anything could be done to put the Kronprins Gustaf Adolf in service. It will be found at page 480, American document no. II. The letter from Mr. Dean, to which I referred, in which he offered the Johnson Line tonnage, is found at page 240, Case of the United States. On May 9, 1918, Mr. Munson replied The ARBITRATOR: That is letter of July 17? The ARBITRATOR: Yes. Mr. METZGER: The other letter to which I referred was that of May 7, 1918, from the Assistant Director of Operations of the Emergency Fleet Corporation. That is at page 480, Answer of the United States. On May 9, 1918, Mr. Munson replied to the Assistant Director of Operations, stating that the Kronprins Gustaf Adolf had been detained under orders from the Swedish Government and added that he understood a charter had been arranged for the ship to carry a cargo of grain for the Belgian Relief and that it soon would be on the way. That is on page 481 of the American document no. II. In a telegram dated September 29, 1917, the American Minister at Stockholm reported to the Department of State that the president of the Johnson Line had called on him and asked whether the Government of the United States would be interested in a proposition whereby the Johnson Line would place about 40 or 50 thousand tons of shipping at the disposal of the Government of the United States in exchange for facilities and return cargoes for two Johnson Line vessels and for facilities for other Johnson Line steamers plying between Sweden and South America (p. 364, Answer of the United States, vol. II). The ARBITRATOR: We will recess until 2: 30 o'clock. (At 12 o'clock noon a recess was taken until 2: 30 o'clock p.m. of the same day.) AFTERNOON SESSION The proceedings were resumed, pursuant to adjournment, at 2:30 o'clock p.m. The ARBITRATOR: Proceed, sir, with your argument. Mr. ACHESON: May it please the Court, this morning the Arbitrator asked the Swedish Agent to furnish the answer of the Secretary of State to Mr. Ekstrom's letter of the 14th. I have it in my hand and will hand it to the Court and leave it with the Secretary of the Court and ask permission to read it so that it may be in the record. I have no copy of this letter. DEPARTMENT OF STATE, WASHINGTON. MESSRS. G. EKSTROM, 78-81 Wall Street, New York City. GENTLEMEN: The receipt is acknowledged of your letter of February 14, 1918, in regard to your desire to obtain a release of the vessels Kronprins Gustaf Adolf and the Pacific now in United States ports, and in reply have to inform you that your letter has been |