5. The Nora, (page 65.—The claims are stated in gold.

6. The Sea Lark.-The claim of F. M. and Mary Jane Rawlins (page 82) is stated with an insurance deduction of "$1,565 gold." This shows that the whole claim is in gold. It also shows that the insurances were paid in gold. Under the head of the Florida some claims are expressly advanced in gold, e. g., under the Commonwealth, the claims of Hortsman, Page, Buchman, and Myer, (page 136.) Independently of the general considerations already presented, this offers the best reason for supposing that the other claimants also have made their claims in gold. See also Williams's claim, under the Jacob Bell, page 182.

(e) A payment, even in gold, a year hence, at the full rate of the claims, will not enable the individual claimants to restore to the United States the full measure of the national wealth destroyed by the Florida, the Alabama, and the Shenandoah after leaving Melbourne, because, as is well known, the purchasing power of gold has diminished about 50 per cent. within the last ten or twelve years. Therefore the same amount of coin now would not represent the same amount of values in ships and their equipments, and in cargoes, which it did in 1863. And as these proceedings have no relation to contracts, in which the representative of values is to be restored to the claimant rather than the values themselves, but relate to injuries which are to be compensated to the full measure of the damage-that is, to a measure which will restore the sufferer to the condition in which he was before the injury was inflicted-these considerations should be regarded by the arbitrators. And even should they come to the conclusion that some exceptional claims are stated in paper-currency, they will also see that the loss in the purchasing power of gold since the injury took place is greater than the difference between gold and paper at the time of the injury, so that a payment a year hence, even in gold at the rates claimed, will not, and in the nature of things cannot, be a restoration to the United States of the national wealth destroyed through the fault of Great Britain.

II.

The allegation that new claims have been introduced into the United States tables is not true in the sense in which the Agent of the United States understands the rights of his Government under the Treaty.

(a) It has already been shown to the Tribunal that the United States in their case made claim for all "their direct losses growing out of destruction of vessels and their cargoes by insurgent cruisers," (Am. Case, page 469,) under which they classified "claims for damages or injuries to persons growing out of the destruction of each class of vessels," (ibid.,) and that they asked the Tribunal, "from the data which were furnished to ascertain the names and the tonnage of the different vessels destroyed, and to form an estimate of the number of hardy but helpless seamen who were thus deprived of their means of subsistence, and to determine what aggregate sum it would be just to place in the hands of the United States on that account," (ibid., page 471.)

(b) The real question raised by the agent of Her Britannic Majesty is, therefore, not whether the United States have presented new figures which were not contained in their former statements, (although advanced in the gross in those statements as forming part of their losses,) but it is this, viz: whether the Tribunal, in the exercise of the power to award a sum in gross, conferred upon it by the seventh article of the Treaty, should limit itself by the rules and modes of proceedings prescribed for the assessors in the tenth article.

(c) The assessors are to be allowed by the Treaty two and one-half years to conclude their examinations, and they are required to examine each claim separately and to render their decision in each case on the proofs adduced.

(d) But the Tribunal is to make its decision on a gross sum, if possible, in three months from the submission of the argument, having first exhausted the most of the time in determining, separately as to each vessel, whether Great Britain is responsible for its acts; and there is nothing in the Treaty requiring them to make their decision on the examination of proofs furnished by the parties.

(e) The gross sum which the Tribunal may award is to be accepted by the United States as a satisfaction of "all the claims referred to it, (Art. VII,) not of all the claims presented by them.

(f) It is therefore manifest that the Treaty contemplated that the individual Arbitrators, in reaching such a gross sum as they might see fit to award, should have regard to all considerations of damage or injury to the United States within the scope of the arbitration, whether presented in detail or not, and that they should be at liberty to award such sum as justice might require, without a minute examination of detailed proofs. (g) Respecting the wages claimed in our tables, the Arbitrators will find in the volumes of the American Appendix statements of the numbers of the officers and crews of several of the vessels destroyed by the insurgent cruisers, and in the proofs statements of the wages of such persons. From these particular proofs they will be able to determine whether the estimates in our table of the amount of the claims presented originally in the American Case are, or are not, correct. Respecting the claims for effects, the same proofs show that, in cases in which such claims have been actually presented in detail, they equal or exceed the average claims in our tables. The Arbitrators have therefore the means of determining, with the reasonable accuracy contemplated by the Treaty, the amount of the injury suffered by the United States in each of these respects.

(h) The agent of the United States assumes that the Arbitrators will not regard the vessels destroyed by the cruisers as phantom ships, without officers or crews. On the contrary, he supposes that they will assume that they were officered and manned, and that from the general proofs in the case, and from their own knowledge, and from any other sources of information within their reach, they will determine whether the statements in our tables regarding these numbers are, or are not, probably correct.

(i) A gross sum, made up without regard to these classes of losses, would not be a due compensation to the United States for the injuries complained of before this Tribunal.

III.-PROSPECTIVE CATCH.

On this subject it is only necessary to repeat what has already been said on the part of the United States.

In the memorandum accompanying the tables presented by the agent of the United States on the 10th instant, it was said, (see page 168:) "In the American statement, particularly in the claims growing out of the destruction of whalers, prospective profits, or prospective catch, enter into the computation of damages." (See Note D, American Argument.)

"In accordance with the suggestions of some of the Arbitrators, we have eliminated from these tables the claims for prospective catch,

amounting to $4,009,302.50, but we do not intend to retire these claims nor to suggest that we do not think them just. On this subject we refer the Arbitrators to the note from the American Argument cited above."

And in the note accompanying the statement made by the American Agent on the 26th instant, it was stated that "the claims for whalers and fishermen's wages, for vessels destroyed or detained by the Alabama, by the Florida, or by the Shenandoah, (with the correction of the errors noted in the memorandum accompanying our tables,) estimated from the proofs presented, were $588,247.50;" and it was said that "this amount should be deducted from the total amount in the annexed summary, if the Tribunal allow the whalers' claims for prospective catch or interruption of the voyage." And it was further said in that memorandum thất if the Tribunal should be of the opinion that the prospective catch should not be allowed, then "we ask, as an equivalent, an allowance of 25 per cent. on the value of the vessel and the equipment," and in the said note we gave the amount so to be added at $400,127.91. It cannot therefore be said with truth that the United States abandon the claims for prospective catch or prospective profits, or that they present them as double claims.

IV. FREIGHTS.

In the memorandum above referred to it was said that, "according to the arbitrary assumption of the British statements, the freight claimed by the United States in the name of their mercantile marine is gross freight, and those statements reject all claims for freight; while on our side, in the absence of all evidence to the contrary, we assume that these reclamations are for net freight." And in the note above referred to it is said that "in all cases in which the Tribunal is satisfied that the freight claimed is net freight, the claim for wages should be allowed, bat in all cases in which the Tribunal is satisfied that the claim for freight is for gross freight the claim for wages should be disallowed."

It cannot be said, therefore, that we either make double claims in this respect or do not indicate to the Tribunal the questions for their investigation.

V.-DOUBLE CLAIMS.

The Agent of the United States has thought that it did not become him to assume the province of the Tribunal by deciding in advance what claims for insurance are and what are not double claims. He has, instead of such a course, indicated in the tables presented by him such claims as, in his opinion, are clear from doubt, such claims as may or may not be double, and such claims as on their face appear to be double, but which yet deserve the scrutiny of the Tribunal. These columns are thus referred to in the memorandum accompanying the tables: "Column three shows the claims for insurance, which are clearly not double claims. Column four shows the claims for insurance about which the evidence is silent. It is possible that some of these should be withdrawn from the aggregate of column two. This can only be determined by the examination of the particular facts in each case. Column five shows other claims for insurance in which the owners of the property destroyed claim at the same time full indemnity for their losses without regard to the insurance embraced in this column."

VI. GENERAL REMARKS ON THE CHARACTER OF THE CLAIMS.

It is said that the United States admit that these claims have never been audited. This is true only in the sense that they have never been subjected to official scrutiny such as they would receive at the hands of assessors. But it is not true that they have not been carefully examined, as is charged by the British Agent. On the contrary they were carefully scrutinized, document by document and proof by proof, under the superintendence of the Solicitor of the United States in these proceedings, and the abstract of the proof was in every case carefully verified with the original documents on file in the Department at Washington, and referred to in the Revised List of Claims.

In the American Case profert was made of the original proof, should it be desired; and, had the request been made by the British Agent, those proofs would have been here. It is also not admitted that the American claims are in any way exaggerated, or that, as now revised, the statements on our side contain any material errors.

GENEVA, August 28, 1872.

XVI.-NOTE ON SOME OBSERVATIONS PRESENTED BY MR. BANCROFT DAVIS ON THE 29TH AUGUST.

The Agent of the United States has forwarded to the Agent of Her Britannic Majesty, and has, it is supposed, delivered to the Tribunal, a paper containing some observations, to which it may be proper briefly to reply.

It will be convenient for the sake of brevity to refer to the various points to which these observations relate in the order in which they are mentioned by the Agent of the United States.

I. As to the United States Tables and the British Tables and allowances generally.

On comparing the British allowances, as stated in the United States Tables, with those contained in the British Tables, it will be found that the total allowances have been recently "increased." This arose from a desire to save the time of the Tribunal and to avoid disputes on minor matters, which led to all the claims for personal effects being allowed, except a few which were manifestly extravagant. In no case have the total allowances in respect of any one cruiser been diminished. The alterations, therefore, in the British Tables are not such as the United States have any reason to complain of. On the other hand, where the claims in the United States Tables differ from those in the Revised Statement, they have been invariably increased, and in some cases to no inconsiderable extent.

II. As to the Currency question.

It appears from the paper presented by the United States Agent being occupied by this more than by any other question, that it is felt to be a question of considerable importance, but it appears to the Agent of Her Britannic Majesty that the arguments urged in that paper strongly confirm the view which has been submitted on this matter in behalf of Great Britain. The reasons for this opinion are briefly as follows:

(a) The circumstance of the Treaty providing for the payment of the claims in gold would no doubt have raised a presumption that they are made in that currency, if they had been originally advanced subsequently to the Treaty. The fact, however, is that a list of the claims was prepared and was presented to the Congress of the United States as early as the year 1866, and that the claims now advanced are founded on this list of claims; that they are in very many cases identical with, that they never fall short of, but in a great many cases considerably exceed, the latter claims. Under these circumstances, as it is almost certain that the claims advanced in 1866 were estimated in the ordinary paper-currency, except in some few cases where gold-currency is expressly referred to, it seems to follow that the claims on which the Tribunal is called upon to adjudicate must also be considered as estimated in paper-currency.