846 APPENDIX TO CASE OF GREAT BRITAIN. 
No. 122. 
The Marquis of Salisbury to Sir J. Pauncefote. 
[Telegraphic.] 
FOREIGN OFFICE, August 12, 1891. 
I have received your despatch of the 24th ultimo. 
The modification of the 7th Article of the Arbitration Agreement 
proposed by the President of the United States, and communicated in 
Mr. Wharton’s note to you of the 23rd ultimo, contains the following 
words: 
The Government of the United States having presented on its own behalf, as well 
as of the lessees of the privilege of taking seals on the Pribyloff Islands, claims for 
compensation by reason of the killing of seals in Behring’s Sea by persons acting 
under the protection of the British flag, the Arbitrators shall consider and decide 
upon such claims. . . 
These words involve the doctrine that Her Majesty’s Government are 
liable to make good losses resulting from the wrongful action of per- 
sons sailing outside their jurisdiction under the British flag. 
It would be impossible for Her Majesty’s Government to accept such 
a doctrine even at the hands of an Arbitrator. Nor can they 
17 admit that, by having asserted diplomatically the right of any 
persons to do that which an Arbitrator subsequently decides 
such persons cannot do, they are made liable in damages. 
This 7th Article, which deals with the question of compensation, is 
therefore likely to give occasion for lengthy negotiations, and the ques- 
tion arises whether it would not be better, if the Government of the 
United States will agree to such a course, to sign the other six Articles 
as to which an agreement has been arrived at, and to proceed with the 
arbitration, leaving the 7th Article to be treated separately? 
No. 123. 
The Marquis of Salisbury to Sir J. Pauncefote. 
[Lelegraphic.] 
FOREIGN OFFICE, August 22, 1891. 
IT am of opinion that it will be better for you to clearly recapitulate 
the grounds, as set forth in the telegram from this Office of the 12th 
instant, on which Her Majesty’s Government cannot agree to the word- 
ing of the 7th Article proposed by the President, and that, in lieu of 
it, you should propose one somewhat as follows: 
Either of the two Governments may submit to the Arbitrators any question of 
fact which it may wish to put before them in reference to the claims for compen- 
sation which it believes itself or its nationals to possess against the other. 
The question whether or not, and to what extent, those facts, as determined by 
the Arbitrators, and taken in connection with their decision upon the other ques- 
tions submitted to them, render such claims valid according to the principles of 
international law, shall be a matter of subsequent negotiation, and may, if the twe 
Powers agree, be referred in whole or in part to the Arbitrators. 
This is not to be taken as a definitive wording, and the proposal 
should be so made as to leave either side free to amend it. 
