Company affirms the sale of the Dacia to Edward N. Breitung, and an affidavit of December 19, 1915, of the said Breitung declaring this sale to be true and without reservations; the certificate of American registry of the said Dacia at Port Arthur, Texas, January 4, 1915; the manifest of the cargo and the bills of lading, dated Galveston, Texas, January 22, 1915; the log book of the Dacia;

Third, two agreements dated December 9, 1914 and January 17, 1915 regarding the chartering of the Dacia to transport its cargo;

Fourth, the documents concerning the cargo, among them the contracts of sale and for the transportation of the said cargo, drawn up at Bremen, December 10 and 12, 1914, together with the invoices under date of December 29, 1914, and the insurance policy against the risk of war dated January 22, 1915;

Having duly examined the brief and the supplementary and additional notes presented by M. Morillot, advocate of the Council of State, filed with the Council May 12, and July 13 and 28, 1915, in the name of Edward N. Breitung, alleged owner of the Dacia, and praying that it may please the Council: to order the immediate release of the Dacia on bail to be fixed by the Council, the amount of which shall not in any case exceed 870,000 fr.; to declare valid, under Article 56 of the Declaration of London, the transfer of the Dacia from the German to the American flag, carried out according to the provisions of American law; to declare void the capture of the Dacia, claimed to be neutral property; to release the ship and to restore the provisions and various supplies seized with the ship; to grant him, under Article 64 of the Declaration of London, the sum of 300,000 fr. damages for the injury caused him by the unjustifiable capture of his ship, to grant him a sum, to be decided upon hereafter, to cover the freight charges on the cargo and the demurrage incurred by the shippers of the said cargo;

Having duly examined the documents appended to the said brief among them an affidavit of W. Sickel, Manager of the Hamburg-America Company at New York, dated May 13, 1915, also a bill of sale dated December 16, 1914, in which he sells the said Dacia to Egon von Novelly, and a deed of transfer from Egon von Novelly to Breitung; the document of the United States Congress entitled Senate No. 563, 63rd Congress, 2nd Session, containing the opinion of the Hon. Cone Johnson, Solicitor for the Department of State, concerning the transfer of merchant ships in time of war;

Having duly examined the written demands of the Government

Commissioner, to the effect that it may please the Council to decide that the capture of the steamer Dacia, its rigging, apparatus, equipment, and supplies of every kind, effected February 27, 1915 by the French auxiliary cruiser Europe, be declared legal and valid, that the amount realized on the ship be assigned to the claimants, in accordance with the laws and regulations; and that their effects and personal belongings not constituting part of the cargo or private venture be restored to the captain and the crew;

Having duly examined the other documents appended to the file;

Having duly examined the notice published in the Journal Officiel of April 10, 1915, together with the interlocutory decisions rendered by the Council May 11 and June 8, 1915, and having granted, at the request of the United States Ambassador, additional time to Edward N. Breitung in which to produce his statements;

Having duly examined the decisions of Germinal 6, year VIII and Prairial 2, year XI;

Having duly examined the decrees of May 9, 1859 and of November 28, 1861;

Having duly examined the declarations of the Congress of Paris, of April 16, 1856;

Having duly examined the decree of November 6, 1914 declaring in force during the course of the present war the Declaration signed at London, February 26, 1909;

Having heard M. Henri Fromageot, member of the Council, in his report, and M. Chardenet, Government Commissioner, in his remarks. in support of the demands cited above;

The Council, after due deliberation,

Considering that on February 27, 1915, the French auxiliary cruiser Europe met the steamer Dacia on the high seas, at the entrance to the English Channel, and summoned her to show colors, which steamer was flying the American flag and was said to be proceeding from Norfolk, Virginia, U. S. A., to Rotterdam, Holland; that the examination of the ship's papers and the search conducted on board proved that the ship, carrying a cargo taken on at Galveston, Texas, consigned to Bremen, Germany, was at the outbreak of hostilities and until January 4, 1915, under the German flag, registered at Hamburg, Germany, in the name of the German Hamburg-America Company, and that the said ship was captured because it could not in time of war avail itself of the right of transfer to a neutral flag;

Considering that Edward Breitung, appealing to Article 56 of the Declaration of London of 1909, alleges that the transfer of the ship to the American flag was not effected in order to evade the consequences to which an enemy vessel, as such, is exposed; and claims, therefore, that the French state is not justified in disregarding the neutral flag carried by the Dacia;

That he seeks to prove this contention by maintaining that the said transfer was prompted by real and legitimate interests arising as follows: first, that, as he is not a German naturalized in America and is engaged in important business ventures, it is impossible to consider the use of his name as a subterfuge for the Hamburg-America Co.; second, that before the war he had thought of starting steamship lines; third, that he had entered into negotiations with a view to acquiring certain ships other than the Dacia and not flying the German flag; fourth, that subsequent to his alleged acquisition of the Dacia, he had continued to be interested in shipping ventures and had bought other ships; fifth, that he had declared under oath: "I bought the Dacia in the normal course of my shipping business. My sole object in making the purchase was to obtain at a reasonable price something of which I had need";

That Edward Breitung in support of his statements produces the following: a document not signed by him, dated December 17, 1914, the said document being among the ship's papers, in which the HamburgAmerica Line states that it has sold him all its rights, title and interests in the steamer Dacia, that it holds the said steamer at his disposal for his own exclusive use, guarantees all claims against or upon the steamer Dacia, for whatsoever cause or object, and undertakes to guarantee that the said ship is free of all encumbrance, of any nature or kind; a copy of the affidavit delivered to the United States Government previous to the admission of the vessel to registry under the American flag, and in which Breitung, as the purchaser named in the above-mentioned document declares that the transfer of the ship was made in good faith, that it is complete, without any reservation, or agreement of redemption; and in addition, an affidavit dated May 13, 1915, in which W. Sickel, Manager of the Hamburg-America Line in New York, declares under oath that, beyond the sale of the ship, there were no provisions nor agreements whatever with the Hamburg-America Line regarding the transfer or limiting the use of the ship, in short, that the sale was not made in order to escape the consequences of the state of

war;

In fact:

Considering that before the outbreak of hostilities, the Dacia of the Hamburg-America Line was, according to the claimant, habitually engaged in trade between German ports and ports of the Gulf of Mexico; that in fact it sailed last from Hamburg, June 17, 1914, for Newport News, Virginia, U. S. A.; that on July 28th it proceeded to Port Arthur, Texas, at the time of the declaration of war, and remained idle in that port instead of undertaking its return trip to Europe; that it is evident that the ship, like a great many others of the same line, suddenly discontinued its trade in order to avoid capture; that being in such a position and remaining unused, the Hamburg-America Line tried to sell it;

Considering that in an affidavit dated New York, U. S. A., April 15, 1915, a Mr. Egon von Novelly, declares under oath that on December 7, 1914, he signed and delivered to W. Sickel, New York manager of the Hamburg-America Line, an agreement worded as follows:

I make you a firm offer of $165,000 for the steamer Dacia, at present in the harbor of Port Arthur, Texas, including its equipment. This offer is subject to your obtaining the permission of the United States Government to place the ship under the American flag. I further state and declare under oath that the ship will be used to carry cotton or other non-contraband goods, to Germany, Austria, or to neutral countries.

That W. Sickel, in an affidavit dated New York, U. S. A., June 11, 1915, states under oath that he never received this letter;

That, however it may be as to these solemn contradictory oaths, it is proved by a document, dated December 9, 1914, included in the file, that on the said date of December 9th, that is to say, the second day after the disputed agreement cited above, Egon von Novelly entered into a charter-party with Messrs. L. A. Wight and Co. representing a Mr. Tom B. Owens, of Fort Worth, Texas, with a view to carrying a cargo of cotton on the Dacia from Galveston to Bremen, which was worded as follows:

E. von Novelly and Co. shall put in order the steamer Dacia, at present under the German flag and belonging to the Hamburg-America Line, for the transportation of 11,000 bales of cotton from Galveston, Texas, to Bremen, Germany. E. von Novelly and Co. shall have the steamer under the registry of the United States Government and under the American flag. E. von Novelly and Co. shall have the said steamer at Galveston, Texas, during the month of December, 1914, and shall guarantee its departure on or before January 15, 1915. The ship shall be in condition suitable for carrying the said cotton; the ship shall not be insured with the United States

Government against the risk of war, except for the amount in excess of $750,000, the sum fixed by the United States Government for the war risk on the cargo. The freight shall be payable upon the signing of the bills of lading at the rate of 3 cents a pound. E. von Novelly and Co. shall have the right to carry on their own account or for others an additional number of bales (not exceeding the total capacity of the ship) and the said additional number of bales shall not be prejudicial to the insurance on the 11,000 bales belonging to Mr. Tom B. Owens & Co. L. A. Wight & Co. shall do all in their power without prejudice to provide for the marine war insurance, on the bales in excess of the 11,000. Signed, E. von Novelly & Co. Wight & Co. representing Tom B. Owens & Co.;

That it is also proved that on the 10th and 12th of December 1914, following a succession of agreements entered into on these dates at Bremen by Tom B. Owens & Co. and a Mr. Harold von Linstow, of Bremen, claiming to act in behalf of divers interested Germans of the same place, 11,000 bales of cotton were sold by the said Tom B. Owens & Co. to the said Harold von Linstow on above account, with the stipulation that they should be transported directly or indirectly by the steamer Dacia, to be loaded by the date of sailing, January 15th, shipment to be made via Galveston, Texas, for Bremen; the said sale concluded, payment for the goods, the insurance, and the freight, is guaranteed by the following German banks,-the Deutsche Bank and the Diskonto-Gesellschaft;

That on December 16, 1914, according to a contract appended to the affidavit of the Manager of the Hamburg-America Line of May 13, 1915, cited above, the said German company, owner of the Dacia, stated to von Novelly that all the references presented by Breitung (3rd Memorandum, p. 5) showed him to be a "promoter of fictitious ventures," insolvent, and one with whom no ship-owner could seriously enter into a contract;

By these presents, we confirm our agreement to sell you for immediate delivery our steamer Dacia at present at Port Arthur, Texas, under the following terms and conditions: The purchase price of the ship shall be $165,000, plus the actual cost price of all the movable equipment on board, the coal, supplies, and furnishings, an inventory of all of which shall be made immediately. You shall pay to us today 10% of the sum specified above, that is $16,500, and agree to pay the balance of the purchase price within seven days of the date of this letter. Moreover it is understood and agreed that should you fail to obtain your request for American registration for the ship, we will return all sums that you may have paid us.

That the said contract bears the express consent of Egon von Novelly; that it was followed by a transfer of all his rights by the said Novelly to Edward N. Breitung: