tent proof. I further understand that this difficulty is increased in certain parts of the island by the loss of the Spanish records. Attention is also directed to the fact that the proposed order does not require that the commissioner shall be an expert in the matters over which he exercises authority or be conversant with the law of real property. Under these conditions it seems advisable to prescribe some rule of evidence for establishing a title, or at least prima facie title, in condemnation proceedings, and also to require the appointment of experts as commissioners.

Under the Spanish law the appraisal was conducted substantially as follows: The company appointed an expert who fixed the value, and the company tendered the amount to such person as it considered to be the proper party. If the owner was dissatisfied he appointed an expert who assessed the value, and the owner transmitted his report to the company and made demand for the amount so ascertained. If an agreement could not be reached by the owner and the company, the experts appointed by each were to meet and, if possible, agree. Failing in this, the governor of the province requested the judge of the district to appoint a third expert, who fixed an amount and reported thereon to the governor, who decided the amount to be paid, from which decision an appeal lies to the Crown. (Sec. III, Title II, Law of Jan. 10, 1879.)

The rule of evidence for establishing title in condemnation proceedings under Spanish law is as set forth in the following articles of the law of 1879:

ART. 5. The appropriation proceedings shall be conducted with the persons who, in accordance with the registry of property or the tax list, appear as the owners or as having their possessions recorded.

If on account of their age or for any other reason the owner of a piece of property should be incapacitated to enter into a contract and should have no curator or other person to represent him, or the property should be the subject of litigation, the proceedings shall be conducted by the promoter fiscal, who may validly perform in his name all that is stated in the foregoing article.

When the owner of an estate is unknown, or, if known, his whereabouts are unknown, the order or decree relating to expropriation of the estate shall be published in the Boletin oficial of the province and in a Gaceta de Madrid. Should no statement be forthcoming within a period of fifty days, either from the owner in person or through some one duly empowered, it shall be presumed that consent is given for the representative of the department of public prosecution to represent said owner in the appropriation proceedings.

ART. 6. All those who can not alienate the property which they administer without the permission of a judicial authority are authorized to do so in the cases mentioned in this law without prejudice to securing in accordance with law the amounts which they may receive in consequence of the alienation in favor of the minors or wards. In no case shall said amounts be delivered to them, but they shall always be deposited and held at the disposal of the proper judicial authority.

ART. 7. Transfers of ownership, under whatsoever title, shall not prevent the continuation of the expropriation, the new owner being considered as substituted in the obligations and rights of the former owner.

ART. 8. The rents and contributions pertaining to the property to be expropriated for works of public utility shall be admitted during the year following the date of the alienation as an evidence of the legal capacity of the person condemned to exercise the rights which may pertain to him.

The general features of these provisions of the Spanish law should be incorporated in the proposed order. If a satisfactory rule can not be provided, provision should be made for appealing disputed questions of title to the courts.

In addition, I suggest that said commission-

1. Be increased numerically.

2. Be required to take an oath and act thereunder.

3. Be required to personally inspect the premises to be affected by its action.

4. That the railroad company be required to furnish the commission a general plan of the line with longitudinal profile and cross-section drawings of the proposed construction of the road on the premises sought to be condemned.

These drawings are necessary to advise the commission as to the contemplated construction and enable it to determine the character and extent of damage to the property not taken.

Section X of the proposed order is as follows:

SEC. X. Maximum tariffs for the transportation of passengers, baggage, and freight shall be submitted in advance to the secretary of public works for his approval; and he may afterwards reduce such rates once in every period of five years. Against such decisions and reductions by the said secretary any railroad company may appeal at any time to the supreme court of Cuba which, sitting as a court of administration, shall decide the question summarily, after calling for such reports as it may deem necessary.

It is unnecessary to discuss herein the question of regulation of railroad rates by the government. It is sufficient to direct attention to the fact that upon the maximum rates being once established the authority of the government to reduce them can not be exercised for five years. The justification or necessity for reduction of railroad rates depends upon conditions which change continually and not at stated intervals. The commerce of Cuba is unsettled and undeveloped. Classification of freight at this time would be largely guesswork. If the government is to exercise this power, it should be free to exercise it as necessity requires and prudence dictates. If the government is to regulate the tariffs, it should also regulate the classifications, otherwise the authority to regulate is a "barren scepter.'

The provision of said section regarding appeal to the supreme court should be modified by inserting the words "and evidence" after the word "reports.

For your further information I transmit herewith a translation of the Spanish "law of January 10, 1879, relating to forcible alienation for a cause of public utility." This law had not been translated when

your request for this report was received, and the necessity of awaiting its translation has occasioned a slight delay in complying with your request.

The necessity for increased transportation facilities in Cuba, and the continued demand of the inhabitants therefor, induced the military government to attempt to provide for the construction of railroads in the island. A general order was drafted and submitted to the Secretary of War. The foregoing report was made on said order; the report was communicated to the military governor, and the proposed order modified so as to meet the objections and suggestions set forth in said report. (See Order No. 34, Headquarters Department of Cuba, dated February 2, 1902.)

IN THE MATTER OF AN INQUIRY FROM THE STATE DEPARTMENT REGARDING THE CLAIM OF MERRYWEATHER & SONS, LONDON, ENGLAND, FOR DAMAGES OCCASIONED BY THE REFUSAL OF THE CITY OF MANILA TO PERMIT THE FURTHER EXECUTION OF AN ALLEGED CONTRACT FOR SUPPLYING CERTAIN FIRE APPARATUS.

[Submitted December 6, 1900. Case No. 999, Division of Insular Affairs, War Department.]

SIR: I have the honor to acknowledge the receipt of your request for a report on the above-entitled matter, and in response thereto I have the further honor to report as follows:

The matter reaches the War Department by reference from the State Department of certain notes from the British ambassador at this capital calling attention to the claim for damages made by Messrs. Merryweather & Sons, of London, England, a British trading concern. The statement of facts made by Merryweather & Sons is controverted by the municipal authorities of Manila. Messrs. Merryweather & Sons assert that, prior to the late Spanish-American war, the municipality of Manila entered into a contract with them for the purchase and sale of certain fire apparatus for the use and benefit of the city. The present municipal authorities of Manila deny that such contract was ever entered into by the city and insist that the contract, if it ever existed, was between Messrs. Merry weather & Sons and Messrs. Aldecoa & Co., a mercantile concern doing business in Manila. (See doc. 17.)

The present municipal authorities of Manila assert that two members of the firm of Aldecoa & Co. were also members of the Manila city council, and that said firm contracted with Merryweather & Sons for

said fire apparatus, expecting to thereafter dispose of the same by a sale to the city. (See doc. 17.)

The present municipal authorities of Manila refuse to accept and pay for said apparatus, and assert that it is not needed by the city nor adapted to its use. (See doc. 19.)

The documents now before this Department do not set forth any proof of the existence of said contract nor make any showing in regard thereto further than the statements of complainants contained in their letters.

If it were conceded that said contract was entered into by the city, it does not follow that the city was not at liberty to refuse compliance therewith by submitting to the resulting liability for damages. In the opinion of the Attorney-General as to construction of sewers and pavements in Habana (Dady & Co.), delivered to the Secretary of War July 10, 1899, it is stated:

No one has a right to insist upon the specific performance of a contract for the improvement of streets in a municipality. A city may suspend or entirely abandon a project, although covered by a valid contract, subject only to the right of the contractor, if damaged, to recover just compensation. (22 Op. 529–530.)

The complainants recognize this right and therefore do not contend for an opportunity to complete a sale and to require payment of the purchase price. They demand damages for the abandonment. Complainants state that the purchase price was £3,886, and the damages are placed at £1,300. The measure of damages adopted by them is probably the difference between the contract price and the market value of the apparatus. No showing has been made to this Department as to whether or not this difference amounts to £1,300.

The attention of the Secretary is directed to the fact that, primarily if not exclusively, this controversy lies between the complainants and the city of Manila. The questions involved are of a kind and character which are ordinarily resolved by the courts. There does not seem to be any reason why this controversy should not be relegated to the courts and complainants required to pursue the ordinary remedies afforded thereby. Apparently there exist no reasons for the Secretary of War to exercise his authority in a controversy between an individual and a municipality in the Philippines over a disputed contract than would apply in the case of a similar dispute between individuals.

From the correspondence submitted by the State Department it appears that Messrs. Merryweather & Sons entertain the belief that the Federal Government of the United States is liable for the damages alleged to have been sustained by them. (See doc. 18.)

In arriving at this conclusion, the complainants have ignored the fact that the acts of which they complain were performed by the officials of the city of Manila. When that city became subject to military occupation the incumbents of political offices for the administration

of existing laws ceased to possess authority to continue such administration. Their several terms of office lapsed, and the authority to administer such powers as the municipality retained, passed to such persons as were designated for that purpose by the commander of the occupying military forces. It was the same as though a new corps of municipal officials had been elected and installed in office.

The powers exercised in refusing to recognize said alleged contract were powers possessed by the municipal corporation, and exercised by municipal officials for the benefit of the municipality. If a legal liability for damages resulted therefrom it attached to the city, and was not imposed upon the Federal Government of the United States. If this conclusion is erroneous and a liability did attach to the Federal Government of the United States a claim therefor is one of unliquidated damages. The War Department is not authorized to settle and adjust claims for unliquidated damages. Such claims must be submitted to Congress. If the complainants insist that the Federal Government of the United States is liable for said unliquidated damages they should induce their Government to present their claim to the State Department through diplomatic channels, and thus comply with the rule adopted by Congress that alien claims must be approved by the State Department before Congress will consider them.

Apparently the complainants are of opinion also that the military government of the Philippines, as distinguished from the municipality of Manila, is liable for the payment of the alleged damages. That is, the claim should be paid out of the insular treasury, instead of the municipal treasury.

Undoubtedly the Secretary of War, as the head of the military government in the Philippines, has such authority over the funds of said government that he may direct the application of said funds to the payment of this claim if his discretion prompts him so to do; but in order to secure such action it is necessary that he should be informed as to the facts involved. In the instance under consideration the vital facts are disputed, and the local authorities deny the existence of the contract on which the claim is based, and no evidence is submitted to establish the amount of damage under any rule of measurement.

If the Secretary is of opinion that probable cause exists for a belief that the military government of the Philippines is liable in this matter, it would seem advisable to refer the case to the military governor with instructions to appoint a commission to investigate the matter and report thereon, through the proper channels, to this Department. Ordinarily it would hardly seem advisable to admit as possible that the municipal authorities at Manila could impose a liability upon the treasury of the insular government. But this instance involves certain unusual proceedings not hereinbefore set out, which may induce the Secretary to believe that the military government of the islands is