McEELLAR, United States Vice-Consul to Thomas O. Osborn, March 22, 1879

Mr. McKellar to Mr. Osborn.

Sir: I have the honor to acknowledge receipt of the communication of your excellency dated 15th instant, which reached me on 18th, inclosing copy of letter of Rear Admiral C. R. P. Rodgers, Commanding United States Squadron on Pacific station, to which letter my special attention is directed, referring to the transfer of three steamers hitherto sailing under the Chilian flag, and which have raised the flag of the United States, and have been furnished with prima facie evidence that the transfer of ownership to an American citizen has been made in good faith.

Your excellency furthermore states that if the surmises of Admiral Rodgers concerning the legitimacy of the transfer of these ships are correct, the action of the consulate, concerning their sale cannot be too soon revoked, but if on the contrary the sales were made in perfect good faith, as is contemplated in the consular regulations, that fact cannot be too soon fully developed.

Your excellency furthermore requests me to enter upon a thorough investigation concerning the legitimacy of such transfers at the earliest possible moment, and if it shall be developed to my satisfaction that such transfers were not made in good faith, I shall cause the authority by me executed, under which such vessels assume the character of American vessels, to be annulled, and finally that I will report to your excellency fully my action in the matter.

I take for granted that the three steamers referred to are the Itata, the Loa, and the Rimac, sold recently by Horatio Lyon, esq., Agent of the South American Steamship Company, to Henry L. Stevens, esq., of this city. Your excellency’s understanding that the action of this consulate in this matter was had under authority of sections 220 and 221, of the Consular Regulations of 1874, and that the steps required by those regulations were duly taken by this consulate in strict accordance with the letter as well as the spirit of Article XVII, is most correct.

The sale and transfer of the said steamers was made on or about the 27th February last past by Mr. Lyon, the company’s agent, in its name and by its authority, and his acts therein were approved by the board of directors of that corporation, who further authorized said agent to cause to be extended and to sign the corresponding instrument, which he accordingly did on March 11 last past, before Julius Cæsar Escala, esq., one of the notaries public of this city, in strict accordance with the laws of Chili in such case made and provided.

In the conscientious conviction of persons who, like myself, have been personally acquainted for years with all the gentlemen concerned in and parties to the transaction, their high personal and commercial character and standing would emphatically and totally preclude even the shadow of a shade of doubt, far less incite suspicion, as to the bona fides of any arrangement made by and between them. But when such arrangement, in addition to such a guaranty, is stamped with the sanction of a notarial instrument executed before and duly authorized or certified by a gentleman of such high standing in his profession as Mr. Escala, who is par excellence the notary always employed by the mercantile community of Valparaiso, no higher proof can be adduced.

In no part of the United States certainly, and, to my knowledge, probably in no other part of the world save France and Italy, is the maxim, “a cilibet in arte suâ credendum est,” so apposite as when speaking of notaries public in Spanish and Hispano-American countries (Chili, for instance) when acting within the scope of their legal attributes. His certificate,, authenticated by his signature and notarial “sign” or seal, is the strongest possible voucher and proof of the exactitude and authenticity of the assertions or statement of facts therein by him asserted. He is by law “un ministro de fé i. e., a minister of faith, and his signature and notarial sign or seal to all Ms acts are “confirmation strong as proofs from Holy Writ,” and as such are received both in judicature and without in the above-mentioned countries.

I have been thus extensive, even, I fear, to prolixity, in this exposition to demonstrate to your excellency that so far from having contented myself with a perfunctory discharge of my duties in this respect, I exacted and obtained the most convincing and irrefragable proofs of the good faith observed in the sale now animadverted upon.

Admiral Rodgers does not state the name of his informant who told him that the American citizen “who is the alleged purchaser” of the steamers in question “is not a man of fortune, nor has he hitherto been thought able to buy a costly line of steamships;” but if Mr. Stevens, the actual purchaser of those vessels, be the person alluded to by this innuendo, I can assure you that from my long residence in Valparaiso, and my experience among its capitalists, I am far from being of the same opinion as his informant. Mr. Stevens is a young, enterprising American, well and creditably known in commercial circles here, and could readily find “backers” of the strongest kind to enable him to effect the purchase. And he could the more readily do this as the objects of such purchase were three fine and popular steamers, and he had determined to place them under the aegis of the ensign of his native country, as he was entitled to do.

As it was, he proposed to pay the consideration money in my presence, and so it would instantly have been done had I seen any reason for executing the performance of what I considered an idle ceremony, as I, neither then nor at present, had the slightest doubt, certainly no suspicion, of the good faith of the parties, and especially as I was aware that the notary authorizing the transfer would take care to be satisfied a$ to the pecuniary part of the transaction.

I trust I have demonstrated to your excellency’s satisfaction that the proof of the bona fide nature of the purchase was satisfactory to myself, and so would have been to the most hypereritically captious of United States consular officers. I deemed the purchase to have been fair, and as the regulations specify no character of proof and define no method of its rendition, I felt not merely satisfied but authorized in relying upon the employment of a sound discretion and judgment in the matter.

I note that Admiral Rodgers cites and founds upon a clause in section 226 of Consular Regulations (ed. 1874), which declares that “the privilege of carrying the American flag is under the regulatio’h of Congress, and the statutes have not made that privilege practicably available to any ships except those duly enrolled at some customhouse “; but admits at the same time that he is “aware that our Attorneys-General have affirmed the right of a citizen of the United States to purchase a merchant ship of a helligerent anywhere, at home or abroad, and that the ship so purchased becomes so entitled to bear the American flag and to American protection; but that it was equally insisted upon that the purchase should be made bona fide, and the property passed absolutely and without reserve.”

It is evident from the tenor of the regulations, that the consul is the officer to be satisfied with the proof of the bona fide character of the purchase and of its fairness. I have already manifested to your excellency, to your satisfaction I trust, that I had the most conclusive and irrefutable proofs possible of these facts before becoming satis-lied, and I have had, as yet, no motive for changing myopinion.

Respecting the clause quoted by the admiral, as above set forth, I submit it to your excellency’s superior judgment, as to whether such a clause, which is seemingly rather a dictum of the compiler than any statutory enactment, can override or invalidate the previous declarations. In my opinion, certainly not. Paragraph 225 of same article even declares that “the right of American citizens to acquire property in foreign ships has been held to be a natural right, independent of statutory law, and is declaratory of such right therein, and of their right to protection in the enjoyment of the same.”

The acquirement by an American citizen to an undivided share in a foreign vessel certainly does not entitle him to display the American flag by virtue of such ownership, but his interest in such vessel, to use the cautious and rather vague language of the paragraph, “is no more and no less” entitled to recognition than the property of an American citizen.

The intent and meaning of the regulation is plainly shown by the first paragraph (section 634) of chapter XXXIII of the Consular Regulations of 1856, from which the regulation of 1874 is copied in ipsissima verba:

• Sec. 634. Inquiry is frequently made of the Department of State and of the Treasury as to what documents can be issued under the laws of the United States to foreign?-built vessels, purchased and wholly owned by citizens of the United States, whether purchased of belligerents or neutrals during a war, to which the United States are not a party; or in peace, of foreign owners, the purchase in either case being in entire good faith.
• Sec. 635. Vessels so purchased and owned are entitled to the protection of the authorities and flag of the United States, as the property of American citizens, although no register, enrollment, license, or other marine documents prescribed by the laws of the United States can be lawfully issued to such vessels.”

This is also affirmed by Attorney-General dishing, whose opinion will be found in page 6 of “Digest of Opinions and Leading Cases on International Law,” in the following words:

“A citizen of the United States may lawfully purchase a merchant ship of either of the belligerents, Turkey, Russia, Great Britain, France, or Sardinia, and if purchased bona fide, such ship becomes an American vessel in the sense of American property, although she is not an American vessel in the sense of the registry or enrollment acts; and she is entitled to protection and to the flag of the United States although she cannot take out a register. That is because she is foreign-built, not because she is belligerent built. The question as to what documents such a ship is entitled to, referred to, but not decided.”

The correctness of these views was entertained by the Hon. Thomas H. Nelson and General Judson Kilpatrick, United States ministers to Chili, and by Commodore John Rogers, commanding the United States squadron, then in the bay of Valparaiso, during the year 1866, at which time war existed between Spain and the Republic of Chili, and the ports of the latter were blockaded by a powerful and numerous Spanish squadron, was admitted and cordially acquiesced in by the Spanish Admiral, Don José Manuel Pareja, and his successor Don Castro Mendez Nunez, and their subordinates. In fact, no doubt existed, and no question was raised as to the fact, in the minds of any of these gentlemen, as to the legality of the acts of Mr. Silvey, then United States consul at this port, and his successor in office, Hon. A. W. Clark.

Commodore Rodgers did not content himself with a mere verbal approval, but on several occasions rendered prompt and efficient aid in similar cases. In the case of the Gravina, he intimated to Consul Clark his intention to have interfered, had the Spanish admiral refused to deliver her up.

This vessel then wearing Chilian colors had been sold in transitu to an American purchaser. Upon her approach to Valparaiso, displaying the Chilian flag, she was seized by the Spaniards, and condemned as a lawful prize by the prize court constituted and held on board the flag-ship of the capturing squadron. So soon as this came to the knowledge of Consul Clark, he proceeded on board the Spanish flag-ship, and exhibiting the documentary evidence of her new American nationality, demanded her release as the property a citizen of the United States. The Spanish admiral having examined the documents, admitted the justice of the demand, and ordered her release, courteously excusing himself, for evident reasons, from towing her into the anchorage by his own men. This was done by Commodore Rodgers.

Upon the evening previous to the bombardment, Commodore Rodgers put a crew of his own men on board, who took her out and anchored her close to the Spanish squadron. She was boarded by an officer from the flag-ship, who examined and indorsed her papers and retired. After the bombardment next day, the commodore, having ascertained that it would not be renewed, again sent a crew on board and brought her back to her anchorage in the port.

An instance occurs to my recollection of three Chilian vessels, whose names have at present escaped my memory, which were sold while at anchor in one of the southern ports, Talcahuano, if I mistake not, to an American purchaser. The evidence of purchase of these vessels was duly recorded in this consulate, and delivered to the purchaser, together with the proper certificates. He, taking them and three United States flags which he had caused to be made here for the purpose, started off for Talcahuano, where he arrived about noon of the day after the arrival there of the Vencedora, one of the Spanish squadron. Immediately upon reaching Talcahuano he repaired on board his vessels, furnished each with its corresponding documents, and ordered the American colors to be hoisted. This at once brought a boat off from the Vencedora, the officer in command of which examined the papers, indorsed them and took his leave, laughingly expressing his regret that he had not effected their capture previously.

Upon many occasions valuable assistance was rendered by the Spaniards to vessels recently flying the Chilian colors but which had been purchased by American citizens Nor was this a mere act of courtesy on their part. It arose out of their knowledge of the rights of the American owners, which they considered as properly authenticated by this class of documents. For they burned remorselessly every vessel they could lay hold of carrying Chilian colors; although wholly owned by Spanish subjects lately resident in Valparaiso, and who had taken refuge on the Spanish squadron.

Further proof as to the course of this consulate being considered legitimate, may be adduced from the fact of the United States consuls in Callao, and other ports of Peru, following the example of this consulate, and copying the formula used by it, with the approval of the then American minister to Peru.

I may likewise mention the significant fact that accounts of the receipts for the fees charged and received by this consulate for services in this behalf, and for the subsequent arrivals and deposit of papers, &c., of such vessels were approved by the Department of State without objection.

That the items and facts originating these fees were not unobserved by the Department is evident from the fact that this consulate was informed by it of the non-observance of the regulations exempting those who regularly traded between Port Constitution and Valparaiso from the payment of consular fees more than once in each and every three months.

I have thus endeavored to show your excellency that my course in relation to the three steamers above mentioned was not an adoption of the ancient rule of sic volo, sic jubeo, stat pro ratione voluntas, but was based upon reasons gathered from the practice long since adopted by my predecessors in the consular office, sanctioned by the approval of the gentlemen whom I have above mentioned, and admitted by the officers of the hostile squadron under the circumstance of a state of actual war, which admission on their part caused them heavy pecuniary losses in prize-money which they could have realized had they doubted of the legality of the consular proceedings.

Hoping the foregoing statements may meet your excellency’s approval,

I have the honor to be, sir, your obedient servant,