Eastern Extension, Australasia & China Telegraph Co. v. United States

251 U.S. 355, 40 S. Ct. 168, 64 L. Ed. 305, 1920 U.S. LEXIS 1712
Supreme Court of the United States·Decided January 19, 1920·No. 357·Published·Cited by 20 cases

Opinion

Mr. Justice Clabke

delivered the opinion of the court.

The appellant, claimant, is the grantee from the Government of Spain of three concessions to lay down and operate submarine cables. The first one, in 1879, was for the exclusive privilege, for forty years, of constructing and operating a cable between the Island of Luzon and Hongkong. It was landed aUBolinao, on . the northerly coast of Luzon, and dispatches were transmitted to Manila and other places by government owned land lines, which were subject to interruption. This concession required that official messages be transmitted free and be given precedence. In 1898 a second concession, supplemental to the first, empowered the claimant to- extend its cable to Manila and the term of the prior exclusive grant was extended twenty years/ with the same priority for official dispatches, but with the provision that they were to be *357 transmitted free, only for the first ten years from the date of this second grant.

In 1897 á third concession,-the one with which this case is chiefly concerned, authorized the claimant to lay. down and operate three submarine cables, connecting the Island of Luzon with three Visayas Islands, — Panay, Negros and Cebu. This grant required the claimant: to operate the cables for twenty years; to give precedence to official dispatches and to charge for them at one-half" the rates charged for private messages; to pay a tax of ten per cent, on receipts in excess of expenses not to exceed £6,000 per annum, an additional tax of “fifty centimes of a franc” per word on telegrams transmitted, and a surtax of “five centimes.of a franc” per word on telegrams between the four islands named in the grant and others of the Archipelago.

The Government of Spain, on its part, agreed to pay the claimant, in equal monthly instalments, an annual subsidy of £4,500 during the term of the grant.

All of the cables were promptly laid down and put in . use and those of the third grant are designated in the record ( as the “Visayas cables,” and the grant as thé “Visayas concession.” This suit is to recover the amount of the subsidy provided for in the third concession, which had accrued when the petition was filed.

The United States denied all liability, and the judgment of the Court of Claims, dismissing the petition, is before us for review.

The case was here before on appeal and this court held (231 U. S. 326) that the case as then stated in the petition,, was not. within the jurisdiction of the Court of Claims, whether viewed as asserting an obligation growing directly out of the treaty with Spain or one imposed by principles - of international law upon the United States as a consequence of the cession of the Islands by the Treaty. ’The court, however, referring to' certain general and indefinite *358 allegations in the petition, suggested that the implication might be drawn from them that there may have been action on the part of officials of .the Government of the United States since it had assumed sovereignty over the Islands, which, if properly pleaded and proved, would give rise to an implied contract with the claimant outside the Treaty, which would be within the jurisdiction of the Court of Claims, and, to the end that the right to have such a claim adjudicated might be saved, if it really existed, the case was remanded for further proceedings in conformity with the opinion.

Doubtless inspired by the suggestion from the court, an amended petition was filed, in which claimant alleged with much detail; that the Government of the United States had used the cables extensively for official messages, which had been given precedence and had been transmitted, as required by the terms of the two concesssions, over the Hongkong cable free until 1908 and thereafter at one-fourth of the regular rate, and over the Visayas cables at one-half the rate charged for private dispatches; that the claimant had paid and the Government accepted the ten per cent, tax on receipts from messages, computed as required by the third concession; that since the American occupation the service over the Visayas cables had been extended and improved at large expense by arrangements with duly authorized officers of the Government; and that in August, 1905, the claimant had paid and the Government had accepted a balance due on an account stated in a form indicating an adoption of the terms of 'the concessions. By this course of conduct, it was averred, the United States “assumed and adopted” all of the obligations imposed on the Government of Spain by the concessions, and agreed with the claimant to discharge and perform all of them and especially agreed to pay the annual subsidy of £4,500, as required by Art. 10 of the third concession.

*359 Trial by the Court of Claims resulted in findings of fact, as follows: That the concessions were made to claimant as alleged and that all of the cables were completed and in use when the Treaty with Spain was signed, December 10, 1898; that the Government used the cables extensively for official dispatches which were given priority in transmission, but that this was in accordance with the International Telegraph Convention, as well as in compliance with the terms of the concessions; that the claimant charged the Government for messages over the Visayas cables at one-half the rate charged for private dispatches, which is the rate prescribed by the third concession, but that it “has paid the full rates charged by the claimant for messages over any of the lines” and claimant had authority to make its own rates; and that it is not true that the claimant transmitted messages over the Hongkong cable free of charge — “The United States Government has paid full established rates on the HongkongManila cable.”

It is further found that since December, 1901, the claimant has made claim to the subsidy in annual statements to the authorities of the Philippine Government, in which the terms of the concession granting it were referred to and in which the United States was charged with the amount of it then accrued. With respect to these, except as hereinafter noted, the court finds that whether any reply was made to them “does not appear from the record.”

Much significance is attached by the claimant to the statement presented on June 11,-1905. The finding with respect to this is that on that date the claimant’s representative forwarded to “The Secretary of Finance and Justice,” an officer of the Philippine Government at Manila, a communication, with an attached statement, purporting to show the amount ‘‘ due to the United States Government in the Philippines on account of the transmission *360 of all United States Government traffic over the ManilaHongkong cable, as per the concession granted us for the laying of the same, up to and including December 31,1904.”

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Eastern Extension, Australasia & China Telegraph Co. v. United States, 251 U.S. 355, 40 S. Ct. 168, 64 L. Ed. 305, 1920 U.S. LEXIS 1712 (1920).

251 U.S. 355 (Eastern Extension, Australasia & China Telegraph Co. v. United States) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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