File No. 718.1915/222.
The Minister of Panama to the Secretary of State.
Washington, October 20, 1914.
Your Excellency: I am instructed by my Government to notify your excellency’s Government that the Republic of Panama declines to accept or recognize as valid the decision of the Honorable the Chief Justice of the Supreme Court of the United States, dated September [Page 995] 12, 1914, as arbitrator under the convention of arbitration between the Republic of Panama and the Republic of Costa Rica of March 17, 1910,7 but rejects said decision and considers the same null and void because it is not authorized by the said convention and not within the powers conferred thereby upon the arbitrator.
The convention in question defines, by its first article, the question submitted to the arbitrator for decision and the limits of his jurisdiction in the following terms:
The Republic of Panama and the Republic of Costa Rica, although they consider that the boundary between their respective territories designated by the arbitral award of His Excellency the President of the French Republic the 11th of September, 1900, is clear and indisputable in the region of the Pacific from Punta Burica to a point beyond Cerro Pando on the Central Cordillera near the ninth degree of north latitude, have not been able to reach an agreement in respect to the interpretation which ought to be given to the arbitral award as to the rest of the boundary line; and for the purpose of settling their said disagreements agree to submit to the decision of the Honorable the Chief Justice of the United States, who will determine, in the capacity of arbitrator, the question: What is the boundary between Panama and Costa Rica under and most in accordance with the correct interpretation and true intention of the award of the President of the French Republic made the 11th of September, 1900?
In order to decide this the arbitrator will take into account all the facts, circumstances and considerations which may have a bearing upon the case, as well as the limitation of the Loubet award expressed in the letter of his excellency Monsieur Delcassé, Minister of Foreign Relations of France, to his excellency Señor Peralta, Minister of Costa Rica in Paris, of November 23, 1900, that this boundary line must be drawn within the confines of the territory in dispute as determined by the Convention of Paris between the Republic of Colombia and the Republic of Costa Rica of January 20, 1886.
Thus, by the terms of the convention, the line of the Loubet award was recognized as binding upon the parties. As to about one-half of that line (from Punta Burica to a point beyond Cerro Pando) it was expressly stated that no question whatever existed and that portion of the boundary is in no way involved in the present arbitration. It is and remains the boundary, not because the parties, by agreement, selected it, but simply and solely because President Loubet awarded it. Both parties, by this convention, affirmed anew their recognition of the entire correctness and validity of the Loubet award, which affirmation, indeed, Panama had made a condition of any arbitration.
With regard to that part of the line as to which a question was submitted to arbitration, the convention again recognized the entire validity of the Loubet award by the statement that the difference between the parties was—
in respect to the interpretation which ought to be given to the arbitral award as to the rest of the boundary line.
This again is an affirmance of the binding and conclusive character of the award. No question is made as to its validity, none as to its correctness, but only as to its interpretation. To submit to arbitration the interpretation of the award necessarily involves the affirmance of its validity and correctness. No award which could be impeached as either invalid or erroneous, could be submitted for arbitration as to its interpretation. Nor is it possible that, if any difference existed between the parties as to so vital a point as the validity of the award, the convention should make no mention of it and state, as the only difference, the interpretation [Page 996] which should be given it. Apart from the form of the question stated in the convention and definition of the difference which gave rise to it, the declarations already quoted are an explicit acceptance of the Loubet award in every respect.
The only question, therefore, submitted was, What was the true line awarded by President Loubet? And the only difference between the parties which caused a resort to arbitration at all was stated to be a difference as to the interpretation of a part of this award.
Nor was this definition hastily or carelessly made. The convention of arbitration was made under the good offices of the United States, then represented by your excellency’s distinguished predecessor, after prolonged discussion and debate between the representatives of Panama and Costa Rica concerning precisely the definition of the issues involved and the formulation of the question to be submitted to the arbitrator.
During the debate Costa Rica proposed that the validity and correctness of the award of President Loubet be submitted to the arbitrator and Panama constantly refused, and insisted on the absolute and unconditional acceptance of that award as valid and correct, as the condition of any arbitration whatever.
Under the influence of your excellency’s Government the contention of Panama prevailed and the convention was formulated as it is, with the express purpose of excluding, as it does, from the jurisdiction of the arbitrator any question of the validity or correctness of the Loubet award.
Indeed it would have been impossible for the Government of Panama to have submitted any such question to arbitration. By the Constitution of the Republic of Panama her boundary with Costa Rica is defined as being that awarded by President Loubet, and her Government would have been constitutionally unable to enter into any convention which would make possible the setting aside or modification of his award. This fact was officially stated to your excellency’s predecessor by the representatives of Panama at the time of framing the convention of March 17, 1910, and was recognized by them as limiting the scope of any possible arbitration of the boundary question. It was similarly made known to and recognized by the representatives of Costa Rica in that negotiation.
If the Government of Panama at that time had undertaken to enter into any convention by which the validity of the Loubet award could, by any possibility, have been put in question, it would have acted beyond its powers and the treaty would not have been binding upon the Republic. It did not do so. The convention of March 17, 1910, was framed with the fact before the eyes of all parties, that it could have no binding force if it made it possible to call in question the validity of the Loubet award, and was carefully expressed to exclude any such possibility.
Under these circumstances, it is with profound astonishment that my Government has seen the distinguished arbitrator, in what assumes to be a decision under this convention, omit to decide the only question submitted to him, viz: the “correct interpretation and true intention “of the Loubet award, and exceed his powers by undertaking to decide two questions not submitted to him, but, on the contrary, intentionally and carefully excluded from his jurisdiction, viz: [Page 997]
- 1st,
- the question of the validity of the Loubet award; and,
- 2nd,
- the question what the arbitrator would think to be the proper boundary between the two countries if the Loubet award were disregarded.
I need not point out to your excellency that a purported decision under a convention of arbitration which does not decide the question, and the only question, formulated in the convention as the subject of the arbitration, cannot possibly be a valid and binding-award under that convention.
Nor need 1 point out that where an arbitrator, asked only to interpret the description of a boundary in a previous award, renders a purported decision declaring the boundary which he was asked to define “non-existent,” such a decision is beyond his powers, is one which he is is not authorized to make, and one which has no legally binding effect.
Still less is it necessary to argue that where an arbitrator, whose only office is to apply the boundary awarded by a former arbitrator, wholly discards that boundary and undertakes to fix one of his own choice, avowedly and intentionally differing from the boundary which he was asked to apply, his decision is ultra petita, null and void.
It is true that the arbitrator says that:
It is conceded by both parties that under this treaty there is the power and duty to substitute for the line set aside a line within the scope of the authority granted under the previous treaty most in accordance with the correct interpretation and true “intention “of the former award.
and that in the depositive part of his decision he describes his new boundary as that “most in accordance with the correct interpretation and true intention “of the Loubet award; but in fact, as his decision shows, such does not even profess to be the character of this new boundary. So far from taking the Loubet award as a guide or attempting in any way to conform to it, the arbitrator first declares the line of that award to be “non-existent,” and then proceeds to fix a proposed boundary without reference to the former award at all.
In fact the arbitrator appears to have reached the conclusion that the “correct interpretation and true intention “of the award which he was appointed to construe was a line starting from Punta Mona, following the divide north of the valley of the Sixaola or Tarire to the Cordillera, and the latter to the point mentioned, near the [ninth] degree of north latitude. But having reached that conclusion, His Honor declares such a boundary to be void, not because to award it went beyond the terms of the convention of 1886 (which was the sole criterion of the powers of President Loubet), but because, from extraneous evidence, he believes that before the submission to President Loubet’s arbitration the dispute of the parties had not been such as to justify that boundary. That is, he thinks that before the conventions of 1880 and 1886 were made the controversy between the parties was only which of several rivers was the true boundary; and, therefore, that President Loubet could only award a boundary formed by a river, though none of the conventions under which he acted contains any reference to any such limitation on his jurisdiction.
[Page 998]His Honor has thus twice misconceived the fundamental rule of international law concerning the powers of arbitrators, viz: that they are determined, and determined only, by the convention of arbitration. He has held President Loubet to be limited by matters to which the conventions under which he acted do not, even by implication, refer; and he has held himself not to be bound by the most explicit provisions of the convention by which the submission to him was made.
His Honor is in error in supposing that Panama has ever conceded that he might set aside the Loubet award, or that he might fix a boundary at variance with that award, at his own pleasure or in accordance with his independent judgment. On the contrary, she has always maintained and still maintains that he has no authority to do either of these things and that in doing them he has greatly exceeded his lawful powers. Had there been any such concession, it could have conferred no power not to be found in the convention, and no such power as the arbitrator has undertaken to exercise can be found in that document. But there was no concession.
Furthermore, the line awarded by the arbitrator under the present convention must be, by the terms of that treaty, the boundary “under “as well as “most in accordance with the correct interpretation and true intention of” President Loubet’s award. The present arbitrator does not even assert that “under “that award any such boundary as he proposes would be possible. Plainly it would not be.
But it is superfluous to argue that a boundary which is totally divergent from and based upon considerations totally in conflict with the Loubet award and to reach which the line described by President Loubet is declared void and “non-existent,” cannot be the boundary either “under” or “most in accordance with the correct interpretation and true intention of “the boundary awarded by him. Except in the formal use of the words to which we have referred, it does not profess to be so.
The present arbitrator has conceived himself to be sitting on appeal from President Loubet, an appeal expressly forbidden by the convention of 1886.
He has not tried to apply or harmonize the award of President Loubet but has held it erroneous and has undertaken to annul it and to give such an award as he thinks should have been made in the first place. In so doing he has assumed powers never granted him and refused to perform the duty which the convention of March 17, 1910, required.
The purpose of this review is not to show the errors in His Honor’s award. A different examination would be required to that end. The present statement is intended only for the purpose of pointing out to your excellency’s Government the extra-limitation of his powers involved in the purported decision of the present arbitrator.
In view of this, my Government not only has the right but is bound to reject and repudiate, and does reject and repudiate the decision of the Honorable the Chief Justice dated September 14 [12], 1914, as null, void and of no effect; and declares that it considers the same as non-existent and in no respect affecting its claims, and that the Republic will not abide by nor accept the same.
[Page 999]My Government sincerely regrets that it is compelled to adopt this course, but high consideration of duty to the country and to the cause of international arbitration leave it no alternative.
Duty to the country, which has, as I have already noted, established the line of the Loubet award as the constitutional boundary, requires my Government to accept no other line. That constitutional provision would, indeed, make any acceptance of another line by the Government ineffectual and invalid; but even if my Government had power it would have no moral right to make such acceptance. Equally would a proper care for the interests of the country, apart from any constitutional provision, forbid such action.
In the interests of international arbitration my Government is also bound to reject this purported decision. The cause of international arbitration would suffer irreparable injury were it thus to be established that an arbitrator is not bound by the terms of the convention under which he acts and that, however carefully questions may be framed and issues limited, a nation which enters an arbitration is not protected, but must submit to decisions on questions which it refused to arbitrate and which the convention was framed to exclude.
Mindful of its international duties and obligations, my Government is making this announcement to your excellency’s Government, to that of the Republic of Costa Rica and to the arbitrator himself at the earliest moment possible, that there may be no doubt in the minds of any one concerned in the affair as to the attitude of Panama.
I repeat [etc.]