#### THE EASTERN EXTENSION, AUSTRALASIA AND CHINA TELEGRAPH COMPANY v. THE UNITED STATES.

[No. 30767.

Decided December 2, 1912.]

*On the*defendants’ *Demurrer.*

At the time of the cession of the Philippines to the United States a British corporation has secured from the Spanish Government for a period of forty years grants and concessions for the establishment of submarine cables to be worked by the com- • pany at its own expense for an annual subsidy of £4,500. After the cession of the islands the United States use the cables in their public business and pay therefor. The company brings this suit to recover the subsidy assured to it by Spain, claiming that under the treaty of Paris or under the rules of international law the United States are liable therefor. The defendants move to dismiss under Revised Statutes (sec. 1066), prohibiting this court from entertaining jurisdiction of claims *“growing out of or dependent on any treaty stipulation entered into with foreign nations.”*The court overrules the motion (46 C. Cls. ft., 646). The defendants now demur on the ground that the facts averred are not sufficient to constitute a cause of action or to give the court jurisdiction.

I. By the treaty of Paris, 1898, the control and sovereignty of Spain over the Philippine Archipelago passed to the United States. All public property was ceded or relinquished; but it was expressly provided that the cession should not “ *impair the property or rights which by law belonged to the peaceful possession of civic bodies or of private individuals of whatsoever nationality such individuals may be.”*The cables owned by claimant under a Spanish concession are such private property.

*34II.The Revised Statutes (sec. 1066) prohibit this court from entertaining jurisdiction of claims “ *growing out of or dependent on any treaty stipulation entered into with foreign nations; ”*but the statute contemplates a direct and proximate connection between the claims and the treaty. The right must have its origin in and derive its life from the treaty.

III. The liability of Spain to the claimant for the annual subsidy agreed to be given for the construction and operation of its lines of cables was not extended to the United States by the treaty of Paris; nor does it attach to the United States as successors to the public property of Spain in the ceded islands.

IV. The obligation of Spain to the company for a subsidy does not operate to render the United States liable for a service. That liability will arise, if at all, under an implied contract.

V.Whether the provision of the Revised Statutes (sec. 1066) has been repealed is not now decided. If any liability attaches to the United States to carry out the contract of the Spanish Government it arises out of international law, and this court is without jurisdiction.

*The Reporter's*statement of the case:

The allegations- of the petition will be found sufficiently stated in the opinion of the court.

*Mr. W. F. Norris*(with whom was *Mr. Assistant Attorney General Jofm Q. Thompson)*for the demurrer:

The liability for debt arising from the personal obligation does not pass with the ceded territory, unless stipulated for in the treaty of cession. (Hall on International Law, 4th ed., p. 104, note; see also note, p. 99.)

The United States, through its commissioners, negotiating the treaty of Paris, specifically refused to assume the obligation constituting the subject matter of this action. The American commissioners refused to pay the claim in controversy, at the same time disclaiming any intention of ignoring the just claims arising from the principle of international law; but, after a consideration of the colonial obligations of Spain in Cuba and the Philippine Islands, they found them to be of such a character and amount that they refused to assume any of them, and in lieu thereof and to do justice in the premises and fulfill the duty imposed by international law, agreed to pay Spain $20,000,000 in lieu of any obliga*35tions incurred by her for the benefit of the Philippine Islands.

That the United States did not become liable for the payment of the subsidy in controversy is decided by this court in its opinion disposing of defendant’s motion to dismiss.

If the court has jurisdiction, it is because the claim in controversy is founded upon a contract with the .United States or upon a law of Congress. The claim is not founded upon a contract with the United States, but upon a contract between claimant and a foreign nation. The United States was not a party to the contract; was not primarily liable thereon; never by contract assumed liability or guaranteed the contract. If the defendant is responsible at all, that responsibility arose from the operation of international law. As stated by claimant, it devolved upon the "United States by virtue of international law, and the United States became responsible through assuming the sovereignty of the Philippine Islands for the colonial obligation of Spain, such obligation being an integral part of the political sovereignty of the ceded territory. The court has jurisdiction over claims based upon expressed or implied contracts with the United States and no others. Neither by express act nor other implication did the United States ever become liable to claimant for this obligation of the Spanish Government.1 That the claim over which this court has jurisdiction must be founded upon an express or implied contract with the United States, made directly with the United' States, and for the payment of which it is primarily liable, and not claims against other governments the payment of which the United States has assumed by treaty. (See *Great Western Insurance Oo.*v. *U. 8., 112*U. S. Rep., 199, cited p. II, defendant’s brief on motion to dismiss.)

This claim is not founded upon a law of Congress, but upon the law of nations. The liability of Spain is cast upon the United States by operation of international law. Claimant alleges that by reason of the occupancy of and the exercise of sovereignty over the Philippine Islands the United States became the successor of the Spanish Government and assumed its obligations.

*36In referring to the liability of the defendant, claimant alleges:

The liability of the United States rests entirely upon the principles of international law, as stated in the numerous cases cited by claimant in said argument, wherein he refers to and appeals to the principles of the law of nations to sustain his position.

*Mr. Louis Marshall*opposed:

It is our contention that, under general principles of jurisprudence, the United States, on admitted facts, remains liable for the annual subsidy stipulated in the concession, so long as it shall continue to avail itself of the general and special rights and privileges which it conferred. *(People*v. *Stephens, 71*N. Y., 549. See also *Rhode Island*v. *Massachusetts,*12 Pet., 787, 738.)

It has been decided by a multitude of .authorities that, where a lessee assigns his estate in demised premises, the assignee is liable to the lessor for the rent reserved in the lease, the assignee becoming liable by reason of privity of estate, even though there be no privity of contract. *(Stewart*v. *Long Island Railroad Co.,*102 N. Y., 607.)

Where an assignee utilizes the demised premises, privity of estate is established, and as a sequence the assignee, so long as he remains in possession, becomes liable, not for use and occupation or upon a *quantum meruit,*but upon the covenants of the lease. *(Walton*v. *Stafford,*14 App. Div., 312; *Cameron*v. *Nash,*41 App. Div., 532; in *Franlc*v. *N. Y., L. E. (& W R. R. Co.,*122 N. Y., 197.) To the same effect are *Pollard*v. *Shaffer,*1 Dallas, 210; *Probét*v. *Rochester Steam Laundry Co.,*171 N. Y., 584, 588; *Greenleaf*v. *Allen,*127 Mass., 248; *Fennel*v. *Guffey,*155 Pa. St., 38; *Wall*v. *Hinds,*2 Gray, 256; *Burnett*v. *Lynch,*5 B. & C., 589; *Astor*v. *Lent,*6 Bosw., 612.

Not only is this principle applicable in favor of a lessor, as against an assignee of a lease-hold interest, but it also applies in favor of a lessee, as against an assignee of the reversion. *(Schoelllcopf*v. *Coatsworth,*55 App. Div., 331; affd. 166 N. Y., 77.)

*37Applying these principles to the present case we find that the United States succeeded Spain in sovereignty over and ownership of the Philippine Islands. Its rights, though based on a conquest, were confirmed by a purchase in the form of a cession. The United States thereby became substituted to the Spanish sovereignty, and suceeded to all of its rights under the concession from the Spanish Government to the claimant.

As between individuals, such a state of facts would result in the implication of a contract, by recipient of these benefits, to be bound by the terms of the agreement, whence such advantages are derived. The acceptance of benefits so secured involves the obligation of assuming the correlative burdens imposed by the same contract.

The Government, no more than an individual, will be permitted to blow hot and cold; to adopt and renounce at one and the same time; to affirm that part of an arrangement which is advantageous and to disaffirm that portion which is onerous. When it sees fit to accept benefits it must be deemed to have elected to take them *cum onere.*

It has been held that even where a State has been induced to enter into a contract by fraud, if it nevertheless, with knowledge of the fraud, continues to take the benefits of the contract, it is not thereafter permitted to repudiate it, but is bound to perform its provisions, thus placing it in this regard on a parity with private individuals. *(People*v. Stephens, 71 N. Y., 527; *Masson*v. Bovet, 1 Denio, 69; *Yernol*v. *Yernol,*63 N. Y., 45; *Mills*v. Hoffman, 92 N. Y., 181,190; *Baird*v. Mayor, *So. of N. Y.,*96 N. Y., 589; *Oobb*v. Hatfield, 46 N. Y., 536.)

This principle applies *a fortiori*where there is no pretense of fraud; where no attack is made on the bona fides of the contract; where there is no pretense that it was the result of collusion, undue influence, or of the making of an unfair' advantage, and where the beneficial nature of it is conceded. In such a case it would seem as though when one, whether an individual or a government, undertakes to enjoy the benefit of such a contract it is tantamount to an adoption of its provisions, and that even in the absence of an express *38contract an obligation *ex aequo et bono*to undertake the performance of the burdens, which are reciprocal to the advantages derived, will be implied. This doctrine has been frequently applied by the Supreme Court of the United States. *(United States*v. Bussell, 13 Wall., 623; *Hollister*v. *Benedict <Ss Burnham, Mfg. Co.,*113 U. S., 59; *United States*v. Palmer, 128 U. S., 262; *Coleman*v. *United*States, 152 *U. S.,*99.)

■ It proceeds on the same equitable considerations as the civil law doctrine of enrichment, which has been accepted as applicable to cases like the present. (“The Doctrine of Succession of a State by a State,” Pisa, 1910, p. 135.)

Thus far we have dealt with the facts of this case without elaborating the special doctrines of international law, which follow the annexation by one government of the territory of another as a result of conquest or cession — a doctrine known by the modem authorities under the term State succession.

The most philosophical work on the subject is that of Max Huber, entitled “ Die Staatensuccession,” which has been cited approvingly by Westlake in his International Law..

Founded on this theory, the author shows that the succeeding State is bound by all obligation of the ceding State which pertain to the territory to which the contract out of which the obligation arises.

This is also recognized by Martens in Iris Treatise on International law (pp. 368-369).

David Dudley Field, in his Outline of an International Code, in which he undertook to codify the law of nations as laid down in the best authorities, lays down the rule thus:

§23. “Where part of the territory of one nation is annexed by cession or otherwise to the territory of another, the latter nation by the act of annexation acquires all the rights and becomes bound to fulfill all the obligations which pertained to the former nation in respect of the territory acquired and its inhabitants and the property therein, but no others.”

The Italian courts have had frequent occasion to apply these principles since 1859 with respect to territory formerly *39belonging to Austria and other Governments, which it annexed during the process of unification. The rule laid down by them is as follows:

The Italian doctrine was adopted and applied by the Conseil d’Etat of France, by a decree of April 28, 1876.

Fiore’s New Treaty of International Law:

The counsel for the United States has cited a passage from Hall on International Law in support of his contention to the contrary. But an examination of section 29 of Hall on International Law, 4th edition, will indicate that he recognized the doctrine for which we contend, as applicable to contracts relating solely to the ceded territory; whereas the passages quoted on behalf of the United States relate to the general debt of a State, and not one relating solely to the ceded territory.

The counsel for the United States has also quoted from an opinion of Mr. Magoon, while acting as the advisor of the War Department, with regard to the claim now under consideration, in which he directs attention to the report of the Transvaal Concessions Commission, dated April 19,1901, appointed by the English Government “ to inquire into the concessions granted by the government of the late African Republic.”

It is to be noted that, in paragraph 9 of this report, the doctrines announced by Chief Justice Marshall in *Soulard*v. *United States*(4 Pet., 511) and *United States*v. *Perelieman*(7 Pet., 51) have been expressly recognized.

• The opinion of Mr. Magoon has recently received severe criticism in Benton’s International Law and Diplomacy of the Spanish-American War, pp. 270-275, Chapter IX, entitled “ Fulfillment of Treaty of Peace,” a work published in 1908.

It will be observed that the opinion of Mr. Magoon quotes from a report of Gen. Greeley, the Chief Signal Officer of the United States Army, in which that very distinguished officer recognizes the existence of an obligation on the part of the United States, to pay the subsidy which we are now seeking to recover.

*40Bentwich, on the Law of Private Property in War (pp. *70-72):*

Par from precluding the claimant from enforcing the obligation of the United States under the doctrines of international law, which flows from the facts disclosed by this record, the American commissioners expressly recognized the existence of such obligation, as could be established against the United States “ as successor in sovereignty in the ceded territory.” (Paquete Habana, *176*U. S., 677) :

We claim in the present case that, under the doctrines of international law, as well as upon common law and equitable principles, all of which are applicable here, under the terms of the Tucker Act, the claimant has made out a cause of action, especially since, by demurring to the petition, the defendant has admitted the allegations, which make the principles which we have invoked applicable. (Schoellkopf *v.*Coatsworth, 166 N. Y., 77.)

It is argued that the claim is not founded upon a contract, express or implied, with the United States. We have shown that it is.

We have also shown that the case comes within the language of subdivision first of section 1 of the Tucker Act, Avhich gives jurisdiction to this court, not only of claims founded upon the Constitution of the United States, a law of Congress, a regulation of an Executive Department, or upon a contract, express or implied, with the Government of the United States, but also over all claims “ for damages, liquidated or unliquidated, in cases not sounding in tort and in respect of which claims the party would be entitled to redress against the United States either in a court of law, equity or admiralty, if the United States were suable.”

The present claim does not come within any of the exceptions, but is covered by the general grant of jurisdiction.

It is claimed that the jurisdiction of this court is expressly precluded by section 1066 of the United States Bevised Statutes.

Even if section 1066 continued in force, our claim was not one growing out of or dependent on any stipulation in the *41treaty of Paris; in other words, that our *right*was not created by and was not dependent upon the treaty.

It is urged by the eomisel for the United States that, because the petition refers to the treaty of Paris, our cause of action grows out of and depends upon that treaty. That is not an accurate statement. We have merely referred to the treaty as a historical fact, of which the court would have taken judicial notice, even though it had not been pleaded; to indicate that our Government had succeeded Spain in sovereignty over the Philippine Islands, just as we might have referred to the cession of Florida by Spain, of California by Mexico, of Louisiana by France, in an action involving the title to lands in those respective States.

The treaty of Paris merely sanctioned and confirmed the conquest by the United States of the Philippine Islands. If there had been no treaty whatsoever, our contention in the present case would be precisely the same as it now is. Our rights do not depend upon any grant or covenant contained in the treaty, but arise out of considerations of international and municipal law which have no derivation whatsoever from the treaty.

If the treaty had contained an express assumption by the United States of the contract between Spain and the claimant, it could then have been argued, with much force, that the cause of action was dependent upon the treaty, because it would then have been sought to enforce an obligation created by the treaty.

Inasmuch, however, as the American commissioners expressly declined to create any such obligation by treaty and relegated the claimant to seek redress under the general doctrines of international law, it is clear that the treaty does not enter into the creation of the claimant’s cause of action, which has its genesis outside of any beyond the terms of that instrument.

As was said by Judge Folger in *Hunt*v. *Hunt*(72 N. Y., 217) :

“ Jurisdiction of the subject matter of an action is a power to .adjudge concerning the general question involved therein, and is not dependent upon a state of facts which may appear *42in a particular case or tbe ultimate existence of a good cause of action in the plaintiff therein.”

“Jurisdiction is the right to put the wheels of justice in motion and to proceed to the final determination of a cause upon the pleadings and evidence.” (Mr. Justice Brown in *Illinois Central R. R. Co.*v. Adams, 180 U. S., 34.)

See also *Rhode Island*v. Massachusetts, 12 Pet., 667, 718; *Byers*v. McAuley, 149 U. S., 608, 628; *United States*v. Arrendondo, 6 Pet., 691, 709; *Grignon*v. *Astor,*2. How., 319, 333; *The*Resolute, 168 U. S., 437, 439.

Peelle, Ch. J.,

delivered the opinion of the court:

The defendants’ motion to dismiss the petition in this case was heretofore overruled (46 C. Cls., 646) on the ground that while the United States were not liable under their treaty with Spain for the annual subsidy agreed to be paid by the Government of Spain for the construction of the cables, as set forth in the petition, they were liable on an implied contract to make reasonable compensation for the use of the cables.

Since this ruling the Government has interposed a demurrer to the petition on the ground: “ First. It does not set forth facts sufficient to constitute a cause of action against the United States. Second. It does not disclose a cause of action within the jurisdiction of this court.”

The contentions of the parties on the demurrer are substantially, if not identically, the same as when the question was up on the motion to dismiss, and therefore we will briefly review what was said in the opinion on the motion to dismiss.

The petition avers substantially that prior to the War with Spain the claimant herein, a British corporation, had by separate grants and concessions entered into contracts with the Spanish Government for the construction and operation at its own expense of certain submarine cables and telegraph land lines communicating between the Island of Luzon and certain other islands in the Philippine Archipelago and Hongkong, China, for which the Spanish Government agreed to pay the claimant an annual subsidy of £4,500, payable monthly at Manila by the chief treasury office of those islands.

*43That prior to December, 1898, the Philippine Archipelago, including the islands referred to, was under the control and sovereignty of the Government of Spain, but by Article III of the treaty of Paris of that date (30 Staf. L., 1154), ceding the Philippine Archipelago to the United States, the control and sovereignty of Spain passed to the control and sovereignty of the United States, who thereupon took possession of said islands and, as averred, assumed “jurisdiction and control over all property and property rights in and upon said Philippine Islands, including the several lines of submarine cable and telegraph land lines established, constructed, and operated by the claimant, and availed itself of all the benefits and advantages thereof, using said lines of cable and telegraph for its governmental and other purposes, which it has continued to do ever since and still continues to do ” without the payment of said annual subsidy of £4,500 so theretofore agreed to be paid by the Spanish Government.

By Article VIII of the treaty all buildings, wharves, public highways, forts, and all public property which by law belong to the public domain, and as such to the Crown of Spain, were ceded or relinquished to the United States, for which it is understood $20,000,000 were paid; and it was therein provided that the relinquishment or cession “ can not in any respect impair the property or rights which by law belong to the peaceful possession of property of all kinds, of Provinces, municipalities, public or private, establishments, ecclesiastical or civic bodies, or any other associations having legal capacity to acquire and possess property in the aforesaid territories renounced or ceded, or of private individuals, of whatsoever nationality such individuals may be.”

Upon investigation it will be found that the foregoing is the usual stipulation in treaties and is in effect a declaration of the rights of the inhabitants under international law. *[United States*v. *de la*Arredondo, 6 Pet., 691, 712.)

When this case was considered on the motion to dismiss the claimant’s contention was (1) that section 1068 of the Devised Statutes — excluding from the court’s jurisdiction claims growing out of or dependent on treaty stipulations with foreign nations — was superseded and repealed by section 1 of *44the act of March 3, 1887 (24 Stat. L., 505) ; (2) that the claim herein was not one “ growing out of or dependent on any treaty stipulation entered into with ” the Government of Spain; and (3) that by the law of nations the United States became obligated to perform the contract of its predecessor in said islands.

In the absence of any provision in a treaty to the contrary the municipal laws of the territory in force at the time of the cession continue until changed by the new Government. *(Chicago, etc., R. R. Co.*v. *McGlinn,*114 U. S., 542.) This, too, notwithstanding the territory so ceded is held subject to the constitution and laws of the new Government. *(Pollard*v. *Hagan,*3 How., 212; *Benson*v. *United States,*146 U. S., 325, 330; *Strother*v. *Lucas,*12 Pet., 410; *United States*v. *Power,*11 How., 570). Upon the acquisition of territory the private relations and rights of property are not disturbed by a change of allegiance. *(United States*v. *Percheman,*7 Pet., 51, cited in numerous cases, including that of *Downes*v. *Bidwell,*182 U. S., 244, 367. See also *Interstate Land Co.*v. *Maxwell Land Grant Co.,*139 U. S., 569.) In other words, the cession of territory does not carry with it the jiroperty of the inhabitants thereof. *(Strother*v. *Lucas, supra.)*On the other hand, upon such cession it has been held that the new Government succeeds to the position of the former Government respecting the property rights of the inhabitants in lands whether executed or executory. *(Soulard*v. *United States,*4 Pet., 511.) It has also been held that by the law of nations the inhabitants, citizens, or subjects of acquired or ceded territory retain all their rights of property not taken from them by orders of the conqueror or by the laws of the sovereign acquiring the same. *(Mitchell*v. *United States,*9 Pet., 711.) Nor is title derived by grant to be affected by the political authorities of the new sovereign otherwise than other property of the inhabitants. *(Doe Ex Dem. Barbarie*v. *Eslava,*9 How., 421, cited in *Cofee*v. *Groover,*123 U. S., 10.)

In the case of *Cessna*v. *United States*(169 U. S., 165, 186) the court observed: “ It is the duty of a nation receiving"'a cession of territory to respect all rights of property *45as those rights were recognized by the nation making the cession, but it is no part of its duty to fight the wrongs which the grantor may have theretofore committed.”

This, however, in the absence of a stipulation in the treaty therefor, does not mean that the United States assumed the-personal obligations or debts of the Spanish Government to individuals or corporations unless under the rules of international law they thereby became liable. When the United States succeeded to the sovereignty of Spain over the islands they were under no more obligation to continue the contracts for public or private service of individuals or corporations than they were to continue in office officials appointed by the Spanish Government. *(Sanchez*v. *United*States, 42 C. Cls., 458; affirmed 216 U. S., 167.)

The cables so constructed under the grants or contracts aforesaid were not public property belonging to the Crown of Spain, and therefore did not pass to the United States by the treaty, but were the private property of the claimant, and, so far as the averments of the petition show, were so recognized by the United States.

In construing the act of our jurisdiction as it then existed, Revised Statutes, section 1059, the court in the case of *Great Western Insurance Co.*v. *United States*(112 U. S., 193), affirming this court (19 C. Cls., 206), held that the jurisdiction of the court did not extend to claims growing out of or dependent on treaty stipulations with foreign nations, and that as the claim then under consideration was for part of the money received from Great Britain in payment of the award made at Geneva under the treaty of Washington, the court had no jurisdiction. To the same effect also is the case of *Alling and another*v. *United States*(114 U. S., 562).

Thereafter the jurisdiction of the court was enlarged by section 1 of the act of March 3, 1887 (24 Stat. L., 505), and by section 16 thereof all laws and parts of laws inconsistent therewith were repealed.

Since the passage of the latter act doubt has been suggested both by the Supreme Court and this court whether said act did not repeal section 1066. *(United States*v. Weld, 127 U. S., 51; affirming this court, 23 C. Cls., 129, and *46*Juragua Irdn Go.*v. *United*States, 212 U. S., 297, 310, affirming this court, 42 C. Cls., 99.) But by the recent act “ to codify, revise, and amend the laws relating to the judiciary,” approved March 3, 1911, section 1066, as well as the act of March 3, 1887 — omitting the repealing section in the latter act — were both reenacted, to take effect January 1, 1912, long subsequent, however, to the treaty of Paris.

That it was the purpose of Congress by the reenactment of section 1066 and the omission of the repealing section in the act of 1887 — when the act took effect — to exclude claims growing out of or dependent on treaty stipulations with foreign, nations from the jurisdiction of the court, might, perhaps, be considered as removing the doubts theretofore existing; but it is not necessary to now pass upon this question, for, as we view it, the claim herein is not one growing out of or dependent on any stipulation in the treaty of Paris. As was said by the court in the case of *United States*v. *Weld*(127 U. S., 51, 57), “ In our view of the case, the statute contemplates a direct and proximate connection between the treaty and the claim, in order to bring such claim within the class excluded from the jurisdiction of the Court of Claims’ by section 1066, Revised Statutes. In order to make the claim one arising out of the treaty within the meaning of section 1066, Revised Statutes, the *right*itself, which the petition makes to be the foundation of the claim, must have its origin — derive its life and existence — from some treaty stipulation.”

As there is no stipulation for the assumption by the United States of the claim herein or of the colonial obligations or debts of the Spanish Government upon which the right itself can be based, it can not be held that the claim herein had its origin under or derives its life and existence from any stipulation in the treaty, though protected, if existing, from impairment by Article VIII. So, if any obligation arises to pay the claim it must be outside and therefore independent of the treaty. Force is given to this view by the action of the commissioners negotiating the treaty even as to debts existing against Spain at the time of the cession. On behalf of the Spanish Government the commissioners endeavored to have *47incorporated in the treaty articles to the effect that the colonial grants and contracts for public works and services in the ceded territory should thereafter be maintained, and that the United States should assume all the rights and obligations of the Government of Spain. But the commissioners on behalf of the United States rejected the articles so proposed, stating “ that they would not accept any articles that required the United States to assume the so-called colonial debts of Spain.” They further stated that they disclaimed “ any purpose of their Government to disregard the obligations of international law in respect to such contracts as investigation may show to be valid and binding upon the United States as successor in sovereignty in the ceded territory.” (S. Doc. 62, 55th Cong., 8d sess., pp. 240, 241.) From this it may fairly be said that the claim does not arise out of or depend on the treaty, although but for the treaty no such claim could have arisen.

The claimant also contends that the use of the cables for governmental and other purposes operated as an election ratifying the benefits arising under the contract with the Spanish Government, and that therefore the United States should pay not only the reasonable rates for the transmission of messages, but in addition thereto the annual subsidy so agreed to be paid by the Spanish Government. In other words, the contention is that by the use of the cables for governmental and other purposes the Government in effect ratified the contract so entered into by the claimant with the Spanish Government.

It is not averred in the petition that the rates paid by the Government for messages transmitted over the cables for governmental and other purposes were under and pursuant to the terms of the concession to the claimant by the Spanish Government; but if we were to assume that such, was the inference from the averments, that would not, in the absence of legislative authority therefor, bind the Government to pay the annual subsidy.

When the United States took possession of the ceded territory they were under no obligation to use the claimant’s cables, either in execution of its contract with Spain or *48otherwise. If it did so, an implied obligation arose to make reasonable compensation for such use. But for this use— the transmission of messages — we now understand compensation has been made, so the only claim is for the annual subsidy under the terms of the concession from or contract with Spain.

The general jurisdiction of this court arises under section 1 of the act of March 3, 1887, supra, giving the court “ jurisdiction to hear and determine, so far as material here, the following matters:

> “First. All claims founded upon the Constitution of the United States or any law of Congress, except for pensions, or upon any regulation of an executive department, or upon any contract, expressed or implied, with the Government of the United States, or for damages, liquidated or unliquidated, in cases not sounding in tort, in respect of which claims the party would be entitled to redress against the United States either in a court of law, equity, or admiralty if the United States were suable; * * * .”

In considering the classes of cases involved under that section the Supreme Court, in the case of *Dooley*v. *United States*(182 U. S., 222, 224), said: “ The first section evidently contemplates four distinct classes of cases: (1) Those founded upon the Constitution or any law of Congress, with an exception of pension cases; (2) cases founded upon a regulation of an executive department; (3) cases of contract, express or implied, with the Government; (4) actions for damages, liquidated or unliquidated, in cases *not sounding in tort.*The words *1*not sounding in tort5 are in terms referable to the fourth class of cases.”

It will be observed that the claim herein does not arise under the Constitution, or any law of Congress, or any regulation of an executive department, or upon any contract, express or implied, *with*the United States.

It is not averred that the Government seized or took physical possession of the cables or that, as sovereign over the islands, it did other than assume jurisdiction and control over all property and property rights therein, including the submarine cable and telegraph lines of the claimant, using the latter for its governmental and other purposes, for which it made compensation.

*49There is no averment that the rights of the claimant in and to the ownership and control of its cable and telegraph lines were in any way interrupted or interfered with by the officers of the Government other than for the transmission of messages, for which compensation was made; and if they were, such acts would constitute a tort, over which this court would have no jurisdiction.

Claims for damages, liquidated or *unliquidated*— not *sounding in tort*— of which this court would have jurisdiction, usually, if not always, .arise out of a breach of some contractual relation with the Government. The breach of an express contract, in the absence of a specific stipulation, gives rise to an action for unliquidated damages; and so an action for unliquidated damages arises out of an implied contract, as where by authority of Congress private property is taken for public use.

If we should distinguish between an implied and a *quasi*•contract, the acts of the parties have not been such as to create the legal relation of *ohligatio quasi ex contractu.*

The obligation of Spain to the claimant was not the obligation of the Philippine Archipelago, though the Spanish Government saw fit to pay the subsidy out of the revenues of the islands; but if we were to assume that it was, the United States, in the absence of treaty stipulation, such as is referred to in *Hall’s International*Law, sec. 28, p. 104, would not be liable therefor. If we were to assume that the obligations of Spain to the claimant was a general debt of the Spanish Government, it would be a personal one, as laid down in *Hall's International Law,*p. 99, *note;*and being a personal obligation would not, in the absence of a treaty stipulation therefor, attach to the United States.

We reach the conclusion, then, that the claim herein is not embraced in either class under the act of 1887; and therefore if it arises at all it must be under international law.

We have examined with some care the able brief of counsel for the claimant along this line, but we are unable to agree with him that the authorities cited are controlling, especially on the question of the court’s jurisdiction; for if we were to assume that the claim is one arising under interna-

4 *50tional law, the question whether the Court of Claims is the appropriate jurisdiction to determine the matter would still be open. True, the court in the case of *The Paquete Habana*(175 U. S., 677, 700) said: “International law is part of our law and must be ascertained and administered by the courts of justice of appropriate jurisdiction as often as questions of right depending upon it are duly presented for their determination. For this purpose, where there is no treaty and no controlling executive or legislative act or judicial decision, resort must be had to the customs and usages of civilized nations.” * * *

The court must first acquire jurisdiction before it can ascertain the rights of the parties under international law and administer thereon. As the former is lacking in the present case, the court is without jurisdiction to determine the question, and therefore the demurrer must be sustained, which is accordingly done, and the petition dismissed.

Howry, J., was not present when this case was tried and took no part in the decision.