
    THE EASTERN EXTENSION, AUSTRALASIA & CHINA TELEGRAPH CO. v. THE UNITED STATES.
    [46 C. Cls. R., 646 ; 48 C. Cls. R, 33; 231 U. S. R., 326.]
    
      On the plaintiffs'1 appeal.
    
    At the time of the cession of the Philippines to the United States a British corporation has procured from the Spanish Government grants and concessions for the establishment of submarine cables to be- worked by the company at its own expense for an annual subsidy of 4,500 pounds. After the cession of the islands the United States use the cables in their public business. The company brings this suit to recover the subsidy assured to it by Spain as its compensation for such service. The defendants move to dismiss the case under Revised Statutes (see. 1066) prohibiting the court from entertaining jurisdiction of claims “growing out of or dependent on any treaty stipulation entered into with foreign nations.”
    
    The court below decides:
    I. By the treaty of Paris, December 10, 1898, the control and sovereignty of Spain over the Philippine Archipelago passed to the United States. Ail buildings, wharves, and public property which belonged to the public domain were ceded or relinquished to the United States; but it was expressly provided that the cession and relinquishment should not “impair the property or rights which by law belonged to the peaceful possession of property of all lemds ” whether “ of civic bodies or of private individuals of lohatsoever nationality such individuals may be.” The cables owned by the claimant under the Spanish concession are such private property.
    II.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 itself must have its origin in and derive its life and existence from the treaty.
    III. The right of action in this ease grows out of the use of private property, the claimant’s marine cables, by the defendants for public purposes; and the fact that the claimant acquired its property by a concession of the Spanish Government and had entered into an agreement with that Government for rendering service does not affect the obligation of the United States.
    IV. But the obligation of the Spanish Government to the company does not extend to the United States as successors of the public property of Spain. The measure of damages, if the claimant be entitled to recover, will be the reasonable compensation for the use of the cables upon an implied contract, and not the compensation prescribed by the company’s express contract with Spain.
    V.Whether the provision of the Revised Statutes (sec. 1066), which excludes from this court jurisdiction of claims “ growing out of or dependent on any treaty stipulation with foreign nations," has been repealed, and whether the court has or has not jurisdiction of such claims, are questions upon which the court does not pass at this time.
    On defendants’ demurrer the court below further decides:
    I.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.
    II.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.
    III.Whether the provision of the Revised Statutes, see. 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 decision of the court below is reversed, the Supreme Court holding that there was jurisdiction to pass upon the claim under the limitations stated, and the cause remanded, with instructions to take further proceedings.
   Me. Justice Holmes

delivered the opinion of the Supreme Court December 1, 1918.  