Britain Demands Appeal To Hague.

New York Times 100 years ago today, September 3, 1912:
Official Announcement — It Is Believed Instructions Are Now on Way to Washington.
WE MAY FLATLY REFUSE
Two-Thirds Vote of Senate Necessary for Reference to Arbitration.
DELAY IN REPLY LIKELY
President Taft Will, It Is Thought, Wait for Secretary Knox's Return from Japan In October.
    LONDON, Tuesday, Sept. 3.— It was officially announced last evening that the British Government would make a formal demand upon the United States Government for arbitration of the British claim that the Panama Canal Toll act, as passed recently by the United States Congress and signed by President Taft, violates the Hay-Pauncefote Treaty.
    Nothing definite is known here beyond the brief official announcement that the formal demand for arbitration will be made, but it is believed that instructions are already en route to the British Embassy at Washington concerning the situation.
    The British demand will be made under the Arbitration Convention of 1908. Great Britain's contention will be that the question at issue does not affect the vital interests, independence, or honor of the United States, and that therefore it is clearly within the scope of the 1908 convention, since the matter to be arbitrated is not an act of Congress, but an interpretation of Article III. of the Hay-Pauncefote Treaty.
    The Daily News in an editorial article this morning argues that the British demand for arbitration is made in the spirit of cordiality which has existed between the United States and Great Britain for many years, and which last year brought about an attempt to establish permanent machinery for arbitration, which attempt proved unsuccessful, owing to the adverse action of the American Senate. The Daily News continues:
    "The demand will furnish an excellent test of the working of the system President Taft then hoped to create. It is not wholly to be regretted that the approaching celebration of a centenary of peace between the two nations should be preceded by an opportunity of showing how that peace has been maintained, and will be secured as an enduring monument to the good sense and enlightenment of the English-speaking race."

Special to The New York Times.
    WASHINGTON, Sept. 2.— That Great Britain would press for a reference of the Panama Canal dispute to The Hague was expected here, but officials of the State Department scarcely thought that the official declaration of this purpose would come so soon. The arbitration treaty of 1908 provides that differences of a legal character and affecting the interpretation of treaties which fail to yield to diplomatic settlement shall be arbitrated if the questions at issue do not affect the independence, vital interests, or honor of the contracting parties.
    The first British protest was made when the Senate was disposed to exempt all American shipping from Panama tolls, but the Panama bill as enacted exempts only ships in the American coastwise trade. The protest was also directed against remission of tolls as an evasion of the spirit of the treaty. In the memorandum made public when he signed the bill, President Taft declared that the British protest was a proposal to read into the treaty a surrender of the right of the United States to regulate its own commerce in its own way and by its own methods. Neither Great Britain nor any other country, said the President, would surrender such a right.
    The arbitration treaty provides that a special agreement shall be concluded defining the scope and method of procedure of the arbitration of the question at issue. This must be ratified by a two-thirds vote of the Senate. More than two-thirds of the Senators voting on the Panama bill voted for its enactment with the coastwise shipping exemption of which the British Government now complains.
    When informed to-night of the announcement that the British Government would make formal demand upon the United States for the arbitration of the Panama Canal tolls question, Huntington Wilson, the acting Secretary of State, said he had no comment to make.
    From the attitude of this Government thus far with relation to the dispute, the opinion here is general that the United States will not yield to the demand for arbitration of its right to relieve its coastwise shipping from tolls in the Panama Canal without a prolonged diplomatic struggle. In some quarters the opinion is maintained that the demand will be flatly declined.
    In the latest note from Great Britain, presented to the State Department a week ago by Alfred M. Innes, the British Chargé, it was set forth that, if a careful reading of the Panama act should justify the impression caused by a first perusal, the British Government would feel it necessary to ask that the question be submitted to The Hague Tribunal.
    It is expected that the basis for the State Department's primary declination to accede to this request will be the fact that, as the American coastwise trade has for many years been barred by domestic law to all foreign shipping, it cannot be claimed that British shipping is to be discriminated against by the proposed canal regulations, which at this stage do not apply to foreign commerce. It will be pointed out by the State Department that, so far as that commerce is concerned, British and American shipping will be on terms of perfect equally in the use of the canal.
    It is possible that in the absence of Secretary Knox, who is now on his way to Japan, the State Department will content itself with an acknowledgment of the receipt of the British note requesting arbitration, with a promise to return a formal answer thereto at the time of the return of the Secretary of State to Washington in October.