Spain claimed the Pacific as its exclusive territory by right of the Treaty of Tordesillas (1494). Britain argued that navigation was open to any nation, and territorial claims had to be backed by effective occupation. British and Spanish claims to the Pacific Northwest had overlapped since the 16th century. In July 1789 Esteban Martínez, Spanish commandant at Nootka Sound, seized several British merchant ships. Britain demanded compensation and threatened war, but Spain declined to pay compensation and prepared for war, hoping its long-standing Bourbon ally, France, would provide assistance.
The resulting crisis brought the two nations close to war, but the Spanish backed off after realizing that without the help of France – distracted by the Revolution – they could not hope to match British naval power. They settled with the Nootka Convention (signed October 28, 1790), in which the Spanish acknowledged the British right to maintain outposts in Nootka Sound and engage in whaling outside a “Ten-League Line” off the Northwest coast. Peace in the Pacific allowed for commerce to the Hawaiian Islands to expand, as well as expand the roles of a new player, the US.