Mr. Nelson to Mr. Seward.

No. 123.]

Sir: In my despatch No. 99, of July 17, 1863, I had the honor to inform you of the conditional declaration of war made by Bolivia against Chili, founded. upon the alleged wrongful appropriation by the latter of some three degrees of latitude belonging to the former republic.

In view of the evident determination of both republics to adhere to their claims to the disputed territory, and of the apparent impossibility of deciding by negotiation the questions involved, and in view of the interest held by our government in the settlement of the “Alsop & Co.” and “Sportsman” claims, both dependent, principally, upon the decision of the questions involved in the discussion between the aforesaid republics, I ventured to suggest in my despatch No. 102, of August 1, 1863, that I be instructed to propose the reference of all the points in dispute to the arbitration of some friendly power.

In your despatch No. 48, of September 16, 1863, acknowledging the receipt of my last named communication, you stated “that it would be preferable for [Page 174] those republics to refer their respective territorial pretensions to the arbitrament of a third power.”

At the date of the receipt of this despatch, Doctor Thomas Frias, the minister plenipotentiary of Bolivia, had arrived in Santiago charged with the special mission of endeavoring to settle the question of territorial jurisdiction pending between that republic and Chili.

Doctor Frias had been especially charged by his government to consult with me upon the objects of his mission; and, after a number of conferences, I deemed it most decorous to defer the presentation of my proposition of arbitration until he had had an opportunity of presenting the views of his government, and of arranging, if possible, the question of limits, without the interference of a third party, intending to reserve my appeal until a time when every other resource had been exhausted, and when its effect would, perhaps, be more salutary.

A very voluminous correspondence ensued between the minister of Bolivia and the secretary of foreign relations. The latter insisted upon the withdrawal of the conditional declaration of war issued at Oruro June 5, 1863, by the Congress of Bolivia, and upon indemnity being granted to Don Matias Torres, a Chilian citizen, alleged to have been imprisoned and otherwise ill-treated by the Bolivian authorities, for exporting guano from the disputed territory, under license from the Chilian authorities. Mr. Frias, on the other hand, asked the sequestration of the disputed territory until the question should be definitely settled.

These demands were regarded by the respective ministers as conditions precedent to the discussion of the main question; but Mr. Frias finally desisted from his demand of sequestration, and simply asked that orders be given to prohibit further exportation of guano from the disputed territory pending the question of jurisdiction, but declined, at the same time, to accede to the demands of Chili, alleging that the conditional declaration of war by Bolivia was purely a domestic act, and that the criminal prosecution against Torres had been already suspended.

M. Tocornal having peremptorily declined to order such prohibition, M. Frias, upon the 24th ultimo, requested his passports, and upon the 2d instant sailed for Bolivia, diplomatic relations being thus entirely suspended between the two countries.

Upon the 25th ultimo, upon being apprised of these facts, I addressed a note (see enclosure A) to the secretary of foreign relations, deprecating the cessation of friendly relations between the two republics, and earnestly advising a reference of all the questions in dispute to arbitration.

To add force to my suggestion, the concluding paragraphs of my note were in language almost identical with that of M. Tocornal’s own note of December 30, 1863, addressed to the cabinets of Quito and Bogota, imploring those republics to refrain from fratricidal strife, and giving up, each one, some portion of its pretensions, to submit the questions involved to the arbitration of some friendly power.

Upon the 7th instant the secretary of foreign relations addressed me, in reply, a communication, a copy and translation of which form enclosures B and C, wherein, after expressing the gratitude of his government for the friendly interest taken in the affair by my government and by this legation, he stated that the question of boundary had never been reached in the discussion between himself and the representative of Bolivia; that the honor and dignity of Chili demanded that, before entering upon the discussion of the main question, Bolivia should withdraw the threat implied in the conditional declaration of war, and should indemnify Torres; that the minister of Bolivia had distinctly refused compliance with the demands of Chili; that, while Chili was loyally anxious to enter upon the discussion of the main question, this refusal of Bolivia rendered it impossible; that Peru had tendered its good offices and friendly mediation for the settlement [Page 175] of the boundary question, and that the government of Chili had hastened to inform it that, under these circumstances, it was with great regret obliged to decline availing itself at present of so generous an offer; that from that time to the present the state of affairs having undergone no change whatever favorable to mediation, he found himself compelled to give to this legation the same reply as that given to Peru.

Expressing a determination to avoid as far as possible the painful consequences which might result from this rupture, and a hope that Bolivia may yet return upon her steps and offer to Chili the reparation she demands as a condition precedent to all discussion, his excellency concluded by stating that in such an event it would be very grateful to Chili to recur, if necessary, to the friendly offices of the United States.

It will be observed that while my suggestion of arbitration embraced all the points in dispute between the two republics, the secretary of foreign relations, in his reply, has deemed proper to consider the boundary question as alone referred to.

It is my opinion that Chili will avoid a reference to arbitration of the questions in dispute, and that she will maintain her claim to jurisdiction over the desert of Atacama, especially since Bolivia is not in a position to recur to other arguments than those of diplomacy.

M. Tocornal having expressed a desire to publish the notes exchanged between this legation and the department of foreign relations upon the Chili-Bolivian question, I gave my consent thereto, and, upon the 19th instant, the correspondence appeared in the “Arancano,” the official organ of the government. It was very generally copied into the newspapers of the country, and commented upon by them in a spirit of cordial good feeling towards the United States. (See enclosure D.)

While the instructions given me upon this subject were of a character more general than specific, I have thought it my duty to do all in my power to avert the disastrous consequences of a war between two sister republics of America, deeming it important not only to cultivate the most friendly relations between our own country and that to which I have the honor to be accredited, but also to interpose the good offices of our government to prevent the severance of those friendly bonds between the country of my residence and neighboring republics. I trust that my action in the premises may be approved.

I have the honor to remain, very respectfully, your obedient servant,

THOMAS H. NELSON.

Hon. William H. Seward, Secretary of State of the United States.