Reverdy Johnson, Esq., &c., &c., &c.
Lord Lyons to Mr. Cass
Washington.
December 10, 1860.
Sir: In the note which you did me the honor
to address me on the 25th June last, you informed me that the
President was equally solicitous with the government of her Majesty
for the amicable and satisfactory adjustment of the questions at
issue between the two countries respecting the execution of the
treaty signed at Washington on the 15th June, 1846. You added that
the government of the United States would be ready to receive and
fairly to consider any proposition which her Majesty’s government
might be disposed to make for a mutually acceptable adjustment, with
an earnest hope that a satisfactory arrangement would speedily put
an end to all danger of the recurrence of those grave questions
which have more than once threatened to interrupt that good
understanding which both countries have so many powerful motives to
maintain.
The absence from England of her Majesty’s secretary of state for the
colonies prevented her Majesty’s government from enabling me to make
an earlier reply to this communication. But her Majesty’s government
have not relaxed in their desire to close the controversy with
regard to the complete execution of the treaty; and, in the
confident hope of settling the whole matter in a manner satisfactory
and honorable to both parties, they have directed me to lay before
you the proposals which I shall proceed to state in this note.
The two points which have been in discussion are, first, the
fulfillment of the obligations undertaken by the United States in
respect to the Hudson’s Bay and Puget Sound Companies; and,
secondly, the determination of the line of water boundary intended
by the first article of the treaty. With regard to the first point,
the President said to me, in the course of a conversation which I
had the honor of holding with him on the 11th July last, that the
best and most expeditious mode of settling the question would be for
the companies to state at once the lowest sum for which they would
sell their rights to the United States. Upon receiving from me a
report of this conversation, Lord John Russell, her Majesty’s
principal secretary of state for foreign affairs, sent for the
governor of the Hudson’s Bay Company and explained to him what the
President had said to me on the subject of the company’s claims.
The governor informed Lord John Russell, in reply, that if the
company were called upon to fix the amount which they should ask for
the extinction of their claims, they should name a sum of $650,000.
He observed that they had been assessed at $700,000, and that in the
United States, as in England, the assessment is always below the
real value. The governor added that this sum of $650,000 would be an
assessment on land and buildings alone, and would not include any
compensation for privileges.
Considering all the circumstances, Lord John Russell recommended the
company to reduce their claim to $500,000; and this sum the company
have stated their readiness to accept.
I am, accordingly, instructed to state to you, sir, that if the
United States government will agree to pay to the Hudson’s Bay and
Puget Sound Companies a sum of $500,000 in extinction of all their
claims against the United States under the treaty of June 15, 1846,
her Majesty’s government will be prepared to accept that amount on
behalf of the two companies, and to release the United States
government from all further liability, so far as regards their
engagements to Great Britain under the third and fourth articles of
that treaty in behalf of the Hudson’s Bay and Puget Sound Companies
in Oregon, whether on account of lands and buildings, or on account
of privileges mentioned in the aforesaid articles.
In reference to the line of the water boundary intended by the
treaty, with respect to which, also, her Majesty’s government have
been invited by the United States government to make a proposition
for its adjustment, I am instructed to inform you that her Majesty’s
government are glad to reciprocate the friendly sentiments expressed
in your note of the 25th of June, and will not hesitate to respond
to the invitation which has been made to them.
It appears to her Majesty’s government that, the argument on both
sides being nearly exhausted, and neither party having succeeded in
producing conviction on the other, the question can only be settled
by arbitration.
Three questions would arise thereupon—
1. What is to be the subject matter of arbitration?
2. Who is to be the arbiter?
3. What is to be the result of the decision of the arbiter?
With regard to the first point, her Majesty’s government are of
opinion that the question or questions to be referred should be,
What is the meaning of the words relating to the water boundary
contained in article 1 of the treaty of June 15, 1846; or, if the
precise line intended cannot be ascertained, is there any line which
will furnish an, equitable solution of the difficulty, and is the
nearest approximation that can be made to an accurate construction
of the words of the treaty?
In considering these questions the arbiter might fairly consult all
the correspondence on the subject, and weigh the testimony of the
British and American negotiators of the treaty as to their
intentions in framing the article; but he should not depart from the
true meaning of the article as it stands, if he can deduce it from
the words agreed to by both parties, and consigned in a treaty
ratified by both governments.
Secondly, her Majesty’s government are of opinion that a reigning
prince or sovereign state should be the arbiter; her Majesty’s
government propose, with this view, that the King of the
Netherlands, or King of Sweden and Norway, or the President of the
federal council of Switzerland, should be invited to be the
arbiter.
With regard to the third point, her Majesty’s government are desirous
that this long controversy should not be again thrown loose for
dispute; they therefore propose that both governments shall bind
themselves to accept the decision of the arbiter, whether he shall
give a positive decision or whether he shall declare that he cannot
fix the precise meaning of the article in question, but that he has
laid down on the chart a line which will furnish an equitable
solution of the difficulty, and is the nearest approximation he can
make to an accurate construction of the words of the treaty.
Should these proposals be accepted, her Majesty’s government flatter
themselves that an equitable decision may be arrived at and a long
and dangerous controversy terminated in a manner consistent with the
honor and the interests of both governments.
I have the honor to be, sir, with the highest consideration, your
most obedient, humble servant,
Hon. General Lewis Cass, Secretary of State.
