No. 27.
General Schenck to Mr. Fish.


Your telegram of yesterday received to-day.

Will endeavor to see Granville to-night or early to-morrow. Will urge him to modify his proposal in accordance with your views. Will you examine it, including introductory paragraphs as given in my telegrams of April 30 and May 3, and, taking it for a basis, suggest exactly what modifications would make it possible for the President to assent to it? Also give me draught of such reply as you would be willing to make. I am confident this Government will not agree to the last paragraph of your telegram of April 27. They may agree that if the United States will engage not to press for award for indirect damages, nothing need be said about any modification of the original Case, nor whether such agreement is a withdrawal or not a withdrawal of any part of that Case. Bather than agree to submit the indirect claims to the judgment of the Tribunal, I apprehend this Government, backed by Parliament, would cease negotiation and make an absolute declaration against proceeding with the arbitration. Could the President assent to their offer if I can get the following substitute for what I telegraphed April 30?

Her Majesty’s Government are now ready to state that if the United States will and do agree not to press for a pecuniary award before the Tribunal of Arbitration at Geneva, on account of claims for indirect losses or damages, namely, the increased premiums of insurance, the transfer of American shipping, and the prolongation of the war, then Her Majesty’s Government will and do, on their part, engage and stipulate that, should Great Britain at any time in the future be a belligerent while the United States is a neutral; and should there be any failure on the part of the United States to observe their neutral obligations, Great Britain will make or advance no complaints or claims against the United States by reason or on account of any indirect, remote, or consequential results of such failure. This rule, or principle, not to advance or press complaints or claims for indirect, remote, or consequential damages, to be mutually and reciprocally observed by both parties in the future. The notes which are exchanged on this subject to be presented to the Tribunal of Arbitration and entered on its record.