No. 626.
Mr. Thompson to Mr. Bayard.

No. 153.]

Sir: On the 19th ultimo the National Assembly was called in extraordinary session, which ended the 10th instant; the members were called together in order that they might examine and ratify certain arrangements made by the minister of finance and the National Bank of Hayti on his recent visit to Paris. These were the projects:

A law to establish a new treasury service.
A law to substitute new paper money for that in circulation.
Law converting the exterior debt and consolidating the floating debt.
Law regulating the interior debt (caisse d’amortissement), also the back floating debt. All of these laws were passed.

By the first, a contract has been sanctioned between the National Bank and the Government to the effect that the sum of $283,333.33 is to be paid by the bank to the treasury department at the end of each month for the purpose of paying the current service, as employés, pensions, rations to the army, etc. The bank takes entire charge as guaranty, and pays out from the sum of all duties on imports into the Republic, receiving as compensation 2 per cent, per month on the amount paid out by them, and 9 per cent, per year on advances made. This contract is for five years.

In the second law the Government paper money in circulation at present will be replaced by bank paper, simply an interchange.

It is the third and fourth laws that are interesting to us, and particularly the latter, as affecting the value of the bonds held by American citizens, viz, those of Heuvelmann Haven & Arci, and of Mrs. Fanny Oaksmith.

I inclose herein, marked A, with translation B, copies of the law above named. You will observe that these bonds in value have been reduced 20 per cent., from $100 each to $80 each, and the interest from 6 per cent, to 5 per cent, per annum; and, furthermore, all back interest due thereon, and up to December 31, 1887, instead of being liquidated, is to be converted into the new $80 bonds.

As there is but little time for action (six weeks) before these bonds are to be changed, without losing six months’ interest, and in view of the fact that the above cited bonds were obtained for our citizens by instructions from the Department, and through the good offices of my predecessors, and believing I am only anticipating instructions had time permitted them to have been requested by me and received in the premises, I have addressed dispatches to the secretary of state of foreign affairs relating to these bonds, as to their value and the back interest. [Page 878] Copies of such dispatches are herein inclosed, marked, respectively, C and D. There are many thousands of dollars’ worth of similar bonds held by merchants and brokers here who have bought the same from time to time for a mere bagatelle, while our citizens received these bonds for their face value, probably with implicit confidence; therefore, I do not believe they should be placed in the same category with commercial speculators in this city. True, these were not international debts, but at the time the Department was interested in their payment, and the minister accredited here was instructed to occupy himself with their settlement; this is the reason for the action I have taken.

As soon as I can state anything relating to this subject, and at all events continuing the same line of argument unless instructed otherwise, I will inform you of the result when obtained from the foreign office.

I have, etc.,

John E. W. Thompson.
[Inclosure 1 in No. 153.—Translation.]

Law regulating caisse d’amortissement bonds and floating debt—regulating the interior debt, called the sinking fund, as well as the back floating debt.

Salomon, President of Hayti:

Whereas (1) That the definite regulating of the interior debt of the country becomes obligatory for the order and the regularity of our financial administration.

(2) That it is necessary to appropriate in payment of the interest and the sinking fund of this debt special and sure resources, so as to assure hereafter the reimbursement, at fixed dates and on simple presentation at the wicket of the National Bank, of the snares due, or of the titles to be withdrawn after the drawing by lot.

(3) That under these conditions of the regularity of payments a light sacrifice, the same as the holders of the exterior debt have made, imposes itself on those of the interior debt, who will no longer be exposed to the long delays or the exactions of a too onerous brokerage.

Considering (1) The law of November 17, 1876, tending to the creation into a sinking fund of the arreared public debt; (2) the additional of August 26, 1877; (3) the contract signed at Paris, August 11, 1887, between the delegate of the Government and the National Bank.

From the advice of the council of the secretaries of state has proposed and the legislative body has voted the following law:

Art. 1. The interior debt in arrear is composed hereafter of the old titles of 100 gourdes of articles 6, 7, and 9 of the sinking fund bearing 6 per cent. per year; (2) of all pay orders for salary whatever drawn up monthly and unpaid up to September 30 last; (3) of the interests due on the titles of the sinking fund up to December 31, 1887; (4) of all the public effects suffering; (5) of the amount of the commission of 2 per cent, allowed to the National Bank on the nominal capital of the debt to be converted and consolidated.

In that which concerns the special titles bearing 18 per cent, it is left to the Government the faculty to take in their regard all just and lawful measures so as to safeguard the interest of the State.

Art. 2. Commissions, in which the bank shall always be represented, shall be instituted by the Government for the verification of all the categories, of title spoken of in the preceding article.

Art. 3. For each of the old titles of articles 6, 7, and 9 of the sinking fund verified and recognized as valuable there will be delivered through the agency of the National Bank to the party entitled thereto a new title of 80 gourdes; the titles of the other categories shall be of 100 gourdes each.

They shall bring 5 per cent, interest per year; they shall be of different colors numbered by categories, have attached half-yearly coupons and bearing three signatures—that of the one encharged with the service of the sinking fund, that of a member delegated from the chief comptroller’s office, and for control that of the director of the National Bank.

Art. 4 The fractions resulting from the couponing of the values shall be inscribed [Page 879] on a special register of the bank; a receipt shall be given, and a public regulating commission will make known what shall be decided in regard to them.

Art 5. The old titles of public effects, and whatever withdrawn from circulation, shall be canceled under the care of the bank, with mention made of the respective numbers that snail replace them, classified and bundled up to be remitted to the secretary of state of nuances.

Art. 6. The interests on the old titles of the sinking fund shall cease from January 1, 1888.

The holders who exchange their titles before that date will alone have the right to receive interest for the first semester. After that delay the others will have right only to interest of the following semester that comes after that of the exchange of their title.

Art. 7. After the 1st of January, 1889, no titles whatever will be exchanged, and all reclamation in this regard will be null and of no account.

Art. 8. The service of the interest on the new titles shall take place on the 1st of January and the 1st of July of each year, at the wicket of the National Bank at Port au Prince in return for the expired coupon. In consequence, and as it is stipulated in article 6, the first coupon shall be paid the first of July of the same year.

Art. 9. Independently of the service of interest there shall be operated on the capital of the new titles a sinking fund of 1 per cent, per year, the said sinking fund augmenting itself each year gradually from the interest of the canceled titles of the preceding year.

The sinking fund shall be annual and shall take place by drawing by lot the 1st of June of each year for the re-imbursement of the titles to be made on the 1st of July following.

The titles coming from the wheel in the drawing that shall take place publicly at the National Bank, under the care of the latter and in the presence of a delegate of the secretary of state of finances and of the one encharged with the sinking fund, cease to have any right to interest from July 1st.

The first drawing will take place on the 1st of June, 1888.

Art. 10. As soon as the work of conversion and consolidation shall be finished by the exchange of the titles there shall be drawn up a table for each category of the interior debt, fixed as is stated in articles 1 and 2.

The total extinction of the debt, after the basis laid down in article 9, shall be fixed later.

Art. 11. To assure the service established by the present, the Government delegates to the National Bank from January 1, 1888, and as specially affected title, a sum of fifty-hundredths of a dollar in gold per 100 pounds of coffee, to be raised on the exportation dues, and the amount shall be converted into national money at the market rate and for the account of the Government.

Art. 12. By means of this declaration the bank engages itself to perform the service of which it is question, and to open in its books a special account to that effect in accumulating the receipts effectuated to apply the amount to the payment of the half-yearly coupons and the sinking-fund titles.

The Government on its part forbids the touching of the funds for any motive whatever.

Art. 13. In case that this amount set apart is not sufficient to secure at the end of a half year, or of one year, the payment of the interests due and the liquidation, the Government engages itself, so as to avoid all interruption in the payments to be made, to make good the deficiency by means of other resources; if there is an excess it will be entered by right to the credit of the account opened for that purpose.

Art. 14. There shall be allowed to the bank a commission of 1½ per cent. on the service of the interests and of the interior debt converted or consolidated.

Art. 15. The present law abrogates all laws or provisions of laws that are contrary thereto; it shall be printed, published, and executed at the diligence of the secretary of state of finance and of commerce.

Given at the Palace of the National House at Port au Prince, November 7, 1887, the eighty-fourth year of the Independence.

The president of the senate.

M. Montasse.

The secretaries:

S. M. Pierre.


Given at the House of Representatives, at Port au Prince, November 8, 1887, the eighty-fourth year of Independence.

The president of the House:

J. C. Antoine.

The secretaries:

Cl. Lafontant.

Jh. Codio, Jr.

[Page 880]

In the name of the Republic:

The President of Hayti orders that the above law of the legislative body be vested with the seal of the Republic, printed, published, and executed.

By the President:
Salomon .

The secretary of stats of finances and of commerce:

C. Fouchard .
[Inclosure 2 in No. 153.]

Mr. Thompson to Mr. St. Victor.

No. 56.]

Mr. Minister: The undersigned minister resident of the United States of America has the honor to invite the attention of the Hon. Brutus St. Victor, secretary of state of foreign relations, to the law passed the 9th instant relative to the bonds of the Caisse d’Amortissement, as bearing connection with such of those bonds held by this legation for American citizens.

The undersigned allows himself to remark that since the aforesaid bonds held at this legation are not such as were obtained by purchase at low rates as a speculation, bat were given by the Haytien Government in payment of claims in lieu of advancing the same amounts in specie currency to settle these ascertained claims, it is not just to lower their face value and diminish by 1 per cent, the interest they should by law call for annually.

The undersigned feels certain that the Haytien Government, in its equitableness, will discriminate between the bonds herein-above mentioned and those obtained by purchase as a commercial transaction.

It may be well to state that the bonds intrusted to the custody of this legation were obtained by agreement between the representative of the United States on one side, and the secretary of state of foreign affairs of Hayti on the other; consequently each bond in comparison to those obtained otherwise may safely be considered a bond sui generis, and this may be well illustrated by the fact that there has been no traffic whatever in the interest payments.

The undersigned requests most respectfully of the honorable minister for foreign affairs to examine the particular cases herein stated, and to agree that there should in no way be a change in the value of obligations when given internationally, by diplomatic intervention and arrangement. Relying on a response to this dispatch at an early day, I avail, etc.,

John E. W. Thompson.
[Inclosure 3 in No. 153.]

Mr. Thompson to Mr. St. Victor.

No. 57.]

Sir: I have the honor to call your particular attention to the contents of your dispatch dated June 1, 1887. wherein it states that on the return of the honorable minister of finance and commerce, the payment to such date would be made (à la péiode échue jusque’à ce retour), of the interest on such bonds of the Caisse d’Amortissement as are held at this legation for certain American citizens.

The undersigned, in placing this subject before the honorable minister for foreign affairs, allows himself to remark, in view of the report already having been made that such interest was assured for and up to the month of October ultimo, that it will give him great satisfaction to confirm such report.

Awaiting therefore a reply at your earliest convenience, I beg, etc.,

John E. W. Thompson.