Mr. Gresham to Mr. Gana.

Sir: I have the honor to acknowledge your note of the 28th ultimo, submitting the suggestion of your Government that the claims not decided by the American Chilean commission, which recently sat at Washington, be adjusted by paying such an amount of the face of such claims as the aggregate amount awarded by the commission on claims which they did consider bears to the face amount of the latter claims.

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In reply I have the honor to say to your excellency that this Government does not feel warranted in consenting to such an arrangement. It thinks that each and every claim should be examined and settled upon its merits, by an international commission.

Accept, Mr. Minister, the renewed assurance of my highest consideration.

I am, etc.,

W. Q. Gresham.