Mr. Gana to Mr. Gresham.

Sir: My Government has carefully considered the contents of your excellency’s esteemed note of the 13th of August last relative to the reciprocal claims still undecided between the two countries, and it has instructed me to submit to your excellency certain considerations which it feels confident will be received in the same friendly spirit that has dictated them.

My Government thinks that, in view of the number of the claims and their nature, it would be more practical and less expensive to settle them directly, either by means of a gross sum embracing all the claims collectively, or by means of an examination which would render it possible to eliminate those that are without foundation, and to pay the others by means of a compensation based upon a spirit of amicable equity.

It would not be difficult to find precedents, as your excellency is aware, that would warrant the adoption of either of the methods proposed. I have had the honor to state to your excellency that the principal nations of Europe have settled difficulties of the same kind which they had with Chile by means of collective arrangements for a [Page 92] conventional amount. The United States Government has also had recourse to the same amicable means for the settlement of claims which formerly existed with Denmark, France, Peru, and Spain.

The second method, viz, a previous examination of the claims with a view to the elimination of those which have no reasonable foundation, and to settling such as may be found just by the payment of a suitable compensation, is daily resorted to by all Governments in their relations with one another.

It will be sufficient for me to call attention to the fact that your excellency’s Government made no objection whatever to the adoption of this latter method before the conclusion of the convention of August 7, but that, on the contrary, it was prepared to accept and second it with decided interest. In the note addressed under date of September 30, 1890, by Mr. Egan, then United States minister plenipotentiary, to the minister of foreign relations, that gentleman wrote as follows:

In an interview which I had the honor to have with His Excellency the President of the Republic relative to the claims of citizens of the United States against the Government of Chile, his excellency was pleased to suggest the propriety of furnishing data with respect to all those claims, with a view to reaching a speedy investigation of the grounds on which they were based, and an amicable settlement, either by means of a direct arrangement or by submitting the case to arbitration.

In accordance with this suggestion, and being actuated by the spirit of sincere friendship which happily characterizes the relations existing between the two countries, I have the honor to send your excellency, for the information of your Government, a list of these claims, together with a brief statement with regard to the nature of each.

After enumerating the said claims Mr. Egan ended his communication as follows:

I can assure your excellency that my Government has no desire to support any claim that does not appear to be founded upon right and justice; and at the same time I entertain the fullest confidence that the Government of Chile will give proper attention to all claims that are found to be just and meritorious, and that it will pay them in full. I consequently desire here to state that whenever your excellency’s Government may think proper to proceed to an investigation of the above-mentioned claims I shall take great pleasure and shall deem it my duty to cooperate, by the exhibition of the documents concerned and in any other way, in throwing all necessary light upon the grounds of each one of the claims.

These antecedents and the amicable spirit which happily governs the relations between the two Governments lead that of Chile to entertain the well founded hope that your excellency’s Government will be willing to take into kind consideration either of the two suggestions which I have the honor to lay before you.

I avail, etc.

Domingo Gana.