Mr. Tillman to Mr. Olney.

No. 70.]

Sir: I have the honor to state that I have just received from the minister of foreign affairs copy of a dispatch from General Alfaro, the governor of Guayas, submitting terms of a settlement of the Santos claim, suggested by the claimant. The telegram declares that the terms are subject to the ratification of the American minister here and that the payments shall be made to the State Department at Washington. Since an agreement has not yet been reached, I do not for this reason and for want of time transmit herewith the telegram and translation, but I would like the Department to inform me by cable if I should approve any settlement which the claimant may make with the Government of Ecuador. It occurs to me that whatever arrangements may be made by Santos with Ecuador would be satisfactory to the United States, provided the payments were made by Ecuador to the Government of the United States.

Without further instructions no settlement of the Santos claim will have my official approval, though, as above stated, I suppose whatever is satisfactory to him will be to the Government.

I have, etc.,

James D. Tillman.