Mr. Merry to Mr. Hay.

No. 308.]

Sir: I have the honor to inclose herewith copy of my No. 70, dated August 14, addressed to Hon. Joaquin Sanson, minister of foreign affairs of Nicaragua; copy of his reply, dated August 25, and copy of my No. 76, of this date, replying to him. There is little for me to add, as the letters are self-explanatory. There are two points upon which Senor Sanson and myself differed radically in connection with the Bluefields revolutionary uprising. He insisted that President Zelaya’s proclamation closed the port to all commerce, even though he had no force afloat or on shore during the period of the Reyes revolt (February 3 to 25, 1899) with which to enforce the decree. I persistently claimed that the President’s proclamation, without force afloat or on shore to [Page 805] give effect, could not close a port against peaceable commerce. He insisted that the Reyes revolutionary government was not a de facto government; that the merchants at Bluefields had aided a revolutionary movement by paying to the leaders thereof any money whatever, and consequently deserved to lose it. My argument to the contrary will be found in inclosure No. 3.

Gen. Tiburcio Bonilla, who succeeds General Estrada, is a military lawyer, ex-judge of the supreme court at Managua, personally known to me as a man of good character, educated two years in the United States and afterwards in France, and a friend to Americans. I think that with his arrival at Bluefields and the commercial reciprocity treaty effective, matters there will proceed peaceably, if the Managua government will permit it. As the newly appointed governor and Judge Roman, newly appointed district judge at Bluefields, may summon the merchants to give evidence before his court in reference to their participation in the Bluefields revolt, may I request that the Department will cable me on receipt hereof, a reply to the following inquiries:

Does the Department consent that the merchants shall attend the court in person and give their evidence on the question?
Does the Department permit that the copies of the affidavits now in its possession, testifying to the neutrality of the merchants in the Bluefields revolt and such other papers appertaining as may be selected from those sent to Washington by Consul Sorsby, shall be presented to said court as evidence? These inquiries are now necessary, because I am not certain that the Department will now permit the case to go before a Nicaraguan court. I await your instructions on the above points.

Consul Sorsby writes me that Mr. Joaquin Sanson has been appointed Nicaraguan consul at New Orleans, at which I am surprised, as it would indicate that his management of foreign affairs at Managua and Bluefields has not been satisfactory to General Zelaya.

With assurances, etc.,

William Lawrence Merry,
United States Minister.
[Inclosure 1.]

Mr. Merry to Mr. Sanson.

Esteemed Sir: I have the honor to forward herewith for the consideration and action of your excellency’s Government, an official letter from the Department of State of the United States relating to the funds now in the custody of Her Britannic Majesty’s consul at San Juan del Norte, by agreement between your excellency and myself, dated April 29, 1899. It will occur to your excellency that, while under said agreement we are not bound to reach a decision regarding the final disposition of said funds within a stated period, we promise therein our best efforts to settle the matter within four months, which period will expire on 29th instant. For this reason and because it is my special desire, in which I am confident your excellency will join me, to remove all causes of friction between our respective Governments, it is very desirable that this matter shall be promptly decided. The facts as stated by the honorable Secretary of State of the United States appear conclusive as to the justice of permitting the repayment by Consul Bingham to the parties in trust for your excellency’s Government and that which I have the honor to represent. Its repayment will be an evidence of justice which will have a moral effect upon the foreign [Page 806] residents of the Department of Zelaya far more valuable than the amount at stake, tending to the public prosperity and development of that fertile section of the Republic of Nicaragua.

Confidently awaiting the favorable action of your excellency’s Government, and with assurances, etc.

William Lawrence Merry,
United States Minister.
[Inclosure 2.]

Mr. Sanson to Mr. Merry.


Mr. Minister: Annexed to your communication of the 14th instant I had the honor to receive authorized copy of that which the honorable Mr. Secretary of State of the United States addressed to your excellency the 26th of July last relative to the Bluefields matters, which were the object of a long discussion between ourselves that terminated with the agreement of the 29th of April of this year.

Your excellency calls the attention of my Government to the opinion of that of the United States in this respect and hopes that in consequence the money that the American merchants deposited with the consul of Her Brittannic Majesty in San Juan del Norte may be returned, which act of justice will be highly appreciated by those citizens, contributing thus to the most friendly relations between the countries interested.

Your excellency admits that although in the referred to agreement no fixed date was stipulated for the termination of the business, we nevertheless offered to do everything possible to bring about the arrangement within the following four months.

With all the interest that the matter calls for and with special instructions from the President of the Republic, I proceed to answer your excellency with reference also to that expressed by the Secretary of State.

The agreement at Bluefields accepted by my Government it does not believe it just to fail in complying strictly, and if before now it had not begun the respective judicial action it has only been because the judge of that city had not been able to take possession of his post since the rebellion. By this date it is certain that the question has been placed before his authority and by whom it corresponds. It is there, then, that the merchants interested may present the proofs that excuse them from the unwarranted payments that were made to the revolutionary agents of General Reyes.

I respectfully call to the remembrance of your excellency that the question was remitted in the first place to the knowledge of the authorities before whom it might correspond, and it could be no other than the judiciary of Bluefields, with the power to carry it in last resort to the attention of the respective chancellorships.

Now, if none of these appeals has been carried out, how is it possible that the Government of Nicaragua may order the return of the deposit only because the American Government, on studying the matter, has thought to find justifiable motives in the acts of the Bluefields merchants.

The solicitude of the Secretary of State regarding the return I find very premature since the matter has not been ventilated, and besides with little foundation, because the attested proofs of the interested parties can not be admitted as the only source of investigation.

The idea of a discussion in this respect does not enter to-day into my proposition, nor much less regarding the culpability the Americans may have incurred that aided the revolt of General Reyes, a circumstance that the Government of Nicaragua has desired to forget in order not to give the matter greater proportions and as a friendly act toward the United States of North America, but I will not abstain from making some reflections upon the note that the Secretary of State of that country directed to your excellency and to which I come, referring—

The neutrality of the merchants far from being demonstrated is inferred from the active participation of their principal clerks and by the gifts which they made to the column organized under the denomination of rough riders, besides the public testimony of all those who witnessed the events.
If it is true that no new entries of goods were made during the time of the insurrection they nevertheless paid the duties that they owed to a rebel agent, notwithstanding [Page 807] that their consuls proclaimed the principle of neutrality and the revolutionists exercised on them no acts of violence. There is more—some paid and others did not, without these last being compelled to pay by force the payment refused, and even upon those who afterwards did not care to pay further dues no violence was enacted.
The fact that Mr. A. Salter, who had been before collector of revenue for the legitimate Government, was he who made the collection, can not be an excuse since everybody knew that this gentleman had become revolutionary agent no longer obeyed the Government of Nicaragua, and the fine of 5 per cent to which they refer could not be a motive of compulsion, since they were not threatened with force.
With regard to General Reyes being he who commanded absolutely in the department of Zelaya between the 2d and 23d of February last because Gen. Aurelio Estrada, named successor, could not take possession of the post, and even took refuge in the American consulate—that is no argument that excuses the payment of duties due to the custom-house because the rule of Mr. Reyes was illegal, not sanctioned by any law of right or recognized by any other foreign power. The very captains of the American and English war vessels were the first in denying the character of a de facto government.

Outside of all the considerations that I have laid down, and which I do not doubt will be duly appreciated by your excellency, permit me to call your attention to an important point of the question.

Your excellency well knows that not only American citizens have been included in the lists of the reluctants, but also English and Germans. The British subjects paid without resistance or protest, among them the vice-consul, Mr. T. A. Bellanger, doubtless because they recognized the justice of the Government’s claim or through express reproof from their superiors for their acts in helping in this way General Reyes.

If to-day the Government of Nicaragua, after having made a solemn agreement in which is concerned the honor of the nation, should order the return of those deposits without the previous given judgment and without having discussed the matter in the last resort on diplomatic grounds, it would be a reason for the other foreign subjects to claim in their favor an equal prerogative.

After all the foregoing, and by reason of the change in the person of the first of the Government employees on that coast who has been substituted by an old magistrate of the supreme court, I believe that the question will soon be ended and according to the high ruling of the law.

For the rest the Government of Nicaragua holds the conviction that the Government of the United States will be willing to see in this determination, not a mere capricious resistance to its demands, but a strict fulfillment of its duty and the best public advantages, without through this lessening its high conception that the opinions of that illustrious Government merit.

I repeat, etc.,

J. Sanson.
[Inclosure 3.]

Mr. Merry to Mr. Sanson.

Sir: I have the honor to acknowledge the receipt of your No. 579, dated August 25, in reply to my No. 70, of August 14, inclosing dispatch from my Government in relation to the funds now held subject to the joint action of our respective Governments by the British consul at San Juan del Norte. It is proper that I should hesitate to again discuss this question which occupied so much of your excellency’s attention and mine at Bluefields. There is little that I can add to the arguments I then presented verbally, and, as the matter was then referred by us to the Governments at Managua and Washington, I do not feel at liberty to commence a discussion “de novo.” But, inasmuch as I am jointly responsible for the agreement, I feel at liberty to discuss my action in accepting it in order, as I hoped, to settle a disagreeable contention, which at one time threatened to create serious difficulty.

First, permit me to express my surprise that your excellency deems the action of the honorable Secretary of State at Washington “very premature.” His dispatch, which I inclosed to you with mine of August 14, was dated July 26, nearly three [Page 808] months after we had signed a joint agreement, dated April 29, requesting our respective Governments to “the end that it maybe decided within four months.” I do not think it possible that your excellency will, upon mature consideration, deem his action premature, and that a written agreement making a specified promise has no value. To comply with the agreement it is obvious that the subject was by no means taken up prematurely. The section of the agreement which you rely upon to delay action reads as follows:

“3. The difficulty overcome, once that it has been discussed by whom it may appertain and, as a last resort, by the secretary of foreign relations of Nicaragua and the Department of State of the United States, the deposit shall be paid,” etc. This clause, as all the others, received my careful attention, and I found no fault therewith then, any more than to-day. Its terms are plainly an admission that the question could be further discussed before being submitted to the respective Governments, limited by the language in clause 5 conveying the request for a settlement within four months. I accepted it for the special reason that a friendly settlement appeared possible between General Estrada and the merchants after Colonel Torres had completed his court-martial, your excellency having, as you must recollect, assured me that he would leave Bluefields for Managua on May 10, six days after our departure, although he remained there until May 24. Your excellency is well aware that a second submission to a court was never mentioned verbally and no such idea is expressed or understood in the agreement. In fact, the agreement withdrew the case from Colonel Torres’s “court-martial;” why, then, should it even indirectly stipulate to refer it to another court? Who are the parties to “whom it may appertain,” as specified in clause 3 quoted above? Obviously and necessarily the Nicaraguan Government, the Bluefield merchants, and the United States Government as an intervener. The Nicaraguan executive Government, through a coordinate branch, exercises its right to investigate the question, obtaining all valid information possible before presenting the matter to the Washington Government. It has already, through an executive delegate, held a prolonged “court-martial” with closed doors for this purpose. That the United States Government shall submit itself to the decision of a Nicaraguan court not named in the agreement is a proposition so indefensible that it does not merit discussion.

Having, under the agreement with your excellency, referred the matter to my Government after prolonged verbal discussion with yourself, I deem it proper to leave the case in the hands of my superiors, and shall only further briefly allude to the gist of the whole question. Your excellency has repeatedly asserted that the Reyes government was not at any time a government “de facto.” I contend that between February 3 and 25 it was a “de facto” government and the only effective government at Bluefields; there was most positively no other. True, it was revolutionary in character, and established “protern.” by the faithlessness of your highest official on the Atlantic coast. During the period stated it had absolute and uncontested possession of the port and city of Bluefields, of the Government treasury, arms and war munitions, post-office, custom-house, police force, army, gunboat, executive mansion, and all public buildings. It exercised all governmental functions and even obliged your highest officer to obtain asylum in the United States consular office. These facts you do not contest, and they fully prove beyond question the “de facto” character of the Reyes government during the period above stated. The consular proclamations of neutrality have not the slightest bearing upon the case, the neutrality of foreigners being a duty in all cases of local political and military conflict. The action of the commanders of the English and American war vessels was also a proof of the existing of a “de facto” government, under the revolutionary leader Reyes, since those officers found no other existent government with which they could deal, in aiding the security of life and property, the return of peace and restoration of the Nicaraguan Government, enabling your highest officer to leave his asylum and assume his official duties, after three weeks. It was, I am free to admit, a revolutionary government, successful in maintaing its authority for about three weeks only, but its “de facto” character during that period, especially in its relations to foreign residents, can not be successfully refuted.

I am pleased to be informed by your excellency of the appointment of Gen. Tiburcio Bonilla as governor of the department of Zelaya. The gentleman is known to me as bearing the reputation of being just, honest, patriotic, and able. This I may state without detracting from the merits of his predecessor.

A copy of this correspondence goes forward to the Government at Washington by mail of 9th instant.

With assurance, etc.,

William Lawrence Merry,
United States Minister.