Mr. Buck to Mr. Hay.
Tokyo, Japan, December 14, 1900.
Sir: Referring to my dispatches of December 24 last, of April 7 last, and of July 6 last, Nos. 392, 417, and 450 respectively, concerning the various questions which have arisen as to registration and taxation of property held under leases in perpetuity in the former foreign settlements by American citizens in Japan, as also of the buildings erected thereon, I have the honor to invite attention to imperial ordinance No. 458, accompanying my dispatch No. 392, and especially to that paragraph of Article I which reads as follows:
If a right in an immovable other than that mentioned under paragraph 1, which might be set up against third persons, has been duly acquired by an alien or a foreign juridical person before the time fixed in imperial ordinance No. 251 of the thirty-second year of Meiji (viz, the time of the operation of the new treaties), but has not been registered before that time, it can not be set up against third persons unless it is registered before the 31st of December, 1900.
Also to the inclosed copy of a note from the Japanese minister for foreign affairs, of date the 10th instant, addressed to the British minister [Page 340]in answer to formal representations made by the British chargé d’affaires ad interim, and furnished me as a reply also to similar representations informally made by me upon the same subject.
In view of my interpretation of the above-transcribed paragraph, and in view of the fact that doubt on the part of the property holders whether they should be required to pay the 2½ per cent registration fee on registration of buildings, few if any registrations of buildings were being made; and the time being short in which compliance with the ordinance respecting registration would afford protection to property rights, I was on the point, October 1, of preparing a note to the minister for foreign affairs asking an extension of time for registration beyond December 31 of this year, when, incidentally discussing the subject at the foreign office, I was informed than an extension of six months was to be granted in which to perfect registration. Hence I made no formal request.
It now appears from the answer of the minister for foreign affairs that it has been discovered that no right of registration is to be lost and no property right is to be jeopardized in consequence of failure to register property on or before the 31st instant, and that no necessity exists for the extension of the time for registration as provided in ordinance No. 458. The reasoning seems to be somewhat involved and I am not entirely convinced that the conclusion reached is not a questionable one. While the Japanese Government’s own interpretation of their ordinances is supposed to govern, it is difficult in this instance to reconcile the text of the paragraph of ordinance 458 in question with the interpretation given by the minister for foreign affairs, and it remains to be seen whether the Japanese courts will give effect to the views of the Japanese Government as expressed in his excellency’s note.
In this connection I am glad to be able to say that I am informed at the foreign office that a bill will be introduced and doubtless passed by the diet very soon to be convened providing for the registration of perpetual leases as such, leaving out the word “superficies,” as now provided for by ordinance No. 458, and thus eliminating any question as to change of form or character of leases in perpetuity by registration.
This, I understand, could have been done by ordinance No. 458, and would now be done by ordinance but for the reason that there is no authority to change a law by ordinance. Perpetual leases not being known to the law, the ordinance could only couple the term “superficies “with “perpetual lease,” the latter in brackets, which at the time was supposed to give recognition of such leases and protection of all rights otherwise guaranteed by treaty, but which has not proved satisfactory to leaseholders.
I understand that the proposed bill is also to provide for registration of buildings constructed prior to the date of the operation of the new treaties on property held under perpetual leases and not since transferred without payment of the 2½ per cent on value now chargeable under the registration law. This will afford great relief, as heretofore registration of such leases at the consulate made no reference to buildings, since under foreign jurisdiction the buildings were supposed to be included with the land in any transfer without special mention, while by Japanese law they are not so included as a matter of course, and buildings must be registered separately.
I have, etc.,