Mr. Hay to Mr. Clayton.

No. 605.]

Sir: I have to acknowledge the receipt of your dispatch No. 1181 of the 13th ultimo, reporting a conversation that you had on the 8th ultimo with Mr. Mariscal in relation to the claim of the Roman Catholic Church of California against Mexico growing out of the Pious fund of the Californias.

Your action in the matter is approved by the Department.

The stipulations or terms of the arbitration agreement, as well as the name or names of the arbitrator or arbitrators to be appointed, should be submitted to the Department for approval in advance.

The Department notes with pleasure the reported conversation with Mr. Mariscal and that his suggestions to you are in line with the wish expressed in the Department’s previous instruction.

I am, sir, etc.,

John Hay.