Mr. White to Mr. Hay.

No. 1021.]

Sir: Referring to my dispatch No. 1020 of the 3d instant, I have the honor to inform you that having ascertained yesterday that Lord [Page 467] Lansdowne would like to see me late in the afternoon I called upon him at the foreign office at half-past 6, when he handed me a note, which I have already cabled you in full, containing the reply of His Majesty’s Government to the communication which I addressed to his lordship on the 1st instant. A copy of this note is inclosed herewith.

I have, etc.,

Henry White.
[Inclosure.]

Lord Lansdowne to Mr. White.

Sir: I have the honor to inform you, in reply to your communication of the 1st instant, that His Majesty’s Government have taken into consideration the answer received by Mr. Secretary Hay from the President of the Venezuelan Republic to the proposals contained in the memorandum which, on behalf of His Majesty’s Government, I handed to you on the 23d of December.

His Majesty’s Government observe with satisfaction President Castro’s statement that he recognizes “in principle” the claims which they have put forward. His Majesty’s Government understand this statement to signify that President Castro agrees, on the part of the Venezuelan Government, that any discussions in which Mr. Bowen, as the representative of that Government, is to engage at Washington with the representative of His Majesty’s Government, are to proceed upon the assumption that the Venezuelan Government unreservedly accept and agree to be bound by the conditions laid down in the memorandum of December 23, which run as follows:

  • “1. The claims (small, as has already been pointed out, in pecuniary amount) arising out of the seizure and plundering of British vessels and outrages on their crews, and the maltreatment and false imprisonment of British subjects are not to be referred to arbitration.
  • “2. In cases where the claim is for injury to or wrongful seizure of property the questions which the arbitrators will have to decide will only be, (a) whether the injury took place, and whether the seizure was wrongful, and (b) if so, what amount of compensation is due. That in such cases a liability exists must be admitted in principle.
  • “3. In the case of claims other than the above we are ready to accept arbitration without any reserve.

“It would, in the opinion of both governments,” (British and German) “be necessary that the arbitral tribunal should not only determine the amount of compensation payable by Venezuela, but should also define the security to be given by the Venezuelan Government, and the means to be resorted to for the purpose of guaranteeing a sufficient and punctual discharge of the obligation.”

On receiving a definite assurance from President Castro that this intrepretation of his language is accepted by him as correct and that, whatever procedure be adopted, adequate provision will be made for the prompt satisfaction of the claims specified in paragraph 1, His Majesty’s Government will be prepared to authorize His Majesty’s ambassador at Washington to confer on this basis with Mr. Bowen, as the representative of the Venezuelan Government, and will furnish Sir M. Herbert with the necessary instructions for examining the possibility of an immediate settlement, or, failing such a settlement, for arranging a reference of all points left open for arbitration to the tribunal at The Hague.

His Majesty’s Government will be much obliged if Mr. Secretary Hay will be good enough to take such steps as may be necessary to communicate the substance of this memorandum to President, Castro and will request an answer at the President’s earliest convenience.

I have, etc.,

Lansdowne.