Mr. Combs to Mr. Hay.

No. 131.]

Sir: I have the honor to inclose herewith a copy with translation appended of the decree No. 639 issued by the President of Guatemala in regard to the relative values of the national currency.

It excited much discussion and uneasiness. A number of Americans called upon me requesting that I join the other diplomatic representatives here in a remonstrance to the Government.

Friday afternoon, on the 8th instant, Mr. Thornton, the British minister, called and asked me to join him in representations to this Government.

I stated to our citizens and to Mr. Thornton I thought present action premature; that this Government had the unquestionable right to regulate the relations its own circulating mediums should bear to each other; that there was nothing on the face of the decree to which we had a right to object, no difference what opinion might be of the wisdom of the proposed course.

Upon reflection, however, I called upon the minister for foreign affairs Saturday the 9th instant and told him of the existing uneasiness. I further stated the interpretation I had put upon the decree, but that I felt unwilling, in view of existing opinion, to sustain the responsibility of such interpretation unless it was corroborated by the Government. He promised to consult the author of the decree and sent for me this Monday morning to assure me the intention of the decree was exactly what I had thought and an elucidation would be given semiofficially through the press at once.

In order to definitely confirm these interviews with the minister for foreign affairs to place on official record the substance of same, I addressed to him a note, copy of which is herewith inclosed, summarizing my understanding of his expression on the part of his Government as to its intentions in reference to the decree referred to.

I have, etc.,

Leslie Combs.
[Page 347]

Decree published in the “Guatemalteco” (official organ) on Thursday, January 7, 1904.

Decree No. 639.

Manuel Estrada Cabrera, constitutional President of the Republic of Guatemala.

Whereas in conformity with decree No. 595, of June 9, 1899, it was ordered, for the public good, that bank and “Comite Bancario” notes should be valued at par with the national silver coin;

That, notwithstanding the clearness of said decree, it has not been faithfully and correctly interpreted, there often occurring doubts and vacillations which it is necessary to do away with, especially in connection with settlements effected by the courts when suit is brought for the payment of any obligation in gold:

Therefore, by virtue of the power vested in me by the National Legislative Assembly, I decree:

  • Art. 1. When any sum in gold is demanded judicially the debtors can cancel their credits in silver or bank notes, or of the Comite Bancario, as provided for in the decree already cited, and at the exchange that gold has in relation to silver.
  • Art. 2. The exchange may be either that fixed upon by experts, or the current rate at the banks.
  • Art. 3. This decree becomes effective from the date of its publication.

Manuel Estrada C.

The secretary of state, interior, and justice:

Juan J. Argueta.
[Inclosure 2.]

Mr. Combs to Señor Barrios.

Excellency: Since I was not accompanied by an official interpreter, I have the honor to submit to your excellency, in way of confirmation, the substance of the two very satisfactory interviews which I had with your excellency on Saturday last and yesterday with reference to the decree No. 639.

On Saturday I stated to your excellency I had called to ask to be informed of the exact purpose of the decree. I added it had caused me no alarm, as it seemed to be a regulation of the legal tender value of the different Guatemalan mediums of exchange, a procedure entirely within governmental rights; but as some were disposed to put a dangerous interpretation upon its terms, I desired full information before transmission to my Government. Your excellency kindly promised to ascertain the exact meaning of the decree and on Monday informed me I had only done justice to the Government in my interpretation of its purpose; that it was simply intended to regulate the legal tender value of Guatemalan gold and that it in no way affected the settlement of contracts or obligations where the medium of liquidation was stated in explicit terms as American gold, whether such settlement was voluntary or by judicial decree; that the latter contracts and obligations, as formerly, must be paid in the medium declared on their face.

With renewed, etc.,

Leslie Combs.