File 417.00/42.

The Secretary of State to the American Minister.


The Department, having very carefully considered the wording of the decree establishing the claims commission, is convinced that certain modifications should be made therein. The department in this connection desires to inspect the Spanish text of proposed amendments, numbered to correspond with the articles which they are designed to amend. Following are the modifications proposed:

The preamble changed to read:

The President of the Republic, having conferred with the Government of the United States as to the best mode of affording a just and equitable solution, etc.

Article 1 should have this addition:

Article 1. * * * The claims referred to in this article are all those claims which from any cause whatsoever may arise or may have arisen against the Government of Nicaragua from the beginning of the administration of President Zelaya until the commission closes its work, including claims which may arise out of the belligerent operations of either faction during the recent civil war. To facilitate the better examination of these claims, the commisson is empowered to meet in its discretion in places other than Managua, and it shall give due and appropriate notice of such meetings to the parties interested. The commission shall in its consideration of claims give precedence to claims arising out of military loans, requisitions, or exactions by either faction during the recent civil war.

To article 2 there should be added:

Article 2. * * * The commissioner appointed by the Department of State shall act as president of the tribunal, and no meeting at which he or [Page 634] his duly appointed successor is not present shall be held. All vacancies arising from whatever cause shall be filled within 30 days from the beginning of such vacancies in the same manner in which the original appointment was made.

Article 3, as follows:

Article 3. All matters coming before the tribunal shall be decided by a majority vote. If any member of the commission is persistently absent without just cause, or for any reason is incapacitated for the performance of his duties, the attending members shall notify the Government of Nicaragua, which shall thereupon declare the commissionership vacant, which vacancy shall immediately thereupon be filled as provided in article 2. The commission is empowered to employ the clerical force necessary for the conduct of its work, which clerical force shall be compensated by the Nicaraguan Government.

To Article 4 should be added:

Article 4. * * * No rule or regulation shall be put into effect until the president of the commission shall have recorded his opinion thereon.

To article 5 should be added:

Article 5. * * * Provided, however, That the right to question the cancellation or annulment of concessions, and the right to indemnify, shall not be forfeited and the forfeiture of rights and remedies with reference thereto shall in no case be declared by the tribunal except upon proof satisfactory to the tribunal that, six months prior to the motion for such judgment, the Government of Nicaragua gave in appropriate form express notice to the parties concerned of the intention of the Government to move for such judgment against them, and except it appears that said parties have failed to appear before the tribunal for such time, no valid excuse for such failure to appear being shown.

To article 6 should be added:

Article 6. * * * Provided, That no contract or concession contemplated in articles 1, 5, or 6 shall be canceled or annulled except upon the ground that such contract or concession is illegal or unconstitutional, and that no decree of cancellation or annulment shall take effect until affirmed by the commission after an opportunity for a full hearing has been given to the parties in interest and until such damages, if any, as may by the commission be found due to the concessionaires from the Government of Nicaragua shall have been paid: And provided further, That no cancellation or annulment heretofore decreed by the present Nicaraguan Government shall take effect until a like determination by the commission and payment of damages, if any, by the Government. Where, by reason of special equipment or experience or for any other sufficient reason, the parties from whom the concession or contract is taken are better able to carry on the legally proper part of such concession or contract than a new concessionaire, such parties if responsible shall be given preference as to any new grant touching the same matter, which new grant shall be conferred in as liberal terms as may be consistent with the law and the national welfare.

Article 14 should be amended as follows:

Article 14. The six-months period above mentioned shall begin to run from the date on which the actual notice of the annulment or cancellation of the concession is given to the concessionaire or contractor, provided that in no case shall such six-month period be held to expire at a date earlier than six months from the date on which the tribunal formally begins its regular sessions for the determination and adjudication of claims; and provided that as to all other claims the period shall begin to run from the date on which the tribunal formally begins its regular sessions for the determination and adjudication of claims, which date shall be notified by proper publication in the official gazette for a period of 30 days beginning 15 days before said date of opening and continuing for 15 days after said date of opening.

An additional article 15 containing the following stipulations should be added in words to the following effect: The Government of Nicaragua shall accept the decision of the tribunal as final and [Page 635] binding adjudications of the claims passed upon by the tribunal, and undertakes to pay all awards made by said tribunal against the Government.