File No. 417.00/89.

The Secretary of State to the American Chargé d’Affaires.


The Department is not disposed to counsel the Nicaraguan Government to resist demands of European countries through diplomatic channels for the direct settlement of their claims; but if the Nicaraguan Government of its own initiative should decide that European claimants must first exhaust the remedies afforded by the Nicaraguan courts or other local tribunals, including the claims commission, the Department believes that international law and practice furnish ample precedents therefor.

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You will have in mind that if the British claims are paid, and if direct settlement is made of the other European claims, preferential treatment over American claims will thereby be given them, since this Government has consented, because of its friendly feeling toward Nicaragua, to the presentation of American claims in the first instance to the claims commission.