Papers Relating to the Foreign Relations of the United States, With the Annual Message of the President Transmitted to Congress December 3, 1912

File No. 882.51/507.

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

No. 67.]

American Legation,
Monrovia, December 9, 1912.

Sir: At the request of the General Receiver of Customs for Liberia, Mr. Reed Paige Clark, I have the honor to transmit herewith for the information of the Department a report by him with reference to an issue which has arisen in the Receivership.

It will appear from the inclosed documents that the three Receivers have unanimously denied the right of the General Receiver to assign them to their respective locations. I do not think it necessary to enlarge upon the report of the General Receiver, as it gives a clear record of the case, except to say, in my opinion, that the relation which the German and British Receivers have borne to Liberian affairs accounts in a large degree for their attitude in the present controversy.

Mr. Sharps, the British Receiver, suffers a reduction under the new regime and is naturally reluctant to give up to the General Receiver power that he was wont to exercise without hindrance. His experience makes him a valuable man to the Receivership, but he approaches his new duties in a manner which creates the impression that it is possible that he can never adjust himself to the new order, and should the General Receiver be sustained in the position he has taken I believe that he will resign as soon as he can arrange to do so without a too great personal sacrifice.

Of Mr. Lange, the German Receiver, I think It may be said, from what I have ascertained, that he attaches an exaggerated political and representative significance to his position as Receiver, and he apparently feels that to be subject to the direction of the American General Receiver is beneath his dignity as the agent of the Government he represents. Having been the German Consular Officer in Liberia for a considerable time, he seems to be movable to divest himself of certain attributes of has former representative character. Mr. Lange, like Mr. Sharpe, will therefore find it difficult to adjust himself to the authority of the General Receiver, guaranteed by the loan agreement, if he, the General Receiver, is finally sustained in the stand he has taken. It is not at all improbable that Mr. Lange under such circumstances would also resign.

Mr. Wolf, the French Receiver, I believe would, if left to himself, never have raised the issue and quite likely will remain in the Receivership should the point go against the Receivers. The amount of divergence between the interpretation of the General Receiver and the Receivers as to the meaning of the loan agreement gives one the feeling that its spirit and purport is thoroughly misunderstood or purposely misconstrued by tile Receivers. Whether or not a working basis can be reached with the present personnel is extremely doubtful. In my opinion, the General Receiver would gain immensely in power and prestige if the resignations foreshadowed actually take place.

I am [etc.]

Richard C. Bundy.

[Inclosure.]

The General Receiver to the Secretary of State.

Customs Receivership of the Republic of Liberia,
Monrovia, December 7, 1912.

Sir: I have the honor to inclose herewith extracts from the approved minutes of the meetings of the Liberian Customs Receivership held on December 3, 4, 5, 1912.¹ In order that the Department may come to a clear understanding of the issue, I am also taking the liberty of submitting a brief report thereon.

On December 3d, Mr. Sharpe, who, in common with Mr. Wolf, the French Receiver, is extremely anxious to know whether the General Receiver will keep the promise to locate the German Receiver at Monrovia (both the British and French Receivers are well aware of the promise) suggested that the Receivership proceed to discuss the location of Receivers. I objected strongly to the form in which the suggestion was made, holding that the Receivership, as such, had nothing to do with the location of Receivers, inasmuch as the Receivers were acting under the direction of the General Receiver.

At first Mr. Lange took no active part in the discussion, but Mr. Sharpe speedily and very cleverly enlisted his sympathy by obscuring the real point in question and enlarging upon the fact that the General Receiver, to put it baldly, was claiming the right to issue orders to the Receivers. The word “orders” seems to have been especially nauseous to Mr. Lange; but, even 30, his action in aligning himself against the General Receiver on the present issue is, to say the least, astonishing. Surely he must know that the promise above referred to is not that the American Government will cause the General Receiver to vote for the location of the German Receiver at Monrovia, but will cause the General Receiver to locate him there. By taking issue with the General Receiver on the question of his authority in this particular, Mr. Lange, I believe, is treading upon exceedingly dangerous ground—for him.

Personally, I may say in passing I should welcome an opportunity to escape honorably from this embarrassing promise affecting the location of the German Receiver. It has occasioned, and is destined to occasion, the major part of our difficulties in the Receivership. The British and French Receivers are convinced of the existence of a working agreement between the General Receiver and the German Receiver, and will seize upon any pretext to declare that the General Receiver is showing favor to their German colleague.

To my mind, the question as to the authority of the General Receiver to designate the location of Receivers admits of no argument. The meaning of the phrase in article 4 (a), paragraph 3, of the Loan Agreement is, I believe, unmistakable. Article 7 implies clearly that there are questions that do not require a Receivership vote.² From the first there has been a tendency among the Receivers toward independence of action. This tendency, I respectfully submit, must be checked, for a body like the Receivership can have but one responsible head; it would lead to endless confusion, for example, if the Receivers were permitted to issue, in their own names, orders affecting Receivership matters generally, even though acting in behalf of the Receivership.

In our discussions we have mutually agreed that the word “construe” is used in the legal sense of “finally determine the meaning of.” It is obvious that it is not within the province of the Receivership to construe the Loan Agreement. As will appear from a perusal of the minutes, I have prevented the Receivership from voting upon any question involving the construction of that instrument, more especially upon any question relating to the prerogatives of the General Receiver. The Receivers are clearly entitled to a voice in shaping the policy of the Receivership, but, quite as clearly, they have no control over the designation of individuals to carry out that policy.

Mr. Sharpens questions and motions were carefully prepared in advance, while my rulings were necessarily in the main extemporaneous. The Department can judge whether or not my course in shutting off debate and forcing the Receivers to take their arguments elsewhere was justifiable under the circumstances. A vital principle is involved in the controversy, and the sooner it is conclusively settled the sooner the Receivership can proceed in an orderly manner.

In arguing his motions Mr. Sharpe had but little assistance from Mr. Wolf, who has some difficulty in following English when rapidly spoken, and but little from Mr. Lange, who, I fear, has never had a very clear idea of the true meaning of the proceeding. Mr. Sharpe has since confessed to me that he desires not so much a settlement of the question as to the General Receiver’s authority in the premises as a record of the attitude of the General Receiver and of each Receiver in the matter of location. I am willing enough to have myself and Mr. Lange on record, but I can not waive a prerogative of the General Receiver to accomplish this result. If his authority in this respect is recognized by the Receivers, the General Receiver will make the designations, in which event, of course, the responsibility will be entirely his. I hope for an early settlement of the question.

The Department’s cablegram of December 4 was a source of considerable gratification to me. If I hear nothing further from the Department, I shall proceed to make designations whenever, in my opinion, the time is ripe.

I am [etc.]

Reed Paige Clark.

1. Not printed.
2. The passage of Article Fourth referred to reads as follows: “By the terms of such arrangement, in order to assure the faithful and efficient administration and collection of the Assigned Revenues and their application in accordance with this Agreement, the Customs Receivership shall be administered by a General Receiver so designated, and three Receivers so designated who shall act under the direction of the General Receiver.” Article Seventh reads as follows: “Any question herein required to be passed upon jointly by the General Receiver and Receivers may, pending such joint action, be provisionally decided by the General Receiver, and such provisional decisions shall be of full force and effect unless and until finally disposed of by such joint action. The General Receiver and Receivers shall meet at least once a year, before the convening of the Legislature, or may hold special meetings upon the call of the General Receiver or upon the unanimous request of the Receivers, for the purpose of considering and finally determining such questions requiring their joint action. At such meetings the General Receiver and Receivers shall each have one vote and all questions requiring their joint action shall be decided by a majority of the votes of those present and voting, and in case the votes shall be equally divided the vote of the General Receiver shall be final and conclusive.”