File No. 419.11D29/102.
The Secretary of State to the Minister of the Netherlands.
Washington , August 19, 1915 .
Sir: On July 4, 1912, during the progress of disturbances which took place in the so-called Cocoa Grove District in the City of Panama, two American citizens lost their lives and about sixteen other American citizens received injuries of a more or less serious character.
After much diplomatic correspondence between the Governments of the United States and Panama respecting the responsibility for the disturbances mentioned, on April 26, 1915, the following proposal was transmitted from the Panaman Foreign Office to the American Minister to Panama for submission to the Secretary of State:
That one of the diplomatic agents of one of the friendly nations accredited in Panama, chosen freely by the Government of your excellency, shall be constituted and shall decide the amount of the indemnity which Panama should pay for each one of the murdered citizens and for each one of those who suffered wounds in the riot of July 4, 1912. If the Government of your excellency accepts the formula of settlement, which is equitable, it could be put in writing and the respective arbitral agreement signed binding the parties to respect and fulfill the decision which may be rendered.
The Department endeavored to make a direct settlement with the Panaman Government of the matter of the indemnity mentioned in that proposal but such effort failed, and thereupon, on August 7, 1915, the Department telegraphed the Minister to Panama to propose to the Foreign Office that your excellency constitute the arbiter in this case. A reply has been received from Mr. Price under date of [Page 1180] August 13, 1915, in which it is stated that the Panaman Minister for Foreign Affairs, by formal note, has agreed to your selection by this Government.
Accordingly the Department desires to express its earnest hope that you may find it possible to act in this capacity, and would be very much gratified to learn of your willingness so to do.
It may be said in this connection, that the only question which the arbiter will be called upon to determine will be the amount of the indemnity to be paid, and it is expected that arrangements can be entered into by which the evidence which the arbiter will be called upon to consider will consist solely of written documents, so that the demands which will be made upon the time of the arbiter would be reduced to a minimum.