Office of the Historian

File No. 422.11G93/822.

The Secretary of State to Minister Hartman.

[Telegram.]
Department of State, November 19, 1915—6 p.m.

Referring to the memorandum transmitted in your number 130 of August 19, wherein President Plaza agreed to set aside sufficient of loan proceeds to pay all outstanding indebtedness to bondholders, refused to settle claims of the railway company, asked the Department to hear Ecuador’s case against the railway from the Ecuadorian representative here with a view to reorganization of the railway administration, and requested the support of this Government in the negotiations for a loan of ten million dollars, you may inform the President that the Department is willing to lend its assistance so far as it can properly do so in obtaining a loan, provided,

First: that daily payments be immediately resumed for the service of the bonds, the stoppage of which payments have been solely due to the application of pledged customs revenues to other purposes; and

Second: that the Government of Ecuador, in view of the statement of President Plaza that he would be satisfied with the judgment of Ecuador’s cause by an American functionary, engage itself to designate such official, with the approval of the United States Government, for the purpose of examining into the rightfulness of Ecuador’s claims against the railway and the company’s claims against Ecuador, and of rendering a final decision, it being understood that the functionary shall not question the settlement under the transaction contract incorporated in the arbitral award of 1908.

As regards the President’s request for a hearing for Minister Córdova, the Department offered to give the Minister an opportunity for full and frank discussion of this matter in its note to him of July 30 last. The Minister has made no mention of the matter since that time. As regards reorganization of the administration of the railway, this question might be considered after the functionary has rendered a decision.

You will promptly take up the foregoing with President Plaza and endeavor to obtain his formal acceptance of these stipulations.

Lansing.