File No. 422.11G93/829.

Minister Hartman to the Secretary of State.

No. 153.]

Sir: Referring to the Department’s instruction No. 83 dated October 23, 1915, I have the honor to report:

In compliance with said instruction, I presented the protest in my note No. 162 dated November 24, 1915, addressed to the Minister for Foreign Affairs, but have not yet received a reply. Upon receipt of the reply I will report both its contents and the contents of my note of protest above mentioned.

In further compliance with said instructions, I enclose herewith copies of my note No. 130 of May 8, 1915, to the Minister for Foreign Affairs, together with copies and translation of his reply thereto, of which last-named document I telegraphed the substance to the Department in my telegram of May 19, 4 p.m. I would have reported fully by mail the contents of my protest as well as the reply of the Minister for Foreign Affairs, but in the meantime the identical question raised by the Minister for Foreign Affairs in his note above referred to had been presented again in his note of May 14, to which I referred in my No. 118 dated June 4, 1915. It therefore did not seem to me essential to make the report when the only effect could be to make a double presentation of the same question to the Department.

I have [etc.]

Charles S. Hartman.
[Inclosure 1.]

Minister Hartman to the Minister for Foreign Affairs.

No. 130.]

Mr. Minister: In compliance with an instruction of my Government I have the honor respectfully to bring to the attention of your excellency the substance of a communication addressed to the Department of State by the Guayaquil & Quito Railway Company.

That communication states that the Company is informed that the “Chief Executive has been authorized to apply as much as forty per cent of all the Government income to the payment of debts in current accounts with the banks of the country, and to use for the same purpose up to sixty per cent of the funds provided for public credit and public works,” and that such a disbursement of the Government’s income could not be carried out without infringing upon the contractual duties which the Government has with the Guayaquil & Quito Railway Company.

While of course my Government assumes that your excellency’s Government does not contemplate any use of the revenues of the country which will infringe the guaranty given the Railway Company, and brings the matter to the attention of your excellency only in a precautionary sense, yet it expresses the hope that it may receive at an early opportunity a definite reply from your excellency’s Government, both on the point raised in this note and the one raised in my note No. 66 of May 16, 1914.

I avail [etc.]

Chas. S. Hartman.
[Page 369]
[Inclosure 2—Translation.]

The Minister for Foreign Affairs to Minister Hartman.

No. 93.]

Mr. Minister: I have the honor to acknowledge receipt of your excellency’s note of the 8th instant, in which you call my attention to the substance of a communication addressed to the Department of State by the Guayaquil & Quito Railway Company.

In reply I have the honor to say to your excellency the same that I expressed to you in my note No. 192 of June 22, 1914, in which I gave, in my opinion, a definite answer to that of your excellency No. 66 of May 16 of the same year.

My Government regards acceptance of the intervention of any Power in a matter in which diplomatic action has no legal place as incompatible with the sovereignty of Ecuador and with its status as a free and independent nation.

This excuses me from going into the details to which your excellency refers in the note under acknowledgment.

The railway company is free to deal directly with our Ministry of Public Works and to lay before it the claims that it considers justified by the plans and acts of my Government. That Ministry is the only avenue by which foreign companies, such as the Guayaquil & Quito Railway Company, may approach my Government when, as in the present case, its claims are not based on denial of justice.

Permit me to reiterate to your excellency the language of my note of June 22 last where I say that, considering the spirit of justice that inspires your excellency’s Government, and the Panamerican idea of cordial and intimate relations which has been present always, and of late especially, in the relations between Ecuador and the United States, my Government hopes that the Government of your excellency will not find in these questions matter for diplomatic intervention.

The honesty and patriotism on which the leading men of a country necessarily desire to base their administrative acts are antecedents which must not be ignored in examining an accusation, even without giving it full credence but entertaining it only in a precautionary way.

It is to be supposed that in the present case my Government has no thought of impairing obligations already established but, rather, proposes to favor them directly or indirectly. The railway company has not an atom more interest than the Government of Ecuador in the faithful fulfillment of the contract between them, even in the part of it which contains obligations imposed on the Government alone; and the insistence of the Company on seeking shelter in diplomatic action is certainly neither the most upright nor the most appropriate way of settling the pending difficulties.

I avail [etc.]

R. H. Elizalde.