File No. 838.516/66.

Minister Blanchard to the Secretary of State.

No. 28]

Sir: I have the honor to report that in pursuance of the complaint embodied in a letter from the Director of the National Bank of the Republic of Haiti, under date of December 29, 1914, and after conference with the French Minister here, who took a similar course in the defense of the French interests in the Bank, the Legation, pending further instruction, addressed a note to the Foreign Office, dated December 30, 1914, of which a copy is herewith forwarded, making the most express reserves as to the action of the Haitian authorities in executing the decree, rendered by default and in violation of Article 24 of the contract of the Bank, which prescribes that all differences between the Haitian Government and the Bank must be submitted to arbitration.

I also enclose copy and translation of the note verbale, dated January 8, 1915, received from the Foreign Office in reply.

As you will observe, the Foreign Office, after recalling that, according to the contract of the Bank, all diplomatic intervention is formally prohibited and that further, even if such were possible, the fact of the Bank being a French corporation having its principal office in Paris, should exclude in any case American intervention, the French being represented in Haiti by the Legation of the French Republic, informs this Legation in a purely unofficial manner as to [Page 501]the rights of the Haitian Government in that which concerns the decree of référé of October 20 last, and finally states that the Haitian Government is ready to submit the differences to arbitration, as provided for in Article 24 of the contract of 1910. Of this the Bank was informed.

I have [etc.]

A. Bailly-Blanchard.
[Inclosure 1.]

Minister Blanchard to the Minister for Foreign Affairs.

memorandum.

The director of the National Bank of the Republic of Haiti has informed this Legation that, in execution of a decree of the juge des référés rendered against the Bank on the 20th of October last, by default, the Haitian authorities presented themselves yesterday at that establishment and took from its vaults the sum of $66,910 gold.

The Legation of the United States deems it its duty to make its most express reserves on the execution of the aforesaid decree, rendered under judicial authority and contrary to Article 24 of the contract of the Bank, which specifies that all differences between the Haitian Government and the Bank are to be submitted to arbitration.

[Inclosure 2—Translation.]

The Minister for Foreign Affairs to Minister Blanchard.

note verbale.

By its memorandum of December 30, last, the Legation of the United States set forth that it is its duty to make its most express reserves on the execution against the National Bank of the Republic of Haiti of a decree of the juge des référés rendered on the 20th of October last between the State and that institution. The Legation adds that this execution is contrary to Article 24 of the contract of concession which specifies that all differences between the Haitian Government and the Bank must be submitted to arbitration.

In reply to this memorandum, the Department of Foreign Affairs expresses, first of all, its special satisfaction in noting that the Legation of the United States, in invoking, for mediation, Article 24 of the contract of concession of 1910, testifies to its formal intention, in conformity with the rules of international law, to maintain itself strictly within the limits drawn by this contract.

Under such conditions, it is with entire confidence in the adhesion of the American Legation that the Department of Foreign Affairs reverts again to this double observation: that Article 24, upon which the Legation feels bound to form its reserves, stipulates in express terms, “All diplomatic intervention is formally prohibited,” and that, in addition, Article 3 of the contract of concession establishes without question that the Bank is a French corporation having its principal office in Paris, which even if diplomatic intervention were possible, should exclude, in any case, American intervention, the French having to represent them in Haiti the Legation of the French Republic.

It is, therefore, by virtue of the same contract invoked by the memorandum of December 30 last, that the Department of Foreign Affairs is obliged to oppose the intervention of the Legation of the United States.

However, the position of the parties having thus been clearly determined and all equivocation in this regard being dissipated, the Department of Foreign Affairs sees no objection to informing the American Legation, in a purely unofficial manner, as to the incontestable rights of the Haitian Government in that which concerns the decree of référé of October 20 last.

[Page 502]

Article 24 of the contract of concession states that in case of a difference between the Government and the Bank the point in controversy shall be submitted to arbitration.

In law any contestation is susceptible of being affected, under normal conditions, by various circumstances.

Hence the distinction established between that which constitutes the basis of the contestation and that which constitutes the incidents.

The basis will remain, in any case, submitted to the competent tribunal—in the present case, to arbitration; whereas, the incident, according to its nature, may necessitate the intervention of another jurisdiction.

It is thus that it is recognized that “the constitution of an arbitral tribunal to decide on the difficulties already arisen and to arise in the liquidation of a company, places no obstacle in the way of the provisional jurisdiction of the juge des référés, in case of urgency.” (Pandectes Françaises; Référé No. 380.)

Provided, therefore, that there be urgency, the juge des référés is competent. He decides on the urgency of the case, leaving out entirely the basis of the contestation.

Concerning the present difference, the decree of référé of October 20 has simply decided the absolutely urgent question of the execution of a law of the Legislative Body placing at the disposition of the Executive Power the amounts which are the exclusive property of the Haitian State.

The basis of difference continues to remain entire in spite of the decree of référé.

And it is exactly this difference that the Government is ready to submit to arbitration provided for in Article 24 of the contract of 1910.