File No. 812.63/179
Mr. S. C. Neale to
the Secretary of State
[Extract]
Washington,
June 19, 1916.
Sir: Referring to my letter of June 2,
last,2 in which I
brought to your attention, upon behalf of the Committee of American and
Foreign Owners of Mines and Smelters, the deplorable situation in Mexico
and the arbitrary and confiscatory manner in which the de facto Government was acting in respect to American
investments in that country, I beg to submit to you certain facts in
connection with the property of the Cubo Mining and Milling Company, of
Guanajuato and the Mina Mexico Mining Company of Sonora, from which it
is apparent that as to the Cubo Mining and Milling Company, of
Guanajuato, there is a practical confiscation
[Page 723]
of the property of that Company, and there is
threatened confiscation of the Mina Mexico Mining Company, of Sonora,
both caused by the unwarrantable and illegal action of the officials of
the de facto Government.
By the decree of General Calles, herewith enclosed and made a part of
this letter, it will be noted that the operation of mining properties in
the State of Sonora, whether owned by Mexicans or foreigners, must be
commenced one month from the date of the decree, which was published in
the Boletin Official, May 27.
While my clients have been unable to secure a copy of any decree which
the Governor of Guanajuato may have issued, he is evidently on record as
authorizing the denouncement and operation of mining properties that are
not being operated, as shown by the following translation from the issue
of El Democrata, of May 16, 1916:
The Chairman of the City Council at La Luz, Mr. E. Sanchez,
authorized by General Jose Siurob, Governor of the State, has
invited all residents of that rich ore district to denounce all
those mining properties that are not in product because their
owners have suspended working them or have abandoned them, in
order that they be distributed in camps to be exploited by men
willing to do so.
Also the representative of the authority has invited all
merchants and farmers out of the district to return and
contribute to the prosperity of the district.
As it is well known, the exploitation of mines in the way of
camps results in the equitable distribution of the products and
is of great advantage not only for the miners but for all
working people.
It is safe to predict a brilliant future for Guanajuato if the
people will follow the idea of General Siurob, made known to us
through the Chairman of the City Council at La Luz.
I wish to impress upon you most earnestly and to call your special
attention to the fact that these arbitrary acts of the Governors of
Guanajuato and Sonora are not the acts of revolutionists or bandits, but
officials of the Carranza Government and it must be presumed are acting
in consonance with and deriving their authority from the de facto Government.
I respectfully ask that this important matter be brought to the attention
of the Special Representative of the Department in Mexico, with
instructions directing him to present, at once, the case to the de facto Government, insisting that the wrongs
which I have indicated in this letter shall be promptly remedied and
that no further effort shall be made by the de
facto Government to interfere with the property rights of the
Cubo Mining & Milling Company and the Mina Mexico Mining Company of
Guanajuato and Sonora respectively.
I am [etc.]
[Inclosure—Translation]
decree no. 56
General Plutarco Elias Calles, Governor and Military Commander of the
State, in use of the faculties with which I find myself vested
through the First Chief of the Constitutionalist Army in power of
the Executive of the Republic, and considering:
That the triumph of the Constitutionalist Revolution has been
consummated, from a military standpoint, in all the National
Territory, except for very reduced and insignificant exceptions, and
(consummated) in an absolute manner in the State of Sonora which is
controlled by the Revolutionary Government:
[Page 724]
that since the Federal Government through my
Executive has extended to the mineral enterprises and industrials
guarantees and necessary securities for the exploitation of their
business, and to this end, by means of repeated official circulars,
has exhorted the various enterprises, as quickly as possible, to
commence the work of exploitation, in the manner and extent demanded
by circumstances: that it is public knowledge that many of the
enterprises remain as yet unexploited because, solely, of
combinations financial and political among the owners who are not
concerned in the moral side of their procedures: that in view of the
situation, because it obstructs the State and the Nation,
exploitation of the industries is of public and urgent necessity;
and for this reason, it becomes necessary for the Executive to
dictate radical remedy upon this affair, without in any manner
opposing the principles of justice and equality: I have seen fit to
(decree) the following:
Article 1. The exploitation of the mineral business and industries is
of public utility in the State.
Article 2. There is given to the owners or companies of said
enterprises, whether they be Nationals or foreigners, the period of
one month, counting from the publication of this decree, to commence
the work of operation of their properties or industries.
Article 3. If at the end of the period fixed by the previous article
the said industrial enterprises have not been placed in a state of
exploitation, with a force of at least one hundred workers as a
minimum, the State shall have the right to take charge, temporarily,
of the administration of those (properties) which it so judges, the
necessary public declaration in the Periodica
Oficial sufficing as notice. Those properties or industries
which have not operated previously, or which have not employed
previously one hundred workers in their labor, can employ a less
number, with the approval first of the Executive.
Article 4. The same power of intervening will hold in the State in
regard to properties or industries which are actually in
exploitation at present, and which suspend their operations for more
than eight days, without a justifiable motive or permission of the
Governor.
Article 5. Upon the State taking charge of the administration of a
property or industry, in accordance with the previous articles, the
first political authority in the locality (of the property)
accompanied by honorable citizens of the same locality, will
carefully take in duplicate an inventory of the furniture and
existing appurtenances of it (the property). One copy of said
inventory will be sent to the Executive, and the other to the party
interested if he solicits it.
Article 6. The products of the enterprises taken over in virtue of
this law shall be subjected, first for the payment of the federal
and local taxes which pertain to the property or industry; if no
production is made, the taxes referred to shall be demanded from the
owner of the enterprise, according to the respective laws.
Article 7. Upon the arrival of the time for returning to the
respective owners the properties or enterprises intervened, the
State will render an account for payment of its administration,
making delivery within a period of fifteen days of the products
obtained.
Article 8. If by reason of the actions of the owners or companies a
property is returned to them by the State before exploitation has
been commenced, but when already the State has made distributions in
it (the property), they (the owners) shall reimburse the State for
the amount of said distributions within a period of fifteen days
following.
This decree will take effect from the day in which it is
published.
Palace of the Governor of the State,
Hermosillo,
Sonora, May 18, 1916.
General P. Elias Caixes
Lic. Enrique Moreno
Secretario de Estado
