362.115 St 21/151: Telegram
The Ambassador in France (Wallace) to the Secretary of State
[Received 10:28 p.m.]
1172. B–92 for Department and Davis.
Your 934, May 14. My paragraph numbers correspond with yours.
[Page 593]1st. Obvious that United States assents to nothing until all details arranged. Therefore, your first paragraph suggests fear that my personal opinion may lead me to deviate from instructions. I should naturally be careful about that, but hinting does no harm. With this assurance, I will continue to express opinions and offer advice freely. Hard to stop habit of lifetime.
2d. Appropriateness of time depends chiefly on whether you want to discuss subject now. My suggestion, as to method of forming Independent Tribunal, did not contemplate delay until method decided. Proposal suggesting a quick method merely to show Poincaré and others than Poincaré’s fears of long delay in arranging Tribunal were unfounded. Can you identify your suggestion for same on reconsideration without committing yourself.
3d. Do you not think Reparation Commission in making agreement is merely acting as agent of governments. Same theory applies to proposed substitution Reparations Commission for governments paragraph eye. Commission called by Tribunal would act merely as agent and you would have advantage of dealing with one party instead of several without any surrender of principle. The original language “other governments concerned” is very indefinite. Does it mean all powers who ratify or all powers who under the treaty are entitled to share in distribution of ships.
4th. Shall probably substitute “independent” [for] “impartial”. As to remaining, if Reparation Commission acts as agent then Tribunal automatically gets all authority governments can dele gate but the really important thing is to make sure Tribunal has authority from Reparations Commission not merely in its capacity as agent but in its capacity as Commission under the treaty. Except for treaty these tankers remain property of German clique. Government[s] have no authority to take tankers away from German clique or to create tribunal to dispose of tankers. If United States is [to] get tankers you must start with the theory that tankers have been taken away from Germany by the treaty. That assumption puts tankers in jurisdiction of Reparations Commission not as agent for government[s] outside of treaty but as commission under the terms of the treaty. Starting with this assumption tankers [can be transferred to] Standard Oil Company only by decision of Reparations Commission or by decision of Tribunal acting under delegated junction of authority of Commission. The point is that in the absence of amendment to treaty which requires legislative assent the proposed agreement for [decision] by a tribunal rests legally on delegated power be Reparations Commission.
5th. Expect no trouble about two voyages though still possibility may have to concede three.
Paragraph 6th and 7th. Will discuss these later in this message.
[Page 594]8th. Bradbury is not likely to accept proposal. Original delegates would probably accept if subject not discussed but discussion likely to arouse same [some?] doubts in their minds. Their necessities may induce them to ignore these difficulties but Bradbury not subject to same pressure and not likely to yield to their persuasion on legal point which he regards as precedent of great importance. Pressure of necessity may help gain our point in this particular case but I believe it far wiser policy to abandon this advantage for the sake of getting tankers immediately into service leaving our case to stand or fall on its merits.
9th. Submitted Cook’s suggestion my B–7780 merely for your information. Did not seem practicable. I do not agree with your conclusion that proof of beneficial ownership necessarily eliminates accounting. If result of beneficial ownership is to return tankers to Germany then credit necessarily eliminated otherwise seems to me nothing more than vague possibility.
Paragraphs 10th and 11th. Need not reply except to point out that paragraph d as outlined your 729 March 29 [April 10],80 was accepted by Commission though future discussions may open up anything.
12th. Returning to your paragraphs 6 and 7. Your cable arrived late Monday. Saw Bradbury Tuesday. He made objection as before. He has no objection to Standard making any claim of any kind before Tribunal. His objection is to instructing Tribunal that proposal [proven?] ownership of securities shall necessarily lead to any particular result. He wishes whole matter to be determined by Tribunal. If your language “claim of beneficial ownership” means beneficial ownership in tankers themselves he would accept your idea. It would then be possible for Tribunal to consider whether ownership of securities as proved did or did not constitute beneficial ownership of the tankers but if your language means, as he thinks, that proposal [proven?] ownership of securities necessarily determines the question of beneficial ownership then he is unwilling to accept your suggestion.
13th. On theory that this may be possible solution have continued
discussion with Bradbury. He would accept following language:
Note: Change[d] last part of your language which is intended merely to make sure that in any case where Tribunal is of opinion that Commission is required to credit Germany it shall not be compelled to transfer tankers without proper provision under direction of Tribunal for meeting that credit. The foregoing language also omits ratio between securities and [tonnage] which is objectionable to Bradbury because seems to interpret what beneficial ownership means whereas Bradbury insists that Tribunal must make its own interpretation.
14th. If something on above lines cannot be agreed Bradbury sees nothing to do except refer whole subject to Governments to work out solution as they and you agree. I should make reserve on this point but see no other solution though it is misnomer to call such reference a solution.
15th. I have shown paragraphs 12th, 13th and 14th this message to Bradbury to-day, Wednesday, and they meet his approval.
16th. Will add that provided Tribunal is satisfied that ownership of securities proved constitutes beneficial ownership then seems inevitable that translation of such ownership into the tankers themselves will practically follow proportional lines. Boyden.