The Minister in Paraguay (Mooney) to the Secretary of State

No. 561

Sir: Referring to my despatch No. 556 of December 24th,19 I have the honor to inform you, that in my initial interview with Doctor Ramón Lara Castro, the new Paraguayan Minister for Foreign Affairs, I made mention of the pending port concession, whereupon he suggested that I write a formal note setting the matter forth succinctly in accordance with my understanding of it. In accordance with that suggestion I have prepared and transmitted a note on the subject, a copy of which I enclose for your information.

I have [etc.]

Daniel F. Mooney

The American Minister (Mooney) to the Paraguayan Minister of Foreign Affairs (Lara Castro)

[No. 211]

Excellency: By virtue of a specific instruction of my Government I have the honor to invite the attention of Your Excellency to the following:

The Paraguayan Congress by its act No. 159, duly passed, and promulgated on October 18, 1915, granted to the Construction and [Page 340] Engineering Finance Company, of New York, a concession to construct and operate a port at the city of Asunción. The instrument of concession, framed in harmony with the law authorizing the same, stipulated the time at which the work on the port was to be commenced, the time at which stated progress was to be made thereon, and the time at which the same was to be fully completed, wherein, it is admitted, the concessionaire made ostensible default.

However, as an excuse for this apparent default and as a reason why its commission, involuntary on the part of the concessionaire, should not, until now, have the effect of vitiating the contract, the attention of Your Excellency is called to the fact that the seeming laches were concurrent with the World’s war, in which America did not intervene until after the grant of the concession, when it was impossible, by reason of restrictions on the export of capital, to provide finances for the enterprise, and was alike impossible to secure the proper and necessary material for the work, or even to secure the transportation of such material if obtained. In view of these unfor[e]seen causes, which were wholly beyond the control of the concessionaire, and which could not be foreseen by the exercise of due care and diligence, it is suggested that the performance of the contract obligations was prevented by the act of God, (force majeure), and by no fault of the obligor.

I am also instructed to make known to Your Excellency that the concessionaire has now arranged for the capital adequate for this enterprise, and is otherwise prepared to make an early start on the construction of the port and carry the same to a prompt conclusion, if permitted by the Paraguayan Government so to do.

Because of all of the foregoing I am further instructed to bring this whole matter to the attention of His Excellency the President of Paraguay, through the intermediary of Your Excellency, with a view to securing an annullment of the forfeiture of this concession, if any such forfeiture has been decreed, that the franchise be revivified, and that the concessionaire be now allowed a reasonably sufficient length of time to build the port.

Accept [etc.]

Daniel F. Mooney
  1. Not printed; see telegram of the same date, supra.