338.6253/4: Telegram
The Minister in Haiti ( Bailly-Blanchard ) to the Secretary of State
[Received July 7—2:30 p.m.]
39. Department’s 31, June 25th, 3 p.m., received garbled [on] June 27th, corrections received from Department July 1st, finally deciphered July 5th. Negotiations in progress with the Haitian Government regarding liquidation sequestered German property for the past two months. Finally a project of law was submitted by the Foreign Office, a synopsis of which is as follows:
- Article 1. [There] is hereby repealed law of November 1918 ordering the liquidation of German sequestered property.
- Article 2. The amounts realized from the liquidated property are reserved, first, to amounts disbursed by Haitian Government for internment and repatriation of Germans; second, to the payment of claims provided for in paragraph 4, annex of section 4, of part 10 of the Treaty of Peace; third, to the settlement of pecuniary obligations provided for in article 296 of the Treaty of Peace and which form part of the audit of the [Office of] Verification and [Compensation], the above amounts to be determined by the Minister of Justice; fourth, to payment of the claims existing against German firms. The Sequestrators-Liquidators are charged with this category of payment which must be made in accordance with the laws of the code de commerce.
- Article 3. The balance of the proceeds of liquidated property shall revert to their owners upon the order of the Minister of Justice.
- Article 4. Restitution of the unliquidated property, books, documents, commercial papers shall be made by the Minister of Justice directly to the chiefs of the German firms or to their authorized representatives.
Under this law, claims 1, 2, and 3 of article 2 are to be paid pro rata from the proceeds belonging to the firms which are solvent and the same as regards the pecuniary obligations provided for in article 296 of the Treaty of Peace as concerns the Germans residing in Germany.
Under article 1 the liquidation to cease at once and under article 4 the unsold movable and immovable property is to be returned to the [Page 238] German owners from whom the Allied nonresident creditors may seek settlement of their claims, there being no available funds belonging to said firms to settle such claims as provided for in paragraph 4, article 2. The liquidation of German sequestered property has not been completed because of want of authorization from the Minister of Justice. After conferring with my British and French colleagues modification to this project of law was submitted to the Foreign Office to the end that liquidation which had been suspended be completed in order that the claims of Allied creditors may be settled from the proceeds thereof in accordance with paragraph 4 of article 2, which modification was refused by the Minister of Foreign Affairs who, in a subsequent conference held at his request with my two colleagues and myself on July 1st, insisted that the liquidation should begin at once and that the Allied creditors should look to the German firms for the settlement of the claims under the Haitian laws.
Instructions respectfully solicited by cable.