The Secretary of State to the Ambassador in Mexico (Sheffield)
Sir: The Department has received your despatch No. 2264 of May 20, 1926, with which you enclosed a translation of the so-called Law of Colonization, together with copies of the original text of the law. It is noted that the law provides for the expropriation of private property as well as lands of the nation.
An examination of the provisions of the law indicates that it is objectionable in that it provides for expropriation by administrative action without any provision for the usual and orderly judicial procedure whereby the owner of the land is permitted to introduce before a regularly constituted court his evidence in opposition to the [Page 693] attempted expropriation, and to have the matter passed upon by such a tribunal which, if it sustains the expropriation, will presumably fix a just compensation to be paid the owner at the time of the taking of his properties.
On the contrary this law apparently contemplates no payment to the owner by the Government which expropriates the land, but remits the owner for his compensation to the payment by the colonist of very small annual installments with no provision for the payment of interest on deferred payments.
Therefore it appears that the law is lacking in the essential elements of justice usual in the law and procedure of nations concerning the expropriation of private lands for purposes of public utility.
The Department desires you to invite the attention of the Mexican Government to these considerations and to the possibilities which the law furnishes for the infringement of American rights, leading perhaps to further claims on the part of Americans against the Mexican Government through the General Claims Commission,78 and adding to the difficulties already pending in respect of the land and petroleum laws,79 and of expropriations under the agrarian laws.
You will add that it is recognized that the situation may be ameliorated to some extent by the provisions of the regulations to be issued for the enforcement of the law, and that your Government earnestly hopes that such may be the case, but that in any event it desires to place on record with the Mexican Government its reservation of the rights of American citizens which may be unfavorably affected by the law.
I am [etc.]