The Chargé in Guatemala (Hawks) to the Secretary of State
[Received September 12.]
Sir: With reference to previous correspondence, I have the honor to transmit herewith the following documents,11 concerning the case of P. W. Shufeldt:
- Copy of Strictly Confidential Memorandum by Mr. Lara, Mr. Shufeldt’s lawyer, with translation;
- copy of an order of the Court under date of August 30, 1928, with translation;
- a copy of a letter from Mr. Shufeldt to the Minister of Agriculture, with translation;
- a copy of a Memorandum from the Minister for Foreign Affairs, with translation.
In reply to my request, Mr. Shufeldt handed me on August 29, a strictly confidential Memorandum signed by his lawyer, Mr. Lara, containing the latter’s opinion regarding the court action in the case of Mr. Shufeldt.
The same afternoon, I called on the Minister of Agriculture, Mr. Solórzano, and said that I would like to speak to him entirely informally and unofficially, concerning the Shufeldt contract. In reply to a question, he stated that, before deciding whether or not the Government would be willing to arbitrate the question of how much should be paid Mr. Shufeldt, it was necessary to find out from the Minister of Government and Justice the present status of the court proceedings. I then remarked that Mr. Salazar had withdrawn from the negotiations and asked him whether the Government was willing to negotiate further in the matter. He said that, if Mr. Shufeldt would withdraw his claim of four hundred and ninety thousand odd dollars, and was willing to negotiate either directly or through a third party other than Mr. Wilson, he. Mr. Solórzano, was perfectly willing to ask the President if the latter desired to designate someone to negotiate with Mr. Shufeldt. He reiterated the stand of the Government that it could not admit that Mr. Shufeldt had any rights under his contract and, in reply to a question, stated that, the judicial action taken in the court by the Government Solicitor was merely a matter of form to put into effect the Legislative Decree, disapproving the contract, and that it would not in any way affect the claims of Mr. Shufeldt. Mr. Solórzano said that, in case a sum were agreed upon, it would then be necessary to find some means by which the Government could legally make such a disbursement, as otherwise the Legislature could refuse to approve of it. He added that it might be possible for a prior agreement to be reached as to the sum and then for Mr. Shufeldt to bring a claim for that sum against the Government in the courts, which claim the courts would probably grant.
Mr. Shufeldt called that afternoon and I repeated to him my conversation with Mr. Solórzano. I asked whether he was willing to negotiate with the Government, telling him that I did not think it would be of any use for him to continue with his claim of over $400,000.00, as both Mr. Salazar and Mr. Solórzano had stated definitely that the Government would not negotiate on that basis. He said he was willing to negotiate, providing the Government would suspend court action during the negotiations. He then asked me if I could [Page 130] negotiate for him or could get the Government to suspend temporarily the action of the court. I replied that I could not possibly take such action without instructions from the Department. He then said, that he would discuss the matter with Colonel Wilson and tell me his decision the following day.
Mr. Shufeldt called at the Legation on August 30 and said that, after his conversation with Mr. Wilson, he had decided to ask the Department to instruct the Legation to request the Government to suspend the Court proceedings pending negotiations and also to carry on these negotiations with the Government. He asked me, if the Legation would be willing to transmit such a message for him at his expense, since if he transmitted it in the clear, the Government would of course know about it and it might have a result detrimental to his case. I said that I would be willing to send the cable at his expense, (see Legation’s cablegram No. 107 of August 30, 4 p.m.)12
This afternoon the enclosed Memorandum No. 7530 of September 4, 1928, was received from the Foreign Office,12 in which the Minister for Foreign Affairs Salazar pointed out that Mr. Shufeldt always has recourse to the courts of Guatemala in this matter. It is of interest to note that Mr. Salazar has never made such a strong statement directly to me, although he has very vaguely hinted on one occasion, that Mr. Shufeldt could go to the Courts if he so desired.
It is my opinion that if Mr. Shufeldt is forced to take this matter to the courts it will be very difficult for him … Mr. Lara, who is Mr. Shufeldt’s attorney at present, states, according to Mr. Shufeldt, that he will not try this case in court and that, in any event, Mr. Shufeldt would be sure to lose, despite the fact that all the legal rights are on his side. I have been informed by other Americans here that it would be exceedingly difficult for Mr. Shufeldt to obtain the services of a foreigner in Guatemala due to the fact that, if he had any vested interests here, such action on his part would be very likely to prejudice them in the future. …
I have [etc.]