812.51/1734

The Acting Secretary of State to the Attorney General (Mitchell)

Sir: It appears from information in the possession of the Department that several years ago Thomas W. Lamont and others constituted themselves a body known as the International Committee of Bankers on Mexico and thereafter entered into several agreements with the Mexican Government whereunder funds were turned over to the Committee by that Government for the purpose of refunding and liquidating obligations of that Government.

The Department is further informed that some months ago Gustavo Gallopin, owning certain bonds of the Mexican Government which he had not deposited with the Committee in question, suing on behalf of himself individually and on behalf of all other bond holders who may be similarly situated, brought suit in the Supreme Court of the State of New York, County of New York, against the members of the Committee individually and as such Committee wherein he sought to reach the balances remaining in the hands of the Committee of funds deposited with it by the Mexican Government.

It also appears that on April 6, 1931, upon motion of Davis, Polk, Ward well, Gardiner and Reed, attorneys for the defendants, Justice John Ford of the Supreme Court of the State of New York, ordered [Page 734]that the plaintiff be directed to obtain the appearance of the Mexican Government in the action, following which order the plaintiff caused a summons to be delivered to the Mexican Consul General in the city of New York, but it seems that this service was not followed by the appearance of the Mexican Government in the action.

Newspaper reports indicate that on June 22, 1931, Justice Valente of the Supreme Court of the State of New York, County of New York, appointed receivers in the indicated action for part of the fund held by the Committee mentioned, ruling that pending the trial of the action, the plaintiff is entitled to have a part of the fund set aside corresponding with the amount of bonds held by the non-depositing owners as compared with the total amount.

The Department is now informed by the Mexican Ambassador to the United States in a note dated June 26, 1931, that the Committee in question has appealed from the order of Justice Valente and that this appeal will be heard before the Appellate Division of the Supreme Court of the State of New York on Friday, July 3 at 10:30 o’clock in the morning.

Translation of that note is enclosed, from which you will observe that the Ambassador requests that the Supreme Court of the State of New York be informed:

  • “First: That the Government of Mexico declines to appear in the suit instituted by Mr. Gustavo Gallopin against Thomas Lamont and others;
  • “Second: That the funds which are in the possession of the Lamont firm and in connection with which Mr. Gallopin filed suit, are property of the Government of Mexico and therefore not subject to seizure since they belong to a foreign Government.”

I should appreciate it very much if you would instruct the appropriate United States attorney as promptly as possible, to appear before the Appellate Division of the Supreme Court of the State of New York at the time mentioned for the hearing of the appeal and to present to that Court the position of the Mexican Government as above indicated.

Of course you are familiar with the fact that there are numerous precedents for compliance with the request made by me, but it is perhaps appropriate to refer to a few instances in the recent past of similar requests which this Department has made upon your Department. In this relation references may be made to a letter which Secretary Hughes wrote to the Attorney General January 17, 1923, asking that the United States Attorney for the Southern District of New York be instructed to appear before United States District Court and make a certain statement bearing upon the litigation instituted by the Oliver Trading Company, an American corporation, against the [Page 735]Central Administration, then functioning in Mexico;24 to a letter addressed by this Department to the Attorney General September 23, 1929, asking that steps be taken to advise the Supreme Court in connection with litigation pending therein of the status of the Swedish State Railroads and of the Swedish Government’s claim to exemption;25 and to a letter addressed by this Department to the Attorney General, September 11, 1899,26 asking that the appropriate United States attorney be directed to take appropriate action with respect to a suit instituted in the Courts of the State of New York by one John G. Hassard against the United States of Mexico.27

Very truly yours,

W. R. Castle, Jr.
  1. Letter of Secretary Hughes, January 17, 1923, not printed; for previous correspondence printed concerning the Oliver Trading Company, see Foreign Relations, 1923, vol. ii, pp. 574 ff. See also ibid., vol. iii, pp. 260 ff.
  2. Letter to the Attorney General, September 23, 1929, not printed; for correspondence concerning the litigation of the Swedish State Railroads, see pp. 1009 ff.
  3. Not printed.
  4. 29 Misc. 511.