417.00/507

The Chargé in Nicaragua ( Dawson ) to the Secretary of State

No. 420

Sir: Referring to the Legation’s previous despatches concerning the status of the Nicaraguan Claims Commission and its major awards, particularly to despatch No. 400 of August 16, 1934,94 transmitting copies of a letter from Judge J. S. Stanley, President of the Commission, to President Sacasa enquiring as to the Commission’s future, I have the honor to enclose copies of a reply from President Sacasa, dated August 23, 1934,94 which was shown to me this morning by Judge Stanley.

It will be noted that the President’s letter expresses his personal opinion that the Board of Directors of the National Bank will extend the desired loan of C$700,000 to the Government for payment of all pending awards of the Claims Commission in cash. Mr. Hans Sitarz, General Manager of the National Bank informs me that he is by no means certain that this will be the case. He states that his own recommendation is now adverse in view of the introduction by the Minister of Finance on August 22 of a bill for the active establishment of a National Mortgage Bank which will, in his opinion, involve inflation. He says, further, that, should the loan be made, he is convinced that one of the conditions laid down will be for direct payment of awards to claimants by the Bank instead of the advance of the funds to the Government for payment by the latter.…

[Page 574]

Judge Stanley advised me that the House on August 22 passed a bill introduced by General Andrés Murillo, generally accepted as the Sacasa administration’s floor leader, which would extend the life of the Commission to December 31, 1934, but authorize the President to terminate it at an earlier date should the Commission’s work be brought to a close before that time (yesterday’s press reported this action). He stated that Onofre Sandoval, the administration leader in the Senate, had assured him that the bill would be quickly approved in that body also, probably today.

Judge Stanley said that he hoped that the work of the Commission proper could be finished by September 20 although it would probably be necessary for one member of the Commission, its secretary and several employees to remain at their desks for about six weeks longer to draw up the Commission’s final report95 and attend to other pending details. Judge Stanley remarked that he had already reserved passage on a vessel sailing September 25.

In discussing the Commission’s work, Judge Stanley commented that it would have been easily possible for it to complete its tasks by June 30, 1934, had it not been for extensions by the Nicaraguan Government of the time limit for filing claims and uncertainty as to the manner in which major awards were to be paid. He said that the Commission intended to leave in its files two awards in each pending case, one specifying payment of a certain sum, in bonds, and the other half the amount of the first, in cash, because of doubt as to whether the loan from the National Bank would actually be granted.

Respectfully yours,

Allan Dawson
  1. Not printed.
  2. Not printed.
  3. Copy of final report of the Commission was transmitted to the Department in despatch No. 1133, November 1, 1935, from the Chargé in Nicaragua; not printed.