The Secretary of State to the Ambassador in Germany (Dodd)

No. 585

Sir: I refer to previous correspondence in regard to the claim, in the amount of $500,000.00, that was filed in behalf of Mrs. Katherine M. Drier against Germany before the Mixed Claims Commission, United States and Germany, which on January 14, 1928, granted her an award of $48,000.00, plus interest, and on April 5, 1929, an additional award of $250,000.00, plus interest. On November 18, 1932, the American Agent filed a petition with the Commission for a further award in this case, and as a result of discussions between the Agent of the United States and the Agent of Germany they agreed on February 27, 1933, that the claimant should have an additional award in the amount of $160,000.00. On March 1, 1933, the German Agent informed the American Agent that his Government had approved the settlement, and from then on the claim was included in the list of claims in relation to which tentative settlements had been reached by the two agents in February, 1933.

It was the understanding of the Government of the United States that this settlement was satisfactory to the German Government. However, that Government later declined to include the Drier settlement among the settlements that were to be submitted to the Commission for approval and the entry of awards, stating as a reason therefor that an examination of evidence in the case, said to have been newly discovered, cast suspicion on the claimant’s proof.

On May 7, 1934, a meeting of the Commission was held and awards were entered in regard to all the agreed settlements, with the exception of the claim of Katherine M. Drier. Notes were thereupon exchanged by the Secretary of State and the German Ambassador59 “reciting that all cases that were pending before the Commission were disposed [Page 258] of, with the exception of the claim of Mrs. Katherine M. Drier,” and stating that the Commission “shall not, in the future, be asked to consider any new cases already decided, other than the Sabotage cases and the Drier case.[”]

The petition for further award that had been filed by the American Agent in November, 1932, was thereupon pressed by him. Upon certification of disagreement by the National Commissioners, the case went to the Umpire. In a decision of July 29, 1935,60 the Umpire dismissed the first two grounds advanced by the American Agent for the support of the claim, and considered specifically the Agent’s third contention, namely, “that the awards (previously given) are juridically wrong, because the Commission had no power to reduce them to an amount less than the sum shown by the undisputed proof to be the amount of loss suffered”. The Umpire held, however, that the case could not be reopened for the consideration of errors of fact. He stated that the Commission had “no jurisdiction to sit as a tribunal to grant new trials for errors of fact, particularly where those errors involve opinion as to value”. A supplemental petition for a rehearing of the case was filed on November 22, 1935, by the American Agent. This supplemental petition requested that the case be re-opened for a further hearing, and was referred to the Umpire for decision by the two National Commissioners, inasmuch as the decision of the Commission on the first petition had been handed down by him on a certificate of disagreement by the two Commissioners. On January 29, 1936,61 the Umpire rendered the decision of the Commission, dismissing the petition, stating among other things that “if a new cause of action is asserted, based upon an agreement between the diplomatic representatives of the two governments, I think the Commission is entirely without authority to enter a decree based thereon. It can only act upon the agreements of the national agents accredited to represent the respective nations before it”. A subsequent motion for re-argument of the claim was submitted to the Umpire, who on March 20, 1936, denied the motion.

It is the opinion of the Department that this case deserves further consideration by the two Governments, notwithstanding the outcome of the matter before the Commission. Following the filing of the petition for re-hearing in 1932, no question was raised as to the value of the evidence that had been produced for the support of the claim. In the light of the compromise settlement for $160,000.00 agreed upon by the two Agents and approved by the German Government, the Government of the United States had the right to assume that in [Page 259] refusing to go on with the agreed settlement on the basis of newly discovered evidence, that evidence would be made available to this Government for examination and consideration. As a matter of fact, however, the first notice the Department had of evidence said to cast suspicion on the claimant’s proof was contained in the note of May 7, 1934, of the German Ambassador, in which he stated:

“Concerning the claim of Mrs. Catherine McNider Drier, Docket No. 11485, I beg to inform Your Excellency that the German Government prefers to have this matter left pending before the Commission for the time being, as the German Government has recently been advised that the material submitted by Mrs. McNider Drier, on the basis of which the Commission granted her an award of $250,000 plus interest in 1929, appears to be not beyond suspicion. An investigation has been started accordingly which will take a little time for its conclusion.”

Nevertheless, when the German Agent filed his answer to complete the pleadings on July 2, 1934, no new evidence whatsoever was tendered; nor, so far as the Department is aware, has any evidence been produced which would “cast suspicion on the claimant’s proof.”

When the Department agreed in the exchange of notes of May 7, 1934, to the examination of the claim by the Commission, it was justified in believing that such impairing evidence, if it really existed, would be presented to the Commission, and that, instead of resting its case upon technical grounds of procedure, the German Government would meet the issue squarely by producing such evidence for examination by the Commission. The following language in the note of the Secretary of State of May 7, 1934, is in point:

“If the case is left before the Commission, it will be necessary to give the claimant time to marshal additional evidence to combat any evidence that the German Government may submit, which will mean that the completion of the work of the Commission will be indefinitely postponed. The amount involved is comparatively small.

“It is therefore hoped that on further consideration your Government will deem it desirable to give finality to the settlement heretofore reached in the Drier case.”

Inasmuch as the decisions of July 29, 1935, and January 29, 1936, were based on technical grounds and apparently on an erroneous impression by the Umpire that the agreed settlement for $160,000 had been arrived at by the diplomatic representatives of the two Governments, rather than by the two Agents, and since no proof was offered to impair the integrity and sufficiency of the evidence that was produced for the support of this claim, the Department feels that the German Government should now agree to make effective the compromise settlement reached by the two agents and subsequently approved by the German Government.

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You are therefore requested to take this matter up with the Foreign Office and endeavor to persuade it to agree to the entering of an award in this case on the basis of the agreement just referred to.

Please keep the Department promptly informed regarding developments.

Very truly yours,

Cordell Hull
  1. Foreign Relations, 1934, vol. ii, p. 492.
  2. Mixed Claims Commission, United States and Germany, Decisions and Opinions from January 1, 1988 to October 80, 1989, p. 1075.
  3. Ibid., p. 1082.