394.1153 Smith Company, Werner G./45: Telegram
The Consul General at Shanghai (Lockhart) to the Secretary of State
Shanghai, August 16, 1938—5
p.m.
[Received August 16—2:30 p.m.]
[Received August 16—2:30 p.m.]
1117. My 1088, August 10, 8 p.m.
- 1.
- The Japanese Consul General came to see me today and inquired whether the wood oil case could now be settled on the basis of the requisitioning of the oil by the Japanese naval authorities, payment to be made on the basis of cost price as shown by the invoices and shipping documents, such payment to be made in United States currency if the papers show that the oil was purchased on that basis. Hidaka stated that the question of any loss by theft or leakage would necessarily have to be adjusted later. I pointed out that there might possibly also be some charge for the use of the junks but Hidaka would not commit himself on this point because he said the Japanese military may claim possession of the junks as Chinese property. Hidaka emphasized that the Japanese naval authorities do not wish to be placed in the position of purchasing the oil because such action might create an embarrassing precedent but that he felt sure the question could be settled on the basis of requisitioning the oil for naval uses and payment therefor as such. Hidaka reported that the naval authorities are very anxious to settle this long standing case and he expressed the hope that the Department and the owners of the oil would accept the proposal in principle after which the exact value of the oil could be determined and payment made. I believe that this proposal offers the only possibility of settling this case in the near future.
- 2.
- A copy of this telegram and my 1088, August 10, 8 p.m., have been sent by mail to Nanking.
Repeated to Chungking, Hankow and Tokyo.
Lockhart