411.12/2545
The Legal Adviser (Hackworth) to the Counselor of Embassy in Mexico (Boal)
Dear Mr. Boal: Mr. Duggan has shown me your interesting letter of February 2, 1938, regarding a possible en bloc settlement of the general claims.
The attitude of the Department in this matter was set forth rather fully in instruction No. 1855 of December 3034 and was well conveyed to the Foreign Office in the Embassy’s very good note of June [January] 13. Perhaps the following further explanation of the Department’s attitude may be helpful to you in making this Government’s position clear, in a proper manner, to the Mexican authorities.
In the first place, the Department cannot properly abandon rights conferred upon this Government, in the interest of the numerous claimants, by the provisions of the General Claims Protocol of 1934. But, putting aside that phase of the matter for the purpose of this consideration, suppose we should agree to ignore those specific provisions of the Protocol for the purpose of an informal discussion of en bloc settlement possibilities, and suppose, then, that such discussions proved unsuccessful, as they very well might. Having exhausted the possibilities in that direction by informal discussion, it would then be wholly impracticable, of course, to insist that the Mexican Government proceed to a formal consideration of the same subject as the necessary preliminary to concluding a convention providing for reference of the unadjudicated claims to an umpire, in accordance with the second alternative provision of paragraph “Fifth” of the Protocol.
It is well known to the Department, of course, that the Mexican Government does not desire to refer the unadjudicated claims to an umpire, but the fact is that it agreed to do so in the event that an en bloc settlement of the claims should prove impossible, and the Department has no intention of releasing the Mexican Government [Page 768] from that obligation, either expressly or by implication. It is unnecessary to explain to you the reasons for that attitude. On the other hand, the Department, in accordance with the policy which characterized its attitude in agreeing to the Protocol of 1934, has no disposition to be arbitrary and unreasonable in the matter of concluding an en bloc settlement. In this situation, the provisions of the Protocol and the obligations thereunder being what they are, the Department feels that it has no proper alternative in the matter save that of insisting upon proceeding, as agreed in the Protocol, to the formal consideration of an en bloc settlement or of permitting its efforts in that direction to become frustrated by the definite refusal of the Mexican Government to comply with its clear and specific written engagement in that connection.
The Department would be disposed, in the formal negotiations, to do everything practicable in an effort to reach a proper en bloc settlement of the unadjudicated claims, but unless the Mexican Government is willing to proceed in the same spirit and in accordance with the Protocol, on the basis of faith in that attitude, the Department can only conclude that it is definitely unwilling to effect compliance with its written obligation. If such a conclusion were forced upon this Government the Department would probably be unable to see any virtue in concluding other agreements of the fulfillment of which it could have no greater assurance.
Since the Mexican Government apparently has not been disposed to accept the Embassy’s note of January 13 as a definite indication of this Government’s policy in this connection, I hope you can, in the light of the foregoing and in a proper, informal manner, convince the appropriate authorities that the Department will consider no other procedure at this stage than formal action looking to the conclusion of a convention precisely in accordance with the terms of paragraph fifth of the Protocol.
Sincerely yours,