The Ambassador in France (Bullitt) to the Secretary of State

No. 3849

Sir: Reference is made to the Embassy’s telegram No. 257 of February 10, 5 p.m.,90 which transmitted a translation of the reply received from the Ministry of Foreign Affairs, dated February 9, 1939, to the note of the Embassy dated November 19, 1938, addressed to the Minister of Foreign Affairs with respect to the terms and [Page 555] conditions of an arrangement for the reciprocal release of property sequestrated during the war.

I now have the honor to transmit herewith, for the information and records of the Department, a copy of these communications, as well as a translation of the reply of the Ministry of Foreign Affairs.

Respectfully yours,

For the Ambassador:
H. Merle Cochran

First Secretary of Embassy
[Enclosure 1]

The American Chargé (Wilson) to the French Minister for Foreign Affairs (Bonnet)

No. 1408

Excellency: I have the honor to refer to the undated note received from the Ministry of Foreign Affairs by this Embassy on July 18, 1938,91 in regard to the reciprocal release of property sequestrated during the war.

This note of the French Ministry of Foreign Affairs was forwarded to the Department of State which, in turn, communicated it to the Department of Justice with a view to ascertaining whether the property held by the Alien Property Bureau of that Department could be released to French claimants, under the reservations and observations set forth in the note of the Ministry of Foreign Affairs.

Under date of November 3, 1938, the Department of State has informed this Embassy92 that a reply has been received from the Department of Justice reading in part as follows:

“If the French Ministry’s interpretation of the previous notes of the Paris Embassy as contained in Sections 1 and 2 of the Ministry’s note means that natives of Alsace and Lorraine and claimants in the situation of Paul Giraud are not to be placed in a position less favorable than other French nationals, we are in agreement with them.

“In order to avoid possible future misapprehensions, the Department thinks it proper to state clearly that in the consideration and disposition of French claims, the Attorney General as Alien Property Custodian will be governed by and limited to the terms of the Trading with the Enemy Act93 as amended and other pertinent municipal legislation. While he is very anxious to go as far as he can to permit the State Department to reach an accord with the French Government with respect to the matters involved in these negotiations, he cannot go beyond the permission contained in this Act. In this connection it is well to bear in mind that absolutely identical treatment of French and American claimants is not possible under the [Page 556] existing law. Section 9 (g) of the Trading with the Enemy Act as amended permits American heirs of Germans to recover 100 per cent of the shares of these American heirs in the estates of Germans in the hands of the Alien Property Custodian, even though heirs having some other nationality are entitled to only 80 per cent. However, the rights of French and American claimants are identical under Section 9 (n), adopted in 1928, under which purchasers of securities assigned alter seizure are entitled to 80 per cent thereof.

“The additional claimants named by the Ministry of Foreign Affairs as not having been included in the list previously submitted to the Ministry, will receive the full advantages of the proposed agreement upon the filing of proper claims on their behalf with the Attorney General if this has not already been done.

“Furthermore, there would appear to be no difficulty in adopting the specification of the Ministry that in the event that a claimant is unable to produce the original documents to prove title, other proof shall be accepted. In like manner, the Government of the United States may adopt the proposal that the attestation of the competent French authorities be accepted as proof of nationality.

“Finally, the French Government now makes the following suggestion:

“‘Finally, in order to facilitate the application of the agreement, and to permit the Office of Private Property and Interests to obtain the execution of contracts which it concluded several years ago with those interested, it appears indispensable that, after proof of nationality and rights of ownership, each of the two organizations which have charge of the restitution of sequestrated property shall receive the dossiers, funds and securities belonging to their nationals.’

“This suggestion has been the subject of careful examination. It is not possible under the laws of the United States to accede fully to the French Government’s proposal. Under the Trading with the Enemy Act, the President is permitted to order the return of property or payment of the proceeds only to the person who was the owner thereof at the time of seizure, or to his legal representatives. Moreover, assignments or transfers of claims against the Government of the United States are void under the law.

“It must be observed, however, that the suggestion is made only ‘in order to facilitate the application of the agreement and permit the Office to obtain the execution of the contracts which it concluded several years previously’. It is accordingly believed that it will be possible to satisfy the French suggestion in principle. An examination of the terms of several of the contracts of cession from the claimants to the Office of Private Property and Interests, as already submitted by that Office, discloses that they can be treated as powers of attorney. Where the cessions are susceptible of that interpretation, the Attorney General can recognize the appropriate agency of the French Government as attorney in fact for the claimant and will make payment to it as such attorney. Should there be cases in which the contract of cession is not susceptible of such interpretation, it would appear that in virtue of the contract the Office of Private Property and Interests will be able to procure suitable powers of attorney.

[Page 557]

“As regards claims in which the claimants have not entered into such contracts with the Office, and have not or do not appoint the Office as their attorney in fact, the Attorney General will be obliged to deal directly with the claimants or their present attorneys in fact.

“It might be observed to the French Government that in some of the cases the claimants, before entering into relations with the Office of Private Property and Interests, had appointed private persons in the United States as attorneys in fact. These attorneys have in many instances expended money and time in obtaining evidence and submitting it to the Alien Property Bureau. While it is the claimant who is personally responsible for these expenses and for the expected fees lost by reason of any revocation by the claimant of the attorney’s appointment and the appointment of the Office as his representative, nevertheless it would appear that the interests of these private attorneys should not be prejudiced.

“It will be impossible to accept the proposal for an exchange of ‘dossiers, funds and securities’ belonging to the claimants. The suggestion is somewhat ambiguous because it is not clear whether the suggestion means that all dossiers, funds and securities shall be turned over simultaneously and in a lump sum after proof of all the claims is made, or whether these are to be turned over as each individual case is decided. However, it does seem that the suggestion is that we shall turn over to the French Government as an administrative agency the dossiers, funds and securities. The word ‘dossiers’ in this connection seems to refer to our files. The law does not permit the Department to surrender its files in any event, and under the Trading with the Enemy Act the only way in which funds and securities can be turned over to the French Government is as attorney in fact for the individual claimants, and then only as each case is decided on its merits. In order that there should be no unnecessary delay in payments, these claims would be handled as expeditiously as possible, and payment in each case where it is proper to be made would be promptly forthcoming as soon as a determmation had been reached therein.”

This Embassy is informed that, after careful examination, the Department of State feels that the opinion of the Attorney General as set forth above regarding the points brought forward in the note received by the Embassy from the French Ministry of Foreign Affairs on July 18, 1938, is reasonable, and one which should remove any remaining doubts as to the conditions on which the property held by the Alien Property Bureau will be released. If the above opinion is acceptable to the French Government, as my Government feels that it will be, the Secretary of State will make the certification to the Attorney General required by section 9 (e) of the Trading with the Enemy Act as amended, as soon as the French Government notifies my Government of its acceptance and of the date upon which the arrangement comes into force.

I avail myself [etc.]

Edwin C. Wilson
[Page 558]
[Enclosure 2—Translation]

The French Ministry for Foreign Affairs to the American Embassy

The Ministry of Foreign Affairs (Office of Private Property and Interests) has the honor to advise the Embassy of the United States of America that it is in agreement with the contents of its note of November 19 last concerning the restitution of sequestrated property.

Referring to its note of July 18, 1938, the Ministry, however, will be grateful if the Embassy will urge the American authorities not to make any settlement with French claimants without requesting the Office of Private Property and Interests to ascertain if the beneficiaries are not among those who have already been paid by the Office.

These provisions will enter into force on the 15th of this month in conformity with the views exchanged between the Embassy and the Office.

  1. Not printed.
  2. Foreign Relations, 1938, vol. ii, p. 340.
  3. Instruction not printed.
  4. Approved October 6, 1917; 40 Stat. 411.