391.1164/127: Telegram
The Secretary of State to the Chargé in Iran (Engert)
35. Your 54, March 28, 11 a.m. Please place the following considerations before the representatives of the Board:
- 1.
- As the Mission is not a profit-making organization, the minimum terms of a fair settlement might include cost including, of course, any improvements, plus damages or expenses resulting from the transfer of the properties, together with satisfactory provisions for prompt and effective payment.
- 2.
- The initial request of the Mission for compensation at market value would appear to have been amply justified as a starting point. However, the delay granted by the Iranian authorities for negotiations is rapidly running out, and since the passage of time tends to strengthen the tactical position of the Iranians, it appears unlikely that they will be the first to suggest a compromise solution.
- 3.
- In the last resort a claim founded in international law might be presented on the basis of market value after local legal remedies are exhausted and provided a denial of justice has occurred. But it might be difficult in practice to establish the inadequacy of any offered price owing to the circumstance that the market for such buildings is virtually restricted to the Iranian Government.
The foregoing is of course for communication to the Board representatives only. In any note which you may address to the Foreign Office at this time you should confine your remarks to an expression of the interest with which this Government has been following the course of the negotiations, of its regret that thus far no substantial progress has been made, and of its earnest hope that an equitable settlement will be reached in the near future.