837.51 Cooperation Program/76

The Ambassador in Cuba ( Messersmith ) to the Secretary of State

No. 2027

Sir: I have the honor to acknowledge the receipt of the Department’s instruction No. 642, May 10, 1941, in which reference is made to my despatch No. 1914, of April 20, 1941, and to its enclosure, a copy of the Cuban Government’s memorandum of April 15 with regard to Export-Import Bank credits for agricultural diversification [Page 167] and development and for public works. The Department refers in particular to the statement in Item 8 of the Cuban Government’s memorandum to the effect that the Cuban Government has “no information in regard to any appreciable or important claim made upon the Government of Cuba by any American citizen, that has not been settled, with the exception of the Morris claim.” The Department, in this connection, requests the Embassy’s comments on its instruction No. 401, of December 30, 1940,78 transmitting three lists of claims of American nationals against Cuba.

I have given instruction No. 401 considerable thought, and submit the following recommendations concerning the three lists of claims of American nationals against the Cuban Government transmitted with that instruction:

(1) I consider that the Morris claim, which involves a judgment of the Cuban Supreme Court, which has been actively pressed by the Embassy during the last several years, and the payment of which has been discussed with the Cuban Government in connection with possible financial assistance by the United States, should continue to be pressed, and that the financial assistance which the Export-Import Bank is prepared to extend to Cuba should be predicated on an arrangement concerning this claim satisfactory to both parties. Such arrangement need not, however, contemplate immediate payment in full.

(2) I do not believe that the Government of the United States should, in general, act as a collection agency or otherwise become involved in the collection of current accounts against the Cuban Government by public service corporations or by other suppliers of commodities. Such public service companies and other suppliers customarily have their own methods of settling their differences with the Cuban Government, and I believe that the responsibility for maintaining their current business with the Government on a satisfactory basis should be left entirely to the officials of those companies. This is without prejudice to the possible desirability of the Embassy’s giving such informal assistance to these persons or interests as may appear to be advisable in particular circumstances.

(3) I do not believe that the United States Government should revive any claim which is not at present being actively pressed by the claimants and make the payment of that claim a condition precedent to the granting of financial assistance to the Government of Cuba. The financial situation of the Cuban Government is not good. I believe that the Government is making an honest effort to improve that situation, and the financial help that we are able to give Cuba will be [Page 168] of material aid in this connection. It is as much in the general interest of the United States as it is in the interest of Cuba that such financial help should be given, and it is not in the general interest of the United States that the granting of such general help should be predicated on the Cuban Government’s action in the case of a particular claim which might or might not turn out to be meritorious. I am not excluding in this connection claims in connection with which the claimant may have been able to get certificates or other evidence from the Cuban Government acknowledging the particular debt involved.

I particularly recommend that the Department take no action in connection with the claim of the United States Treasury Department in the amount of $798,055.27. This claim, it will be recalled, represents two judgments rendered by the Cuban Supreme Court in favor of the Cuba Cane Sugar Corporation which were assigned in part to the United States Treasury Department, to be applied against income taxes owed by the Cuba Cane Sugar Corporation to the United States Government.

It will be recalled in this connection that the Department of State was opposed to the Treasury Department’s accepting this claim in lieu of income taxes owed to the United States Government. It is not believed that the Cuban Government gave its consent to the procedure, and the Embassy perceives no moral basis on which it could approach the Cuban Government with the request that the judgments in favor of the Cuba Cane Sugar Corporation be paid to the Treasury of the United States. For the Department to try to collect this debt, incurred by the United States Treasury Department gratuitously and without the consent of the Cuban Government, would tend seriously to prejudice our moral position in Cuba.

(4) I recommend that under no circumstance should any claim included in List 3 be brought to the Cuban Government’s attention at this time or in any way connected with the proposed financing by the Export-Import Bank. Many of these alleged claims should have a statute of limitation applied to them. Others obviously are in the category of claims which the Department formerly did not hesitate to sponsor, but which it would not agree to sponsor today.

If the Department approves the foregoing, which I consider eminently reasonable and just, the Embassy will not be under the necessity of raising with the Cuban Government, in connection with the proposed financing by the Export-Import Bank, any claim other than the Morris Claim.

Unless I receive instructions to the contrary, I shall act on the foregoing basis. I shall, of course, at an appropriate opportunity in the near future, in accord with the last paragraph on page two of the Department’s instruction, inform the Minister of State of our [Page 169] satisfaction with the many cooperative measures which the Cuban Government has taken, and reiterate our expectation that the Cuban Government will give consideration to the satisfactory settlement of the legitimate claims of American nationals.

Respectfully yours,

George S. Messersmith
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