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(Inclosure in No. 134–Translation.)

Mr. Fontecilla to Mr. McGarr.

REPUBLIC OF CHILE,
MINISTRY OF FOREIGN RELATIONS,

Santiago, May 31, 1894. SIR: Relative to your note of the 11th of April last, I have the honor to inform you that a conference having taking place in Washington at the invitation of the honorable Secretary of State to the diplomatic representative of Chile, and they having exchanged views upon the matter to which your note alludes, I have agreed to conduct at your capital the negotiations referred to.

Advising you that proper and timely instructions will be given to the plenipotentiary of Chile in the United States, I avail myself with pleasure of this occasion to renew to you the assurances of my distingushed consideration.

M. SANCHEZ FONTECILLA.

Mr. Gana to Mr. Gresham,

[Translation.)

LEGATION OF CHILE,

Washington, July 28, 1894. SIR: I have the honor to inform your excellency that I have received a communication from the minister of foreign relations of Chile, in which, referring to the claims which were not decided by the commission that sat at Washington up to the 9th of April last, he authorizes me to submit to your excellency's consideration the question of adjusting them by means of an arrangement, for which the pro rata existing between the amounts claimed and those awarded by the aforesaid commission might be taken as a basis.

My Government adds that a similar arrangement has been adopted to mutual advantage by France, Great Britain, Italy, Portugal, AustriaHungary, Belgium, and, lastly, by Spain, with a view to reaching a final settlement of the claims against Chile which were not adjusted by the international commissions that sat at Santiago in 1884.

Hoping that your excellency will take this suggestion into kind consideration, I take pleasure in renewing to you the assurances, etc.

DOMINGO GANA.

Mr. Gresham to Mr. Gana.

DEPARTMENT OF STATE,

Washington, August 13, 1894. SIR: I have the honor to acknowledge your note of the 28th ultimo, submitting the suggestion of your Government that the claims not decided by the American Chilean commission, which recently sat at Washington, be adjusted by paying such an amount of the face of such claims as the aggregate amount awarded by the commission on claims which they did consider bears to the face amount of the latter claims. In reply I have the honor to say to your excellency that this Govern. ment does not feel warranted in consenting to such an arrangement. It thinks that each and every claim should be examined and settled upon its merits, by an international commission.

Accept, Mr. Minister, the renewed assurance of my highest consideration. I am, etc.,

W. Q. GRESHAM.

Mr. Gana to Mr. Gresham.

[Translation.]

LEGATION OF CHILE,

Washington, August 16, 1894. SIR: I have the honor to acknowledge the receipt of your excellency's note of the 13th instant, in which your excellency is pleased to inform me that his Government does not consider itself authorized to assent to the proposition of adjustment which in the name of my Government was submitted to your excellency on the 28th ultimo, as a means of terminating satisfactorily the claims which were left unsettled by the commission which held its sessions in this capital from the 9th of April last.

I have hastened to transmit your excellency's communication to my Government, which will doubtless regret that it can not count upon the acceptance by the Government of your excellency of an arbitrament which, in its opinion would, under the present circumstances, be the most adequate for the settlement of existing claims. I avail, etc.,

DOMINGO GANA.

Mr. Gana to Mr. Gresham.

LEGATION OF CHILE,

Washington, November 15, 1894. SIR: My Government has carefully considered the contents of your excellency's esteemed note of the 13th of August last relative to the reciprocal claims still undecided between the two countries, and it has instructed me to submit to your excellency certain considerations which it feels confident will be received in the same friendly spirit that has dictated them.

My Government thinks that, in view of the number of the claims and their nature, it would be more practical and less expensive to settle them directly, either by means of a gross sum embracing all the claims collectively, or by means of an examination which would render it possible to eliminate those that are without foundation, and to pay the others by means of a compensation based upon a spirit of amicable equity.

It would not be difficult to find precedents, as your excellency is aware, that would warrant the adoption of either of the methods proposed. I have had the honor to state to your excellency that the principal nations of Europe have settled difficulties of the same kind which they had with Chile by means of collective arrangements for a conventional amount. The United States Government has also had recourse to the same amicable means for the settlement of claims which formerly existed with Denmark, France, Peru, and Spain.

The second method, viz, a previous examination of the claims with a view to the elimination of those which have no reasonable foundation, and to settling such as may be found just by the payment of a suitable compensation, is daily resorted to by all Governments in their relations with one another.

It will be sufficient for me to call attention to the fact that your excellency's Government made no objection whatever to the adoption of this latter method before the conclusion of the convention of August 7, but that, on the contrary, it was prepared to accept and second it with decided interest. In the note addressed under date of September 30, 1890, by Mr. Egan, then United States minister plenipotentiary, to the minister of foreign relations, that gentleman wrote as follows:

In an interview which I had the honor to have with His Excellency the President of the Republic relative to the claims of citizens of the United States against the Government of Chile, his excellency was pleased to suggest the propriety of furnishing data with respect to all those claims, with a view to reaching a speedy investigation of the grounds on which they were based, and an amicable settlement, either by means of a direct arrangement or by submitting the case to arbitration.

In accordance with this suggestion, and being actuated by the spirit of sincere friendship which happily characterizes the relations existing between the two countries, I have the honor to send your excellency, for the information of your Government, a list of these claims, together with a brief statement with regard to the nature of each.

After enumerating the said claims Mr. Egan ended his communication as follows:

I can assure your excellency that my Government has no desire to support any claim that does not appear to be founded upon right and justice; and at the same time I entertain the fullest confidence that the Government of Chile will give proper attention to all claims that are found to be just and meritorious, and that it will pay them in full. I consequently desire here to state that whenever your excellency's Government may think proper to proceed to an investigation of the above-mentioned claims I shall take great pleasure and shall deem it my duty to cooperate, by the exhibition of the documents concerned and in any other way, in throwing all necessary light upon the grounds of each one of the claims.

These antecedents and the amicable spirit which happily governs the relations between the two Governments lead that of Chile to entertain the well founded hope that your excellency's Government will be willing to take into kind consideration either of the two suggestions which I have the honor to lay before you. I avail, etc.

DOMINGO GANA.

Mr. Gana to Mr. Gresham.

LEGATION OF CHILE, Washington, November 15, 1894. (Received November 15.) Sir: I duly transmitted to my Government the contents of the communication which your excellency did me the honor to address to me under date of the 9th of July last.

In reply, the minister of foreign relations informs me that there has doubtless been a misunderstanding in the reports transmitted to your excellency with regard to the willingness of the Government of Chile

to settle, by means of a new commission, the reciprocal claims which the former commission left undecided.

The minister adds that neither in the correspondence of the Govern. ment of Chile with the United States chargé d'affaires, nor on any occasion subsequent to the conclusion of the convention of August 7, 1892, has that Government consented to the organization at Washington of a new tribunal of arbitration for the purpose mentioned.

The minister sends me, at the same time, a copy of the correspondence had on this subject with the American legation at Santiago, from which, as your excellency may see by the accompanying documents, the sense in which it seems to have been understood by the United States representative in Chile is in no wise deducible. I avail, etc.,

DOMINGO GANA.

Mr. Gresham to Mr. Gana.

DEPARTMENT OF STATE,

Washington, December 22, 1894. SIR: I received in due course your note of the 15th ultimo, in which, having reference to the matter of completing the settlement of the claims between the United States and Chile, which was interrupted by the adjournment of the late Mixed Commission without action upon a number of cases duly presented under the convention of August 7, 1892, you communicate the statement of the minister of foreign relations that there has doubtless been some misapprehension in the reports made to this Department regarding the willingness of the Government of Chile to dispose of those unadjusted claims by a new convention. His excellency declares that Chile never, either in its correspondence with the chargé d'affaires of the United States or on any other occasion subsequent to the convention of 1892, agreed that a new convention be organized at Washington for that purpose. In support of this view you inclose copies of the correspondence on the subject with our legation at Santiago.

On April 11, 1894, Mr. McGarr wrote asking whether the Chilean Government would consent to sign another convention for the creation of another commission for the purpose mentioned. Señor Bascuñan acknowledged this April 16, promising timely communication of the conclusion which should be reached in the matter. Later, on May 31, 1894, his excellency further answered Mr. McGarr's note of April 11, saying that in view of conferences between the Chilean minister at Washington and the Secretary of State, he, Señor Bascuñan, “ had agreed to conduct in this capital (Washington] the negotiations to which the said note refers." The negotiations referred to in Mr. McGarr's note were stated to be for 5 another convention for the creation of another commission," and this, also, was the proposal considered by you and me in the conferences to which his excellency adverts as having led him to the announced agreement to negotiate further in Washington. I submit that the impression formed by this Government respecting the intentions of your own was reasonably deducible from these premises, especially as the only point of essential disagreement developed in my preceding conferences with you concerned the place where the new commission should sit, you favoring Santiago and Washington. See inclosures in No, 118, page 88; in No. 121, page 89; in No, 134, page 90,

However this may be, it is evident that your note shows a misunderstanding between the two Governments, not as to the necessity of dis. posing of the unfinished work of the late commission, as to which both are in accord, but as to the proper manner of accomplishing that necessary result.

I have no reason to change the views I have so often expressed to you and otherwise made known to your Government, that the natural and reasonable way is to carry to completion the adjustment begun under the operation of the convention of 1892. The reasons wbich induced the two Governments to come to an agreement then for a commission to sit at Washington, apply now with even greater force. The evidence in the undecided cases laid before the tribunal is carefully preserved here, and it would not be fair to the claimants of either Government to revert at this interrupted stage of the proceedings to methods of settlement which at the outset were considered and abandoned. If the unfinished cases are not disposed of by a commission it is believed that the controversy between the two Governments will be prolonged indefinitely.

Having once adopted arbitration as an honorable mode of adjustment, it behooves the two friendly Governments to adhere to it to its legitimate end. Failure to do so now, when the work is more than half done, can but discredit the labors of the late honorable commission and detract from the high example our Governments have set by advocating and accepting arbitration to end their differences. The organi. zation of a new commission should be as easy as its task would be brief.

I am, therefore, directed by the President, to whom the whole matter has been referred, to lay the foregoing considerations before the Government you so worthily represent, and urge that it join with ours in giving full effect to the methods stipulated in 1892. Accept, etc.,

W, Q. GRESHAM.

AMNESTY TO POLITICAL OFFENDERS.

Mr. McGarr to Mr. Gresham.

No. 158.

LEGATION OF THE UNITED STATES,

Santiago, September 11, 1894. (Received October 24.) SIR: The Chilean Congress at its regular session, which expired on the 1st instant, passed a law of general amnesty comprehending all persons liable for acts of a political character, or growing out of the political condition of the country, done up to the 28th of August, 1891, and all Chileans liable for acts against the internal order of the State since the 29th of August of the same year.

While expressed in few and general terms, this act was designed especially, if not wholly, as one of oblivion or pardon for offenses charged to have been committed by many civil and military officers of Balmaceda's Government before and after the beginning of the revolutionary movement, and for offenses committed in the several attempts against the Government established since Balmaceda's overthrow. It removes the last exception to complete amnesty to all concerned in the civil war.

The act was promptly approved by the President, and a large number of prisoners, some under sentence, have been restored to liberty. I have, etc.,

OWEN MCGARR,

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