838.51/1687
The French Ambassador (Jusserand) to the Secretary of State
Mr. Secretary of State: Your Excellency was pleased to let me know on the 12th of May of last year4a that the Government of the United States thought it must side with the Government of Haiti with regard to the payment of the interests and amortization of the gold loan of 1910, which is now effected in paper, and did not share the opinion of the Bank of the Union Parisienne, according to which the sums appropriate for such payments must be paid in gold francs.
[Page 295]My Government, to which a copy of the above-mentioned note from Your Excellency was forwarded, instructed the Embassy some time in January last to inform the State Department that under those conditions the Bank of the Union Parisienne asked to have the difference which had arisen between the French bondholders and the Haitian Government referred to arbitration in accordance with the positive provisions of article 30 of the contract for the issue of the loan, and that the French Government approved such a proceeding.
The Chief of the Division having the matter in charge in the Department of State, with whom the matter was broached in that sense, answered that the question whether under the terms of the loan contract the said bank would be justified in asking arbitration had been looked into previously and that the American Government had expressed to the Haitian Government the opinion that the holders of the bonds of that loan, not being a party to the contract, were not competent to resort to such proceeding.
Since then my Government has heard that the Government at Port-au-Prince had not failed, after consulting with the American Financial Adviser, to reject the request for arbitration and declare that its rejection of the request of the French bondholders was final.
In compliance with instructions just received on the subject, I have the honor to inform Your Excellency that the Government of the Republic finds it impossible to accept the refusal of Haiti. There is no question indeed that a contract was entered into by Haiti and the Bank of the Union Parisienne and that the contract expressly provides for arbitration as a means to adjust “disputes that might arise concerning its execution.” Whether the claims of the bondholders to the amount to be paid in gold are well- or ill-founded is not the question now at stake. The arbitrators are to pass upon that point. It is merely a question of procedure which is clearly regulated by the contract signed by the Haitian Government and the execution of which it could not evade in law or equity. It is further proper to note that the Bank of the Union Parisienne does not act in the case as the institution in charge of the financial service of the loan but in its capacity as the bank which issued the 1910 loan and is therefore responsible to the bondholders for the conditions of payment.
My Government, therefore, holding that the intervention of the Bank of the Union Parisienne is fully warranted, instructs me once more to intervene with Your Excellency in order to have the question reexamined with a view to a mode of settlement, which the French interested parties have surely a right to expect and which has never been held to be in disfavor with the American authorities. My Government would be very glad to hear that, taking into consideration [Page 296] the foregoing remarks, Your Excellency will be pleased to direct that new instructions be sent to the American Financial Adviser at Port-au-Prince.
Be pleased [etc.]
- File translation revised.↩
- Foreign Relations, 1923, vol. ii, p. 415.↩