The Minister desired to take up the contents of my note No. 122,1 enclosure in despatch to the Department No. 163', dated November 13, 1912, which embodied the Department's instruction dated November 9.' The Minister stated that the Arbitral Tribunal of 1907-1908 had never rendered a decision. That the controversy at that time was settled by the contract of September 30, 1908, which was reached by direct agreement between the Government of Ecuador and the Railroad Company. This agreement was approved, with slight modifications, by the Ecuadorean Congress, November 6, 1908. The point which the Minister for Foreign Affairs wished to make was the following: Has the Railroad Company carried out its part of the contract of September 30, 1908, or has it failed in some of its obligations? The Minister stated that the Government of Ecuador was very desirous of having this question passed upon by the Arbitral Tribunal. If the Arbitral Tribunal decides that both the Government of Ecuador and the Railroad Company have complied with the stipulations of the contract of September 30, 1908, the other questions to be decided will be those of a date later than September 30, 1908; but if on the other hand either the Ecuadorean Government or the Railroad Company has failed to carry out the obligations imposed upon them by the above-mentioned contract, it is evident (according to the Minister) that these points can not be considered as being res judicata, and should be presented to the proposed Arbitral Tribunal for de cision. Therefore the Minister for Foreign Affairs informed me (Legation's telegram of December 14) that he had instructed the Ecuadorean Legation in Washington to request that the departure of Mr. Janes be delayed until receipt by mail of the note, copy and translation of which is enclosed herewith, by the Department, in order that Mr. Janes' instructions might be amplified, so that the Tribunal could pass upon the question of the fulfillment by the Railroad Company of its obligations under the contract of September 30, 1908. It is not felt that the Minister for Foreign Affairs of Ecuador has made the main point of his argument sufficiently clear in the note enclosed herewith. As the contents of this despatch was reached by the writer as the result of a long personal conversation with Mr. Dillon, it is hoped that it may serve to throw some light on the real feelings of the Government of Ecuador with regard to the proposed arbitration. I have [etc.] RUTHERFORD BINGHAM. No. 118.] [Inclosure-Translation.] MINISTRY OF FOREIGN RELATIONS, SIE: I have the honor to reply to your note No. 122 dated the 11th of last November, in which you state "that the Government of the United States cannot now regard as open for discussion matters involving the existence and validity of the fundamental contractual agreements between the Government of Ecuador and the Railway Company "; matters which, as you state, "were under discussion in a former controversy and were passed upon by the Arbitral Tribunal of 1907-1908, in an act having the status and value of an arbitral award, which has since not only been fully recognized but until the present time unquestioned by the Ecuadorean Government." Finally you add in the above-mentioned note that: "The status as to the fundamental agreements being thus, and the matters of present dispute between the Ecuadorean Governinent and the Company, as heretofore considered by the two Governments, having solely to do with the transactions between the Government of Ecuador and the Railway since September 30, 1908, the Government of Ecuador will perceive that the present proposed arbitration can have relation only to such latter matters and that in the discussion and decision thereof the status referred to must be accepted as a fundamental basis upon which to ground the determination of the questions involved." With reference to what I have quoted, I shall begin by stating certain ideas which I consider of the greatest importance: Regarding the arbitration, it is the President of the United States, individually, and not the Government of that Republic who possesses the character of Arbitrator, by reason of the contract entered into with the Railroad Company. Therefore I believe that the intervention of the North American Government in the matters treated of in this note can not be accepted. Therefore I can do no less than deplore that your judgment in this matter differs materially from the opinion of the Ecuadorean Government and that this discrepancy may result in the postponement of the settlement, which the Chief of the State greatly desires to conclude in the shortest possible time. In fact, theoretically as well as practically, the constitution of an Arbitral Tribunal whose members had not received ample and equal full powers for the discharge of their functions, would be unacceptable. The reasons which in your opinion have determined the President of the United States to restrict the powers of his representative are based upon this false idea that the difference between the Government of Ecuador and the Railroad Company previous to September 30, 1908, "were discussed and passed upon" by the Arbitral Tribunal of 1907-1908, it being the case that the said Tribunal, although it was properly constituted, did not pronounce any award, as appears from the evidence. These differences were arranged, it is true, but not by the Arbitral Tribunal above mentioned; they were arranged by the mutual agreement of September 30, 1908, approved with modifications by the Legislative Decree of November 6 of the same year: an adjustment which does not have the legal status peculiar to an arbitral award. The agreement is a contract, and bilateral contracts have the characteristic that they are null and void in case one of the contracting parties does not carry out his part of the agreement. It is not thus with arbitral awards, which have the character of finality or definitiveness independent of the accomplishment or non-accomplishment of the undertakings therein contained. In consequence, the only arrangement that exists between the Government of Ecuador and the Railroad Company, that is to say, the transaction of 1908, does not have the decisive character with which you desire to endow it in the note to which I am now replying. On the other hand, the discussion as to what shall constitute the matters which the projected Arbitral Tribunal shall decide I consider irrelevant because the Tribunal is the only authority empowered to determine them, without further limitations than those established by the mutual obligations of the parties, obligations which in this case are no other than the contract of June 14, 1897, between the Government of Ecuador and the Railroad Company. The powers of the Arbitrators should have the scope that is indicated by Article 27 of the above-mentioned contract. It is not the attribute of one only of the Arbitrators to determine in advance the matters that shall fall under the jurisdiction of all the Tribunal, because, in the exercise of its functions, not even the Tribunal itself can amplify or restrict the limits of the pact that gives it life. On account of what I have above set forth, I should appreciate it if you would suggest to His Excellency the President of the United States of North America the expediency of not limiting the juridical powers of his Delegate, in order that he may exercise them without restriction, whatever may be the claims of the Government of Ecuador or its disagreements with the Railroad Company, provided that these disagreements are those contemplated by article 27 of the contract of June 14, 1897. My Government considers it an indispensable condition for the perfect working of the Arbitral Tribunal that no one of its members have restricted powers, differing from the ample powers with which both Representatives should be invested, as the Representative of the Republic will in fact be invested. I avail [etc.] LUIS N. DILLON. File No. 422.11 G 93/573. The American Chargé d'Affaires to the Secretary of State. No. 175.] AMERICAN LEGATION, Quito, January 16, 1913. SIR: I have the honor to report that Mr. Henry L. Janes, American Arbitrator for the settlement of claims between the Government of Ecuador and the Guayaquil and Quito Railroad Company, arrived in Quito January 11, 1913. I have [etc.] RUTHERFORD BINGHAM. File No. 422.11G93/563. The Secretary of State to the American Chargé d'Affaires. No. 62.] DEPARTMENT OF STATE, Washington, January 21, 1913. SIR: The Department has received your No. 170 of the 16th ultimo, transmitting a note from the Minister for Foreign Affairs in regard to the proposed arbitration of the differences between the Government of Ecuador and the Guayaquil & Quito Railway Company, and reporting in regard to your interview with the Minister in which he stated that he had instructed the Ecuadorean Legation at Washington to request that the departure of Mr. Janes be delayed. Before replying, the Department will wait to hear from Mr. Janes, as requested by him. I am [etc.] P. C. KNOX. File No. 422.11G93/584. The American Chargé d'Affaires to the Secretary of State. No. 187.] AMERICAN LEGATION, SIR: I have the honor to enclose herewith duplicate copies and translations of notes numbered 202 and 212 from the Ecuadorean Foreign Office, dated February 7 and February 13 respectively. The latter one of the notes above mentioned informs the Legation that Dr. Baquerizo Moreno reached the capital on February 13. After the arrival of the Ecuadorean Representative, the next few days were taken up by an exchange of visits between the Arbitrators. As soon as this formality had been concluded the Legation addressed a note to the Foreign Office, No. 150, dated February 18, 1913, requesting the Minister for Foreign Affairs to designate the place and hour for the formal meeting of the two Arbitrators for the purpose of exchanging credentials and full powers. Copies of this note are also enclosed herewith. It is expected that the American Arbitrator will be sworn in by the President of the Supreme Court and that if no unforeseen difficulties occur the Arbitral Tribunal will be constituted in the course of a few days. I have [etc.] RUTHERFORD BINGHAM. [Inclosure 1-Translation.] The Minister for Foreign Affairs to the American Chargé d'Affaires. No. 202.] MINISTRY FOR FOREIGN AFFAIRS, SIR: I duly received your note No. 144 of the 1st instant in which you inform me that Mr. Henry L. Janes, who has been appointed by the President of the United States to represent him on the Arbitral Tribunal, which is to consider the disagreements that have arisen between the Government of Ecuador and the Guayaquil and Quito Railway Company, has arrived in this city. You ask me also in this note when Dr. Alfredo Baquerizo M., the Ecuadorean Arbitrator, will be in Quito. I have delayed in answering the mentioned communication, hoping that Dr. Baquerizo would send me news of his journey, which as you know has been de layed on account of personal matters that have prevented him from coming. Today, fortunately, I can announce to you that according to information I have just received Dr. Baquerizo will be in this city the early part of next week. I avail [etc.] [Inclosure 2-Translation.] C. CARRERA. The Minister for Foreign Affairs to the American Chargé d'Affaires. No. 212.] MINISTRY FOR FOREIGN AFFAIRS, SIR: Confirming my note No. 202, dated the 7th instant, it gives me pleasure to inform you that Dr. Alfredo Baquerizo Moreno, Representative of the President of Ecuador on the Arbitral Tribunal that is to take congizance of and decide all differences between the Government and the Railroad Company of the South, arrived in the Capital today. I avail [etc.] [Inclosure 3.1 C. CARRERA. The American Chargé d'Affaires to the Minister for Foreign Affairs. No. 150.1 AMERICAN LEGATION, Quito, February 18, 1913. MR. MINISTER: I have the honor to acknowledge the receipt of your excellency's esteemed note No. 212, dated February 13, 1913, in which your excellency informs me of the arrival in Quito of Dr. Alfredo Baquerizo Moreno, Ecuadorean Representative on the proposed Arbitral Tribunal, which is to consider points of difference that have arisen between the Government of Ecuador and the Guayaquil and Quito Railway Company. Both Arbitrators having now arrived in this city, I have the honor to suggest to your excellency the desirability of fixing the place and hour for the meeting of the Arbitrators and the formal exchange of their credentials and full powers. I avail [etc.] RUTHERFORD BINGHAM. File No. 422.11 G 93/592.. The American Chargé d'Affaires to the Secretary of State. No. 189.] AMERICAN LEGATION, Quito, February 22, 1913. SIR: I have the honor to report, with reference to my despatch No. 187, that the result of note No. 150, dated February 18, 1913, was a request from the Minister of Foreign Affairs to call at the Foreign Office for the purpose of discussing the contents of note No. 150 above mentioned. Dr. Carrera then informed me that he had not yet received a reply from the Legation to note No. 118, dated December 12, 1912 (enclosure in despatch No. 170, dated December 16, 1912) and desired some statement from the Legation with reference to the contents of this note before replying to No. 150, appointing a time and place for the formal meeting of the Arbitrators for the purpose of exchanging credentials and full powers. The point that Dr. Carrera seemed to have most in mind was the question of the scope of the powers granted to the American Arbitrator. He stated further that he had been informed by the Ecuadorean Legation in Washington that the Department of State had told Mr. Wither' that the powers granted to the American Arbitrator were unrestricted. The conference ended by Dr. Carrera requesting the Legation to reply to the note from the Foreign Office of December 12 last. The note in question contained so much controversial matter, on the subject of which the Legation had received no instructions, that after a consultation with Mr. Janes it was decided to ignore the contents of this note, with the exception of that part dealing with the powers of the American Arbitrator. Note No. 151, dated February 21, 1913 (duplicate copies enclosed herewith), was accordingly addressed to the Foreign Office, together with a certified copy of the authority under which Mr. Janes will act. I have [etc.] RUTHERFURD BINGHAM. [Inclosure.] The American Chargé d'Affaires to the Minister for Foreign Affairs of Ecuador. No. 151.] AMERICAN LEGATION, MR. MINISTER: With reference to the subject of the conversation with your excellency at the Ministry for Foreign Affairs yesterday morning, in which your excellency spoke of the character of the powers furnished by the President of the United States to the American Arbitrator authorized to represent him, in accordance with the terms of the contract between the Government of Ecuador and the Guayaquil and Quito Railway Co., dated June 14, 1897, I have the honor to enclose herewith a duly certified copy of the authority under which Dr. Janes will act. Your excellency will observe that this power is unrestricted and simflar in all respects to that furnished to the American Arbitrator in 1907. 1 Secretary of the Legation of Ecuador. 2 Not printed. |