(c) All other claims of nationals of either country, which arose subsequent to January 1, 1927 and prior to October 7, 1940, and involving international responsibility of either Government towards the other Government as a consequence of damage to, or loss or destruction of, or wrongful interference with the property of the nationals of either country.

ARTICLE II

The Government of the United States of America and the Government of the United Mexican States agree that the following claims are not extinguished in consequence of the stipulations of this Convention;

(a) Claims of nationals of the United States of America against the Government of the United Mexican States, which arose subsequent to August 30, 1927, and are predicated upon acts of authorities of the United Mexican States in relation to petroleum properties, which claims are the subject of a special agreement;

(b) Claims of nationals of the United Mexican State against the Government of the United States of America, which were formally presented to the Government of the United States of America by the Embassy of the United Mexican States in its note number 2705 of May 16, 1941;

(c) Claims of nationals of either country, predicated upon injuries essentially personal, which arose subsequent to January 1, 1927 and prior to the date of the signing of this Convention;

(d) Claims of the nationals of either country, of the character of those included in paragraphs (b) and (c) of Article I of this Convention, which arose subsequent to October 7, 1940 and prior to the date of the signing of this Convention; and (e) Claims of nationals of the United States of America predicated upon default in the payment of the principal or of interest on bonds issued or guaranteed by the United Mexican States, which were not filed with the Commission established pursuant to the Convention signed September 8, 1923.

The claims included in paragraphs (b), (c), and (d) of this Article will be the subject of future agreements which the two Governments will conclude as soon as possible.

ARTICLE III

The United States of America and the United Mexican States, in virtue of the stipulations of this Convention, reciprocally cancel, renounce, and hereby declare satisfied all claims, of whatsoever nature, of nationals of each country against the Government of the other, which arose prior to the date of the signing of this Convention, whether or not filed, formulated or presented, formally or informally to either of the two Governments, except those claims which are included in Article II of this Convention.

The two Governments agree that, with respect to international obligations and rights of each Government towards the other, the stipulations of this Convention supersede the stipulations of the General Claims Convention signed September 8, 1923, and those of the Protocol signed April 24, 1934, ['] which refers to that Convention, and those of the Agrarian Claims Agreement effected by exchange of notes signed November 9 and 12, 1938.

ARTICLE IV

There is credited against the sum of $40,000,000.00 (forty million dollars, United States currency) mentioned in Article I of this Convention the sum of $3,000,000.00 (three million dollars, United States currency), the total sum of payments made, prior to the signing of this Convention, to the Government of the United States of America by the Government of the United Mexican States pursuant to the Agreement in relation to agrarian claims, effected by the exchange of notes signed November 9 and 12, 1938. There shall also be credited the additional sum of $3,000,000.00 (three million dollars, United States currency) which will be paid on the date of the exchange of ratifications of this Convention.

The balance of $34,000,000.00 (thrity-four million dollars, United States currency) shall be paid by the Government of the United Mexican States to the Government of the United States of America at Washington, in annual instalments, beginning one year after the date of the signing of this Convention, of 1 [Executive Agreement Series 57; 48 Stat. 1844.]

$2,500,000.00 (two million, five hundred thousand dollars, United States currency) until the complete liquidation of this debt. The Government of the United Mexican States may, in its discretion, for the purpose of reducing the period for complete liquidation of the balance due, increase the amount of any of the annual instalments, or pay any such instalment or instalments in advance.

In consideration of the stipulations of this Convention it is agreed that the United Mexican States is relieved of the obligation to make further payments pursuant to the provisions of the Agreement in relation to agrarian claims effected by the exchange of notes signed November 9 and 12, 1938.

ARTICLE V

In the event of failure to pay any annual instalment, or instalments, when due, the United Mexican States shall pay interest at the rate of one per centum per annum on the amount of each such instalment, or instalments, from the date when the instalment, or instalmnents, became due up to the date of the payment.

ARTICLE VI

This Convention shall be ratified and shall become effective upon the exchange of ratifications which shall take place at Washington as soon as possible.

IN WITNESS WHEREOF, the respective Plenipotentiaries have signed and affixed their seals to this Convention.

DONE in duplicate, in English and Spanish, at Washington, this nineteenth day of November, 1941.

[SEAL] CORDELL HULL
[SELLO] F. CASTILLO NÁJERA

And whereas, the said Convention has been duly ratified on both parts, and the ratifications of the two Governments were exchanged at the city of Washington on the second day of April, one thousand nine hundred and forty-two;

Now, THEREFORE, be it known that I, Franklin D. Roosevelt, President of the United States of America, have caused the said Convention to be made public to the end that the same and every article and clause thereof may be observed and fulfilled with good faith by the United States of America and the citizens thereof. IN TESTIMONY WHEREOF, I have hereunto set my hand and caused the seal of the United States of America to be affixed.

DONE at the city of Washington this ninth day of April, in the year of our Lord one thousand nine hundred and forty-two, and of the Independence of [SEAL] the United States of America the one hundred and sixty-sixth. FRANKLIN D ROOSEVELT

By the President:

SUMNER WELLES

Acting Secretary of State.

EXHIBIT D

First Memorandum of William H. Dunn

We take the position that the determinations by the commissions under the General Claims Convention adopted on September 8, 1923, should be paid forthwith by the United States; that this should be done because it has a moral if not legal obligation to so do. We submit that our contention finds full and specific support in the recorded views of this committee.

On January 5, 1938, Mr. Pope, for the Committee on Foreign Relations, submitted a report on the matter, Senate Report 1600, Seventy-fifth Congress, third session, wherein the committee recommended a bill for passage. The bill S. 3104 was rewritten by the committee. It passed the Senate but was not acted upon by the House. The language of the report is illuminating. Excluding matters not now pertinent it says:

"In an effort to reach a satisfactory understanding respecting questions at issue between the United States and Mexico, and looking to the resumption of diplomatic relations between the two countries, President Harding, on May 2, 1923, appointed two American Commissioners to meet with two Mexican commissioners, and conferences were held in Mexico City from May 14 to August 15, 1923. These diplomatic negotiations resulted, among other things, in an agreement for a Special

Claims Convention providing for the settlement of claims of American citizens arising from revolutionary acts in Mexico from November 20, 1910, to May 31, 1920, and a General Claims Convention providing for the settlement of claims of citizens of each country against the other originating since July 4, 1868, except those claims covered by the Special Claims Convention. At the final meeting of the Commissioners on August 15, 1923, it was stated on behalf of both Governments that the Special and General Claims Conventions, the terms of which had already been agreed upon, would be consummated in the event that diplomatic relations were resumed between the two Governments. Such diplomatic relations were resumed September 3, 1923, and later ratified by the Senate and by the President, and the General Claims Convention was proclaimed by President Coolidge March 3, 1924.

"The General Claims Convention provided in article I that all claims of citizens of the United States against Mexico, except those arising from acts incidental to recent revolutions, for losses or damages suffered by persons or by their properties, and all such claims by citizens of Mexico against the United States of America, should be submitted to a commission consisting of three members for decision in accordance with the principles of international law, justice, and equity; and article V of the convention provided that

""The high contracting parties, being desirous of effecting an equitable settlement of the claims of their respective citizens thereby affording them just and adequate compensation for their losses and damages, agree that no claim shall be disallowed or rejected by the Commission by the application of the general principle of international law that the legal remedies must be exhausted as a condition precedent to the validity or allowance of any claim.'

."Under article VI of the convention all claims accruing prior to the signing of the convention had to be filed with the General Claims Commission within year from the date of its first meeting unless satisfactory reasons for delay existed, in which case the period might be extended not to exceed 6 months; and article VIII of the convention provided that such claims not so filed with the Commission should 'be considered and treated as fully settled, barred, and thenceforth inadmissible.'

"The effect of these provisions of the convention was to compel the citizen to turn his claim over to the Government for presentation to the Commission to keep the claim from becoming barred or noncollectible; and such turning of the claim over to the Government involved, as held by the Commission in the case of William Parker, Commission Docket 127, the surrender by the citizen of all right of control over the claim and vesting in the Government the absolute and exclusive right to control it, and to 'exercise an untrammeled discretion in determining when and how the claim shall be presented and pressed, or withdrawn or compromised, and the private owner would be bound by the action taken.' The Supreme Court has also recognized that 'no nation treats with a citizen of another nation except through his Government' (Frelinghuysen v. Key, 110 U. S. 63)."

Continuing the report, after dealing with articles VI and VII of the convention,

says:

"From all these provisions it appears evident that it was contemplated at the time the convention was entered into that all claims filed would be decided within the 3-year term fixed for the life of the Commission, plus such additional time as might be found necessary to finish deciding claims filed with the Commission which originated after the signing of the convention. And the fact that citizens turned their claims over to the Government for settlement under such a program cannot be overlooked in determining the right of a citizen given an award to have such award now paid."

Then noticing the work of the General Claims Commission, as extended, from August 30, 1924, to October 31, 1937, and the status of matters at the latter date and references to the convention of 1923 the report continues, viz:

"Article IX of the convention of September 8, 1923, relating to the settlement of awards, is as follows:

""The total amount awarded in all cases decided in favor of the citizens of one country shall be deducted from the total amount awarded to the citizens of the other country, and the balance shall be paid at Washington or at the City of Mexico, in gold coin or its equivalent, to the Government of the country in favor of whose citizens the greater amount may have been awarded.'

"As it was not known at the time the convention was entered into which Government would be adjudged to be entitled to the larger amount, and as each Government is required by the foregoing provision to appropriate any award

made in favor of its citizens to offset awards made in favor of the citizens of the other Government, it must have been contemplated that each Government would settle with its own citizens in respect of awards made in their favor. Such interpretation has been approved before the committee by representatives of the State Department.

"The committee considers that the convention, under a fair interpretation of all of its provisions, means that the United States undertook to have adjudicated the claims of its citizens against Mexico, and to collect awards that might be allowed thereon and to make settlement with its citizens therefor, and it further undertook to do this within the named and specified time, and for this purpose required its citizens to turn over to it such claims. The United States is, therefore, under at least a moral obligation to pay to its citizens who cooperated in that program the awards allowed them on claims thus turned over to the Government for such purpose.

"Inasmuch as the United States is thus morally obligated in the matter of such awards, and the citizens holding them have already waited years for their payment, and many, if not all, of them are in financial distress and urgently need the money represented by the awards in their favor, the committee feels that it is the duty of the Government to take affirmative steps at this time toward paying them, and thus affording them that 'just and adequate compensation for their losses and damages' declared by article V of the convention to be the purpose for its execution."

The committee recognizes that the United States was seeking for the Government and its citizens at large substantial benefits in the negotiation of the claims conventions in 1923. Diplomatic relations were restored at that time and all the benefits of renewed commerce and customs revenues were realized thereby. Citizens of the United States holding claims against Mexico having cooperated in that program, and the Government and its citizens generally having obtained the benefits sought therein, it is only fair that the citizens having such claims should be now paid for the awards that had been allowed thereon.

The committee recognizes that there is sufficient precedent for payment of the American awards in full at this time, inasmuch as nearly 100 years ago, under the convention of April 11, 1839, between the United States and Mexico, the liquidated or adjudicated claims of the Commission then established were later paid by the United States before collection had been made from Mexico, and the treaty between the two Governments signed at Guadalupe Hidalgo on February 2, 1848, obligated the United States as part of the consideration for the territory then acquired from Mexico to pay the unpaid balance of the awards in favor of American citizens and to liquidate the unadjudicated claims of our citizens which had not previously been disposed of.

Mr. Chairman you will recall that the committee's report on the bill above mentioned was adopted by the succeeding Congress in Senate Report No. 3, Seventy-sixth Congress, first session. In this report, the chairman, Mr. Pittman, embodied all of the language of the earlier report in support of the new bill S. 326. It was submitted and passed. But again the House did not act and you now have the bill of this Congress before you.

Second Memorandum of William H. Dunn

We advocate that claims which have been determined under the provisions of the General Claims Convention of September 8, 1923, should be paid forthwith by the United States, particclarly because of the settlement expressed in the convention of November 19, 1941.

In this position we are supported by the terms of the 1923 convention read in conjunction with the convention of 1941.

We believe that the United States, in accepting money and promises to pay as seen in the 1941 convention, has completed in part, if not completely, the collections from Mexico pursuant to the 1923 convention for the purposes therein stated, and that the duty now rests on Congress to authorize the payment of awards determined thereunder, by making proper adjustments on awards of funds now in hand from Mexico and adequate authorization for payment of any differences between that portion of the funds in hand and the appraisals upon which awards will be made in due course. (The said authorizations being subject to appropriations in the regular-or "deficiency" form from time to time as the need for payment shall arise.)

The printed records of the actions of the State Department since 1923 and later of the congressional committees all show of a diligent effort to do substantial justice to the claimants. These records also set out clearly the fact that the 1923 convention was based upon a desire to remove many international difficulties between Mexico and the United States. It may reasonably be deduced therefrom that the lawless condition of Mexico for the 10 years ending in the year 1920 or thereabouts, largely produced and in fact was the main purpose of the convention which in turn gained substantial benefits to the Government and the citizens of the United States. This convention assured just compensation for the aggrieved citizens. This was the dominant objective of the convention.

But this dominant objective has not yet been accomplished. In turn, the collateral objectives and advantages of the convention were immediately set in motion with the signing. That is to say relations were resumed between the two countries with attendant economic, social, and other benefits to all of the citizens of the United States. In other words, the aggrieved citizens of the United States won their cause but lost their case. Judgments have not yet been paid. The aggrieved citizens, resident sometime in Mexico, surrendered valuable rights under the terms of the 1923 convention and other rights were destroyed. Payment of their claims within approximately 3 years was a condition precedent to the realization of the objectives of the convention. It contemplated reasonably prompt payment by the United States of their approved claims. But this was not done. It has not yet been done-19 years after-insofar as the merchant W. A. Parker is concerned.

As shown by the early part of the records the payments by the United States to its citizens of their adjudicated claims was a primary obligation of the convention for considerations which they had surrendered. It is submitted that there is now no justification by the United States to avoid this obligation. The records show that ample consideration passed. And because of the record we feel fully justified in now asking Congress to adjust the error. In the Seventy-fifth and Seventy-sixth Congresses this committee was of the opinion that the determined claims should be paid and the Senate confirmed the view. It should not withhold similar action now. Ample precedent exists for immediate payment, as appears in the reports of the Senate Reports Nos. 1600, Seventy-fifth Congress and No. 3, Seventy-sixth Congress.

The fact that many of the general claims are not yet adjudicated should not prevent payment of those claims in which determinations have been made within the provisions of the convention, as extended. The unadjudicated items would be paid in due course under the authorization proposed in the premises.

WILLIAM H. DUNN, Washington, D. C., July 20, 1942. Re: Hearings on S. 2528, a bill to provide for the settlement of claims against the United Mexican States.

The Hon. ELBERT D. THOMAS,

The Senate, Washington, D. C.

DEAR SENATOR THOMAS: At the last sitting of the subcommittee you admitted, for the record, the opinion of the court, wherefrom it was stated it would be seen "that the claims were against Mexico" * * Undoubtedly, at the date of

the opinion, that was so.

Earlier in the hearings I had advanced the view that the provisions of the convention, proclaimed on April 2, 1942, read in conjunction with the General Claims Convention of 1923 now made the claims a liability of the United States. In support of this position, I beg to invite your attention to article III of the 1942 convention:

"The United States of America and the United Mexican States, in virtue of the stipulations of this convention, reciprocally cancel, renounce, and hereby declare satisfied all claims, of whatsoever nature, of nationals of each country against the Government of the other, which arose prior to the date of the signing of this convention, whether or not filed, formulated, or presented, formally or informally, to either of the two Governments, except those claims which are included in article II of this convention."

I venture to suggest that in the light of the foregoing that a declaration of liability should find a place in the bill. Awardees would then have something