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of revenue or increase of the expenses of the Government shall be first voted by the Chamber of Representatives.”

In view of these Constitutional provisions, it seems to follow that the loan contract is a part of the law of ratification and that otherwise the contract would be invalid because it affects a subject of public interest, increases the expenses of the Government and therefore its provisions could only become binding upon the Haitian Government if enacted into law by legislation originating in the House of Representatives.

Furthermore, Article 70 of the Haitian Constitution of 1899 (1889] provides that "the authoritative interpretation of the laws belongs to the Legislative power alone. That interpretation shall be given in the shape of a law” and Article 35 of the Constitution provides "that the three powers, the legislative, the executive and the judicial are independent from each other in the exercise of their own functions, which they perform separately. Neither of them can delegate its faculties, nor go beyond the limits ascribed to it.”

Reading together the provisions of Articles 35 and 70 of the Constitution, it would appear that the provisions of such articles would prohibit the delegation to arbitrators of the construction of the law of ratification which incorporates the loan contract in question, and would have constituted an insurmountable obstacle to any attempt of the Haitian Government to bind itself in 1910 to submit to arbitration the interpretation of any of its laws. In this view of the matter it would seem that the arbitration clause of the loan contract so far as it relates to the interpretation of the contract and not merely to matters of detail in the execution thereof was void as beyond the powers of the representatives of the Haitian Government who entered into the contract.

Finally I beg to invite your attention to the fact that in a note of November 4, 1918 16 your Embassy forwarded to the Department a communication addressed to it by the Bank of the Union Parisienne and requested that, the facts therein set forth having been brought to the knowledge of the Government of the United States, this Government would endeavor to bring about appropriate measures leading to a solution acceptable to the French bondholders of the loan of 1910. In the communication from the bank transmitted by the Embassy occurs the following language:

“According to a note delivered by the National Bank of the Republic of Haiti a copy of which will be found herewith, enclosure 3, the proceeds of the customs duties set apart for the 5 percent gold loan of 1910 of the Republic of Haiti since September 1915 aggregates up to March 1918 $2,058,251., of which there was applied to the service

16 Not printed.

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of the loan in March 1916 not more than $164,000 so that there would remain a difference for settlement of $1,894,251.

"At the present rate of exchange this sum would represent in francs an amount sufficient to pay all of the outstanding coupons.”

It seems difficult to escape the conclusion that in transmitting to the Department the note last mentioned with the enclosed letter from the bank, which was done as stated in the note by the direction of your Government, the French Government and the bank must be considered as having acknowledged thereby that the 1910 loan of the Republic of Haiti was payable at the current rate of the franc and not in gold and I am therefore constrained to point out that the present position of your Government and of the bank in asking for arbitration on the point of the currency in which the loan is payable is inconsistent with the position as taken in the note of November 4, 1918. I may add that, relying upon that position, which seemed to it, as it does to the Government of the United States, to be entirely sound, the Haitian Government proceeded with its refunding arrangements accordingly, and that any action which would result in establishing that the Haitian Government was in error on this point would have a disastrous effect upon the financial and economic condition of the Republic of Haiti and would operate to counteract in great measure, the advance it has made in material prosperity in the past few years. To such a result, I am sure, your Government is far from wishing to contribute.

I am sure that you will understand that entertaining the views which are above expressed, I am unable to accede to your request for the exercise of efforts to induce the Haitian Government to accept the proposition for arbitration put forward by the Bank of the Union Parisienne. Accept [etc.]


838.51/1776 The Secretary of State to the High Commissioner in Haiti (Russell) No. 254

WASHINGTON, May 7, 1925. Sir: Referring to your despatch No. 459 of November 21, 1924,"? in relation to the request for arbitration on the question of whether the Haitian Loan of 1910 is payable in gold, the Department informs you that it has beeen asked by the French Embassy on behalf of the Banque de l'Union Parisienne to use its good offices in an effort to induce the Haitian Government to consent to such arbitration.

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After carefully considering the matter, the Department has definitely declined to grant this request of the French Government and has sent to the French Embassy a note embodying such refusal, a copy of which is enclosed for your information.18 I am [etc.]

For the Secretary of State:


18 Printed supra.




815.00/3527 : Telegram
The Chargé in Honduras (Dennis) to the Secretary of State
TEGUCIGALPA, January 21, 1925—8 a. m.

[Received 2:46 p. m.] 11. The National Assembly yesterday by legislative decree declared elected President of Honduras Baraona 2 with 72,021 votes and Vice President Quesada 8 with 72,011 votes. 78,491 votes cast in all.

Inasmuch as rumors are being circulated to the effect that the United States Government will not recognize the new government, or will do so only under onerous and humiliating conditions, I consider it desirable that the Legation be instructed at once to make to the Provisional Government with a view to publication an appropriate statement. The publication of such a statement would do much to avert troublesome Red * activities.


815.00/3527 : Telegram

The Secretary of State to the Chargé in Honduras (Dennis)

WASHINGTON, January 22, 1925—11 a. m. 9. Your No. 11, January 21, 8 a. m. You may make public the following statement:

"The Government of the United States is gratified that it has been possible to reach a solution of the problem of establishing in Honduras a constitutional government with which the Government of the United States and those of the other Central American republics can maintain cordial relations without inconsistency with the provisions of the General Treaty of Peace and Amity signed at the Washington conference of 1923. The Government of the United States contem

For previous correspondence concerning political affairs in Honduras, see
Foreign Relations, 1924, vol. II, pp. 300 ff.

Miguel Paz Baraona.
* Presentacion Quesada.
Liberal Party.

See Conference on Central American Affairs, Washington, December 4, 1922– February 7, 1923 (Washington, Government Printing Office, 1923), p. 287.


plates with pleasure the resumption of formal relations with the Gov. ernment of Honduras upon the inauguration on February 1st of the new constitutional authorities."


815.00/3535 : Telegram
The Chargé in Honduras (Dennis) to the Secretary of State

TEGUCIGALPA, January 24, 1925—8 p.m.

[Received January 25—12:36 a. m.] 13. Please instruct with regard to my participation in the inaugural ceremonies February 1st and as to form of extending recognition to the new constitutional government.


815.00/3535 : Telegram

The Secretary of State to the Chargé in Honduras (Dennis)

WASHINGTON, January 26, 1925—6 p. m. 11. Your January 24, 8 p. m. You may participate in the in

m augural ceremonies on February 1 in such manner as is customary in Honduras when a new constitutional government is to be inaugurated, and

you may thereafter make the customary official calls on the officials of the new government. If you deem it advisable you may also address a note to the new Minister of Foreign Affairs expressing this Government's gratification that it has now been possible to resume formal diplomatic relations with the Government of Honduras.




815.24/12: Telegram

The Secretary of State to the Chargé in Honduras (Dennis)


WASHINGTON, January 10, 1925—4 p. m.

4. Legation's January 7, 2 p. m.? Department has been considering Provisional President Tosta's request and will endeavor to ascertain whether War Department has available the supplies which

'For previous correspondence concerning political affairs in Honduras, see Foreign Relations, 1924, vol. II, pp 300 ff. *Not printed.

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