Complex sentence: Whether or not this affected sovereignty over the islands is disputed as the British claim that the mutual agreements made between Spain and England only stipulated that neither party should establish any settlement on the coasts or adjacent islands of South America already held by Spain.
Split into simpler sentences: Whether or not this affected sovereignty over the islands is disputed. The British claim that the mutual agreements made between Spain and England only stipulated that neither party would make no further establishments on the coasts or adjacent islands already held by Spain.