Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-02-16

| way or action or else Virtually saying t.
| European governments that they would no
be allowed to collect their claims Thi
Wouid De an unfortunate attitude for thu
government of the United States to b,
forced to maintain at present. 1t canno
with propriety say that 1t will protect its
own citizens and-interests, on the one hand
and yet on the other hand refuse to allow
other governments to protect their citizens
| and interests. X
The actual situation d the Dominican re.
pubic cannot, perhaps be more forcibly
stated than by giyingAa brief account OF
the case OF the San Domingo Improve
ment Company.
| From 1860 to 1897 the Dominican govern
ment issued successive series of bonds the
majority Of which were in the hands OF
european holders. Successive issues bore
| interest at rates ranging from 2a4 to per
| cent, and what with commissions and 9TH
er deductions and the heavy discount in
| the market the government probably did
not receive over 80 to 10 per cent of
| thelr nominal value. Other portions of the
DEBT were created by loans, for which the
| government received only one-half of the
| amount 1t was nominally to repay, and
| tnese obllgations bore interest at the rate
! Oh 10 per cent month on their face,
some OF tnem compounded monthly.
The improvdence of the government in
| It's financial management was due to it's
weakness, to its impaired credit and to it's
pecuhlafy needs, occasioned by frequent in
surrectons and revolutionary changes and
by Its inability to collect it's revenues.
The San Domingo Improvement Co.
In 1883 the government, in order to Sc
cure the payment of an issue of bonds
placed the custom houses and the collec-
ton of its customs duties, which are sub
stantlally the only revenues of the repub-
lie, in the hands of the Westendorps, bank
ers of Amsterdam, Holland. But the ma
tlonal debt continued to grow and the gov
eminent finally intrusted the collection of
It's revenues to an American corporation,
the san Domingo Improvement Company,
Wnlch was to take over the bonds of the
Westendorps
Inc dominican government finally be-
came dissatisfied with this arrangement,
ana, In l9o1, ousted the Improvement
company from it's custom houses and
LOOK into its own hands the collection of
It's revenues The company thereupon ap-
pealed to the United States government
10 MAINTAIN them in their position, but
thelr request was refused. The Domini-
can government then sent it's minister of
foreign affairs to Washington to negoti-
ate a settlement. He admitted that the
Improvement company had equities which
ousht not to be diSregarded and the De-
partment OF State suggested that the Do
mlnlcan government and the improve
ment company should effect by private
negot1ation, satisfactory settlement be-
tween them They accordingly entered
INTO an arrangement for q settlement
Whlch was mutually satisfactory to the
parties. similar arrangement was like
wise made between the Dominican gov
eminent and the European bondholders.
Inc latter arrangement was carried into
execution by the Dominican government
ana payments made toward the Hquida-
ton of the bonds held by the European
holders. The Dominican congress refused
TO ratlfy the similar arrangements made
with the improvement company, and the
government refused to provide for the
payment of the American claimants In
hot
a continuance of this treatment of the
American creditors and it's repetition in
other cases, would, if allowed to run it's
course result in handing over the island
to European creditors and in time would
rlpen into serious controversies between
the United States and other governments
unless the United States should deliber-
ately and finally abandon it's interests in
the island.
The Improvement company and it's allied
companies held, besides bonds, certain
banking and railway interests in the island.
Inc dominican government, desirous' to
own and possess these properties, agreed
with the companies that the value of their
oonos and properties was 100000, and
they submitted to arbitration the question
as to the 1nstal1ments in which this sum
should be paid and the security that should
be given. The Hon. George Gray, judge
OF the United States circuit court of ap-
peals, and the Hon Manuel de J. Galvan,
both named by the Dominican republic, and
the Hon. John G. Carlisle, named by the
United states, were the arbitrator and
rendered their award on July IA, 1904. By
ITS terms the Dominican government was
to pay the aforementioned sVnr ct 81, 5O0,-
Goo with per cent interest per af1niIm. in
monthly installments of $37, 500 each during
two years, and of S41, 666.66 each month
thereafter, beginning with the month of
September, 1904, said award to be secured
by the customs revenues and port dues of
all the ports on the northern cost of Santo
Domlngo: The award further provides for
mt of n fi,1a,, ioJ
United States who was authorized in case
or failure during any month to receive the
sum then due, to enter into possession of
the custom house at Puerto Plata in the
nrSt instance and assume charge of the
collection of customs duties and port dues
and to fix and determine these duties and
dues and secure their payment; In case
the sums collected at Puerto Plata shouId
at any time be insufficient for the payment
OF the amounts due under the award or in
case of any other manifest necessity or in
case the Dominican government should so
request, the financial agent of the United
States was authorized to have and exercise
at any and all of the other ports above
described all the rights and powers vested
in him by the award in respect of Puerto
Plata.
Under the award the financial agent could
only apply the revenues collected toward
its payment after he had first paid the ex-
penses of collection and certain other OBJ
legations styled "apardos" which constf- |
tuted prior charges on the revenues as
signed. These prior charges are specified |
in the award. The Dominican government
defaulted in their payments and in virtue |
of the award and the authority conferred |
by the Dominican government and at it's |
request, possession was delivered of the |
custom house of Puerto Plata to the fiscal |
agent appointed by the United States to |
collect the revenues assigned by the ar |
bitrators for the payment of the award; |
and in virtue of the same authority pos |
session of the custom house of Monti Cristi |
has also been handed over. | submit here |
with report of Mr.. John b. Moore agent |
of the United States in this case, and a |
copy of the award of the arbitrator.
Demands of European Claimants.
During the past two years the European |
claimants, except the English, whose in |
terests were embraced in those of the !
American companies, have, with the sup |
port of their respective governments, been |
more and more importunate in |
pressing their unsatisfied demands. The
French and the Belgians, in 1901, had en- |
tered into a contract with the Dominican |
but, after a few payments
were made on account, it fell into neglect |
Other governments also obliged the Do
minican government to enter into arrange
ments of various kinds by which the reye-
nues of the republic were in large part Sc
queStrated, and under one of the agree
ments, which was concluded with Italy in
1909 tho minister of that eOvaruoapt