Evening star., 1924-07-20
French Especially Concede
Serious Impasse Ended
by Americans Aid.
TWO GREAT OBSTACLES
SURMOUNTED IN DAY
Investors Assured Priority on Ger
man Resources in Event
of Default.
By the Assoc lated Press.

LONDON. July l9.-The committee
ference agreed unanimously today on
two important principles to govern
the action Of the allies in the event of
possible default by Germany under
the Dawes reparauon plan, namely,
to insure investors in the loan to
Germany of priority on all German
resources in event of such default,
and to preserve the rights Of the coun-
tries signatory to the Versailles
treaty.
With this agreement. in the opinion
Of the American, British and French
delegates, a long step has been taken
toward the success of the conference
upon which such high hopes have
been raised for the economic restora-
tion of Europe.
At the opening of the conference
Wednesday it was generally recog-
nized that the proposed loan to Ger
many was the crux of the Dawes
plan and after only four days delib-
erations it was possible for the COM
mittee to agree that in any con-
tingency, including default and re-
sultant sanctions, the holders of the
loan should have priority claim to
the assets OF Germany With this is
coupled an agreement that the pro-
tocol to make the conference action
effective shall reserve all the rights
enjoyed at present by those countries
which signed the treaty of Versailles.
France Claims Victory.
France halls the latter decision as
distinct victory for her and takes
it to mean that she still has the right
to separate action should Germany
default. Premier Herriot announced
his satisfacttsa with the great prog
ress which has been made, and his
adherents construed this as calculat-
ed to silence any charge by his oppo-
nents that the premier bartered away
the rights of France under the
treaty of Versailles.
The American and British delegates
share in the French enthusiasm over
the fact that the unanimous agree
ment has carried the work of the
conference so far forward, although
they do not share all the inferences
France is ready to draw from today's
understanding.
Young Explains Plan.
Owen D. Young. the American ex-
pert, who is credited with the in
spiration Of the loan guarantee,
although it actually was proposed to
the committee by Count de Perriti de
La Rocca of Italy told the Associated
Press. tonight that in his opinion it
offered sufficient safeguards to in
vestors to insure the loans success
full f1otation and that the fear of the
possibility of separate French action
against Germany would not endanger
the investors guarantees.
The American and British do not
concede that the document agreed
upon today empowers separate ac-
ton by France. In fact, neither the
present Macdonald government nor
any previous government nor any
considerable portion of public opinion
has ever recognized the legality, un-
der the treaty of Versailles, of the
present French occupation of the
Ruhr.
But, it is pointed out, such ques-
tions of legal construction remain for
the future. For the time being,
France has won her demand that the
reparation commission shall remain
the arbiter of Germany's faith under
the Dawes plan.
Agent General Limited.
In. establishing possible German
default, the reparatons commission
must take the advice of the agent
general of reparations and the trus-
tees of the loan, but those officials
will not be empowered. as Great
Britain first desired, to act as sort
of grand jury in determining the pre-
liminaries of default
That remains the prerogative of the
sisted from the start.
On all sides tonight, but especially
among the French delegation, there
was a disposition to concede that the
United States played an important,
although unofficial part in the negoti-
ations out of which it is hoped to
launch the Dawes plan.
The American Secretary of State,
Charles E. Hughes. reached London
before news of the agreement was
announced.
Hughes Speaks.
Making it plain that he is to take
no part in the conference. but is here
solely as president Of the bar asso-
ciation, the Secretary said:
I'VE are greatly interested in the
execution of the Dawes plan and
hope it will take place as soon as
possible. We strongly favor it as a
basis for the economic restoration of
Europe"
The committee drafting plan for
economic evacuation of the Ruhr by
France--one of the stipulations Of
the Dawes pian-will work over the
week end on its task, and IL progress
warrants 1t will be possible to hold a
plenary session Of the conference
Monday to receive this report as well
as the report of the committee on
defaults ana sanctions.
The basis of the plan before the
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