Created: 5/25/1956

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1. Tbo following am* derived fronwith Br* Oreanie* In Bev larkn*ofhrough discussion and cf the record that ba hea OO far enrarllarl.

ertinent chronology appears to ba an folloostuno The data of ossaafji and loss.

2 July Shipping Ocsspany latter to Ouot Minister In tendon (stating an Intention oflaim).

9 July . Secretary of State, rnrelgn Affairs, note to Oust Hinletar, lotto (raoognislng situation ard lnd1 rating that Bar amjeety reserves) tha right to present tha elate la tha nam of tha proprietors).

July Shipping Coapany latter to Ouat Minietex, Londontlala for total lone rather than alnply to tho iissil).

sag. British eollaitora (Btnolalx, Roche and Teaperleylatter to Guat Kinleter, Inodon, Intoo shipping eassjasry (ertendlag the claim toloaa Ofcargo).

ept. . sHnlarUx In Ouat, note to Oust Minister, Foreign Affairs (rec^awrting exatweruly note).

Omat, ond Oast Minister, Foreign Affairs

dlaonsalon (Ouat. that it denied liability bat for purposes ofill might be disposed toettlement, although It could not accept the claim In foil. . Old not salvo the point that tha claim was valid within international lav but did thank Ouat toeasonable sum).

Discussion Ouat with American lav firs (Bighorn, Englar,

Jonas and.e claim U. S.



an. OuatRiotetcr, rarmign Affaire,fbe British(yi. spa rod to

2 rob. . alUaamjs Odgfcam,oueton) iiaasaallag V.oA ot leaat too Brltlah under-arltars loot litlaim la tha sawont afdOlloo doUare to tbo Ouat AraNmsador In saoMngtnn,

2 May . dlnlater Ouat note to Ouat Wniater, Foreign affairs (bops of uroapt aaiHaaenf).

uly Mmrtlng Oraanlaa vith Carina oalaaar (Ouat Minister,

Foreign Affairs) fit larjaa/ snd Benches latour (Senior Adrlaor and saaasi nisi vsanael to Ouat Ambassador to

ug. lattar to Ouat Amheaeedor,. (etfladttlng Hail aamjssiiiiai and rarlaa- of tho prc^laa).

6 Sept. Ouat AsfceeeMelor,cknoeledaed receiptug.

9 sept. Oineaflorajsd this.


Star*. . claim to Omat KUnurter, rcrmlgm Affaire (preaante-tlon by Brltlah flotmruaaat aa official adoption of

Apr. Statelrgram. Sabaesy,.Oust, autborlelng to present hope of speedy and satisfactory

pr. Ouat fllaa to Oraanlaa (Dr. Julio Aeenelo Vunderllch, WAlator-Cconoollar of Ouat Kabaaay* Washington -authorised Greenlee to go ahead In negotiation of pro rata eettlemant.)

j. Xha laamiIf sums ss in aeaat detail tha international

lav pertinent to tola oaao aod tha erguamnta that sdght ba amda In defense of laaml liability of tha aepuhlie of Chmtemala. Bo far, thoro has bsmn



do pmMm tama by tba Oast qjiiiii it except aa expression oftosm assart In aa aanont not to0 for all tba oleic*. They bare not yat anmrad tha arltlah DOte6 aad hm not, tbarefore, cither approved or dlaerjprcrrod. Btmvnr, aot* th* application of their internal pro-eedaret belov. Tha adoption of tan clain, vhlch la on onooit1ri by tne British(rather than elnply thst aaiiiii'sl becking of Itanay be prenst^re ln thn llaht of lirteroatlcoal lav. acranlly, aaIt. tb*mnia not bo adopted unions (a) there bad bean an onrloan justification torttable vrong or cnlpaj (b) all Internal adadnlatxatlve and leanl rlefata aad procedureo bod been ornensfod by tha claimants ar lthat thay varaor that tha porauit of then aaa foe rl sea, thla wouldenial to tha olalnanto vhlch tha Qoiatiastut vonld than ccnsldar aa an affront to tha national Integrity justifying thn adoptionajtnt tha clala ln nature fron pernnnal to national.

a. Isawlm that thararovailo liability vhlch vould ovorccne noraal defenses otbexvlse avallablaatter of International lav. anccsaafal luaursjsuta vould inherit the liabilities of their predaeeasar. (vhiio it la not tha caaa bare* defeat of tba Insurgents vould not result In any liability to tba iasssbente.) tna Oaafalaii Ccajstitutlon provide* thati

ooatabbalana oor aliens any, in any case, clala froa the Oovarnavast any lislsssnt fleet loo for rtsnavpw aod Injuria* to their parsons or property eanaad by turbulent partlea."

Invoking Uds section vonld probably ba endealreble since lt vould ooaa toenial of justice sad vould than justify the British Govero-nent's eepooael of Ita eltlsans* cnaea. Furtharava-e, Ackvorth Indicate* thati

riyarnaant ia not permitted to oat up,inal answer to dananda for tha parfornanca of International obligations, provisions of Its aumielpal lav, either ooootl tutr etatobory"

5. tnthoat going Into tha atataaant of tha lav, anion vould be

repetitive of tba legaltha adoptloc of the ensee by tha

Brltlah Oovarnnant should prauiaoatly be denied aa contrary to prinelpleo of International lev. elephone conversation today vith Panderh arconloc discovered that tba Internal adalnistratlva and legal proecdureo had apparently not bean cxhaueted. lain of this nature, an adninia-trativa resolution oan ba nodeertain larval of official. This aay than be appealedlnlstar level (or it any ba submitted there la tha firstho in torn any rule upon It, but If ho takee

no action irlthlnays ba la determined to have denied it. This pocket voto or unfavorable) deteTDdnatioo can then ba appealed to tba Court of Administrative Contention, consisting of three aagis-tratos vho operate vith the aselataace of vhateneral type of district attorney. An unfavorable decision here oould. thon ba appealed to tho local SuprssMi Court which apparently raise not only onIssues Involved bat also on all phases of the casa. Vuodarlicb (who Isssnasmtd Oraanlaa aa being an intelligent end eoapstsnt lawyer) Indicated that holaimant sovereign could than tats them Into tho world Court In view of their membership la tho Doited Hat ions.

net affect of this would seam to be tbat the Britishnight successfullyovereign immunity defease end a

nut fliw ii it of so much on tha dollar would be something for less then gratuitous. Thia might be used to reduce and possibly eliminate any local opposition to tha payment.

lt would aeem that the British have been forcingwith moraair amount of vigor and that theirIn faot be premature in adopting their claim, lt ls Interestingthat there has been only one effort aade by thoehalf of the. underwriters. Tbo problem then becomes onenegotiations with both claimants to meat the impetus of one

but not to encourage an Impetus froa tho other, with regard tolt would aeem perfectly logical for the GuatemalanIndicate to the Britishthat the Oraenloo firm waatheir interests In this mutter. They could then take thewith regard to the United States attorneys representing tbet would seam undesirable for our State Pspertamnttha. underurltera (directly or through theirendtep that would seem to bo encouragingof the claim. By the aaaa token, it vould Been mostthe. Ooveromeut would wish to enforce such claims by snthe same manner aa tbe British have.

c 3

General, counsel


Original document.

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