United States. Congress. Senate. Committee on Fore.

Compilation of reports of Committee ... 1789-1901, First Congress, first session, to Fifty-sixth Congress, second session .. online

. (page 143 of 156)
Online LibraryUnited States. Congress. Senate. Committee on ForeCompilation of reports of Committee ... 1789-1901, First Congress, first session, to Fifty-sixth Congress, second session .. → online text (page 143 of 156)
Font size
QR-code for this ebook


That was controlled here by Mr. Stanton and Jncige Black.

Q. Do you know whether they had access to the books of the com
. pany at that time?— A. No, sir; Lam quite confident they hiui not

Q. Did they ever inquire as to whether the company had any books
or reports I — A. I never knew of their making any inquiry ; do not
believe they ever did.

Q. When they were counsel of the company did they never write you
making any inquiry about booksf*— A. Such letters as were written to
me as counsel (lirect came into my hands, and they never made any in-
quiry about the books of the company.

Q. When did you first learn of any alleged negotiation that any-
body was attempting with Mr. Exall for the purpose of securing testi-
mony in relation to the award? — A. I learned it from him in January,
1878.

Q. When, to the best of your knowledge, did it commence t — A. My
knowledge is simply derived from him. He said that Mr. Weed had
been to see him that morning, ft commenced that day, I suppose.

Q. You understood it to be the first day! — A. Yes.

Q. Became to you direct ! — A. No; he came to see Mr. Baldwin,
who was the president, and not finding him said he wanted to see me.

Q. Do you know what Mr. Exall was doing at that time! — ^A. I
am quite sure he was the book-keeper or cashier, I guess it was, of Mr.
Tuttle's house, but I am not certain about that. He was book-keeper
there for one or two firms at one time, and I think he was with Mr.
Tuttle at that time.

Q. Do you know whether he left the city shortly after this negotia-
tion !— A. 1 don't think he did. I think he died in the winter of that
year. I don't know of his leaving the city before his death.

Q. Did you ever ask him to leave the city ! — A. No, sir ; never heard
of such a thing nor thought of such a thing ; never had any idea there
was any object in his leaving the city.

By Mr. Kennedy :

Q. Where were the books of the company showing the ores extracted
from the mines, the expense of the extraction, and the cost of the ma-
chinery kept ! — A. At the mines, so far as 1 know. I have no definite
knowledge on that subject. I understood they were kept there ; that is
all.

Q. Now, do yon know whether any of those books were brought from
the mines by Exall at the time that he left Tayoltita in 1868!— A. I
understood from him that he had left everything there behind him. I
never saw any books that were kept there except that 1 have seen the
alleged letter-book here before this committee last fall.

Mr. Foster. Mr. Chairman, I would like to make a statement to go
upon the record If the afiidavit which has been offered to-day of
Exall is finally decided by the committee to be proper and is admitted
on the record, I then desire to ask that all the afiidavits which the
Mexican Government has submitted to the Secretary of State or to
either branch of Congress which have been published in official rec-
ords — and the number of them is quite large — that these also be added
to the record of this investigation.

The (Chairman. They are all accessible on the record, are they!

Mr. Foster. They are all in print.

Mr. Kennedy. In that case, Mr. (Miairman, we have affidavits bear-
ing on Alfred A. Green's conduct — General Slaughter's subagent in



Digitized by VjOOQ IC



THE LA ABRA SILVER MINING COMPANY. 971

laying to suborn witnesses — that we offered the other day, and we will
want those also on the record.

Mr. Foster. They have never been printed or submitted either to
the Secretary of State or either branch of Congress. The chairman
will understand that I do not make this application except

Mr. DoLPH. You wish to take advantage of the ruling of the com-
mittee if it admits this affidavit ?

Mr. Foster. Yes ; we understood it was not proper to admit such
affidavits.

The Chairman. If we are going into the trial of this question upon
ex parte affidavits, of course we must throw the door oi)en.

Mr. Foster. We want the benefit of that kind of testimony if it is
to be accepted.

Mr, Kennedy. The only ground upon which we think that this
affidavit is admissible is that it was filed with the Committee on Foreign
Relations and has disappeared from the files.

Mr. DoLPH. Suppose the original were here, would that be compe-
tent?

Mr. Kennedy. Yes, sir; I think it would, under the ruling of the
committee made early in the investigation, that all papers that had
been printed officially in La Abra case, or that had been submitted to
the committees, should be considered as being in evidence.

The Chairman. Not in evidence, Mr. Kennedy. That has been cor-
rected time and time again. This committee will state definitely, in
order to prevent any misunderstanding about it at all, that the record
of the State Department ])ut in here is not evidence. It is

Mr. DoLPH. It is just as to one thing, as to what Mexico claims.

The Chairman. That is all.

The committee adjourned.



Digitized by VjOOQ IC



Digitized by VjOOQ IC



IN^DEX.



TESTIMONY.

Baldwin, James 745

Dahlgren, Charles B 643,659,688

Elder, A. B 546,553,561,592,630

Ely, SamnerStow 939

Fisher. Thomas H78

Garth, David J Ill, 127, 145, 171, 224, 8-24, 8*^6

Hermosillo, RamoD 543

Kittolle, George W 766

Lines, Robert B 922

DeLagnel, Jnlius A 6,10,25,39,74

Sisson, Isaac 788,825

Slaaghter, James E 911

Soiiiero, Engenio 532

Torres, Francisco 502

Tattle, William F 22

LETTERS.

236

260

302,332

31H

687

2,722

RECORD.

Of case of La Abra Silver Mining Company r«. The Republic of Mexico, before

the American-Mexican Claims Commission 327

Index to record 500

List of aasignments 935

S. Doc. 231, pt •' «3 ^73



Digitized by VjOOQ IC



Digitized by VjOOQ IC



tenatt Xaport 8705, Part 2, Fiftioth Oongrost, sooond teMion. (Yiewi of minorily.)



m THE SBNA.TE OF THE QNITBD STATES.



March 2, 1889.~Ordered to be prlated.



Mr. Bbown, firom tbe Oommittee on Foreign Relations^ submitted the

foUowiDg

REPORT:

[To aooompany bill S. 2632.]

VIEWS OF THE MINORITY.

[The referencM fn this report to the Appendix, whioh ta printed with tbe majority npott, we to the

top paging.]

Under a resolution of the Senate, passed August 30, 1888, a subcom-
mittee of the Oommittee on Foreign Relations has been engaged in tak-
ing testimony respecting the claim of La Abra Silver Mining Oompany
against the Government of Mexico until the closing days of the Fiftieth
Oongiess. The last witness was examined in the afternoon of the 27th
of February, and his testimony, comprising the last thirty-two pages
of the record of the subcommittee's proceedings, was not printed until
the 2d of March. The report of the majority of the committee was sub-
mitted to the Senate on the 1st of March, with the testimony, which was
ordered to be printed as an appendix, and leave was granted for the
printing of the views of the minority. (Oongressional Becord, March
2, 1889, p. 2753.)

The appendix, containing nearly a thousand printed pages, comprises
not only the oral examination of witnesses who have testified in the
course of this investigation, but also a transcript of the alleged origin^
press-copy book kept at the office of the Abra Silver Mining Oompany^
at its mines in Mexico (pp. 236^18) ; certain original letters of David J.
Garth, treasurer of the said company, addressed to Oharles H. Bxall,
superintendent at the mines, in the year 1867 (pp. 318-322); certain
original letters of the said 0. H. Exall, addressed to James Granger
in the spring and summer of 1868 (pp. 322-326) ; the memorial and evi-
dence submitted by the said La Abra Oompany to the United States
and Mexican Olaims Oommission, comprising the certificate of incorpo-
ration of the said company, the titles to its various mines in Mexico,
and the depositions snbmitted in support of its claim, together with the
depositions submitted in opposition by the Mexican Government to the
said Oommission (pp. 328 - 499). The testimony of witnesses who have
been examined orally by the subcommittee comprises the first two hun-
dred and thirty-five pages of the appendix, and also extends from page
502 to page 971.

The Mexican Government was represented in the investigation by its
counsel, the Hon. John W. Foster, late United States minister to Mexico,
and Mr. Bobert B. Lines, formerly of the Department of State. La Abra

975



Digitized by VjOOQ IC



976 ul abba silver mikino compant.

Company, by its coansel, filed a protest with the sabcommittee against
the propoised proceedings, which will be found on pages 2 and 3 of the
appendix, closing with the statement that '* their presence at and their
participation in the investigation is only resorted to becanse of their
respect for the Senate." The grounds on which the Mexican Govern-
ment participated in the investigation were stated by Mr. Foster as
follows:

Mexico's interest in this investieation is this : She reoogoizee that this la a domeatie
investigation by Congress ^ but she has proof of frand and peijnry, alleging that this
award was obtaioed by fraad and peijury. Upon the invitation of the committee we
are present this morninpr to sustain, as far as we can, that allegation by onr presenoe,
and, if possible, maintain the position which Mexico has assumed on tnia question, so
that you may have the benefit of whatever information or assistanot^ we can give yon
in establishing that claim of fraud and peijury. I think that is a sufficient answer
to the gentleman as to onr position here to-day. We do, upon the invitation of the
committee and with the consent of the State Department, appear here to repreeent
Mexico in this investigation. (Appendix, page 4.)

At the same sitting the chairman said :

The investigation which the subcommittee is conducting nnder the order of the
Senate and the order of the full Committee of Foreign Relations is one simply of ex-
amination to ascertain, as I uuderatand, whether or not it is the duty of Congress to
order this mouey to be paid over to La Abra Silver Mining Company, or make some
other disposition of it, or have some investigation in a court of a more formal character
than this can possibly be npon the real character of this award, whether it was ob-
tained by fraud or peijury or whether it was obtained upon reliable testimony. • • •

Onr present intention is to take testimony and iay before the full committee what
we arrive at, and probably express our opinion npon its general merits when we
come before the committee. (/Md., p. 5.)

The purpose of the investigation — the question to be considered by
the committee and Congress — ^is thus expressed in the majority report
(p. 2):

Whether the evidence presented by the Mexican Government to show that the
award made by said commissiou in respect of the claim of La Abra Company was pro-
cured by fraud, and (whether) the testimony taken by the committee, under the an-
thority of reRolutions of the Senate heroin referred to, i« of such a oharaeter a$ to rO'
quire investigation by a competent tribunal to determine whether the United Statee in pre-
senting the olaim of La Abra Company to the Mixed Commission teas not made the vicUm of
fraudulent imposition.

Under the aforesaid resolutions of the Senate, an opportunity has been
granted to the Mexican Goveruineiit, at the expense of the Government
of the United States, to impeach or surcharge the award which was
rendered in favor of La Abra Company by Sir Edward Thornton, as um-
pire of the United States and Mexi(5an Claims Commission, on the 27th
of December, 1875. This gives great importance to the new testimony
which has been taken, and requires that it should be carefully and im-
partially examined.

Before considering whether the aforesaid investigation has so im-
peached the award as to justify any attempt to set it aside, and waiving
for the present the question whether Congress can properly interfere in
such a matter, as proposed by the aforesaid bill (S. 2632), the under-
signed desires to state certain propositions which he thinks are not dis-
puted :

(1) The integrity of the Commissioners, or of the umpire, appointed
under the treaty of July 4, 1808, to decide upon the claims of citizens
of the United States against Mexico and of citizens of Mexico against
the United States, and who made the award in favor of La Abra Oom*
pany, is not and has never been questioned.

(2) The Governments and tlie individuals concerned had ample time
in which to present their evidence to the Commission. The existence



Digitized by VjOOQ IC



LA ABRA SILVER MINING COBfPANY. 977

of the Commisaiou was extended by various conveutions antil Novem-
ber 20, 1876. The first depositions in support of tlie claim of La Abra
Company were taken late in tbe year 1869 or early in 1870, and filed
with the memorial or petition in the summer of that year, and the tak-
ing and filing of depositious continued on the part of tbe said company
antil the spring of 1874. Some of these depositions were in rebuttal of
the evidence which had been taken on behalf of the Mexican Govern-
ment in 1870 and subsequently, and which had been submitted by the
Mexican agent to the Commission in October, 1873. As has been noted,
the award of the umpire in this case was not made until the 27th of
December, 1875. There is no complaint on the part of Mexico of sur-
prise or want of notice or lack of time in conducting its defense. Upon
these points Mr. Evarts, while Secretary of State, expressed his conclu-
sions to the President as follows:

I am of opinion that as between the United States and Mexico the latter Govern-
ment has no right to complain of the conduct of these claims before tbe tribunal of
commissioners and umpire provided by the convention, or of the Judgments given
thereupon, so far as the integrity of the tribunal is concerned, the regularity of the
proceedings, the full opportunity, in time and after notice, to meet the case of the
respective claimants, and the free and deliberate choice exercised by Mexico as to
the methods, the measure, and the means of tlie defense against the same. (Mr. Evarts
to the President, August 13, 1879.)

(3) It is admitted that La Abra Oompany, composed of citizens of
the United States, and organized under the laws of the State of New
York in the year 1866, purchased mines in Mexico, to wit : " La Abra/'
*' La Luz," "Eosario," " Arrayan,*' " Ynocentes,'' " La Talpa,'' and " El
Sauz," near Tayoltita, for $72,000, and thereafter built extensive and
expensive works for carrying on its business of mining, and couducted
its operations at Tayoltita, in the mineral district of San Dimas and
State of Durango, from the fall of 1865 to the spring of 1868. This is
not a case in which it is claimed, as in the famous Gardiner case, that
the property for the value of which an award was rendered had no ex-
istence in fact. The Mexican Oovernment does claim that the umpire
set too great a value upon the ore which was left on the company's
^* patios " when its mines were abandoned, and does deny that the com-
pany was forced to abandon its property in Mexico by the unlawful acts
or omissions of the Mexican authorities or people.

(4) The question of the value of the company's property, and the
question whether the company was compelled to abandon that property
by the unlawful interference of the Mexican authorities or their failure
to protect the company against unlawful acts of the Mexican people,
were the main questions at issue before the Commissioni and it was to
these two questions that the great bulk of the testimony on both sides
was directed. There was no misunderstanding or misconception of the
issues involved in this international trial, and, as previously observed,
it extended over five years, and a mass of evidence was presented on
the part of each Government in this particular case.

(5) All of the testimony submitted to the Commission by the Mexican
Government was taken in Mexico, the witnesses were Mexicans, the
officer who directed the proceedings to obtain the defensive depositions
for the Mexican Government was a Mexican, and the magistrates before
whom these witnesses were examined were Mexicans.

Much of the testimony on behalf of the company was taken in Mexico ;
aoonsiderable number of the company's witnesses were citizens of Mexico,
and were, when they were examined, and, so far as they are still alive,
are within the jurisdiction of the Mexican Grovemment. These wit-



Digitized by VjOOQ IC



978 LA ABRA SILVEH MINING COMPANY.

Defises and their testimony were assailed by the Mexican comtniBsioner,
Zamaoona, in his opinion upon the claim, and by the Mexican agent,
Avila, in his motion before the umpire for a new hearing, but not one
of these witnesses was ever prosecuted by the Mexican Government for
perjury, or any proceedings taken, so far as appears, in that direction,
notwithstanding the timely and pertinent suggestion which was made
by the umpire in his opinion denying the Mexican Government's motion
to open the award.

The Mexican agent [said Sir Edward Thornton] would wish the ompire to beliere
that all witnesses for the olainiant have peijnred themselyes, whilst all those for
the defense are to he implicitly helieved. Unless there had been ^gflrooj of peijoiy, the
umpire wonld not have been Justified in refusing evidence to the witness on the one
side or the other, and could only weigh the evidence on each side, and decide to the
best of his Judgment in whose favor it inclined. If peijury can %i%l\ be proved by
further evidence, the umpire apprehends that ikere art oourU of justice in both conn-
trios by which perjurers cam (• tried and oonvictedt and he doubts whether the Gk>yem-
ment of either would insist upon the payment of claims shown to be founded upon
perjury.

More will be said on this point hereafter, when we come to consider
the course which was adopted by the Mexican Government, upon the
adjournment of the Commission, in endeavoring to subvert the award.
as disclosed by the new testimony taken by the subcommittee ana
printed in the appendix to the committee's report.

(6) La Abra Company was not organized or oondncted as a specula-
tion for the sale of its stock, but as a bona-flde mining enterprise. Its
'' promoters " took shares at par to the amount of $157,000 in gold,
costing $235,000 in currency, and subsequently made loans to the com-
pany to pay the drafts of its superintendent in Mexico, amounting to
about $70,000 more. Not a dollar was borrowed by the company, except
from its own shareholders, and not a share of stock was offered in the
market by the company for sale. The company purchased the mines
through Messrs. Bartholow and Garth, who transferred the titles to the
company without a dollar of profit, and afterwards took stock, for
which they paid par in gold, and, later on, lent the company money
when its expenses proved so much larger than had been expected. (Ap-
pendix, pp. 475, 476 ^ foot of page 105 : also, p. 115.)

The usual plan of issuing shares to tne vendor for the property to an
amount from ten to one hundred times greater than the real purchase
price, and taking back the bulk of the shares to be divided between the
treasury and the ^^ promoters " was not followed in this case. On this
point the umpire said, in rendering his award:

He is also of opinion tbat the enterprise upon wbich the clAimants entered, of piir-
obasing, denonnoing, and working certain mines in tbe State of Durango, in Mexioo,
was a ierioue and honest bueinees traneaction on their part, and tbat there was nothing
raihf deceit/ul or fraudulent in it, but tbat it was engaged in with the eole intenUon A
carrying out legitimate mining operations.

The Company* s Claim was Supported by Depositions submitted to theJoisU
Commission on the part of the Mexica/n ChvemmenL

The nndersigned now proposes to state briefly certain material facts
supporting tbe company's claim, which were proved before the Commis-
sion by witnesses whose depositions were taken and filed with the Joint Com-
mission on behalf of the Mexican Government :

(1) As to the purchase of the mines by the company : the price paid
for them; the previous profitable working of the said mines by their
former Mexican owners; the buildings and machinery erected by the
company at Tayoltita, and tiieir cost.



Digitized by VjOOQ IC



LA ABBA SILVEB MININQ COMPANY. 979

(2) The unlawfol iuterference of looal magistrates with the operations
of the company ; tbe unlawful imprisonment of the company's superin-
tendent, Oharles H. Exall ; and the failure of the authorities to enforce
the laws and afford, the comi>any proper and necessary protection.

As to the expenditures of the company for the mines and machinery.

D. Juan Castillo de Valle, who was examined at Durango on behalf
of the Mexican Oovernmeutf September 24, 1872, testified (Appendix,
p. 445):

That althongh he doee not reoolieot tbe names of all the owners, he remembera that
those of Thomas F. Bartholow and David J. Ghirth were among the principal ones.
• • • That he received as the price of the " Lnz," ** Bosario,'' •* Cristo/' " Yno-
eantesy" and ''Arrayan^' mines, with the hacienda, for beneficiating ores,sitnated in the
mining district of Tayoltita, called ** San Nicolas," the sum of |50,000. and that the
Americans, as expressed in the interrogatory, added these mines to the Ahra com-
pany or enterprise.

James Oranger, a British subject, who had been bookkeeper and
clerk for the company at Tayoltita, four of whose depositions were taken
at different times and submitted to the joint commission by the Mexi-
can Government, testified at San Dimas, October 6, 1871, before Judge
Qmroz(fMd.9P. 425):

That he supposes it to he tme that the company has spent $303,000 in the purchase
of their mines and machinery, and in working the same. "* * « That in answer to
the question whether or not the mines and huildings erected by the company were
likely to have cost a million dollars, he said that they probably cost $303,000, count-
ing ail the labor expended on them, as they themselves say in their memorial.

N. A. Sloan, a citizen of the United States, a resident in tbe mining
district of San Dimas, who had also been in the employment of the com-
pany, testified on the 9th of October, 1871, at that place, before the same
judge {ibid., p. 426) :

Thatit is true that they brought with them mechanics and set up machinery * * *
That in response to the question, as to whether this company spent in the purchase
and working of their property the sum of ^03,000, and whether from the result of
this expenditure they were taking out a million dollars annually profit, he answered
that at the time he was a clerk for the company^he saw, according to the statement
of the superintendent, that they had expended $303,000, and had taken out a Utile
lass than $6,000 in silver.

Aetoihe products of ihe mines anterior to their purchase by the company.

It will be noticed that the proof of the previous profitable working
of the mines afforded by witnesses who were examined on behalf of the
Mexican Government does not confirm the statement, or, rather, the
intimation, contained in the report of the majority of the commit-
tee that the company was deceived and imposed upon by the Mexican
vendors of the property, and acquired nothing that was worth preserv-
ing. The committee say, on page 10 of the majority report:

At the mines the representatives of the syndicate were shown very rich specimens
of ores, assaying as high as $1,300 per ton, and as a result of their investigation they
made a purchase on the spot of La Abra mine, paying for the same $22,000 in stock of
the company. They also bought of a Spaniard ana a Mexican a number of other mines
at the same place, and paid for them $^,000 in gold. These mines were represented to
be at that time producing very rich ores, and the syndicate were shown by the owners
'* stacks of silver. * * * some tons of pure silver," the supposed recent product
of these latter mmea.

Withoat meaning to say that the products of these mines were in no
wise exaggerated by their Mexican vendors, the undersigned submits



Digitized by VjOOQ IC



980 LA ABBA SILVER MINING COMPANY.

that the following statements, put in evidence by the Mexican Qovem-
ment, show that the property purchased by the company was of sab-
Btantial value for the purposes of mining. Patricio Oamacho testified
(Appendix, p. 413) :

That he has been acquainted with the mining diatriot of Tayoltita dnoe his in-
fancy ; that before the mines which have been named over to him became the prop-



Online LibraryUnited States. Congress. Senate. Committee on ForeCompilation of reports of Committee ... 1789-1901, First Congress, first session, to Fifty-sixth Congress, second session .. → online text (page 143 of 156)