238 CASE OF THE UNITED STATES. 



Proposal for arbitration and Modus Vivendi of 1907. 



The propositions advanced by Sir Edward Grey in his note of June 

 20, 1907, above quoted, were so much in conflict with the views of the 

 United States Government on the subject that the impossibility of 

 finding a basis for an agreement for the permanent adjustment of 

 the dispute at once became evident, and, under instructions from his 

 Government, Mr. Reid wrote to that effect on July 12, 1907, to Sir 

 Edward Grey, and at the same time proposed that the questions 

 of difference should be submitted to The Hague Court for arbitra- 

 tion, out of which suggestion, it is of. interest to note, grew the 

 negotiations which resulted in the present arbitration, and Mr. Reid 

 further proposed a renewal of the modus vivendi of the preceding 

 year pending such arbitration. Mr. Reid's note is in full as follows: 



Referring to your letter of June 20th, in relation to the New- 

 foundland Fisheries, I beg to say that while its propositions seemed 

 so much in conflict \rith. our views on the subject that my previous 

 instructions would have enabled m^e to make an immediate reply, I 

 hastened to lay them before my Government. 



Before communicating the result I desire to acknowledge and 

 reciprocate to the full the kindly expressions you have been good 

 enough to use as to the moderation and fairness with which Mr. 

 Root has stated the American side of the case. We have had the 

 same appreciation of your conduct of the discussion, and we share 

 your wish to bring the long-standing controversy on the subject to 

 a satisfactoiy conclusion without having added anything tending in 

 the slightest degree to embitter it. 



But with the utmost desire to find in your last letter some practical 

 basis for an agreement, we are unable to perceive it. Acquiescence 

 in your present proposals would seem to us equivalent to yielding all 

 the vital questions in dispute, and abandoning our fishing rights on 

 the coast of Newfoundland under the Treaty of 1818. 



Without dwelling on minor points, on which we would certainly 

 make eveiy effort to meet your views, I may briefly say that in our 

 opinion, sustained by the observations of those best qualified to 

 judge, the surrender of the right to hire local fishermen, who eagerly 

 seek to have us employ them, and the surrender at the same time 

 of the use of purse seines and of fishing on Sunday would, under 

 existing circumstances, render the Treat}" stipulation worthless to us. 



My Government holds this opinion so strongly that the task of 

 reconciling it with the positions maintained in your letter of June 20th 

 seems hopeless. 



In this conviction my Government authorises me, and I now have 

 the honour, to propose a reference of the pending questions under 

 the Treaty of 1818 to arbitration before the Hague Tribunal. 



We have the greater reason to hope that this solution may be 

 agreeable to you since your Ambassador to the United States recently 



