zens against Mexico relative to the Pious Fund, and existing, as alleged, at the time of celebrating said treaty, there is still another ground upon which that claim might be canceled, and consequently the right to collect interest on capital. It is well known that the Mexican Republic, in the exercise of its sovereignty, and for high political reasons, which the Mexican commissioner explained in his opinion of 1875, ordered in the years 1856 and 1859, first, the disentailing, following it by the so-called nationalization of the church property, but which, properly speaking, was not actually such, but only the prohibition to the clergy of continuing in control of those national properties. If, as has been properly said, the validity and principles of this provision can be disputed from the standpoint of canon law, from a political and social point of view, they are unquestionable, and no less so in view of the favorable results which that action has produced in the way of establishing peace and of promoting the general welfare of the Republic.

From the standpoint of common law and private international law, it seems clear that the capital whose interest is claimed in the character of a secured annuity (censo consignativo), or of general annuity (censo), and which should be considered as real property (Sala. Dro. Real de España, tom I, Lib. 2, tit. 14, and authors cited), was subject to the legislation of the country in which it was held, to the jurisdiction and statute law rei sitae, whatever might be the nationality of the annuitants.

On the other hand, it should be taken into account that the failure for many years to collect the interest which is now claimed makes it subject to the laws of limitations of the country, concerning which Article 1103 of our Civil Code applies to the case, and says as follows:

Emphyteutic or annuity pensions, revenues, rents, and any other loans whatsoever, not collected when due, remain barred in five years, counting from the maturity of each of them, even though the collection be attempted by virtue of a real or personal action.

If we are to suppose that the demand of the claimants was not canceled by the decisive Article XIV of the treaty of Guadalupe Hidalgo, or on the other grounds which we have just reviewed, there is yet another reason which would make it seem subject to Mexican legislation, to which an annuity, established by that Government in the year 1842 is undoubtedly subject. Said Government, for the purpose of settling the public debt, issued, under date of June 22, 1885, a decree calling upon all its creditors for the examination and funding of their debts arising from supplies, employments, loans, or any other act or business which might become a charge upon the national treasury, and for this purpose it fixed a suitable time, which was extended on several occasions for the presentation of said claims. Article XV of the law of September 6, 1894, was of the following tenor:

The debts, evidences of public indebtedness, and the following claims, are forever barred, without being able to constitute any cause of action, or to be of any validity whatever: * * * All claims included in Articles I and II, which were not presented for this funding within the period fixed by the article preceding or which when they are presented, the interested party may not comply with the requirements of said decree.

It is undeniable that the supposed claims for capital and interest made against the Government of Mexico by the archbishop and bishops of the Church of Upper California were not presented for adjustment

in compliance with the law of 1885, nor did the pretended creditors avail themselves of the new period which the said decree of 1894 granted them in Article XIV as a final and last resort. The lapse (caducidad) or barring of suit, or supervening plea, would leave without effect even a former judgment having the force of res judicata—a principle of well investigated law recognized even by the present claimants.

IV.

The claimants state that the object of the Pious Fund of the Californias was to provide for the conversion of the Indians and for the support of the Catholic Church in the Californias. This being a double object, it is necessary to distinguish between the two parts which constitute it. The first part, the conversion of the pagan Indians to the Catholic faith and to the obedience of Spanish authority, is unquestionable, and must be considered as the principal and direct object of the missions intrusted to the Society of Jesus by the Catholic King, indorsed by the founders of the Pious Fund, and subsidized by the public treasury of Mexico. The other part of the object-that is, the support of the church in California, was not the principal or direct object of the establishment of the fund, but the means of carrying out the spiritual conquest of uncivilized Indians through the religious missionaries.

This distinction being made, it is understood that the Catholic worship was an object of the missions subordinate to the spiritual conquest of the uncivilized Indians; hence it follows that the nonexistence of uncivilized or idolatrous Indians in a specified region, or of the suppression therein of the Catholic missions, instituted for the purpose of subjugating or Christianizing them, should entail at the same time the withdrawal of the support offered the missionaries; not their exclusive application to fostering the Catholic faith, otherwise it would be an open violation of the intention of the benefactors who founded said pious work. Upon the expulsion of the Jesuits ordered by King Charles III and the consequent cessation of the missions of New Spain, the suppression of the order followed, which Clement XIV declared in his bull, issued the 21st day of July, 1773, paragraph 32, which reads:

But as regards the religious missions we desire to extend and include all that has been decreed concerning the suppression of the Society (of Jesuits), reserving (at the same time) the privilege of providing the means by which not only the conversion of the infidels, but also the peaceful settlement of dissensions may be obtained and secured with greater facility and stability.

And it is a fact worthy of note that the missions founded by the Jesuits never extended beyond the limits of Lower California. The mission farthest north that they had in charge was that of Santa Maria, below the thirty-first degree of latitude, and was therefore outside of the limits of Upper California, as fixed in the Treaty of Guadalupe Hidalgo.

The missions of Upper California were undertaken after the expulsion of the Jesuits by the orders, not of the Society of Jesus, nor of the Holy See, nor any other ecclesiastical authority, but of the viceroy of New Spain, with the approval of the King, in 1769 and 1762.a

a Should be 1772. J. H. Ralston, Agent United States.

As national enterprises the missions of Upper California were naturally abandoned by the Mexican Government when the United States acquired that region. The abandonment became necessary by the change of authority and jurisdiction over the territory disposed of to the United States, and, moreover, the Mexican Government had the original authority which it had inherited from the Spanish Government to abandon missions and establish other new ones for the conversion of infidels within its dominions.

No only did the missions of Upper California cease on the 7th of July, 1846, as national enterprises in charge of the Mexican Government, but the Catholic Church itself ceased as a legal entity, inasmuch as its reestablishment as a corporation did not go into effect until the 22d of April, 1850, in virtue of the statute of that date of the State of California.

Finally, it is necessary to take into account that in Upper California there exist no tribes of uncivilized Indians whose subjugation to the secular power of New Spain and conversion to the Catholic faith was the principal object or direct end of the missions of the Jesuits endowed with the properties of the Pious Fund of California.

V.

The right of investing the fund and applying its proceeds according to the intentions of the donors of the properties which constitute it were legitimately exercised without the intervention of ordinary clergy, first by the Jesuits, followed by the Spanish Crown, and lastly by the Mexican Government. The claimants can never prove that any legitimate authority has ever made any law or decree to restrict that right. In exercise of this right the Mexican Government ordered, by the decree of September 19, 1836, that the administration of the fund be given to the bishop of California and his successors as dependents of said Government; the same commission was withdrawn from the bishop and his successors by the decree of February 18, 1842; the sale of the properties which composed the fund and its constitution into the secured annuity (censo consignativo) upon the National Treasury was ordered by decree of October 24, 1842; and two and one-half years later, by the decree of April 3, 1845, the "creditos" and other properties were ordered returned to the then bishop of California and his successors, reserving expressly the right to dispose of the proceeds resulting from the properties sold, the interest on which is the very subject-matter of this claim.

This exclusive right of the Mexican Government is recognized on the part of the claimants.

In the reply made February 21, 1901, to the honorable John Hay, Secretary of State of the United States, by Messrs. Jackson H. Ralston and Frederick L. Siddons, attorneys for the Roman Catholic bishops of California, are found the following words: a

No dispute has ever been raised as to the right of the Mexican Government to administer the property in question. Mexico must continue the trust relation which

A full and complete extract from the Diplomatic Correspondence (p. 52) above quoted partially and imperfectly, reads as follows:

"No dispute has ever been raised as to the right of the Mexican Government to administer the property in question and charge itself, as a trustee, with the payment of a definite sum. No demand has ever been made for the repayment of the principal sum. The bishops of California and all other parties in interest have treated

she has herself assumed. It should be borne in mind that we never have had or made any claims to the principal. From its origin it has been in the hands of trustees; first, the Jesuits; then in the Spanish Crown; then the Government of Mexico; then in the bishop under the law of 1836; then, from February 8, 1842, again in the Mexican Republic. All of these changes were accomplished by law-the act of the sovereign.

VI.

The use which the Mexican Government made of the sovereign privilege to reassume the right of administering the fund or investing its proceeds to the exclusion of the church of California in 1842, can not be considered in law prejudicial to the party claimant. "Qui jure sno

utitur neminem laedit."

Nor for the same reason can the fact that this government, since it ceased to exercise authority over Upper California, should have centered all its care and protection on Lower California, not only in the civil but also in the ecclesiastical order, and discontinued consequently to apply to Upper California the revenues intended to foster the Catholic missions, justify the claim against the Mexican Republic.

The missions of the Jesuits having discontinued in that territory, there remained no necessity that its inhabitants should receive from Mexico supplies, clothing, and other means of subsistence; its lands were about to come under cultivation, as in fact they did, with marvelously productive results; and under these circumstances the Government was at liberty, as trustee (comisario), in place of the Jesuits, to apply the proceeds of the fund to other missions, without exposing itself to censure, complaint, or claim from anyone, conforming entirely to the will of the founders expressed in the foundation deed of the fund, according to the language of the text above cited.

VII.

The exaggeration of the demands, or plus petición, is demonstrated in various ways, and, reserving the privilege of presenting in the course of the proceedings a basis for a settlement, which up to this time it has not been possible to conclude, I make the following observations:

In the first place, it is most evident that to solicit now, in Mexican gold money, the payment of the interests which are claimed because

their claim against the Mexican Government as being a claim for an annuity, the amount of which annuity has been fixed by the Mexican Government at a sum equal to 6 per cent upon the total capitalization. Mexico, by her acts in 1842, recognized the definite character of the claim against her, acknowledging a liability, not for the principal, but for a certain annual charge. After having herself stamped this character upon the claim of the Pious Fund, Mexico can not now say that the claim is to the principal and not to an annuity, and a claim for the principal, if such existed, being barred by treaty stipulation, no claim for the annuity can exist. Mexico must continue the trust relation which she has herself assumed.

"The difference now insisted upon is more than verbal; it is substantial, and is to be borne in mind when it is suggested to us, as it has been by the Mexican secretary of state, that we have lost our claim to the principal because such claim was not presented under the treaty of 1848; the fact being that at no time under the Mexican decrees could a claim for the principal have been entertained.

"It should be borne in mind that we never have had or made any claim to the principal. From its origin it has been in the hands of trustees; first, the Jesuits; then the Spanish Crown; then the Government of Mexico; then in the bishop under the laws of 1836; then from February 8, 1842, again in the Mexican Republic All of these changes were accomplished by law-the act of the sovereign." JH. Ralston Agent United States.

other interest on the same capital were ordered paid in this money by the award made in November of 1875, is to ask more than double what the interest would amount to at 6 per cent, to which right is claimed. The reasons consist in this, which no one denies: In 1875 the ratio between the value of gold and silver was almost exactly 16 to 1, the value of gold later having more than doubled that of silver. Now, then, in pesos of silver, and in no other way, were the properties of the Pious Fund valued, and for the value which this money represented, they were sold, and the amount resulting from the sale recogonized by the Mexican Government in favor of said fund. Mexico has never had nor has it now any other standard for its money than the silver peso; its gold money is coined in very small quantity, and is not used to regulate the commercial values. When the claimants ask for interest in so many dollars, they speak of dollars of their own country, as they are there called, with the understanding that they are of gold. The Mexican gold of which they speak is at very slight discount with respect to American gold; but in every case the dollars of Mexican gold are of more than double the value of the silver dollar, in which money only could the interest of the Pious Fund be collected, if they should belong to the claimants.

Therefore, the claim of the bishops of California is usurious in asking, not only 6 per cent on the capital, but much more than 12 per cent per annum.

Another of the exaggerations of the claim is the endeavor to collect, not the half (which is even too much) of the interest on capital, since the other half would have to be applied to the missions in Lower California, but now 85 per cent is asked, because this is the proportion, it is said, between the populations of Upper California of the United States and Lower California of Mexico. Thus it is argued as if it had been intended that the fund should be applied to the entire population and not to the conversion and improvement of uncivilized Indians. This reasoning would only have held good if the entire population of both Californias were of barbarous Indians. This argument, then, can not be sustained, which demonstrates only the zeal, disproportionate in this case, of the attorneys and counsellors of the claimants. In order to comply with the spirit and intention of the founders, the proportion should be made between the unconverted and uncivilized Indians of one of the Californias in comparison with those of the other; and it is now known that in that belonging to the United States, there are not many, perhaps not even one, in that condition.

Another exaggeration of the claim consists in including in the amount demanded the value of the properties that belonged to the Marquis de las Torres de Rada. The value of these properties form, undoubtedly, the greater part of the amount demanded, and there is, nevertheless, no legal basis on which to claim it. This assertion will, no doubt, astonish the claimants, who have made a minute study with regard to the donation of said properties made to the Pious Fund; but it is to be observed that there has very recently been discovered in the general archives of the Republic important data which verify the foregoing statement. These data are contained in the book printed in the eighteenth century, which accompanies the present reply, and whose authenticity will be properly and opportunely proved. In it is given the history of the protracted litigation concerning the inheritance of FR 1902, PT 3—6