'File 14/115 VII Annex (B 9) Abu Musa oxide: collected background material on the case' [‎51r] (112/1904)

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In the case of the particular lease or permit in question, it has already been shown
that the Sheikh Mas entitled to determine it at his discretion. In no sense of
the word cioes the conduct 01 the Sheikh appear to have been illegal.
6 S 1 Ae Company is thereby suffering losses, since they have entered into contracts to
deliver fixed quantities of'iron oxide at a fixed price. In particular, the managing partner
has entered into a contract dated the 1st June, 1906, with the German merchant Herr Robert
Jfonckhaus, of Liiigah {partner in the above-mentioned firm JR. Wonckhaus and Co.), to
deliver certain fixed quantities for four years.
There is nothing in the documents in the possession of His Majesty's Government
to indicate that Hassan Samaiyeh occupied the post of managing partner^ and for I
reasons which will appear more fully below there seems every reason to believe that
Hassan Samaiyeh had no right as against his partners to enter into any such contract
without their knowledge, and that, had they been aware of its terms, they would have
refused their consent. It is clear that when the document was disclosed and the
terms of the contract became known to the other partners they declined to approve it.
The abrogation of the lease or permit has certainly rendered it impossible
for either the Company in whose name Hassan contracted, or for Hassan himself,
to carry out the contract. His Majesty's Government are not fully aware of the
relations between Hassan and the firm of H. Wonckhaus and Co., but they recognize
that it is possible that Hassan's action in making a contract which he was unable to
fulfil may have rendered him liable to Messrs. Wonckhaus in substantial damages.
This, however, is a matter between Messrs, Wonckhaus and Hassan.
7. The information in the possession of the German Government leads them to certain*
conclusions in regard to the motives of the Sheikh of Shargah.
These motives may conveniently be discussed under two headings, (a) the
objections of Esabin-Abdul Latif, one of the partners in the Company formed
to work the Concession granted in 1898, and (6) the objections of the Sheikh himself,
to the terms of a certain contract entered into by the aforesaid Hassan Samaiyeh with
Herr Robert Wonckhaus on the 1st June, 1906.
By this contract (see Appendix, No. 10) Hassan Samaiyeh, w 7 ho is described as
" owner and holder of Bu Musa Concession," gives a the entire monopoly of
Bu Musa oxide to Robert Wonckhaus during the terms of the contract " (savings
certain small amounts duly specified), and, on the expiry of the contract, reserves
to Robert Wdnckhaus the preferential right of renewal.
With regard to point (a), the German Government state :—
It does not appear to be the case that the contract vjas concluded without the agreement
of Esa-bin~Abdul Latif, as the managing partner, Hassan Samaiyeh, immediately on
the conclusion of the contract informed, Esa's father, Abdul Latif, who represented his
son in all matters pertaining to the Company, and Abdul Latif approved the contract in his
reply. According to a later letter of the father, the son appears to recognize the contract
as legally valid, although he would have liked to have seen it before its conclusion, as he
describes its abrogation simply as ' € preferable,* 1 and in a subsequent letter the father
says definitely that he had originally approved the contract on behalf of his son.
The documents referred to in the foregoing statement form Inclosures 6, 8, and
10 in the note from the German Embassy, but the translations of these documents in
the possession of His Majesty's Government (see Appendices, Nos. 12, 16. and 17)
differ materially from those forwarded by the German Embassy, and further letters
of considerable importance are omitted from the German case.
The 1st June, 1906, was the date of execution of the deed of contract between
Hassan Samaiyeh and Mr. Robert Wonckhaus, When, on the 11th June, 1906
(see Appendix, No. 11), Hassan Samaiyeh reported the Agreement to Esa's father,
Abdul Latif, he concealed the existence of what was virtually a monopoly and of the
preferential right of renewal. In his reply, dated the 14th June (see Appendix,
No. 12), Abdul Latif comments upon the transaction in guarded language, and
expressly requests Hassan Samaiyeh to " refrain from entering upon any arrange
ments whatever in the nature of leases or deeds of contract, from which there
will arise difficulties and quarrels."
On the 26th June, 1906, Mr. T. Malcolm, a British-protected sub ject, with whom
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