'File 14/115 VII Annex (B 9) Abu Musa oxide: collected background material on the case' [‎62r] (134/1904)

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secure for their trade and traders a fair field and no favour. I replied that those two
premises being recognised, it would seem quite possible to settle the case speedily by
some friendly compromise, and that 1 hoped that this course would be attempted.
Count ^ Quadt professed to be surprised and pleased to know that as local official
I did ijCc- hold tiiat view ? and joined in the hope that the controversy would find
settlement in that way.
Count Quadt is habitually fair in speech, but is believed to be not quite so amicably
inclined in practice, and the fact that the German rejoinder, presented two months
later, offers no suggestion of compromise, makes it possible that they may not prove
amenable to a speedy give.-and-take settlement; but I have thought it as well to
mention the above conversation, as it was in a similar frame of mind as regards the
question of compromise that I approached the present German communication and
subsequently discussed the position with Mr. Hurst.
Before commenting on points of the latter s minute, I beg to offer some preliminary
observations from my own point of view upon the general tenor of the German
rejoinder of the 3rd January, 1910. Detailed comment I have recorded separately.
They have evidently taken a great deal of trouble over it, and it reads well if read
by itself; but if it is examined by the light of what has gone before on the record, it will
be found, I think, that most of the arguments used are simply repetition, and are already
answered, while the fresh evidence adduced is either impugnable, or does not seriously
affect the principal grounds of our case. They quote one document (to which I refer
in a separate memorandum of detailed comment hereto attached)—-the grant of a lease
of mica or gypsum deposits by Salim—which y if in order and known to the ruling
sheikh, would show that Salim made grants as tenant at will, as well as qua regent,
but none of the German arguments appear to me to shake our contention that Balim
was not the private owner either of the island or the mines, but simply enjoyed the
usufruct at the ruling sheikh's will, and subject to resumption at any moment.
When we first took up this case with the G-erman Government we endeavoured to
insist on the premise that it was for the present purely commercial in its aspect; that
Wonckhaus should put in his claim against Hassan, or the concessionnaires generally,
for breach of contract; and that until he had taken that course there was no justifica
tion« for going behind the commercial elements of the case and bringing it on to
political ground.
I hope we can still maintain this attitude.
It is clear, however, from the present German communication that they are anxious
to push the political aspect of the case as much as they can, with an appeal to The
Hague if they do not get what they want—-a proceeding which would delay settlement
indefinitely.
In fact s appear to have arrived precisely in the position anticipated in my
despatch of the*28th December, 1907, from the Foreign Office to the India Office The department of the British Government to which the Government of India reported between 1858 and 1947. The successor to the Court of Directors. , the
paragraph commencing
a If the German Government argue that the legality of the sheikh's action would
be very suitable matter to refer to arbitration, . . . ."
I beg reference to that despatch, and presume that were the dispute to be pursued
on existing lines we should adopt one of the alternative courses of action adumbrated in
the paragraphs following the passage above quoted ; and that we should ultimately
agree to grant or get Wonckhaus some compensation, either from Hassan Samaiyeh or
the concessionnaires as a whole, or from the sheikh, as we might feel called upon.
The object of the sheikh and ourselves was, not to prevent Wonckhaus from
trading in Abu Musa oxide, but to prevent his getting a monopoly and a footing on the
island; and to gain this object it was foreseen that compengation might have to be paid ;
and no doubt it will; but our original purpose, the prevention of a monopoly and of
German interference on Abu Musa Island, will have been attained.
It seems to me that we cannot possibly admit the validity of the colourable
transfer of a share in the concession itself (after cancellation) to Wonckhaus, and a
consequent right of Wonckhaus to sue the sheikh as one of the concessionnaires.
To concede this would be to concede that the cancellation by the sheikh was invalid
and greatly to weaken and complicate our case.
But in any case it is clear that if the controversy is pursued on the lines
hitherto employed, the preparation of a detailed reply to the present German
rejoinder will occupy many weeks, if not several months; while it' the case is ulti-
mktelv taken to The Hague, years may elapse before final settlement is arrived at.
Meanwhile, the oxide industry from Abu Musa will be suspended, Salim and Sheikh