6
communication was clearly also made on the footing that if the
Nationalist/American side took proper steps injunctions
would remain in force freezing the aircraft at Hongkong until
the last appeal had been exhausted and the matter was finally
decided.
4th January Chinese Nationalist Ambassador put in a note to
the Foreign Office atating:-
(1) that the 20% Pan-American interest in CNAC had been
transferred to CAT. INC;
(2) that CAT. INC. now re laced CAT (Chennault and Willauer);
(3) that the Republic of China had sold to CAT. INC. all
assets of CNAC and CATC.
This was telegraphed to Hongkong.
January 4th. General Donovan, who had been retained by Chennault
and Willauer to endeavour to secure the release of the
CNAC and CATC property, went to see the Governor of Hongkong
accompanied by U.S. Consul General. In an interview
which lasted fifty minutes, General Donovan informed the Governor
that the Foreign Office had received from the Chinese Embassy
a certificate certifying the sales of the 'planes to CAT. INC.
The Governor said he had heard something of this but the
whole question as to the title to the 'planes was sub judice.
He said he would, however, be advised by the Attorney General.
Later in the same day Donovan and Hepner went to see the
Attorney General. The Attorney General asked why cases Nos.
1, 2 and 3 were not bein proceeded with. General Donovan
replied that these cases were now "dead from the neck up" in view
of the sale of all the assets of CNAC and CATC to American
interests. The chief point made by General Donovan in a long
and far from pleasant interview was that the certificate by
the Chinese Nationalist Government that the 'planes were now
the property of CAT. INC. ought to be regarded as conclusive
of all legal issues, ao conclusive that the Governor of Hongkong
could disregard the injunctions made by these courts which
were still in force and could, and should, by police action if
/necessary