CO129-592-5 Reports on current situation- custody of enemy property 7-12-1945 - 11-12-1945 — Page 5

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even provisionally

Others no consideration passed; in others the transaction is a forgery e.g. in one case the alleged seal of the payee proved to be the payee's

own seal. Further, in cases where consideration passed or is alleged to have passed, it was sometimes so inadequate as to raise the presumption

that some interest was reserved to the guarantor. It may be sometime, therefore, before the rights of the parties can be

determined and presumably final determination will have to wait for

restoration of Civil Courts. Until directions are obtained, the

Custodian has been told to take such property into custody under

Article 3 of Proclamation No 11, but as soon as it is ascertained

even administratively that the property is "Enemy Property", I suggest

that he should then apply the Trading of the Enemy Ordinance.

8.

No directions have been received as to how that Ordinance should

be applied; in particular how far assets subject there to should be

liquidated. It is suggested that any property required by the

Administration or for rehabilitation purposes should be requisitioned,

payment being deferred, and that all properties which cannot profitably

be taken into custody, should be sold and the proceeds credited. I

have already sanctioned the sale by auction of a China and curio shop

of which the owner is known as apart from the strain on transport and

storage, moving the goods would almost certainly lead to a large

quantity being broken.

9.

It would be of considerable assistance if the intention of

His Majesty's Government with regard to en emy, property were now di-

vulged

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whether e.g. such property will be applied towards reparations

or making good war damage leaving the owners to claim against the

Japanese Government or whether it is proposed to return it to the

owners.

10. It is already known that so far as Japanese war material is

concerned including food and fuel the ultimate destination is already

covered by agreement. I attach a copy of a draft of such agreement.

11. It is not however known what is the ultimate destination of property

falling outside such class. Perhaps the Board of Trade could be asked to

give instructions.