CO129-606-5 Hong Kong Loan- Financial settlement 2-3-1948 - 4-10-1948 — Page 78

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matter was again referred to in para. 6

of our telegram No. 589. It is clear

therefore I that all that has been

agreed to by H.M.G. is that the Service

Departments should expedite the

examinati on of claims and decide in the

Ear case,

and

The facts

MA

light of their existing practice to what

extent they can properly meet the claims

- see para. 3 of our telegram No. 533.

J. appear.

I assume that this examination has now.

been completed and it should now be clear

to what extent the claims in question can

be met by U.K. departments. For the rest

Lave to any liability which may be admitted must

lie against the Hong Kong Government and

not against H.M.G. It is therefore

somewhat unfortunate that the question

accen

Lane

should be complicated by a suggestion of

dividing up the "total losses" in varying

percentages amongst the three Service

departments. In view of the correspondence

referred to above I am quite certain that

no purpose would be served in submitting

such a proposal to the departments concerned

To sum up H.M.G. must regard the

financial settlement as final and cannot

agree to accept responsibility for meeting

any further liabilities of the nature

referred to. Whilst your difficulties

in this matter are recognised, it must be

borne in mind that the settlement was

accepted locally even after the confusion

referred to above had been cleared up.

Moreover liabilities of a similar nature

had been accepted by the Malayan Governments

without question.

There is perhaps

/an