TWELFTH INTERNATIONAL ECONOMIC HISTORY CONGRESS

ANNOUNCEMENT BY PROCONSUR

To all parties concerned with the Twelfth International Economic History Congress

Seville, 9 June 1998

When Prof. Tortella announced on 18 May the suspension (cancellation) of the Seville Congress, PROCONSUR considered it opportune to delay taking a final position on the matter in order to allow the Executive Committee of the International Economic History Association (I.E.H.A.) first to make its own announcement. PROCONSUR had no wish to precipitate situations which would reduce the margin for manoeuvre of the community of economic historians in recovering control of a situation which was both confused and regrettable.

A note dated 4 June signed by the Bureau of the I.E.H.A. announced that the cancelled Congress had been "uncancelled", and that it would be held in Madrid. As we have received no news from the Executive Committee, we must suppose that the transfer of the Congress to Madrid has received either its acceptance or brought about its resignation. There now exists no reason further to delay the publication of PROCONSUR's own version of events and its final statement.

THE CAUSES OF THE DISASTER OF '98

It is neither easy nor comfortable to explain the events as, when and how they have occurred with regard to the suspension of the Seville Congress. It is not easy, because it is not easy to describe in this short note all that has happened in four years. The explanation is not comfortable, because, due to the unfortunate outcome, everyone will expect a tone of self-exoneration, because of the embarrassment felt in commenting on the details of a lamentable sequence of events, and because there are still many aspects which PROCONSUR does not understand, and about which it has no desire to speculate. But, in any event, those who have been prejudiced have the right to this explanation.

PROCONSUR has advised participants of its communiques to the Executive Committee dated 20 and 26 May, which contain further details relating to this matter. In July 1994, Prof. Tortella and PROCONSUR agreed to co-operate during the following four years in the preparation of the Seville Congress, in accordance with the basis set out in a report prepared by PROCONSUR, which has been seen by some members of the Executive Committee. As there are no institutions offering a coverage similar to that of the Catholic University in Louvain 1990 or the Paolo Bocconi University in Milan 1994, PROCONSUR's offer for Seville also included, apart from the organisation of venues fitting to the distinction of the event, coverage of the economic risks and the considerable amount of work and pre-financing which were required. In this way, Prof. Tortella could concentrate on those functions which by their very nature are not delegable: representation at institutional level and the scientific directorship. As is logical, PROCONSUR set its fees in compensation for the work done, pre-financing and assuming the risks, if the Congress finally generated a surplus, to which end PROCONSUR would also undertake all the work involved in applying for and obtaining external aid.

Until the autumn of 1997, the work schedule was carried out as planned. The participants have criteria to evaluate some of the services provided by PROCONSUR: the publication and mailing of the first and second publicity brochures, the Congress website (until this was blocked in March 1998 by a decision in which PROCONSUR was not involved), information supplied to interested parties, processing of registrations and reservations, etc. Other important aspects, though unknown to many of the participants, were also proceeding favourably. The number of initial registrations and papers submitted were well in excess of previous Congresses, a broad institutional backing was being achieved, and there were optimistic expectations of receiving sufficient external aid. PROCONSUR, as well as supplying the necessary human and material resources, was covering, without raising any objection, all of the external costs generated (printing, travel, etc.), to a total of almost twenty million pesetas.

A reference to the "Fundacion Fomento de la Historia Economica" (Foundation for the Promotion of Economic History), registered by Prof. Tortella on 27 March 1997 is relevant here. The Foundation was originally conceived as an entity more appropriate for the receipt of aid funds than an individual, such as Prof. Tortella, or a private company, such as PROCONSUR. Furthermore, the Foundation would be the depository of the "single account" through which all Congress income should pass, except, for legal reasons, moneys destined to accommodation. All other direct contributions by the participants were to be channelled through the "single account" via PROCONSUR, so that PROCONSUR could carry out the necessary administrative routines (recording and notifying payments, allocations, etc.). PROCONSUR agreed to this system and advanced to Prof. Tortella the greater part of the capital for the incorporation of the Foundation, which he has still not repaid. Prof. Tortella later expressed his desire for the Foundation to replace him as the body legally responsible for the Congress.

The framework established in 1994 was, necessarily, very general in certain aspects which were dependent upon the later course of events. At first, these details were resolved on the basis of the mutual trust between Prof. Tortella and PROCONSUR. The relationship was excellent, at least while there existed a risk, PROCONSUR was providing all services and meeting payments, and no income had been received. But as from the summer of 1997, it became essential to specify contractually these detailed aspects. There now existed the basis for a definitive budget for the Congress, and there was a need to delimit the circulation of the income (which was to begin in the autumn), and Prof. Tortella had to be replaced by the Foundation as the legal entity responsible for the Congress.

These questions were discussed at the beginning of December, on the basis of a draft proposal drawn up by PROCONSUR. Differences arose, as is normal in the negotiation of any contract, but they would not have been irreconcilable, even though Prof. Tortella should now try to blame the crisis on these differences. The true causes of the crisis were quire different. Firstly, there was the attempt by Prof. Tortella, somewhat surprising for an historian, to delete the past. The Professor asked for the contract to be re-drafted as if PROCONSUR had done no previous work for the Congress, and, therefore, with no recognition of rights or consideration for the work carried out. In response to PROCONSUR's surprise at Prof. Tortella's intention to ignore this prior relationship, he wrote, on 6 December 1997, "I do not deny that such relationship has existed, nor that it is evident. It is simply that I have been told that to express it might raise problems."

The second real reason was that, in contradiction of the economic analyses made since 1994, of the objects of the investments made and work carried out, and of his own oral and written statements, Prof. Tortella indicated that the contributions of the participants should be sufficient to cover the costs of the Congress (since 1994, it had been agreed that they should cover less than 40%). Only if Prof. Tortella considered it appropriate, the Foundation (which received all external aid) would supply such additional amounts as were necessary to cover certain costs. Therefore, the scenario was radically different from that considered in 1994, to the obvious prejudice of PROCONSUR, and to the benefit of the Foundation.

This unexpected attitude on the part of Prof. Tortella left PROCONSUR just as disconcerted as the members of the Executive Committee of the I.E.H.A after the suspension of the Congress: we could not believe what was happening. In the midst of this confusion, on 16 December, PROCONSUR asked Prof. Tortella to present a counterproposal, which he promised to do in a few days. Meanwhile, in order to protect the continuity of the Congress, PROCONSUR would maintain all reception functions (information, registration, etc.) although, and until the new framework for co-operation was defined, all work which required competences delegated to PROCONSUR and questioned by Prof. Tortella were postponed (these were fundamentally relations with collaborating Institutions and bodies for the organisation of the venues and external aid).

For a month, Prof. Tortella repeatedly delayed making a counterproposal, but continued to demand services of PROCONSUR as he had done before the crisis. When, on one occasion, he was reminded that the situation was paralysing certain lines of work, and that he could not demand the results of work whose existence he questioned, the tension increased until, in mid-February, relations finally broke down. After making a general condemnation of all of PROCONSUR's work, Prof. Tortella did not now simply deny the past, but, in an attempt to delete its existence, also denied that he had previously delegated to PROCONSUR power to contract suppliers (the hotels had already been advertised), or to negotiate aid or the use of venues with Institutions or other bodies, (although Prof. Tortella personally continued some negotiations initiated by PROCONSUR with the aim of obtaining aid). With this, and although PROCONSUR attempted to maintain an appearance of normality, the preparation of the Congress had been paralysed (except for the publication of the Proceedings), and thus the celebration of the Congress itself was threatened.

That the Congress should go ahead was of prime importance to PROCONSUR, not only because of the work and the money invested, but also due to the commitments acquired before national and local bodies and Institutions. PROCONSUR supposed that holding the Congress was also important to Prof. Tortella, but, knowing him, was at the same time convinced that it would be difficult to change his attitude. PROCONSUR then decided to make all necessary sacrifices in order that the Congress go ahead. Firstly, an offer was made to Prof. Tortella to make an agreed substitution of PROCONSUR with another organiser, but this was rejected. Secondly, the reopening of direct negotiations was requested, also without success. In an interview requested by Prof. Tortella, the Rector of the University of Seville, as host, offered to act as mediator. PROCONSUR accepted the offer without reservations or preconditions. Prof. Tortella, however, declined. Lastly, PROCONSUR requested, with the greatest of discretion, the intervention and mediation of the interested bodies, among them the I.E.H.A., through its Secretary General, Prof. Joseph Goy. Here there was no reply either. It is important to note this demonstrable willingness on the part of PROCONSUR to negotiate and accept mediation, in the face of Prof. Tortella's accusations of inflexibility and excessive demands. Nobody who is inflexible seeks, and unreservedly accepts, offers of mediation. Just the opposite, in fact, there is evidence to show that Prof. Tortella was not interested in any mediation or negotiation, because, AS PROF. JOSEPH GOY AND OTHER ECONOMIC HISTORIANS CAN CONFIRM, PROF. TORTELLA DELIBERATELY PROVOKED THE PARALYSIS OF THE PREPARATORY WORK FOR THE CONGRESS, CAUSING A SERIOUS RISK TO ITS EXISTENCE, BECAUSE HE SOUGHT THE DISHONOURABLE EXCLUSION OF PROCONSUR. HE DID NOT WISH TO REACH ANY AGREEMENT, HOWEVER ADVANTAGEOUS IT MIGHT BE TO HIMSELF, IF THIS MEANT THAT PROCONSUR CONTINUED IN ITS FUNCTIONS. NEITHER DID HE ACCEPT AN AGREED SUBSTITUTION BY ANOTHER CONGRESS ORGANISER, NOR THE LEGALLY MORE HAZARDOUS SOLUTION OF UNILATERALLY RESCINDING THE CONTRACT. HE WANTED PROCONSUR TO WITHDRAW IN SUCH A WAY AS TO MAKE PROCONSUR APPEAR RESPONSIBLE FOR THE SITUATION, THUS DISQUALIFYING ANY ARGUMENTS WHICH MIGHT LATER BE OFFERED. The foregoing statements are made fully in the knowledge that they will be taken into account in the legal proceedings under way.

After Prof. Tortella rejected the Rector's offer of mediation, at the end of March, the deterioration of the Congress became more pronounced. Prof. Tortella communicated directly to the hotels contracted that he considered their prices to be exorbitant, and demanded that they reduce them (participants will see the legitimacy of this claim if they add the price of breakfast and 7% VAT to the prices announced by Prof. Tortella in Madrid and compare them with those advertised in the second brochure). Ill-feeling and complaints arose among the hotels and other bodies.

On 16 April, PROCONSUR received a communication from Prof. Tortella in which he announced his decision to suspend the Congress (PROCONSUR is not aware whether this decision was taken in consultation with the Bureau; it has confirmed that the Executive Committee was not notified). PROCONSUR reminded Prof. Tortella of the seriousness of the decision and reiterated its willingness to make all necessary sacrifices in order to reach an agreement. Two meetings were held, on 4 and 12 May, between Prof. Tortella's and PROCONSUR's representatives, in which the latter went so far as to offer to reduce PROCONSUR's fees for four years' work to ONE SINGLE PESETA. No agreement was possible here, either.

On 18 May, Prof. Tortella distributed a note announcing the cancellation of the Congress. As a result of this note, PROCONSUR received numerous calls from participants requesting the reimbursement of amounts paid. From this moment on, the participants have been able to follow the course of events through the communiquis issued by Prof. Tortella, PROCONSUR and the Bureau, and the public statements via Internet which have been made by numerous participants and some members of the Executive Committee of the I.E.H.A.

PROCONSUR'S FINAL STATEMENT

Once stated its own version of events, PROCONSUR wishes to make known to all persons concerned with the Congress its final position:

1) PROCONSUR does not intend to make any public comment on Prof. Tortella’s announcement of the celebration of the Congress in Madrid, or its compliance with the law and the by-laws of the I.E.H.A. Out of respect for the general interest of economic historians, PROCONSUR does not intend to take any direct action against any meeting which, in any part of the world, contributes to the reduction of the effects of the disaster into which they have undeservedly been led. A quite separate question is the indirect incidence which might derive from the initiatives taken by PROCONSUR in defence of its legitimate interests.

2) Those participants who consider that the second Congress publicity brochure has the value of a contract are right. But it is important to note that such contract has been entered into by each participant and the person responsible within the Congress’s organisation, and not PROCONSUR, which acted as a channel for the amounts paid into the "single account", in accordance with Prof. Tortella’s instructions. The only exceptions are those payments made for accommodation, and which for legal reasons PROCONSUR was obliged to pay directly to the hotels and university residences. All remaining amounts, which were blocked by PROCONSUR in the face of the impossibility of reaching an agreement to transfer them to the "single account", were offered, together with the liquidation of PROCONSUR’s services, to Prof. Tortella by means of a duly attested document on 11 March 1998, which was rejected. Spanish law allows us to retain such amounts until the expenses incurred and services rendered are paid for, and compensation made for the damages suffered as a result of the unilateral cancellation of the contract.

PROCONSUR believes it is necessary to comment on Prof. Tortella’s claim, in a message dated 23 May, that the Managing Director of PROCONSUR had expressly recognised his legal obligation to return these amounts to the participants in a letter dated 18 December 1997, in which he replied to Prof. Tortella’s request that he send said amounts immediately to the Foundation. We quote the sentence referred to by Prof. Tortella, indicating in capitals the text omitted:

"IN A SITUATION AS CONFUSED AS THE PRESENT ONE, I am not even sure whether PROCONSUR has any relationship at all with the Foundation. I am sure, on the other hand, that PROCONSUR bears full responsibility for the deposits which are in its power. I SHALL DISCUSS THE MATTER ON MONDAY WITH OUR LEGAL ADVISERS. WHAT I CAN ASSURE YOU IS THAT YOU WILL BE INFORMED IMMEDIATELY OF ANY MOVEMENTS IN THE ACCOUNTS WHICH TAKE PLACE".

3) PROCONSUR will immediately start to meet its obligations to the registered participants, which are limited to the amounts paid in advance for the reservation of accommodation, under the conditions contractually established in the second brochure. In order that these reimbursements be fully recorded and documented, they will be made by personal cheque which will be sent by post, together with a certification of the total amount sent by each participant. PROCONSUR would request the understanding of those affected in the face of the considerable amount of work involved in the task and the handling of the documents upon which the claims are based.

4) PROCONSUR will send to each registered participant (together with the corresponding reimbursement cheque, where applicable), a certificate to accredit the amount paid to the Congress, the date and means of payment, reimbursement made and amounts pending.

5) PROCONSUR has not processed applications for registration, accommodation and reservations made after 17 April, the date on which it received Prof. Tortella’s notification of his decision to suspend the Congress (although this decision did not become final until 18 May). The amounts paid with these unprocessed applications will be returned in full. With the exception of a few initial cases which will immediately be rectified, PROCONSUR did not make any charge against the corresponding credit cards. Neither has it presented for payment the cheques sent with the applications, and the originals of these will be returned to their senders. In order to avoid arousing alarm, PROCONSUR thought it advisable to delay the return of the corresponding bank transfers until the situation was clarified, and will now proceed to return the amounts of said transfers.

6) The certificates issued by PROCONSUR on the amounts sent and pending will serve as proof for the claims that each participant deems appropriate. As stated above, such claims should be addressed to Prof. Tortella as President of the Congress (not to the Foundation, which does not appear in the brochure-contract). Obviously, Prof. Tortella has not seen (and has never asked to see) paper copies of the bank documents relating to the transfers, however, he does have at his disposal all of the necessary information on computer files. He will not have any trouble in verifying the data which appears in PROCONSUR’s certificates.

7) PROCONSUR reiterates its regret at the unfortunate outcome of the Seville Congress and the prejudice caused to the international community of economic historians. The economic and moral damages suffered by PROCONSUR as a result of these events are incalculable. Neither does it seem probable that Prof. Tortella gains any advantage from the situation. For these reasons, and despite the proximity of the events, PROCONSUR also shares the perplexity of many participants at the final outcome.

PROCONSUR, S.A.

Av. San Francisco Javier, 15-4* planta

41018 - Sevilla

Tlf.: +34 5 4922755

Fax : +34 5 4923015

Proconsur@svq.servicom.es