British diplomatic and naval officers clashed with those of the United States until, in their search for complete control, both exceeded the instructions which they had received from home.

The British occupied Greytown on the San Juan and supported the Mosquitoes and Costa Rica.

The Americans won favor in Nicaragua and Honduras, framed treaties allowing transit and canal construction, and proposed the annexation of Tigre Island, which, commanded the proposed Pacific outlet.
To untie these knots, Sir Henry Bulwer was sent to Washington to negotiate with John M.Clayton, President Taylor's Secretary of State.

Neither of these negotiators was of the caliber of Webster and Ashburton, and the treaty which they drew up proved rather a Pandora's box of future difficulties than a satisfactory settlement.

In the first place it was agreed that any canal to be constructed over any of the isthmuses was to be absolutely neutral, in time of war as well as of peace.