Prior to the nineteenth century, there appears to have been no question regarding the titles of property held by the Church in Spain or in Cuba. But in the beginning of that century, the property held by the Church in Spain was confiscated by the State. This confiscation however, related only to the Church possessions in Spain and did not affect her insular possessions.

In 1837, Captain General Tacon sought to make this Spanish confiscation act applicable to the holdings of the monastic orders in Cuba, and in 1841, Valdés, who was then governor, actually seized these properties and diverted them to the uses of the State. Among these seizures were the convent of the Franciscans, which has been used since then as the Custom House; the convent of the Dominicans, used for a time by the University of Havana; the convent of the Augustinians, used as the Academy of Sciences; the convent of San Ysidro, used by the Spaniards as military barracks, and later by the Americans, as a relief station.

Up to the time of the American occupation in 1898, these and other valuable properties, formerly held by the Catholic Church, had been held by Spain, subject to the results of a long series of negotiations between the Crown of Spain and the Holy See.       

                                                                                                                          Convent of San Francisco

The Spanish Government also held a large amount of censos, or mortgages, upon property in different parts of the island which had been given to the church for religious purposes, but which had been taken over by the State for purposes of administration. The Crown, however, annually paid the Church a large sum for its maintenance.

With the American occupation these annual payments ceased, and the American Government continued to use the property for the same governmental purposes to which it had been put by the Spaniards. The Church thereupon claimed the right to take back the property. This gave rise to a long discussion and investigation, until the whole matter was finally referred to a judicial commission in 1902. This commission decided in favour of the claims of the Church, and the matter was adjusted to the satisfaction of all.

The government of Intervention agreed to pay a rental of 5 per cent. upon the appraised value of the property, which amounted to about $2,000,000, with a five year's option to the government of Cuba, when organized, to buy the property at the appraised value, receiving credit against the purchase price for 25 per cent. of the rental paid; and the matter of the censos was adjusted by the Government of Intervention taking them at 50 cents on the  dollar and permitting the debtors to take Church of San Agustin c.XVII         them up at the same rate.