1074 North America

Hudsons Bay House
Septr 7 1846
My Lord
The annual ship of the Hudson's
Note to Sir John Pelly 21 Septr 
Note to Sir J. Pelly 3 October 1846
Bay Company to the Columbia and North West Coast of America is now loading, and will be ready to sail about the middle of this month. By this opportunity the Company send out their instructions for the information and Hudsons Bay Company instructions to officers guidance of the officers in charge of their interests in that quarter. 
The treaty for the division of the Oregon Territory having been concluded, I conceive that all questions respecting the possessory rights of the Hudson's Bay Company and of all other British subjects who may be already in the occupation of lands or other property, as stated in the third Article of the treaty; or respecting the lands, farms and other property of every description belonging to the Puget Sound Agricultural Company, as mentioned in the fourth Article (the whole of which is on the South side of the line of demarcation, viz Lat. 49) will be referred to the Secretary of State for Foreign Affairs; but that questions relating to settlement in the territory on the North side of the boundary line (now exclusively British) will belong to the Colonial Department, over which Your Lordship presides. 
Assuming that I am right in this opinion, I now address your Lordship with the view of ascertaining the intentions of Her Majesty's Government as to the acquisition of lands, or formation of Settlements, to the North of Lat. 49. 
The Hudson's Bay Company having formed an Establishment on the Southern point of Vancouver's Island which they are annually enlarging, are anxious to know whether they will be confirmed in the possession of such lands as they may find it expedient to add to those which they already possess. 
With regard to the question of trade, your Lordship is aware that the Company, by a grant from the Crown, dated May 13 1838, have the exclusive right of trading with the natives of the Countries west of the Rocky Mountains for 21 years from that date. 
I have the honour to be
My Lord
Your Lordships Obedient
humble Servant
J.H. Pelly Govr
To the Right Honle
The Earl Grey
&c &c &c.
Minutes by CO staff
This letter was brought to me today by Sir J.P. to whom I have promised an early answer — before I determine what answer is to be given I wish to know what observatns Mr Stephen has to offer.  
G.
7/.
In order to the right decision of the question here proposed by the Hudson's Bay Company it will be necessary to refer to their Charter, & to the Grant of May 1838. My memory (erroneously perhaps) suggests to me that the right of Colonization is not only not conceded to them but is expressly reserved to the Crown: & that the grants to the Company vest in them the rights of trading only. I wish however that the papers should be collected before my return to London.  
JS
8. Sepr. 1846.
Mr Stephen
The Papers are annexed.  
VJ
9 Sepr.
12 Sepr.Mr Hawes
It is scarcely possible to determine what are the limits of the Territory of the Hudson's Bay Company. But I suppose it to be quite clear that Van Couver's Island and our part of the Oregon territory are not within those limits. The Company have no proprietary or other rights there, save only the right which they derive under the License of the year 1838 for 21 years to trade exclusively with the Indians and to carry on the Fur Trade. But that License expressly reserves to The Crown the right of founding Colonies & of Establishing any form of Civil Govmnt within the Territory comprized in the License. Consequently the Company have no right, in strictness of Law, so far as I can perceive, to any Land in Van Couvers' Island or elsewhere, westward of the Rocky Mountains, and there may be serious difficulty in assenting to the application they now make. It wd., I think, be hardly consistent with the terms of their Charter. It wd. be very unusual to grant Lands to any Company or indeed to any one else in the vague and comprehensive manner here suggested and without any previous Enquiry. Probably also the United States' Govmnt. wd. object to such an Act. The Company at the date of the Treaty of Washington has no Proprietary or other rights in the Oregon Territory save only under the License of 1838 which License must expire in 1859. Now the Treaty which gave to British Subjects the right of Nav Navigating the Columbia in order to trade with the Company, and which declared the Navigation of the River free to the Company must, I presume, be understood as having been made with full knowledge of the fact that the Company's rights Westward of the Rocky Mountains will expire in 1859. Now to give to that Company a new interest & title in Lands in those regions wd. be said to be an attempt to prolong beyond 1859 the right of Navigation. Whether this objection wd. be well-founded I do not undertake to say. All I wd. suggest is that caution shd. be used in laying any ground for it. 
JS.
12 Sep
1074
Hudsons. Bay Cy
Ld Grey
In consequence of the Settlement of the Boundary between the U. States & Gt. Britain by the Ty of Washington, the Hudsons Bay Company now apply to learn the intentions of the Govt.
  1. As to the acquisition of Lands in the promotion of Settlements north of the 49th paral.
  2. Whether they will be confirmed in the possession of Lands in the southern part of Vancouvers Island & whether they add to their possessions there.
 
I imagine whatever the grant originally to the H.B. Company — it could not be considered to extend to any portion of the Oregon territory or to Vancouvers Island — which was only discd long after the original grant. And I therefore agree with Mr Stephen that the Company under either their Charter or their License could not acquire any proprietary rights in these parts. 
Within therefore the now known Boundaries of Brit. Territy north of the 49o it will be for the Crown, in any future of that territory westward of the Rocky Mountains including Vancouvers Island to grant or Sell, or confirm holdings or occupations of, Lands at its discretion. 
For this purpose the Company must I apprehend make a formal application to Ld. Grey — stating what the require for the purpose of their Trade under their License. Till that is done no answer can be returned to their present Letter. They moreover must shew what they alledge they possess —& their title to it. I do not doubt, any application they make will be fairly & liberally considered. But South of the Boundary, I imagine as the Company indeed does, Ld. Grey can neither grant nor confirm anything. All such possessions & claims appear to be provided for by the 3d. Article of the Treaty & must be brought under the consideration of the Foreign Office. But there is one portion of Mr Stephens minute which implies of it to not express an opinion, in which I cannot concur. But I may have misunderstood him. 
I quite agree from such inspection of the Charter & License as I have been able to give it — that the Company has no proprietary rights & could have none, Westwd of the Rocky Mountains, Vancouvers Island included. But I do not agree that they can acquire none if the Crown see fit now to grant them. Neither do I see any thing in the Treaty to restrict the power of the Crown if it see fit to extend the License of the Company. Now I understand Mr Stephen to be of opinion that to give the Company "a new interest & title in Land in these regions would be said to be an attempt to prolong beyond 1859" (when the present license expires) "the right of" the free navigation of the Columbia:— because the right of freely navigating the Columbia was conceded to the Hudsons Bay Company "with the full knowledge of the fact that the Company's rights Westwd of the Rocky Mountains expired in 1859." Now I imagine it is not by what was understood by the Negotiators (if indeed anything was understood on this point) but by the Treaty we must abide. By the 2d Article the great north Branch of the Columbia was to be "free & open to the Hudsons Bay Compy & all British Subjects trading with the same" This Company has existed under Charter & Licence since 1670 to the present time — & so long as the Crown continues the Charter or License — so long the Hudsons Bay Company &c can claim the free navigation of this River, subject to the provisions of the Treaty. 
I see nothing in the Treaty to justify the extinction of the Company or its Charter in 1859. Nor can I think this was contemplated — though I fully expect from the language of the Treaty American diplomatists will well contend for it. 
The Province of Canada lost the free navigation of the Mississippi by a geographical blunder. The Hudsons Bay Cy & the subjects of England trading with it may lose the free navigation of the Columbia by diplomatic omission of a clear and express reservation of rights. 
The greatest of Modern Statesmen have attached the greatest importance to the free navigation of Rivers, forming the Boundary of States, or running through successive independent States & that opinion is recorded in a very remarkable article in the Treaty of Vienna in 1815. England has clear rights under that Treaty regarding the Navigation of the Rhine, which in these days of free trade — it may be well in some future occasion to recall to mind. 
However, I conclude by venturing to express an opinion that the Crown may consistently with the Ty of Washington renew if it see fit the Hudsons Bay Cy.'s License & thus secure & perpetuate the free navigation of the Columbia, be it worth much or little. 
I imagine therefore that the answer to the Company's Letter must be that Lord Grey is at present advised that the Cy have any Proprietory rights westward of the Rocky Mountains Vancouvers Island included. That without further consideration he cannot give any answer to the present application, especially without having from the Company the nature of their alledged title to lands within these regions, which under their Charter or their License it does not appear they could acquire. 
That as to any future disposition in which a grant of Land within the now ascertained territory of Gt Britain in these regions — that must be reserved also for further consideration (I merely add — that it may not be quite certain whether though the Boundary between the United States & Gt Britain is settled — that the Russian Boundary between England & Russian possessions is necessarily settled) 
BH
This is a very difficult & important questn. Looking to the encroaching spirit of the U.S. I think it is of importance to strengthen the Bsh hold upon the territory now assigned to us by treaty by encouraging the settlement upon it of Bsh subjects; & I am also of opinin that such settlement cd only be advantageously effected under the auspices of the Hudson's Bay Co. wh. I am therefore disposed to encourage — But certainly great care must be taken in adopting any measures with this view to avoid any irregularity or informality — Instead of writing a letter throwing a doubt on the right of the Co. to Lands they now occupy, the best course I think wd be for Mr Hawes & Mr Stephen together to hav have an interview with Sir J. Pelly in order to ascertain clearly from him what rights the Co. claims — what they now wish to have done — & what measures may most safely & properly be adopted with a view to establishing more Bsh settlers in this territory. 
Inform Sir J.P. that before any G. 16/ official answer is sent to this letter I wish to have some further explanatn upon the subject, that as I am leaving town it is not in my power myself to see him but that I shd be obliged to him if he would call here & afford to Mr H. & Mr S. for my informatn the explanatn whi seems necessary. — 
G.
16/9
24 Sepr
Mr Hawes
I make for your concurrence or correction, and for Lord Grey's information, the following note of what occurred, when in pursuance of his Lordship's directns, you and I met Sir John Pelly at this Office yesterday.  
It appeared from his answers to the questions proposed to him — 
1st. That the Hudson's Bay Company are not able to define the extent of their Territory otherwise than by stating it to comprize all the Lands watered by the Rivers falling into Hudson's Bay 
2d. That they have no rights whatever in the Countries west of the Rocky Mountains, save only such rights as they derive, First — from their general powers of Trading with all Indians in North America and, Secondly, from their Special License to carry on, till the year 1859, an exclusive Trade in the Oregon TerritoryThirdly 
3d. That it is very doubtful whether the Act of Parliamt, under wh: that License was granted &. the Company's acceptance of that License, and the transactions of The Crown with the North West Company have not reduced the rights of the Hudson's Bay Company within, what may now be called, British Oregon, to the Single foundation of the Act of Parliamt and the consequent License — so, that, after the Year 1859, the Company wd have no rights at all in any British Territory West of the Rocky Mountains, save only such rights as save only such rights, if any, as may now, or hereafter, be conferred upon them 
4th That the Hudson's Bay Company have certainly no right to the Soil in the British Territory West of the Rocky Mountains, or to any part, however inconsiderable, of that Soil. 
5th. That it is very doubtful whether consistently with their Charter, the Company could accept a grant of any such Lands — 
6th That, therefore, it wd be better that whatever may be granted, shd be so granted, not to the Company, but to a Subordinate Association which the some Members of the Company have formed in their personal and independent characters, & to wh: Association really belong all the Possessions of the Company in American Oregon
7th That the real object and wish of the Company is not to have any grant of Land either to themselves or to the Association, but merely to have an Assurance that if Vancouver's Island shall, hereafter, be brought within, and under, any Colonial Govmnt; and if the Company or the Association shall then appear to possess the requisite Legal competency to acquire and hold lands within the limits of any such Govmnt, then a Grant shall be made to them of the Lands they have already occupied, and, further, that they shall not, in the interval, be disturbed in the occupation of them. 
8th To this is to be added that the Company have no Map or other means of showing what the Lands which they have so occupied are, nor what the exact extent of them may be, though it is not supposed to exceed 1,000 acres. 
9th Sir John Pelly had no definite plan for Colonizing the Country, but expressed his readiness to concur with any other persons who might be interesting themselves on the subject in devising such a plan. 
From these Statements it may, I think, be concluded that the right answer to the present application from the Company is that their first step must be to specify, with greater distinctness, what is the particular Territory to which their application refers, and to state whether they are of opinion that the Hudson's Bay Company are legally capable of becoming owners of those or of any other Lands in H.M's Dominions west of the Rocky Mountains. This last enquiry will lead to a statemnt regarding the Association of which Body we have, as yet, no knowledge, save only as far as it is derived from Sir John Pelly's conversation. 
Am I right in supposing that the Company's letter is with you? 
JS
Sep 24
Ld Grey
I join in Mr Stephens Statement which exactly gives you an account of all that passed at the Interview. Outside the immediate subject of discussion one or two points arose which are of sufficient general importance to be recorded. 
1.  The Climate appears good. Sir Jno Pelly compared it to that of England. He was speaking of the Settlements of the Company at Vancouvers Island
2.  That they grow & export corn & wool & had supplied the American settlements in the Willamette & as I understand had contemplated supplying the French settlements in the Pacific. The Company at one Farm had 10,000 Sheep & a large number of Cattle. 
3.  That the Cy had sent out Agl Implements ploughs &c and had advanced the Capital necessary for the Settlers & was willing to advance more. 
4   That the harbour of Vancouvers Island was capacious — that Coal had been found in the Island — & that it presented many advantages for a Naval Station. This he considered of great importance in the event of the U. States acquiring the harbour of San Francisco
BH
These facts are of considerable importance & will make it necessary soon to consider what is to be done as to colonizg this territory — in the mean time the ansr suggested by Mr Stephen shd be sent. — 
G.
25/
Other documents included in the file
  • Draft, Colonial Office to Pelly, 21 September 1846, asking that he attend a meeting on Wednesday next to provide further information. 
  • Copy, Hawes to Pelly, 3 October 1846, asking that more complete information be provided regarding the extent and limits of the territory in question and the position of the company or corporate association regarding their right to hold land west of the Rocky Mountains
 
Footnotes
  1. The Puget Sound Agricultural Company (PSAC) was a joint stock company established by the HBC in 1839. Ostensibly at arms length from the HBC, it was practically, if not legally, an extension of the HBC. Its board of directors consisted of all the top brass at the HBC—Governor Pelly, Deputy Governor Colville, Sir George Simpson—and the majority of its shareholders were HBC employees. It's purpose was twofold: increase HBC profits through agricultural sales, and more importantly, provide a means for the company to bring British colonists to the disputed Oregon territory, and, it was hoped, bolster British claims to fix the border along the Columbia river (and not at the 49th parallel), thus keeping HBC operations in British territory, where its monopoly, and profits, would be protected (John S. Galbraith, The Hudson's Bay Company as an imperial factor, 1821-1869 (New York : Octagon Books, 1977, c1957), 192). 
    The PSAC was headquartered at Fort Nisqually at the southern end of Puget Sound, in modern day Tacoma, in 1839. By 1845 it was home to over 5872 sheep, 2280 cattle and 228 horses, but only a handful of colonists. Crops were grown south of Nisqually at Cowlitz Farm, on a tributary of the Columbia
    As an agricultural venture the Puget Sound Company was a modest success, meeting the needs of the HBC locally without having to resort to costly imported goods and occasionally selling to the Russians, American settlers and visiting ships (217). As a means of supporting both the interests of the British government and HBC shareholders it was an abject failure. Fundamentally, the HBC was a fur trading monopoly, and remained so in the mind's of its leadership. The maintenance of this monopoly was inherently inimical to an agricultural colony. For them the fur trade required wild spaces—too easily spoilt by uncontrolled colonists, and so the terms the company gave to colonists were unfavourable, and few ever came courtesy of the HBC and its Company (210). 
  2. This addressee information appears at the foot of the first page of the despatch.
  3. Memorandum by Benjamin Hawes.
Public Offices document: Pelly to Grey, 7 September 1846, 1074, CO 305/1, p. 1; received 7 September
Last modified: 15:44:36, 1/4/2014