Colonial Despatches

I have the honor to report for the information of the Duke of Newcastle that in pursuance of oral instructions received through Sir F. Rogers I had an interview on the 11th instant with Mr Dallas the Colonial representative of the Hudsons Bay Company and Mr Maynard the Company's Solicitor on the subject of the proposal made by Governor Douglas in his despatch of the 6th May last for the settlement of the Land claims of the Company in British Columbia.

2. The details of this proposal with the modifications thereon suggested by Mr Dallas in his memorandum of the 15th ultimo were fully discussed, and I feel bound to add in the most candid and liberal spirit by Mr Dallas and Mr Maynard. The results at which we arrived are embodied in the enclosed Memorandum which we made at the time, and which has since been seen and assented to by Mr Dallas as a satisfactory arrangement for the final settlement of all the Company's outstanding Land claims in British Columbia.

3. I fully explained to these Gentlemen that I had no authority to bind the Government to this arrangement, and could only report it for the consideration of the Duke of Newcastle.

4. Being fully aware of the desire of the Duke of Newcastle that a liberal construction should be placed on the Companys claims, my principal aim was to reduce what was vague and indefinite in them to as much precision as practicable, and thus to save future references to and from the Colony, and to facilitate an immediate settlement so desirable on all accounts. With this view too, provision has been made for determining on the spot by arbitration any subordinate questions that may arise.

5. Under the proposed arrangement, the whole quantity of Land to be conveyed in fee to the Company in satisfaction of all their claims will not exceed 2913 Acres. But the Company are to have the liberty of purchasing within Six Months and in one locality only, vizt at the Farm near New Langley at 4s/2d an Acre (the present minimum upset price of Lands in the Colony) an additional quantity of Country Land not exceeding 1500 Acres. This completely, and I think satisfactorily disposes of the proposal in Mr Dallas' memorandum of 15 August last that the Company should have "the right of purchase at the minimum price of all or any portion" of their claims. All money and other Land claims not mentioned in the accompanying memorandum are also disposed of—and provision is made as suggested by the Governor in his despatch 88 of the 11th Jany 1861, for granting an equivalent in Land should any of the Lands intended to be now conveyed to the Company be found to have been irrevocably alienated.

6. The enclosed Table will show the extent of the Company's claims as originally put forth in an Enclosure to the Company's letter of 31 May 1859 amounting to upwards of 98000 Acres, the extent of the concessions suggested by the Governor in his despatch of the 27th August last, the Company's proposed modifications, and the results of the present arrangement.

7. Should the Duke of Newcastle approve of the terms now laid down, it will be probably thought advisable to communicate them for the formal acceptance of the Company, and when that is received, to forward them to the Governor with instructions to carry them out as promptly as possible.

8. I would also suggest that the Arbitors should at once be named (no better person on the part of the Government occurs to me than Colonel Moody) and that the Governor should be further instructed to convey to the Company the lands at each locality as fast as the boundaries &c are determined, taking care that in each deed it is clearly made to appear that the grant is in consideration and full discharge of all the Company's claims against the Government in that locality.