No. 59
17th May 1871
My Lord,
I have the honor to forward to Your Lordship a communication from the Liquidators of the Queen Charlotte Island Coal Mining Company with its enclosures, relating to a claim whichtheyManuscript image they prefer for a Premium, offered in what appears to me to have been a somewhat irregular manner,
Stupid, but qy irregular?
by the Government of the former Colony of British Columbia, for the first shipment of Two hundred Tons of Coal from the Colony.
2. I have not regarded myself as at liberty to recognize the validity of this claim, nor felt thatI oughtManuscript image I ought to recommend it to the recognition of the present Legislature of the now United Colony.
3. No provision of any fund for the payment of this Premium was ever made by the Legislative Council. At the time when it was offered the Mainland of British Columbia formed a government separate from Vancouver Island, whichalreadyManuscript image already possessed Coal mines in successful operation; and the object in view was to establish a rivalry. The Premium was not claimed before the Union of the two Colonies, nor until Six Years after the date of the Notice in the Gazette.
Not a good plea.
The present Legislature is constituted differently from the Council by which it was authorized.
Not admissible.
And the Coal in respect ofwhichManuscript image which the bonus is claimed, shipped in 1870, does not now answer the description of "the first Coal shipped from the Colony."
Qy is there anything in this?
No fund had been specially provided,
No occasion until required.
and I regarded the offer of the Premium as having lapsed from efflux of time
Not admissible.
or being revoked by the subsequent change in the condition and circumstances of the Colony, and no longer as bindinguponManuscript image upon the present government.
4. I do not view with favor the principle involved in the payment of such Premiums.
Probably this is too large a condemnation of the previous system.
They do not induce or sustain any enterprise which will not otherwise be found profitable. The history of this Coal Company which is now in liquidation is an example in illustration.
5. In any case the amount could not now bepaidManuscript image paid without a reference to the local Legislature for authority at the next Session after Union and this has been pointed out to the applicants.
Where? He refuses (last par of enclosure K) to refer the claim to the "next Legislative Council."
(There has been an intermediate Session since the date of that letter 23 Decr/70.)
I have the honor to be,
My Lord,
Your most obedient
Humble Servant
A. Musgrave
Minutes by CO staff
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Mr Meade
In 1864 the Legislative Council of B. Columbia (before the Union with Vancouver) offered a premium of £500 for the 1st 200 Tons of good Coal produced & shipped from the Colony.
In April 1870 Queens Charlotte Coal Cy (at least the liquidators on behalf of) ask what proof the Govt require to enable them to submit their claim to the £500.
The Governor meets this byManuscript image saying that "the present Legislative Council of the United Colony is not responsible, nor the Govt nor are there any Funds from which the payment could be made." & again "if there had ever been any legislative enactment the engagement would undoubtedly have been binding—that the difficulty is that there is no such enactment or legal provision & His Excellency can only presume that the Legislature & the Govt regardedManuscript image the offer as having lapsed from efflux of time & that their was no doubt the circumstances of the Colony had changed since the offer was made" & again "His Excl. has no legislative Authority for making the payment & is expressly forbidden by his instructions from making payments without such authority."
I do not feel that that is quite a fair way of meeting the claim. The offer was a very ill advised one probably, but still it was made & had never beenManuscript image rescinded, & I should have thought it was just as binding on the United Legislature, as it would have been on the Legislative Council of B. Columbia before the Union.
I think that the Govr ought to have told them to submit their proof & that on being satisfied of its correctness to have submitted the claim to be dealt with by the Legislative Council.
But before any answer to this could reach the Colony the Union withManuscript image Canada will be fact so that it will remain with the new local Govt to dispose of the claim, & with that Govt this Office will have no communication.
I take this opportunity of asking whether any further dispatches should be addressed to & be sent to the Govr?
CC 20 June
A Vote for this £500 cannot now be got before Union with Canada, and I presume therefore the claim will have to be addressed to the Dominion Govt. On the broad merits of the case I think that as no condition as to time was made, the claimants are entitled to what they ask. The proclamationstatesManuscript image states finally that the Governor in Council is to be sole judge whether the premium is to be paid.
I presume we must continue to address despatches to the Governor until we hear by Telegraph or otherwise that the new machinery of Govt is in actual operation?
The Govt may find other claims made upon them on account of the premiums offered for gold, silver & for shipbuilding.
RM 21/6
This is a very unsatisfactory case, & to my mind the Governor has dealt wrongly with it. When the premium was originally offered it should have been subject to conditions as to time &c, and the necessary vote for the amount should have been placed on the estimates & included in the appropriation Act. The question should have been brought from time to time before the Legislature & the public as to the withdrawal or renewal of the offer,thoughManuscript image though I apprehend there would have been difficulty in receding at any time from the terms of the Proclamation once issued as parties could, if the withdrawal of it were mooted, protest that they had been expending time & money for years in the attempt to earn the premium, and were on the point of succeeding, &c.
But as the matter stands it seems to me that Govr Musgrave's act is distinctly one of repudiation. I do not exactly know to what he refers when he says (inclosure I last par) that "he is expressly forbidden by his instructions from making a payment without legislative authority." The printed Instructions issued to him as Governor say nothing on the subject, and I presume he must refer to the generally established rule that except in emergency money must be appropriated by law before paid. As between the Government and the public, it would appear quite clear that, the Legislative Council having adopted the resolution nem. con. & the Governor having in pursuance of that resolution formally proclaimed the terms under which the premium would be payable, the acts of the former Council and former Governor are fully binding upon the present (as also upon the future) Government & Legislatures, & that there is no justification for the plea that circumstances have changed, Manuscript image and still less is it admissible to say that the acts of a former Government do not bind that which succeeds it. The good faith of the Government is, I think, as thoroughly pledged to this probably foolish expenditure as if it had been secured by enactment; & is at least bound to propose a vote or urge the new local government to do so.
I may observe that in Australia a resolution of the Assembly is the sole guarantee upon which bonuses of this kind are frequently secured—& no one dreams of questioning the security.
RGWH June 22/71
Mr Holland
I presume that of course we cannot instruct the Governor to pay or make provision for the payment of the money, but can the Company if their claim is good recover it in a Court of Law? Do you think there is anything in the point that the Colonies having been united this is not the first coal shipped from what is now the Colony?
Mr Herbert
I am inclined to think that the Cy could not recover this money in a Court of Law, but I think they have a very strong equitable claim to the premium, if they can prove to the satisfaction of the Govr in Council that they have performed the conditions. And further it appears to me that as the offers of premiums were not withdrawn upon the UnionManuscript image of V. Island with B. Columbia, the Cy should not be affected by that Union, & they should only be called upon to prove performance of conditions with respect to the Colony of B Columbia as it existed in 1864.
I consider that the good faith of the Govt for the time being of the Colony is pledged to this expenditure; & I should suppose that an intimation of Lord Kimberley's opinion upon this point coupled with an expression of his desire that the matter should be brought under the notice of the Legislature for their favorable consideration would probably ensure the payment.
I apprehend that this will not be a matter for the decision of the Dominion Govt but of the B Columbia, or Provincial, Legislature.
HTH 23/6
I think the Govr should have referred the matter to his Legislative Council—he might be told this & reminded of the importance to a Government of avoiding even the suspicion of repudiating engagements entered into with the sanction & authority of a previous Govt & Legislature.
EHKH 24/6/71
I agree with Mr Herbert and Mr Holland. Write accordingly to Governor. It might be as well to ask Lord Lisgar to let us know when the Dominion Govt actually take over the B. Columbian business.
K June 24/71
(Done by telegraph 26 June Monday.)
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Mr Meade
See Lord Kimberley's minute on 6095.
Qy telegraph as follows to Lord Lisgar. "Report time when the Dominion Govt will actually take over Columbian business."
CC 26 June 71
At once.
RM 26/6
Sent 6:20 P.M. June 26.71.
Recorded No 45426 June 71 L. A/3.
Documents enclosed with the main document (not transcribed)
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Herbert Gaston and J.H. Long, Liquidators, Queen Charlotte Coal Mining Company, to Kimberley, 4 May 1871, outlining particulars of their claim and forwarding related documents and correspondence.
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Extract from the Journals of the Legislative Council of British Columbia, 23 February 1864, dealing with passage of the resolution respecting premiums, certified correct by Charles Good, Clerk, 11 January 1871.
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Newspaper clipping, Government Gazette, 9 July 1864, announcing the government's offer of premiums for successful mining and shipbuilding enterprises in the colony.
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Herbert Gaston, Secretary, Queen Charlotte Coal Mining Company, to P.J. Hankin, Colonial Secretary, 9 April 1870, asking what proofs must be presented by his company in order to claim the premium for coal shipment.
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Hankin to Gaston, 16 April 1870, stating that the government had no responsibility for the payment of the premium, and that there were no funds from which such a grant could be paid.
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Gaston to Hankin, 28 April 1871, expressing surprise that the government would repudiate the solemn promise of a "Legislative Enactment."
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Hankin to Gaston, 3 May 1870, advising that there had never been any legislative enactment or legal provision for the funds.
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Gaston to Hankin, 13 May 1870, further arguing the validity of the company's claim, and asking for assurance that the promise would be honored when the colony was in a better financial condition.
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Hankin to Gaston, 20 May 1870, referring to his previous letters and adding that the governor had no legislative authority for making the payment in question.
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Gaston to Hankin, 6 December 1870, advising that the company was now in voluntary liquidation and needed the £500 to save its mine, and asking that the claim be referred to the next session of the Legislative Council.
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Hankin to Gaston, 23 December 1870, advising that the governor did "not feel at liberty to comply with the request now made."
Other documents included in the file
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Draft reply, Kimberley to Musgrave, No. 64, 28 June 1871.