No. 13
22th May 1856
1. I have the honor to acknowledge the receipt of your Despatch No 6 of the 28th of February last, calling my attention to the present state of affairs between Her Majesty's Government, and the Hudson's Bay Company, with reference to the probable re-purchase, by the Crown, of the land of Vancouver's Island, on payment to the Company, of the sums heretoforeManuscript imageheretofore laid out and expended by the Company, in and upon the said "Island and Premises," and the value of their Establishments, property and effects. You also therein direct that I should furnish a specification of the present state of the account, that is to say, of the sums hitherto expended by the Hudson's Bay Company, in the manner described in the grant, and also of the sums realized by the Company, by the sale of land and applied from time to time towards the colonization and improvement of the Island.
2. I have the honor to inform you in reply to the subject of that Despatch that it will be a matter of little difficulty, to furnish a statement of all the monies expended within the Colony, for public improvements, and other colonial purposes, and I can also furnish an exact statement of the sums realized by the Hudsons Bay Company, through the sale of land, asManuscript imageas the Colonial accounts, which have been very carefully kept, account for every penny of the public money that has been received and disbursed by the Executive Government.
3. It is however out of my power to furnish a statement of the sums which have been disbursed in England by the Hudson's Bay Company, on account of objects, connected with the Colony of Vancouver's Island, as I am only partially acquainted with, and have no record of the full amount of that expenditure.
4. I observe that the Grant, includes among the items to be repurchased the "Establishments property and effects" of the Hudson's Bay Company on Vancouver's Island.
"Their" establishmts.
5. If that clause has application only to military establishments, and to outlays made for the protection and defense of the Colony, the same appear, and are included in the Colonial accounts, but if it refers to the commercial andManuscript imageand farming establishments of the Hudson's Bay Company, formed prior to and since the grant of Vancouver's Island, by the Crown, I have not the means of furnishing an account of the expenditure thereby incurred, which cannot be correctly ascertained without an application to the Governor of the Hudson's Bay Company.
6. I will in the mean time prepare and forward as soon as possible, a statement of all money, the proceeds of land sales and otherwise derived, received and expended under the sanction of the Executive Government within this Colony, which is all that I have information sufficient to accomplish. In attempting to do more I might mislead HerManuscript imageHer Majesty's Government by erroneous statements.
I have the honor to be Sir
Your most obedient humble Servant
James Douglas

The Right Honble Henry Labouchere Esqre
Her Majesty's principal Secretary of State
For the Colonial Department.
Minutes by CO staff
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ABd 13 Augt/56
Mr Labouchere
Mr Douglas raises a question of some little nicety in the paragraph which I have marginally noted in red ink. I have however little doubt that the intention was to repay the HBC. the value of their private property on the island. IfManuscript image public establishments had been meant, it would have been so expressed. Though the point seems clear to me, perhaps you would prefer an opinion on the point from the Law Advisers?
Supposing the meaning to be as I suggest: it seems to me to remain a question, whether the H.B.C. may not prefer to keep their "establishments" instead of being paid for them: and whether it would not be best for the colony that they should do so, although they will have lost their power over the waste land. I do not see what is to become of these "establishments" if the Company part with them.
HM Augt 13
Is it necessary for us to raise this question at present? What we
want is a regular statement of the expenses of the Company which we may ultimately be called upon to repay. They shd be asked to give those accounts that the Governor cannot furnish.
HL A 14
Other documents included in the file
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Draft, Colonial Office to John Shepherd, Hudson's Bay Company, 30 August 1856, asking for a statement of what the company had spent in England on account of the colony.