Colonial Despatches

I have the honor to acknowledge the receipt of Mr Merivale's letter of the 23rd ulto., in which he informed me that your Grace has proposed to the Lords Commissoners of the Treasury that a vote should be taken this year for £25,000, in order to [that] the application of a sum, not exceeding that amount, to the payment on account of the sums due by Her Majesty's Government to this Company on the surrender of Vancouver's Island, leaving for adjustment, whenever complete accountsaccounts shall be sent in, the further claims of the Crown, or of the Company, on account of the local revenue on the one side, and the expenditure on public works and establishments on the other, down to the close of the Grant.

When I ventured to suggest, in my letter to your Grace of the 23rd January last, that if Her Majesty's Government were not at present prepared to call for a reconveyance of the Island, this Company would be willing to concur in an arrangement by which the Governor should be empowered to dispose of land, to receive the proceeds of it, and to account for the money to the Crown, I certainly expected that Her Majesty's Government, if it adopted the suggestion, wouldwould at the same time have agreed to the condition which was annexed, namely, that the whole of the advances already clearly ascertained, and long since communicated to the Government, should be satisfied. I was the more confident that this proposition would have been agreed to in its integrity, because I am not aware that more complete accounts can be furnished than those which have already been transmitted to the Government, and which have since been examined by Mr Lewis, the Accountant of the Emigration Board, who attended at this Office for the purpose. If any further information on the subject should be considered necessarynecessary, it would be convenient that I should be made acquainted with the nature of it.

Although, however, the terms upon which I proposed that the power of conveying land should be conferred upon the Governor of Vancouver's Island have not been fully agreed to by your Grace, I am not disposed, on the part of this Company, to reject your Grace's proposition of receiving £25,000 on account of those advances, and I am therefore prepared to receive that amount to account, and to grant the authority to the Governor to make grants of land, on the express understanding that the authority to dispose of land will not embrace any of the lands belonging to, oror which have been registered as belonging to, this Company, whether they now hold them in their own possession or have disposed of them to third parties.

Towards the end of his letter Mr Merivale states that your Grace is not aware of any objection to the principle of the Company receiving such an undertaking as is specified in my letter of January 23rd, but that you are not certain as to what "advances, made or to be made", the passage is intended to refer. In reply I have merely to state that the "advances" referred to, have only been such as were considered necessary for the purpose ot the Government of the Colony, and that soso far as is known to us, they were never made excepting on the pressing demands of the Governor, who in some instances made use of funds belonging to this Company which happened to be under his control without previously consulting the Company or obtaining their approval of the purposes for which he used them.

I had hoped that this Company would have been put in funds to meet, a portion at least of, these additional advances from the receipts for land disposed of by them prior to the determination of the Grant to them of the Island, but I regret to find by a communication recently received from thethe Colony, that Governor Douglas has taken possession of those further payments and applied them for the purposes of the Government, so that the sum expected to come to the credit of the Government from that account will be greatly diminished.

Before closing this letter I beg to remind your Grace that the amount claimed by this Company, for which the detailed accounts were rendered on the 23rd ulto. is £40,289.19.9, of which your Grace proposes to pay £25,000 to account. These advances extend over a series of years, and I would beg leave to submit, that on the balance which will remain after payment of the £25,000, as the delay is in order to meet the public convenienceconvenience, this Company is entitled to charge interest at the usual rate, dating from the period at which the accounts were rendered.

I have the honor to offer my own thanks, and those of my Colleagues, for the communication of the Copy of Governor Douglas's despatch to your Grace, dated December 17th 1859, and of the answer which your Grace proposes to make to that communication.