Arbuthnot to Rogers (Permanent Under-Secretary)
Treasury Chambers
28 May 1860
I am directed by the Lords Commissoners of Her Majesty's Treasury to transmit to you a Report from Messrs Foster and Lewes—who have been appointed to examine the Accounts of the Hudson's Bay Company—and I am to request that you will lay the same before the Duke of Newcastle and move His Grace to inform My Lords whether in his opinion the sum of £25,000 may now be safely advanced to the Hudson's Bay Company "on account" of their claims in respect of Vancouver Island. Their Lordships wish to be informed whether the representation made toManuscript imageto the Writers of this Report to the effect that the proceeds of the Land Sales during the 7 Months ending May 1859 have been paid by order of Governor Douglas to the Government chest in lieu of being remitted home by the Agent of the Company is correct.
I am etc.
G. Arbuthnot
Minutes by CO staff
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Mr Elliot
The Officers, appointed at the instance of the Treasury to make the preliminary examination of the H.B.Co accounts, now report that if there be proof in this Office or elsewhere that the proceeds of the land sales in V.C.I. during the 7 months ending 31 May/59 have been paid into the Colonial Chest instead of being remitted to the H.B.Co, and if it be determined to prefer no claim to deduction from the charge made by the Co for the conveyance of Emigrants to the Colony then Manuscript image£25,000 may be paid on acct. But if otherwise that then £20,000 only should be paid.
Now with respect to the first hypothesis the only despatch bearing on the point in our possession down to yesterday is that of 24 Novr 59/871 which mentions that the Govr had been "forced to apply the monies arising from the sale of public Lands" to the current expenses of the Colony. The extent of such appropriation is not therein stated. But yesterday we recd a despatch from Govr D. dated 7 Apl 60/5375—which I pass on herewith—containing an abstract of the H.B.Co Account with H.M. Gt for disbursements in & for V.C. Isld since it's first establishment in /49 to the 10 Novr/59. These accounts will have to undergo a careful sifting before we can venture on accepting them as "true & correct". They may, however, serve us on the present occasion. For in referring to the acct No 1 you will notice that whilst in /58 the proceeds from the sales Manuscript imageof land amounted to £7890, the proceeds reported in No 2. for 1859 were only £425. Now as we know that a good deal of Land has been sold of late I think it is to be assumed that Govr Douglas has taken the proceeds for Governmental purposes. This is, however, no more than an assumption; and we shd prefer something more definite & to the purpose when paying away money to the Hudson's B. Co. At any rate, I think, that, though it may cause additional delay, we ought not to move in the matter without communicating to the T-y the accounts just recd & asking them whether they consider the infn they contain sufficient to justify the payment of this £25,000.
The second hypothesis of the reporters is as to making any deduction from the sum to be paid to the Co for emigration expenses. I presume that this point must be decided by the terms of the Grant of V.C.I. to the Co. Those terms are payment of sum or sums of money theretofore laid out & expended by them (the Co) in & upon the said Isld & premises & of the value of their establishments, property & effects then being thereon, and they do not seem, to me at least, to be expansive enough to justify an attempt at any deduction being made on acct of the increased value of the Co's farms arising from Immigration effected at the cost of the Empire.
ABd 30/5
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Mr Fortescue
I see no reason for delay on this subject nor for a reference back to the Treasury. They have asked for our opinion and I think that we have sufficient materials to give it.
In the first place the idea started by one of our examiners that instead of repaying to the Company the fair sum total of their expenses on Emigration, we should make a deduction on the plea that the introduction of Emigrants must have done good to their property, appears to me utterly inadmissable. I should dismiss at once a notion which appears to me sophistical and inconsistent with fair dealing.
In the next place the newly arrivedManuscript imagearrived despatch to which Mr Blackwood refers, although it does not exhibit any clear view of the land account for 1859 separately, does nevertheless show that on the whole account of that single year, the Company has a claim of upwards of £17000 to prefer against the Government.
For these reasons I strongly advise that we should at once reply to the Treasury that in the opinion of this Department, the sum of £25,000 may be safely advanced to the Hudson's Bay Company.
See Governor's despatch, 5375, annexed.
TFE 1 June
There can be no doubt, I think, about this.
CF 1
The sum of £25,000 on account may now be paid.
N 3
Other documents included in the file
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Draft, Elliot to G.A. Hamilton, Treasury, 13 June 1860, asking that directions be given for payment of the £25,000, and explaining Newcastle's reasons for believing that this sum could be safely advanced.
Minutes by CO staff
Mr Blackwood
I suppose it will be safer to defer sending Mr Murdoch's Despatch to the Governor till the money is actually paid?
HT Irving 5 June
(N.B. The Draft of that Despatch will require to be revised in consequence of the Hud. Bay Co's letter 4873.)
Documents enclosed with the main document (not transcribed)
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M. H. Foster and John S. Lewes to Secretary of the Treasury, 24 May 1860, reporting on their examination of the Hudson's Bay Company's accounts (five pages).
Arbuthnot, George to Rogers, Frederic 28 May 1860, CO 305:15, no. 5357, 550. The Colonial Despatches of Vancouver Island and British Columbia 1846-1871, Edition 2.2, ed. James Hendrickson and the Colonial Despatches project. Victoria, B.C.: University of Victoria. https://bcgenesis.uvic.ca/V605TE04.html.

Last modified: 2020-12-02 13:40:34 -0800 (Wed, 02 Dec 2020) (SVN revision: 5008)