Murdoch to Merivale (Permanent Under-Secretary)
Emigration Office
29 August 1859
Sir,
I have to acknowledge your letter of 15th inst, enclosing Copies of a correspondence with the Hudson's Bay Company and the Governor of British Columbia, on the subject of the claims of the Company to Land in that Colony.  
2. The Hudson's Bay Company, before the discovery of Gold in British Columbia, occupied considerable tracts of Land in the
Country
Country which now forms that Colony, for their Trading Posts and for the support of the Cattle and Horses necessary for carrying on their Trade. To this Land they had no formal title, nor was there any definition of their boundaries. So long as the Country was uninhabited no inconvenience could be thereby created, but when the Gold discoveries attracted large numbers of Settlers it became important that their claims should be ascertained and placed on a more precise and satisfactory footing. The Company accordingly brought
the
the matter under Sir E.B. Lytton's consideration and requested that the Governor might be directed to define their Land, taking a liberal view of their claims with reference to the Land occupied and pastured by their Cattle before the influx of Miners. Sir E.B. Lytton in consequence directed Governor Douglas to enquire into the Company's claims. He added that H.M. Government were desirous of taking a liberal view of those claims, consistently with public interests, but that a considerable distinction must be drawn between Land on which Capital had been expended, and that
which
which had been only temporarily occupied.  
3. Governor Douglas' Despatch of 31st May last contains the Report thus called for. It appears that the Land claimed by the Company amounts in all to upwards of 98,000 Acres, that of this 10 Acres is in the Town of Old Fort Langley, 6,400 Acres or 10 Square Miles in its immediate vicinity, and 640 Acres at the Town of Fort Hope. A Table is annexed to the Despatch from which (if I understand it rightly) it is intended to be inferred, that the whole of the Land has
involved
involved outlay that blocks containing upwards of 80,000 Acres have been brought into partial cultivation and are necessary for the maintenance of existing Stock, and that none has served only for occasional pasture. The Company claim in addition the whole of the cleared land at Old Langley, including what has been sold under protest from their Agent to Settlers and a compensation of 5000 dollars for making Roads and for Land between Fort Hope and Thompsons River not occupied but improved by the sowing of Grass Seed.  
4. Governor Douglas wages strongly the claim of the Hudsons Bay Company to liberal consideration on
the
the ground of their services in securing the Country West of the Rocky Mountains for Great Britain, and the loss they have incurred by the premature revocation of their Trading License. He also lays stress on the alleged recognition of the Company's rights in the Oregon Treaty of 1846. But that Treaty only promises that the "Possessory rights of the Hudsons Bay Co and of all British Subjects who may be already in the occupation of Land or other property lawfully acquired shall be respected." He adds that the Lands claimed by the Company have no connexion with the Gold Fields, are not known to be auriferous are not except the Posts on the Lower part of Frazers River of any extraordinary value for purposes
of
of settlement, and are so remote from the Sea that years will probably elapse before they can be settled. Colonel Moody, whom the Governor consulted, agreed with him on the general principle, but recommended that the claim at Fort Langley & Fort Hope should be admitted to a limited extent only & compensation be provided by the Grant of Land elsewhere. At Fort Hope he observed, the claim, if rigidly followed out, would embrace Town Lots in respect of which the Crown is already pledged to others.  
5. The nature & extent of the political claims of the Hudson's
Bay
Bay Company on the Crown can be best appreciated by the Secretary of State. We have no means at this Office (even if it were within our province to do so) of forming an opinion upon them. But there can be no disposition on the part of H.M. Government to deal with the Company in an illiberal Spirit. The real question is how far their claims can be admitted without injustice to other residents in the Colony, and without the risk of obstructing its future settlement.  
6. Upon this point it is extremely difficult to form any conclusion from Governor
Douglas'
Douglas
' Despatch. Sir E.B. Lytton had indicated the principle which should guide the decision, by stating that he was prepared to draw a considerable distinction between land which had been cultivated or had involved outlay or was necessary for existing Stock, and that which had served only for occasional pasturage. But Governor Douglas has placed the whole of the Company's claim in the former category, although it is very difficult to believe that 98,000 Acres spread in blocks varying from a few Acres to 100 Square Miles over several
hundred
hundred Miles of Country should all be properly entitled to be so considered. The explanation may possibly be, that a great portion of the Land has Cattle upon it belonging to the Company, and may, therefore, be considered as falling within the description of being necessary "to the maintenance of their existing Stock or Establishment." The result, however, is that some more specific principle must be adopted for determining the extent to which the claims of the Company should be recognized by H.M. Government.  
Colonel
7. Colonel Moody has observed, with reference to their claims at Fort Langley and Fort Hope, that their admission to the full extent would provoke very hostile criticism and protests on the part of the public, and might eventually lead to the Company obtaining less than justice. Considering that the claim at Fort Langley, as has been stated, is, in its full extent, for the whole of the Town, and even in its reduced form, for 10 acres or 60 lots in the Town, and for 6,400 Acres in its immediate vicinity and that such lots were sold
last
last year at upwards of £42 a Lot, it is impossible to question the correctness of this opinion. To recognize this claim, even in its less extended form, would place the future progress of Fort Langley in the hands of the Hudsons Bay Company, and the same result would follow if the claim of the Company to 640 Acres at Fort Hope were admitted. Indeed as the Posts of the Company were naturally placed at the most convenient spots for communication between the interior and the Fort, and as such
spots
spots would, in the ordinary course of events, become the most probable centres of population, the grant to the Company of the Land claimed as having been occupied by them would make them to a great extent Masters of the future progress of the Colony, that it would provoke discontent and complaint among the immigrant population can hardly admit of doubt.  
8. But while it seems quite clear that the claims of the Company must be very much reduced from their present
amount
amount before they can be entertained, it is almost impossible to determine, except on the spot, what ought to be rejected. As a general rule I would submit, that claims to Land in Towns or in spots likely to become the sites of Towns should be admitted with great reserve, and only on proof of a substantial expenditure of capital upon them, either in the preparation of the Land or in the actual erection *
*
Is mere clearing to be considered as just outlay?  
of buildings, that tracts of Country Land, not auriferous,
which
which have been actually brought under cultivation should be granted to the Company with such a reasonable extension of area as may be necessary to turn the Land to good account, but in respect to the large tracts occupied by the Companys Stock, that they should receive only a License of occupation at a small yearly rent, subject, however, to be terminated at the end of each year if the Land should be required for Sale or Settlement. If these principles should be approved the application of them must
still
still be left to the Governor on the spot, but with the means of information at his command he could have no great difficulty in carrying them into effect. It may, however, save time if when the principles to be observed have been decided on a communication were made to the Company in this Country before final instructions are sent to Governor Douglas.  
Under any circumstances Governor Douglas should, I think, be instructed to furnish hereafter a full report of the steps which he may take in the matter with
an
an explanation of the nature of the claim of the Company to the several tracts of Land which he may propose to concede to them, and that his report should be accompanied, if possible, by a Chart showing the position of the Land claimed and of that conceded.  
I have etc.
T.W.C. Murdoch
Minutes by CO staff
Mr Merivale
So far as regards tracts of Country land which may have been either cultivated or used for pasture by the Company, the principles laid down in par 8 of this report would seem to be equitable. But may it not be a question whether proof of the expenditure of capital in the cultivation of land should be allowed to establish the claim of the company to such land, in the case of sites of towns. For instance, if the land that has been occupied by the Company at Langley and Fort Hope has been brought into cultivation by them, shd they be allowed to retain it now that it has been converted into Town Lots? I should think it might lead to serious results to admit that such expenditure of Capital confers on the Company a title to the Lands on which the towns are being built, and that it might be more advisable to grant the Company compensation for improvements & an equivalent in land elsewhere in the Colony?  
When the principles to be observed are decided on—write to the Company as suggested by the Commrs in par 9, before instructing Gov Douglas.  
HT Irving
31 Augt
Other documents included in the file
  • Draft, Merivale to H. Berens, Hudson's Bay Company, 14 September 1859, forwarding copy of a despatch from Douglas concerning the claims of the company to land in British Columbia, and further discussing the subject.  
Minutes by CO staff
Duke of Newcastle
This seems to me to raise some questions of great difficulty; but a decision must apparently be arrived at without delay.  
The H.B.C. never had or asked for any title from the Crown to the parcels of land which they have occupied in the N.W. territories. What semblance of title they may have derived from Indians, does not appear. Legally speaking I take it they are mere squatters.  
But doubtless squatters under such peculiar circumstances do acquire equitable claims which it is difficult to disregard.  
And I think they have ingeniously drawn an additional argument from the Oregon Treaty of 1846, which it is not very easy to meet. That treaty secured to them their "possessory rights" south of 49o. The meaning of the words per se is not very clear; but, they allege, with truth I believe that we have contended against the Amn Government in their behalf that these words secure their rights as landlords: and, they say, it would be very inconsistent to contend that they are landlords south of 49o and not landlords north of 49o under precisely similar circumstances.  
But the misfortune is this: the spots of land claimed by the Co. lie round their old Forts: and these Forts occupied (naturally) precisely those points on the navigable rivers & at the meeting of valleys where settlements would first be established & which therefore acquire value as "town lots." They claim the site of Langley, of Fort Hope, & of many more places which will certainly, however slowly, become seats of population & industry. Their claims therefore, in the first place, involve considerable gains to themselves at the expense of the public, from the increased value of land for which they gave nothing: in the next place, stand in the way of public disposal of the land & check improvement.  
Col. Moody suggests measures which might palliate to some extent the evil as to Langley & Yale: but they lie rather in negociation than in principle: & the same evil will certainly recur as to other points claimed, unless measures are taken beforehand.  
It seems to me that a large portion of these claims rest solely on the fact that the Company have cleared the land: which they call an "expenditure of capital." I hardly think this is such an expenditure as Ld Carnarvon contemplated. It should be, as the Commissioners term it, "substantial."  
But the main question is, whether under all the circumstances we are or are not entitled to take a bolder tone, & to say that we will compensate the Co. for actual outlay if they choose, offer them fair terms of exhange if they choose, but that we will not consent to any arrangement which shall leave them in possession of town lots except such as are actually occupied by their buildings & cultivated land.  
An opinion from the Law Advisers might be serviceable on this point—but I almost fear recommending it.  
Lastly, the limits must ultimately be settled in the Colony itself: & who is to act for Government? We cannot trust the Governor. But I think we may trust Col. Moody.  
HM
S 2
I have marked the points where the lands are situate in the map contained in the annexed Blue book.  
[HM]
Writing from recollection only of the Oregon Treaty, I think the reservation of the interests of the Hudson's Bay Company went no further than this—that whatever rights they possessed in the Country as British Subjects should not be forfeited in respect of that portion of the Country held under Charter or License which was by the Treaty ceded to the United States. They can hardly plead as against Gt Britain any diplomatic efforts which have been made to protect them against repudiation of their claims by the U.S., but if they do we might with as much justice and consistency plead the refusal hitherto to recognize those claims.  
Whatever may be the case under the Charter I cannot conceive how the Company can claim any rights as Landlords under the License unless they can shew, beyond the powers of the License, either a grant by the Crown or a purchase by themselves of the lands in question. To compensation for any expenditure—either in erecting buildings or bringing land into cultivation they are entitled, though even then with abatement for the time during which they have derived profit from such expenditure without the payment of any acknowledgement to the Crown. The peculiar circumstances and position of the Company entitle them to a liberal construction of their claims but not to a recognition of rights which primâ facie do not exist.  
If they could shew a title, or even an equitable claim, to these lands I should deplore the public mischief which Mr Merivale points out in respect to the Town Lots and sites of Forts but I should see no remedy without violation of private property short of buying out the Company at the present enhanced value, but title they clearly cannot produce and equitable claim has not so far as I know been yet advanced.  
A fair compromise is the only way of settling such a case. The Town Lots & Forts (except the actual sites of existing buildings) cannot be conceded to the Company. If, as seems improbable, they can prove expenditure of Capital in substantial improvements of the large tracts they claim they may either be allowed to retain them with a title now conferred or receive fair compensation for their surrender. The principle of exchange might also enter into the arrangement if desired. License of occupation, as proposed by the Commrs in par: 8 might possibly (though I am inclined to doubt it) be found in some cases an equitable arrangement.  
It is obvious that the anomalous position of Govr Douglas precludes his being employed in this matter, & I do not doubt he would deprecate undertaking such a duty. Coll Moody is an obvious and fit person to employ on behalf of the Public, but before sending any instructions it will be necessary to ascertain from the Company how far they will accede to these principles of settlement and whether they will instruct any Person to act on their behalf.  
N
3
 
Public Offices document:
Murdoch to Merivale (Permanent Under-Secretary), 29 August 1859, National Archives of the UK, 8634, CO 60/5. The Colonial Despatches of Vancouver Island and British Columbia 1846-1871. Ed. James Hendrickson and the Colonial Despatches project. Victoria: University of Victoria. http://bcgenesis.uvic.ca/getDoc.htm?id=B595LN11.scx. Accessed 11 December 2018. 

Last modified: 11:47:02, 4/12/2018