It is, I think, quite fair that any indemnity which may be
                     due to the H.B.C
o for Land in 
B. Columbia or 
Vancs Island
                     should be paid out of the Revenues of those Colonies
                     respectively—the only difficulty would be as to the time of
                     payment.  The Colonial Revenues 
wd
 I presume be insufficient
                     for several years to pay the indemnity—and the C
o if ousted
                     of their Land would probably object to wait.  If the Treasury
                     would not advance the money as I suppose with New Zealand's
                     experience before their eyes they would refuse to do, the
                     only alternative would be to give the C
o a lien on the Land
                     Revenues of the

 Colonies & pay them interest in the meantime.
                     My belief is that the C
o will not be able to make out a
                     
legal title to the Land in either Colony—but that they
                     will make out a strong case for equitable consideration in
                     
Vancs Isld.  But a case for equitable consideration can be
                     of course settled at the convenience to a certain extent at the
                     discretion of the 
Govt and need not therefore cause

 any embarrassment.
                     
                     I am afraid unless you take some immediate step all the
                     Water frontage in 
Victoria will be sold.  Is it prudent to
                     wait the issue of the proceedings before the Judicial
                     Comm
ee which will probably last some months?