No. 63
               
            
            
               8th October 1866
               
               My Lord,
                
            
            
               I have the honor to acknowledge the receipt of Your
               despatch No. 3 of the 
30th July, forwarding a letter from
               the Governor of the Hudson Bay Company, together with an extract
of a
               of a letter from 
Mr R. Finlayson representing that the Hudson
               Bay Company are subjected to the payment of Customs Duties on
               importations into this Colony which are not exacted with equal
               strictness from other traders.
               
               2.  In reply to this Statement I have the honor to enclose
               a copy of a Report from the Collector of Customs.
               
            
            
               3.  It is difficult to furnish any explanation of such a
strange
               strange misstatement of facts, as that contained in the extract
               from 
Mr Finlayson's letter which accompanies Your despatch.
               
               
               
                  
                     
                     The Company's Agents maintain that their Statements are substantially
                     correct.  See 12157 Page 11 of enclosure.
                     
                  
                
               
               
               4.  
Mr Finlayson states that repeated representations have
               been made to me on the subject, and even informs the Hudson Bay
               Company, through their Secretary, of the reply I have given to
               these representations.
               
               5.  If the first portion of 
Mr Finlayson's statement is
               correct, the postal service between
Vancouver Vancouver Island
 Vancouver Island and this
               Colony must be very defective.  During the fourteen months I
               have administered the Government of this Colony I have never
               received a representation from the Employees of the Hudson Bay
               Company on this subject, it is needless to add that I have never
               had occasion to reply in the terms stated in 
Mr Finlayson's letter.
               
               6.  
Mr Finlayson cannot
but
 but be aware of the very stringent
               Laws lately passed by the Legislature of this Colony with a view
               to suppress the sale of intoxicating liquor to the native tribes,
               and of the desire of this Government to do everything in its power
               to destroy a trade which is so demoralizing to all engaged in it.
               
               7.  The Ordinances noted in the Margin
               
               
               
                  
                     
                     No.  2 1865—Native Evidence.
                     
                     No. 16 1865—Prohibiting sale or gift of liquor to Indians.
                     
                
               
               have
worked
 worked most successfully throughout the interior of this Colony and
               it is only on the Coast that the sale of liquor to Indians continues to
               any extent—and even there I am led to believe from the reports
               received from the Customs Agent that the consumption of Spirits
               is much reduced.
               
               8.  In 
October 1865, 
Mr Duncan, of the 
Methlakatla Mission
               informed me
that
 that two Vessels were employed in selling liquor to
               Indians on the Coast of this Colony.  I immediately applied to
               
Admiral Denman for a Ship of War.  A vessel was placed at my
               disposal without hesitation, and within six weeks both vessels
               had been captured.  I have received no representation from any
               source since that date.
               
               9.  There can be no doubt
that
 that a large quantity of liquor
               is taken from 
Victoria in canoes up the Coasts of 
Vancouver Island and 
British Columbia.  A glance at the map of the Coast
               line, will show the almost impossibility of preventing this
               while the laws of 
Vancouver Island allow with impunity the sale
               and exportation, in any kind of craft, of any quantity of spirits
               & alcohol.
               
               
               
                  
                     
                     It is stated by the Company's Agent in 
V.C.I. that most of the Small
                     Trading Vessels are fitted out at 
Victoria.  See enclosure in 12157
                     Page 11.
                     
 
               
               
               10.  Had the Laws of these
Colonies
 Colonies on the questions connected
               with the Native Races been assimilated, the Indian liquor trade
               would long ere this have been destroyed.
               
               11.  It is somewhat remarkable that the representatives of
               the Hudson Bay Company in 
Vancouver Island strongly opposed the
               Bill brought in by the Government of that Colony, on the model of
               the one now in force in 
British Columbia, and 
Mr Finlaysonas
 as
               a Member of the Legislative Council, went so far as to propose
               the introduction of a Bill, legalizing the sale of liquor to Indians.
               
               12.  While the Laws of 
Vancouver Island have encouraged this
               vile traffic, and a large number of the "Merchants" have lived
               on the proceeds of this lucrative trade, it has been very difficult
               to carry out on the sea-coast the laws existing in 
BritishColumbia Columbia
 Columbia
               for the prevention of the sale of intoxicating liquor to Indians;
               more especially since the receipt of 
Mr Secretary Cardwell's
               despatch No. 50 of 
July 1865, informing me that the Law Officers
               of the Crown were of opinion that all the Islands, adjacent to
               the West Coast of North America, south of the 52
nd degree of
               North Latitude, belong to the Colony of 
Vancouver Island.  After
               this decision
was
 was received the Customs Officer stationed on the
               Northern Coast, could no longer overhaul canoes and small vessels
               coasting along the 
Vancouver Island shores, and thus a large
               amount of liquor has been sold with impunity, and some has
               doubtless found its way in small quantities to the Indian Tribes
               on the mainland.  It is difficult to make the Indians understand
               the justice of allowing the tribes on 
Vancouver Islandto
 to hold
               their drunken orgies without interference, while the Indians resident
               on the mainland are punished if liquor is found in their Camps.
               
               13.  I have on several occasions in interviews with 
Dr Tolmie
               and 
Captain Lewis proposed a somewhat unusual course, but one
               which I considered the present anomalous state of affairs justified,
               namely, that the Captain and Officers of the Hudson Bay Company's
Steamer
               Steamer engaged in the North West Coast Trade, should be allowed
               to receive, from the Government, an authority to act in the
               prevention of smuggling and the sale of intoxicating liquor to
               Indians, but the reply has invariably been that such an authority
               might interfere with the Company's trade.  Had the representatives
               of the Company in these Colonies acceded to this suggestion, the
               North West trade would have been virtually secured to the
Hudson
 Hudson
               Bay Company, and the illegal traffic referred to, destroyed.
               Indians will freely give information to trading vessels as to
               the sale and amount of liquor in their possession, while, during
               the presence of one of Her Majesty's Ships on the Coast they are
               generally invisible, having a great dread of a Man of War.
               
               14.  With the immediate Union of these Colonies in view, and
               the consequent extension of the
British British Columbia
 British Columbian Ordinances to
               the 
Island of Vancouver, I apprehend no difficulty in dealing
               with this important question.
               
               
               
                  
                     
                     Will this take place as a matter of course—and
                     pro facto?
                     
                  
                
               
               
               15.  If the Hudson Bay Company find their Fur trade on the
               North West Coast on the decline the cause may be traced, not
               to the action of the Government, but rather to the conduct of
               their own servants, who have invariably opposed the Government
               of 
Vancouver Island in passing proper and humane laws for the
protection
               protection of the native tribes, and are unwilling to render
               the Government of this Colony, the slightest assistance in
               carrying out laws for the suppression of an illegal and demoralizing
               traffic, which by their own action they have assisted to create.
               
               I have the honor to be,
               My Lord,
               Your most obedient
               humble Servant
               
Arthur N. Birch
               
               
               Minutes by CO staff
               
                
                  
                  
                     Mr Elliot
                     See 12157 from the Company received today.  It appears
                     that 
Mr Birch called upon the Agent of the H.B. Company for
                     an explanation of the Statement sent here in 
July last
                     (6900).  The Agent replied on the 
13 of Oct (see 12157
                     Page 10 to 33 of enclosure) but this Desp was written
                     before the receipt of the reply.  We shall no doubt receive
                     a further report.  If this despatch is sent to the Company
                     they can only refer us to their Agent's letters to the 
Govr
                     copies of which they now furnish.
                     
 
                  
                  
                  
                  
                  
                     I think we may dismiss in silence any impatience
                     of what is termed the "complaint" of the Hudsons'

 Bay
                     Company.  The letters of their Servants in 12157 (herewith)
                     do not appear to me otherwise than temperate and to the
                     purpose.  If they saw an injurious illicit trade in liquor,
                     they are right to denounce it to the Governor.
                     
                     As to their declining to undertake the office of
                     detecting, seizing and punishing illicit traders—in fact
                     of Custom House Officers—it must be remembered that they
                     are no longer Rulers or a political body but only Commercial—and
                     I do not think there is good reason to complain of
                     Traders declining to accept the questionable business of
                     judging and punishing their rival Traders.  Even the collateral
                     advantages to which this despatch alludes of the
                     Indians' giving

 information to them more readily than to a
                     Man of War, would cease the moment that they were known to have
                     received the power and duties of a Man of War.
                     
                     Dismissing then anything controversial, and turning to
                     substance, the important point seems to be that 
Mr Birch
                     tells us that there are efficient Laws against the illicit
                     trade in 
B. Columbia, but not in 
Vancouver.  This should be
                     verified, & if the 
B. Columbia ordinances (which should be
                     referred to) appear good, the next step should be to
                     ascertain whether (as is indicated on page 15) they become
                     by the Union extended to 
Vancouver, and if not, to draw the
                     Governor's attention to the expediency of that measure unless there
                     be local objection not within the knowledge of the 
Secy of State.
                     
                     (At page 7 will be seen an account of a vigorous
                     punishment of two illicit trading Vessels.)
                     
                  
                  
                   
               
               
                  
                  
                     Should we send a Copy of this, or of Enclr to H. Bay Company,
                     to whom it might give offence that is unnecessary; but I should
                     tell them in due time what is done on the substances of the question.
                     
                  
                  
                   
               
                
                  
                  
                     The question raised by 
Mr Elliot s
d be looked into.
                     
                     As regards the imposing of 
B. Columbian Laws upon 
V.C.I.
                     care is necessary.  There is g
t jealousy obviously
                     existing in the two Colonies of each other—and the operation
                     of a law 
wh is satisfactory to the 
B.C. community may turn
                     out very distasteful to the Colony of 
V.C.I.
                     
                     This is merely a caution.
                     
                  
                  
                  
                  
                  
                     I am sufficiently acquainted with what has passed on this
                     subject to be able to say that the 
B.C. Ordinances for the
                     suppression of spirit selling to the Indians, aided of course
                     by the occasional help of Gun boats &c &c have worked fairly
                     well; & that whenever mischief has ensued on the Coasts of
                     
B.C. it has been the consequence of 
V.C.I. and

 or other trading
                     vessels smuggling the liquor up the Rivers & arms of
                     the Sea where the 
B.C. Officials, without boats, could not
                     follow.  What 
Mr Birch says of the opposition of the Legislature
                     of 
V.C.I. is quite true.  That Body not only refused to pass
                     Laws to put down the Liquor selling to the Indians but even
                     proposed to legalize it and the Agents of the H.B.C
o took an
                     active part against the 
Govt.
                     
                     As to the extension to 
V.C.I. of the 
B.C. Ord
ces that can only be accomplished by an express Law passed for the purpose.
                     By the 5
th Sect. of the Union Act the Laws of the separate
                     Colonies are declared to continue except as to Revenue of
                     Customs.  Wherefore 
Govr shd submit to his Legislative
                     Council a draft of a Law for the suppression of this traffic.
                     He will probably resort to the 
B.C. Ord
ces for a model.
                     I quite agree in 
Lord Carnarvon's obser
n as to the caution
                     which 
shd be generally used in imposing 
B.C. Laws on 
V.C.I.
                     but in this case I think we need have little delicacy in the

                     matter the 
V.C.I. people having obstinately opposed the passing
                     of humane and necessary Laws, and attempted to legalize a
                     traffic fraught with so much evil.  Fortunately one of 
Mr
                        Seymour's qualifications is that of tact, & I 
shd not be
                     at all apprehensive of his pressing too hardly upon the
                     inhabitants of 
V.C.I. who are not, perhaps, just now in very
                     good humor.  I 
shd rather fear he 
wd not be coercive
                     enough, & for my own part, I 
shd be disposed, in earnestly
                     directing his attention to this subject, & to the expediency
                     of having a vigorous Law passed to arrest an evil of great
                     & admitted magnitude, remind him of the frequently expressed
                     wishes of H.M.G. to have measures passed which shall tend
                     to the protection & amelioration of the condition of the Queen's
                     Indian Subjects.
                     
 
               
                
                  
                  
                     Since writing this minute a despatch of 
Lord Carnarvons—d.
                     
16 Nov 66—has been brought to me which tell[s] 
Govr Seymour
                     that one of his earliest duties is that of considering what
                     measures 
shd be adopted to check so grave an evil as
                     liquor selling to the Indians.  This 
desph was written whilst
                     I was on leave.
                     
                     The Desph from the Governor 10225 bears out all I have said.
                     
                  
                  
                   
            
            
               Documents enclosed with the main document (not transcribed)
               
                
                  
                  
                     W. Hamley, Collector of Customs, 
28 September 1866, reporting on
                     trade in the colony with reference to the Hudson's Bay Company's charge.
                     
                     
 
                   
            
            
               Other documents included in the file
               
               
                  
                  
                  
                     Minutes by CO staff
                     
                      
                        
                        
                           On looking carefully again through this despatch and
                           the minutes, it has struck me that it may be thought fit to
                           send out some such despatch as the present to 
Governor
                              Seymour.  I circulate with it the draft of a letter to be
                           sent in that case to the Hudson's Bay Company.
                           
                        
                        
                           [Transmit as?] a very good draft.
                           
                        
                        
                        
                         
                      
                   
               
               
                
            
            
            
               
                  People in this document
                  
                        Adderley, C. B.
                  Birch,  Arthur Nonus
                  
                        Blackwood, Arthur Johnstone
                  
                        Cardwell, Edward
                  
                        Carnarvon, Earl
                  
                        Denman, Rear Admiral Joseph
                  
                        Duncan,  William
                  
                        Elliot, Thomas Frederick
                  
                        Finlayson, Roderick
                        
                  
                        Hamley, Wymond Ogilvy
                  Jadis, Vane
                  
                        Lewis, Captain H. G.
                  Seymour, Governor Frederick
                  
                        Tolmie,  William Fraser
                        
                
               
                  Places in this document
                  British Columbia
                  Metlakatla
                  Vancouver Island
                  Victoria