I beg to acknowledge the receipt of 
               
                  Copy to Gov Hudson's Bay Compy for r 3 Sept/51 for consid
                your Lordships despatch No 3,
               of 
29 June 1850 transmitting the public seal of the colony of 
Vancouvers Island, and Her Majesty's warrant and sign manual authorizing and
               directing its use.
I have also to acknowledge the receipt of your Lordships despatch
               No 4 of 
16 July 1850 approving of my reasons for deferring the
               nomination of a council for the present and pointing out the expediency
               of establishing the council and other prescribed institutions without
               any 
unnecessary
unnecessary delay —
I can assure your Lordship that I am deeply impressed with a sense
               of the expediency of the prescribed measures, but I regret to add that
               there is at present a total want of the necessary materials either for a
               
               council or for any other legislative, or executive appointments, The
               whole tendency of the system pursued by the Hudson's bay Company being
               to exclude free settlers, and reserve 
the Island either as an enlarged post of their own, or a desert.
I have received a communication from the Hudsons bay Company
               stating that no salaries are to be paid out of the proceeds of the land
               sales, but must be raised in 
the Island either by taxes on imports, or otherwise. This is in fact repudiating the clause
               in their grant which
               binds them to provide, at their own expense, all necessary civil and
               military establishments,

 their own arrangements tend to prevent a tax paying population settling here, and
               that the harbours shall be open to
               all nations for the purposes of trade is prominently put forward in the
               prospectus they have published.
               Reports are current of gold having been found by the Cowitchin
               Indians, in the 
Arro Canal, but they are so vague as scarcely to
               deserve notice,
 
            
            
            
            
            
            
            
            
            
               Minutes by CO staff
 
               
               
                  
                  
                     Mr Merivale
                     The 
Charter Grant provides that the Company shall defray the entire expense of any Civil and
                     Military Establishments, but it neither authorizes nor
                     forbids the imposition of taxes.
 
                  
                  
                  
                   
               
               
               
                  
                  It also devotes all the fund arising from land sales (except 10 per
                     cent) to the "colonization & improvement of the island." It is not very
                     clear whether these words would include the expenses of civil government
                     or not. In the present instance however the Governor, by not annexing
                     the "communication" he has received from the Company, has made it
                     impossible to take any definite steps: we do not know what salaries are
                     in question. Probably this desp. had better be referred to the Company
                     for explanation?
                  
                  
                  
                   
                
            
            
            
            
            
               Other documents included in the file
 
               
               
                  
                  Draft, Colonial Office to 
Pelly, 
3 September 1851, forwarding copy of 
Blanshard's despatch for observation.