No. 35
               
            
            
            
            
               1.  Since I had the honor of addressing you on the 
15th of July
               last, concerning the Gold fields in the interior of the continent north
               of the 49
th parallel of latitude, which for the sake of brevity, I
               will hereafter speak of as the "Couteau Mines," (so named after the
               Tribe of Indians who inhabit the
country)
  country), I have received further
               intelligence from my correspondents in that quarter.
               
               2.  It appears from their reports that the auriferous character of
               the country is becoming daily more developed through the exertions of
               the native Indian Tribes who having tasted the sweets of gold finding,
               are devoting much of their time and attention to that pursuit.
               
            
            
               3.  They are however at present almost destitute of tools for
               moving the soil, and of washing implements for separating the gold from
               the earthy matrix and have therefore to pick it out with Knives or to
               use their fingers for that purpose; a circumstance which in some measure
               accounts
for
 
               for the small product of gold up to the present time, the
               export being only about 300 ounces since the 
6th of last October.
               
               4th  The same circumstance will also serve to reconcile the
               opinion now generally entertained of the richness of the gold deposits
               by the few experienced Miners, who have seen the "Couteau" country with
               the present paucity of production.
               
            
            
               5.  The reputed wealth of the "Couteau Mines" is causing much
               excitement among the population of the United States Territories of
               
Washington and 
Oregon, and I have no doubt that a great number of people
               from those Territories will be attracted thither with the return of the
               fine weather in spring.
               
 
            
            
               6.  In that case difficulties between the natives and whites will
               be of frequent occurrence and unless some measures of prevention are
               taken the country will soon become the scene of lawless mis-rule.
               
            
            
               7. In my letter of the 15th of July, I took the liberty of suggesting the appointment of an Officer invested with authority
               to
               protect the natives from violence and generally as far as possible to
               maintain the peace of the country.
               
            
            
               8.  Presuming that you will approve of that suggestion I have as a
               preparatory step, towards the proposed measures for the preservation of
               peace and order this day, issued a proclamation declaring the rights of
               the crown in respect to gold found in its
natural
 
               natural place of deposit
               within the limits of 
Fraser's River and 
Thompson's River Districts,
               within which are situated the "Couteau Mines," and forbidding all
               persons to dig or disturb the soil in search of Gold until authorized on
               that behalf by Her Majesty's Colonial Government.
               
               9.  I herewith forward a copy of that proclamation, and also of the
               regulations since published setting forth the terms on which Licenses
               will be issued to legalize the search for gold on payment of a fee of
               ten shillings a month payable in advance. [Marginal note: Enclosures 1
               & 2]
               
            
            
               10. When Mining becomes a remunerative employment and there is
               proof of the extent and productiveness of the gold deposits I would
               propose that the License fee be
gradually
 gradually increased, in such a manner
               however as not to be higher than the persons engaged in mining can
               readily pay.
               
               11.  As it is particularly desirable to place a legal check on the
               movements of American citizens and to prevent them from entering the
               British Territory either for Mining or other purposes, I propose having
               the Proclamation and the License regulations now issued, published in
               the 
Oregon and 
Washington Territory weekly Journals, so that the laws
               regulating and legalizing the search for gold may be generally known,
               and that American citizens may not have the excuse of ignorance to plead
               in extenuation of breaches of the law.
               
 
            
            
               12.  My authority for issuing that Proclamation, seeing that it
               refers to certain Districts of Continental America, which are not
               strictly speaking within the Jurisdiction of this Government may perhaps
               be called in question, but I trust that the motives which have
               influenced me on this occasion, and the fact of my being invested with
               the authority, over the premises, of the Hudson's Bay Company; and the
               only authority commissioned by Her Majesty within reach, will plead my
               excuse. Moreover should Her Majesty's Government not deem it advisable
               to enforce the rights of the Crown as set forth in the Proclamation, it
               may be allowed to fall to the ground, and
to
 to become a mere dead letter.
               
               13.  If you think it expedient that I should visit the "Couteau
               Mines," in course of the coming spring or summer, for the purpose of
               enquiring into the state of the country, and authorize me to do so, if I
               can for a time conveniently leave this Colony, I freely place my
               services at the disposal of Her Majesty's Government.
               
            
            
               I have the honor to be Sir
               
               Your most obedient humble Servant
               
               
James Douglas
               
               Governor
               
               
               
               
The Right 
Honble Henry Labouchere Esq
re
               
               Her Majesty's principal Secretary of State
               
               For the Colonial Department.
               Minutes by CO staff
               
                
                  
                  
                     Mr Merivale
                     The 
Govr has shaped his proceedings according to the instructions
                     concerning licenses &c which 
Sir J. Pakington gave him in 
/52, when gold was discovered in 
Queen Charlotte's Isld. See annexed P.P. 788 Page
                     12.  I think myself that the Hudson's Bay C
o, who are at present the
                     beneficiares under the license, 
shd be requested to provide the
                     necessary funds for the appointment of the proposed Officer, & that steps 
shd be taken forthwith for that purpose.
                     
 
                  
                  
                   
            
            
            
               Other documents included in the file
               
               
                   
                     
                     
                        Draft warrant appointing 
Douglas to be "Lieutenant Governor of HM's
                        Territories and Possessions in North America which are bounded on the
                        North by the 54
h Degree of North Latitude, on the East by the 
Rocky
                           Mountains and on the South by the 49
h Degree of North Latitude."
                        
                        Minutes by CO staff
                        
                         
                           
                           
                              This warrant I think will do: But it will require to be carefully
                              explained to the Governor, and to the HB Co. also:  & I think
                              considering the peculiarity of the case, it may be as well to have the
                              Law Advisers' concurrence?
                              
                           
                           
                            
                      
               
               
               
               
               
                   
                     
                     
                        Draft, Colonial Office to Attorney General and Solicitor General,
                        22 April 1858, asking that they "peruse and settle" the annexed
                        draft warrant, with explanation.
                        
                     
                     
                     
                        Minutes by CO staff
                        
                         
                           
                           
                              It is very irregular that we cannot find any authentic information
                              whether there are any magistrates appointed by the Crown in the licensed
                              territory. 
Mr Ellice in his evidence, 5888, says there 
are,
                              
Mr Barr the Company's legal adviser assures me there are 
not.
                              It would be important to ascertain the fact.  And I think the new Lieut.
                              Gov. should also have a Commission as such Magistrate.
                              
 
                           
                           
                           
                           
                              Gov. Douglas deserves in my opinion much credit for acting—as he
                              always has done—with promptitude & intelligence in the line pointed out
                              to him by the home Government, and making light of difficulties instead
                              of creating them, in a position by no means clear & with very little
                              assistance of any kind.
                              
 
                           
                           
                              But I must refer to a former minute on 8657.  There is no legal
                              authority in North-Western America, except, for certain purposes, the
                              Courts of justice in Canada. The H.B.Co. have under Act of Parl
t a
                              license for exclusive trade with the Indians

 
                              in that territory until 
May
                                 1859, but they have no other authority whatever.  
Govr Douglas (a
                              servant of the Company) has no authority from the Crown beyond
                              
Vancouver's Island "and its dependencies" whatever that may mean.  His
                              proclamation I take therefore to be wholly without legal force, until
                              adopted by the Crown (which I apprehend it should be).
                              
                              It is competent for the Crown, notwithstanding the Existing
                              license, to erect at any time any portion of the 
N.W. Territory into a
                              colony, and to abolish the exclusive trade within the colony so erected.
                              
                              And I am inclined to think that, without interfering with the
                              Company's license at all, it might be practicable, and convenient,

 
                              to
                              issue an ordinary Lieut. Governor's commission to 
Gov. Douglas, over a
                              certain portion of the 
N.W. Territory (say between lat. 49
o & 53
o
                              or 54
o N.).  This would give him at least a semblance of authority,
                              which would also be useful in the Event of possible complications with
                              the U.S. arising out of the Mormon affair (it having been previously
                              suggested to us as probable that 
Brigham Young when hard pressed may
                              convey his Community into the British territories).
                              
                              The only objection I see to this course would be that it would, no
                              doubt, attract a certain number of adventurers, who would treat it

 
                              as an
                              invitation to insult the Company's monopoly.
                              
                              As to the plan of granting gold "licences" adopted by the Governor
                              on our suggestion, it is one which works well for a time & occasionally,
                              because those who have paid for their license combine with the
                              authorities to keep out interlopers.  But it becomes unpopular as soon
                              as profits fall off, and has been abolished in 
Victoria for some time.
                              
                           
                           
                           
                           
                              But several questns arise as to the future.
                              
                           
                           
                              If we erect into a colony a tract now in hands of the H.B.C., by
                              giving Gov. D. a Commission over it, do we thereby 
necessarily
                              put an

 
                              end to the license for exclusive trade?  Or can the two co-exist
                              for a time?
                              
                              Except in case of necessity, I shd be reluctant to deal with the
                              license quesn (I mean the H.B.C. monopoly) except as a whole.
                              
                           
                           
                              If the exclusive rights are not destroyed, there can be no claim
                              for compensatn.  If they are destroyed, I fear such a claim, though
                              not for one year, will be raised.
                              
                           
                           
                              If there is a doubt as to our posn relatively to the H.B.C.
                              might not the law officers be consulted?
                              
                           
                           
                              I refer this to 
Mr Merivale's judgment, & ask him for further
                              inform
n.
                              
 
                        
                        
                           
                           
                              See 2459 since arrived.
                              
                           
                           
                              My own opinion is that under the existing license the Crown might
                              constitute, legally, a Colony in

 
                              Northwestern America, within the
                              "licensed" territory, and yet not give the colonists the right of
                              trading with the Indians during the continuance of such license.  But I
                              would submit that this would practically be an impossible course.
                              Colonists could not be freely offered land at the fixed terms of
                              purchase (which is essential to the modern way of colonization) and at
                              the same time restricted from trading with Indians on their own soil;
                              which would nevertheless be a necessary restriction if the license
                              monopoly is to be maintained in its integrity.  No attempt was made to
                              maintain the monopoly in 
Vanc. I. after it became a colony:  I mean in
                              point of 
law, though practically the Company retains it to a
                              considerable extent.  See 
Mr Cooper's evidence 3838 & (Report).
                              
 
                        
                        
                           
                           
                              The license so clearly contemplates that the exclusive trade should
                              be abolished wherever a colony is constituted, that I cannot think there
                              would be any claim for compensation.
                              
                            
                           
                           
                              I would observe in addition that the Act 1 & 2 Geo 4. c. 66.
                              sec
t 10.11.12. makes provision for the appointment of Magistrates &
                              administration of justice throughout the 
Northwestern Territory.  So
                              that, strictly speaking, we possess probably the machinery for keeping
                              things in order, if the gold discovery on 
Fraser's River should be
                              realized, until 
May 1859, without creating a colony.
                              
 
                        
                        
                           
                           
                              I agree that a Commission as Lieut. Gov. 
shd be issued to 
Gov. Douglas, extending over a district sufficient to cover the gold fields.
                              
 
                         
                      
             
            
            
            
               Documents enclosed with the main document (not transcribed)
               
                
                  
                  
                     1. Proclamation by 
Douglas, 
28 December 1857, respecting the disposition of the gold fields within the 
Fraser and 
Thompson River Districts.
                     
 
                  
                  
                     2.  Regulations governing the issuance of gold licenses for the
                     region outlined in the above proclamation, signed by 
Douglas, 
29
                        December 1857, setting license fees "for the present" at ten shillings
                     per month, payable in advance, obtainable at 
Victoria.
                     
                     
 
            
            
            
            
            
            
               
                  People in this document
                  Barr, Robert
                  
                        Blackwood, Arthur Johnstone
                  
                        Carnarvon, Earl
                  
                        Cooper, James
                  
                        Douglas, Sir James
                  
                        Ellice,  Edward
                        
                  Labouchere, Henry
                  Merivale, Herman
                  Pakington, Captain John Somerset
                  Stanley, Lord Edward Henry
                  
                        Young, Brigham
                        
                
               
                  Places in this document
                  Couteau River
                  Fraser River
                  Fraser River District
                  Haida Gwaii
                  North-West Territory (1825)
                  Oregon Territory, or Columbia District
                  The Rocky Mountains
                  Thompson Region
                  Thompson River
                  Vancouver Island
                  Victoria
                  Washington Territory