Colonial Despatches
The colonial despatches of Vancouver Island and British Columbia 1846-1871
Public Offices document
Murdoch and Rogers to Merivale, Herman 19 April 1858, CO 305:9, no. 3854, 318.
Abstract
Public Offices document.
Minutes (5).
Murdoch and Rogers furnish the CO with their report on the HBC accounts in anticipation of the termination
of the Compnay’s grant on Vancouver Island. By their calculations the cost of buying out the HBC will be £25,699.9.11 but if
the Company is allowed to keep their operations the number would be much lower.
The minutes indicate that the CO finds the sum owed as “enormous” and the HBC’s demands
“exorbitant.” They hope that a middle ground can be reached.
Murdoch and Rogers to Merivale (Permanent Under-Secretary)
Emigration Office
19th April 1858
Sir
We have to acknowledge your letter of the 11th ultimo,
enclosing accounts furnished by the Hudsons Bay Company of sums
expended by them in and upon VanCouvers Island, and desiring us
to examine these Accounts and furnish a report for Lord Stanley's information. These accounts are furnished with a view
to the resumption of VancouversIsland
Island
Island by H.M. Government under
the stipulation inserted for that purpose in the Deed of Grant
to the Company of 13th of January 1849. Our Report has been
somewhat delayed by the necessity of personal communication with
a Member of the Hudson's Bay Company.
Island
Island by H.M. Government under
the stipulation inserted for that purpose in the Deed of Grant
to the Company of 13th of January 1849. Our Report has been
somewhat delayed by the necessity of personal communication with
a Member of the Hudson's Bay Company.
2. The stipulation in the Deed of grant above referred to was
to the effect that the Crown should on resumption of the Island
make payment to the Governor and Company
of the sum or sums of
Money theretofore laidout
out and expended by them in and upon the
said Island and premises and of the value of their
establishments property and effects then being thereupon.
Taking these words in their most extensive sense the Hudsons Bay
Company have furnished accounts of the whole of their
expenditure upon the Island, and of the estimated value of all
their trading and other Establishments there.
If it is intended by H.M. Government to remove the Company
altogether from the Island
and to takeover
over the whole of their Establishments of every kind
for the Crown the sums so claimed amounting probably to upwards
of £200,000 will, subject to verification, be due to them. But
we can hardly suppose that this will be considered necessary
if the Company desire to retain their trading
Establishments, or in that case the amount to be reimbursed to them will be
comparatively trifling. We proceed to explain the several items
of the Account.
1.
out and expended by them in and upon the
said Island and premises and of the value of their
establishments property and effects then being thereupon.
Taking these words in their most extensive sense the Hudsons Bay
Company have furnished accounts of the whole of their
expenditure upon the Island, and of the estimated value of all
their trading and other Establishments there.
If it is intended by H.M. Government to remove the Company
altogether from the Island
and to takeover
over the whole of their Establishments of every kind
for the Crown the sums so claimed amounting probably to upwards
of £200,000 will, subject to verification, be due to them. But
we can hardly suppose that this will be considered necessary
if the Company desire to retain their trading
Establishments, or in that case the amount to be reimbursed to them will be
comparatively trifling. We proceed to explain the several items
of the Account.
3. (1) Balance due to the Company £8505.6.11.
This amount is due to the Company on a Debtor and Creditor account called "Trust Account" which appears to have been kept by the Company against the Island from the time of the Grant. The Company debits itself with revenues from Land Sales, Coal Royalties, Licenses &c, and takes credit for payments chiefly of an administrative character—Salaries, roads, militia, Customs, gaols &c. Some charges may requireex=
explanation, such
as payments to Indians for extinction of Claims, but on the
whole the account seems to be of a legitimate character, and
would probably only require to be substantiated by vouchers and
original documents to be admitted.
This amount is due to the Company on a Debtor and Creditor account called "Trust Account" which appears to have been kept by the Company against the Island from the time of the Grant. The Company debits itself with revenues from Land Sales, Coal Royalties, Licenses &c, and takes credit for payments chiefly of an administrative character—Salaries, roads, militia, Customs, gaols &c. Some charges may requireex=
explanation, such
as payments to Indians for extinction of Claims, but on the
whole the account seems to be of a legitimate character, and
would probably only require to be substantiated by vouchers and
original documents to be admitted.
4. (2) Cost of sending out Colonists £25,550.
From previous accounts it appears that a large portion of this sum is the moiety of the estimated cost of sending out between 700 and 800 persons, the other moietybeing
being borne by the Puget
Sound Company and the Fort Rupert Coal Mine. The charge
includes not only conveyance but a twelve months wages, besides
provisions, which the state of the Colony rendered it necessary
to issue to the people. This charge, if supported by evidence
of the actual outlay of the money and of the allotments of one
half of the people to Vancouvers Island, would not appear
objectionable so far as regards the expense of passage money.
But if the Government is to be debited with a years wages &
provisionsfor
for the people it ought to be credited if possible
with the value of their labor during that time. As no doubt
they were employed by the Hudsons Bay Company the simplest
plan would be to set their labor against their wages and
provisions and strike off the charge for the latter.
From previous accounts it appears that a large portion of this sum is the moiety of the estimated cost of sending out between 700 and 800 persons, the other moietybeing
being borne by the Puget
Sound Company and the Fort Rupert Coal Mine. The charge
includes not only conveyance but a twelve months wages, besides
provisions, which the state of the Colony rendered it necessary
to issue to the people. This charge, if supported by evidence
of the actual outlay of the money and of the allotments of one
half of the people to Vancouvers Island, would not appear
objectionable so far as regards the expense of passage money.
But if the Government is to be debited with a years wages &
provisionsfor
for the people it ought to be credited if possible
with the value of their labor during that time. As no doubt
they were employed by the Hudsons Bay Company the simplest
plan would be to set their labor against their wages and
provisions and strike off the charge for the latter.
5. (3) Cost of searching for Coal &c—£12,469.5.7.
For this charge which probably comprizes large amounts for wages it would perhaps be difficult to produce manyvouchers
vouchers, but the
Company ought to produce accounts giving every detail and
extracted from their books, or bonâ fide documents furnished to
them from the Colony. The admission of this charge, however,
and of the four which follow must depend on the decision of the
question, to which we have alluded, whether it is intended to
remove the Company altogether from the Island and take over all
their Establishments—Trading and administrative—or to allow
them to remain in the Island relieving them only of their public
Establishments.
4
(4) Valuation of Farms &c £12,384.—
(5) Do of Mills 3,000.—
(6) Do of Buildings, Fort &c 12,575.—
(7) Inventory at Nanaimo Coal Mine
31st Octr 1855 38,326.9.3
£66,285.9.3
For this charge which probably comprizes large amounts for wages it would perhaps be difficult to produce manyvouchers
vouchers, but the
Company ought to produce accounts giving every detail and
extracted from their books, or bonâ fide documents furnished to
them from the Colony. The admission of this charge, however,
and of the four which follow must depend on the decision of the
question, to which we have alluded, whether it is intended to
remove the Company altogether from the Island and take over all
their Establishments—Trading and administrative—or to allow
them to remain in the Island relieving them only of their public
Establishments.
4
(4) Valuation of Farms &c £12,384.—
(5) Do of Mills 3,000.—
(6) Do of Buildings, Fort &c 12,575.—
(7) Inventory at Nanaimo Coal Mine
31st Octr 1855 38,326.9.3
£66,285.9.3
6. Upon these items making a total of £66285.9.3 no confident
opinion can be formed in this Country. If these Establishments
are to be taken over by the Crown, it will, as it appears to us,
be indispensable to employ some person on behalf of the Crown
to proceed to Vancouvers Island and verify the valuationput
put
upon them by the Company. It will be seen that the Inventory at
Nanaimo Coal Mine is dated 2 1/2 years since, and can,
therefore, be nothing more than a very rough approximation to
the present value of the plant, Coal in hand &c. The expense
of employing a special valuer would be inconsiderable compared
with the large sums to which his valuation would refer.
put
upon them by the Company. It will be seen that the Inventory at
Nanaimo Coal Mine is dated 2 1/2 years since, and can,
therefore, be nothing more than a very rough approximation to
the present value of the plant, Coal in hand &c. The expense
of employing a special valuer would be inconsiderable compared
with the large sums to which his valuation would refer.
7. Besides the above charges amounting in all to £112,810.1.9.
a note at the close of the account alludes to inventories of
goods,stock
stock, and Trading Vessels, valued at £112,889.8.2. and
proceeds to say,
Should these inventories not be assumed by H.M. Government a
serious loss may be sustained by the Hudsons Bay Company in the
event of their Trade being suddenly terminated. An equitable
compensation in such case will have to be agreed upon.
Here again the main question is the continuance of the Companys
trading operations or their assumption by the Crown. If the latter
course should bede=
decided on, this claim, which it will be
observed is very indefinite, must like the preceding be
investigated on the spot.
stock, and Trading Vessels, valued at £112,889.8.2. and
proceeds to say,
Should these inventories not be assumed by H.M. Government a
serious loss may be sustained by the Hudsons Bay Company in the
event of their Trade being suddenly terminated. An equitable
compensation in such case will have to be agreed upon.
Here again the main question is the continuance of the Companys
trading operations or their assumption by the Crown. If the latter
course should bede=
decided on, this claim, which it will be
observed is very indefinite, must like the preceding be
investigated on the spot.
8. In the account No 2 it is stated that the balances of
Settlers on Sales of Land amount to £3,620.7.5. bearing interest
at 5 per Cent. This amount will of course be payable to the
Crown instead of the Company.
9. The result to which we come is that if the Company is removed from VanCouvers Island claims
will arise on their part
under the Deed of Grant, for expenditureand
and property, which in
these accounts are represented by the sum of £225,699.9.11. and
that of these claims upwards of seven ninths would require to be
investigated on the spot. But that if the Company is allowed
and is willing to remain and continue its operations, the amount
to be repaid by the Crown will not exceed £34,000, the items of
which can probably be investigated and settled in this Country.
We would submit, therefore, that before any further steps are
taken in the matter H.M. Government should decideon
on the course
to be adopted on the above point and if they decide to allow the
Company to remain, should ascertain whether the Company are
willing to do so. If the Company continue it will only be
necessary to obtain vouchers for the first two items in their
accounts, vizt, for the balance due on the Trust account and for the cost of sending
out Settlers, and the
account between them and H.M. Government may we should hope be
brought at once to a close.
and property, which in
these accounts are represented by the sum of £225,699.9.11. and
that of these claims upwards of seven ninths would require to be
investigated on the spot. But that if the Company is allowed
and is willing to remain and continue its operations, the amount
to be repaid by the Crown will not exceed £34,000, the items of
which can probably be investigated and settled in this Country.
We would submit, therefore, that before any further steps are
taken in the matter H.M. Government should decideon
on the course
to be adopted on the above point and if they decide to allow the
Company to remain, should ascertain whether the Company are
willing to do so. If the Company continue it will only be
necessary to obtain vouchers for the first two items in their
accounts, vizt, for the balance due on the Trust account and for the cost of sending
out Settlers, and the
account between them and H.M. Government may we should hope be
brought at once to a close.
Herman Merivale Esq.
Colonial Office
Colonial Office
Minutes by CO staff
Mr Merivale
I conclude that the question of account between the Govt & the Hudson's Bay Co in reference to VanCouver's Island will eventually be referred to the Treasury when this report will be found useful.
I conclude that the question of account between the Govt & the Hudson's Bay Co in reference to VanCouver's Island will eventually be referred to the Treasury when this report will be found useful.
ABd
20 Apl
Lord Carnarvon
The great importance of the distinction pointed out by the Commissioners will be seen at once.
The great importance of the distinction pointed out by the Commissioners will be seen at once.
It seems to me that the Company cannot be forced by Government
to surrender their grant of the island, unless Government is
willing to purchase their trading plant as well as their land.
But that on the other hand, if the terms proposed by the Company
are thought exorbitant, the Company cannot force Government to
take the island at all, and must continue their occupation.
This being the case, it is probable some middle course may be
found, not involving the enormous expense which would be
incurred by absolutely buying out the Company.
I can therefore only suggest
negociation with the leading members
of the Company, & probably by conversation
in the first instance, but I do not expect that it will be very
easy to come to terms.
negociation with the leading members
of the Company, & probably by conversation
in the first instance, but I do not expect that it will be very
easy to come to terms.
HM
Apl 28
I will see Capt. Shepherd, and discuss the matter. But first
refer to Law Officers on the question of whether the trading
establishments are included in what we are bound to take off the
hands of the H.B.Co.
S
4
Lord Stanley
The estimated cost in buying out the Company—£225,699.9.11—is enormous and if some middle course can be arrived at without reestablishing exclusive rights & monopolies to the Company in Vancouver's Island it will undoubtedly be very satisfactory. It will therefore probably be desirable as suggested by MrMerivale to hear what terms the H.B.C. will agree to, without compromising your ultimate decision. There are however one or two points wh I would suggest for what they may be worth.
The estimated cost in buying out the Company—£225,699.9.11—is enormous and if some middle course can be arrived at without reestablishing exclusive rights & monopolies to the Company in Vancouver's Island it will undoubtedly be very satisfactory. It will therefore probably be desirable as suggested by MrMerivale to hear what terms the H.B.C. will agree to, without compromising your ultimate decision. There are however one or two points wh I would suggest for what they may be worth.
1. The Balance due to the H.B.C. 8505.6.11. This is part the
L. & E. Commissrs say, of a Trust account: in wh the Company
set off payments made by them on roads, militia, Customs, gaols,
salaries &c against receipts from land sales royalties &c.
Is it quite fair to apply the proceeds of land sales—a
permanent alienation of a great source of revenue wh
diminishes pro tanto the resources of the island—to the
current and annual expenses of militia, salaries, customs? Roads
and gaols are permanent improvements to the Colony
but I almost
doubt whether in fairness the proceeds of land sales ought to be
applied to purposes—wh however necessary in themselves &
forming a part of the general administration of the country—are
of a temporary & somewhat uncertain nature.
but I almost
doubt whether in fairness the proceeds of land sales ought to be
applied to purposes—wh however necessary in themselves &
forming a part of the general administration of the country—are
of a temporary & somewhat uncertain nature.
2.
Sending out Colonists £25,550.
I doubt the propriety of this charge. There is nothing in the
Grant—that I can see—wh pledges directly or indirectly the
Govt to allow it. The terms upon wh the Island is granted to
the H.B.C. for nine years are laid down—the resources wh shall
be at their disposal are stated—their profits from minerals &c
are Limited to 10 per cent—and in consideration of all these
advantages the Company are to establish a settlement of resident
colonists. This is declared to be the object in view for wh
this grant is made—the reason in fact for conferring upon the
Company rights of a very exclusive kind. But if we are
to pay
for such an outlay we might as well have undertaken the
Emigration of these settlers. In the accounts annexed they are
said to be "not required by the Company." That may be so: but
I can see nothing in the Grant wh obliged the Company to send
out persons whom they did not require for their commercial
operations. Has any other condition be[en] made with them on
this subject?
to pay
for such an outlay we might as well have undertaken the
Emigration of these settlers. In the accounts annexed they are
said to be "not required by the Company." That may be so: but
I can see nothing in the Grant wh obliged the Company to send
out persons whom they did not require for their commercial
operations. Has any other condition be[en] made with them on
this subject?
Still less do I understand the principle upon wh one years
wages and provisions are claimed for these settlers. If these
men were really unrequired by the H.B.C. & therefore worthless
to them, one years wages & provisions are not sufficient to
indemnify the Company against the loss sustained and from their
point of view they ought to have claimed more—if on the other
hand they were valuable to the Company either immediately or in
a short time after their arrival they ought to bear the charge.
If they became of value
12 or 18 months after their arrival it
is fair that the Company sd incur the loss of the first year as
they receive the profits of the next eight—if they became
useful on their arrival a portion [of] the burden fairly rests
with the Company. It seems to me—at least without further
explanation—that this claim goes beyond the just limits of
compensation—that we are accepting the loss and leaving them
the gain of the whole transaction. We gave them the island for
nine years upon certain conditions—how far have those
conditions been carried out by them? We are to receive it back
only on a payment of £225,000.
12 or 18 months after their arrival it
is fair that the Company sd incur the loss of the first year as
they receive the profits of the next eight—if they became
useful on their arrival a portion [of] the burden fairly rests
with the Company. It seems to me—at least without further
explanation—that this claim goes beyond the just limits of
compensation—that we are accepting the loss and leaving them
the gain of the whole transaction. We gave them the island for
nine years upon certain conditions—how far have those
conditions been carried out by them? We are to receive it back
only on a payment of £225,000.
3. It is to be ascertained and considered whether the
establishments, buildings &c wh we are under the contemplated
arrangement to take into our hands are such as will be valuable
and
useful to us. They may serve the purposes of the H.B.C. but
be of very inconsiderable use as far as we are concerned.
useful to us. They may serve the purposes of the H.B.C. but
be of very inconsiderable use as far as we are concerned.
4. Searching for Coal £12,469.5.7.
Granting the correctness of the claim of one years wages &
provisions to the settlers sent out by the H.B.C. part of the
cost here wd probably fall within the charge for that first
year—for either the men were directly employed in searching for
minerals, or they relieved others engaged upon different work
and enabled them to search.
5. Land sales
are alluded to in these papers. To whom has land been sold? to
the settlers whose passage we are to pay? to private
individuals? to such a Company as the Puget Sound Company? to
members of the H.B.C. itself? In the next place upon what terms
have those sales been made? has there been any precaution taken
to limit the quantities, the character, the localities of such
purchases? We had experience
a few days since of the mischief
arising out of the unadvised
sale of Thetis Island. Under the Grant the Company are required
to furnish statements of sales of land &c to the Home
Govt—Has this provision been complied with?
a few days since of the mischief
arising out of the unadvised
sale of Thetis Island. Under the Grant the Company are required
to furnish statements of sales of land &c to the Home
Govt—Has this provision been complied with?
These questions I think deserve to be considered before taking
any definite step in this matter.
C
May 1
This matter can only be settled by negociation with the Compy,
and by ascertaining their intentions as to continuance of their
trading establishments on the island.
S
May 3