Colonial Despatches

I have the honor to acknowledge receipt of Despatch No 32, of the 24th August forwarding for my report copy of a letter received from the Governor of the Hudson's Bay Company in reply to my Despatches dated respectively 16 February and 28 March 1860 uponupon the subject of the claim put forth by the Hudsons Bay Co to the proceeds of the sale of a portion of Government land.

2. I scarcely expected after the clear proof I exhibited in my Despatch of the 28th March, not only of the right of the Colonial Government to the land, but also of the original intention of the Hudsons Bay Company with respect to such land, that the Company would have further pressed a claim which at first I was inclined to believe had onlyonly been preferred by the Directors through a misconception of the actual facts of the case; but from the perusal of Mr Berens letter I perceive that the Company although relinquishing one part of their claim—viz the Buildings—do not seem disposed to resign the other—the land.

3. The letter of Mr Berens is a fair narration of some of the circumstances concurrent with the erection of the Buildings and the appropriation of the land, and the facts stated are substantially correct, but I do notnot see that he throws any fresh light upon the claim the Fur Trade branch of the Company have made, or that he in any way strengthens their position. On the contrary I think his letter contains clear evidence that the Fur Trade have neither a legal nor an equitable title to the land in question. Had the Company adopted my proposition in the first instance, made as their Agent, of leasing to the Colony the Buildings required by the Government, the matter might wear a different complexion; althoughalthough even then I am not sure that such an arrangement could have been confirmed under the Charter of grant of the whole Island to the company, which expressly restricted the sale of lands to such as were not required for public purposes—such public purposes I take it to mean lands required for purposes in connection with the Government of the Colony; but the company did not approve of my suggeston and the cost of the buildings was in consequence borne by the Colony, and the LandLand appropriated to them was retained and set apart as a Government reserve up to the period of its sale under the authority of the Despatch to Governor Blanshard from the Secretary of the Company dated 1st January 1851, which provides that the Buildings required for Government purposes are to "be near the Fort Victoria for convenience and protection" and also that the 2 "lands which may be appropriated with the Buildings are to be held by the Governor and Council as Trustees for the Colony." These two points whichwhich I brought forward in my Despatch of the 28 March, to my mind conclusively settle the question, and the more so as I notice that they are not touched upon by Mr Berens. To have adopted the expedient alluded to by Mr Berens of the Fur Trade retaining the Buildings, and other Buildings being erected upon a different site not claimed by the Fur Trade, would have been simply absurd; for that would have necessitated the removal of the Government Buildings from the Settlement altogether, andand would have placed them in the then almost untrodden wilderness. But in the quotation used by Mr BerensM from the letter of Sir J.H. Pelly, it would appear that in all cases of Reserves of land if any part was required for public purposes, it might be resumed upon repaying the price and any improvements that might have been made upon it. For better information I enclose a copy of the whole of that letter, which I should not have done from motives of delicacydelicacy the word "private" being marked upon it, but as Mr Berens has alluded to it as an official document, which in point of fact it is—and as some most material points can be gathered from it, I do not longer hesitate to produce it. That letter, in my opinion, clearly establishes the point that if any portion of land reserved for the Fur Trade, or Puget Sound Company, were required for public purposes, it might be resumed upon two conditions, first, repayment of its original costcost, and secondly, compensation being made for any improvements upon it; but in the case under discussion, no repayment of the original price of the land was required, the Fur Trade having paid nothing for it then, (nor have they, I believe, up to this day, made any payment for the 3084 Acres claimed by them), and no compensation was necessary, no expenditure having been made in improvements.

4. A consideration of these circumstances I think fairly proves that the Fur Trade can have nono claim whatever to the proceeds of the land when sold in 1859. It is shewn that the land was required for public purposes and was taken possesion of by the Government in 1851. It was retained by the Government and treated as a Government Reserve down to 1859, and the most that the Fur Trade could ever be entitled to claim would be a refund of the money paid by them for it prior to 1851, but they have not even this claim inasmuch as they never paid for it at all.

5. Your Grace will perceive thatthat I have written upon the assumption that the land around Fort Victoria does belong to the Fur Trade branch of the Hudsons Bay Company, and I have refrained from questioning the validity of their claim to it at all. That question I notice is to be considered by the Judicial Committee of the Privy Council; and whether the claim be allowed or not I conceive makes no difference in the position of this Government. The entire case is I think stated in the 4h Paragraph of this Despatch, and the points there enumerated seem to me to decide the matter.

6. There is however one further point which is somewhat material. Mr Berens mentions in the last paragraph but one of his letter that the Fur Trade claim of 3084 Acres was entered in the land Register as belonging to the Company. I have referred to the Register, and I find therein a Memorandum signed by the Secretary of the Hudsons Bay Company and dated 7 January 1859, containing a copy of a minute of resolution made on the 26 September 1853 (nearly 3 years after the portion of land now claimed by the Fur Trade was inin possession of the Government) that the 3084 Acres should be entered as belonging to the Company. A Form of Title Deed was also filled in and sent home, but it would seem never to have been executed.

7. Considering that some legal points were involved in the question, I placed the whole of the papers before the Attorney General, and I forward herewith his opinion for Your Graces information.

8. With reference to the information required in your DespatchDespatch as to whether the produce of the sale of the Buildings has been carried to the credit of the Colonial Government, I beg to state that as far as I am aware that amount has not been so credited, although the cost of all the Buildings erected upon the disputed land was charged to the Colony.