Colonial Despatches

I have to acknowledge your letter of 26th instant, with one from the Treasury dissenting from the Duke of Newcastle's proposal to offer the Hudsons Bay Co £35,000, but consenting to the offer to them of £30,000, in addition to the £25,000 already paid, in full of all their claims on the resumption by the Crown of Vancouvers Island—on condition that £5000 of that amount be considered as an advance repayable by the Colony at the earliest possible opportunity.

2. I see no objection to the payment of a portion of the repurchase money out of the Funds of the Colony provided the essential interests of the Colony are not thereby interfered with. The expenditure of the Company must have been beneficial to the Colony and there is no injustice in requiring the Colonists to contribute towards the expense of the benefits they thus obtain. But whether the Hudson's Bay Co will be willing to accept the amount proposed by the Treasury is more open to question. The whole amount of their outstanding claim is upwards of £49,000, and although we have reason to know that they would compromize that claim for £35,000 they have peremptorily refused to accept any less sum. It is of course needless to speculate on the steps to be taken should they refuse the proposal [marginal note: made on the (1?) June last] about to be made to them, but it would be unwise to assume that they will certainly accept it.