No. 23, Miscellaneous
               
            
            
            
            
               1.  I have the honor to acknowledge the receipt of your Despatch No
               38 dated 16th September 1864 on the subject of the Crown Lands and
               Civil List of this Colony.
               
            
            
               2.  I have deferred entering upon this subject in the hope of the
               Legislative Assembly arriving at some definite and reasonable
               decision upon it.
               
            3.  The 
            
            
               3.  The Legislative Assembly was in Session when I assumed the
               Government of this Colony, and a Select Committee occupied in taking
               evidence as to "the present condition of the Crown Lands with
               reference to the proposal of Her Majesty's Secretary of State for the
               Colonies dated 15th June 1863 to hand over the Crown Lands to the
               Legislature."
               
            
            
               4.  Their proceedings extended over a period of eight months and I
               now transmit a copy of the Minutes of Proceedings of the Select
               Committee accompanied
by
 by a Report dated 
14th June 1864 and
               Resolutions on the same subject dated 
June 29th 1864.
               
               5.  The manuscript of some of these documents was very imperfect and
               there was consequently great delay in having them printed.
               
            
            
               6.  With these documents before you it is unnecessary for me to
               trouble you with any lengthened remarks upon them.  No analysis of
               mine would make them intelligible where many Members of the Assembly
               sought to prove opposite and
different
 different things.
               
               7.  I do not attach much weight to the Evidence which has not been
               taken on oath, and it is difficult to form a sound opinion upon a
               matter surrounded by such complications and conflicting statements.
               
            
            
               8.  There are nevertheless some extraordinary facts connected with
               the sale and management of the Crown Lands disclosed in the Minutes
               of Proceedings before the Select Committee which I apprehend are new
               to Her
Majesty's
 Majesty's Government.
               
               9.  If the question is to be re-opened, and the Indenture between the
               Crown and the Hudson's Bay Company dated 
3rd February 1862,
               reconsidered or questioned, it can only be done effectually and
               fairly by a Commission appointed to inquire on the spot, where books,
               papers, maps, and evidence could be produced, and in the event of a
               new Chief Justice being appointed he might fitly be entrusted with
such
               such a duty.  I am not however in a position to recommend that course
               if the question can be settled and an agitation detrimental to the
               best interests of the Colony put an end to by any other means.
               
               10.  I have endeavoured by every means at my disposal to effect a
               settlement of this question, but in vain.  There are various and
               conflicting interests which under the existing form of Government in
               this Colony are wholly beyond my control.
I
  I have no public officer
               in the Assembly to advocate the real interests of the Colony or to
               correct misapprehensions and even misstatements which have entered
               largely into the numerous debates which have taken place.
               
               11.  The question will again shortly come before the Legislative
               Assembly in connection with the annual Estimates and salaries of
               officers which with the exception of that of the Colonial Secretary
               I have declined to charge against Crown Revenue
till
 till the conditions
               proposed in the Secretary of State's Despatch, 
15th June 1863, are
               accepted or modified by your authority.  I will communicate the
               result when arrived at.
               
               I have the honor to be,
               Sir,
               Your most obedient Servant
               
A.E. Kennedy
               Governor
               
               Minutes by CO staff
               
                
                  
                  
                     Mr Elliot
                     As the celebrated Indenture of 
Feb/62 was arranged by the Land Board
                     I think there is no help for it, but to refer this despatch to that
                     Office for report and to request that their report may be made as
                     soon as convenient.
                     
 
                  
                  
                     If the suggestion of referring the matter to the new Chief Justice be
                     approved "twere well" that the report "be done quickly" for Mr
                     Needham is going out in a few weeks.
                     
                  
                  
                   
                  
                  
                     In 
1863 the 
D. of Newcastle engaged to surrender the Crown Land
                     Revenue to the H. of Assembly provided the House undertook to provide
                     certain salaries.
                     
                     A committee of the House was thereupon appointed to consider the
                     condition of the Crown Lands as a source of Revenue.
                     
                  
                  
                     The Report of the Committee with Minutes of evidence and Resolutions
                     founded upon the Report are with 6183.
                     
                  
                  
                     The House has not come to any decision upon the proposal made in
                     
1863.  They express however the opinion that the agreement of 
1862
                     between the Crown and the H.B. Company ought to be annulled and that
                     the Colony will be seriously injured if it is not annulled, and they
                     request that proceedings may be taken with

 that object.
                     
                     They wd not interfere with the rights of third parties but they wd
                     oblige the Company to compensate the Government for the Sale of any
                     portions of Govt Reserves.
                     
                  
                  
                     They ask that pending such proceedings the Company may not be
                     confirmed in the possession of unsold lands and they particularly
                     request that the title of
                     
Mr Lowenberg to Lot Z which is in transition may not be
                     confirmed.
                     
                     Governor K. in 6183 suggests that the whole matter should be made the
                     subject of a Commission of inquiry.
                     
 
                  
                  
                     The sale of lot Z, although dragged into the wider question, is a
                     question by itself and, distinct from other subjects,

 has been the
                     subject of correspondence since 
1861.
                     
                     The latest despatch upon it as a separate question is 2637 in which
                     
Governor K suggested that the Government 
shd resume lot Z upon
                     payment of the price paid for it by 
Mr Lowenberg if the Company
                     insisted upon it but expressed the opinion that the C
o certainly
                     ought to relinquish lot Z.
                     
                     The Colonial office, Emign office and Law officers were agreed that
                     the Indenture of 1862 cannot be cancelled.
                     
                  
                  
                     The Emig
n Comm
rs (6606, 3034) were of opinion that the Sale of lot
                     Z as a distinct question should be made the subject of legal
                     proceedings first before the Supreme Court in the Colony and secondly
                     in the event of an unfavourable decision before

 the Privy Council at
                     home.
                     
                     On the other hand the Law officers are of opinion that lot Z was
                     never dedicated as part of a Govt Reserve in any binding manner in
                     which case its sale could not be questioned at law with any prospect
                     of success.
                     
                  
                  
                     The alternative left is that of letting it (lot Z) alone or of
                     resuming it upon compensating 
Mr Lowenberg whether by arrangement
                     between him & the local 
Govt or under a local act.
                     
 
            
            
               Documents enclosed with the main document (not transcribed)
               
                
                  
                  
                     Kennedy to [Colonial Office], 
15 May 1865, advising that a
                     copy of the Resolutions of the Legislative Assembly of 
June 1864
                     would be forwarded to the colonial office in the duplicate of
                     Despatch No. 23 dated 
15 April 1865.
                     
 
                   
                  
                  
                     Printed copy of "Minutes of Proceedings of a Select Committee
                     of the House of Assembly appointed to inquire into the present condition
                     of the Crown Lands of the Colony, with reference to the proposal of Her
                     Majesty's Secretary of State for the Colonies, dated 15th June, 1863,
                     to hand over the Crown Lands to the Legislature" (forty-two pages).
                     
                   
                  
                  
                     Printed copy of "Report of the Committee on Crown Lands,
                     
Vancouver Island, 
June 14th, 1864" (fifteen pages).
                     
 
                  
                  
                     Printed copy of resolutions confirmed by the House of Assembly
                     on 
29 June 1864 upon receipt of the report as noted above, signed by
                     
J.S. Helmcken, Speaker.
                     
 
                  
                  
                     Printed copy of "Despatches and Correspondence transmitted to
                     the House of Assembly in 
Governor Douglas' Message of 
3rd September
                        1863" (thirty-six pages).
                     
                     
 
            
            
               Other documents included in the file
               
                
                  
                  
                     Elliot to Emigration Commissioners, 
11 July 1865, forwarding
                     copy of the despatch and enclosures for their observations and
                     suggestions.