No. 2, Miscellaneous

1. I have the honor to acknowledge the receipt of your Despatch No
60, 1st November 1864 informing me that you had received from the
Hudson's Bay Company the copy of an Information filed by the Attorney
General of Vancouver Island against that Company praying that the
sales of certain public lands alleged by them to have been made prior
to the Agreement with Her Majesty's Government of February 1862 may
be set aside and requesting an explanation from me on the subject.

2. In reply thereto I beg to enclose a copy of correspondence on
this subject

*

which explains itself and will supply the information you require.

3. You will observe that this suit, the terms of which were from
time to time amended, was instituted by my Predecessor so far back as
May 1861.

4. I did not possess the requisite knowledge of this much debated
subject, nor did I feel justified in interfering with the action of
the Attorney General instructed by my Predecessor till Mr Cary
resigned office on the 22nd August 1864 when I called upon the
Acting Attorney General, Mr Wood, in a letter dated 9th September
1864 for a statement of the object of the suit so long pending, and
received his reply (herewith) dated October 6th 1864 which conveys
all the information I can at present offer.

5. You will further observe that this letter of the Acting Attorney
General was transmitted by me to Mr J.D. Pemberton, late Surveyor
General, in whose name the suit was instituted, for his remarks,
which will be found herewith in a confidential letter dated 17th
October 1864.

6. The Minute of the Acting Attorney General on Mr Pemberton's
letter dated 14th November 1864 I laid before my Executive Council
when a decision in accordance with his recommendation was come to

**

and the suit abandoned.

7. The subsequent letters named in the margin (herewith)

***

will, with the Council Minute thereon, bring the proceedings up to
the present date.

8. It is very difficult to deal with a part only of this large and
complicated question, and the difficulty is greatly increased by the
absence of my Predecessor, and Mr Young, Colonial Secretary, who
appear to have conducted much of this and other business verbally.

9. The action of the local Legislature has rendered it compulsory
upon me to lay the question as a whole before you, and which I
purpose to do as early as possible. In the mean time I do not think
the Hudson's Bay Company can sustain injury or inconvenience from the
last step I have been advised to take. I have no intention of
pressing the suit proposed in the letter of the Messrs Pearkes and
Green (and approved by the Attorney General) dated 3rd December till
I receive your instructions.

10. The subject of my Despatch of this date, No 1, is a branch of
this matter.

11. You may be sure that I will not lend my sanction to any hasty or
partisan proceeding against the Hudson's Bay Company.

12. I feel confident that the Hudson's Bay Company would disclaim
any proceeding by whomsoever taken which could in any way compromise
their deservedly high character, but at the same time I lean to the
opinion that the proverbial bitterness of a family quarrel which
unhappily existed between the Gentlemen who represented the Hudson's
Bay Company and the Crown prior to my arrival here unconsciously led
both into errors of judgment which has resulted in great
complications and mischief to the Colony, and which nothing but a
Court of Law, a Special Commission, or Arbitration can now correct.
Of these I would for the interests of all parties recommend
arbitration. Two honorable and unbiassed men with power to take
evidence on oath and call for papers could settle the questions at
little cost of time or money. It is one of those subjects on which a
correspondence may be kept up for years without any result.

13. I have no desire to shrink from any responsibility Her Majesty's
Government may please to put upon me, but I think as Governor of this
Colony where impartiality is all-important, it would for numerous
reasons be inexpedient to make me judge in a matter which has
elicited such bitter partisan feeling among the whole community.

14. I should be less likely to afford satisfaction inasmuch as the
Gentlemen employed by and representing the Hudson's Bay Company in
this Colony have shown a very persistent and unmistakeable hostility
to my administration from a period anterior to my arrival.

15. You will observe that the suit in question was commenced against
the Hudson's Bay Company in May 1861, and that it was abandoned some
months before I received your Despatch now under reply.

16. For what reasons the Hudson's Bay Company abstained from
bringing it under the notice of the Secretary of State during my
Predecessor's term of Office which expired in March 1864 is a matter
I cannot explain.