No. 3

I have the honor to acknowledge the receipt of your Despatch no 5
of the 12th of November last, in which you are pleased to approve of my report of the 21st August, on the state of Vancouver's Island, and
of the general plan of management adopted in our intercourse with the
Northern Indians, who had visited the settlements, during the summer
months.

I observe also with much satisfaction that you have sanctioned the
establishment of a Police Force, for the protection of the settlements,
which in consequence of the Indian war now raging in American Oregon,
may be considered more than ever necessary as a protective measure.

I have communicated to the Council, and through them to the public
at large the encouraging intelligence conveyed in your Despatch,
respecting the interest felt by Her Majesty's Government on behalf of
this Colony, and that hopes are entertained of the extension of the
Reciprocity Treaty with the United States, to this portion of Her
Majesty's Dominions, an event which we are fully convinced will lay the
foundation of a high state of future prosperity for the Colony.
*

The Indian war still continues to desolate Oregon, and
notwithstanding the great exertions made by the Local Authorities and
the Federal Government of the United States who have sent large
reinforcements of regular Troops from California, with supplies of arms
and munitions of war, no impression whatever has been made on the
position of the hostile Tribes in Puget's Sound, who make a boast of
having lost only one man since the commencement of the hostilities. The
American accounts differ from their statements, but the weight of
evidence and the fruits of victory are on the side of the Indians, who
seldom expose their men in bush fighting, or attack their enemy except
at manifest advantage.

Their courage and daring have been lately displayed in an
extraordinary manner, considering the quiet and friendly deportment of
those Indians, when that country was made over to the United States.

The latest incidents of the war are somewhat singular: three full
companies of United States Troops and mounted volunteers marching into
the enemie's country were surprised in a night attack, by a handful of
Indians, and put to flight with the loss of their commanding officer,
several men and a great part of their horses and baggage. The Indians
next made their appearance at a point within three miles of the
principal military station at Steilacoom, and retired unmolested, after
remaining three days in open defiance of the Troops, in their vicinity.
Their latest movement was an attack upon the Town of Seattle in Puget's
Sound, under the Guns of the United States Sloop of war "Decator," and
strange to say they retreated without loss after keeping up a smart fire
of musketry for about eight hours.

Those events prove how formidable, an enemy the Indian may become,
and re-act powerfully on the minds of the natives within the British
Territory, who naturally feel elated at the courage and successes of the
colored races.

There is nevertheless no change observable in their demeanour
towards the British settlements.

I am not however without reasonable grounds of anxiety in regard to
the future, and I trust that the Colony will be frequently visited by
Her Majesty's Ships of war, during the summer months.
**

A body of northern Indians who were suspected of plundering the
deserted habitations of the American settlers, were lately discovered by
a Victoria Indian, in a place of concealment on one of the Islands in
the Canal de Arro, and were driven from thence by a force composed of
ten whites and 25 Victoria Indians, whom I ordered out for the occasion,
and placed under the command of Mr McKay of the Hudson's Bay
Company's service. Mr McKay guided by the Victoria Indian, landed with his men near their hiding place, and by a rush into their
camp took it, without a casualty.

The remains of several oxen were found in their houses, supposed to
have been, at least in part, the property of persons residing in this
Colony.

Two of the number were, in consequence, seized and brought to this
place for trial, and are now confined in the public Jail, but the
remainder of the party took to flight, and have it is supposed gone to
their northern homes.

Thirty eight canoes with upwards of 300 northern Indians, arrived
at this place a few days ago, and a very large number are reported to be
on the route for the settlements. I have in consequence, with the
approbation of the Council, commenced, raising a militia force of 30 men
and officers, who will remain embodied during the presence of those
savages.

This will lead to a serious expense, but I conceive it would be
unwise to neglect so necessary a precaution, in the present
circumstances of the Colony, more especially when it is considered that
the maintenance of a small force now may have the effect of preventing
much future evil and expense to the Colony.

I have the honor of transmitting herewith for your information copy
of the Minutes of a Council held on the 27th day of February, and I
trust you will approve of the measures adopted in respect to the
District Schools, and for the defense, and for carrying on the public
business of the Colony.

The men who have offered for the Militia Corps, have been enlisted
at 2 Sterling a month for privates, being considerably less than the
pay sanctioned by Council, which it is not my intention to allow, as
long as men can be procured at a lower rate.

In fixing the pay of the Militia at one dollar a day, for Privates,
the Council, had in view, that the Volunteers raised in the United
States Territory receive from their Government, two dollars a day and
rations, and it appeared then a matter of doubt whether men could be
raised in this Colony, for the public service, without the stimulus of
high pay.

I have nothing further of much importance respecting the Colony
to communicate at present.