Berens to Newcastle

I have the honor to acknowledge the receipt of Mr Merivale's letter
of the 7th instant in which he informs me that Governor Douglas has
reported, with respect to the advance of $27,000 made by Mr Dallas
the Representative of this Company in Vancouver's Island, to defray
the expense of Public Buildings at Victoria that it was
"met by the surrender to Mr Dallas of the site of the Old Public
Offices on condition of his placing at the disposal of Governor
Douglas the sum of money obtained by the Sale."
Mr Merivale requests of me to inform your Grace whether any
intimation has been received by this Company of the sale of this
land, and of the arrangement made with Mr Dallas.

The letter which I had the honor of addressing to your Grace on the
4th ulto, and with which I transmitted a Copy of Mr Dallas' letter
to the Secretary of this Company of the 14th September, contains the
latest information we have received upon the subject, and, by
reference to it, your Grace will observe that at that period no
reference is made to the Sale of the Land in question and I
consequently presume that it had not then been sold.

*

With respect to the arrangement made between Governor Douglas and Mr
Dallas in regard to the advance made by the latter of $27,000 I am at
a loss to understand how under any circumstances it could have been
provided for in the manner which Governor Douglas appears to have
represented, because, as we read his communication, while on the one
hand it is suggested that the advance in question was met by the
surrender to Mr Dallas of the site of the old public offices, it is
added on the other that this surrender is made on the condition of
Mr Dallas placing at the disposal of Governor Douglas the sum of
money obtained by the Sale. Unless it is meant that the Government
are to be responsible to the Company for the amount of such sale,
this Company would appear literally to receive nothing in respect of
the advance that has been made.

**

But in point of fact, this Company entirely denies the right or power
of Governor Douglas to deal with the land in question at all, as it
formed part of the property possessed by this Company in the Island
before the Grant made to them by the Crown and therefore entirely
irrespective of it;

***

but we have been informed by Mr Dallas that
Governor Douglas had attempted to treat this property as belonging to
the Government, and upon that pretention

had advertised it for Sale.
This course of proceeding was immediately protested against by Mr
Dallas on the part of the Company and, as we gather from Mr Dallas'
communications, it was distinctly understood that inasmuch as the
preparations for the Sale had proceeded so far, and in order not to
cast a slur upon the proceedings of the Governor, who admitted it to
be Fur Trade Land,

****

the sale should be proceeded with under Mr Dallas'
directions, and on account of the Hudson's Bay Company. It was also
arranged between Governor Douglas and Mr Dallas that as the Public
buildings were urgently required, Mr Dallas should advance—not the
amount of the sale of the land—but the specific sum of $27,000, to
enable Governor Douglas to proceed with the proposed Buildings,

*****

it being distinctly understood that this advance was a loan which was
to be reimbursed to the Hudson's Bay Company along with the other
payments made by the Company under the provisions of Her Majesty's
Grant.

I take leave to add that Mr Dallas' views are entirely borne out by
the facts. The land upon which the old Buildings stand was the
undoubted property of the Hudson's Bay Company before the Grant to
them of the Island. The Buildings upon it were also erected at the
expense of the Hudson's Bay Company. Indeed Governor Douglas has
admitted that both the land and the Buildings belong to the Company
as your Grace will see by reference to his address to the House of
Assembly of the 7th May, and that fact was confirmed by Mr
Pemberton, the Colonial Surveyor, in the course of a debate on the
subject which took place on the 17th May last.

The land upon which Governor Douglas is now erecting the New Public
Offices has also been represented by that Gentleman to be Government
property, but I have reason to know that it is part of the land held
by the Fur Trade long prior to the Grant from the Crown. The Company
therefore will have no claim upon the Government for the value of
this land.

From this statement I trust I have made it evident to your Grace,
that the advance of $27,000 was actually a loan by this Company on
Government account, and that Governor Douglas is in no way justified
in representing the advance as being "met by the surrender to Mr
Dallas of the site of the old buildings."

In order to place before your Grace information on the subject I have
the honor of transmitting herewith an Extract from the Address of
Governor Douglas to the Assembly on the 7th of May last, and a Copy
of Mr Pemberton's speech in the Assembly on the 17th of the same
month.