Murdoch to Elliot (Assistant Under-Secretary)

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.