De mostly in the hands of persons who frankly owned themselves squatters on Crown Land being ither stragglers from the stone cutters villages on the water's edge or boat people who found the chief art of their subsistence upon, the sea.

We found, however, that the water front extending from the Lyeemoon Pass to the western rner of Kowloon Bay was covered by a network of large claims mostly laid by persons who had quired their title by purchase since or about the time of the Convention, influenced, no doubt, by the excellent sites available for docks and other industrial enterprises.

After an extensive enquiry lasting over several months, during which we took the evidence of come 160 witnesses, the majority of these large claims were entirely disallowed on the ground usually that the vendors could show no legal (or indeed equitable) title by Chinese Law.

11. In many cases the amount of the consideration money paid by the purchaser was absurdly low, in others, payment of the whole sum was reserved and the full amount was to be finally handed over only after a good title had been shown by the vendors. It seems, therefore, permissible to believe that these purchases were often regarded merely as a promising speculation by the persons concluding them.

In the case of one claim, aggregating some 200 acres in extent and comprising a wide extent of ill-side and valley, the Chinese claimants had made an agreement for sale to a European gentleman sident in the Colony who had conceived an enterprising plan for augmenting the local food supply by the establishment of a sheep and poultry farm.

This claim was disallowed on the grounds that the would-be vendors could only show good title o about an acre and a half of ground, but I believe that a high rate of mortality among the sheep and in epidemic which carried off some thousands of head of poultry had already decided the purchaser to abandon his courageous experiment.

Appeals.

12. It might have been anticipated that the early decisions of the Court resulting as they did in the lisallowal of a large percentage of claims to land frequently of considerable value would have resulted in a considerable number of Appeals to the Higher Courts. However, I find that, as a matter of fact, leave to appeal has been applied for in five cases only. In two instances the application has been subsequently withdrawn and in a third I understand that the parties intend to abandon the Appeal as soon as the delimitation of another claim in which they are interested has been satisfactorily arranged. In the remaining two claims the Appeal is still pending, but in neither of them has the Appellant taken any steps to have his case called on for final determination.

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13. In my Report for last year I suggested that the largest percentage of troublesome cases would be I in the land bordering on the harbour-the "New Kowloon" of Ordinance No. 30 of 1900. This ediction has proved substantially correct, not only, I believe, because of the enormous rise in the value ot such land since the Convention, but because it was so nearly worthless under Chinese Rule that per- sons entitled to the ownership, if indeed there were any such, took little or no trouble to assert those rights thereby laying the way open for the fabrication of every kind of fraudulent and fictitious claim by other persons later on.

I am glad to be able to report that the settlement of the eastern portion of New Kowloon is now almost complete.

Sam Shui Po and Lai Chi Kok.

For the western portion which ranges from Sam Shui Po to Kau P'a Kang on the north-east of Lai Chi Kok, regular sittings of the Full Court are now held four days in every week. I have no hesitation in pronouncing this to be by far the most difficult area in the New Territory; for the once deserted foreshore is now covered with a network of claims sometimes ten or twelve deep.

It became early apparent that a special map of these claims would be necessary, and in July, 1901, Ir. B. W. GREY was detailed for the survey work with Mr. A. J. MACKIE as his Demarcation Officer. Much delay was caused by the neglect of claimants to mark out their land with boundary stones when called upon; while frequently the boundary stones once planted have been torn up during the night by rival claimants or carried away by pilfering grass-cutters or marauding junk men. The survey of this district which is plotted on a scale of 32" is now nearly complete, having necessitated some seven months of regular work in the field. The total number of large claims thus specially surveyed is 122, ranging in extent from 190 acres to acre .033, while the total sum of their areas added together amounts to some 1,100 acres.

14. It is instructive to compare with this plentiful crop of litigation, the conditions prevailing in a rural area like the Island of Lan Tao where, out of a total of 9,853 holdings demarcated up to date, there have emerged only some four or five real disputes. It seems fairly clear that in the districts removed from the demoralising neighbourhood of the City of Victoria there should be little trouble in settling all suits between claimant and claimant. There remain certainly one or two vexed questions: for instance, we have yet to determine the exact status of tax lord " or rent charge owner ; and, again, we must look to experience to teach us the best method of dealing with family or "clan " estates where no partition Jas yet been effected; while again the exact proportion in which the dues of the Crown are to be paid

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