Sec. 12/46.
No. 195
GOVERNMENT HOUSE
HONG KONG.
17 November 1949.
14 3.
Enclosures 1
Enclosure No. 10
9
Sir,
I have the honour to forward, for your consideration, copies of correspondence which has passed between the Accountant General and various branches of His Majesty's Dockyard, Hong Kong, on the subject of flour requisitioned at the instance of the Royal Naval authorities in December 1941, and to request your assistance in obtaining an early settlement of this claim.
2.
The facts of this case are that a large quantity of flour was requisitioned by this Government for various purposes on the 9th and 10th of December, 1941, and that this included 7,255 sacks requisitioned on behalf of the Commodore, Hong Kong, and held to the order of the Naval authorities. There is evidence that 4,400 sacks of flour passed into the physical control of the Naval authorities by the delivery to them of a godown warrant for this amount, but no evidence to show whether the balance of 2,855 sacks ever passed into Naval control.
3.
In the circumstances obtaining during the hostilities, it was not to be expected that the complicated procedure laid down by the Compensation (Defence) Regulations could be completed in respect of this large requisition, and settlement was not made until the 15th June, 1946, by which time under the above-mentioned Regulations a certain sum had accrued on account of interest.
4.
It will be seen from the letter dated 14th July, 1949, from the Superintendent of His Majesty's Victualling Yard, that the Naval authorities now seek to repudiate their liability for this requisition, with the exception of the small amount which was actually received in Royal Naval depots and at the bakery.
5.
I regard with grave concern the contention of the Naval authorities that they are not liable to indemnify this Government for compensation paid out in respect of a requisition made at their request. Such a repudiation would have the effect of undermining the whole basis on which supplies are requisitioned for the Armed forces in emergency, and would compel this Government to consider very carefully the matter
I attach here to an opinion of future requisitions. written by the Solicitor General to the effect that legal liability appears to rest with the Naval author- ities to indemnify this Government in respect of the whole amount of 7,255 sacks.
THE RIGHT HONOURABLE
ARTHUR CREECH JONES, M.P.