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PUBLIC RECORD OFFICE, LONDON

sum received by the Government being 47 dol. 65 c. Some free labour was employed in clearing jungle on the proposed line of railway, but the cost of this was only 92 dol. 92 c.

13. The total amount, therefore, expended by Mr. Lumsden on behalf of the proposed line of railway was less than 301., so that I do not think it was to this work that the Directors' complaint referred.

14. Governor Hennessy is mistaken in thinking that any part of the "permanent way" of the proposed railway was begun. Some jungle was cut on the intended line the per- manent way would take, and an accommodation path to reach the line was commenced but not finished. He is also mistaken in thinking that the work was stopped by the new manager. The work was begun in February and stopped in April, and Mr. Gray did not arrive till the end of June.

I have, &c. (Signed)

My Lord,

No. 3.

HENRY BULWER.

Governor Bulwer to the Earl of Kimberley.—(Received May 12.)

Government House, Labuan, March 31, 1873. WITH reference to the allusions made in the recent correspondence respecting the Oriental Coal Company's affairs, to a debt due by the Company to the Sultan of Brunei, I have read with surprise a statement made by Governor Hennessy that he had represented to me matter of this debt before his departure from Labuan.*

2. Governor Hennessy certainly left me no memorandum or note on the subject, and

I can only say that I have no recollection of any verbal representation of it, or even of any allusion to it, though I think in the case of a verbal representation of a matter requiring some action on my part I would most assuredly have myself made a note of it. Still, of course, I do not wish to oppose my non-recollection of a circumstance to a positive recol- lection of it by another.

3. Nor was there among the more recent correspondence with the Secretary of State, or in the Consular correspondence with the Foreign Office, any despatch touching on the subject which would serve to bring it to my notice.

4. The first intimation that, so far as I can recollect, I received on the subject was on the occasion of a visit I paid to the Sultan either in the month of March or of May last year. His Highness said the Company now owed him rent for a long time, and he hoped I would assist hin in obtaining a settlement of it. I did not at that time know anything of the arrears due by the former Company, and I concluded that the present Company had placed themselves, with regard to the Sultan, in the same position that they had placed themselves in with regard to the Crown, in their failure to pay their rental.

5. I told the Sultan that I was myself shortly expecting some communication from Her Majesty's Government on the subject of certain obligations of the Coal Company to the Government of Labuan; that I certainly would bear in mind what he had said to me as to the Company's obligations to him; and that I would not fail to represent any claim be might have, at the first convenient moment.

6. Your Lordship will remember that in the course of the year 1871 the Coal Company made an application to your Lordship for a remission or delay in the matter of their rental due to the Crown, and of this application I had been made aware before my departure from England.

7., I was, however, in the expectation to learn, by every mail, that the Company had increased their capital, and was enabled to pay the rental due to the Crown.

8. Not receiving any communication on the subject, I wrote to your Lordship about it on the 28th March; and I thought it better to defer bringing to the notice of Her Majesty's Government any further claims upon the Company till I should learn what arrangement had been made with respect to the rental due to the Crown.

9. When I was last in Brunei (October 1872), the Malay writer of the Consulate told me that the Sultan had spoken to him again about the rental due to His Highness by the Company,

10. I then told the Consulate writer that I had written to your Lordship about certain claims of the Government of Labuan (i.e., the Crown) on the Company, and that I was awaiting information from your Lordship, but that he might assure the Sultan I would not forget his request.

* l'ide page 48 of Confidential Paper, printed January 14, 1873.

11. On my return from Brunei, towards the latter end of October, I found Her Majesty's ship "Hornet" in harbour. She had brought a mail from Singapore; and among other despatches I found one acquainting me that, under the circumstances of pecuniary difficulty in which the Company were placed, your Lordship had consented to a postponement of payment of the rent due to the Crown.

12. It seemed to me useless, under those circumstances, to ask Her Majesty's Government at that time to urge upon the Company the payment of the rental due to the Sultan, and I therefore suffered it to stand over for a while.

13. It never occurred to me that there was likely to be any dispute by the Company as to their indebtedness for the rental, or that there was anything more than a postpone- ment of payment of the rental similar to the postponement of payment of the rental due to the Crown, in consequence of the very unfortunate circumstances into which the Company's affairs had lapsed.

14. It is with the greatest surprise and regret that I now perceive, in the Company's letter of the 20th December,* an apparent indication of an indisposition to recognize the claims of the Sultan upon them.

15. The question which thus becomes raised is one of great importance, and I am now engaged in an investigation into all the circumstances, the result of which I shall place fully before your Lordship and the Secretary of State for Foreign Affairs by an early opportunity.

I have, &c.

(Signed)

HENRY BULWER.

• Vide page 54 of Confidential Paper printed January 14, 1873.

PRINTED AT THE FOREIGN OFFICH BY T. KABRIBON.—30/5/73.

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11. On my return from Brunei, towards the latter end of October, I found Her Majesty's ship" Hornet "in harbour. She had brought a mail from Singapore; and among other despatches 1 found one acquainting me that, under the circumstances of pecuniary difficulty in which the Company were placed, your Lordship had consented to a postponement of payment of the rent due to the Crown.

13. It never occurred to me that there was likely to be any dispute by the Company as to their indebtedness for the rental, or that there was anything more than a postpone-

ment of payment of the rental similar to the postponement of payment of the rental due to the Crown, in consequence of the very unfortunate circumstances into which the Company's affairs had lapsed.

14. It is with the greatest surprise and regret that I now perceive, in the Company's letter of the 20th December, an apparent indication of an indisposition to recognize the claims of the Sultan upon them.

I have, &c. (Signed)

HENRY BULWER.

* Vide page 54 of Confidential Paper printed January 14, 1878,

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PRINTED AT THE FOREIGN OFFICH BY 1. HARRISON.—30/5/73,

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