CO882-(2-3) — Page 66

PUBLIC RECORD OFFICE

C.O.

Reference -

·882

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH—NOT TO

2 PUBLIC RECORD OFFICE, LONDON

Sir,

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No. 13.

Sir Clinton Murdoch to Mr. Herbert.—(Received June 17.)

Emigration Board, June 15, 1873.

I HAVE to acknowledge your letter of 12th instant, with one from Mr. McLagan, M.P., and a despatch from the Governor of Labuan on the subject of the non-payment of the rent due by the Oriental Coal Company.

2. Upon this I have only to observe that no less than four letters had been written by us, under direction of the Secretary of State, calling for payment of the rent, to which we could get no answer of any kind; and that the Company had no reason to expect any communication from us on the subject of police and convict labour charges, as we have had no correspondence with them on those subjects. The question of pressing the Company for payment of their rent has now become a question of policy on which it would not become us to offer any opinion.

I have, &c.

My Lord,

No. 14.

(Signed)

T. W. C. MURDOCH.

Mr. Lindsay to the Earl of Kimberley.—(Received July 29.)

London, July 27, 1872. WITH reference to the interview which a deputation on behalf of the Oriental Coal Company Limited, the deputation consisting of myself one of the Directors of the Company, and of Peter McLagan, Esquire, M.P., and William Miller, Esquire, of Manderston, two of the shareholders of the Company, had with your Lordship on the 25th July current, in reference to the Crown's demand for payment of 1,0001. of rent for the Labuan mines iet on lease to the above Company, I beg, on behalf of the Company, as suggested by your Lordship, to put in writing the substance of the verbal statement I made to your Lordship at the above interview.

In the first place it appears necessary to ascertain precisely what the Crown's demand is.

If the contract of lease be referred to it will be seen that a royalty was payable up to December 1870, and that thereafter 1,0007, of annual rent was to accrue, and it is expressly provided "that the said rent of 1,0001. shall be paid . . by two equal half- yearly payments on the 24th day of June, and the 25th day of December in every year, the 1st of such half-yearly payments to be made on the 24th of June, 1871."

Besides this money, in name of rent, the contract of lease imposed upon the Company a variety of obligations, all which it is right to keep in mind have been fully and faithfully implemented by the Company as tenants of the mines, including in these obligations the payment of the royalty up to the date when the money-rent commenced to run.

The most important of these other obligatious was to supply and provide, and also keep in good order and repair, an adequate supply of suitable lighters for the purpose of coaling any ships of Her Majesty navy or under charter to any Department of Her Majesty's Government, which coal was to be paid for at 11. per ton free on board any and every such vessel or ship which may be lying alongside of any wharf or jetty erected, or to be erected, in the island, but if the said vessel or ship shall not be lying alongside of any such wharf or jetty then free on board of proper lighters to be supplied as aforesaid.

It is especially declared by the contract that the Governor shall determine what shall be the reasonable rate of charge (having regard to the capital invested in and the wear and tear of such lighters, but exclusive of any question of profit) to be paid to the said Company for the use of such lighters.

Now, up to the date of the last advises the quantity of coals delivered to Her Majesty's navy was 4,712 tons. For this there was paid 17. per ton. For the information of your Lordship it is proper to state that other parties, the general public, on an average, paid 1. 7. 1d. per ton, the last and greater quantity having been sold at 17. 11. 10d. per ton.

Coals in China have lately risen in price, and coals in this country have risen fifty per cent. of late, and are still rising in fact, coals can scarcely be got for export.

In consideration of the obligations imposed on the Company there are certain

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privileges which were conferred on the Company in order to the proper and profitable working of the mines.

The most important of these privileges was that the Company had a right to acquire surface land at a price of 11. per acre, the quantity however not to exceed 1,000 acres.

The Company have also the privilege to occupy rent free any land required for the construction of roads, railroads, or tramways necessary for, or connected with, the working or carrying on of the said coal mines and premises or any of them; and to occupy at a rent to be fixed by the Governor any land required for the construction of wharves, quays, or jetties, for the loading or unloading of vessels or the loading or shipment of coal, the water frontage not to exceed 500 yards.

New, the late Governor Pope Hennessy exacted as rent for a single jetty the sum of 100%. yearly, and this rent he made payable in advance. By the contract of lease the Company had a right to purchase, with consent of the Crown, any land abutting on the seashore or on any harbour or creek, for all or any of the purposes of the Company at 17. per acre.

The Company's late manager at the mines was not attentive to the Company's interests in regard to these extra matters, including a variety of other payments which the late Governor Hennessy exacted from him. The Directors of the Company, therefore, are under the necessity of bringing these exactions under the notice of the Secretary of State for the Colonies in the perfect confidence that he will give redress, and put the above jetty rent, and all other money payments to be made by the Company to the Crown on a fair and equitable and just footing.

The Directors of the Company submit that the rent of the single jetty should not exceed a nominal sum of one shilling yearly.

The Directors of the Company have also to state that they believe nothing has hitherto been fixed by the Crown for the use of the Company's lighters in loading the above quantity of 4,712 tons of coal put on board Her Majesty ships. The Directors, therefore, beg that this matter may be inquired into by the Colonial Office, and that whatever is due to the Company in respect to it be fixed by the Governor and credited to the Company in stating the claim for rent.

During a storm at the island the Company's lighters suffered damage and loss, and the Company were obliged very recently, to purchase and send to Labuan two additional lighters.

But what the Directors have to represent to the Colonial Government is the fact that the late Governor Hennessy, during his stay at Labuan, acted towards the Company in a manner calculated unjustly and injuriously to affect its pecuniary interests. He also represented to the Directors or others connected with the Company that the Company's late manager at Labuan was a first-rate manager, and "exactly the man for the place," and that he was "making a large profit for his employers every month," while the facts. were that the mines were mismanaged, so much so that the whole available capital of the Company, upwards of 40,0001. was lost; and the Directors were obliged to recall their late manager and discharge him as not worthy of their confidence. The Company have very lately been obliged to issue preferential stock to bear interest at 25 per cent. per annum.

Of this new stock a sum remains of 9,000l., but there are already sums due -besides the Crown rent-of about 2,000. It is therefore the object and interest of the Company to husband this fund as much as possible to complete the new pit, which, it is expected, will make the Company a very profitable concern.

The Company specially object to a charge for police, which the late Governor cxacted without lawful or constitutional authority, and which the late manager of the Company at the mines had no power under the lease or otherwise to agree to. Under this head no less an amount than 7851. 15s. 4d. has been exacted from the Company.

On the 9th February, 1871, the Directors wrote to the late manager on this head as follows:-"The Directors observe you have paid a very large sum of money for the first time in the history of the Colony for Police, and without having informed the Company here or obtaining their consent to any such payment. The Directors decline to confirm this payment, and will not pass it.

The Company also specially object to the extravagant charges made on the Company for hospital. On this head there has been paid 5791. 78. 6d. The present Governor (Bulwer) has reduced the charge on this head, and if the charge had been made at the reduced rate, all along, the sum paid by the Company would have been 9807. 17s. Gd., 80 that, if legal and payable at all, there has been an overcharge of 2021, 10s.

The Directors take this opportunity to call for an explanation of the rates charged the Company for convict labour, on which account the Company have been charged and paid at Labuan to date, 2,4801. The Directors think that the rates charged are much too

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