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hand over and relinquish possession to the Government under clause 31 of the Contract, and to incur no further expense under it.

That meanwhile the Government of British Guiana had asked that a legal opinion might be obtained as to whether the formal notice given by the Company on the 4th instant was in itself equivalent to a default under clause 31. That a telegram was accordingly sent by the Crown Agents to the Colonial Government warning them not to accept possession of the works pending the receipt of the legal opinion for which they had asked. That the Crown Agents subsequently addressed to you a further letter in which they suggested that the point raised by the British Guiana Government should be submitted to us, together with the further point as to the construction of clauses 30 and 31 of the Contract, upon which they were advised by their solicitors as mentioned above.

That Mr. Lucas was to add that it was desirable, if possible, that the Government should not be placed in the position of having to take over the works at the present time under clause 31 of the Contract, which, as would be observed, would involve the raising of the large sum of money required to recoup the Company for its capital expenditure under clause 27.

That Mr. Lucas was to request that we would take the papers into our consideration and favour you with our opinion upon the following points :-

(1.) Whether the Company's letter of the 4th instant constituted a default under the Contract, or whether no default in completion could occur until after the 22nd instant, the date to which the period was extended by Ordinance 16 of 1899 ?

(2.) Whether clause 31 of the Contract giving an alternative and additional power to the Government of taking over the works on default was to be regarded as subject to the power given them by clause 30, of determining the subsidy after the expiration of three months or longer notice; or

(3.) Whether power given to the Government by clause 31 must be exercised as soon as default had occurred on the part of the Company?

(4.) In the event of (2) being answered in the affirmative, whether clause 30 gave the Government the power of extending the time for the completion of the Contract, or whether such power would require to be ratified by a further Ordinance ?

(5.) Generally.

We have taken the matter into our consideration, and, in obedience to your commands, have the honour to

Report-

1. That the Company's letter of the 4th instant would constitute a default if the Government elected so to treat it, but not otherwise.

2 and 3. Clause 31 is subject to clause 30. Clause 31 does not compel the Government to take over the undertaking; it merely gives the Government the option of doing so.

The same rule of construction is applicable as in the case of a clause of forfeiture in a lease which, in spite of language apparently compulsory, is read as giving a power to the landlord to forfeit. Any other construction might be putting a premium on default. That the clause is optional is also clear from the fact that it is stated to be without prejudice to the other clauses of the Contract (e.g., clauses 8, 9, 37, besides 30). If clause 31 were compulsory it would supersede the other clauses.

Moreover, the Government are to take possession only upon payment; there is no provision that they are to pay.

4. Clause 30 relates merely to the suspension of the subsidy; to extend the time for completion an Ordinance would be wanted.

5. An endeavour should be made to come to reasonable terms for an extension of time and completion by the Company. If the Company refuse, the Government may, if it pleases, leave the undertaking on the hands of the Company.

The ligh

nourable Joseph Chamberlain,

&c.,

&c.

We have, &c.,

RICHARD E WEBSTER.

ROBERT B. FINLAY.

2252.

No. 7.

ж

(SOUTH AFRICA.)

LAW OFFICERS TO COLONIAL OFFICE.

Royal Courts of Justice,

January 18, 1900.

In obedience to your commands we have taken the matter into our consideration, and have the honour to-

Report—

That before any action is taken with regard to Captain Pache it will be necessary that the facts stated in M. de Watteville's letter of the 13th instant should he verified.

If it should be found that he holds a commission in the military service of the South African Republic, he might, in strictness, be detained as a prisoner of war:

but under the circumstances we very much doubt the propriety of adopting this

course,

AL

We are not yet in possession of the facts as to the existence of contraband of war on board the Bundesrath;" if there be no contraband goods, and no other persons in the military service of the Queen's enemies on board, we think that objection might very fairly be raised to the detention of Captain Pache as a prisoner of war, rlight, perhaps, not on strictly legal grounds. We suppose that it would never have been contemplated to bring in the "Bundesrath" merely on the ground of the presence on board of this one officer, in no very high position; and it might be open to remark if, having been brought within the power of Her Majesty's Government owing to the fact that the vessel has been brought in on suspicion of other contra- band which has not been verified, he were now to be detained.

In any case, nothing should be done till after further inquiry, except that possibly the Portuguese authorities at Delagoa Bay may prevent his going to the Transvaal until

he has established that he is not going to take part in the war.

The Rt. Hon. J. Chamberlain, M.P.,

&c.,

1630.

SIR,

&c.,

&c.

We have, &c.,

RICHARD E. WEBSTER. ROBERT B. FINLAY.

FOREIGN OFFICE to COLONIAL Office.

Foreign Office,

January 15, 1900.

I A3 directed by the Secretary of State for Foreign Affairs to transmit to you, to be laid before the Secretary of State for the Colonies, the accompanying copy of a letter reporting that a Captain Pache, a commission, is on board the Bundesrath,"

native of Switzerland, who holds a

I am, &c.,

DEAR SIR,

Enclosure.

Boer

FRANCIS BERTIE.

30, Welbeck Street, S.W.,

""

January 13, 1900. there is a person

Dr. A. DE WATTEVILLE to FOREIGN OFFICE.

I HAVE just ascertained that on board the Bundesrath the name of Pache, a native of Morges, in Switzerland, who has a commission of of Captain of Cavalry among the Boers.

feel bound to give you this information under the circumstances, as I know it is often difficult to bring home a charge of this sort against the guilty party.

4935-25-2,1900 Wt 439 D & S 5

ours, &c.,.

A. DE WATTEVILLE,

| PUBLIC RECORD OFFICE

19

Reference :-

C.O. 8

885

15 PUBLIC RECORD OFFICE, LONDON

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