CO885-(18-19) — Page 532

PUBLIC RECORD OFFICE

Reference :-

C.O.885

19 PUBLIC RECORD OFFICE, LONDON

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

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Mr. Chamberlain accordingly directed that the Colonial Government and the Crown Agents should be informed that he considered that the Crown Agents' Inspecting Engineer was very much to blame, but that the Colonial Engineer must also be held to be partly responsible for the loss.

In 1901 in connection with the rolling stock for the Jamaica Railway, the estimates for which were considerably excee:led by the Crown Agents without the authority of the Colonial Government or the Secretary of State, while the vehicles supplied were not what the Government wanted, Mr. Chamberlain said :-

The rule I desire to lay down as regards 3351/01. Crown Agents in fature is, that where a mistake Jea. of theirs has caused direct pecuniary loss to any Colony and where such Colony would have a legal and sustainable claim if the Crown Agents were private merchants, such claim shall be dealt with by fair compensation. The justice of the claim and the amount of compensation, if any, will have to be decided by arbitrator appointed by me if it is disputed."

The following is an extract from the despatch which Mr. Chamberlain accordingly addressed to the Governor of Jamaica :-

"In

Mr. Olivier's despatch

he S. of S. 24

suggests that the Crown Agents' funds should be 5 Mar. 01, surcharged with the additional expense thrown

3351/01 upon the Colonial Government through their Jea. mistake. Such a step would, as both he and yourself are aware, constitute an entirely new departure in the relations between the Colonies and the Crown Agents. I am inclined to rule that in cases in which a Colony suffers direct loss owing to mistakes by the Crown Agents-- mistakes I may add which must occasionally occur in every large business-such sation as might be obtained by legal process from a private firm of merchants should be paid by the Crown Agents to the Colony concerned, but I must point out that this new decision will involve consequences for which the Colonial Governments must be prepared."

compen-

"The Crown Agents inform me that for some years their ordinary Agency business has been carried on at a loss (the Jamaica business being particularly unremunerative) ..

The equi-

librium between revenue and expenditure has, in fact, only been maintained by the means of the interest on their accumulated funds. This state of things is not business like, and it is obvious. that the charges made must be such as to cover the whole cost of the services including an insurance against the liability which may in future be cast upon them."

Eventually, on Mr. Chamberlain's instructions, the Crown Agents in 1901-02 made good to the Jamaica Government out of the funds of the

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office a sum of £640 expended in excess of the approved estimate on two passenger carriages and some freight cars, and in his confidential circular despatch to the Crown Colonies dated 25th August, 1903, in which the Secretary of State dealt with the reports as to the working of the Crown Agents, which as a result of the Jamaica Railway case he had called for from all the Governments served by them, Mr. Chamber- lain said :-

Next comes the point raised in Sir H. Goold Adams's despatch that the Colonies have

no power of imposing any penalty upon the Crown Agents for any mistake or negligence on their part in the ordering or despatch of goods.' It might be argued that through the Secretary of State they have the power of doing so, and I have recently exercised the power, when I thought it should be exercised, on behalf of the Government of Jamaica. But what seems to be contemplated is that the Colonial Governments should themselves have the power to penalise and exact compensation from the Crown Agents for any serious laches, without requiring the Secretary of State's authority.

"The Crown Agents state in their letter of 30th July, 1902, that they are quite prepared to accept the principle of making compensation for such mistakes in all cases where ordinary agents would be legally liable'; but if this principle was to be fully carried into practice, it might be necessary to revise the terms on which the business is now transacted.

"Subject to this possibility, I am prepared to receive from the Colonial Governments parti- culars of any case in which they consider that the interests of their respective Colonies have seriously suffered at the hands of the Crown Agents, and to decide whether, and if so, what compensation shall be paid by the Crown Agents in such cases, but it should be borne in mind that, if a question can be satisfactorily settled by direct correspondence with the Crown Agents, there is no need to invite the intervention of the Secretary of State, and that before a Governor does communicate with the Secretary of State, he should examine the facts himself, and satisfy himself that such a reference is required. make this observation because cases have occurred in which complaints have been ad- dressed to me, which a little examination would have shown to have little or no foundation, and appeals to the Secretary of State in such cases tend to interrupt the good feeling which should exist between the Crown Agents and their principals."

It may be pointed out, however, that to order the Crown Agents to compensate a Colony from their Office Funds is in no way a pecuniary penalty on the Crown Agents-it practically ineans that all the Colonies are fined to reimburse

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one Colony for the loss caused by the mistake of the Crown Agents; for the Office Funds really belong, not to the Crown Agents, but to the Colonial Governments by whose contributions they are kept up, and who will have to make up any deficiency by means of increased contribu-

tions.

Gold Coast.

The Crown Agents occasionally fine their eg Inspecting Officers for passing unsatisfactory 10822 00. work or otherwise failing to secure compliance with the terms of an order. The fine usually, I gather, takes the form of stopping the whole or part of their Inspection Fees for the work in question.

A. J. H.

April 8th, 1908.

aring