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PUBLIC RECORD OFFICE

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PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

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102

No. 85.

HONG KONG.

THE SECRETARY OF STATE to THE GOVERNOR.

(Sent 3.50 p.m., 22nd March, 1917.)

TELEGRAM.

YOUR telegram 10th March,* sale of enemy properties. Proposals approved with much reluctance and only in deference to your representations. Great care must be exercised in regard to foreign purchasers.-LONG.

22157

SIR,

No. 86.

CEYLON.

THE GOVERNOR to THE SECRETARY OF STATE. (Received 30th April, 1917.)

[Copy to India Office and Foreign Office, 23rd May, 1917. L.F.]

(Confidential.)

[Answered by No. 89.]

The Queen's House, Colombo, Ceylon, 31st March, 1917. WITH reference to your Confidential despatch of the 29th January, 1917,† on the subject of the liquidation of the business of Messrs. Freudenberg & Com- pany, I have the honour to transmit, for your information, the accompanying copy of a letter, dated 19th March, which has been received from the Custodian of Enemy Property, and to request that you will be so good as to agree to an extension of time being given up to the 31st October, 1917, if necessary, to Mrs. Mary de Silva and Mr. Philip de Silva to settle their debts to the company.

2, I also enclose a copy of a joint report drawn up by the Custodian of Enemy Property and Mr. Schneider, at present acting as Attorney-General, as to the measures which are necessary in order to settle all outstanding matters with regard to enemy property in Ceylon, including the property of Messrs. Freudenberg. propose to take action in the matter as advised by Mr. Pagden and Mr. Schneider.

I have, &c.,

R. E. STUBBS,

Colonial Secretary,

(No. 21.)

Enclosure 1 in No. 86.

for Governor, etc.

Office of the Controller of Revenue, 19th March, 1917. Mrs. Mary de Silva's and Mr. Philip de Silva's debts to Freudenberg & Company. SIR,

WITH reference to your letter of 1st March, 1917, I have the honour to forward copy of a letter of 2nd-3rd March, 1917, addressed by me to the liquidators and of their reply of 17th March, 1917.

over which the 2. It would appear from this reply that circumstances liquidators can have no control have arisen which may further delay the final settlement of the de Silvas' debts.

3. I consider, therefore, that it would be advisable to apply to the Secretary of State for the extension asked for by the liquidators.

4. This is merely a matter of precaution, as the de Silvas are still under the belief that they must finally settle their debts by 31st July, and even if the extension were granted it is still open to declare the liquidation to be otherwise completed by 31st July or even an earlier date.

The Honourable

The Colonial Secretary.

I am, &c.,

A. S. PAGDEN, Custodian of Enemy Property.

(No. 225.)

103

Office of the Controller of Revenue, 3rd March, 1917. Mrs. Mary de Silva's and Mr. Philip de Silva's debts to Freudenberg & Company. GENTLEMEN,

WITH reference to my letter No. 250, of 11th December, 1916, and subsequent correspondence, I have the honour to inform you that every effort should be made to complete the settlement of the debts of Mrs. Mary de Silva and Mr. Philip de Silva and dispose finally of the business of Messrs. Freudenberg & Company at the earliest possible date.

2. Instructions have been received that no extension of time beyond 31st July next should be allowed to the de Silvas without reference to the Secretary of State in the matter.

8. Should such extension become necessary application should be made in sufficient time to enable the orders of the Secretary of State to be obtained before 31st July. Any such extension is strongly to be deprecated, and I shall be obliged if you will inform me whether there is a good prospect of the debts being finally settled at an earlier date.

Messrs. Ford, Rhodes, Thornton, & Company,

SIR,

Colombo.

I am, &c.,

A. S. PAGDEN, Custodian of Enemy Property.

Colombo, 17th March, 1917.

Philip de Silva-Plumbago Scheme.

WITH reference to your letter No. 225, of the 2nd-3rd instant, we have gone into this matter with Messrs. F. J. & G. de Saram and the de Silvas, and beg to report as follows:-

In the ordinary course there appears to have been little doubt that the de Silvas would have been in a position to settle the claim of Messrs. Freudenberg & Company, amounting to eight lacs, by the 31st July next.

Unforeseen circumstances have thereafter arisen which make this payment extremely difficult before that date, the first being the present financial crisie, owing to which the de Silvas were unable to sell during January, and a part of Arrangements February, any of their ordinary grades of plumbago for cash. have, however, since been made by which they are able now to sell these grades for payment in London.

The second and more serious difficulty has been the trouble which the de Silvas have had with the Madapola Company, Limited, who have started tunnelling in the Dumbara pits and, besides damaging the pits, have removed large quantities of plumbago. The opinions of Advocate B. W. Bawa, K.C., Allan Drieberg, and E. J. Samarawickreme have been taken in the matter, and although they are of opinion that the de Silvaa have an action for the damage done to the pits, they found some difficulty in expressing a definite opinion regarding the right of the Madapola Company to prospect for plumbago. There is no doubt that the inten- tion of the lessors of the Madapola Company was to give them the right of making an adit only across the land, but certain technical words have been imported into the deed which makes it difficult to construe the deed with any degree of certainty. The institution of an action would have meant a lengthy and protracted trial, and the de Silvas decided on assigning their leasehold interest to one, Mr. Daundeskere, who is an influential man and is resident at the spot, and who will, we think, be able to come to some amicable arrangement with the Madapola Company. The de Silvas will then receive a one-third share of the output without any expenditure on the pits, which has been considerable.

The output of the Dumbara pits was on the average about one hundred and twenty-seven tons a month, and it was this plumbago which was chiefly cured and supplied to the Morgan Crucible Company, Limited.

It will thus be seen that the de Silvas have lost one of their chief sources of

revenue.

We think it, therefore, desirable that an extension of about three months should be obtained from the Secretary of State for the Colonies as a matter of precaution.

* No. 84.

+ No. 82.