CO129-606-5 Hong Kong Loan- Financial settlement 2-3-1948 - 4-10-1948 — Page 151

Cypher (0.T.P.)

INWARD TELEGRAM

TO THE SECRETARY OF STATE FOR THE COLONIES

@ REG'

FROM HONG KONG (Sir A. Grantham)

D. 1st May, 1948. #7 R. 1st.

-11,40 hrs.

150

51

AULO

(2.9) an 55178/19/47

9 Burma

IMMEDIATE No.437. Secret.

10%

EGY.

54126/16/18

(48) Your telegram No. 499-

War expenditure settlementa.

As a result of legal opinion enclosed with your savingram No.70 26th August, 1947, based on legislation in Nicobar Talanda) I was under the impression that it might be necessary to admit legal liability here in respect of all denial measures carried out while Civil Government was still

in control. I infer from your telegrams Nos. 498 and 499 (47) (1 that (? we) proceed on the assumption that legal liability will arise only in respect of requisitioned vessels.

2.

Apart from some requisitioned by the Navy in 1939, over which there should be (7 no omitted) difficulty, requisitioning and scuttling of vissels was carried out in accordance with pre-determined defence plan which at the instance of Naval Authorities provided for certain denial measures and for ertain duties in connection (? therewith) to be delegated to Harbour Master. In accordance with usual practice, all requisitioning was carried out by CiVAL Controller of Water Transport who acted as required at the behest of both car al and Military authorities.

3.

Following were requisitioned

-

(a) five piver steamers earmarked for use as boom dafones vosscle and block ships at naval dockyard (Aberdeen).

(b) Four river steamers for has as block shipe

at the entrance of Yaumati dockyard.

(c) Four additional piver steamora for emergency defence purposes es required which were anchoreŭ in Kowloon Bay and sunk by guafire order of the military authorities to deny their use to the Japan(66.

(d) Ferry fleets of Yaumet) and Star Ferry Companies matbly to facilitate the avacuation of the military forces from the meinland.

(s) Approximately 50 launches for use (7 in the present circumstances) by naval and military authorities in moving stores and personnel.

In addition a number of reagoing vessels small coasters and Chinese river steamers which were in the harbour at the time of evacuation of the mainland and which had not been requisitionsă, vere scuttled in accordance with instructions in defence plan that their use should be denied

to the enemy -- In other cases engines were damaged but

( Group omitted) was carried out

Vessels were not a ink.

/by

J