In 1858, gold miners swarmed to the Fraser River. It was also the year that the longstanding Palmerston government was defeated and E. B. Lytton became the Colonial Secretary, responsible for overseeing the Hudson’s Bay Company.
In the past, there had been a push to settle Vancouver Island and the British Parliament had gone so far as to make it a colony, but the mainland was strictly under HBC’s monopoly. There were no settlers there and they liked it that way. As one member of parliament put it, “The Hudson’s Bay Company is by its very existence and its character the enemy of colonization” whose main purpose was to extract the resources of the land and not cater to the whims and needs of the populace.
Until 1858, the Hudson’s Bay Company had an ally in Parliament — the Colonial Secretary Henry Labouchere. That was about to change under Edward Bulwer Lytton.
The new Parliament made its mandate clear that it wanted to colonize the lands that the Hudson’s Bay Company possessed. The first step was to not renew their license which was slated for renewal May 30, 1859. In addition, the government aimed to bring into question the legality of the original Hudson’s Bay Company charter of 1670, this having been assigned to lands which were then under France’s control.
There was no instant communications in those days. It took many months for a ship to arrive with the mail and when it did reach the office of the Colonial Secretary, it took weeks on end for clerks to hand write copies for officials to read and comment on.
While he was waiting to receive an answer, Douglas made decisions as he saw fit. As the head of the HBC’s Columbia Department which oversaw New Caledonia, Douglas took it upon himself to establish mining fees and pricing controls. He also sought to uphold the Company’s monopoly and did his best to keep out the competition. To this end, he used the survey ships that were based in Esquimalt but most of the miners and merchants slipped in without notice.
E. B. Lytton soon made it clear that the Company’s monopoly only went so far as exclusive trading rights with the Indigenous people and that it could not be the sole provider of provisions, even though Douglas had pointed out all the efforts they had made to accommodate the gold seekers.
Lytton also organized a contingent of Royal Engineers to come to New Caledonia to help build roads and plan towns, to be paid from the colony’s revenue. The other bit of bad news for Douglas came when he received word that Lytton wished to have future administrative appointments come from ‘home’ rather than someone from the Company.
He chose Chartres Brew to be the head of the colony’s civilian police force and Matthew Begbie, a lawyer, was selected to be the judge.
On the day that Begbie was to sail from England, E.B. Lytton boarded the ship to personally hand over the documents to establish the new colony of British Columbia and the appointments of James Douglas as Governor, and Begbie as its Judge. Each document had been signed by Queen Victoria.
Begbie arrived at Esquimalt November 16, 1858. Three days later, on November 19, 1858 the swearing in ceremony and declaration of British Columbia took place at Fort Langley. This marked the end of the Hudson’s Bay Company’s control of New Caledonia.
The following year, Lord Palmerston’s government returned and Lytton was replaced by the Duke of Newcastle as Colonial Secretary.
Although the legality of HBC’s charter wasn’t settled for another 10 years, E. B. Lytton did succeed in terminating their monopoly of New Caledonia and establishing British Columbia.
Had Labouchere still been the Colonial Secretary when the gold rush broke out, things could have turned out much differently.