The Remarkable History of the Hudson's Bay Company

CHAPTER II
HUDSON'S BAY COMPANY FOUNDED

Royal charters – Good Queen Bess – "So miserable a wilderness" – Courtly stockholders – Correct spelling – "The nonsense of the Charters" – Mighty rivers – Lords of the territory – To execute justice – War on infidels – Power to seize – "Skin for skin" – Friends of the red man.

The success of the first voyage made by the London merchants to Hudson Bay was so marked that the way was open for establishing the Company and carrying on a promising trade. The merchants who had given their names or credit for Gillam's expedition lost no time in applying, with their patron, Prince Rupert, at their head, to King Charles II. for a Charter to enable them more safely to carry out their plans. Their application was, after some delay, granted on May 2nd, 1670.

The modern method of obtaining privileges such as they sought would have been by an application to Parliament; but the seventeenth century was the era of Royal Charters. Much was said in England eighty years after the giving of this Charter, and again in Canada forty years ago, against the illegality and unwisdom of such Royal Charters as the one granted to the Hudson's Bay Company. These criticisms, while perhaps just, scarcely cover the ground in question.

As to the abstract point of the granting of Royal Charters, there would probably be no two opinions to-day, but it was conceded to be a royal prerogative two centuries ago, although the famous scene cannot be forgotten where Queen Elizabeth, in allowing many monopolies which she had granted to be repealed, said in answer to the Address from the House of Commons: "Never since I was a queen did I put my pen to any grant but upon pretext and semblance made to me that it was both good and beneficial to the subject in general, though private profit to some of my ancient servants who had deserved well… Never thought was cherished in my heart that tended not to my people's good."

The words, however, of the Imperial Attorney-General and Solicitor-General, Messrs. Bethel and Keating, of Lincoln's Inn, when appealed to by the British Parliament, are very wise: "The questions of the validity and construction of the Hudson's Bay Company Charter cannot be considered apart from the enjoyment that has been had under it during nearly two centuries, and the recognition made of the rights of the Company in various acts, both of the Government and Legislature."

The bestowal of such great privileges as those given to the Hudson's Bay Company are easily accounted for in the prevailing idea as to the royal prerogative, the strong influence at Court in favour of the applicants for the Charter, and, it may be said, in such opinions as that expressed forty years after by Oldmixon: "There being no towns or plantations in this country (Rupert's Land), but two or three forts to defend the factories, we thought we were at liberty to place it in our book where we pleased, and were loth to let our history open with the description of so wretched a Colony. For as rich as the trade to those parts has been or may be, the way of living is such that we cannot reckon any man happy whose lot is cast upon this Bay."

The Charter certainly opens with a breath of unrestrained heartiness on the part of the good-natured King Charles. First on the list of recipients is "our dear entirely beloved Prince Rupert, Count Palatine of the Rhine, Duke of Bavaria and Cumberland, etc," who seems to have taken the King captive, as if by one of his old charges when he gained the name of the fiery Rupert of Edgehill. Though the stock book of the Company has the entry made in favour of Christopher, Duke of Albemarle, yet the Charter contains that of the famous General Monk, who, as "Old George," stood his ground in London during the year of the plague and kept order in the terror-stricken city. The explanation of the occurrence of the two names is found in the fact that the father died in the year of the granting of the Charter. The reason for the appearance of the name of Sir Philip Carteret in the Charter is not so evident, for not only was Sir George Carteret one of the promoters of the Company, but his name occurs as one of the Court of Adventurers in the year after the granting of the Charter. John Portman, citizen and goldsmith of London, is the only member named who is neither nobleman, knight, nor esquire, but he would seem to have been very useful to the Company as a man of means.

The Charter states that the eighteen incorporators named deserve the privileges granted because they "have at their own great cost and charges undertaken an expedition for Hudson Bay, in the north-west parts of America, for a discovery of a new passage into the South Sea, and for the finding of some trade for furs, minerals, and other considerable commodities, and by such their undertakings, have already made such discoveries as to encourage them to proceed farther in pursuance of their said design, by means whereof there may probably arise great advantage to Us and our kingdoms."

The full name of the Company given in the Charter is, "The Governor and Company of Adventurers of England, trading into Hudson Bay." They have usually been called "The Hudson's Bay Company," the form of the possessive case being kept in the name, though it is usual to speak of the bay itself as Hudson Bay. The adventurers are given the powers of possession, succession, and the legal rights and responsibilities usually bestowed in incorporation, with the power of adopting a seal or changing the same at their "will and pleasure"; and this is granted in the elaborate phraseology found in documents of that period. Full provision is made in the Charter for the election of Governor, Deputy-Governor, and the Managing Committee of seven. It is interesting to notice during the long career of the Company how the simple machinery thus provided was adapted, without amendment, in carrying out the immense projects of the Company during the two and a quarter centuries of its existence.

The grant was certainly sufficiently comprehensive. The opponents of the Company in later days mentioned that King Charles gave away in his sweeping phrase a vast territory of which he had no conception, and that it was impossible to transfer property which could not be described. In the case of the English Colonies along the Atlantic coast it was held by the holders of the charters that the frontage of the seaboard carried with it the strip of land all the way across the continent. It will be remembered how, in the settlement with the Commissioners after the American Revolution, Lord Shelburne spoke of this theory as the "nonsense of the charters." The Hudson's Bay Company was always very successful in the maintenance of its claim to the full privileges of the Charter, and until the time of the surrender of its territory to Canada kept firm possession of the country from the shore of Hudson Bay even to the Rocky Mountains.

The generous monarch gave the Company "the whole trade of all those seas, streights, and bays, rivers, lakes, creeks, and sounds, in whatsoever latitude they shall be, that lie within the entrance of the streights commonly called Hudson's Streights, together with all the lands, countries, and territories upon the coasts and confines of the seas, streights, bays, lakes, rivers, creeks, and sounds aforesaid, which are not now actually possessed by any of our subjects, or by the subjects of any other Christian prince or State."

The wonderful water system by which this great claim was extended over so vast a portion of the American continent has been often described. The streams running from near the shore of Lake Superior find their way by Rainy Lake, Lake of the Woods, and Lake Winnipeg, then by the River Nelson, to Hudson Bay. Into Lake Winnipeg, which acts as a collecting basin for the interior, also run the Red River and mighty Saskatchewan, the latter in some ways rivalling the Mississippi, and springing from the very heart of the Rocky Mountains. The territory thus drained was all legitimately covered by the language of the Charter. The tenacious hold of its vast domain enabled the Company to secure in later years leases of territory lying beyond it on the Arctic and Pacific slopes. In the grant thus given perhaps the most troublesome feature was the exclusion, even from the territory granted, of the portion "possessed by the subjects of any other Christian prince or State." We shall see afterwards that within less than twenty years claims were made by the French of a portion of the country on the south side of the Bay; and also a most strenuous contention was put forth at a later date for the French explorers, as having first entered in the territory lying in the basin of the Red and Saskatchewan Rivers. This claim, indeed, was advanced less than fifty years ago by Canada as the possessor of the rights once maintained by French Canada.

The grant in general included the trade of the country, but is made more specific in one of the articles of the Charter, in that "the fisheries within Hudson's Streights, the minerals, including gold, silver, gems, and precious stones, shall be possessed by the Company." It is interesting to note that the country thus vaguely described is recognized as one of the English "Plantations or Colonies in America," and is called, in compliment to the popular Prince, "Rupert's Land."

Perhaps the most astounding gift bestowed by the Charter is not that of the trade, or what might be called, in the phrase of the old Roman law, the "usufruct," but the transfer of the vast territory, possibly more than one quarter or a third of the whole of North America, to hold it "in free and common socage," i.e., as absolute proprietors. The value of this concession was tested in the early years of this century, when the Hudson's Bay Company sold to the Earl of Selkirk a portion of the territory greater in area than the whole of England and Scotland; and in this the Company was supported by the highest legal authorities in England.

To the minds of some, even more remarkable than the transfer of the ownership of so large a territory was the conferring upon the Company by the Crown of the power to make laws, not only for their own forts and plantations, with all their officers and servants, but having force over all persons upon the lands ceded to them so absolutely.

The authority to administer justice is also given in no uncertain terms. The officers of the Company "may have power to judge all persons belonging to the said Governor and Company, or that shall live under them, in all causes, whether civil or criminal, according to the laws of this kingdom, and execute justice accordingly." To this was also added the power of sending those charged with offences to England to be tried and punished. The authorities, in the course of time, availed themselves of this right. We shall see in the history of the Red River Settlement, in the very heart of Rupert's Land, the spectacle of a community of several thousands of people within a circle having a radius of fifty miles ruled by Hudson's Bay Company authority, with the customs duties collected, certain municipal institutions established, and justice administered, and the people for two generations not possessed of representative institutions.

One of the powers most jealously guarded by all governments is the control of military expeditions. There is a settled unwillingness to allow private individuals to direct or influence them. No qualms of this sort seem to have been in the royal mind over this matter in connection with the Hudson's Bay Company. The Company is fully empowered in the Charter to send ships of war, men, or ammunition into their plantations, allowed to choose and appoint commanders and officers, and even to issue them their commissions.

There is a ludicrous ring about the words empowering the Company to make peace or war with any prince or people whatsoever that are not Christians, and to be permitted for this end to build all necessary castles and fortifications. It seems to have the spirit of the old formula leaving Jews, Turks, and Saracens to the uncovenanted mercies rather than to breathe the nobler principles of a Christian land. Surely, seldom before or since has a Company gone forth thus armed cap-à-pie to win glory and profit for their country.

An important proviso of the Charter, which was largely a logical sequence of the power given to possess the wide territory, was the grant of the "whole, entire, and only Liberty of Trade and Traffick." The claim of a complete monopoly of trade was held most strenuously by the Company from the very beginning. The early history of the Company abounds with accounts of the steps taken to prevent the incoming of interlopers. These were private traders, some from the English colonies in America, and others from England, who fitted out expeditions to trade upon the Bay. Full power was given by the Charter "to seize upon the persons of all such English or any other subjects, which sail into Hudson's Bay or inhabit in any of the countries, islands, or territories granted to the said Governor and Company, without their leave and license in that behalf first had and obtained."

The abstract question of whether such monopoly may rightly be granted by a free government is a difficult one, and is variously decided by different authorities. The "free trader" was certainly a person greatly disliked in the early days of the Company. Frequent allusions are made in the minutes of the Company, during the first fifty years of its existence, to the arrest and punishment of servants or employés of the Company who secreted valuable furs on their homeward voyage for the purpose of disposing of them. As late as half a century ago, in the more settled parts of Rupert's Land, on the advice of a judge who had a high sense of its prerogative, an attempt was made by the Company to prevent private trading in furs. Very serious local disturbances took place in the Red River Settlement at that time, but wiser counsels prevailed, and in the later years of the Company's régime the imperative character of the right was largely relaxed.

The Charter fittingly closes with a commendation of the Company by the King to the good offices of all admirals, justices, mayors, sheriffs, and other officers of the Crown, enjoining them to give aid, favour, help, and assistance.

With such extensive powers, the wonder is that the Company bears, on the whole, after its long career over such an extended area of operations, and among savage and border people unaccustomed to the restraints of law, so honourable a record. Being governed by men of high standing, many of them closely associated with the operations of government at home, it is very easy to trace how, as "freedom broadened slowly down" from Charles II. to the present time, the method of dealing with subjects and subordinates became more and more gentle and considerate. As one reads the minutes of the Company in the Hudson's Bay House for the first quarter of a century of its history, the tyrannical spirit, even so far at the removal of troublesome or unpopular members of the Committee and the treatment of rivals, is very evident.

This intolerance was of the spirit of the age. In the Restora tion, the Revolution, and the trials of prisoners after rebellion, men were accustomed to the exercise of the severest penalties for the crimes committed. As the spirit of more gentle administration of law found its way into more peaceful times the Company modified its policy.

The Hudson's Bay Company was, it is true, a keen trader, as the motto, "Pro Pelle Cutem" – "skin for skin" – clearly implies. With this no fault can be found, the more that its methods were nearly all honourable British methods. It never forgot the flag that floated over it. One of the greatest testimonies in its favour was that, when two centuries after its organization it gave up, except as a purely trading company, its power to Canada, yet its authority over the wide-spread Indian population of Rupert's Land was so great, that it was asked by the Canadian Government to retain one-twentieth of the land of that wide domain as a guarantee of its assistance in transferring power from the old to the new régime.

The Indian had in every part of Rupert's Land absolute trust in the good faith of the Company. To have been the possessor of such absolute powers as those given by the Charter; to have on the whole "borne their faculties so meek"; to have been able to carry on government and trade so long and so successfully, is not so much a commendation of the royal donor of the Charter as it is of the clemency and general fairness of the administration, which entitled it not only officially but also really, to the title "The Honourable Hudson's Bay Company."

CHAPTER III
METHODS OF TRADE

Rich Mr. Portman – Good ship Prince Rupert– The early adventurers – "Book of Common Prayer" – Five forts – Voting a funeral – Worth of a beaver – To Hudson Bay and back – Selling the pelts – Bottles of sack – Fat dividends – "Victorious as Cæsar" – "Golden Fruit."

The generation that lived between the founding of the Company and the end of the century saw a great development in the trade of the infant enterprise. Meeting sometimes at the place of business of one of the Committee, and afterwards at hired premises, the energetic members of the sub-committee paid close attention to their work. Sir John Robinson, Sir John Kirke, and Mr. Portman acted as one such executive, and the monthly, and at times weekly meetings of the Court of Adventurers were held when they were needed. It brings the past very close to us as we read the minutes, still preserved in the Hudson's Bay House, Leadenhall Street, London, of a meeting at Whitehall in 1671, with His Highness Prince Rupert in the chair, and find the sub-committee appointed to carry on the business. Captain Gillam for a number of years remained in the service of the Company as a trusted captain, and commanded the ship Prince Rupert. Another vessel, the Windingoo, or Wyvenhoe Pinck, was soon added, also in time the Moosongee Dogger, then the Shaftsbury, the Albemarle, and the Craven Bark – the last three named from prominent members of the Company. Not more than three of these ships were in use at the same time.

The fitting out of these ships was a work needing much attention from the sub-committee. Year after year its members went down to Gravesend about the end of May, saw the goods which had been purchased placed aboard the ships, paid the captain and men their wages, delivered the agents to be sent out their commissions, and exercised plenary power in regard to emergencies which arose. The articles selected indicate very clearly the kind of trade in which the Company engaged. The inventory of goods in 1672 shows how small an affair the trade at first was. "Two hundred fowling-pieces, and powder and shot; 200 brass kettles, size from five to sixteen gallons; twelve gross of knives; 900 or 1000 hatchets," is recorded as being the estimate of cargo for that year.

A few years, however, made a great change. Tobacco, glass beads, 6,000 flints, boxes of red lead, looking-glasses, netting for fishing, pewter dishes, and pewter plates were added to the consignments. That some attention was had by the Company to the morals of their employés is seen in that one ship's cargo was provided with "a book of common prayer, and a book of homilies."

About June 1st, the ship, or ships, sailed from the Thames, rounded the North of Scotland, and were not heard of till October, when they returned with their valuable cargoes. Year after year, as we read the records of the Company's history, we find the vessels sailing out and returning with the greatest regularity, and few losses took place from wind or weather during that time.

The agents of the Company on the Bay seem to have been well selected and generally reliable men. Certain French writers and also the English opponents of the Company have represented them as timid men, afraid to leave the coast and penetrate to the interior, and their conduct has been contrasted with that of the daring, if not reckless, French explorers. It is true that for about one hundred years the Hudson's Bay Company men did not leave the shores of Hudson Bay, but what was the need so long as the Indians came to the coast with their furs and afforded them profitable trade! By the orders of the Company they opened up trade at different places on the shores of the Bay, and we learn from Oldmixon that fifteen years after the founding of the Company there were forts established at (1) Albany River; (2) Hayes Island; (3) Rupert's River; (4) Port Nelson; (5) New Severn. According to another authority, Moose River takes the place of Hayes Island in this list. These forts and factories, at first primitive and small, were gradually increased in size and comfort until they became, in some cases, quite extensive.

The plan of management was to have a governor appointed over each fort for a term of years, and a certain number of men placed under his direction. In the first year of the Hudson's Bay Company's operations as a corporate body, Governor Charles Bailey was sent out to take charge of Charles Fort at Rupert's River. With him was associated the French adventurer, Radisson, and his nephew, Jean Baptiste Groseilliers. Bailey seems to have been an efficient officer, though fault was found with him by the Company. Ten years after the founding of the Company he died in London, and was voted a funeral by the Company, which took place by twilight to St. Paul's, Covent Garden. The widow of the Governor maintained a contention against the Company for an allowance of 400l., which was given after three years' dispute. Another Governor was William Lydall, as also John Bridgar, Governor of the West Main; and again Henry Sargeant, Thomas Phipps, Governor of Fort Nelson, and John Knight, Governor of Albany, took an active part in the disputes of the Company with the French. Thus, with a considerable amount of friction, the affairs of the Company were conducted on the new and inhospitable coast of Hudson Bay.

To the forts from the vast interior of North America the various tribes of Indians, especially the Crees, Chipewyans, and Eskimos, brought their furs for barter. No doubt the prices were very much in favour of the traders at first, but during the first generation of traders the competition of French traders from the south for their share of the Indian trade tended to correct injustice and give the Indians better prices for their furs.

The following is the standard fixed at this time: —

The trade conducted at the posts or factories along the shore was carried on by the local traders so soon as the rivers from the interior – the Nelson and the Churchill – were open, so that by the time the ship from London arrived, say in the end of July or beginning of August, the Indians were beginning to reach the coast. The month of August was a busy month, and by the close of it, or early in September, the ship was loaded and sent back on her journey.

By the end of October the ships arrived from Hudson Bay, and the anxiety of the Company to learn how the season's trade had succeeded was naturally very great. As soon as the vessels had arrived in the Downs or at Portsmouth, word was sent post haste to London, and the results were laid before a Committee of the Company. Much reference is made in the minutes to the difficulty of preventing the men employed in the ships from entering into illicit trade in furs. Strict orders were given to inspect the lockers for furs to prevent private trade. In due time the furs were unladen from the ships and put into the custody of the Company's secretary in the London warehouse.

The matter of selling the furs was one of very great importance. At times the Company found prices low, and deferred their sales until the outlook was more favourable. The method followed was to have an auction, and every precaution was taken to have the sales fair and aboveboard. Evidences are not wanting that at times it was difficult for the Court of Adventurers to secure this very desirable result.

The matter was not, however, one of dry routine, for the London merchants seem to have encouraged business with generous hospitality. On November 9th, 1681, the sale took place, and the following entry is found in the minutes: "A Committee was appointed to provide three dozen bottles of sack and three dozen bottles of claret, to be given to buyers at ye sale. Dinner was also bespoken at 'Ye Stillyard,' of a good dish of fish, a loyne of veal, two pullets, and four ducks."

As the years went on, the same variations in furs that we see in our day took place. New markets were then looked for and arrangements made for sending agents to Holland and finding the connections in Russia, that sales might be effected. In order to carry out the trade it was necessary to take large quantities of hemp from Holland in return for the furs sent. The employment of this article for cordage in the Navy led to the influence of important members of the Company being used with the Earl of Marlborough to secure a sale for this commodity. Pending the sales it was necessary for large sums of money to be advanced to carry on the business of the Company. This was generally accomplished by the liberality of members of the Company itself supplying the needed amounts.

The Company was, however, from time to time gratified by the declaration of handsome dividends. So far as recorded, the first dividend was declared in 1684, and judged by modern standards it was one for which a company might well wait for a number of years. It was for 50 per cent. upon stock. Accordingly, the Earl of Craven received 150l., Sir James Hayes 150l., and so on in proportion. In 1688 another dividend of a like amount of 50 per cent. on the stock resulted, and among others, Hon. Robert Boyle, Earl Churchill, and Sir Christopher Wren had their hearts gladdened. In 1689 profits to the extent of 25 per cent. on the stock were received, and one of the successful captains was, in the exuberance of feeling of the stockholders, presented with a silver flagon in recognition of his services. In 1690, however, took place by far the most remarkable event of a financial kind in the early history of the Company. The returns of that year from the Bay were so large that the Company decided to treble its stock. The reasons given for this were: —

(1) The Company has in its warehouse about the value of its original stock (10,500l.). (2) The factories at Fort Nelson and New Severn are increasing in trade, and this year the returns are expected to be 20,000l. in beaver. (3) The factories are of much value. (4) Damages are expected from the French for a claim of 100,000l.

The Company then proceeded to declare a dividend of 25 per cent., which was equivalent to 75 per cent. on their original stock.

It was a pleasing incident to the sovereign of the realm that in all these profits he was not forgotten. In the original Charter the only recompense coming to the Crown, for the royal gift, was to be the payment, when the territory was entered upon, of "two elks and two black beavers." This may have been a device for keeping up the royal claim, but at any rate 300l. in the original stock-book stood to the credit of the sovereign. It had been the custom to send a deputation to present in person the dividends to His Majesty, and the pounds sterling were always changed to guineas.

On this occasion of the great dividend, King William III. had but lately returned from his victories in Ireland. The deputation, headed by Sir Edward Dering, was introduced to the King by the Earl of Portland, and the following address, hitherto, so far as known to the writer, unpublished, was presented along with the noble gift: —

"Your Majestie's most Loyal and Dutiful subjects beg leave to congratulate your Majestie's Happy Return here with Honor and Safety. And we do daily pray to Heaven (that Hath God wonderfully preserved your Royall Person) that in all your undertakings Your Majestie may be as victorious as Cæsar, as beloved as Titus, and (after all) have the long and glorious Reigne and Peacefull end of Augustus.

"On this happy occasion we desire also most humbly to present to your Majestie a dividend of Two Hundred and twenty-five guineas upon three hundred pounds stock in the Hudson's Bay Company, now Rightfully delivered to your Majestie. And although we have been the greatest sufferers of any Company from those common enemies of all mankind the French, yet when your Majestie's just Arms shall have given Repose to all Christendom, we also shall enjoy our share of these great Benefits and do not doubt but to appeare often with this golden fruit in our hands, under the happy influence of Your Majestie's most gracious protection over us and all our Concerns."

It is true that towards the end of the seventeenth century, as we shall afterwards see, the trade of the Company was seriously injured by the attacks of the French on the Bay, but a quarter of a century in which the possibility of obtaining such profits had been shown was sufficient to establish the Company in the public favour and to attract to it much capital. Its careful management from the first led to its gaining a reputation for business ability which it has never lost during two and a quarter centuries of its history.