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No. 3. Mbmoeandum by Assistant-Deputy Commissioner Musgbavb respecting Acquisition of certain Government Lands. Government Bungalow, Granville, British New Guinea, 9th November, 1886. In compliance with your Excellency's verbally-expressed wish, I have the honour to report upon the acquisition of Government lands in British New Guinea up to this date. 2. The first acquisitions on the part of Protectorate officers were the sites of the Government bungalow, comprising about an acre, and a strip extending in a southerly direction from the Argus Villa for about 20 chains along the harbour and about 4 chains in width. These plots were secured from the Motu and Koitapu people of the villages adjacent to the London Mission-station, in the same manner that the representatives of that Mission originally obtained sites for their buildings and gardens. This is by giving to the claimants of the ground desired certain articles in barter, such as hatchets, gaudy cloth, tobacco, &c. I beg to enclose copies of the authority I received from the late Special Commissioner (Sir Peter H. Scratchley) for making this and other land-purchases for the Government. He also intimated to me verbally his desire to take over other lands wherever it was practicable and convenient. His Excellency was not an eye-witness of this first transaction, as his plans obliged him to leave for Eedscar Bay on the same day, the Bth September, 1885. A copy of some notes which I made at the time of this purchase is also annexed. No form of " memorandum of land-purchase " has ever been supplied to me, nor did I receive any written instructions other than the authority mentioned. While referring to this first Government purchase, it will doubtless interest your Excellency to see the accompanying copy of probably the first record of a land transaction in Port Moresby, if not in British New Guinea. This paper was placed in my keeping by the Eev. Mr. Lawes about a year ago. The strip of land along the harbour was secured in order to assign positions for stations to certain traders who had applied for them. The late Special Commissioner was, however, in a doubtful and difficult position with regard to his powers either to acquire or alienate lands. According to' a regulation in force on his arrival, and which has never been formally rescinded, Commodore Erskine, at the date of the Protectorate, had enacted that " No settlement or acquisition of land is on any account to be permitted." On the other hand, clause 9 of the Special Commissioner's Instructions seems distinctly to imply that land-purchases may be made, and apparently at the discretion of the Special Commissioner. He is also given instructions as to his responsibilities and duties, as the clause states, "in the event of any such purchases being made." Further, in clause 10 he is directed to "give all proper encouragement to peaceful and legitimate trade between the natives and persons who may visit the Protectorate." It was so obvious that one of the first essential requisites for trading is a site upon which to put buildings, that I understand the late Special Commissioner held that his commission and instructions gave him sufficient discretionary power to act for the general good, and upon well-approved principles of settlement, and in this sense to relax Eegulation No. 4. He therefore determined that Government officers should first treat with the natives in all cases for the acquisition of lands the latter wished to sell, and that a subsequent grant of a provisional right of occupation might be allowed to the foreign settler. This was the course followed in the cases of Mr. Theodore Bevan and Messrs. Davis and Anderson, who both began business here last year, but have since abandoned the settlement. A register-book of such licenses for provisional occupation was opened, as I have previously mentioned to your Excellency. No fees were charged, as no power seemed to be conferred for their collection, and on account of the insecurity of tenure allowed. 3. On the following day (sth September, 1885) a narrow strip of land was purchased to connect the bungalow site already described in my despatch to Her Majesty's Secretary of State of the , 1885, with the beach purchases. 4. On the 14th September Sir Peter Scratchley settled with Mr. Andrew Goldie for the purchase of the Argus Camp building, and relinquishment of any rights to the site of about an acre of ground, for £30. The purchase of the land from Mr. Goldie was expressly repudiated, as that would have implied a right to sell, and therefore a right of possession on his part. Any such admission would have created a precedent with regard to other land he occupied, and other claimants of the same class. 5. On the 7th day of October it would appear that Sir Peter Scratchley bought a piece of ground at Suau (South Cape). A copy of the memorandum of this purchase is to be found on page 50 (No. 31) of Mr. G. S. Fort's report on the cruise of the " Governor Blackall." The amount paid for this position was about £3 7s. 6d. in trade, but the approximate area is not stated. 6. On the 14th and 15th of October Mr. Eobert Hunter and Euatoka the Mission teacher bought from the Koitapuan natives of the village of Verentu or Badili certain lands now known in the local surveys as the Badili lands. I did not perambulate the boundaries myself, but I was present, and the Eev. Mr. Lawes also kindly attended at the payment of the claimants. We were assured of their being satisfied with the completion of their sale. One hundred and twenty-eight vendors had to be paid for 333 acres of land. These are the contents of the block as fixed by a recent theodolite survey, of which your Excellency has inspected the plan. The main object in securing this block was to be able, in the event of Port Moresby natives proper being reluctant to sell, or making excessive demands for lands urgently needed for settlement, to substitute other holdings equally suited for cultivation, but not equally monopolizing wharf frontages, &c. There was risk of these positions being taken by the natives on the advice of certain Malays and South Sea Islanders who have taken Motu women as "wives," and who use some influence over the aboriginal villagers. The Badili lands lie well within three miles of the Government bungalow, cost less than £30 in trade, and are estimated by some persons of Australian experience to be worth £10 per acre, or