SUEZ MAIL SERVICE, (FURTHER PAPERS RELATIVE TO). In continuation of Papers presented on the 17th August, 1874.

Appendix to the Journals of the House of Representatives, 1875 Session I, F-02

F.—2

1875. NEW ZEALAND.

SUEZ MAIL SERVICE, (FURTHER PAPERS RELATIVE TO). In continuation of Papers presented on the 17th August, 1874.

Presented to both Houses of the General Assembly by Command of His Excellency.

No. 1. The Hon. G. B. Keefeed, Victoria, to the Hon. the Colonial Seceetaey, New Zealand. Sic, — Chief Secretary's Office, Melbourne, 7th October, 1874. In reply to your letter of the 18th of July last, enclosing a memorandum from the PostmasterGeneral of New Zealand on the subject of the proposed detention of the Homeward mail steamer, in case the branch steamer from New Zealand should not arrive before the time appointed for the sailing of the steamer for Point do Galle, I have the honor to state that this Government fully recognizes the importance of this question, and that every possible consideration is due to New Zealand in connection therewith. In any future case in which the New Zealand mails may be late, the Postmaster-General of this colony will authorize as long a detention as may be considered safe, having a due regard to the performance of the main service. On the occasion of the departure of the " Nubia " on the Bth of September, the commander of that vessel was prepared, according to arrangement with the Post Office Department, to detain her for twelve hours at Port Phillip Heads for the arrival of the " Albion," expected with the New Zealand supplementary mail, and, as a matter of fact, she did not go to sea until 8 o'clock next morning. I have enclosed two copies of the contract between this Government and the Peninsular and Oriental Steam Navigation Company for Mr. Vogel's information, in compliance with his request. I have, &c, Geo. B. Keefeed. The Hon. the Colonial Secretary of New Zealand, Wellington.

F.—3,1874, No. 6.

Enclosure in No. 1. Copt of the Conteact entered into with the Peninsulae and Oeiental Steam Navigation Company. Articles of Ageeement made this tenth day of June, one thousand eight hundred and seventy-three, between the Honorable Edward Langtou, as Her Majesty the Queen's Postmaster-General of the Colony of Victoria, and for and on behalf of Her Majesty's Government of the said Colony of Victoria, of the one part, and the Peninsular and Oriental Steam Navigation Company, hereinafter called "the Company," of the other part. Witness that the Company for themselves and their successors hereby covenant with the said Edward Langton, his executors, administrators, successors, and assigns ; and the said Edward Langton, as such Postmaster-General, and for and on behalf of Her Majesty's Government of the said Colony, doth hereby covenant with the Company in manner following, that is to say, — 1. That the Company will at all times during the continuance of this Agreement, or so long as the whole or any part of the services hereby agreed to be performed ought to be performed in pursuance hereof, provide, keep seaworthy, and in complete repair and readiness, for the purpose of conveying, as hereinafter provided, all Her Majesty's mails (in which term "mails," used throughout this Agreement, all boxes, bags, or packets of letters, newspapers, books, or printed papers, and all other articles I—F. 2.

F.—2

2

transmissible by the post, without regard either to the place to which they may be addressed or to that in which they may have originated, and all empty bags, empty boxes, and other stores and articles used or to be used in carrying on the Post Office Service which shall be sent by or to or from the Post Office, are agreed to be comprehended) which shall at any time and from time to time by the Postmaster-General or any of his officers or agents be required to be conveyed, as hereinafter provided, between Melbourne in Victoria, and Point de Galle in Ceylon, by way of and calling at King George's Sound, in the Colony of "Western Australia, and also, if required so to do, at any time or times hereafter, by the PostmasterGeneral, by way of and calling at Glenelg, in the Province of South Australia, a sufficient number of good, substantial, and efficient steam vessels of adequate power, and supplied with first-rate appropriate steam engines. 2. Every vessel carrying mails under this Agreement shall, on entering Port Phillip Bay, in Victoria, weather permitting, stop to deliver alongside the vessel the Geelong mails at Queenscliff. 3. That the vessels to be employed under this Agreement shall be always furnished with all necessary and proper machinery, engines, apparel, furniture, stores, tackle, boats, fuel, lamps, oil, tallow, provisions, anchors, cables, fire-pumps, and other proper means of extinguishing fire, lightning conductors, charts, chronometers, nautical instruments, and whatsoever else may be requisite for equipping the said vessels, and rendering them constantly efficient for the service hereby agreed to be performed, and also manned and provided with competent officers with appropriate certificates, granted pursuant to the Act or Acts of the Imperial Parliament of Great Britain and Ireland in force for the time being relative to the granting of certificates to officers in the Merchant Service, and with a sufficient number of efficient engineers and a sufficient crew of able seamen and other men, to be in all respects, as to vessels, engines, equipment, officers, engineers, and crew, subject in the first instance and from time to time and at all times afterwards to the approval of the Postmaster-General or of such person or persons as he shall at any time or times or from time to time authorize to inspect and examine the same. 4. The Company shall provide, to the satisfaction of the Postmaster-General, on board all vessels employed to carry mails under this Agreement, proper, safe, vermin-proof, and convenient places of deposit for the mails, with locks, keys and secure fastenings. 5. That one of such vessels so approved, equipped, and manned as aforesaid shall, once in every twenty-eight days, and on such days and at such hours as shall be fixed by the Postmaster-General upon or after the day hereinafter appointed for the commencement of this Agreement (until and unless any other days or hours shall, under the proviso herein in that behalf contained, be substituted instead thereof), and immediately after the mails are embarked, put to sea from the ports of Melbourne and Point de Galle respectively, and the Company shall convey in such vessels to and from and cause to be delivered and received at such of the ports or places hereinbefore mentioned all such mails as shall or may be tendered or delivered to or received by the Company or any of their agents, officers, or servants by or from or under the direction of the Postmaster-General or any of his officers or agents. 6. That if at any time or times the Postmaster-General shall desire to alter the particular days, times, or hours of departure from and arrival at any of the ports or places to or from which mails are to be conveyed under this Agreement, he shall be at liberty so to do on giving three calendar months' previous notice in writing of such his desire to the Company, and the Company shall observe, perform, fulfil, and keep such altered days, times, and hours. 7. That should it be deemed by the Postmaster-General requisite for the public service that any vessel to be employed under this Agreement should at any time or times delay her departure from any port from which the mails are to be conveyed under this Agreement beyond the period appointed for her departure therefrom, the Postmaster-General, his officers or agents, shall have power to order such delay (not however exceeding twenty-four hours), by letter addressed by him or them to the master of any such vessel or person acting as such, and which shall be deemed a sufficient authority for such detention. 8. That the Company shall convey the said mails from Point de Galle by way of and calling at King George's Sound and Glenelg to Melbourne in five hundred and sixteen hours, but if not calling at Glenelg then in five hundred and four hours ; and from Melbourne by way of and calling at Glenelg and King George's Sound to Point de Galle in four hundred and eighty-five hours, but if not calling at Glenelg then in four hundred and sixty-one hours, which several periods or portions of time are exclusive of stoppages for the purpose of the delivery and reception of mails, the duration of which shall not exceed twenty-four hours at King George's Sound and twelve hours at Glenelg : And it is hereby agreed that if the Company shall fail to deliver the said mails at Melbourne from Point de Galle by way of and calling at Glenelg in five hundred and sixteen hours, but if not calling at Glenelg in five hundred and four hours, or at Point de Galle from Melbourne by way of and calling at Glenelg in four hundred and eighty-five hours, but if not calling at Glenelg then in four hundred and sixty-one hours, then or in any of such cases, and so often as the same shall happen, the Company shall forfeit and pay to Her Majesty, Her heirs and successors, the sum of one hundred pounds for every complete period of twenty-four hours consumed on the respective voyages beyond the periods hereinbefore respectively specified : Provided always that the full amount of such sums payable on any one voyage shall never exceed the portion of the sum of the subsidy hereinafter agreed to be paid by the Post-master-General as applicable to such voyage ; and provided further that the payment of any such sum shall not be enforced against the Company if it be shown by them to the satisfaction of the Postmaster-General that the delay has arisen from causes over which they had not and could not have had any control. 9. The Postmaster-General doth hereby agree to pay to the Company a premium of fifty pounds for every complete period of twenty-four hours by which the time occupied by any voyage shall be less than four hundred and eighty-five hours from Melbourne to Point do Galle by way of Glenelg and King George's Sound, or four hundred and sixty-one hours if not calling at Glenelg, and five hundred and sixteen hours from Point de Galle to Melbourne by way of and calling at King George's Sound and Glenelg, or five hundred and four hours if not calling at Glenelg.

F.—2

3

10. That if the Company fail to provide an efficient vessel at Point de Galle or Melbourne in accordance with the terms of this Agreement, ready to put to sea on and at the appointed day and hour, then and so of,ten as the same shall happen the Company shall forfeit and pay unto Her Majesty, Her heirs and successors, the sum of five hundred pounds, and also the further sum of one hundred pounds for every successive twenty-four hours which shall elapse until such vessel actually proceeds to sea on her voyage in the performance of this Agreement: Provided always that the aggregate amount of the penalties to be recoverable under this clause in respect of any one voyage or contemplated voyage shall not exceed by more than the sum of two thousand pounds the proportion of the subsidy hereinafter agreed to be paid by the Postmaster-General as applicable to such voyage. 11. That during the continuance of this Agreement the commanders of the vessels to be employed for the time being in carrying the mails under this Agreement shall take due care of, and the Company shall be responsible for the receipt, safe custody, and delivery of the said mails, and each of such masters or commanders shall make such oath or declaration or declarations now lawfully required or which may hereafter be lawfully required by the Postmaster-G-eneral in such and similar cases, and furnish such journals, returns, and information to and perform such services as the Postmaster-General may require ; and every such master or commander, or officer duly authorized by him, having the charge of mails, shall himself, immediately on the arrival at any of the said ports or places of any such vessel, deliver all Mails for such port or place into t he hands of the Postmaster or other person at such port or place as the Postmaster-General shall authorize to receive the same, receiving in like manner all the return or other mails to be forwarded in due course. 12. That the Company shall not, nor shall any of the masters of any of the vessels employed or to be employed under this Agreement, receive or permit to be received on board any of the vessels carrying the mails under this Agreement any letters for conveyance other than those carried under this Agreement in charge of the said commander or other person authorized to have charge of the said mails, or which are or may be privileged by law ; nor shall any mails be conveyed by the Company between Point de Galle and any of the Australasian Colonies or New Zealand for or on behalf of any colony, province, or foreign country, save those carried under this Agreement, without the consent in writing of the Postmaster-General. 13. That the Port of Melbourne shall be the Australian terminus of vessels carrying mails under this Agreement, and such vessels shall not after delivering the mails at Melbourne proceed to any other port or place with goods or passengers save on the return voyage to Point de Galle, except with the consent of the Postmaster-General in writing. 14. That the Postmaster-General shall have full power, whenever and as often as he may deem it requisite, to survey by any of his officers or agents all or any of the vessels employed and to be employed in the performance of this Agreement, and hulls thereof; and the engines, machinery, furniture, tackle, apparel, stores, equipments, and the officers, engineers, and crew of every such vessel, and any defect or deficiency that may be discovered on any such survey shall be forthwith repaired or supplied by the Company; and if any of such vessels or any part thereof, or any engines, machinery, furniture, tackle, apparel, boats, stores, or equipments, shall on any such survey be declared by any of such officers or agents unseaworthy or not adapted to the service hereby agreed to be performed, every vessel which shall be disapproved of, or in which such deficiency or defect shall appear, shall be deemed insufficient for any service hereby agreed to be performed, and shall not be again employed in the conveyance of mails until such defect or deficiency has been repaired or supplied to the satisfaction of the Postmaster-General. 15. That the Company and all commanding and other officers of the vessels employed in the performance of this Agreement, and all agents, seamen, and servants of the Company, shall at all times punctually attend to the orders and directions of the Postmaster-General, his officers or agents, as to the mode, time, and place of landing, delivering, and receiving mails. 16. That all and every the sums of money hereby stipulated to be forfeited or paid by the Company unto Her Majesty, her heirs and successors, shall be considered as stipulated or ascertained damages, whether any damage or loss have or have not been sustained, and shall and may be retained and deducted by the Postmaster-General out of any moneys payable or which may thereafter become payable to the Company. 17. And in consideration of the due and faithful performance by the said Company of all the services hereby agreed to be by them performed, the said Postmaster-General doth hereby agree that there shall be paid at Melbourne to the said Company by Her Majesty's Government of Victoria, so long as the Company perform the voyages and services herein contracted to be performed, a sum of money after the rate of ninety thousand pounds per annum (£90,000), in equal quarterly payments, on the first day of April, the first day of July, the first day of October, and the first day of January in each year, and shall accrue due from day to day; and the said payments shall be received by the said Company as full compensation for all costs and expenses which they may incur or be put unto by reason or on account of all and singular the services hereby contracted to be performed, subject however to the abatement or deduction of any sums of money in respect to forfeitures which the said Company may have incurred, or to the addition of any sums in respect of premiums, as the case may be, as herein provided. 18. That if at any time during the continuance of this Agreement or after the determination thereof any dispute shall arise between the parties to these presents or their successors respectively concerning any breach or alleged breach by or on the part of the Company of this Agreement, or the sufficiency of any such breach to justify the Postmaster-General in the putting an end to the same, or concerning any of the"covenants, matters, or things hereinbefore contained or in anywise relating thereto, and notwithstanding the power herein contained to determine this Agreement, and any execution or attempted execution of such power, such dispute shall be referred to two arbitrators, one to be chosen from time to time by the Postmaster-General, and the other by the Company ; and if such arbitrators should at any time or times not agree on the matter or question referred to them, then such question in difference shall be referred by them to an umpire to be chosen by such arbitrators before they proceed

F.—2

4

with the reference to them, and the joint and concurrent award of the said arbitrators, or the separate award of the said umpire when the said arbitrators cannot agree, shall be binding and conclusive upon both parties ; and every such arbitration shall be held in Melbourne aforesaid. 19. The Contractors shall have no claim to any postage nor to any payment on account thereof for mails carried under this contract except as herein provided. 20. That this Agreement shall commence on and from the first day of January, one thousand eight hundred and seventy-four, and shall continue until the first day of February, one thousand eight hundred and eighty, and shall then determine if the Postmaster-General shall by writing under his hand have given to the Company, or if the Company shall have given to the Postmaster-General, twenty-four calendar months' notice that this Agreement shajl so determine; but if neither the Post-master-General nor the Company shall give any such notice, this Agreement shall continue in force after the said first day of February, one thousand eight hundred and eighty, until the expiration of a twenty-four calendar months' notice in writing as aforesaid, which may be given by either of the said parties hereto to the other of them, and which last-mentioned notice may be given at any time after the expiration of the first four years. This Agreement shall then determine accordingly, without prejudice nevertheless to any right of action or other proceeding which shall then have accrued to either party for any breach thereof. 21. And it is hereby further agreed that in case the Company shall fail to commence the performance of the services herein agreed to be by them performed on the first day of January, one thousand eight hundred and seventy-four, then and in such case the Company shall forfeit and pay unto Her Majesty, her heirs and successors, the sum of one hundred pounds, and also the further sum of one hundred pounds for every successive period of twenty-four hours which shall elapse after the first day of January, one thousand eight hundred and seventy-four, until the actual and bond fide commencement of the performance by the Company of the services herein agreed to be by them performed : Provided always that the total amount of the penalties to be incurred by the said Company by reason of such failures as aforesaid respectively shall not exceed the sum of twenty-five thousand pounds. 22. That the Company shall not assign, underlet, or dispose of this Agreement or any part thereof without the consent of the Postmaster-General signified in writing under his hand, and that in case of the same or any part thereof being assigned, underlet, or otherwise disposed of, or of any breach of clause numbered 12 of these presents, or of any great or habitual breach of this Agreement or of any covenant, matter, or thing herein contained, on the part of the Company, their officers, agents, or servants, and whether there bo or be not any penalty or sum of money payable by the Company for any breach, it shall be lawful for the Postmaster-General, by writing under his hand, to determine this Agreement without any previous notice to the Company or their agents. 2:i. That if on the determination of this Agreement any vessel or vessels should have started or should start with the mails in conformity with this Agreement, such voyage or voyages shall be continued and performed and the mails be delivered and received during the same as if this Agreement had remained in force with regard to any such vessels and services; and with respect to such vessels and services as last aforesaid, this Agreement shall be considered as having terminated when such vessels and services shall have reached their port or place of destination and been performed. 24. It shall be lawful for the Postmaster-General, by writing under his hand, at any time and from time to time, to delegate any of the powers vested in him by virtue of this Agreement to such person or persons as he may think fit. 25. That all notices or directions which the Postmaster-General, his officers, agents, or others, are hereby authorized to give to the Company, their officers, servants, or agents, other than any notice of termination of this contract, may, at the option of the Postmaster-General, either be delivered to the master of any of the said vessels or other officer or agent of the Company in the charge or management of any vessel employed in the performance of this Agreement, or left for the Company at their office or house of business in Melbourne, or at their or any of their last-known places of business or abode in Melbourne ; and any notices or directions so given or left shall be binding on the Company : Provided always that any notice of termination of this contract shall be served on the Company, their officers, servants, or agents, at their office or last-known office in Melbourne. 26. That any submission to arbitration in pursuance of this Agreement shall be made a rule of the Supreme Court of the Colony of Victoria, pursuant to the Statute in that case made and provided, on the application of either party. 27. And for the due and faithful performance of all and singular the covenants, conditions, provisoes, clauses, articles, and agreements hereinbefore contained, and which on the part and behalf of the said Company, their officers, agents, or servants, are or ought to be observed, performed, fulfilled, and kept, the said Company do hereby bind themselves and their successors unto Her Majesty in the sum of twenty-five thousand pounds sterling, to be paid to Her Majesty, her heirs and successors, by way of stipulated or ascertained damages, hereby agreed upon between the PostmasterGeneral and the said Company, in case of the failure on the part of the Company in the execution of this contract or any part thereof. 28. The words " Postmaster-General " herein shall mean the Postmaster-General of the Colony of Victoria for the time being, or the Responsible Minister of the Crown for the time being administering the Post Office Department.

No. 2. The Hon. D. Pollen to the Hon. the Chief Seceetaet, Victoria. Sir,— Colonial Secretary's Office, Wellington, 28th October, 1874. I have the honour to acknowledge the receipt of your letter of the 7th instant, in which you inform me that in any future case in which the New Zealand mails may be late, the Post-

5

F.—2

master-General of Victoria will authorize as long a detention of the homeward mail steamer as may be considered safe, having a due regard to the performance of the main service. In reply, I beg to express to you the thanks of this Government for the consideration evinced by the Victorian Government for the interests of this colony in this important matter. I have also to thank you for the copies of the contract between your Government and the P. and 0. Steam Company, transmitted in your letter for Mr. Vogel's information. I have, &c, The Hon. the Chief Secretary, Victoria. Daniel Pollen.

No. 3. The Secretary of State for the Colonies to the Officer Administering the Government of New Zealand. Sir, — Downing Street, 10th December, 1874. I have the honor to transmit to you, for your information, copy of a letter from the Treasury, forwarding copy of a letter addressed by their Lordships' direction to the Postmaster-General, and copies of contracts, dated respectively the Bth July* and Ist August, 1874, between the PostmasterGeneral and the Peninsular and Oriental Steam Navigation Company for the conveyance of the East India, China, and Japan mails. Some delay has occurred in procuring the requisite number of copies of the enclosures to this despatch, which has prevented my sooner communicating to you the changes which have been made in the postal contract. I have, &c, The Officer Administering the Government of New Zealand. Carnarvon.

Enclosure 1 in No, 3. The Treasury to the Colonial Office. Sir, — Treasury Chambers, 3rd September, 1874. With reference to your letters of the 2nd April last and 31st ultimo, in regard to the application of the Peninsular and Oriental Steam Navigation Company to be allowed to carry the heavy portion of the India, &c. mails through the Suez Canal, I am directed by the Lords Commissioners of Her Majesty's Treasury to transmit to you, for the information of the Earl of Carnarvon, a copy of a letter which my Lords caused to be addressed to the Postmaster-General on the 24th of June last, together with a copy of their Lordships' minute forwarded therewith, of the contract dated Bth July, entered into with the Peninsular and Oriental Steam Navigation Company, and of the minute attached thereto of a letter from the Postmaster-General dated Ist ultimo, and of the subsequent contract entered into with the Company, dated Ist ultimo, with Treasury minute and memorandum from the Postmaster-General attached thereto. I am at the same time to express their Lordships' regret that, through inadvertence, the information now afforded was not furnished at an earlier date. I have, &c, E. G. "W. Herbert, Esq., Colonial Office. Charles W. Stronoe, Pro Sec.

Enclosure 2 in No. 3. TtETURN to an Order of the Honorable the House of Commons, dated Ist August, 1874, for copy " of a Contract dated the Ist day of August, 1874, between the Postmaster-General and the Peninsular and Oriental Steam Navigation Company for the Conveyance of the East India, China, and Japan Mails, together with copy of a Treasury Minute dated the Ist day of August, 1874, thereon ; and copy of a Memorandum by the Postmaster-General relating thereto." Treasury Chambers, Ist August, 1874. W. H. Smith. Peninsular and Oriental Company.—Contract or Ist August, 1874. EAST INDIA, CHINA, AND JAPAN MAILS. Articles of Agreement made this Ist day of August, 1874, between the Eight Honorable John James Robert Manners (commonly called Lord John Manners), Her Majesty's PostmasterGeneral for the time being, on behalf of Her Majesty of the one part, and the Peninsular and Oriental Bteam Navigation Company of the other part, witness that the Company for themselves, their successors and assigns, hereby covenant with the Postinaster-G-eneral, his executors, administrators, successors, and assigns, Her Majesty's Postmasters-General for the time being, in manner following (that is to say),— 1. For all purposes of these presents the term " mails " shall be understood to comprehend all boxes, bags, or packets of letters, newspapers, books or printed papers, and all other articles which under the existing regulations of the Post Office are transmissible by the post, without regard either to the place to which they may be addressed or to that in which they may have originated, and all empty bags, empty boxes, and other stores and articles used or to be used in carrying on the Post Office service which shall be sent by or to or from the Post Office. * Contract of Btli July not published.

F.—2

6

2. If at any time the Postmaster-General shall desire to modify the existing regulations as to articles transmissible by the post, either by prohibiting the transmission by the post of the articles which are now transmissible thereby, or by authorizing the transmission by the post of articles which are not now transmissible thereby, he shall be at liberty so to do on giving reasonable notice to the Company, and in case the effect of such modification shall be to diminish the burden of the services hereinafter agreed to be performed, a deduction shall be made from the annual subsidy hereinafter stipulated to be paid to the Company ; and in case the effect of such modification shall be to increase the burden of the services hereinafter agreed to be performed, an addition shall be made to such subsidy, and the amount of such deduction or addition, as the case may be, shall be settled by agreement between the Postmaster-General and the Company, or, failing agreement, by arbitration in manner hereinafter provided. 3. The Company will at all times during the continuance of this Agreement, or so long as the whole or any part of the services hereby agreed to be performed ought to be performed in pursuance thereof, provide, keep seaworthy, and in complete repair and readiness for the purpose of conveying as hereinafter provided all Her Majesty's mails which shall at any time and from time to time by the Post-master-General or any of his officers or agents be required to be conveyed as hereinafter provided, on all the routes specified in the First Schedule hereunder written, a sufficient number of good substantial and efficient steam vessels of adequate power and speed, and supplied with first-rate appropriate steamengines, and in all respects suited to the performance of the services herein agreed to be performed within the respective times herein stipulated. 4. The vessels to be provided under this agreement shall be always furnished with all necessary and proper tackle, stores, oil, tallow, fuel, provisions, machinery, engines, anchors, cables, boats, firepumps, and all other proper and requisite means for extinguishing fire; lightning-conductors, charts, chronometers, proper nautical instruments, and all other furniture and apparel, and whatsoever else may be requisite and necessary for equipping the said vessels and rendering them constantly efficient for the said services, and manned with competent officers with appropriate certificates granted pursuant to the Act 17 and 18 Viet. c. 104, or to the Act or Acts in force for the time being relative to the granting certificates to officers in the Merchant Service, and also with competent engineers and a sufficient crew of able seamen and other men, and with a competent surgeon, to be subject to the approval of the Postmaster-General. 5. The Company shall land and embark the mails at Bombay by means of a small steam vessel, and accordingly the Company shall, in addition to the vessels hereinbefore mentioned, provide a small steamer, which shall be kept at Bombay in complete repair and ready for landing and embarking the mails. And also, in addition to the vessels hereinbefore mentioned, the Company shall provide and maintain iv complete repair an efficient tug steamer, which shall be kept in the Suez Canal for the purpose of assisting the other vessels of the Company in speedily and safely passing through the said canal in the performance of the services herein agreed to be performed. 6. If Her Majesty's Postmaster-General shall consider any of the Company's vessels unfit for the conveyance of mails, he may, by writing under his hand, or under the hand of the Secretary or one of the Assistant Secretaries of the Post Office, require the said Company to show cause why such vessel should not be withdrawn from the service ; and unless within six weeks after such requisition the said Company shall show cause to the contrary to the satisfaction of the said Postmaster-General, he may at any time after the expiration of the said period of six weeks by writing under his hand, or under the hand of the Secretary or one of the Assistant Secretaries of the Post Office, declare such vessel to be unfit for the conveyance of mails, and after such declaration shall have been made it shall not be lawful for the said Company to employ such vessel in the performance of this contract. And in order to determine whether the said Postmaster-General shall be justified in declaring any vessel unfit for the conveyance of mails, or whether the said Company shall be able to show cause to the contrary, a special examination shall be made of the hull and machinery of any such vessel by such person or persons as may be selected for that purpose by the Postmaster-General. 7. The equipments, officers, engineers, and crew of each vessel, when such vessel is in any British port, shall be subject at all times to the inspection of the said Postmaster-General, or ,of such other person or persons as he shall at any time or times authorize to make such inspection. 8. The Company shall convey the said mails from Brindisi to Bombay in 422 hours, and from Bombay to Brindisi in 424 hours, and from Brindisi to Point de Galle in 472 hours, and from Point de Galle to Brindisi in 488 hours, and from Brindisi to Shanghai in 965 hours, and from Shanghai to Brindisi iv 1,008 hours, and from Southampton to Bombay in 677 hours, and from Bombay to Southampton in 666 hours, and from Southampton to Point de Galle in 727 hours, and from Point de Galle to Southampton in 730 hours, and from Brindisi to Calcutta in 646 hours, and from Calcutta to Brindisi in 663 hours, and from Bombay to Shanghai in 618 hours, and from Shanghai to Bombay in 611 hours, and from Hong Kong to Yokohama in 170 hours, and from Yokohama to Hong Kong in 170 hours, and each of the periods of hours hereinbefore specified is to be reckoned as inclusive of stoppages for the purpose of the delivery and reception of the mails. And the arrangements for determining and recording the exact time of the arrival and departure of the vessels at and from the several places above named, and the period of every delay which shall take place on any voyage shall be under the exclusive regulation of the Postmaster-General, whose decision upon all questions relating to those matters shall be final. 9. One of the vessels to be provided under the third article of this Agreement shall on such days of the week and at such hours as the Postmaster-General shall appoint, and immediately after the mails are embarked, put to sea from, touch and arrive at the several ports or places respectively mentioned in the said First Schedule hereunder written; and all such vessels shall convey the said mails as mentioned in such Schedule, and all the stipulations, matters, and things therein contained shall form part of this Agreement, and be observed and performed by the Company accordingly. And the Company shall convey in such vessels to and from, and cause to be delivered and received at such of the ports or places mentioned in the said First Schedule from or at which the said vessels are to start, touch, and

7

F.—2

arrive in the performance of this Agreement, all such mails as shall or maybe tendered or delivered to or received by the Company, or any of their agents, officers, or servants, by or from the PostmasterGeneral or any of his officers or agents. 10. Should it be deemed by the Postmaster-General, his officers or agents, requisite for the public service that any such vessel to be employed under this Agreement should at any time or times delay her departure from any port from which the mails are to be conveyed under this Agreement beyond the period appointed for her departure therefrom, the Postmaster-General, his officers or agents, shall have power to order such delay (not however exceeding twenty-four hours) by letter addressed by him or them to the master of any such vessel or person acting as such, and which shall be deemed a sufficient authority for such detention. 11. In the event of any vessel of the Company, whilst passing through the Suez Canal in the performance of any of the services hereby agreed to be performed, becoming unable by reason of the stranding of such vessel in the said canal, or of any other difficulty or obstruction incident to the navigation thereof, to complete its passage through the said canal in due course, the Company shall use their utmost endeavours to prevent any delay in the delivery of the mails, and with that object shall employ in the subsequent conveyance of any mails on board such stranded or impeded vessel to their destination any other vessel belonging to the Company which may be at Suez, Port Said, or Alexandria, and available for the service. 12. The Company shall land at Ismailia all mails from Gibraltar or Malta for Alexandria, and shall embark at Ismailia all mails from Alexandria for Malta or Gibraltar, and shall convey at the expense of the Company all such mails by despatch boat from Port Said to Ismailia, and from Ismailia to Port Said, whenever the employment of such means of conveyance shall be found more expeditious than landing the mails at Ismailia direct from the mail packet, or embarking them at Ismailia on board the packet, and shall repay to the Postmaster-General and indemnify him from all expenses which may be incurred with the Egyptian Post Office in respect of the conveyance of such mails between Ismailia and Alexandria in either direction. 13. If at any time the Company shall desire to modify the services hereby agreed to be performed by substituting Plymouth or Liverpool for Southampton as one of the ports to and from which mails are to be conveyed under this Agreement, they shall be at liberty so to do on giving three calendar months' notice in writing of such their desire; and in such case, and from and after the time named for that purpose in such notice, the services specified under the head Route No. 1 in the First Schedule hereunder written shall no longer be performed, and in lieu of such services there shall be substituted the services specified in the Second or Third Schedule hereunder written, as the case may be ; and except as herein otherwise expressly provided, all the provisions of this Agreement shall thereafter apply to the last-mentioned services in the same manner in all respects as if the services specified in Route No. 1 of the said First Schedule had been omitted therefrom, and the services specified in the said Second or Third Schedule, as the case may be, had been inserted in the place thereof : Provided always that the amount of the consideration or subsidy to be paid to the Company as hereinafter provided shall not be increased or diminished by reason of the substitution aforesaid : And provided also that in the event of the substitution aforesaid the periods of time within which the Company ought irLobedience to this Agreement to convey the mails from Southampton to Bombay and from Bombay to Southampton respectively, shall, in case Plymouth be adopted, be decreased in proportion to the diminished distance, and in case Liverpool be adopted be increased in proportion to the increased distance. 14. If at any time or times the Postmaster-General shall desire to alter the particular days, times, or hours of departure from and arrival at any of the ports or places to or from which Her Majesty's mails are for the time being to be conveyed under this Agreement, he shall be at liberty so to do on giving three calendar months' notice in writing of such his desire to the Company, provided such alterations do not necessitate an increase of speed. 15. If at any time or times the Postmaster-General shall desire otherwise to modify the services hereby agreed to be performed (as, for example, to increase or decrease the frequency of the conveyance of mails between any of the ports or places to or from which such mails are to be conveyed under this Agreement, or to extend the conveyance of such mails to any other ports or places not specified in this Agreement, or to discontinue the conveyance of such mails to or from any port or place specified in this Agreement), he shall be at liberty so to do on giving reasonable notice to the Company and on paying to them for such increased or extended services such further consideration, and in the event of the services hereby agreed to be performed being reduced, on his paying to them such reduced consideration as may in either of such cases be mutually agreed upen between the Company and the Postmaster-General, or, failing such mutual agreement, by arbitration, in the manner hereinafter provided. 16. The particular days, times, and hours of departure from and arrival at any of such ports or places or other services (if any) which may be appointed by'any alteration under the two preceding clauses, or either of them shall for the time being be deemed to be the days, times, and hours of departure and arrival of mails and other services under this Agreement, and shall be observed and kept by the Company accordingly. 17. If on any outward voyage commencing at Brindisi the Company shall fail to deliver Her Majesty's mails at any port of destination, whether the same be Bombay, Calcutta, Point de Galle, or Shanghai, for twelve hours or more after the time at which the same ought to be delivered according to the provisions of this Contract, which shall for the time being be in force, then and in every such case the Company shall forfeit and pay to Her Majesty, her heirs and successors, the sum of £100 for every complete period of twelve hours during which the delivery of such mails shall be delayed beyond the time at which the same ought to be delivered as aforesaid: Provided always that the payment of any such penalty as aforesaid shall not be enforced against the Company if it be shown by them to the satisfaction of the Postmaster-General that the delay has arisen from damage to the vessel or the machinery thereof. 18. If on any homeward voyage from Bombay or Point de Galle to Southampton the Company

P.—2.

8

shall fail to deliver Her Majesty's mails at Southampton for twelve hours or more after the time at which the same ought to be delivered according to the provisions of this contract which shall for the time being be in force, then and in every such case the Company shall forfeit and pay to her Majesty, her heirs and successors, the sum of £100 for every complete period of twelve hours during which the delivery of such mails shall be delayed beyond the time at which the same ought to be delivered as aforesaid: Provided always that the payment of any such penalty as aforesaid shall not be enforced against the Company if it bo shown by them to the satisfaction of the Postmaster-General that the delay has arisen from damage to the vessel or the machinery thereof. 19. If on any homeward voyage from Bombay, Calcutta, Shanghai, or Point de G-alle to Brindisi, the Company shall fail to deliver Her Majesty's mails at Brindisi for twelve hours or more after the time at which the same ought to be delivered according to the provisions of this contract which shall for the time being be in force, then and in every such case the Company shall forfeit and pay to Her Majesty, her heirs and successors, the sum of £200 for every complete period of twelve hours during which the delivery of such mails shall be delayed beyond the time at which the same ought to be delivered as aforesaid: Provided always that the payment of any such penalty as aforesaid shall not be enforced against the Company if it be shown by them to the satisfaction of the Postmaster-General that the delay has arisen from damage to the vessel or the machinery thereof. 20. If on any voyage from Hong Kong to Yokohama, or from Yokohama to Hong Kong, or from Bombay to Shanghai, or from Shanghai to Bombay, the Company shall fail to deliver Her Majesty's mails at Yokohama or Hong Kong, Bombay or Shanghai, as the case may be, for twelve hours or more after the time at which the same ought to be delivered according to the provisions of this contract which shall for the time being be in force, then and in every such case the Company shall forfeit and pay to Her Majesty, her heirs and successors, the sum of £100 for every complete period of twelve hours during which the delivery of such mails shall be delayed beyond the time at which the same ought to be delivered as aforesaid: Provided always that the payment of any such penalty as aforesaid shall not be enforced against the Company, if it be shown by them to the satisfaction of the PostmasterGeneral that the delay has arisen from damage to the vessel or the machinery thereof. 21. Provided always, and it is hereby declared, that during the prevalence of the south-west monsoon ninety-six additional hours shall be allowed for the voyages from Bombay to Southampton, from Bombay to Brindisi, or from Calcutta to Suez, and from Shanghai to Bombay; and during the prevalence of the north-east monsoon ninety-six additional hours shall be allowed for the voyage from Bombay to Shanghai, and twenty-four additional hours shall be allowed for the voyage from Hong Kong to Yokohama, 22. If the Company fail to provide an efficient vessel at any of the several ports or places at which such vessel ought to be provided in accordance with the terms of this Agreement, ready to put to sea on and at the appointed day and hour, then and so often as the same shall happen, the Company shall forfeit and pay unto Her Majesty, her heirs and successors, the sum of £500, and also the further sum of £100 for every successive twenty-four hours which shall elapse until such vessel actually proceeds to sea on her voyage in pursuance of this Agreement: Provided always that the total amount of the penalties last aforesaid shall not in the aggregate exceed the part of the subsidy of £430,000 hereinafter made payable to the Company which shall be applicable to the voyage in respect of which default shall have been made by a sum greater than the sum of £1,000. 23. The Company shall, whenever required by the Postmaster-General so to do, receive and allow to remain on board of each of the said vessels while employed in the performance of this Agreement to the east of Suez, and also while remaining at Suez or at any port or place east of Suez, and whether such vessel shall be with or without mails on board, an officer in Her Majesty's Navy, to be appointed by the Postmaster-General, to take charge of the said mails, and also a servant of such officer (if required), and every such officer shall be recognized and considered by the Company, their officers, agents, and seamen, as the agent of the Postmaster-General in charge of mails, and as having full authority in all cases to require a due and strict performance of this Agreement on the part of the Company, their officers, servants, and agents, and to determine (so far as relates to the levying of penalties) every question whenever arising relative to proceeding to sea or putting into harbour, or the necessity of stopping to assist any vessel in distress or to save human life ; and the decision of such officer as aforesaid shall in every such case be final and binding on the Company, unless the PostmasterGeneral, on appeal by the Company, thinks proper to decide otherwise : Provided, however, that the words "to determine every question " shall not confer upon such officer the power of control over the commander of the vessel conveying the said mails. 24. If the Postmaster-General at any time or times thinks fit so to do, he shall be at liberty to substitute for such naval officer a civil officer in the service of the Post Office to have charge of the said mails; and thereupon, and in every case in which a civil officer shall be appointed to be in charge of mails, such last-mentioned officer shall be received and bo allowed to remain on board each of the t said vessels as hereinbefore provided with respect to any such naval officer; but when any civil officer in the service of the Post Office shall be in charge of the said mails, his duties shall be confined to the Post Office business. 25. A suitable first-class cabin, with appropriate bed, bedding, and furniture, shall at the cost of the Company bo provided and appropriated by them for the exclusive use and accommodation of every such naval or civil officer, and every of the said officers shall be victualled by the Company as a chief cabin passenger, without any charge either for his passage or victualling. 2(5. The Company shall also receive and allow to remain on board each of the said vessels while employed in the performance of this Agreement to the east of Suez, and also while remaining at Suez or at any port or place east of Suez, and whether such vessels shall be-with or without mails on board, in addition to the officer in charge of tho mails, such a number of officers in the service of the Post Office as shall be reasonably required for the purpose of sorting and making up the mails conveyed or to be conveyed by such vessel, and shall provide suitable accommodation and victualling for such additional officers, either as chief cabin passengers or as fore cabin passengers, at the option of the said Postmaster-General.

9

E.—2

27. The Company shall at their own cost provide on each of the vessels to be employed under this Agreement a separate and convenient room for the convenient and secure deposit of the mails under lock and key, and shall also at the like cost (if and when they shall be required so to do by the said Postmaster-General) erect and provide on each of such vessels employed under this Agreement to the east of Suez a separate and convenient room for sorting and making up the said mails, and shall provide in such room all such furniture, lamps, fittings, and other conveniences as shall be necessary or convenient for the purpose of sorting and making up the said mails, and all such furniture, lamps, fittings, and other conveniences shall be from time to time cleansed and kept in repair, and the oil for the lamps supplied, by the servants and at the cost of the Company, and the services of the crew of every such vessel shall from time to time be given in the conveyance of the mails between the mailroom and the sorting-room. 28. At each port or place where the said mails are to be delivered and received, the officer having charge of the mails shall, whenever and as often as by him shall be deemed necessary for the public service, and either with or without his assistant or servant, be conveyed on shore and also from the shore to the vessel employed for the time being in the performance of this Agreement, together with or (if such officer shall consider it necessary for the purposes of this Agreement so to do) without mails, in a suitable and seaworthy boat of not less than four oars, to be furnished with effectual covering for the mails, and properly provided, manned, and equipped by the Company. 29. The master or commander of each of the said vessels employed in the performance of this Agreement to the west of Suez, and in all cases where the officer or other person appointed to have charge of the mails shall be absent the master or commander of each of the said vessels employed in the performance of this Agreement to the east of Suez, shall without any remuneration (other than the sum herein provided to be paid to the Company) take due care of, and the Company shall be responsible for the receipt and delivery of, the said mails, and each of such masters or commanders shall make the usual declaration or declarations required or which may hereafter be required by the Postmaster-General in such and similar cases, and furnish such journals, returns, and information to and perform such services as the Postmaster-General or his agents may require, and every such master or commander or officer duly authorized by him having the charge of mails shall himself, immediately on the arrival at any of the said ports or places of any such vessels, deliver all mails for such port or place into the hands of the Postmaster or other person at such port or place whom the PostmasterGeneral shall authorize to receive the same, receiving in like manner all the return or other mails to be forwarded in due course. 30. The Company shall not, nor shall any of the masters of any of the vessels employed or to be employed under this Agreement, receive or permit to be received on board any of the vessels employed under this Agreement any letters for conveyance other than those duly in charge of the said naval officer or other person authorized to have charge of the said mails, or which are or may be privileged by law, nor any mails for conveyance on behalf of any colony or foreign country, without the consent of the Postmaster-General; and in case of any such default respectively, the Company shall be liable to be proceeded against for breach of this Agreement. 31. The Company and all commanding and other officers of the vessels employed in the performance of this Agreement, and all agents, seamen, and servants of the Company, shall at all times punctually attend to the orders and directions of the Postmaster-General, his officers or agents, as to the mode, time, and place of landing, delivering, and receiving mails. 32. The Company shall and will, when and as often as in writing they or the masters of their respective vessels shall be required so to do by the said Postmaster-General or by any naval or other officers or agents acting under his authority (such writing to specify the rank or description of the person or persons to be conveyed and the accommodation to be provided for him or them), receive provide for, victual, and convey to and from and between any of the places to which any of the said vessels are to proceed in the performance of this contract (in addition to the naval officer authorized to have charge of the said mails, and to officers of the Post Office employed in connection with the mails conveyed by such vessel), any number of naval, military, and civil officers in the service of Her Majesty not exceeding eight in any one ship, with or without their wives and children, as chief cabin or first-class passengers, and any number of non-commissioned and warrant officers not exceeding four in any one ship, with or without their wives and children, as fore cabin or second class passengers, together with servants of both chief and fore cabin passengers, and any number of seamen, marines, soldiers, or artificers in Her Majesty's service, not exceeding ten in any one ship, with or without their wives and children, as deck or third-class passengers, to be always provided with effectual protection from rain, sun, and bad weather, and not exposed on deck without such competent shelter, and to have hammocks or bunks (subject to the approval of the Lords Commissioners of the Admiralty) placed between decks. 33. The passengers who shall be conveyed in pursuance of the last preceding clause (who are hereinafter designated Government passengers), with their families, shall be treated in no respect, whether as regards food, cabin, or other accommodation, or aught else, in a way inferior to that of ordinary passengers of the same class, or that required by the regulations of Her Majesty's Transport Service. The messing of the first and second class Government passengers shall include in each day an imperial pint of good sound bottled or draught ale or beer; and that of the first class, in addition, an imperial pint of good foreign wine, either port or white. The several classes of passengers shall mess in separate places, and medical attendance, medicine, and medical comforts, mess utensils and-fittings, cooking utensils, articles for table use and mess places, fuel, lights, requisite articles of bedding, and all other necessaries, shall be provided for them in like manner as for ordinary passengers of the like classes respectively. 34. The passage money for Government passengers and their families respectively shall be the same as that charged by the Company for ordinary passengers of a similar kind, and shall include all the particulars mentioned in the last preceding clause; and whenever any alterations of- rates for ordinary passengers may be made, the Postmaster-General and the Lords Commissioners of the Admiralty shall be immediately apprised of such alterations. 2—P. 2.

10

I\—2

35. Returns of the embarkation and disembarkation of all Government passengers shall be furnished to the Director of Transport Services immediately after the departure and arrival of each vessel. 36. Payments for passage money for Government passengers shall be applied for by invoices according to a form to be obtained from the office of the Director of Transport Services, and shall be made upon the production to such Director of the orders for the passages, together with a certificate under the hand of the commanding officer, specifying the number of the third-class passengers (men, women, and children) conveyed, with the ages and sexes of the latter, and stating the periods during which they have been respectively regularly supplied while on board with provisions, and also of a certificate under the hand of each first and second class passenger of his or her having been landed at the place of destination, and of having been properly accommodated and messed during the voyage, and specifying the dates from and to which they were so messed, computed from the first to the last dinner meal. 37. The Company shall convey for every Government passenger, free of charge, the same quantity of baggage (whether such quantity shall be estimated or ascertained by bulk or weight) which according to the regulations of the Company for the time being they convey free of charge for an ordinary passenger of the same class ; and freight shall be payable for any extra baggage of a Government passenger after the same rate as the freight payable according to the same regulations for extra bag. gage of an ordinary passenger of the same class. 38. The passage money for the wives and families of commissioned and civil officers, when not ordered to be conveyed at the public expense, shall be paid to the Company by the officers themselves. 39. In all cases where an officer in the civil, naval, or military service of Her Majesty, who may not be entitled tc a passage at the public expense, shall require a passage on board any of the vessels employed in the performance of this contract, the Company shall be bound, when they have room, to provide a passage for such officer in preference to private passengers, and shall charge no higher rate for such passage than is chargeable for an ordinary passenger. 40. The Company shall receive on board each of the vessels employed in the performance of this contract, and shall convey on behalf of the Lords Commissioners of the Admiralty, any small packages • which may be ordered for conveyance, and also (on receiving from the Postmaster-General or his officers or agents, or from the British naval officer in command of the station, two days' previous notice) shall receive on board any naval or other stores not exceeding 10 tons weight, or 15 tons of 40 cubic feet each in measurement, at any one time in any one vessel (packages and stores of a dangerous or damaging nature excepted, in accordance with the general regulations of the Company), and shall convey and deliver such small packages and stores at the lowest rate of freight charged by the Company for private goods of a similar character or description ; and the Company shall give immediate notice to the Postmaster-General and the Lords Commissioners of the Admiralty of any alteration in such rate of freight, and shall in all cases be responsible for the custody and safe and speedy delivery of such packages and stores. 41. And in consideration of the due and faithful performance by the Company of all the services hereby contracted to be by them performed, the Postmaster-General doth hereby covenant that there shall be paid to the Company (out of such aids or supplies as may from time to time be provided and appropriated by Parliament for that purpose), so long as they perform the whole of such services in manner and with such vessels as hereinbefore respectively provided, the sum of £430,000 per annum by equal quarterly payments on the Ist day of January, the Ist day of April, the Ist day of July, and the Ist day of October in every year, and so in proportion for any less period than a quarter. 42. On or as soon as conveniently may be after the Ist day of April and the Ist day of October in every year during the continuance of this Agreement, an account shall be made out of the amount payable by the Company to the Postmaster-General on account of penalties incurred by the Company; and if it shall appear by such account that any sum is due from the Company to the PostmasterGeneral, the same shall be forthwith paid by the Company to the Postmaster-General, or at his option may be deducted from the next quarterly payment due to the Company. 43. Except where otherwise expressly provided, none of the services performed or to be performed by the Company under this contract, shall entitle them to any remuneration beyond the said subsidy of £430.000 per annum, and such other sum or sums of money (if any) as are hereinbefore expressly made payable. And it is hereby further agreed and declared between and by the parties hereto as follows (that is to say), — 44. It shall be lawful for the Postmaster-General at any time and from time to time to delegate any of the powers vested in him by virtue of these presents to such person or persons as he shall think fit. 45. The Company shall undertake for themselves all arrangements relative to quarantine, as connected with the due and regular performance of the conditions of this contract. 46. The Lords Commissioners of the Admiralty shall at any time during the continuance of this contract, if they shall consider it necessary for the public interest, have power and be at liberty to purchase all or any of the said vessels at a valuation, or to charter the same exclusively for Her Majesty's service at a rate of hire to be mutually fixed and agreed on by them and the said Company ; but if any difference should at any time or times arise as to the amount of valuation or hire so to be paid, such difference shall be settled by arbitration in manner hereinafter provided; and the said Commissioners, in the case of hiring any such vessel, shall return the same to the said Company in the same state and condition as she was in at the time of any such hiring, reasonable wear and tear excepted ; and if any difference should arise upon that point, the same shall be settled in the same manner as the amount for the hiring is to be settled in case of difference. And it is further agreed that in case of such purchase or hire the service hereby contracted to be performed shall be performed by other vessels of the Company of a similar description to the vessel or vessels purchased or hired, if they can in due and proper time furnish them; and in the event of the said Company being allowed by the Postmaster.

11

P.—2.

General to continue to perform only a portion of the service, there shall be paid to the said Company such annual sum of money as shall be agreed upon by the said Postmaster-General and the said Company, and in case of their differing as to the amount, the difference to be settled by two arbitrators or an umpire, to be chosen respectively as aforesaid. 47. This contract shall commence on or as from the 15th day of August, 1874, and shall continue in force until the Ist day of February, 1880, and shall then determine, if the Postmaster-General shall, by writing under his hand, or under the hand of the Secretary or one of the Assistant Secretaries for the time being of the Post Office, have given to the Company, or if the Company shall have given to the Postmaster-General, twenty-four calendar months' notice that this contract shall so determine; but if neither the Postmaster-General nor the Company shall give any such notice, this contract shall continue in force even after the said Ist day of February, 1880, until the expiration of a twenty-four calendar months' notice in writing as aforesaid, which may be given by either of the parties hereto to the other of them, and which last-mentioned notice may be given at any time after the Ist day of February, 1878. 48. The contract dated the 6th day of August, 1870, and made between the Postmaster-General of the one part, and the Company of the other part, shall remain in force until the said 15th day of August, 1874, and no longer; and as from the last-mentioned date the same is hereby terminated and annulled. 49. If on the determination of this Agreement any vessel or vessels shall have started or shall start with the mails in conformity with this Agreement, such voyage or voyages shall be continued and performed and the mails be delivered and received during the same as if this Agreement had remained in force with regard to any such vessels and services ; and with respect to such vessels and services as last aforesaid, this Agreement shall be considered as having terminated when such vessels shall have reached their port or place of destination and such services shall have been performed; but the said Company shall not be entitled to receive any payment or compensation for the same. 50. All and every the sums of money hereby stipulated to be paid by the Company unto Her Majesty, her heirs and successors, shall be considered as stipulated or ascertained damages, whether any damage or loss has or has not been sustained, and shall and may be retained by the PostmasterGeneral out of any moneys payable, or which may thereafter become payable to the Company, or the payment may be enforced as a debt due to Her Majesty with full costs of suit, at the discretion of the Postmaster-General: Provided, however, that the payment by the Company of any sums of money (by way of penalties) shall not in any manner prejudice the right of the Postmaster-General to treat the failure (if any) on the part of the Company to provide a proper vessel, or to perform any voyage at or within the time for the time being appointed for the performance thereof, as a breach of this Agreement. 51. All notices or directions which the Postmaster-General, his officers, agents, or others are hereby authorized to give to the Company, their officers, servants, or agents, other than any notice of termination of this contract, may, at the option of the Postmaster-General, his officers, agents, or others, either be delivered to the master of any of the said vessels or other officer or agent of the Company in the charge or management of any vessel employed in the performance of this Agreement, or left for the Company at their office or house of business in London, or any other place, and any notices or directions so given or left shall be binding on the Company: Provided always that auy notice of termination of this contract shall be served on the Company, their officers, servants, or agents, at their office or last known office in London. 52. The Company shall not assign, underlet, or dispose of this Agreement, or any part thereof, without the consent of the Postmaster-General, signified in writing under his hand, or under the hand of the Secretary or one of the Assistant Secretaries of the Post Office; and in case of the same or any part thereof being assigned, underlet, or otherwise disposed of, or of any great or habitual breach of this Agreement, or any covenant, matter, or thing herein contained, on the part of the Company, their officers, agents, or servants, and whether there be or be not any penalty or sum of money payable by the Company for any breach, it shall be lawful for the Postmaster-General, if he shall think fit (and notwithstanding there may or may not have been any former breach of this contract), by writing under his hand, or under the hand of the Secretary or one of the Assistant Secretaries of the Post Office, to determine this Agreement without any previous notice to the Company or their agents, nor shall the Company be entitled to any compensation in respect of such determination, and such determination shall not deprive the Postmaster-General of any right or remedy to which he would otherwise be entitled by reason of such breach or any prior breach of this contract. 53. If at any time during the continuance of this Agreement, or after the determination thereof, any dispute shall arise between the parties hereto or their successors respectively, concerning any breach or alleged breach by or on the part of the Company of this Agreement, or the sufficiency of any such breach to justify the Postmaster-General in putting an end to the same, or concerning the amount of consideration to be paid to or allowed by the Company, as the case may be, for such altered services as hereinbefore in that behalf mentioned, or concerning any of the covenants, matters, or things herein contained, or in anywise relating thereto, and notwithstanding the power herein contained to determine this Agreement, and any execution or attempted execution of such power, such dispute shall be referred to two arbitrators, one to be chosen from time to time by the PostmasterGeneral and the other by the Company; and if such arbitrators should at any time or times not agreein the matter or question referred to them, then such question in difference shall be referred by them to an umpire to be chosen by such arbitrators before they proceed with the reference to them, and the joint and concurrent award of the said arbitrators, or the separate award of the said umpire when the said arbitrators cannot agree, shall be binding and conclusive upon both parties. 54. Any submission to arbitration in pursuance of this Agreement may be made a rule of any of Her Majesty's Courts of Record, pursuant to the statute in that case made and provided, on the application of either party. 55. In pursuance of the provisions contained in the Act of Parliament passed in the 22nd year of the reign of King George the Third, intituled "An Act for restraining any Person concerned in any

1?.—2

12

" Contract, Commission or Agreement made for the Public Service from being elected or sitting and " voting as a Member of the House of Commons," no member of the House of Commons shall be admitted to any share or part of this Agreement, or to any benefit to arise therefrom, contrary to the true intent and meaning of the said Act. ' 56. This Agreement shall not be binding until it has been approved by a resolution of the House of Commons. 57. And lastly, for the due and faithful performance of all and singular the covenants, conditions, provisoes, clauses, articles, and agreements hereinbefore contained, which on the part and behalf of the said Company are or ought to be observed, performed, fulfilled and kept, the said Company do hereby bind themselves and their successors unto our Sovereign Lady the Queen in the sum of £45,000 of lawful money of the United Kingdom to be paid to our said Lady the Queen, her heirs and successors, by way of stipulated or ascertained damages hereby agreed upon between the Postmaster-General and the Company, in case of the failure on the part of the Company in the due execution of this contract or any part thereof. In witness whereof the said Lord John Manners, Her Majesty's Postmaster-General, hath hereunto set his hand and seal, and the said Peninsular and Oriental Steam Navigation Company have caused their common seal to be hereunto affixed, the day and year first above written.

FIRST SCHEDULE. Kotjte No. 1. —Once a "Week. Through the Suez Canal. Prom Southampton to Bombay, calling at Gibraltar, Malta, Suez, and Aden, and back from Bombay to Southampton, calling at Aden, Suez, Malta, and Gibraltar. Eotjte No. 2. —Once a Week. From Brindisi to Alexandria, and back from Alexandria to Brindisi. Eoute No. 3. —Once in Eveet Two Weeks. From Suez to Calcutta, calling at Aden, Point do Galle, and Madras, and back from Calcutta to Suez, calling at Madras, Point de Galle, and Aden. Route No. 4.—Once in Eveey Two Weeks. From Bombay to Shanghai, calling at Point de Galle, Penang, Singapore, and Hong Kong, and back from Shanghai to Bombay, calling at Hong Kong, Singapore, Penang, and Point de Galle. Route No. 5. —Once in Eveet Two Weeks. From Hong Kong to Yokohama, and back from Yokohama to Hong Kong. SECOND SCHEDULE. Once a Week. From Plymouth to Bombay, calling at Gibraltar, Malta, Suez, and Aden, and back from Bombay to Plymouth, calling at Aden, Suez, Malta, and Gibraltar. THIRD SCHEDULE. Once a Week. From Liverpool to Bombay, calling at Gibraltar, Malta, Suez, and Aden, and back from Bombay to Liverpool, calling at Aden, Suez, Malta, and Gibraltar. John Mannees. Signed, sealed, and delivered by the above-named John James Robert Manners, Her Majesty's Postmaster-General, , . in the presence of \L°-) F. A. R. Langton, Private Secretary to the Postmaster-General, General Post Office, London. The Common Seal of the above-named Peninsular and Oriental Steam Navigation Company was hereunto affixed in the presence of P. D. Hadow, A William H. Hall, /tv *. / n J. R. Engldue, ( L .s.) Thomas Suthebland, ) Henet Hill, Assistant Secretary. W. J. Page, General Post Office, London.

13

P.—2.

Copt of Tbeasury Minute, dated Ist August, 1874. Mi Lords have again before them the contract, dated Bth July, 1874, between the PostmasterGeneral and the Peninsular and Oriental Steam Navigation Company, for the conveyance of the East India, China, and Japan mails. My Lords have also before them the minute of the Board of 13th July, 1874. These two papers have already been laid before the House of Commons. Their Lordships' attention is particularly directed to the Bth, 17th, 18th, 19th, and 20th clauses of the contract. Their Lordships have also before them an amended contract between the same parties, and for the same object, dated Ist August, 1874, in which words have been inserted in the clauses referred to, specifying more particularly the time to be allowed for passages between certain ports on the respective voyages, and providing that all the penalties payable under the amended contract shall be increased as provided, therein, and shall be absolute except in cases of shipwreck and damage to machinery. My Lords consider that the amendments proposed are advantageous to the Public Service, although they are aware that it was distinctly understood that the terms of the contract of Bth July, 1874, would be construed as binding the Company to the time-table now more specifically set forth. They are pleased, therefore, to approve of the amended contract now submitted to them, and they desire that a copy of the amended contract, together with copy of this minute, may be laid on the table of the House of Commons.

Memorandum: by the Postmaster- General relating to the foregoing Contract. The following are the only points in which the contract with the Peninsular and Oriental Steam Navigation Company of the Ist August, 1874, differs from the contract executed on the Bth July, 1874, and now on the table of the House of Commons. In clause 8, the number of hours to be allowed for the carriage of the mails over several of the routes, omitted in the first contract, are inserted in the second. In clause 11, the provisions with respect to stranding in the Suez Canal are made applicable to voyages out and home. In clause 19, the penalties imposed for failure to perform within the appointed time the voyages from Bombay or Point de Galle to Brindisi, are extended by the second contract to the voyages from Calcutta or Shanghai to Brindisi, and the amount of such penalty is in each case quadrupled. Further, the penalty is made absolute. Clause 20 in the second contract applies to the routes between Hong Kong and Yokohama, and between Bombay and Shanghai, the same quadruple penalty which is fixed by clauses 17 and 18 to other routes, and makes the penalty absolute. General Post Office, Ist August, 1874. John Manneks. By Authority : George Didsbubt, Government Printer, Wellington.—lB7s. Price 9d.]