The Old Whaling Days
Chapter XVI. — Tariff Disputes, 1834 to 1838
Tariff Disputes, 1834 to 1838.
It is not suggested that the same condition of things prevailed in the sperm as in the right whaling trade. It did not. In the sperm whaling, British—meaning by that term, fitted out from some port in the United Kingdom—and American vessels, did a very substantial part of the whaling, and Sydney and Hobart Town craft had to be content with a comparatively small, though rapidly increasing, portion. In the right whaling, and more especially in the bay whaling portion of it, as the earlier chapters have shown the reader, very little of the trade on the Southern New Zealand coast was carried on by British vessels. With but few exceptions we have had to deal, up to the present time, with vessels fitted out from, and owned or chartered at, Sydney and Hobart Town. It was the year 1834 which saw the first British and American vessels taking part in the trade.
Why this condition of things prevailed is not difficult to explain. As the whale was persecuted by its captors it left the highways of commerce and sought safety in the less disturbed waters of the South Pacific, far removed from London and New Bedford—the whaling headquarters of Britain and America. Contemporaneous with this removal of the theatre of whaling, came the growth of New South Wales, and the establishment of the cities of Sydney and Hobart Town as ports from which whalers could be fitted out with the greatest ease. As these two ports were much closer to the field of operations than their Atlantic competitors, Australian vessels could spend a longer period of their voyage on the whaling grounds, and it was only a question of time, therefore, for the latter to do more than hold their own in the South Pacific oil trade.
When we come to institute a comparison between page 261 British and American whaling we are face to face with a very different proposition. The headquarters of both were similarly situated in regard to the whaling grounds, and both had to undertake the long voyage going and returning. Both had generations of whalers and whaling experience to draw from. In spite of these resemblances, however, there was really no comparison between the work done by the two countries in the New Zealand whaling trade. The British whaler never was a serious rival of the American. What the cause was the author is not prepared to say, but the fact is established by the number of vessels engaged in the trade, and that it was realised by the British Authorities is shown by the attempts made to place the two countries on an equal footing.
Amongst the schemes put forward to bring about a better state of things, the one which met with most favour was to place on the Statute Book a preferential tariff in favour of whaling products from British fishing. It was pointed out that Britain was the greatest market for whale oil in the World, and, if a substantial duty were imposed upon oil produced by foreigners as against oil produced by British subjects, it would not be profitable to employ foreign men and ships in the trade, and Britain would come into her own.
As a result, legislation (3 and 4 Wm. IV., c. 52) was passed providing that train oil, blubber, spermaceti oil, and head matter, the produce of fish or creatures living in the sea, taken and caught by the crews of British ships, and imported direct from the fishery, or from any British possession, in a British ship, must pay a duty of one shilling per tun. If the above were the product of fish or creatures living in the sea, of foreign shipping, it must pay a duty of £26 12s. per tun. A declaration was required from the master or shipper. The legislation also provided that, to import direct, the vessel importing must have cleared from the United Kingdom, the Channel Islands, or Man, otherwise the produce must be imported from a British Possession and accompanied by a certificate by the page 262 shipper that it was the produce of fish or creatures living in the sea, taken wholly by British vessels. This legislation was expected to act in the interests of British whaling. What we are interested in is not whether it did what the author of the legislation intended it should do, but what Southern New Zealand questions arose under the legislation, and what effect they produced on our bay whaling trade. We will therefore discuss, in the order in which they arose, the cases affecting Southern New Zealand which came up for settlement by the Board of Customs, London.
The Otago Fish, 1834.
This does not refer to whaling, but the same legislation applied to other produce of New Zealand waters, and it is dealt with here for convenience of arrangement of subject matter.
In September, 1834, the Customs of Port Louis, Mauritius, advised London that a quantity of salt fish, “the produce of New Zealand and imported into New South Wales by the Lucy Ann,” had been imported into the Mauritius in the Sovereign. This was part of a cargo of 23 barrels of salt fish which the Lucy Ann landed at Sydney from Weller's Establishment at Otago, on 22nd April of that year, consigned to George Weller. The consignees were unable to produce any certificate of how the fish come to be caught, and the cargo was accordingly seized by the Customs Authorities at Port Louis.
Pending the arrival of the certificate demanded, it was arranged that the fish should be landed and sold in the presence of a Customs officer, and the proceeds deposited in the King's Chest. This was done, and a sum of £18 16s. 6d. paid into the Treasury. In October, London was advised, and wrote Sydney regarding the omission. The Mauritius Authorities in due course procured the certificate, and handed over the money. When the Sydney Collector replied to the London Office he stated that the fish had been “caught by British subjects who have an page 263 Establishment at New Zealand, where they reside during part of each year.”
At once it will be seen what a liberal interpretation the Authorities were prepared to put upon the legislation. The expression “taken and caught by the crews of British ships” was being stretched to cover “caught by British subjects who have an Establishment at New Zealand, where they reside during part of each year.” If this be justified on the grounds of coming within the spirit of the Act, though not fitting in with local conditions, it may be pointed out that the fishery establishment at Otago was stationed amongst a large Maori population, many of whom were in the employ of Weller, and were by him engaged whaling and fishing, for which latter occupation they were specially well fitted. Our knowledge of the constitution of Weller's Establishment—that one-half of his staff were Maoris—would indicate to us that the fish were probably caught by foreigners. Under no circumstances could Weller's Establishment be called a British vessel.
It is evident that the requirements which commonsense dictated at Sydney enabled a wholesale evasion of the terms of the preferential tariff to take place. So far as the encouragement of British trade was concerned all that the tariff did was to place a hindrance—perhaps a small one—in the way of trade between New Zealand and Port Louis. British trade was not helped. The carrying trade certainly suffered.
Weller's Application, 1834.
After the Wellers had found that their Otago station was going to prove a fairly profitable venture, and before the troubles with the Maoris during the season of 1834, they decided to try the experiment of shipping the oil direct to London instead of through Sydney, and accordingly the New South Wales member of the firm made an application to the Collector of Customs at Sydney to ascertain exactly the position. So uncertain was the Sydney view of page 264 the meaning of 3 and 4 Wm. 4, c 52 that Weller's query had to be referred to London.
In the statement of the case sent, Weller's Establishment is described as wholly British, “the men the gear and the boats and the party” being furnished with provisions from Sydney. That was not correct, as one-half of the men were Maoris, who were not British subjects. Mr. Weller's request was stated to be “whether if he sends from home a British vessel, to take on board and carry direct to England the oil thus cured, and obtain from the Resident at the Bay of Islands, a certificate that it is so caught it will be admitted as English.” The idea would seem to be to provision the gang from England, and take the oil back, or combine open sea whaling with the working of the gang, as was done by some of the other Australians, only that they operated from Sydney. Probably the expression “from home” was used to keep within the terms of the Act, which stated that the ship must clear from the United Kingdom.
The London reply was that, as New Zealand was not a British possession, oil from there to England would be liable to a duty of £26 12s. This reply was conveyed to Weller under date 29th September, 1835, and prevented him carrying out his scheme of direct exportation.
In this case, the preferential tariff proved injurious to British trade. The oil was destined for London, and the law prevented it being delivered there at as low a cost as it otherwise could. It compelled it to be sent to Sydney and then on to its destination. The same law prevented the supplies for the station being sent from London, and compelled them to be bought at a more expensive figure in Sydney. All the time this legislation was supposed to be in the interests of British trade.
Following on the receipt of the letter of advice from London, a peculiar mistake was made by the Sydney officials. They appear to have entirely lost sight of the fact that the oil from New Zealand whaling stations was being exported to London under the provisions of an Act page 265 which allowed it, if coming from a British Possession, to come in under a certificate that the whales had been taken by the crews of British vessels. The intermediate stage of the New Zealand oil going to Sydney, and there being reshipped, appears to have been lost sight of, and the London letter was read to mean that oil taken on shore at New Zealand could not be landed in London without paying the enormous duty of £26 12s.
The Customs Officers realized at once that their interpretation of the London letter meant death to New Zealand whaling trade, and they accordingly reported, for the benefit of the London Office, upon the system which prevailed at their port, of sending to England oil which had been obtained at New Zealand—not a British Possession. Anticipating that when the Board of Customs found out that the oil was New Zealand got they would refuse to receive it any longer as British, the Governor was advised of what steps were being taken, and it was suggested to him that as this would mean a great loss to the young Colony, he might write the Lords of the Treasury on the matter.
The reader will bear in mind that the Customs Officers were Imperial men, and communicated with, and received instructions from, the Customs Officers in London, and not the Governor of New South Wales. The following letter was then addressed to the Board of Customs:—
Decr. 22nd 1835.
Referring to Your Honor's Order of the 30th May last No. 22 we think it necessary to report that the several British Establishments alluded to therein as described in our communication of the 25th October, 1834. No. 49 have been carrying on the whale fishery at New Zealand for the last ten years and during the whole of that time the oil, after being brought up here, was shipped for the United Kingdom as British caught and cured.
This system was found in existence at the time Mr. Cotton and Mr. Lauga took charge of the page 266 Department, and was allowed by them and by ourselves up to the present moment. But the above Order has entirely altered our opinion as to the propriety of such proceedings, and we therefore, hasten to lay the case before your honors, for instructions as to our future guidance on this head. We cannot exactly trace the foundation of these Establishments: but we have reason to think that, independently of the great benefit they were to a young Colony like this and to the parties themselves, they arose in consequence of the peculiar footing so similar to that of a British Possession on which New Zealand was placed by His Majesty's Government, as for a certain number of years, the Flax and Spars of the Islands were admitted into the United Kingdom free of all duty, in like manner, and for the like period with the produce of the Colony, and besides recognising the British resident sent from hence to that place, the Lords of the Treasury allowed their vessels to sail under a British Flag.
Taking all these circumstances into consideration and the Fish being decidedly caught by British subjects it was not recollected that being boiled or manufactured into oil on the shores of a country not British it could not, accordingly to the strict letter of the Law, be considered as British cured.
So much capital has however been invested in these speculations so long countenanced and so great a sensation has been created amongst the merchants by the mention of our intention to write home upon the subject that although we fear we have been acting in error, we do not feel justified in at once refusing to certify to the oil which may be shipped (in which view of the case we are borne out by His Excellency the Governor) as there is not consumption here for a twentieth part of what is caught, and would in consequence be entailed on the parties by such a measure. Neither can they break up their page 267 Establishments at a moment's notice, and we therefore venture to submit that should it be decided that the importation of this oil as British caught is illegal time may be given to the parties after the receipt of any order your Honors may be pleased to send to withdraw their Establishments and some provision be made for receiving at the low rate of duty such oil as may at that time be caught.
J. Gibbes Collr.
B. Lauga Contr.
The Board of Customs, London, when replying, very clearly stated the law upon the question and pointed out that where oil was produced by British subjects at New Zealand it could be imported into Sydney, and, after being landed there, could be re-exported to London under the provisions of 3 and 4 Wm. IV. c. 52. They also pointed out that the question raised on Mr. Weller's application was quite different to the one now under consideration.
Their next step showed how little the Sydney officials understood of the Act they were administering. They could not understand, they said, how, if it was unlawful to import oil from one Establishment direct to London it could be lawful for four or five to do it indirectly viâ Sydney. Their letter, in fact, was a blunt suggestion that the London Authorities had backed down.
This was too much for Official London, and a carefully worded explanation of the whole case was concluded in the following words:—
“We further acquaint you that had you sufficiently attended to our Orders of the 30th May, 1835, No. 22, and the 28th July, 1836, No. 54, which we consider contained explicite instructions for your government, you could not have failed to observe, that oil sent direct from New Zealand to the United Kingdom, whether taken by one or more British subjects, could not upon its arrival have been admitted as British taking, and that it must have been in the first instance sent to Sydney to be there page 268 landed and subsequently shipped for exportation under the superintendence of the proper officers to entitle it to be admitted at the low duty upon its arrival in the United Kingdom.
B. B. Dean.
Sydney, New South Wales.
This letter was dated Custom House, London, 23rd August, 1837.
As the Sydney officials were under the control of the London Board the above admitted of no reply and the correspondence closed. Whether the whaling station owners were ever told that the whole trouble was due to official ignorance is not known.
It will be noticed that the whole position of the exemption from duty is based upon the assumption that those who obtained the oil were British subjects, a position which did not exist in New Zealand owing to the general employment of Maoris at the settlements. In no case were the men of the stations members of the crews of British vessels. The tariff provided, if put into operation literally, would have killed the trade, and it is satisfactory to notice that there was sufficient legal ability in England, if not in Australia, to read an interpretation into the statute which rendered many of its injurious effects quite nugatory.
The Cloudy Bay Oil, 1835.
On 6th January, 1835, the schooner Fortitude, under the command of Robert Mackay, arrived at Sydney from the Bay of Islands, and three days later, Thomas Jeffry, landing waiter, reported to the Collector of Customs that he had seized on board of her 21 casks of black whale oil and 1 of sperm, in consequence of information received from New Zealand to the effect that the oil was not British caught, as alleged, but had been taken by five Englishmen serving on the American whaler Erie. In addition to the page 269 information sent him preparatory to seizure, the casks in which the oil was contained were of American make.
The oil, it appears, was owned by James R. Clendon, who had purchased it at the Bay of Islands where it had been brought in the American whaler Erie from Cloudy Bay. It was alleged that the oil had been taken in Cloudy Bay by a party of Englishmen under John Moffat Chisholm, and that they had simply utilized the services of the Erie to get the oil transported to the Bay of Islands. In regard to the casks being of American make, it was urged that such fact alone did not warrant seizure, and application was made for permission to tranship the oil to casks of British make. It was also stated that a number of casks had been imported by the Tybee, of Salem, U.S.A., and after paying duty, had been forwarded to New Zealand with biscuits, to be returned with oil. Hence the use of American casks. If the oil could be classified as British, the duty would be £7 10s. If Foreign, £150. The loss if the oil was declared foreign would be £142 10s. The certificate produced under the Act was from the British Resident, and read thus:—
I certify that John Moffat Chisholm, a British subject, has this day appeared before me and declared that Twenty Casks containing about 3500 Three thousand five hundred Gallons more or less of Black Oil, which has been shipped at this place on board the Schooner Fortitude bound for Sydney, was taken by himself and five other British subjects at Cloudy Bay New Zealand and is therefore “British caught.”
Bay of Islands
New Zealand20 Decr. 1834.
Information was given in Sydney to the Customs Officers that the oil was American caught. It was stated that the Erie was manned partly by Englishmen, and that the oil, or its equivalent, though taken by five Englishmen, page 270 was taken by five men who, when they took it, were serving on board the American ship.
The oil was sold to a Mr. F. Mitchell, of the Kings Wharf, Sydney, and that gentleman applied for possession of it. On giving security to abide by the decision of the Board of Customs, London, the proceedings which were being commenced in the Vice-Admiralty Court were stayed, and the oil handed over. In advising London of the steps taken it was stated that further evidence would be obtained and forwarded.
On being applied to, Mr. Busby was unable to give any further information, and the Sydney authorities had reluctantly to advise London to that effect. In reply they were directed to cancel the bond.
From information handed in at a later date it was evident that Chisholm was whaling for the Erie in Cloudy Bay, and used American boats and tackle. He and his gang were paid according to lay, under an agreement made at the Bay of Islands before they came down. It was quite true that British subjects had procured the oil, but in so doing they were in American employment. The mistake made in Sydney was in taking the case out of the Vice-Admiralty Court and referring it to London for decision. At a trial the whole of the facts would have come out, the Court would have decided whether it was British or Foreign, and the oil would probably have been forfeited. The same thing would have resulted if the Declaration, instead of allowing the men to say that the oil was British caught, had stated how it was taken and left the officers to decide under what heading it should come in.
Doubtless great quantities of oil evaded the preferential tariff barrier in this way, and the only thing to be regretted is that the dishonest trader would evade the law and prosper, while the honest would observe it and suffer, all the while England paying dearer for her oil. The Erie's oil was British seamen's wages, and the preferential tariff was robbing the whaler of a substantial portion of his remuneration. In all the cases under this legislation which we have page 271 investigated not one can be said to have benefited British trade, though the loss was cut down to a minimum by a very liberal interpretation of the statute.
The Greenland Whalers' Complaint, 1838.
Whalebone, under the designation of whale fins, came under the legislation providing preferential duties in favour of British trade. The duty provided in this case was £1 per ton if British caught, and £95 per ton if Foreign.
In 1838 a Petition was presented to the Lords of the Treasury, from the merchants and shipowners interested in the Greenland and Davis Strait whaling, praying for an investigation of the condition of things prevailing in the whaling trade of the South Pacific. It stated that for a considerable time the signatories had seen whalebone received into London as British caught which bore evident marks of being American or Foreign, but, because it was accompanied by a British Certificate, it escaped a duty of £94 per ton. The petitioners suggested that British ships met those of America on the high seas and bought the whalebone, which was incorporated in the cargo and covered by the certificate. This applied to ships from Sydney and Hobart Town. The petitioners stated that the proportion of whalebone in the North and South should agree, while in the North 1 to 2 tons of bone were procured with every 100 tuns of oil, in 1837 the total importation from the South Pacific showed 5 tons of bone to 100 tuns of oil, by which alone £12000 of duty was lost. They asked that where the bone exceeded 2 per cent, of the oil it should be refused admission.
Copies of the Petition were at once forwarded to the Collectors of Customs at Sydney and Hobart Town for investigation.
The Sydney evidence challenged the statement that 1 to 2 tons of bone was a fair average, and contended that not less than 5 tons to every 100 tuns of oil was the proper amount.page 272
The various elements which affected the proportion of oil and bone were stated to be:—
Whales were sometimes killed for the bone only, there being no casks for saving the oil.
Whales were sometimes found so long dead, either afloat or stranded on the shore, that only the bone could be saved.
The latter was very common in New Zealand, as great numbers of vessels were engaged, and the wounded whales, died and were washed ashore.
The Hobart Town investigations were more complete than the Sydney, and the replies of the different whaling firms went to establish the following propositions:—
The whales when they first arrived were fat and yielded less than 5 per cent, of bone to oil. If they came late, and remained to September and October, they got much thinner and the proportion of bone to oil was more than 5 per cent.
Entire heads were sometimes lost through stress of weather, and then no bone at all was secured.
All but the bone was sometimes lost, by the “fish” becoming putrid, or being driven ashore out of reach.
Some oil was consumed in the Colonies, but all the bone was exported. This increased the proportion of bone.
The experience of 3 years with one owner, and 7 years with another, was that 5 per cent, of bone was procured.
One owner gave his figures for the New Zealand trade for the year 1835, as 7 tons of bone to 120 tuns of oil.
Dealing with the charge of British vessels purchasing whalebone from American, the Hobart Town Customs considered that the belief of the Petitioners on this point was wholly without foundation, as the crews were paid by “lays,” which were a substantial part of the value of the bone, and they did not consider that the crews would give-up their rights to their share of all bone procured, which would make it too costly for the owners.page 273
In the light of the Sydney and Hobart Town information supplied to London, it is quite certain that the proportion of bone to oil was not from 1 to 2 per cent. The evidence everywhere was that it was about 5, and the figures of Weller's Establishment at Otago showed 1 to 21 or very nearly 5. But while that was so, it is equally certain that bone was purchased from the Americans. In the New Bedford Library, in the log of the American whaler, Tuscaloosa, for 1836, and while the vessel was whaling in Cloudy Bay, the following entries are to be seen:—
Sunday, August 28, 1836.
“Sold 200lbs. whale Bone to an English Brig.”
Wednesday, August 31, 1836.
“Sold 250lbs. bone to an English ship.”
No argument or reasoning can overcome the evidence of such entries. The English vessels purchased the American whalebone when they wanted to, and probably got over the difficulty with the men by giving them a small allowance. After a long voyage the prospect of getting home sooner would prepare the crew to allow the vessel to be at once filled, provided a correspondingly early start was made for home. The English Petitioners had not definite enough information at hand and they made the mistake of setting out to prove too much.
There might have been added to the reasons given above which determined the proportion of bone to oil, the case of whales being driven ashore and the natives securing, the bone and selling it to the whaling ships. This was a common practice. The capture of the Lord Rodney by the natives was preceded by negotiations for the purchase of whalebone which the natives had procured, and whalebone also figured at the capture of the Active shortly afterwards. This was all Foreign bone, quite as much as if bought from the Americans, but it all seems to have been put away as British bone, and covered by the one certificate.
Whether this preferential tariff that we have discussed, had the effect of reducing American competition, can be gathered by a perusal of the chapters which deal with the American whalers on our coast.