With such persuasive reiteration, Lord Caernarvon, in the name and at the instance of Sir E.B.  Lytton, insisted that the wisest and most dignified course would be found in an appeal to and a decision by the Judicial Committee of the Privy Council, with the concurrence alike of Canada and the Hudson’s Bay Company.  In conclusion, the Company were once more assured, that, if they would meet Sir E.B.  Lytton in finding the solution of a recognized difficulty, and would undertake to give all reasonable facilities for trying the validity of their disputed charter, they might be assured that they would meet with fair and liberal treatment, so far as her Majesty’s government was concerned; but if, on the other hand, the Company persisted in declining these terms, and could suggest no other practicable mode of agreement, Sir E.B.  Lytton held himself acquitted of further responsibility to the interests of the Company, and proposed to take the necessary steps for closing a controversy too long open, and for securing a definitive decision, due alike to the material development of British North America and to the requirements of an advancing civilization.

The communication of Lord Caernarvon stated in addition, that, in the case last supposed, the renewal of the exclusive license to trade in any part of the Indian territory—­a renewal which could be justified to Parliament only as part of a general agreement adjusted on the principles of mutual concession—­would become impossible.

These representations failed to influence the Company.  The Deputy-Governor, Mr. H.H.  Barens, responded, that, as, in 1850, the Company had assented to an inquiry before the Privy Council into the legality of certain powers claimed and exercised by them under their charter, but not questioning the validity of the charter itself, so, at this time, if the reference to the Privy Council were restricted to the question of the geographical extent of the territory claimed by the Company, in accordance with a proposition made in July, 1857, by Mr. Labouchere, then Secretary of State for the Colonies, the directors would recommend to their shareholders to concur in the course suggested; but must decline to do so, if the inquiry involved not merely the question of the geographical boundary of the territories claimed by them, but a challenge of the validity of the charter itself, and, as a consequence, of the rights and privileges which it professed to grant, and which the Company had exercised for a period of nearly two hundred years.  Mr. Barens professed that the Company had at all times been willing to entertain any proposal that might be made to them for the surrender of any of their rights or of any portion of their territory; but he regarded it as one thing to consent for a consideration to be agreed upon to the surrender of admitted rights, and quite another to volunteer a consent to an inquiry which should call those rights in question.