VII.—CONTRACTS

That the Court of Directors of the East India Company had laid down the following fundamental rules for the conduct of such of the Company's business in Bengal as could be performed by contract, and had repeatedly and strictly ordered the Governor and Council of Port William to observe those rules, viz.: That all contracts should be publicly advertised, and the most reasonable proposals accepted; that the contracts of provisions, and for furnishing draught and carriage bullocks for the army, should be annual; and that they should not fail to advertise for and receive proposals for those contracts every year.

That the said Warren Hastings, in direct disobedience to the said positive orders, and, as the Directors themselves say, by a most deliberate breach of his duty, did, in September, 1777, accept of proposals offered by Ernest Alexander Johnson for providing draught and carriage bullocks, and for victualling the Europeans, without advertising for proposals, as he was expressly commanded to do, and extended the contract for three years, which was positively ordered to be annual,—and, notwithstanding that extension of the period, which ought at least to have been compensated by some advantage to the Company in the conditions, did conclude the said contract upon terms less advantageous than the preceding contract, and therefore not on the lowest terms procurable. That the said Warren Hastings, in defiance of the judgment and lawful orders of his superiors, which in this case left him no option, declared, that he disapproved of publishing for proposals, and that the contract was reduced too low already: thereby avowing himself the advocate of the contractor, against whom, as representative of the Company, and guardian of their interests, he properly was party, and preferring the advantage of the contractor to those of his own constituents and employers. That the Court of Directors of the East India Company, having carefully considered the circumstances and tendency of this transaction, condemned it in the strongest terms, declaring, that they would not permit the contract to be continued, and that, "if the contractor should think himself aggrieved, and take measures in consequence by which the Company became involved in loss or damage, they should certainly hold the majority of the Council responsible for such loss or damage, and proceed against them accordingly."—That the said Warren Hastings, in defiance of orders, which the Directors say were plain and unequivocal, did, in January, 1777, receive from George Templer a proposal essentially different from the advertisement published by the Governor-General and Council for receiving proposals for feeding the Company's elephants, and did accept thereof, not only without having recourse to the proper means for ascertaining whether the said proposal was the lowest that would be offered, but with another actually before the board nearly thirty per cent lower than that made by the said George Templer, to whom the said Warren Hastings granted a contract, in the terms proposed by the said Templer, for three years, and did afterwards extend the same to five years, with new and distinct conditions, accepted by the said Warren Hastings, without advertising for fresh proposals, by which the Company were very considerable losers: on all which the Court of Directors declared, "that this waste of their property could not be permitted; that he, the said Warren Hastings, had disregarded their authority, and disobeyed their orders, in not taking the lowest offers"; and they ordered that the contract for elephants should be annulled: and the said Directors further declared, that, "if the contractor should recover damages of the Company for breach of engagement, they were determined, in such case, to institute a suit at law against those members of the board who had presumed, in direct breach of their orders, to prefer the interest of an individual to that of the Company."—That the said Warren Hastings did, in the year 1777, conclude with – Forde a contract for an armed vessel for the pilotage of the Chittagong river, and for the defence of the coast and river against the incursions of robbers, for the term of five years, in further disobedience of the Company's orders respecting the mode and duration of contracts, and with a considerable increase of expense to the Company. That the farming out the defence of a country to a contractor, being wholly unprecedented, and evidently absurd, could have no real object but to enrich the contractor at the Company's expense: since either the service was not dangerous, and then the establishment was totally unnecessary, or, if it was a dangerous service, it was evidently the interest of the contractor to avoid such danger, and not to hazard the loss of his ship or men, which must be replaced at his own expense, and therefore that an active and faithful discharge of the contractor's duty was incompatible with his interest.—That the said Warren Hastings, in further defiance of the Company's orders, and in breach of the established rule of their service, did, in the year 1777, conclude a contract with the master and deputy master attendant of the Company's marine or pilot service, for supplying the said marine with naval stores, and executing the said service for the term of two years, and without advertising for proposals. That the use and expenditure of such stores and the direction of the pilot vessels are under the management and at the disposition of the master attendant by virtue of his office; that he is officially the proper and regular check upon the person who furnishes the stores, and bound by his duty to take care that all contracts for furnishing such stores are duly and faithfully executed. That the said Warren Hastings, by uniting the supply and the check in the same hands, did not only disobey the Company's specific orders, and violate the fundamental rules and practice of the service, but did overset the only just and rational principle on which this and every other service of a similar nature ought to be conducted, and did not only subject the Company's interest, in point of expense, to fraud and collusion, but did thereby expose the navigation of the Bengal river to manifest hazard and distress: considering that it is the duty of the master attendant to take care that the pilot vessels are constantly stationed in the roads to wait the arrival of the Company's ships, especially in tempestuous weather, and that they should be in a constant condition to keep the sea; whereas it is manifestly the interest of the contractor, in the first instance, to equip the said vessels as scantily as possible, and afterwards to expose them as little as possible to any service in which the stores to be replaced by him might be lost or consumed. And, finally, that in June, 1779, the said contract was prolonged to the said master attendant, by the said Warren Hastings, for the further period of two years from the expiration of the first, without advertising for proposals.—That it does not appear that any of the preceding contracts have been annulled, or the charges attending any of them abated, or that the Court of Directors have ever taken any measures to compel the said Warren Hastings to indemnify the Company, or to make good any part of the loss incurred by the said contracts.

That in the year 1777 the said Warren Hastings did recommend and appoint John Belli, at that time his private secretary, to be agent for supplying the garrison of Fort William with victualling stores; that the stores were to be purchased with money advanced by the Company, and that the said agent was to be allowed a commission or percentage for his risk and trouble; that, in order to ascertain what sum would be a reasonable compensation for the agent, the Governor-General and Council agreed to consult some of the principal merchants of Calcutta; that the merchants so consulted reported their opinion, that twenty per cent on the prime cost of the stores would be a reasonable compensation to the agent; that, nevertheless, the said Warren Hastings, supported by the vote and concurrence of Richard Barwell, then a member of the Supreme Council, did propose and carry it, that thirty per cent per annum should be allowed upon all stores to be provided by the agent. That the said Warren Hastings professed that "he preferred an agency to a contract for this service, because, if it were performed by contract, it must then be advertised, and the world would know what provision was made for the defence of the fort": as if its being publicly known that the fort was well provided for defence were likely to encourage an enemy to attack it. That in August, 1779, in defiance of the principle laid down by himself for preferring an agency to a contract, the said Warren Hastings did propose and carry it, that the agency should be converted into a contract, to be granted to the said John Belli, without advertising for proposals, and fixed for the term of five years,—"pretending that he had received frequent remonstrances from the said agent concerning the heavy losses and inconveniences to which he was subjected by the indefinite terms of his agency," notwithstanding it appeared by evidence produced at the board, that, on a supply of about 37,000l., he had already drawn a commission of 22,000l. and upwards. That the said Warren Hastings pledged himself, that, if required by the Court of Directors, the profits arising from the agency should be paid into the Company's treasury, and appropriated as the Court should direct. That the Court of Directors, as soon as they were advised of the first appointment of the said agency, declared that they considered the commission of twenty per cent as an ample compensation to the agent, and did positively order, that, according to the engagement of the said Warren Hastings, "the commission paid or to be paid to the said agent should be reduced to twenty pounds per cent." That the said John Belli did positively refuse to refund any part of the profits he had received, or to submit to a diminution of those which he was still to receive; and that the said Warren Hastings has never made good his own voluntary and solemn engagement to the Court of Directors hereinabove mentioned: and as his failure to perform the said engagement is a breach of faith to the Company, so his performance of such engagement, if he had performed it, and even his offering to pledge himself for the agent, in the first instance, ought to be taken as presumptive evidence of a connection between the said Warren Hastings and the said agent, his private secretary, which ought not to exist between a Governor acting in behalf of the Company and a contractor making terms with such Governor for the execution of a public service.

That, before the expiration of the contract hereinbefore mentioned for supplying the army with draught and carriage bullocks, granted by the said Warren Hastings to Ernest Alexander Johnson for three years, the said Warren Hastings did propose and carry it in Council, that a new contract should be made on a new plan, and that an offer thereof should be made to Richard Johnson, brother and executor of the said contractor, without advertising for proposals, for the term of five years; that this offer was voluntarily accepted by the said Richard Johnson, who at the same time desired and obtained that the new contracts should be made out in the name of Charles Croftes, the Company's accountant and sub-treasurer at Fort William; that the said Charles Croftes offered the said Richard Johnson as one of his securities for the performance of the said contract, who was accepted as such by the said Warren Hastings; and that, at the request of the said contractor, the contract for victualling the Europeans serving at the Presidency was added to and united with that for furnishing bullocks, and fixed for the same period. That this extension of the periods of the said contracts was not compensated by a diminution in the charge to be incurred by the Company on that account, as it ought to have been, but, on the contrary, the charge was immoderately increased by the new contracts, insomuch that it was proved by statements and computations produced at the board, that the increase on the victualling contract would in five years amount to 40,000l., and that the increase on the bullock contract in the same period would amount to above 400,000l. That, when this and many other weighty objections against the terms of the said contracts were urged in Council to the said Warren Hastings, he declared that he should deliver a reply thereto; but it does not appear that he did ever deliver such reply, or ever enter into a justification of any part of his conduct in this transaction.—That the act of Parliament of 1773, by which the first Governor-General and Council were appointed, did expressly limit the duration of their office to the term of five years, which expired in October, 1779, and that the several contracts hereinbefore mentioned were granted in September, 1779, and were made to continue five years after the expiration of the government by which they were granted. That by this anticipation the discretion and judgment of the succeeding government respecting the subject-matter of such contracts was taken away, and any correction or improvement therein rendered impracticable. That the said Warren Hastings might have been justified by the rules and practice or by the necessity of the public service in binding the government by engagements to endure one year after the expiration of his own office; but on no principles could he be justified in extending such engagements beyond the term of one year, much less on the principles he has avowed, namely, "that it was only an act of common justice in him to secure every man connected with him, as far as he legally could, from the apprehension of future oppression." That the oppression to which such apprehension, if real, must allude, could only consist in and arise out of the obedience which he feared a future government might pay to the orders of the Court of Directors, by making all contracts annual, and advertising for proposals publicly and indifferently from all persons whatever, by which it might happen that such beneficial contracts would not be constantly held by men connected with him, the said Warren Hastings. That this declaration, made by the said Warren Hastings, combined with all the circumstances belonging to these transactions, leaves no room to doubt, that, in disobeying the Company's orders, and betraying the trust reposed in him as guardian of the Company's property, his object was to purchase the attachment of a number of individuals, and to form a party capable of supporting and protecting him in return.