The advent of Captain Grey as third Governor of South Australia has been recorded in a previous number, as well as the account of the first serious difficulties he had immediately on his arrival to face in suppressing the outbreak of the natural possessors of the country. I propose next to relate a few instances of the cruel wrongs which white pioneers had to endure under the crowning ruin which the policy of the British Government instructed Captain Grey to carry out as to the financial liabilities of the colony, and which he undertook with his eyes open, for he did not come as a stranger.

I give first a brief account of the ruin of the firm of Borrow & Goodiar by the direct action of Captain Grey's Government in cancelling the large contracts under which the firm were bound to the Government of Colonel Gawler. The bills which they had received on the Home Government in part payment for work done having been also dishonored, they were suddenly brought to a standstill, and had to meet the claims of their numerous workpeople, their merchants and bankers, with promises. In this crisis they waited with an influential merchant, on the Governor, and the case of the firm was with great force pressed on His Excellency, who treated them with kind consideration, and in answer he gave them full and decided assurances that the claims of the firm should be honorably met, and be submitted to arbitration.

With this favorable and gracious reception they left Government House, highly pleased and satisfied, and went direct to the Government Offices and had an interview with Mr. Gouger, the Colonial Secretary, and Mr. Jackson, the Treasurer, to whom they detailed the promising result of their interview with Governor Grey. Their explanation of the answer they had obtained from His Excellency's lips was received by these officers with the greatest surprise, and they assured their visitors that the Governor, had not the power or means to make good such promises, and that there was no chance of an early settlement of their claims on any terms. And so the result proved, to the total ruin of their extensive business, which extended beyond the building trade, for they had taken leases of suburban sections, which they had fenced in with a view to the growth of wheat, and had sunk their capital in legitimate and, for the country beneficial pursuits. It was not until a weary and lengthened contest that their creditors obtained from the Government a dividend by a compromise, and accepted a portion of the just claims of the firm.

I may mention here that during the year 1842 no less than 136 writs were posted through the Sheriff's Court, and 37 fiats of insolvency were issued. In one important respect the disastrous consequences of the losses sustained in the colony were made apparent on the non-payment of the Government debts, as out of 1,915 houses that had been built in Adelaide 642 were in December, 1842, totally deserted, and the people spread out in the country districts.

One of the ruined pioneers of the colony [ John Barton Hack], who has published a brief history of his early career in the Methodist Journal, having allowed me to extracts therefrom, I take advantage of the privilege, with thanks, as the ultimate sacrifice of the wreck of his property followed, as in the writer's case and in so many others, from the advantage taken of their weakened state after the first general blow, and when the news was received of the confirmed repudiating actions of the Home Government. I commence to quote from the termination of 'Pioneer's' voyage from home, in order to show how he commenced from the first in his colonial career to go in with all his energies and means as a bona fide pioneer settler, to assist in stocking and cultivating the new colony, as follows : —

[ John Barton Hack] "After the inevitable discomforts of a long sea voyage in the ship Isabella, which Captain Hart, the commander, endeavored to make as pleasant as possible, we sighted Van Dieman's Land on the 1st January, 1837, and at once sailed up the River Tamar, and grounded in the mud two or three miles from Launceston. We obtained lodgings, and began to make anxious enquiries respecting the new colony. We found that many shipments of sheep had been made to Port Philip (then a new colony, an offshoot of New South Wales). The John Pirie arrived from St. Vincent's Gulf, South Australia, and reported having spoken the Buffalo, beating up the Gulf, so that we had arrived in Tasmania nearly as soon as Governor Hindmarsh and his staff arrived at his seat of Government.

" The settlers were said to have landed at Kingscote, Kangaroo Island, and Rapid Bay; on the main, but had many of them gone north to a part of the coast opposite to Mount Lofty, near to which a river or inlet of the sea had been discovered, with 2½ fathoms of water on the bar. The Isabella was laid on for the new colony, our destination, and we proceeded at once to make our purchases of stock (for which purpose we had come round), and all that appeared necessary for the occupation of three preliminary sections purchased in England. We put on board 350 ewes, 45 wethers, 6 heifers, 1 Devon bull, 10 working bullocks, 2 mares, a Timor pony, goats, pigs, poultry, dray, waggon, seed wheat, and provisions for 12 months, with the packages brought with us in the ship. I engaged four bush hands and a female as washerwoman. Three out of the four were convicts, but there was no choice, and the fencing and other work required men of experience in colonial operations. The woman turned out a confirmed drunkard, and was for years known in the colony as Scotch Bella, who had more interviews in her time than any other man or woman with the Resident Magistrate.

" We sailed on the 1st of February from the Tamar, and were met by contrary winds and rough weather, during which one bullock died and many sheep. At length on the 9th we reached Backstairs Passage, and when off Rapid Bay a boat was lowered, and the captain, myself, and one or two more went ashore, found no settlers, but only a few huts. The captain said he would run up the Gulf 40 miles, when he expected to find the Buffalo and the body of settlers. We anchored about midnight, but found in the morning we were two or three miles south of the Buffalo at anchor, and the Coromandel also, which latter vessel had arrived before us. A strong, hot north wind was blowing, and to save the lives of as many sheep as possible the captain landed them opposite the ship. No water was near, and as the sheep-netting was not landed according to promise we could not make a yard. In consequence the sheep broke adrift in the night, and were most of them irrecoverably lost. The other stock were landed in fair order. A heifer calved a day or two after, and I had the pleasure of milking the first cow of the colony.

" The settlers were camped over the sand hills, at the present site of Glenelg, and were busily rolling their goods over the sand hummocks. My men at once yoked a team of eight bullocks and brought our goods from the ship's longboat to the camp we formed near a lagoon. It created quite a sensation in the encampment, as most of the people had not seen a colonial team before. Mr. Jno. Hallett had, however, landed two bullocks, and a few wethers before we arrived. In a few days a vessel from the Cape brought some fine Fatherland cows for the Government, several of which I subsequently bought at auction at an average price of £27 each, and subsequently one at £36. We found the colony had been proclaimed over five weeks before we landed, but the survey of Adelaide was not completed. I had brought out two of Manning's cottages. One I first put up at the Bay, and the other I placed at Adelaide, opposite North-terrace. In April I finished the cottage there, and brought up the other from the Bay, and with the two formed a four-roomed habitation.

" While the Isabella lay in Holdfast Bay, Captain Hart said he wished to return in the ship to procure a freight if he could. Not being able to procure land, except at an exhorbitant price, I commenced mercantile business, much against my inclination, and purchased goods out of the Regia, the William, &c. I further agreed to take goods from Captain Hart, and pay freight and 10 per cent, on the invoice, also that I would pay for any stock landed in good condition, at specified prices; and we parted, expecting, if Mr. Griffiths, the owner of the Isabella, consented, to meet again before long.

" In April a meeting of holders of preliminary land orders was called, at which a resolution was carried to ballot for the locality in which the sections should be selected, which caused my three to be placed in District D. Yankalilla, the survey of which was not made for some two or three years after, before which we had sold the land orders as useless to us.

" The town acres, after the preliminary acres had been allotted, were offered by public auction, and realised about £4,000, after reserving the 437 preliminary (gift) acres, belonging to the 134 acres preliminary sections. I became the purchaser of 60 acres of town land for want of other land. I enclosed 12 acres in Lower North Adelaide, and sowed wheat the first season. A sample of the produce was sent home, and excited some notice in Mark Lane. Mr. G. Stevenson also commenced a garden close by, and soon made it one of the show places of the colony. Our bullock-team was fully employed in carting goods from the Port and Bay for the settlers. I have a record of £12 for one day's work, when loaded both ways.

" On the 6th of April the brig William arrived from Tasmania, and reported that the Isabella had sailed the day previous to the William ; that she had on board 400 sheep, 12 bullocks, and four cows for us, besides a variety of goods selected in Launceston and consigned to me. I this day dined at Mr. Gouger's, the Colonial Secretary, and met Sir John Jeffcott, who had just arrived. He rode with me to some fine country about 10 miles south of Adelaide, where we were putting up yards and huts to receive the stock expected.

" On the 13th of April I rode to the Bay, and on arriving at our camp found Captain Hart there. I was sorry to hear from him that he had lost the Isabella, which was totally wrecked on Cape Nelson, near Portland Bay, on her voyage hither. The loss was occasioned by the neglect of the mate, who came out with us in the ship from England. She was uninsured, and the captain said he had lost everything, and his friends had turned their backs on him. He described to a friend that he possessed nothing but what he stood up in. He said, Mr. Wm. Jones, who was a passenger with him, had joined him in the shipment. I invited the captain to remain with us, and at the time thought myself very fortunate in being, as I supposed, free from personal liability. But then there was the disappointment and loss of gain in the stock and goods not coming to hand, all being much wanted."

[I may mention here that the captain, who was brought to such a bare position, was the Captain Hart whose after career in this colony was so successful, and who attained a leading political station, and acquired great wealth, whose sons are now carrying on the large export trade in the staff of life, as purchasers and exporters of wheat, which he established.]

[ John Barton Hack] " In consequence of the difficulty in procuring land and the backwardness of the surveys, a plan was originated called the special survey system by which on £4,000 being lodged with the Colonial Treasurer, a block of 15,000 acres might be selected out of which 4,000 acres might be chosen."

This amounted to selection before survey, and allowed the eyes of the country to be picked out, and a number of such special surveys were soon taken up, and in surveying occupied the time of the surveying staff, the greater portion being applied for by mere speculators in land or large capitalists non-resident.

"After Captain Hart had remained some time with us I entered into an agreement with him to go to Sydney and purchase on our account a schooner to trade between that place and Adelaide, and furnished him with funds for that purpose. Not very long after Mr. Jones arrived in Adelaide, and made a claim on me for the value of the lost cargo, stating they had purchased the goods as my agent. As no authority could be produced in writing, no action could be against me ; but I agreed to an arbitration, and had to pay for the goods, but not the stock. Mr. Jones received about £700 from me, but Captain Hart refused to receive his share, admitting it was an unjust claim. My brother joined Captain Hart in Sydney, and they agreed for the purchase of about 800 head of cattle, to be delivered at Portland Bay. About half after arrival were shipped from thence to Adelaide, but arrived in very bad condition. On the safe arrival of the remainder of our cattle, 400 in number, overland from Portland Bay, conducted by Captain Hart, who, taking Major Mitchell's track towards the River Murray, and then following the course down the same and the track to Mount, Barker, arrived safe at the spot where the township now stands.

" We here formed a dairy station, and made arrangements with the Bank, by which we were able to purchase a special survey, of which we were to take 3,000 acres, and a Cattle Company, of which I was a director the balance, 1,000 acres. We were, however, forestalled by a few hours by some speculators from Sydney, who obtained the Treasurer's receipt before my money was tendered. Having made ourselves very certain we should be unopposed, the disappointment was great."

[The writer of these papers [ John Barton Hack], was glad to come into this first Mount Barker special survey with two land orders purchased, and paid for before leaving England, and one in the colony, i.e., nearly three years after the first payment, but had not the privilege to select until after the speculators had picked out their 4,000 acres, not one of whom personally became an occupier.

" In this emergency we next applied for another survey, south of the Mount Barker block, which we obtained. It was afterwards called Echunga, and there we commenced to improve and fence. We soon had two dairies at work, with 70 cows milking in each —one at Echunga and one on a thousand acres we had taken up on the little Para part of a special survey — and also established a cattle run at Yankalilla, for dry cattle and breeding. A large speculation under the special survey system was made on behalf of Mr. Angas, by Mr. Flaxman, his agent. Although it seemed a very considerable outlay at the time the result has proved a very satisfactory investment of capital for Mr. Angas.

" In 1839 we built a house at Echunga on the survey and laid out a garden of twelve acres, to furnish which I sent for a large invoice of trees &c, from Hobart Town, and it soon became very flourishing and productive. I removed my family there in 1840, and to attend to the business in Adelaide rode in by 10 a.m., returned on the following evening, and remained out one day, and so continued to carry on with the country work and the town business. Experience has shown me that the difficulties in which I ultimately became involved had their rise in carrying out my desire to acquire a large landed property. Early in 1840 I had an apparent balance to the credit of profit and loss of £30,000, but by 1843 all had to be sacrificed. The special surveys led the way, but the purchase of the land was only a small matter. A large sum was sunk in making the land acquired produce anything ; and these, in common with other heavy business losses, fell on us. Bank assistance was required — very readily granted while the colony flourished, but as summarily called in when the crisis came.

" I sold my Hindley-street property for £4,000, and raised £1,500 on the Echunga property, to pay off claims and in part overdrafts. At length, in 1843, the worst of the storm seemed past ; the manager expressed himself much gratified with the exertions I had made to reduce my liabilities with them, and I felt secure I should have the continued support of the Bank. Time was all that was required, but this luxury was not obtainable. Almost every merchant and trader in the community had to make arrangements with creditors or to become insolvent.

" A few days after the satisfactory interview with the manager of my Bank, I was aroused one morning by two men riding into the yard at Echunga, and on asking their business was informed they were bailiffs come to take possession on behalf of the Bank. At the time there was only one director of the Bank, and an English friend of mine, representing a house in England with whom I had large dealings, and who held a mortgage (as security for advances) on a portion of the Echunga land, married a sister of the said Director, and it was determined to obtain my improved property. This could only be done by my being compelled to insolvency, and this was carried out, and the whole of the Echunga estate passed for a small amount over the mortgage to my English friend and schoolfellow. Judge Cooper was sometimes a guest at Echunga, and little thought when he talked over with me the new insolvency law he was preparing, that I should be one of its first victims."

In No. 21 I have described my journey with my family over the hills to occupy three sections, which I was glad to take up in the first Mount Barker Special Survey. This was the survey out of which 'Pioneer' was choused. Anxious to get into country pursuits in carrying out my original intentions, I lost no time in commencing work on the sections as soon as I got possession, and before I got rid of my town business.

As I have described, I had been actively engaged like 'Pioneer' in introducing stock into the colony. A few months after I commenced I was induced to enter into partnership with a gentleman who arrived from India, who had left the greater part of his capital there to follow him. Immediately before the crisis arrived I was anxious to withdraw from town business, and was advised by the Bank manager, of whom 'Pioneer' speaks, to hand over the partnership stock and liabilities to my partner; this was done as suggested. The cattle — over 400 head of large cattle — were assigned to the manager and a friend of his, to cover partnership acceptances then current, for the last purchases of cattle. Before this was carried out I paid all other partnership claims then due, and lifted one bill for a large amount. I also paid all my private accounts. I agreed to a very low valuation of the cattle, horses, drays, &c. (in a falling market), less than half the cost of the same, with an arrangement that I was to receive out of sales £800.

On this matter being concluded I received a complimentary letter from the Bank manager, and afterwards drew cheques on both Banks on my private accounts. At the time this arrangement was made I was not aware that my partner had obtained large advances from the same Bank, in anticipation of the receipt of funds from India, which he had invested in land, &c, in the colony. He was a large shareholder in an Indian Bank which came to grief. Other heavy losses befel him, and his expected funds did not arrive, but the funds from the assigned partnership stock were taken to clear off his private debt to the Bank.

Not long after this was done I was surprised at my quiet home on a certain day, by the visit of a bailiff and was served with writs for the unpaid partnership debts, and held in durance vile until the arrival from Sydney of the drawers of the bills, who immediately on their arrival discharged me entirely. The first insolvent law having now passed my late partner because one of the first who had to pass through the Court, and in his schedule I appeared as a creditor for the amount of £800, amount of my arranged claim, but I got no dividend, as the insolvent had shortly after again to declare himself ; and such were some of the transactions of that day.

Not to go into minute details of further bitter "experiences," I will only add that advantage at this time was attempted to be taken of my weakened state by a fresh arrival with whom I had been connected in transactions — by whom I should have suffered grievous wrong if I had not been favored by the support of a strong friend, and by whose support I was enabled to force an arbitration, by which I obtained the greater part of my claims, but only on yielding up my comfortable and well-arranged home ; and I had to turn out with a young family to commence again.

The above three instances of 'Early Experiences of Colonial Life' in South Australia, many of which might be added, are sufficient to prove that the early colonists are not to be blamed for the first crisis under which they suffered ruin. They did not voluntarily confine their operations to town pursuits, as has been represented by some of those who have furnished histories of early work in the colony, and as Governor Grey also stated in his early despatches. (To be continued.)

See also G. H. Pitt, "The Crisis of 1841: Its Causes and Consequences" South Australiana (1972) 11#2 pp 43–81. "Grey became Governor of South Australia in 1841. He oversaw the colony during a difficult formative period. Despite being less hands-on than his predecessor George Gawler, his fiscally responsible measures ensured the colony was in good shape by the time he departed for New Zealand in 1845".