stated that Labuan would be ceded "on such terms as may hereafter be arranged," and a promise to suppress piracy, the profits in which were shared by the Sultan and his nobles, was by no means regarded by them as a fair set off; it was a condition with which they would have readily dispensed. The Sultan ventured to remark that the present treaty was different to the previous one, and that a money payment was required in exchange for the cession of territory. Captain MUNDY replied that the former treaty had been broken when Her Majesty's Ships were fired on by the Brunai forts, and "at last I turned to the Sultan, and exclaimed firmly, 'Bobo chop bobo chop!' followed up by a few other Malay words, the tenor of which was, that I recommended His Majesty to put his seal forthwith." And he did so. Captain MUNDY hoisted the British Flag at Labuan on the 24th December, 1846, and there still exists at Labuan in the place where it was erected by the gallant Captain, a granite slab, with an inscription recording the fact of the formal taking possession of the island in Her Majesty's name. In the following year, Sir JAMES BROOKE was appointed the first Governor of the new Colony, retaining his position as the British representative in Brunai, and being also the ruler of Sarawak, the independence of which was not formally recognised by the English Government until the year 1863. Sir JAMES was assisted at Labuan by a Lieutenant-Governor and staff of European Officers, who on their way through Singapore are said to have somewhat offended the susceptibilities of the Officials of that Settlement by pointing to the fact that they were Queen's Officers, whereas the Straits Settlements were at that time still under the Government of the East India Company. Sir JAMES BROOKE held the position of Governor until 1851, and the post has since been filled by such well-known administrators as Sir HUGH LOW, Sir JOHN POPE HENNESSY, Sir HENRY E. BULWER and Sir CHARLES LEES, but the expectations formed at its foundation have never been realized and the little Colony appears to be in a moribund condition, the Governorship having been left unfilled since 1881. On the 27th May, 1847, Sir JAMES BROOKE concluded the Treaty with the Sultan of Brunai which is still in force. Labuan is situated off the mouth of the Brunai River and has an area of thirty square miles. It was uninhabited when we took it, being only occasionally visited by fishermen. It was then covered, like all tropical countries, whether the soil is rich or poor, with dense forest, some of the trees being valuable as timber, but most of this has since been destroyed, partly by the successive coal companies, who required large quantities of timber for their mines, but chiefly by the destructive mode of cultivation practised by the Kadyans and other squatters from Borneo, who were allowed to destroy the forest for a crop or two of rice, the soil, except in the flooded plains, being not rich enough to carry more