In 1841 Felix Hathaway, in the employment of the Mission, began to build a house on the island, at which Dr. McLoughlin remonstrated with Waller, but the latter assured Dr. McLoughlin that no wrong was intended and Hathaway stopped his building operations. Matters ran smoothly until the autumn of 1842. By this time Dr. McLoughlin had again made improvements on his claim, having it surveyed and part of it laid off in town lots and blocks, which he named Oregon City. Some of these lots and blocks he gave away, some he sold. I cannot go into all the evasive actions of Waller and the false statements and claims made by him, and by John Ricord, his attorney, in relation to Waller's supposed rights to Dr. McLoughlin's land claim. Waller employed Ricord as an attorney and asserted his ownership of all the McLoughlin land claim, except Abernethy Island, to which the Oregon Milling Company laid claim. A public proclamation signed by Ricord as attorney for Waller, although dated December 20, 1843, was publicly posted at Oregon City early in 1844. It set forth the alleged illegality of Dr. McLoughlin's claim and the imaginary rights of Waller.[36] Whatever possession Waller had of any part of this land was due to the kind permission of Dr. McLoughlin. Waller attempted to turn this kindness into a question of right to the whole land claim, excepting Abernethy Island. An agreement or settlement, dated April 4, 1844, was executed by Rev. A. F. Waller, Rev. David Leslie, acting Superintendent of the Methodist Mission, and by Dr. McLoughlin. Under this agreement Dr. McLoughlin was compelled to pay Waller five hundred dollars and to convey to Waller eight lots and three blocks in Oregon City, and also to convey to the Methodist Mission six lots and one block in Oregon City. What right the Mission had to insist on the conveyance to it of this land has never been explained--Waller, in said agreement or settlement, surrendering and forever abandoning to Dr. McLoughlin "all claims, rights, and pretensions whatsoever" which Waller had to the land claim of Dr. McLoughlin, which is described in said agreement as "a tract of land situated at the falls of the Wallamette River on the east side of said River, containing six hundred and forty acres, and surveyed by Jesse Applegate in the month of December, A. D. 1843." This survey included Abernethy Island. There were not then any courts in Oregon to which Dr. McLoughlin could apply for relief, as he had not then joined the Provisional Government. It was probably better and cheaper for him to submit to this unfair agreement, otherwise he would have been compelled to allow Waller to take the land or to have ousted him by force.[37]