#1. Discovery of Port Phillip.#--The discovery of Bass Strait in 1798 had rendered it possible for the captains of ships bound for Sydney to shorten somewhat their voyage thither; and as this was recognised by the English Government to be a great advantage, a small vessel, the _Lady Nelson_, was sent out under the command of Lieutenant Grant, in order to make a thorough exploration of the passage. She reached the Australian coast at the boundary between the two present colonies of Victoria and South Australia. Grant called the cape he first met with Cape Northumberland. He saw and named Cape Nelson, Portland Bay, Cape Schanck, and other features of the coast. When he arrived in Sydney he called the attention of Governor King to a small inlet which he had not been able to examine, although it seemed to him of importance. In 1802 the Governor sent back the _Lady Nelson_, now under the command of Lieutenant Murray, to explore this inlet. Lieutenant Murray entered it, and found that a narrow passage led to a broad sheet of water, thoroughly landlocked, though of very considerable extent. He reported favourably of the beauty and fertility of its shores, and desired to name it Port King, in honour of the Governor; but Governor King requested that this tribute should be paid to the memory of his old commander, the first Australian Governor, and thus the bay received its present name, Port Phillip. Only sixty days later Flinders also entered the bay; but when he arrived, some time afterwards, in Sydney, he was surprised to find he was not the first discoverer. It was at this time that the Governor in Sydney was afraid of the intrusion of the French upon Australian soil, and when he heard how favourable the appearance of this port was for settlement he resolved to have it more carefully explored. Accordingly he sent a small schooner, the _Cumberland_, under the charge of Mr. Robbins, to make the examination. The vessel carried Charles Grimes, the Surveyor-General of New South Wales, and his assistant, Meehan; also a surgeon named M'Callum, and a liberated convict named Flemming, who was to report on the agricultural capabilities of the district. [Illustration: THE FIRST HOUSE BUILT IN VICTORIA.]