The resolution of the Galway Company, accepting the proposal of the Canadian government, was adopted, and on the same day the treasury was informed of the fact. A week later--on July 5, 1860--Smith and Galt, the Canadian minister of finance, waited on the secretary of the treasury, who informed them that Palmerston was much gratified that the arrangements had been made, and on the strength of these assurances Smith executed the assignment of the contract, and provided securities for the purchase money, of all of which Palmerston expressed his high approval. The matter was regarded as so far concluded that on July 9 a meeting took place between the Canadian representatives and the officials of the treasury and post office, the details of the scheme were reduced to writing, and the secretary of the post office received the approval of a communication to the postmaster general of the United States informing him of the arrangement, and that thereafter the Canadian ships would be considered as British and not as United States packets. Considering the arrangements as completed, Smith and Galt decided to return to Canada, and on the 11th they called on Palmerston for the purpose of taking their leave, when, to their utter stupefaction, they were informed that the government peremptorily refused to sanction the transfer. The reasons put forward for this unusual action on the part of the government lacked even the merit of plausibility. It was first argued that the Lever contract contemplated the grant of L78,000 a year for a fortnightly service from Galway, in addition to all the ocean service which might be existing, while the transfer would have the effect of substituting the Galway service for one of the existing services, and thus continuing the charge of L78,000 a year with a positive diminution of public accommodation. Smith had a conclusive reply to this argument. He pointed out that at the time the Galway contract was entered into, that is on May 21, 1859, the Canadian service was only fortnightly; and the arrangement for which the sanction of the government was sought would have given exactly the accommodation contemplated when the contract was given--a weekly service between Ireland and America. As for the modifications in the contract, which formed part of the ground of the government's refusal to sanction it, the first was that "the arrangement transferred the contract to a party of undoubted, from one of questioned, solvency." Smith's only comment on this was to complete the sentence by adding "or in other words would ensure its performance efficiently."