The Lady Nelson reached Sydney on the 14th of March after a passage of eight days, and no sooner had she anchored in the harbour than Governor King instructed her commander to refit and prepare to embark yet another colony of settlers. These he proposed to send to Newcastle.* (* Or Kingstown, as it was then called, in honour of Governor King; shortly afterwards he renamed it Newcastle.) Hitherto only some colliers and a guard had been stationed there, in order to ensure a supply of coals for Sydney and for the Government ships, but now the Governor directed that the spot should be raised to the dignity of a settlement. The colonial cutter Resource, and the James sloop, belonging to Mr. Raby, were ordered to sail with the Lady Nelson. The three vessels got under weigh to sail to Newcastle on Tuesday, March 27th, having on board all the persons appointed by the Governor, to proceed there. Embarked in the Lady Nelson were:-- Lieutenant Menzies, Commandant. Mr. Mileham, Surgeon. Mr. F. Bauer, natural history painter. Mr. John Tucker, storekeeper. One overseer, two carpenters, three sawyers, a gardener, a salt bailer and sixteen prisoners. In the Resource were one sergeant and four privates of the New South Wales Corps:-- Mr. Knight, superintendent. Twelve convicts. In the James:-- Mr. George Caley and three miners with implements, and stores and provisions for six months. In consequence of a north-east wind, the ships were not able to leave Sydney harbour on that evening, but were obliged to anchor in Lookout Bay until the following morning, when they again weighed and in a short time cleared the Heads. They arrived at Newcastle safely on the day after their departure, and disembarked the little colony. All three vessels were then loaded with coals and cedar for Sydney, the Lady Nelson receiving on board "twenty-six fine logs of rich cedar." The homeward voyage was unfortunate, as the James was lost off Broken Bay. Leaving Newcastle in a very leaky condition, and encountering a gale, the water gradually gained fast upon her and stopped her progress. Two days afterwards the pumps became choked, and the five men who composed her crew had to bale with buckets. Eventually they stood on to a sandy beach where their vessel, being nearly full of water, was dashed to pieces by the tremendous surf. The crew were picked up on the north head of Broken Bay by the Resource and brought to Sydney.* (* For this portion of the Lady Nelson's story no log has been available. The material has been derived principally from the columns of Sydney newspapers.)