CHAPTER XII.

THE SCIOTO PURCHASE.

On the 20th of July, 1787, Dr. Cutler says in his Journal: "Colonel Duer came to me with proposals from a number of the principal characters in the city to extend the contract and take in another company, but that it should be kept a profound secret," and "offered me generous conditions if I would accomplish this business for them."

July 27th, he writes: "By this ordinance, we obtained the grant of near 5,000,000 acres of land, amounting to $3,500,000; 1,500,000 acres for the Ohio Company, and the remainder for a private speculation, in which many of the principal characters in America are concerned. Without connecting this speculation, similar terms and advantages could not have been. obtained for the Ohio Company."

This "speculation" was the Scioto Company. Colonel Wm. Duer projected it. He had influence enough in Congress to procure the passage of the ordinance for the Ohio Company's purchase by connecting the Scioto speculation with it. Without it, Dr. Cutler's negotiation for the Ohio Company was a failure. With it, it was an assured success, and upon terms dictated by himself.

The injunction of secrecy was as to the fact of the increased amount of land being for a separate company. The "generous conditions" were, that if Dr. Cutler would secure, for the entire amount of lands asked for, the support of the members of Congress who had declared in favor of the Ohio Company grant, Colonel Duer and his friends would undertake, with Cutler's assistance, to obtain enough additional votes to pass the ordinance for the purchase of the entire tract upon exactly the terms stated in the Ohio Company's petition. This included the grants of land for the establishment of a University and the support of the ministry, which, next to the ac

complishment of the purchase itself, were the objects most desired by Dr. Cutler.

Colonel Duer also agreed that Cutler and Sargent should have for themselves, and such of their friends among the prominent men in the Ohio Company as they chose to interest, one-half interest in the proposed right of purchase, the sale of which he and his friends would undertake to manage.

When Dr. Cutler left home, but little more than one-fourth of the shares of the Ohio Company had been subscribed. The only persons who had been active in securing subscriptions. were Generals Putnam, Tupper, and Parsons, Major Sargent, and himself. It was by no means certain that enough shares would be taken, or, if taken, paid for in time to make the payment required on signing the final contract. To meet this contingency, Colonel Duer offered to loan the Ohio Company $100,000, without interest, or such less sum as should be required, to be repaid to him as collected. If any deception was practiced upon members of Congress by failing to explain to them fully the plans of Colonel Duer, it was more apparent than real. The articles of Association of the Ohio Company, which were read on the floor of Congress and distributed among its members, provided for the purchase of so much land as $1,000,000 in securities would pay for and no more. The Ordinance specifically authorized the Board of Treasury to contract with any "person or persons," thus plainly contemplating the possibility of separate contracts. Dr. Cutler, in an interview with Mr. Osgood, of the Board of Treasury, on July 25th,* communicated to him the plan "in all its parts." Mr. Osgood "highly approved" it, and said "that we might depend on accomplishing our purposes in Europe, and that it was a most important part of our plan."

On the 29th of August, 1787, at a general meeting of the Ohio Company in Boston, Dr. Cutler reported the result of his application to Congress. The report was approved, and he and Major Sargent were instructed to close a contract for 1,500,000 acres on the terms stated. Colonel Richard Platt, of New York, was elected Treasurer. A resolution was

*See Dr. Cutler's journal, that date.

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passed calling on the proprietors to pay their securities into the hands of the Treasurer by the 4th of the coming October. The propriety of accepting, as a Company, the option of purchase in addition to the 1,500,000 acres, included in the ordinance of Congress, was discussed, but no action was taken upon it, because of the opposition of many shareholders, who declared that they would withdraw from the Company if any thing beyond the original purchase was undertaken.

In October, 1787, Dr. Cutler and Major Sargent returned to New York, and on the 27th of that month closed two contracts with the Board of Treasury. One with Manasseh Cutler and Winthrop Sargent, as agents for the Directors of the "Ohio Company of Associates, so called," was an absolute purchase of 1,500,000 acres, lying between the Ohio River, the 7th and 17th ranges of townships, and extending north from the river till a line due west from the 7th to the 17th range should, with the reservations stated in the contract, include the whole amount. The other with Manasseh Cutler and Winthrop Sargent, "for themselves and associates," was an option to purchase all the lands lying between the Ohio and Scioto Rivers and the 17th Range, extending north to the line of the 10th Township, and also all the land east of this tract, west of the 7th Range, south of the 10th Township, and north of the Ohio Company's purchase. The whole tract of land included in the last contract was estimated to be from 3,000,000 to 3,500,000 acres. In each contract, the line of the 17th range is recognized as yet to be determined. The price of the land was one dollar per acre, subject to a reduction of one-third for bad land, to be paid in gold, silver, or securities of the United States.

On the 24th of October Cutler and Sargent, for themselves and associates, "ceded and conveyed," in equal shares to William Duer and his associates, the right of pre-emption or option of purchase of the last named tract. The whole ownership was divided into thirty parts. Thirteen (13) were to belong in full ownership to Duer, in which he could join such persons as he saw fit; thirteen (13) in like manner to Cutler

*It proved to be near 5,000,000 acres.

and Sargent; and four (4) were to be disposed of in Europe for joint account. William Duer was authorized to contract for the sale of the lands in Holland, or elsewhere in Europe, with power to substitute an agent. He was to make known, when requested, to Cutler and Sargent, the progress of the negotiations. Royal Flint was agreed upon as the agent to be sent to Europe. In case he could not go, Colonel Duer was empowered to name another.

As a consideration to the Ohio Company for permitting the contract to be made under cover of its petition, Colonel Duer advanced to it $143,000 in securities to enable it to complete the first payment to the Board of Treasury, many share-holders i having failed to respond promptly to the call. This amount was repaid to him when collected from the share-holders of the Ohio Company. No formal organization of the Scioto Company in America was ever made. There was no occasion. for any. Those interested held assignments of proportions. from either Cutler and Sargent, or Colonel Duer. The entire management of the sale was confided to Colonel Duer, whose business experience, financial standing, social and official position were such as to inspire his associates with implicit confidence. The intention was to make an immediate sale of the right of pre-emption to the entire tract, except that part immediately north of the Ohio Company lands, either in Holland or France, where large amounts of the public debt were held. The credit of the United States was at its lowest ebb. The Confederacy had demonstrated its utter inability to enforce the collection of a tax for any purpose whatever. It had no resource from which to pay the public debt, except the public lands. The Cutler and Sargent option comprised the largest tract, to which the Indian title had been extinguished, which was now offered for sale, and was located in a part of the country which all who had visited it described as the garden of the new world. It was fair to expect that holders of the public debt abroad would eagerly exchange their securities, now begging purchasers at four shillings to the pound, for such lands, and at prices that would yield a handsome profit. Soon after making the contract with Colonel Duer, Cutler

and Sargent assigned equal interests to Generals Benjamin Tupper, Rufus Putnam, S. H. Parsons, and Mr. Royal Flint. Generals Putnam, Tupper, and Parsons, had served with distinction in the Revolutionary War, and were the most prominent members of the Ohio Company who moved to Marietta. Royal Flint was a Connecticut man, a graduate of Yale College, who had served as paymaster in the Revolution, and was a prominent merchant in New York city. Joel Barlow had an interest equal to one-sixtieth of the whole, by assignment from Cutler and Sargent, dated 26th November, 1787. Colonel Richard Platt had one share, or one-thirtieth of the whole, by assignment from Colonel Duer. Andrew Craigie † also held. an interest. There is no positive information as to who Colonel Duer's other partners were. The original shares were soon subdivided. Dr. Cutler gave to Rev. Daniel Story onehalf of his interest to induce him to settle in Marietta. Royal Flint assigned four-ninths of his interest to Joel Barlow. General Putnam assigned a part of his to Colonel R. J. Meigs, Sr.

In May, 1788, Joel Barlow was selected as an agent to effect a sale in France, instead of Mr. Flint, whose ill health prevented him from going abroad. On the 14th of May, 1788, William Duer assigned to Barlow, out of his moiety, such part as should equal one-sixtieth of the whole. Barlow therefore held an interest of about two shares. He sailed for France May 25, 1788, and arrived at Havre, June 24th. For authority he had certified copies of Cutler and Sargent's contract with the Board of Treasury, and their assignment and power of attorney to William Duer, and a power of attorney to himself from William Duer, giving him all the powers which Duer

* Each interest is described as one-sixth of eleven-thirtieths, and a proportionate part of the four shares reserved to be sold in Europe. † Andrew Craigie was Apothecary-General of the American army during the Revolution. He lived in Cambridge, Mass., and was the owner of the house where General Washington had his head-quarters. The house subsequently became the home of the poet Longfellow.

Barlow was interested with Duer, Craigie, Platt, and Joseph Parker, in a somewhat similar speculation on the Wabash, and had prepared to go abroad on that account, but because of unfavorable letters received in April, 1788, regarding it, did not go.