This negotiation was entrusted to Mr.Gouverneur Morris, who had been carried by private business to Europe; and he conducted it with ability and address, but was unable to bring it to a happy conclusion.

The result of his conferences with the Duke of Leeds, and with Mr.Pitt, was a conviction that the British government, considering the posts they occupied on the southern side of the great lakes as essential to their monopoly of the fur trade, would surrender them reluctantly, and was not desirous of entering into a commercial treaty.

Those ministers expressed a wish to be on the best terms with America; but repeated the complaints which had been previously made by Lord Carmarthen, of the non-execution of the treaty of peace on the part of the United States.

To the observations made by Mr.Morris, that the constitution lately adopted, and the courts established under it, amounted to a full compliance with that treaty on the part of the American government, it was answered, that losses had already been sustained in consequence of the obstructions given by the states to the fair operation of that instrument, which rendered a faithful observance of it, at present, impossible; and, in a note, the Duke of Leeds avowed the intention, if the delay on the part of the American government to fulfil its engagements made in the treaty should have rendered their final completion impracticable, to retard the fulfilment of those which depended entirely on Great Britain, until redress should be granted to the subjects of his majesty on the specific points of the treaty itself, or a fair and just compensation obtained for the non-performance of those stipulations which the United States had failed to observe.

Though urged by Mr.Morris to state explicitly in what respects, and to what degree, he considered the final completion of those engagements to which the United States were bound, as having been rendered impracticable, no such statement was given; and the British government seemed inclined to avoid, for the present, those full and satisfactory explanations, which were sought on the part of the United States.
After detailing the motives which in his opinion influenced the English cabinet in wishing to suspend for a time all discussions with America, Mr.Morris observed, "perhaps there never was a moment in which this country felt herself greater; and consequently, it is the most unfavourable moment to obtain advantageous terms from her in any bargain." Whilst these negotiations were pending, intelligence was received at London of the attack made on the British settlement at Nootka Sound; and preparations were instantly made to resent the insult alleged to have been offered to the nation.