For some years the Montreal fur companies, in their combinations and readjustments, had all the variety of the kaleidoscope. Agreements were made for a term of years, and when these had expired new leagues were formed, and in every case dissatisfied members went into opposition and kept up the heat and competition without which it is probable the fur trade would have lost, to those engaged in it, many of its charms.

In 1795 several partners had retired from the North-West Company and thrown in their lot with the famous firm that we have seen was always inclined to follow its own course— Messrs. Forsyth, Richardson and Co. For a number of years this independent Montreal firm had maintained a trade in the districts about Lake Superior. The cause of this disruption in the Company was the unpopularity, among the wintering partners especially, of the strong-willed and domineering chief in Montreal—Simon McTavish. One set of bourgeois spoke of him derisively as "Le Premier," while others with mock deference called him "Le Marquis." Sir Alexander Mackenzie had been himself a partner, had resided in the Far West, and he was regarded by all the traders in the "upper country" as their friend and advocate. Although the discontent was very great when the secession took place, yet the mere bonds of self-interest kept many within the old Company, Alexander Mackenzie most unwillingly consented to remain in the old Company, but only for three years, reserving to himself the right to retire at the end of that time.

Notwithstanding their disappointment, and possibly buoyed up with the hope of having the assistance of their former friend at a later period, the members of the X Y Company girt themselves about for the new enterprise in the next year, so that the usual date of this Company is from the year 1795. Whether it was the circumstance of its origination in dislike of "Le Premier," or whether the partners felt the need of greater activity on account of their being weaker, it must be confessed that a new era now came to the fur trade, and the opposition was carried on with a warmth much greater than had ever been known among the old companies. A casual observer can hardly help feeling that while not a member of the new Company at this date, Alexander Mackenzie was probably its active promoter behind the scenes.

The new opposition developed without delay. Striking at all the salient points, the new Company in 1797 erected its trading house at Grand Portage, somewhat more than half-a-mile from the North-West trading house and on the other side of the small stream that there falls into the Bay. A few years after, when the North-West Company moved to Kaministiquia, the X Y also erected a building within a mile of the new fort. The new Company was at some time in its history known as the New North-West Company, but was more commonly called the X Y Company. The origin of this name is accounted for as follows. On the bales which were made up for transport, it was the custom to mark the North-West Company's initials N.W. When the new Company, which was an offshoot of the old, wished to mark their bales, they simply employed the next letters of the alphabet, X Y. They are accordingly not contractions, and should not be written as such. It was the habit of members of the older Company to express their contempt for the secessionists by calling them the "Little Company" or "the Little Society." In the Athabasca country the rebellious traders were called by their opponents "Potties," probably a corruption of "Les Petits," meaning members of "La Petite Compagnie." When these names were used by the French Canadian voyagours, the X Y Company was referred to.

However disrespectfully they may have been addressed, the traders of the new Company caused great anxiety both to the North-West Company and to the Hudson's Bay Company, though they regarded themselves chiefly as rivals of the former. Pushing out into the country nearest their base of supplies on Lake Superior, they took hold of the Red River and Assiniboine region, as well as of the Red Lake country immediately south of and connected with it. The point where the Souris empties into the Assiniboine was occupied in the same year (1798) by the X Y Company. It had been a favourite resort for all classes of fur-traders, there having been no less than five opposing trading houses at this point four years before. No doubt the presence of the free-trading element such as McCracken and Jussaume, whom we find in the Souris region thus early, made it easier for smaller concerns to carry on a kind of business in which the great North-West Company would not care to be engaged.

Meanwhile dissension prevailed in the North-West Company. The smouldering feeling of dislike between "Le Marquis" and Alexander Mackenzie and the other fur-trading magnates broke out into a flame. As ex-Governor Masson says: "These three years were an uninterrupted succession of troubles, differences, and misunderstandings between these two opposing leaders." At the great gathering at the Grand Portage in 1799, Alexander Mackenzie warned the partners that he was about to quit the Company, and though the winterers begged him not to carry out his threat, yet he remained inexorable. The discussion reported to Mr. McTavish was very displeasing to him, and in the following year his usual letter to the gathering written from Montreal was curt and showed much feeling, he saying, "I feel hurt at the distrust and want of confidence that appeared throughout all your deliberations last season."
Alexander Mackenzie, immediately after the scene at Grand Portage, crossed over to England, published his "Voyages," and received his title. He then returned in 1801 to Canada.

Flushed with the thought of his successes, he threw himself with great energy into the affairs of the opposing Company, the X Y, or, as it was also now called, that of "Sir Alexander Mackenzie and Company." If the competition had been warm before, it now rose to fever heat. The brigandage had scarcely any limit; combats of clerk with clerk, trapper with trapper, voyageur with voyageur, were common. Strong drink became, as never before or since, a chief instrument of the rival companies in dealing with the Indians.

A North-West Company trader, writing from Pembina, says: "Indians daily coming in by small parties ; nearly 100 men here. I gave them fifteen kegs of mixed liquor, and the X Y gave in proportion; all drinking; I quarrelled with Little Shell, and dragged him out of the fort by the hair. Indians very troublesome, threatening to level my fort to the ground, and their chief making mischief. I had two narrow escapes from being stabbed by him ; once in the hall and soon afterwards in the shop."

Such were the troubles of competition between the Companies. The new Company made a determined effort to compete also in the far-distant Peace River district. In October of this year two prominent partners of the new Company arrived with their following at the Peace River. One of these, Pierre de Rocheblave, was of a distinguished family, being the nephew of a French officer who had fought on the Monongahela against Braddock. The other was James Leith, who also became a prominent fur-trader in later days.

Illustrating the keenness of the trade conflict, John McDonald, of Garth, also says in 1798, writing from the Upper Saskatchewan, "We had here (Fort Augustus), besides the Hudson's Bay Company, whose fort was within a musket shot of ours, the opposition on the other side of the new concern I have already mentioned, which had assumed a powerful shape under the name of the X Y Company, at the head of which was the late John Ogilvy in Montreal, and at this establishment Mr. King, an old south trader in his prime and pride as the first among bullies."

Sir Alexander Mackenzie did wonders in the management of his Company, but the old lion at Montreal, from his mountain chateau, showed a remarkable determination, and provided as he was with great wealth, he resolved to overcome at any price the opposition which he also contemptuously called the ''Little Company." In 1802, he, with the skill of a great general, reconstructed his Company. He formed a combination which was to continue for twenty years. Into this he succeeded in introducing a certain amount of new blood; those clerks who had shown ability were promoted to the position of bourgeois or partners. By this progressive and statesmanlike policy, notwithstanding the energy of the X Y Company, the old Company showed all the vigour and enthusiasm of youth.

An employ6 of the North-West Company, Livingston, had a few years before established a post on Slave Lake. Animated with the new spirit of his superiors, he went further north still and made a discovery of silver, but on undertaking to open trade communications with the Eskimos, the trader unfortunately lost his life.

Other expeditions were sent to the Missouri and to the sources of the South Saskatchewan ; it is even said that in this direction a post was established among the fierce tribes of the Bow River, west of the present town of Calgary.

Looking out for other avenues for the wonderful store of energy in the North-West Company, the partners took into consideration the development of the vast fisheries of the St. Lawrence and the interior. Simon McTavish rented the old posts of the King—meaning by these Tadoussac, Chicoutimi, Assuapmousoin, and Mistassini, reached by way of the Saguenay; and Ile Jeremie, Godbout, Mingan, Masquaro, and several others along the north shore of the Lower St. Lawrence or the Gulf. The annual rent paid for the King's posts was 1000l.

But the greatest flight of the old fur king's ambition was to carry his operations into the forbidden country of the Hudson Bay itself. In furtherance of this policy, in 1803 the North-West Company sent a schooner of 150 tons to the shores of Hudson Bay to trade, and along with this an expedition was sent by land by way of St. John and Mistassini to co-operate in establishing stations on the Bay. By this movement two posts were founded, one at Charlton Island and the other at the mouth of the Moose River. Many of the partners were not in favour of these expeditions planned by the strong-headed old dictator, and the venture proved a financial loss. Simon McTavish, though comparatively a young man, now thought of retiring, and purchased the seignory of Terrebonne, proposing there to lead a life of luxury and ease, but a stronger enemy than either the X Y or Hudson's Bay Company came to break up his plans. Death summoned him away in July, 1804.

The death of Simon McTavish removed all obstacles to union between the old and new North-West Companies, and propositions were soon made to Sir Alexander Mackenzie, and his friends, which resulted in a union of the two Companies. We are fortunate in having preserved to us the agreement by which the two Companies—old and new North-West Companies—were united. The partners of the old Company were given three-quarters of the stock and those of the new one-quarter. The provisions of the agreement are numerous, but chiefly deal with necessary administration. One important clause is to the effect that no business other than the fur trade, or what is necessarily depending thereon, shall be followed by the Company. No partner of the new concern is to be allowed to have any private interests at the posts outside those of the Company. By one clause the new North-West Company is protected from any expense that might arise from Simon McTavish's immense venture on the Hudson Bay. It may be interesting to give the names of the partners of the two Companies, those who were not present, from being mostly in the interior and whose names were signed by those having powers of attorney from them, being marked Att.

Anyone acquainted in the slightest degree with the early history of Canada will see in these lists the names of legislative councillors, members of Assembly, leaders in society, as well as of those who, in the twenty years following the signing of this agreement, by deeds of daring, exploration, and discovery, made the name of the North-West Company illustrious. These names represent likewise those who carried on that wearisome and disastrous conflict with the Hudson's Bay Company which in time Mould have ruined both Companies but for the happy union which took place, when the resources of each wore well-nigh exhausted.