What had happened is best seen by reference to the diary:
'December 31.—About 6 a.m. General Gorbatovsky was summoned by General Fock to the third line of defences to confer. At 9 a.m. three successive explosions took place in Fortification No. 3. After a few minutes a telephone message came in from the work to say that the enemy had exploded two charges in the corners of one of the faces. At the moment when the garrison, led by its commanding officer, Captain Spredovy, dashed out of the quarters in the gorge casemate, in order to get out into the interior of the place before the Japanese could seize the parapet, a third charge was fired, which had been laid in the gorge itself. This charge destroyed the gorge casemates, and buried the commanding officer and 140 men under the débris. The fall of this mass of stuff caused the hand-grenades heaped up in the casemates to detonate and set off four mines, laid under the foundations. The wounded and remnants of the garrison were thus shut up in the casemate, with only one small exit into the gorge ditch, through which they had to crawl. Not being able to get into the interior of the work, the garrison could do nothing to hold the position. The enemy perceived this at once, quickly got into the interior of the work, and seized the gorge, where they brought machine-guns. About 10 o'clock we saw a white flag on the fortification. It is not known who raised it. General Stössel and the Fortress Commandant were informed, and within a quarter of an hour the following order was received from General Stössel:
'"In view of the difficulty of getting out of the Fortification, the remainder of the garrison may surrender; those who can escape may try to."
'This order was transmitted by telephone to the work, whence a list of those alive and wounded was telephoned back. The telephone was then cut to prevent the enemy hearing what we said. It was thought that, having seized the fortification, they would try and storm Tumulus Battery. General Gorbatovsky, therefore, ordered the garrison of this battery to be reinforced by one company of infantry, and a company of sailors to be sent into the trenches of the second line from Laperoff's battery along Vladimir and Mitrofanieff Batteries. About eleven o'clock the enemy's fire ceased. Gorbatovsky decided to hold the second line, having Tumulus Battery on the left flank and Eagle's Nest on the right. He told the Commandant of this, and asked leave to carry it out at night....'
From Stössel's order and subsequent dispositions on that day it is clear that he had no idea of the relationship between the second and third lines. Among other things he ordered the left flank of the second line to be held, while part of the third line was held (Stonebroken Ridge and Big Hill). From this it was plain that Stössel had never seen the second line of positions, and had never been on the hills near.
After the fall of Erh-lung-shan Fort the besiegers opened a heavy fire on the north-east front from Tumulus Battery to Eagle's Nest. At 1 p.m. on January 1 they delivered an attack from the fort on Rocky Ridge. Our troops having lost heart, and being badly demoralized, gave way; but our gun-fire checked the enemy's assault, and the position remained in our possession. However, despite the very strict and definite orders given by the Commandant that the Chinese Wall from Rocky Ridge was to be held at all costs (it was quite possible), as soon as dusk came on, the abandonment of this wall and Rocky Ridge began under Fock's orders. The retirement was executed without any interference from the enemy, and we were able to take with us all except the heavier guns. At five o'clock on January 1 our troops were distributed along the second line—Tumulus Battery, Vladimir Battery, Mitrofanieff Hills, Eagle's Nest, the portion of the Chinese Wall behind Chi-kuan-shan Fort, and Kuropatkin Lunette.
The enemy having now arrived at such a position, it seems a fitting moment to mention in what directions the organization of Port Arthur as a fortress had most failed.
By this time most of the many grave defects in the original conception and subsequent execution of the material defences of this stronghold had become only too painfully clear, though it had not needed the test of bitter experience to make the more glaring errors obvious. There were terrible faults in the original tactical arrangement of the defences and in the details of the works themselves.
The main line of permanent forts, the girdle, was much too close to the objects to be protected—i.e., the dockyard and town. The positions fortified by us were so close that, before capturing these positions, the enemy were able to bombard the place, damage our fleet, and demoralize the population. Some points of vital importance were entirely unprovided with permanent works—i.e., 203 Metre Hill, Angle and Long Hills—and were left for an improvised fortification, which was carried out in a scrambling way after the place had been completely invested. So little had these three positions been considered important that until after May 18 no paths to them had ever been made. Accepting the main line originally chosen, such as it was, there were further defects in the forts themselves. They were in many cases badly sited. On the eastern front the enemy had commanding positions within two miles (Ta-ku-shan, Sia-gu-shan), from which the interior of our defence could be seen and fired into, and our communications shelled. This seriously hampered the movement of troops and the transport of munitions. They were also badly designed for their sites, having no good field of fire and much dead ground in front of them. It is not enough to say they were ill-concealed—they were ingenuously conspicuous. As regards armament, our long-range heavy guns, designed to fight the enemy's siege artillery, were placed right in the front, by which all the advantages to be obtained by their ranging power was thrown away. They naturally drew a concentration of the enemy's fire, and were soon rendered useless. They were a positive curse to the works in which they were placed, for they attracted a fire on to these works, to which they could not efficiently reply. In design many of the forts failed. They were not defiladed; they had no covered communications and no proper shelters. The parapets were feebly revetted with stones and sand-bags, and not having sufficient traverses, could be swept by enfilade fire. The concrete was not covered with earth, but was fully exposed. Lastly, such as they were, our forts were not finished and ready by the time they were wanted.