Then like lightning from a clear sky fell the massacre upon the unsuspecting settlers. The blow was terrible to the colonists: the Indians, besides killing many of the inhabitants, burned many houses and destroyed a great quantity of stock. At first the settlers were panic-stricken, but rage succeeded fear. They divided into squads, and carried fire and sword into the Indian villages along the James and the York. In a little while the success of the English was so complete that they were able to give their time wholly to their crops and to rebuilding their houses.[21 ]

To the company the blow was a fatal one, though it did not manifest its results immediately. So far was the massacre from affecting the confidence of the public in Southampton and his friends at the head of the company that eight hundred good settlers went to Virginia during the year 1622, and John Smith wrote, "Had I meanes I might have choice of ten thousand that would gladly go."[22 ] But during the summer the members of the company were entangled in a dispute, of which advantage was taken by their enemies everywhere. At the suggestion of the crafty earl of Middlesex, the lord high treasurer of England, they were induced to apply to the king for a monopoly of the sale of tobacco in England; and it was granted on two conditions—viz., that they should pay the king £20,000 (supposed to be the value of a third of the total crop of Virginia tobacco) and import at least forty thousand pounds weight of Spanish tobacco. Though this last was a condition demanded by the king doubtless to placate the Spanish court, with whom he was negotiating for the marriage of his son Charles to the infanta, the contract on the whole was displeasing to Count Gondomar, the Spanish minister. He fomented dissensions in the company over the details, and Middlesex, the patron of the measure, being a great favorer of the Spanish match, changed sides upon his own proposition.[23 ]

In April, 1623, Alderman Robert Johnson, deputy to Sir Thomas Smith during the time of his government, brought a petition to the king for the appointment of a commission in England to inquire into the condition of the colony, which he declared was in danger of destruction by reason of "dissensions among ourselves and the massacre and hostility of the natives." This petition was followed by a scandalous paper, called The Unmasking of Virginia, presented to the king by another tool of Count Gondomar, one Captain Nathaniel Butler.[24 ] The company had already offended the king, and these new developments afforded him all the excuse that he wanted for taking extreme measures. He first attempted to cow the company into a "voluntary" surrender by seizing their books and arresting their leading members. When this did not avail, the Privy Council, November 3, 1623, appointed a commission to proceed to Virginia and make a report upon which judicial proceedings might be had. The company fought desperately, and in April, 1624, appealed to Parliament, but King James forbade the Commons to interfere.

In June, 1624, the expected paper from Virginia came to hand, and the cause was argued the same month at Trinity term on a writ of quo warranto before Chief-Justice James Ley of the King's Bench. The legal status of the company was unfavorable, for it was in a hopeless tangle, and the death record in the colony was an appalling fact. When, therefore, the attorney-general, Coventry, attacked the company for mismanagement, even an impartial tribune might have quashed the charter. But the case was not permitted to be decided on its merits. The company made a mistake in pleading, which was taken advantage of by Coventry, and on this ground the patent was voided the last day of the term (June 16, 1624).[25 ]

Thus perished the great London Company, which in settling Virginia expended upward of £200,000 (equal to $5,000,000 in present currency) and sent more than fourteen thousand emigrants. It received back from Virginia but a small part of the money it invested, and of all the emigrants whom it sent over, and their children, only one thousand two hundred and twenty-seven survived the charter. The heavy cost of the settlement was not a loss, for it secured to England a fifth kingdom and planted in the New World the germs of civil liberty. In this service the company did not escape the troubles incident to the mercenary purpose of a joint-stock partnership, yet it assumed a national and patriotic character, which entitles it to be considered the greatest and noblest association ever organized by the English people.[26 ] However unjust the measures taken by King James to overthrow the London Company, the incident was fortunate for the inhabitants of Virginia. The colony had reached a stage of development which needed no longer the supporting hand of a distant corporation created for profit.

In Virginia, sympathy with the company was so openly manifested that the Governor's council ordered their clerk, Edward Sharpless, to lose his ears[27 ] for daring to give King James's commissioners copies of certain of their papers; and in January, 1624, a protest, called The Tragical Relation, was addressed to the king by the General Assembly, denouncing the administration of Sir Thomas Smith and his faction and extolling that of Sandys and Southampton. The sufferings of the colony under the former were vigorously painted, and they ended by saying, "And rather (than) to be reduced to live under the like government we desire his matie yt commissioners may be sent over wth authoritie to hang us."

Although Wyatt cordially joined in these protests, and was a most popular governor, the General Assembly about the same time passed an act[28 ] in the following words: "The governor shall not lay any taxes or ympositions upon the colony, their lands or commodities, other way than by authority of the General Assembly to be levied and ymployed as the said assembly shall appoynt." By this act Virginia formally asserted the indissoluble connection of taxation and representation.

The next step was to frame a government which would correspond to the new relations of the colony. June 24, 1624, a few days after the decision of Chief-Justice Ley, the king appointed a commission of sixteen persons, among whom were Sir Thomas Smith and other opponents of Sandys and Southampton, to take charge, temporarily, of Virginia affairs; and (July 15) he enlarged this commission by forty more members. On their advice he issued, August 26, 1624, authority to Sir Francis Wyatt, governor, and twelve others in Virginia, as councillors to conduct the government of the colony, under such instructions as they might receive from him or them.

In these orders it is expressly stated that the king's intention was not to disturb the interest of either planter or adventurer; while their context makes it clear that he proposed to avoid "the popularness" of the former government and to revive the charter of 1606 with some amendments. King James died March 27, 1625, and by his death this commission for Virginia affairs expired.[29 ]

Charles I. had all the arbitrary notions of his father, but fortunately he was under personal obligations to Sir Edwin Sandys and Nicholas Ferrar, Jr., and for their sake was willing to be liberal in his dealing with the colonists.[30 ] Hence, soon after his father's death, he dismissed the former royal commissioners and intrusted affairs relating to Virginia to a committee of the Privy Council, who ignored the Smith party and called the Sandys party into consultation.[31 ] These last presented a paper in April, 1625, called The Discourse of the Old Company, in which they reviewed fully the history of the charter and petitioned to be reincorporated. Charles was not unwilling to grant the request, and in a proclamation dated May 13, 1625, he avowed that he had come to the same opinion as his father, and intended to have a "royal council in England and another in Virginia, but not to impeach the interest of any adventurer or planter in Virginia."