William Webster was born in 1815 at Portland, Maine, in the United States, and arrived in New Zealand in March 1835. It has been suggested that he absconded from a whaling ship but he may have arrived by way of Sydney, after making contacts among the trans-Tasman business community.
One Sydney merchant who certainly knew Webster in 1835 was Ranulph Dacre. Dacre owned two spar stations on the Coromandel Peninsula, which were managed by Gordon Davies Browne. Webster worked for Browne before setting up his own timber and trading post on Whanganui Island, at the mouth of Coromandel Harbour. Webster and William McLeod bought the island in December 1836 and, when their partnership was dissolved in 1837, divided it between them, Webster taking the northern portion. He chose as his headquarters Herekino Bay, which faced the Waiau, the narrow waterway separating the island from Coromandel Peninsula. He became the Pakeha of Te Horeta, also known as Te Taniwha, of Ngati Whanaunga, and married the chief's daughter. Later Webster was depicted in John Logan Campbell's Poenamo as 'Wepiha, King of the Waiau'.
In the early years Webster proved himself a businessman of ability. He purchased land, imported manufactured goods, tobacco and spirits for local consumption and dispatched timber, potatoes, maize, flax and preserved pork to Australia. He built and operated small ships, acquired a cattle run on Great Mercury Island and a share in a copper mine on Great Barrier Island. He established timber agents and trading posts on several of his properties. His own headquarters at Herekino grew into a small village, attracting the land jobbers who worked the Hauraki Gulf until 1840. At first they got free hospitality, but as their numbers increased Webster was obliged to charge US$6 per week for a berth in his bunk house and meals at his 'table d'hôte'.
Visitors remarked on the hard drinking and disorderliness of the men who worked for Webster. One observer, Dr Samuel McDonald Martin, doubted whether Webster was making a profit. His doubts were probably justified. In late 1840 Webster went to Sydney in order to charter a ship to take him and a cargo of produce to Britain, and thence to America. On the eve of the ship's departure Webster was arrested at the suit of Abercrombie and Company, a Sydney merchant firm who may have advanced the £1,200 with which he had started business. By then he had debts totalling 10 times this amount, and he languished in Sydney's debtors' prison for seven weeks until Dacre put up £12,000 bail for him.
Meanwhile, with the advent of British sovereignty in New Zealand, all Europeans were required to submit their land claims for examination. Dismayed at this, Webster wrote to the United States consul in Sydney, pointing out the disadvantages which American residents in New Zealand would suffer under British rule and hinting that American intervention would be welcome. He suggested that Great Barrier Island (which was included among his claims) would be an excellent site for a naval base: 'I will willingly give it up to the American Government for a very small sum', he wrote.
American support was not forthcoming and Webster reluctantly referred his claims to the Land Commission in 1841. Eventually it was recommended that he receive a Crown grant for 2,560 acres, the maximum that could be awarded without the intervention of the governor. The commissioners acknowledged that Webster had made bona fide agreements for considerably more than this and would have been entitled to at least 7,541 acres were the limit not in force.
Governor Robert FitzRoy and his Executive Council reviewed Webster's claims in April 1844, noting in particular that Webster and his two partners stood to lose their copper mine on Great Barrier Island, which was considered to be an asset to the colony. Grants of 5,000 acres to Webster and 12,655 acres to the persons who claimed lands bought from him were recommended. Webster, Peter Abercrombie and Jeremiah Nagle were confirmed in the possession of 24,269 acres on Great Barrier Island, which they promptly subdivided. Of the lands which Webster claimed to have bought, title to 41,924 acres had been issued to him, or to his assigns, by 1 May 1844. Within a few months of receiving the Crown grants Webster had sold all except his Great Barrier property, which was mortgaged.
Information about Webster's final years in New Zealand is scanty. In 1845 he and Dacre were associated with F. S. Peppercorne in a mining venture on Coromandel Peninsula, and there is evidence that Webster took over the management of Dacre's sawmill at Mercury Bay after Browne was declared insane about 1841. Webster left New Zealand in 1847.
In 1858 he began, in the United States, to seek recompense for the injustices which he claimed he had suffered at the hands of the New Zealand government. In England, in 1873, he appealed to the principal secretary of state for the colonies and was advised he had no grounds for further claims. Webster returned to the United States and on 19 June 1897, at Baltimore, Ohio, he died without having received any satisfaction. The struggle was continued by Augusta J. Webster, whom William had married on 30 November 1868, and later by relatives. The matter was referred to an international tribunal which, on 12 December 1925, finally dismissed Webster's claim.