As October turned into November in 1762, France, Britain and Spain were almost ready to agree on preliminary articles of peace to bring the war to an end.
Britain had undoubtedly won the war and France and Spain had lost. In North America Britain had taken Canada, St. Lucia and the valuable sugar islands of Martinique and Guadeloupe. In India the British had taken Chandalore and Pondicherry and, in Africa, trading posts in Senegal, the island of Goree and on the Gambia. In Europe the French army was defeated in its bid to defeat Prussia and the French navy was decimated. A bankrupt France was ready to come to terms with a war-weary Britain.
Although Spain had managed to stay neutral through much of the war, it had eventually grown alarmed by Britain's conquests and entered the war in 1762 allied with its relative, France, against Britain. In June Britain landed forces in Cuba and laid seige to Havana. By August Havana belonged to Britain as well as all the Mexican bullion stored there. Likewise, in July the British began the invasion of Manila and by October were in control. Despite these losses, Spain was not yet ready to concede defeat.
Prior to Spain entering the war, Britain had been engaged in behind-the-scenes negotiations with France to end the war. By late fall of 1762 the duc de Choiseul, France's principal negotiator, had worked out the outlines of a treaty that would be incredibly generous to France and, incredibly, would allow for a relatively quick post-war recovery of naval power. France had every incentive to take these terms as quickly as possible before William Pitt, former prime minister and hawk, could negotiate a return to power in Britain. Although France would be forced to give up Canada as well as its East Indies and African trading posts, it would keep its profitable sugar islands and Louisiana.
Spain was not pleased that France was ready to capitulate.
Havana was Spain's most important port in the Caribbean, the "Key to the New World". Spain was not going to agree to give up Havana permanently. On the other hand, Britain was not going to give up a prize as great as Havana without gaining something.
As historian Fred Anderson sees it, the solution came through French diplomacy. France needed to make a deal with Spain that would allow Spain to come to terms with Britain.
Choiseul's ingenious answer to this puzzle had three parts. France would give Spain its last remaining territory in North America, Louisiana; Spain would surrender Florida (that is, the territory from the Mississippi to Georgia) to Britain; Britain would return Havana to Spain. In this way Spain would lose its claim to a sparsely inhabited, commercially unprofitable coastal plain and recover the Key to the New World and its trade. As a reward for its cooperation Spain would gain title to the western half of North America, access to the continent's interior via the Mississippi River, and possession of the valuable port of New Orleans. True, France would bid adieu to the rest of its North American holdings; but, as Choiseul understood, the colony of Louisiana had little population and no conceivable value to France if its destiny were to become a buffer between the demographically vital British colonies and the North American holdings of a disgruntled Spain. And Britain would gain undisputed control of the eastern half of North America -- a prize glittering enough to satisfy even the most rabid imperialists in the House of Commons.In the early days of November, 1762, Britain was signaling that it was ready to make a deal. France was working both sides behind the scenes. Pens were poised to put the various parts of the deal on to paper. It was just a matter of a little more time for French diplomacy to work.
_________
Notes:
Anderson, Fred. Crucible of War: The Seven Years War and the Fate of Empire in British North America 1754-1766.
Fowler, William M. Empires at War: The French and Indian War and the Struggle for North America, 1754-1763
Taylor, Alan. American Colonies: The Settling of North America.