May 19, 1908


(Sgd.) R. R. Pattinson. The letter is typewritten but the amount $1,000 is written in with pen, apparently at a time subsequent to the writing of the letter, the signature is made by a rubber stamp. From the endorsement on the original we learn that the $1,000 was in cash. For berth No. 1098 there -were three bidders: a. Aylen & Featherstonhaugh, Fort Saskatchewan $ 300 b. H. and Iv. MacDonald & Frith, Ottawa 1,860 c. The Imperial Pulp Company.. .. 2,500 The tender of the Imperial Pulp Company reads as follows: The Imperial Pulp Co., Limited, Winnipeg, Man., Nov. 7, 1903. The Secretary, Department of the Interioir, Ottawa, Ont. Sir,- Enclosed please find tender for timber berth No. 1098 and bonus for same, $2,500. Yours truly, (Sgd.) THE IMPERIAL PULP CO.


?

Per R. R.@

Pattinson.

Here again the body of the letter is typewritten, the figures setting forth the amount offered as bonus are written in ink and the signature is stamped. The marginal note on the original shows that $2,500 in cash accompanied the bid. These two tenders of the Imperial Pulp Company (1097 and 1098) are so drawn as to render collusion and fraud possible-were such action intended. It would not have been a difficult matter to have filled in the amounts and to have added the requisite cash after the offerings by the other bidders were known.

Berths 1118 and 1119 on the North Saskatchewan river and West Sheep creek have a combined area of 120 square miles. They are of great value, bearing magnificent timber, worth $150,000 or more. The Burrows interest applied in the fall of 1903. The advertisement was issued on December 10, once in the Manitoba ' Free Press ' and once in the ' Albertan ' and the ' Tribune ' of Calgary. But any one will tell you that this district is tributary to Edmonton, it is up the river from Edmonton and the two advertisements issued in Calgary would not reach any Edmonton man who wanted to tender; there was not a shred of an advertisement in any Edmonton paper. Forty days were allowed from Ottawa to Ottawa leaving four weeks net to explore. Even if an Edmonton man had been tendering he would have had to go 150 miles up the river from Edmonton or seventy miles across the hills from Red Deer to get to the limit. It was impossible for him to explore it. As might be expected, when the day arrived there were no tenders except those from the Burrows interest. It would not do to have it go abroad that there was no competition, so A. W. Fraser was instructed to prepare two bids, one in the name of T. A. Burrows and the other in the name of W. H. Nolan, the deposit in each case being in cash. Nolan was awarded the limit and immediately transferred it to the Imperial Pulp Company. Although the Imperial Pulp Company were the owners of this limit within a few hours of its being awarded to Nolan, the fallacy was kepv up In the books of the department for years that Nolan was the owner of that limit.

These two limits cost the Imperial Pulp Company $1,100 and their value must be in the neighbourhood of $100,000 or $150,000. At all events the limits went for $9 per square mile or about one and a half cents per acre, and these are valuable limits at the headwaters of the Saskatchewan.

I wish to refer to one more limit, No. 1122. The award of this limit was accompanied by every objectionable feature which appears in the case of practically every other limit to which I have referred. The applications were called for on November 27, 1903. They covered seven widely separated tracts amounting to 110 square miles, on the McLeod and Pembina rivers. When this was applied for the department acted immediately. The advertisement was issued on December 15, and the bids were to be received by January 22, 1904; that was forty-three days Ottawa to Ottawa, or four weeks net for any one in Edmonton to explore the limits. If you plot out on the map these tracts which were put up at that time for competition, it will be seen that a man would have to travel 450 miles from Edmonton to simply make a tour of the limits without any examination, and as this would have to be done in the dead of winter it was utterly impossible to explore the limits and put in an adequate bid. The country cannot fail to conceive that it was never intended or expected that anybody but men with advance knowledge would bid on that limit. The whole thing was a lottery as far as any one else was concerned. There were four tenders, McDonald & Frith $1,220 ; J. B. Lamont, $4,000 ; Kenneth H. McLeod, Edmonton, $10,025, and A. W. Fraser, (the Imperial Pulp Company) $11,000. The McLeod tender was doubtless put in by Edmonton people who knew more about the limit than any other group, but the offer of the Imperial Pulp Company was $11,000 which just cleared the jump. If you examine the original tenders of the Imperial Pulp Company what do you find ? The offer consisted of a letter written by A. W. Fraser in his own hand, and signed by him. From the marginal notes it appears there were two cheques, one for $5,000 and one for $6,000. The letter was written at the instance of T. A. Burrows and it was handed to him unsealed and the cheques that accompanied it. were those that he supplied. That is the evidence of A. W. Fraser. The Finnie evidence was that there were two managers' cheques that were issued by him in exchange for cheques given by Burrows and that the $5,000 cheque was the first. Look at the facts. J. B. Lamont offers $4,000 ; Kenneth H. McLeod, $10,025. Then on behalf of the Imperial Pulp Company you have one cheque for $5,000 and another cheque for $6,000 and with these two together the limit goes to the Imperial Pulp Company. I ask if that dovetailing does not

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Subtopic:   THE IMPERIAL PULP CO.
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CON

Herbert Brown Ames

Conservative (1867-1942)

Mr. AMES.

indicate that there is design and that this is not merely coincidence. This limit was transferred by Fraser to the Imperial Pulp Company the very next day and it is now found to be covered with dense spruce which is valuable for railway ties and much of the timber on it will be sold to Tailways now going through that country. Look at the file and you will find hundreds of settlers protests against this concession. In fact after four years the government was forced to abandon one of these tracts because the settlers of the whole country rose in arms against having a lawyer in Ottawa keep them out of their own supply of building material.

To recapitulate, the Imperial Pulp Company have nine limits and you will find about every one of them something which is suspicious and which cannot but call for an investigation. As to 1031 I have spoken of the absence of amounts and in the cases of 1052 and 1058 no amounts are stated. 1097 and 1098 were accompanied by cash; 1118 and 1119 give evidence of friendly competition between Nolan and Burrows both representing the Imperial Pulp Company. In the case of 1122, it is perfectly impossible that there should have been any competition. So it is with all the Edmonton reserves for 150 miles around that city, to the value of $750,000. All these limits have been secured by this company which will hold its limits or sell them wholesale or perhaps retail but in any event they stand to make a very large amount.

I have brought to the attention of the House the unique method of tender they followed. The advertisement in the case of each one of these applications quotes the regulations under which a license will be issued and also states that a printed form of tender may be obtained at the land office or from the department. The department indicates to any one who wants to tender that there are regular printed forms and the natural inference is that they expect any on tendering to use those forms. The form of tender is :

Sir,-I hereby offer a bonus of dollars

for a timber berth of square miles selected, for which berth public competition is being invited, and I inclose an accepted cheque on the bank of for dollars, being

the amount of said: bonus

I undertake to comply with all the conditions of the Timber Regulations.

I have the honour to be, sir,

Your obedient servant,

The Secretary of the Department of the Interior, Ottawa.

That is the printed form used in 75 per cent of the cases. It is a form the department furnishes to the ordinary man who makes an application. It states in two places the amount and the bank on which the cheque is drawn. If that form were used in every case, there could be no such

hocus pocus as that in the case of the limits secured by the Imperial Pulp Company.

Mr. Speaker, at the recent meeting of the Canadian Forestry Association in Montreal, a very significant remark was made by Dr. Fernow. He said, 'The forests are the capital of the future not the spoils of the present.' I wish that this remark had been uttered about five years ago and had sunk deep into the minds of those who have the control of our western timber areas. To-day, half the timber areas in these three provinces are in speculators' hands, and for these areas the country has received a mere bagatelle. These forest areas are worth from three to five millions at a fair computation. There was no necessity for the government to put them up for sale at the time they did. There was no possible excuse for disposing of the outlaying areas. One-quarter of the area would have been sufficient, if those portions had been chosen within the range of transportation facilities, to supply the needs of the three provinces. The other three-quarters should have been held by the government until they became valuable, and the increase in the value should have belonged to the people and not have been given to the speculators for a mere song. So, I feel that a great opportunity has been lost ; it has been lost in order that certain gentlemen, close to the government, might become millionaires. And to this end our three new provinces have been despoiled. The day will come when there will be handed over to these provinces the ragged remnants of the lands that should have been theirs long ago. But, before that is done, practically all the timber of value will have been given away. These are the assets that these provinces should have in order to develop themselves and carry on their internal affairs. A short time ago, the provincial treasurer of Ontario brought down his budget, showing that province had derived a revenue of $1,800,000 for the year from a judicious use of their timber supply. And we are not far behind in the province of Quebec. Hon. Mr. Weir, in his report, shows that $1,000,000 a year is received by the province of Quebec from its timber resources.

Yet you propose to shear the provinces of Alberta and Saskatchewan of practically all their assets to give them into the hands of speculators.

Mr. Speaker, the circumstances connected with the tenders we have examined and which I have endeavoured to review before the House lead, to my mind, to one inevitable conclusion, and that is that there has been either fraud or imposition practised in obtaining some of these limits. That belief is general throughout the west. If it is well founded, what is the logical conclusion of the matter ? It is that the country has been robbed and that certain persons to-day are in possession of stolen goods, goods that should be restored to the people of

Canada. Out in the constituency of the hon. member for East Assiniboia (Mr. Turriff) they probably have read the evidence given in the Public Accounts Committee including the hon. member's valuable testimony, which, I am sure, will be ail the more appreciated after what has been said on the floor of the House to-day. We find the farmers there gathering together and moving a resolution, not that there ought to be an investigation-they have got beyond that-but that the timber and coal and other lands which have been unjustly taken away from the people should be restored.

Take up the report of your Civil Service Royal Commission, and turn to what it says concerning the Department of the Interior. The commissioners say that they had not time to investigate that department :

The commissioners regret extremely that with the short time at their disposal they were unable to visit the Northwest, much as they desired to see how the land, and more specially, the timber sales are affected.

The most cursory investigation of the Department of the Interior persuaded the commission that there was need to investigate the way the timber areas had been disposed of. A little while ago we had complaints brought before the government of my province showing that there was fraud in connection with the timber in the township of Boyer, that fake homesteading had beeu going on by speculators who took this means of securing the timber fraudulently. And what did they do in that good old province of Quebec ? They held an investigation ; they found 88 cases in which the timber had been acquired through fraud, and they cancelled every one of those leases, so that the timber came back to the Crown. We have an equally good reason to demand an investigation here and now. I would ask the Prime Minister to give an inquiry by an independent outside judicial authority into this whole question of the alienation of the timber of the Northwest, to ascertain whether these allegations are true or not. And if that were done, .and if what I believe to be true were found to be true, I think the government would be right in taking back at least a million dollars' worth of timber and placing it once more at the command of the public.

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Subtopic:   THE IMPERIAL PULP CO.
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LIB

Theodore Arthur Burrows

Liberal

Mr. T. A. BURROWS (Dauphin).

Mr. Speaker, I find it difficult to follow all the insinuations which the hon. gentleman (Mr. Ames) has cast upon me, and upon the gentleman who opened these tenders, and upon the government for their management of the country's timber resources. The hon. gentleman was so voluble that speaking only from memory and immediately following him, I may not be able to deal with all that he has said. If I do not reply to all the remarks he has made, it will only be because some of them have escaped my memory.

I will first refer to the timber limits which I secured myself and to which the hon. gentleman referred. The hon. gentleman's criticism is very unfair ; if parliamentary rules will allow me to use the word, 1 would say it was very mean because it was so unfair. He referred particularly to two limits I secured and tried to cast a reflection upon myself, and tried to misrepresent the conditions regarding these limits. Take, for instance, timber berth No. 10i6 He said that in this case he tried to find out from the bank manager certain facts in regard to the cheque put in. And he insinuated-if the English language means anything, this is what he meant-that I was here in Ottawa and found what the competing tenders were and went to the bank to get a cheque covering a larger amount than the amount of the highest tender. When the matter came up in the Public Accounts Committee, the hon. gentleman made inquiry of the bank manager to see if he had the cheques. The manager said that he had not the cheques, that if he ever had them they were mine and must hare been returned to me. The record shows that it was a Bank of Ottawa cheque that was put in. It was a cheque marked Winnipeg.

Now with regard to that matter, I will add what the hon. gentleman left out. He was very free in making insinuations, insinuations which he had no ground for making. But when it came down to making a clear representation of the facts, the hon. gentleman had not honour enough to do so. Now take berth 1046. Here is the copy of the application, and here is the original cheque. He could have got them from me in tile Public Accounts Committee, but for some reason known to himself, he was afraid to put me into the witness box, he was afraid to let me show my side of the case. I was there, and the chairman of the committee said to him: If you want to find out about these cheques here is Mr. Burrows, put him in the box and he will produce his own cheques. The hon. gentleman was too mean, I will use that word-

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LIB

Robert Franklin Sutherland (Speaker of the House of Commons)

Liberal

Mr. SPEAKER.

Order.

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

I will say unfair then.

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CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER.

Was the hon. gentleman in the Public Accounts Committee himself at the time he speaks of ?

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LIB
CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER.

Then why didn't he take the stand and give his evidence if he wanted to ?

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

The member for St. Antoine went out of his way to subpoena everybody, and Mr. Macdonald asked him to subpoena me if hh wanted to get this information, and he would not do it.

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CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER.

You were there, and you didn't need a subpoena.

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

Mr. BURROWrS. Now with regard to this timber berth 1046, I will read the application, and I defy the hon. gentleman to point out anything wrong with it. In putting in applications for timber, the hon. gentleman knows as well as anybody that in many cases the regular form is not used, lumbermen very seldom have the printed form, and the department do not exact the use of a printed form. But in this case I used the printed form, and I will read it. The tenders were opened on March 7, 1903. Here is my tender, dated Winnipeg, March 3, 1003 :

I hereby offer a bonus of three thousand five hundred dollars for a timber berth No. 1046, containing forty square miles situated near the Pembina river for which public competition is being invited, and I inclose accepted cheques on the band of Ottawa for $3,500, being the amount of said bonus. I undertake to comply with all the conditions of the timber regulations.

I inclosed two accepted cheques on the Bank of Ottawa, and both cheques were marked good by the Bank of Ottawa in the city of Winnipeg. Both were dated on the same day, that is 46 days previous to the opening of the tenders. The application was in proper form, it specified the total amount of the tender, and the cheques were inclosed and sent to Winnipeg. I think that is clear enough.

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CON

Edward Arthur Lancaster

Conservative (1867-1942)

Mr. LANCASTER.

Why did you make two cheques instead of one ?

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

The hon. gentleman was in the Public Accounts Committee when that matter was investigated, and he heard what the solicitor said with regard to it. In putting in tenders, lumbermen well know that the amount of a tender often becomes known. A competing tenderer could go to the bank and ask for the amount of my cheque. If the amount is known, and if there is a competing tenderer who wants to get a cheque at the same time, it is possible that one man may find out what another man's tender is.

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CON

Frederick Laurence Schaffner

Conservative (1867-1942)

Mr. SCHAFFNER.

And none of the rest of the tenderers know anything else about that ?

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

They do, that is just where the hon. gentleman is wrong. I will give him an instance. Mr. Fraser has acted for myself in regard to timber matters, he has acted in regard to the Red Deer Lumber Company, and he has acted for himself and his friends, because he is interested in the timber business. He was asked to say why more than one cheque was put in the tender, and here is what he said :

It is a pretty hard question, except in a general way. I have known clients who had an idea that by varying the cheques, by taking them from different banks and putting different amounts in, it would prevent the amount of their tender leaking out. They

have an idea, rightly or wrongly, that in getting cheques marked in the hank it 'might leark out what the amount of their cheque was.

Q. Leak out from where, from the bank?-A. Irom the bank. I have had cases where clients have sent cheques through the bank to me to put in with their tender, and have come along themselves and supplemented that cheque and asked me to put in an additional amount beyond what they had sent through the bank to inclose with their tender. As to their motives or reasons for doing so, I am not here to say so far as my practice goes that has not been confined to one individual, it has been adopted time and again by different clients.

Now that is quite understandable. The hon. gentleman who interrupted me asked me if anybody else did it. I will give him a little information in regard to some parties whom probably he knows. It is in regard to timber berth 1275. which was put up for public tender. W. Anderson, of Ottawa, manager for J. It. Booth, tendered one cheque of $15,050 ; and II. Finger, of Port Arthur, tendered $15,000, and inclosed cheques for $10,000, $2,000, $1,000,$1,000 and $1,000 making$15,000 in all. Now this circumstance proves two things; it proves that it is the practice of lumbermen to put in more than one cheque ; it also proves that tenders are often very close to each other. In this case there was only $50 between the two tenders, although they were for the large amounts of $15,000. I am sure that if I had been the successful tenderer, the hon. member for St. Antoine would have been examining the tenders with a microscope, and he would have insinuated on the floor of the House that I had been doing something wrong.

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CON

Herbert Brown Ames

Conservative (1867-1942)

Mr. AMES.

If there were twenty cases like that, I would.

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

Here is another case. Take timber berth 360, that was old berth No. 208 on the Columbia river, B.C. Two tenders were put in very close to each other. One was by M. A. Anderson, manager of the Imperial Bank, on behalf of the Columbia River Lumber Company, for $20,Gil. The competing tender was put in by a firm of Ottawa barristers, Wyld & Osier, who I understand are Conservatives. They tendered on behalf of Messrs. Doherty, Ben-nis, Bird and Newton, of Bradford, Pennsylvania, and sent in two cheques, one on the Ontario Bank for $13,000, and one of the Molsons Bank for $7,5G6, making $20,-56G.G5, or only $44.35 higher than the unsuccessful tenderer. This instance also proves that it is possible for two tenders to be very close together. I do not wish to insinuate that there was anything wrong in tliis case, far from it ; but it proves what I have said, that even large tenders are sometimes remarkably close together. This case also proves that the firm of Wyld & Osier, in the city of Ottawa, apparently knew how to conduct their business. They 278

not only put in two cheques, but they were not satisfied with one bank, and they put in one cheque on the Ontario Bank and another on the Molsons Bank.

I am referring to this point to show that it is a practice that is knwon to public men and governments. It is a practice among lumbermen and apparently it is a practice amongst lawyers. The hon. gentleman made some insinuating remarks about the fact that tenders were put in in other people's names, but he, himself, before he sat down, told us of the instances in which McDonald Bros., of the city of Ottawa, put in a tender for berth No. 1108 in the name of James Currie. It is quite a common occurrence and I do not know that it suggests any idea of wrong-doing. Here is another instance. Timber berth No. 1388 was put up during last year. There were various tenders put in, I think, five tenders altogether. I know something about this berth myself, because it was applied for by a gentleman who was my competitor in the lumbering business in Dauphin, Mr. Shaw. There was also a competitor in another gentleman who resides in the same district. Mr. Shaw tendered, in his own name, $430 and tendered, in the name of a broker in Ottawa, $6,300. Why did he do that? He aparently first put in a small tender in order that if anybody found out the amount of his cheque he would not find out the amount of his actual tender and then he came down to Ottawa and got a broker to put in another tender in the broker's name. I am not making any insinuation against Mr, Shaw. He just did what lumbermen do in a case of that kind.

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An hon. MEMBER.

Where does he live ?

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LIB

Theodore Arthur Burrows

Liberal

Mr. BURROWS.

He lives in Dauphin and he is a good Conservative. He is a most respectable citizen and I am casting no reflection upon him at all. He did what I probably would have done myself. There were three cheques inclosed in one of the tenders in that case. Take another instance, berth 333 situated in British Columbia. There were a great many tenders for that limit. I believe it was a valuable limit. It was situated on the Arrow lakes and it contained large British Columbia timber. One of the competing tenders amounted to $25,225, made up of cheques for $10,575, $7,650, $4,000 and $3,000.

Mr, BRISTOL. Will the hon. gentleman tell me where he got all his information from and whether these are all the cases that have occurred in the department?

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May 19, 1908