June 1, 1908

CON
LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

I did not intend to. I stated that I had an interest and then I introduced two or three sentences between that statement and the discussion of what that interest was. Then I resumed and said : I said I had an interest-and then I explained what the interest was.

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

Then I take it that the hon. gentleman denies that he has any interest in this business except his interest as a public man

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LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

Precisely.

Mr. FOWLER-in something that he believes to be for the benefit of the country. All I can say to that for the moment before I analyse the evidence is that the hon. the Minister of Militia and Defence has manifested a greater and deeper personal interest in this particular line of business for the improvement of the country than he has in any other line in which only his general interest as a public man is concerned.

I was speaking of the history of this case. It began, as I say, with the application that was made to the Minister of Marine and Fisheries by F. E. Williams. The negotiations between Mr. Williams and the Minister of Marine and Fisheries continued for some time. Finally the Minister of Marine and Fisheries shunted Mr. Williams and his application off on the Minister of Agriculture. We find that on October 13, 1906. about a year after the Williams application was first made to the Department of Marine and Fisheries-and it seems to me that that application having been made to the Department of Marine and Fisheries and passed on by that department to the Department of Agriculture it should dat< from the time it was made to the Department of Marine and Fisheries which beyond all question would make Mr. Williams the first applicant for the subsidy for the city of St. John-a company was incorporated called the Canada Lands, Produce and Cold Storage Company, Limited.

As I understand it, the moving spirit in the Incorporation and formation of that company was the Minister of Militia and Defence. I understand that the Minister of Militia and Defence will not deny that and in fact although the minister is not included among the incorporators, nor is Mr. Macoun his son-in-law and another of the active spirits in the promotion of this company, although the names of the incorporators are simply men of straw used for the purpose of the incorporation of the company, clerks and the like of that-

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LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

Clerks in the law firm that got out the charter. .

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

Yes, that is the common way of incorporating these companies; afterwards the true people come in and take up the stock.

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LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

As a matter of fact the company was never organized.

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CON
LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

Yes. It is only fair to say that Mr. R. J. Graham, the other gentleman to whom my hon. friend referred as having been interested

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

Will refer.

Sir FREDERICK BORDEN-agreed, in case the company were finally organized, to become the managing director of the company but that point was never reached.

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

We find then that the Minister of Militia and Defence and his son-in-law, Mr. Macoun, and Mr. Graham were the moving spirits in connection with the incorporation of this particular company. That was on October 13, and on December 4 the Minister of Agriculture announced in the House his intention to give a subsidy of 30 per cent on the cost of cold storage plants. That 30 per cent was to include not only the cost of the building, but the cost of the site as well. That is a matter of some importance and I remember that when this matter was introduced by the Minister of Agriculture in the House I opposed the inclusion of the cost of the site in reckoning the amount of subsidy to which the builders were entitled, because in many instances free sites would be given -and just that same case arose here.

I have no doubt that when the cost of this building was made up, for which the amount of subsidy was asked, the value of the site was included.

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LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

I do not think so.

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

I think it was, and in addition to the value of the site being included, I think there was included the amount of stock given to the gentlemen 2974

promoting the New Brunswick Cold Storage Company ; because any one who has seen those buildings must come to the conclusion that no amount of $150,000 could possibly have been expended upon them, not even on a government contract. On the 4th of December, 1000, as I have stated, the Minister of Agriculture announced his policy of paying 30 per cent to those who established cold storage plants throughout Canada. On the 5th of December, 1906, the very next day, an application was made by L. S. Macoun for aid for a cold storage plant in the city of St. John. He did not lose much time in getting in the application. It would almost look as if the application were waiting to be put in-waiting for the announcement to be made, with the knowledge that it was to be made. That may not have been the case ; I am only saying what it looks like. Mr. Williams did not lose much time, although he had no means of knowing beforehand the policy of the Minister of Agriculture; for we find that on the 7th of December, 1906, three days after the announcement to the House, in which there was time for the announcement to be telegraphed to St. John, Mr. Williams put in his application to the Minister of Agriculture. Negotiations then proceeded between the parties. There was a considerable volume of correspondence between them, but nothing of very great moment until we come to the 11th of June, 1907, when Mr. R. J. Graham applies for the bonus, the same gentleman who was interested with the Minister of Militia in the Canadian Lands and Produce Company, the abortive company that died stillborn Up to this time Mr. Graham, Mr. McAvity, Mr. A. I. Trueman and others, who were interested in what was known as the New Brunswick Cold Storage Company, were at arms-length with each other. One party had the ear of the provincial government, through a former partner of Mr. Trueman, who was at that time at the head of the provincial government of New Brunswick. There are people who are suspicious enough to say that the name of A. I. Trueman, though it appears there, was really only used for the name of somebody else.

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LIB
CON

George William Fowler

Conservative (1867-1942)

Mr. FOWLER.

Ask him and you will find out. I am not referring to anybody ; I am simply saying that there are those who say that the name of Mr. Trueman was used for somebody else, they do not say for whom. They leave that to the imagination of other people, and my hon. friend has a very vivid imagination when it suits him, and he can perhaps supply the name of the other person. I say that at that time the two parties, the one having the ear of the provincial government, and the other, com, posed of the Minister of Militia, Mr. Macoun and Mr. Graham, having the ear of

the federal government. They were not working in harmony. That was on the 11th of June, 1907. But between the 11th of June, 1907, and the 17th of August, 1907, a change took place. They felt that it would not be well to fight, because if they united together, they could better divide the spoil among them. They were getting 30 per cent from the federal government and those who took the provincial subsidy were to get $00,000 towards their plant.

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LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

Oh, no ; a

guarantee of bonds.

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CON

George William Fowler

Conservative (1867-1942)

Mr. FOWEER.

Bonds and interest guaranteed-practically the same thing. If they made money, all right; if they lost, the promoters would not lose anything. Well, they thought it best to join forces and put up a plant. With the $60,000 that they were to get from the provincial government by way of guarantee of bonds and guarantee of interest, and with the $30,000 of subsidy from the Dominion, supposing the plant would cost $100,000, they would get $90,000. This would mean that they would only have to put up $10,000. But we know how these things are worked. They are worked in a variety of ways. By the padding of accounts, by the putting in that for which no money has been paid, such as good will, and that sort of thing, it would be possible to bring the cost of the property up so much that the $60,000 and the 30 per cent would more than cover the cost of the building, leaving a decent margin to the gentlemen who were engaged in the promotion of the company. That something like this did occur we have evidence in the letter of Mr. F. E. Williams to the Prime Minister. Opposed to that we have the absolute denial of the Minister of Militia as to any conversation having taken place between them. Now, I do not propose to judge between these two men-the one a prominent Liberal and merchant of good standing and character in the city of St. John, the other the Minister of Militia, a gentleman enjoying the confidence of his constituents in the province of Nova Scotia, enjoying the confidence of his colleagues in the government, and it is presumed enjoying the confidence of a majority of the members of this House. We have the two statements diametrically opposed, Mr. Williams asserting that the Minister of Militia said to him that by the uniting of forces, by getting an amalgamation of the St. John party, who had the ear of the provincial government, with the Ottawa party, who had the ear of the federal government, they would be able not only to build this plant with the subsidies and subventions, but divide a decent profit as well.

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LIB

Frederick William Borden (Minister of Militia and Defence)

Liberal

Sir FREDERICK BORDEN.

Is that statement attributed to me ?

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CON
CON

June 1, 1908