May 6, 1909

?

To Arthur I.

Trueman, solicitor of

company, 171 bonds 85,500

To Bank of New Brunswick, in addition to above, 132 bonds 66,000

(Sgd.) WM. PUGSLEY,

Attorney General.

August 6, 1903.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   WM. PUGSLEY.
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The Arthur I.

Trueman referred to here was the solicitor of the company and the partner of the Minister of Public Works. That statement bears date the 6th of August, 1903. So that, over the signature of the Minister of Public Works we have the evidence that there were issued and guaranteed at that time $338,500 of these bonds. By the Act of 1903 that I have already quoted, the government could not guarantee any bonds for the purchase of the Central Railway * until the title was completed and vested in the government. The deed of conveyance to the coal company bears date the 21st of August, 1903. So that, even in respect to the further issue of $200,000 which, the Minister of Public Works states, is included in the $338,500, there was an illegal guarantee of bonds. But, take the minister's own statement, give him the $200,000 as having been issued, admit that the whole issue of $200,000 was exhausted on account of the pur-[DOT] chase of the Central Railway, and we have $138,000 of bonds which were issued and guaranteed to that date, the 6th of August, on account of the fifteen-mile section. That, Mr. Speaker, is just exactly what the commissioners say in their report, a statement which the Minister of Public Works has characterized as being absolutely false.

Furthermore, there is another memorandum in addition to the memorandum that I have already read, at page 519, to this effect:

Bank of Montreal, St. John, New Brunswick.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   WM. PUGSLEY.
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MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.


That is later than the 6th August. November 6, delivered to Arthur I. Trueman, 40 bonds $ 20,000 November 16, delivered to Dr. Pugsley, 40 bonds 20,000 December 23, delivered to Arthur I. Trueman, 30 bonds 15,000 January 20, delivered to Dr. Pugsley, 8 bonds 4,000 January 29, delivered to Dr. Pugsley, 105 bonds 52,500 Now, that exhausted the whole issue of $450,000 of bonds. Every one of these bonds was guaranteed, with the exception of the last $52,000, before the Act of 1904 was passed which authorized the guarantee without respect to mileage. That Act was passed on the 18th day of April, 1904-that very suspicious Act which I submitted to the attention of the House last night, an Act which related to another railway entirely distinct from the New Brunswick Coal and Railway Company, but which, in its last section, which scarcely any lawyer and certainly no layman in any legislature would understand, and passed on the last day of the session, provided that the bonds of the New Brunswick Coal and Railway Company could be guaranteed without respect to mileage.


CON

Robert Laird Borden (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. R. L. BORDEN.

That is to say without regard to the cost of the work?

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

Yes, without regard to the cost. But it is a fact and it appeared from the record that every one of these bonds was guaranteed by the government excepting the last $52,500 before the passing of the Act of 1904 on the 18th day of April. The section which authorized the guaranteeing of bonds irrespective of the mileage reads as follows:

If, by reason of the work on any section of said line of railway being or having been found to be more than ordinarily expensive, it is found necessary so to do, _ the provincial secretary, by and with the direction and authority of the Lieutenant Governor in Council, may endorse such guarantee on the bonds required to complete such section and to provide rolling stock therefor, although the amount of such guarantee may be greater than the mileage completed bears to the whole mileage of the line.

I would submit that there is no court in this country which would hold that, even in the face of that section as it exists on the statute book to-day, the government were authorized to exhaust the whole issue of $450,000 or the $250,000 with respect to ' the Gibson-Chipman section. How can it

be so contended, in view of these last words, 'although the amount of such guarantee, may be greater than the mileage completed bears to the whole mileage of the line'? That provision must be read with reference to the former legislation which provided, in the first place, that there should be no guaranteeing until the whole line was completed and as modified by the Act of the following session which provided for progress estimates upon a pro rata basis. But, I say that even to-day, with the law as it stands on the statute book, the exhausting of the entire issue of $250,000 was a distinct violation of the statute which the Minister of Public Works or no other lawyer in this country can justify for one moment. I want, in reference to the minister's statement as to the guaranteeing of the bonds and the incorrectness of the commissioners' finding, to refer to the evidence of Mr. Shadbolt at page 267. Mr. Shadbolt, as I have said, was the manager of the Royal Trust Company, the institution which was looking after the substitution and exchange of the three per cent bonds for the four per cent bonds. His evidence is as follows:

I think the whole issue was guaranteed by the government, that is my understanding of it.

There is the statement of Mr. Shadbolt who was the custodian of all of the $250,000 of bonds that it was his understanding that the whole issue had been guaranteed on the 6th day of August, and that, Mr Speaker, is the statement which the com-mision have put in the report and which the Minister of Public Works has stated was false.

Q. A guarantee was placed on the bonds?- A. Yes.

That is Mr. Shadbolt's evidence conclusively that the guarantee of the province was placed on all those bonds on the 6th of August, 1903. Then, an interesting question arises with regard to the disposition and the use which was made of these bonds. In that connection I wish to put before the House the evidence of the Minister of Public Works himself, when he was on the stand before this commission in the month of December last. At page 720 of the evidence, I quote the Minister of Public Works:

Q. On the 6th of August I see a letter by you to the bank of Montreal in which you say you will please deliver the bonds of the New Brunswick Coal and Railway Company guaranteed by the province as follows, to the bank of Montreal $70,000, to the bank of New Brunswick $20,000, to the bank of New Brunswick $20,000, to the People's bank of New Brunswick $70,000, to the bank of New Brunswick $66,000, A. I. Trueman $85,000. Can you tell us have you any record as to what these bonds were given to the bank of Montreal for?-A.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

Q. Does that tell what became of the money which came from the bank?-A. It would tell you that the money went to the company. Then I presume Mr. Allen, the secretary, or Mr. Winslow would have an account of it.

That presumption of the Minister of Public Works is quite erroneous for neither had an account of it.

Q. Mr. Allen and Mr. Winslow have both passed over to the great majority?-A. Yes.

Q. To come to the next one, 23rd December, I see where Mr. Trueman got $15,000 of bonds, do you know what was done with them?-A. On my order?

Q. Yes.-A. They were for the purposes of the company.

Q. What was done with them?-A. I cannot tell you now from memory.

Q. You have no record to show?-A. Tell mo the numbers of the bonds and I have no doubt I can go to the bank and see the records.

Q. That would .not show the disposition made of the money?-A. It would show whether these bonds were used as collateral.

Q. Only to what loan put up as collateral, not to how applied?-A. It would not show what Mr. Allen, the secretary, did with the money, but it would be traced to the hands of the company.

Q. The ultimate destination you do not know?-A. I could not be supposed to tell you from memory.

That is the kind of evidence which the Minister of Public Works, the gentleman who negotiated these bonds and the loans on the securities of these bonds, gave to the commission in December last. I ask hon. members to bear that evidence in mind and contrast it with the statement which the minister made here yesterday.

There is another feature commented on in this report, and which I think deserves the attention of the House, and that is the misleading character of the reports which were made to the Lieutenant Governor in Council, on which reports these orders in council were issued for the endorsement of the bonds. The Minister of Public Works complained very vehemently of the reference which is made to the, report that was signed by Mt. Evans, the engineer of the company, on the 2nd of January, 1903, and he read that report in an attempt to show that the commission were wrong in _ their reflections respecting him. The commission referred to only one of these reports. The evidence, however, gives three just such reports as the minister quoted last night, including the one he quoted. The first is dated April 2, 1902, page 143 of the documents. That report states that work had been done under the contract to the extent of $20,029.25. That is all the work the report showed had been done, but there was an attempt made to show expenditures for the purpose of rolling stock _ and

the payment on account of the option for the purchase of the Norton-Chipman branch, which had no right however to

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

figure in the estimate of cost for the purpose of issuing the subsidy moneys on the fifteen-mile section. That is what the commission, I suppose, alluded to. There are two or three pages of that report having reference to this and other matters having no relation to the question of issuing subsidies. The only amount that did not come under the Act was the money expended on that particular section, $20,229.25. Yet upon that report, prepared by the Minister of Public Works, an order in council issued authorizing the guarantee of $60,000 of bonds on $20,000 of work.

There is another dated the 1st of September, 1902, on page 148. That proceeded, on the same line as the first with respect to the expenditure on the Norton and Chip-man Railway, and sets out that the work down to that time amounted to $67,634, and upon that report an order in council was issued authorizing the guarantee of bonds to the extent of $120,000.

On January 2, 1903, and that is the report of the Minister of Public Works I have referred to, there was a statement of work only to the value of $74,574, and on that the recommendation was made that bonds should be issued to the extent of $140,000.

From the report of September, 1902, to the report of January, 1903, there had been less than $17,000 of work performed between these dates, yet there is a report recommending an increase on the bond issue to the extent of $20,000.

These reports the commission characterizes as misleading, and no one can read them without coming to the conclusion that they were made for the purpose of procuring an issue of bonds against the spirit and letter of the Act. So that the Minister of Public Works is as far astray in this as in almost every statement he made in connection with these matters.

Now, I come to what I consider the most grievous accusation contained in this report, the one to which there can be absolutely no reply, and in respect to which I say it is a disgrace that any one guilty of the conduct therein charged should remain in the government of Canada in control of its greatest spending department. I refer to the statement regarding the misappropriation of $39,000 in respect of the purchase of the Central Railway, and I am going to read what the commission say with reference to that. It will be found on page 51 of their report.

Mr. Evans stated the small ledger was all he had seen out of the wreck in the way of books, and the others must be at Hampton showing expenditures. These, however, could not be found.

He swore that the above $146,409.03 was all he ever got under his agreement with the New Brunswick Coal and Railway Company to pay him $180,000. What became of the balance, in

round numbers $39,000, he could net tell and would not even attempt to surmise. He made several earnest attempts to get this balance which he thought was due him, but was told he did not give a complete title, &c., and getting tired out after a time, he accepted the last payments as a settlement.

It was stated in the House of Assembly the full $180,000 was paid for the Central Railway.

This statement was made with the full knowledge that some $39,000 of the $180,000 had not been paid and was not to be paid. It was known besides that Mr. Sharpe had preparod under instructions, a statement that the full amount of $180,000 had been paid, and such statement was allowed by the government to be put on file at Fredericton without correction. In an order in council dated July 12, 1904, prepared, we believe, by the Hon. Mr. Pugsley, it was declared that this $180,000 had been paid for the railway from Norton to Chipman. These statements were made although Mr. Pugsley had participated in the negotiations with Mr. Evans by which the amount, about $39,000, was abandoned, and we cannot conceive how such a fact could "have been forgotten by Mr. Pugsley.

I ask you if any more serious accusation could be made against any public man than that contained in the quotation I have read. It charges misappropriation of Public Works participated in the negotiations in this connection, that he had the full knowledge of the facts; and although the commission does not say that the misleading statement in the legislature was made by Mr. Pugsley, I will prove from the record that it was. Let me say that, from my reading of the evidence, if the commission have erred at all in this case, it has been on the side of leniency. There are many matters in that report upon which they could have framed a strogner indictment than they have done. The commissioners do not mention Mr. Pugsley as having made that statement, but I shall show that he did make it, and made it twice. Not only did he do that, but, as a member of the government, he allowed to be placed on file a statement prepared by Mr. Sharpe, under instructions, in which that false allegation appears. I have already read the evidence of Mr. Pugsley himself in which he, said that he gave the data and papers to Mr. Sharpe, and I can give a further quotation in which he admits that he himself instructed Mr. Sharpe with regard to the preparation of that statement. Furthermore in an order in council, drawn up by the Minister of Public Works, when he was attorney general of New Brunswick, I find that false and fraudulent statement, and of course it was made with his knowledge. Can there be any more serious charge presented against any public man? It is completely confirmed by the evidence. Mr. Evans had been manager of the Central Railway from Norton to Chipman a number of years. The stock in that railway was held by

Clarke and Company and Drexel and Company, bankers of Philadelphia. They held 6,3654 shares of the total capital stock and in addition $545,000 worth of bonds. The road was losing money very rapidly and in the spring of 1900 the owners came to the conclusion to cease operating, Mr. Evans, who had been managing the road for them, obtained an option from Clarke and Company and Drexel and Company for the whole road, 45 miles, rolling stock, franchise, &c., and in addition another railway known as the St. Martin and Upham Railway, for $50,000. Then the New Brunswick Coal and Railway Company was shortly after organized. Whether it was organized in connection with this scheme is not made clear, but there is much in the evidence to justify the conclusion that this fact was known at the time of the incorporation of that company and that it was part of the scheme. However, after a time the New Brunswick company obtained from Mr. Evans, who had this option on the two railways for $50,000, an option on the Central line for $180,000. That option was obtained on the 28th of August, 1901, and it provided for the payment by the New Brunswick Company of $180,000 in the following manner: $15,000 in one month from date, which would be due on the 1st October; $15,000 in five months from date; $15,000 in 12 months from date; and $15.000 in 15 months from date, and the balance, $120,000 in two years. That was the agreement entered into between Evans and Elkins and the coal company. Mr. Evans stated that after a time that agreement was modified and it resulted in an agreement being entered into by which Evans and Elkins were to pay a large amount for improvements and betterment, amounting 1 think to $50,000. But the upshot of the whole thing was that, after a number of payments had been made, this amount of $39,000 was abandoned. Mr. Evans, as stated in the report did not receive $180, 000, or within $38,000 of that sum I will quote from the evidence, so that there will be no mistake:

In addition to that the company was to assume the management of the road and operate it, and as soon as_ the other fifteen miles was completed and in running order? -A. Yes.

Q. They had to bear all the expense of maintenance of way while they were so operating?-A. Yes.

Q. I find no provision that you, in the meantime, were to lay out and make any expenditures on the road, you and Mr. Elkins, capital expenditures?-A. That is correct, there was nothing in the agreement.

Q. That is the only agreement you had, including all the terms of the agreement between you?-A. I want to say, that there was an understanding that I should put the road

in shape, between me and the company, there was a sum mentioned, I think, but it was a moral obligation on my part to put the road in as good shape as I could.

Q. There was a sum mentioned between you and the Coal and Railway Company, which would be the amount of expenditure you were to make on the road?-A. Yes.

Q. Do you remember what the amount was? -A. 1 think it was about $50,000.

Q. That was not in writing?-A. No, it was an understanding I had.

Q. A loose understanding, not put in writing?-A. Yes.

Q. Dp to this time a considerable portion of this $50,000 had been expended in August, 1901?-A. That $50,000 was to extend over and include the indebtedness on the road; I had to assume the indebtedness existing on the road when Clarke & Co. gave us their option.

So that, perhaps, I should correct the statement. The understanding was not subsequent, as I stated, but seems to have been collateral with the original agreement that Evans and Elkins should make these expenditures on the road, although it was not put in writing. Then, at page 368:

Q. You paid the expenses on the road after you had given the option to the New Brunswiok Coal and Railway Company?-A. Yes.

Q. From recollection can you say what the amount of those expenditures were?-A. The total expenditures up to the time the New Brunswick Coal and Railway Company took it over was somewhere about $77,000.

Then, at page 369:

A. The New Brunswick Coal and Railway Company took it over the 1st of August, 1902, I think.

And on the same page:

A. I was financed by myself personally, by Mr. Elkins personally, and by the two of us jointly and by moneys we received from the New Brunswick Coal and Railway Company, from time to time.

Tiien, at the following page, which appears here as 520, not 320, apparently a typewriting error:

Q. Are you able to give, us the moneys you actually received from the New Brunswiok Coal and Railway Company?-A. I can, using

the books.

Q. With the aid of this book, can you give us the moneys you actually received from the New Brunswick Coal and Railway Company? -A. Yes.

Q. And the dates at which they were received?-A. I take it for granted that the dates are the dates they were received.

Q. You can, from this book, tell us the moneys you got from the New Brunswick Coal and Railway Company?-A. Yes, up to that time.

Q. Call out the moneys you actually did receive. (Witness refers to book and gives the following figures):-

October, 1901 $12,500 00February, 1902

9,500 00July, 1902

5,000 00

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

September, 1902 $ 5,000 00

October, 1902

5,795 00November, 1902

3,000 00December, 1902

2,000 00January, 1903

3,750 00February, 1903

3,500 00March, 1903

3,000 00April, 1903

15,000 00June, 1904

22,224 06

Q. Since that date, have you received anything since June, 1904 r^A. There was $.37750 and $5,000. I am not getting that out of the book.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
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Hector Francis McDougall

Mr. MACDOUGALL.

Have you the dates for that?-A. No, I am just giving this out of memory.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
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Henry Absalom Powell

Mr. POWELL.

That makes a total of $83,519.06. Take the first amount, $12,500, I see a statement in the recital in an order of council that $15,000 had been paid you at that time, what about that?-A. I only received that amount.

Q. Did the cheque drawn for $15,000 come to you, do you know?-A. No, I don't know whether it was cheque or in cash. But if it were a cheque it would be for that amount, $12,500.

Q. At any rate that is all you got?-A. Yes.

Q. Did you give a receipt for $15,000?-A. I don't know, sometimes a receipt was given and sometimes not. If I gave a receipt it was for $12,500.

Q. I see also there is an entry of an amount you had received, another $15,000, that is stated in an order in council, is that correct, second payment?-A. The second payment was $9,500.

Q. You find these books to be correct?-A. I do.

Q. The second payment of $15,000 would be due under the terms of the option, it was not paid to you at that time?-A. No.

The order in council stated that he had been paid $15,000.

Q. I see that by the records you are credited by Mr. Shadbolt, who was acting for the Royal Trust Company, acting as agent for Drexel & Company, with a payment of $55,800, I think?-A. The option was for $50,000. I borrowed $5,000 from them, I was in need of money and borrowed that from them.

Q. Do you remember that that $55,000 was paid by you to the Royal Trust Company for Clarke and Drexel?-A. Yes.

Q. And some interest?-A. Yes, I think it was $800.

Q. Paid in settlement of the option you held from Clarke and Company and Drexell and

Company?-A. Yes.

Q. You then received from them on that payment, from the Royal Trust Compnay, the stock that you had the option for, and the bonds you had the option for in connection with the Central Railway?-A. I presume they were turned over to the New Brunswick Coal and Railway Company.

Then, at page 574:

Q. How much cash did you get from the Coal and Railway Company in connection with the sale to them of the Central Railway Company?-A. $74,769.06 and $3,750 and $5,000.

Q. Altogether the cash received by you from

the Coal and Railway Company was $83,519.06? -A. Yes.

Q. In connection with the sale to the company of the Central Railway Company?-A. To the New Brunswick Coal and Railway Company, yes.

Q. You told me that, in addition to that, there was an amount that was paid in to Clarke and Company and Drexell and Company in satisfaction of your option of $55,-000?-A. Yes.

Q. That made a total of cash?-A. $139,319.06.

Q. That is correct?-A. Yes.

There is the statement of Mr. Evans that the total sum paid to him under the agreement with the Coal and Railway Company was $139,319.06, and that statement was never controverted by any witness who was examined before the commission, and indeed, it was known to Hon. Mr. Pugsley himself, as I will show by quoting from Mr. Pugsley's own evidence.

Q. In addition to that, did you either, as cash or in any other consideration receive from the company anything on account of the sale?-A. Yes.

Q. What are the two items and dates (refers to book) ?-A. June, 1904, $1,089.97.

Q. That was an amount incurred as a liability to the Intercolonial Railway when you left? -A. Yes.

Q. One amount is Intercolonial Railway, $1,089.97?-A. Yes.

Q. What is the other amount?-A. Vouchers, $1,570.85 in June, 1904.

Q. Explain this item, Intercolonial Railway? -A. It was a matter of indebtedness to the Intercolonial from the Central Railway, a matter of the Central Railway Company under the option due the Intercolonial Railway.

Q. That under the option you should have paid?-A. Yes.

Q. Now, then, this $1,570.85 is vouchers, explain that?-A. There would be sundry accounts.

Q. Incurred which had not been paid?-A. Yes.

Q. Which you, under the option, should have paid?-A. Yes.

Q. These two items you should have paid, amounting to $2,660.22?-A. Yes.

Q. So that, adding these two items

One of which was not paid for, Mr. Speaker.

-if the Coal and Railway Company has paid these two items, the total amount you have received in cash and otherwise from the company in connection with the sale of the Central Railway is $141,679.82?-A. Yes.

Q. Outside of that, did you receive, directly or indirectly, from the Coal and Railway Company, any money or other consideration in connection with the sale of the Central Railway?-A. No; I take it for granted that these figures are correct.

Q. Then, as I understand it, there is a balance of $38,028.12 in connection with the sale of the Central Railway to the New Brunswick Coal and Railway Company, which you have never received?-A. Yes.

Q. The last payment you received was in June, 1904?-A. Yes, according to the book.

At one o'clock the House took recess.

House resumed at three o'clock.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

Mr. Speaker, at one o'clock I was quoting from the evidence of E. G. Evans in regard to the amount that was paid for the Central Railway from Norton to Chipman, and I desire to put on record one or two further extracts from his testimony. At page 593 he was asked this:

Q. You say you had negotiations with Mr. Pugsley and others. Did you ever ask for the balance of this sale of the Central Railway- $38,000?-You knew you were to get $180,000? -A. Yes.

Q. You know that amount was voted by the legislature of the province?-A. Yes.

Q. You understood that $180,000 was charged as having actually been paid to you and Mr. Elkins?-A. I don't know that.

Q. Notwithstanding all that you say, all you ever got was this $140,000, odd?-A. Yes.'

Q. All you ever got?-A. Yes.

Page 594:

According to the contract, $15,000 in two months, $15,000 again, $30,000 and $15,000, none of these were made on time, I could have cancelled the agreement if I had wished, under the agreement because the agreement was never carried out.

Q. You were worried and simply threw it up?-A. Yes.

Q. Threw it up, without being paid any more than $140,000?-A. Yes.

Q. Have you any idea who got the balance? -A. Not the slightest.

Q. You knew the province had paid it?

I wish to call the attention of the House to that evidence in view of the statement made by the Minister of Public Works in answer to a question which I put to him that the deductions from this amount were made by arrangement between Mr. Evans and Mr. Allen. The minister stated that distinctly. There is Mr. Evans' evidence. When he is asked:

Have you any idea who got the balance?

He says:

Not the slightest.

Q. Have you any idea who got the disposition between the $12,500 and $15,000?-A. No.

Q. No information?-A. No.

Q. No belief about it? (Objected, Mr. Car-veil.)-A. I can't say what I don't actually know.

Q. You have no information about the matter?-A. No.

Q. Neither you or Mr. Elkins got it, you are positive about that?-A. Yes, I am positive; I don't think Mr. Elkins did, for I would have known if he did.

At the bottom of the page the chairman asks:

Q. Can you, from the figures, give us just how much you did receive out of that $180.000? Was there an understanding with somebody as to what you did receive and that there was a balance, or does it still stand in that way?-A. I understand the matter is

closed. I would be perfectly willing to receive it.

Page 594:

A. The matter was discussed with two or three parties.

Q. Who were they?-A. I think Mr. Allen, Mr. Trueman and Dr. Pugsley was another.

The chairman.-You afterwards gave them to understand that the thing was closed, you did not expect any more?-A. Yes.

I think, Mr. Speaker, that that evidence is pretty conclusive upon the question as to the amount that was actually paid for the Central Railway. The evidence was not disputed by anybody. There was no pretense made by the Minister of Public Works, or by any witness who was examined before the commission last summer, that this statement was not based upon fact and no attempt was made to dispute the statement in any single particular. It must be, I submit, taken as indisputable that only that amount of money was paid to Mr. Evans for the option on the Central Railway between Chipman and Norton. Mr. Evans could not have been more emphatic or explicit than he is in his statement as set out in the testimony which I have now read. Further, in Mr. Evans'evidence, to show that these negotiations were carried on with the knowledge of the Minister of Public Works, we find, at page 597, the following:

Q. Do you remember with whom negotiations were had by you with respect to the abandonment?-A. No, I don't remember, my impression is, I think there were two or three, I think Mr. Allen was there and Dr. Pugsley, I think so.

There is Mr. Evans' statement that Dr. Pugsley was cognizant of this arangement. But I can establish from the evidence of Dr. Pugsley himself, at pages 712 and 713, that he was fully aware of the abandonment of that sum.

Q. Eventually, Evans was settled with, was he not?-A. Eventually, he was settled with, yes, and Mr. Elkins and they gave an order on the trust company.

Q. Mr. Evans said that he was not paid in full. There was a balance, about $38,000 was struck off from his account, at the settlement?

This is to the Minister of Public Works himself:

A. I can't tell vqu as to the correctness of the amount. I think there is some error, I would not suppose he was not settled with, because the agreement was that the company was to have a clear title to the road, that they did not do and never were in a position to do. Mr. Evans and Elkins were settled with and, I understood, to their satisfaction.

Q- *P1(i you participate in the settlement and negotiations? A. I can't recall that, very likely I was informed of them.

Further on:

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

And I have shown, Mr. Speaker, that these audits were not audits at all. Mr. Corbett, who was examined, stated that he had not sufficient data to make an audit, and he refused to assent to the statement that the statement which he had prepared was an audit, saying that it was simply a statement made on the basis of the information furnished to him.

One of these was F. S. Sharpe, who has since died, and after his death Mr. Corbett, another experienced accountant, completed the work. In that way the government satisfied themselves that everything was bona fide. For a further answer to this question I may say that when the members supporting the government authorized us to go to the limit of $250,000 for the purpose of improving this road made a condition that before any of that money was expended there should be a thorough audit. The government after a complete examination of the accounts advanced the money and has thus taken every possible means of ascertaining the whole truth in regard to this road. I have not the slightest hesitation in saying that no statement could be more false that that made by the ' Gleaner.'

So there were two separate occasions on which the Minister of Public Works, while Attorney General of the province of New Brunswick, made a statement which was false to the legislature of New Brunswick, and the evidence that I have adduced shows that at the time he made it he was aware of its falsity. That establishes the second statement in the indictment. The commissioners also say:

This statement was made with the full knowledge that some $39,000 of the $180,000 had not been paid and was not to be paid. It wa9 known besides that Mr. Sharpe had prepared, under instructions, a statement that the full amount of $180,000 had been paid, and such statement was allowed by the government to be put on file at Fredericton without correction.

Now, what is the record with regard to that? The statement to which the commissioners refer will be found on page 198 of the orders in council and documents in connection with the New Brunswick Coal and Railway Company. It is headed'Approximate Balance Sheet of the New Brunswick Coal and Railway Company as of 31st May, 1904,' and among the assets is the item: 'Central Railway Purchase, $180,000.'

I have already referred to the evidence showing that this statement was prepared by Mr. Sharpe after all the data and information had been furnished to him by the Minister of Public Works and his partner Mr. A. I. Trueman; and further, it appears from the evidence that it was the Minister of Public Works while Attorney General of New Brunswick who particularly instructed Mr. Sharpe to make that statement.

There is this further statement by the commission:

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

In an order in council dated July 12, 1904, prepared, we believe, by the Hon. Mr. Pugs-ley, it was declared that this $180,000 had been paid for the railway from Norton to Chipman.

That order in council is also in the records, and it will be found on page 82 of this volume of orders in council and documents. This is the passage that refers to the payment for the Central Railway:

An audit has been made by Mr. F. S. Sharpe, a chartered accountant, from which it appears that the cost of construction and rolling stock amounts to $368,056.33, and adding to this the amount paid for the line of 45 miles from Norton to Chipman of $180,000, and also $38,892.90, being the cost of improvements made to the Central Railway and charged to capital account.

There is the evidence to justify the third statement contained in that very serious 'ndictment, that an order in council, prepared, they believe, by the Hon. Mr. Pugs-ley, contained that false statement. Then, the commissioners sum up as follows:

These statements were made although Mr. Pugsley had participated in the negotiations with Mr. Evans bv which the amount, about $39,000, was abandoned, and we cannot conceive how such a fact could have been forgotten by Mr. Pugsley.

Now, I ask any hon. member of this House who is disposed to give this question any fair consideration if he has any doubt that the commission were amply justified in every detail of that statement. If that is the fact, then I ask the Prime Minister if a gentleman who has been found guilty, and who is guilty under this evidence, of such a serious offence is a fit and proper person to be in charge of the greatest spending department of the federal government. So much for that which I consider the most serious finding contained in the report.

I propose now to give some few samples from the evidence of how this money has disappeared; and the commission do not set out all the examples that niight have been set out from an examination of the evidence. They set out three or four, but there are at least half a dozen others just as glaring which they have not embodied in the report. I have already quoted the evidence of Mr. Evans as to the payment which he received on account of the first instalment on account of the purchase of the Central Railway. He was entitled to receive $15,000. An order in council had set that out. The evidence I have already quoted shows in the most positive manner that he received only $12,500 of that $15,000. That evidence will be found on pages 590, 591, and 594 of the evidence. So that on the very first payment under this agreement for the purchase of the Central Railway there was a switching of $2,500. Mr. Evans was asked who got that. He

said he had not the slightest idea; and yet the members of this House heard the Min ister of Public Works say last nieht that Mr. Evans arranged with Mr. Allen for the deduction of these amounts so that they could go for other purposes in connection with the railway.

The second instalment of $15,000 was due in February, 1902. I have also read from Mr. Evans' evidence showing that of this he received only $9,500. His attention was called, on page 572 of the evidence, to the statement in an order in council that he had received $15,000 before and also this $15,000; and notwithstanding that, he affirmed most positively that all he had received of the second $15,000 which was checked out of the funds of the Company for that purpose, was $9,500-a switching in that instance of $5,500 from, its legitimate course.

On pages 35 and 36 of the report, speaking of the difference between the aggregate of the discounts that had been made by the New Brunswick Coal and Railway Company at the People's Bank, and the amount that had been received by the James Barnes Construction Company, the commission say:

This difference is pretty well accounted for by three notes; first one for $1,250 discounted January 22, 1902, marked on account A, G, B, of the proceeds of which there was no trace, the second being the fifth note discounted hy the hank, on February 5, 1902, amounting to $25,000, marked on account Evans, and third by a note for $10,000 discounted on November 19, 1902, marked F, P, T. As to the latter, you could not trace what became of the proceeds, but in the case of the $25,000 note, discounted February .5, 1902, above mentioned, we found that the proceeds thereof were placed to the credit of the company, thus opening the only really checkable current account ever kept by the company with the Peoples' Bank.

At page 35:

This account was checked out in seven amounts and closed March 8, 1902. It shows to whom the cheques were made payable, but these cheques were handed to J. J. F. Winslow by the bank on January 19, 1901, and Mr. Winslow could not find them, so he stated. Four cheques amounting to $5,262.68 were made payable to Geo. W. Allen, and we could find no trace of what became of the money. Two cheques dated February 8, 1902, of $1,000 and $15,000, respectively, were drawn payable to E. G. Evans.

So that the House will observe that the $25,000 placed to the credit of the New Brunswick Coal and Railway Company at the Peoples' bank, is the only checkable account of all the transactions of that company. The $25,000 was obtained on account of Evans and presumably destined for the hands of Mr. Evans on account of the purchase of this railway. Yet, Mr. Evans states most positively that all he received was $9,500 out of the $25,000 so marked as his cheque. There were two cheques on that $25,000 after it had been placed to the credit of the company in the Peoples' bank. One svas for $4,000 and the other for $15,000, dated February 5, which were marked in the account in the People's Bank, one was for $4,000 and is the sum I have already referred to, off which there was sliced $5,500 in transit to Mr. Evans. Then the $4,000 seems to have gone astray in toto. So that there were two cheques for $19,000 in all which were presumably intended for Mr. Evans, but out of which he only got $9,500 or only fifty per cent.

Those are two instances which the commission have mentioned in their report, but there are others. There are the notes which were discounted by Mr. Barnes of the Barnes Construction Company and Mr. Pugsley. In the first place there is a note for $13,500, which was discounted at the Bank of New Brunswick on the 3rd of October, 1903. Those were the notes to which I suppose the Minister of Public Works referred when he boasted last night of his having financed a loan to the great benefit of the people of New Brunswick. The commission remarked that they cannot understand the necessity of either Mr. Barnes or Mr. Pugsley endorsing the notes, because the banks held as collateral bonds guaranteed by the province and which were ample security for the advances made. On that day there was a note discounted for $13,500 as will be found in the bank account at page 652 of the documents, and on the same day there is credited to Mr. Barnes only the sum of $10,225.04. The note for $13,500 was to pay on account of the work of the Barnes Construction Company. That company received only $10,225.04, leaving $3,274.76 which was switched in transit.

There is another note to which the commission make no reference. It was given on the 18th of November, 1903, for $13,000, discounted by Mr. Pugsley and Mr. Barnes in the Bank of New Brunswick. It is entered in the bank's account at page 652. Barnes' account is credited only $8,400 on that day or three days afterwards. $8,400 credited on a note discounted for $13,000, leaving a shortage of $4,600. There is another note for $14,000 and this is not mentioned in the report either. It was discounted by Mr. Pugsley and Barnes the 23rd of December, 1903, at the Bank of New Brunswick. It will be found in the bank's current account also, and of that sum Mr. Barnes appears to have received $10,781.40, or $3,218.60 was switched off before it reached Barnes. So that there were four notes endorsed by Pugsley and Barnes, presumably on account of the 15 miles section under the Barnes con-

tract. These four notes amounted to $52,336, and the lifts which were taken off them reached a sum of no less than $12,525.93; or nearly twenty-five per cent, which should have gone into the construction of that road, disappeared in transit after Mr. Pugsley had got the money from the bank. That is fully borne out by the evidence, and I defy the hon. member for Carleton (Mr. Carvell) or the hon. Minister of Public Works-if he would reconsider his decision and return to the House-to show that statement is not fully borne out by the evidence.

In addition we have upon that point the evidence of Mr. Barnes at page 646 and 647. My hon. friend the Minister of Public Works said last night that the commissioners would not put any questions about any of these matters, but his statement in that regard is, like all the others, directly contrary to the evidence and the fact. At page 646, Mr. Powell examined Mr. Barnes as follows:

On October 3, I see in your account you are charged with $10,225.01 in the Bank of Now Brunswiok and the same date there is a discount of $13,100, now the difference is about $3,300, what became of that difference? -A. I don't know.

And further:

On Otcober 20, $11,836, proceeds of Bank of New Brunswick also, on that date there is $11,800 odd dollars, got by discount, you were charged with $10,408.65, the difference would be about $1,400; do you know what became of that?-A. No.

Q. Who were on the note?-A. I can't say.

'I can't say,' though the records show that he and Mr. Pugsley were on it.

Q. On the 23rd December, $14,000 is got out of the Bank of New Brunswick, St. John, on the company account (1903); on that date you are charged with $10,781.40 only. To you know what became of the difference, $3,300? -A. No.

So, I think that any hon. gentleman who should attempt to reflect upon the commissioners for setting out these facts, in view of the evidence I have quoted, would be a very bold gentleman indeed. Now, it is but fair to say that the Minister of Public Works (Mr. Pugsley) himself was questioned when he was on the stand as to one of these notes. His evidence will be found on page 706.

Q. I find a note of about $13,000 or $14,000 discounted by you and Mr. Barnes in the Bank of New Brunswick or the British North America, out of which Mr. Barnes got $10,000. If this thing is so easy and properly kept, please tell me what you did with the balance between the $10,000 and the proceeds ? -A. Any balance to pay Mr. Barnes went to the secretary, M'r. Allen.

Q. Will you swear to that?-A. I am positive about that.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CEOCKET.

Q. Where is the record?-A. Mr. Allen had the record. I would not keep a record, why should I keep a record?

Though the Minister of Public Works states that he received that money, that he had it in his hands and that Mr. Barnes received only $10,000 of the proceeds, we find that he states that he sent the balance to the secretary of the company. I ask you if it is reasonable to suppose that any custodian of funds would send such an amount of money as that to anybody without being able to produce a letter either from himself to Mr. Allen or from Mr. Allen to himself, or a receipt or record of any kind bearing out his statement? He is asked for the record, and he says that Mr. Allen has the record. I read the evidence of Mr. Winslow, who succeeded Mr. Allen as secretary, showing that Mr. Allen had no books of account at all and that what data he had Mr. Winslow was familiar with, and there is not one entry in the account or one document that could be produced accounting for this difference between the amount Mr. Pugsley received on the discount of that note and the amount which Mr. Barnes received.

So, these are a few samples of the manner in which the money has disappeared. There are one or two others to which I wish to refer, and to quote a little evidence concerning them before I conclude my remarks. The name of Mr. Geo. McAvity is rather familiar in this chamber, as I think it is all over the country, and it will remain familiar, associated with that of the Minister of Public Works, so long as the government refuse to take any action to recover that $35,000 which he lifted out of the treasury here at Ottawa. Mr. McAvity became president of this company on July 1, 1904. There had been no president for about two years previous to that;. Mr. Ernest Hutchinson, who was the first president, got so disgusted with the manner in which things were going, that he refused to lend his name any longer to the company. But Mr. McAvity was called in as president in 1904. In the Legislature, the present Minister of Public Works (Mr. Pugsley) made a statement as to the great things that were to be expected by reason of Mr. McAvity having condescended to accept the trust and management of this great institution. At page 106 of the Debates of the Legislative Assembly the hon. gentleman is reported as saying:

As stated, the premier insisted upon a change of management. Not that Mr. Evans the then manager was not a competent man and thoroughly conversant with railway management, but the premier thought it would be wise to place affairs in the hands of an experienced and thoroughly competent business man, if such could be found, to take hold of the enterprise. Such a man was found in Mr. George McAvity, of the city

of St. John. I am accused by the opposition of being optimistic, of looking upon the rosy side of things, of having large ideas regarding the future of our province. I confess to that. X am glad that I am optimistic. I had far rather be an optimist than^ to stand like some members of the opposition with my eyes upon tiio ground, blocking tho wheels of progress. Of Mr. McAvity it need only be said that he is known throughout the length and breadth of this Dominion, and beyond its confines, as a progressive and successful business man, a member of a firm which has made an eminent success of its business and has built up one of the leading industries of the city of St. John.

I am inclined to think that members of this House will agree with the statement made by the minister that Mr. McAvity is known throughout the length and breadth of the Dominion, and that statement is truer to-day a great deal than it was when Mr. Pugsley made it on the floor of the New Brunswick Legislature in 1905.

But, bearing that statement in mind, let us see how the minister's optimism with respect to Mr. McAvity has been justified in the management of this road. At page 364 of the evidence, will be found Mr. McAvity's own statement as to the manner in which he executed this trust.

Q. When you became president in 1904 and continued at the head office, didn't you con-

Q. That $5,000 so far as this cash book appears from view?-A. That would be previous to my taking charge. _ .

Q. That is carried forward in pencil, on page 7 it is reduced to $47,250, then on page 9 it is carried forward in ink $47,827.70

can you give any explanation of this, how W. P. would get $5,000?-A. I did not make the entry, I have not the slightest idea.

Q. Do you know who W. P. was?-A. I have not the slightest idea.

Money of which he was the custodian, $5,000, had gone into the hands of W. P. and he had not the slightest idea as to how it got there.

Q. Do you know who W. P. was?-A. I have not the slightest idea. ,

Q. Do you know anybody connected with the business to whom W. P. would refer?-A. I have not the slightest idea. ...

Q. Do you know a person with the initials W. P. prominently connected with the business of the company?-A. I know persons with those initials.

Q. You know a man connected with the financial affairs?-A. I cannot say why they were put there.

That, Mr. Speaker, was the evidence of Mr. Geo. McAvity, whom the Hon. Wm. Pugsley recommended so highly on the floors of the New Brunswick legislature as a man who was going to straighten out the affairs of this road. At page 360:

trol the finances?-A. I took the presidency in 1904, they were starting a new set of books, Mr. Sharpe was auditing the books, and a new set of books had to be opened up.

Q. Where is this set of books?-A. They never were opened to my knowledge.

That is the way Mr. McAvity started in to execute this important trust.

Q. From the time you became president to the present time, you have not a single book kept in your office or under your supervision except the book you now bring and which was made up from other books? A. But the books that were held at Norton, at the head office. This book is made up from one received, I had paid me and from data in my office.

Q. Not from a book you had yourself?-A. I had no books to keep.

Page 368: .

Q. Do you know what books were opened?- A. Not of my personal knowledge.

This is the eminent business man who managed this road. Then at page 380

Q. I will call your attention here on page 5 * brought forward $52,250/ this was during vour regime?-A. That is since I took charge.

Q. I see in lead pencil ' less W. P. $5,000 - that is carried forward a total credit item on the 5th page. I see this in lead pencil ' less W. P. $5,000 ' ?-A. I never saw that before.

Although it subsequently appeared that Mr. McAvity had signed a cheque which was filled out in the handwriting of the Hon. Wm. Pugsley for that amount.

Q. As director, would you inquire into the business of the company?-A. No. In the position I was in I never gave any time or attention to it.

At page 361: 0

Q. There were no meetings of directors?-

A. None that I attended.

Page 363. He says that Mr. Pugsley substantially controlled the whole business. Now for these services, I may say, Mr. McAvity charged $5,000 a year, and the evidence shows that $2,380 had been paid him as interest on some coupons from the month of January to the month of March, on the sum of $216,000. This amount, $2,380, he did not know anything about, and could not account for it. In this investigation he was asked about it, and had no explanation. But a few days afterwards his counsel, the memDer for Car-leton, appeared with a statement showing that it had been charged up by Mr. McAvity as salary. When he was questioned, he had no knowledge and could not account for the money; but when he came back upon the stand, after a consultation with his counsel, he is questioned with respect to the money and said that he had put it in his pocket on account of his salary. Now, there is another section in the Act of 1001 which I read this morning, with reference to the conditions upon which this guarantee should be endorsed. There is a specific section in the Act providing that

the salary of that officer, and the amount of wages paid for his services

shall bo subject to the approval of the Lieutenant Governor in Council, who may fix or alter the amount from time to time as long as the said guarantee of the province shall remain outstanding.

Notwithstanding that provision there was nobody who knew the salaries of any of the officers of this company. They seemed to be taking money exactly as they needed it, and as they desired it, and to be taking it in very large sums. On that head I wish to quote from the evidence of the Minister of Public Works himself. Page 742:

Q. What salary did Mr. Allen get?-A. I don't remember.

The ex officio director of this company representing the government in the interest of the people of the province, with that provision in the Act I have referred tj, that the salary should be fixed by the Lieutenant Governor in Council, states in his evidence that he was not even aware what salary was paid to the secretary u, the company, or that he did not remember.

Q. Do you know what salary Mr. Trueman got?-A. I do not remember.

Q. Did tho directors get any remuneration? -A. They got some remuneration.

Q. You all got some?-A. I do not believe I got much. Take the accounts, and I think I am out of pocket, I think outside the New Brunswick Real Estate, Loan and Trust Company you will find I am out of pocket personally.

Q. Had you any arrangement as to what you would get?-A. No.

Q. You did get something as director or manager ?

Now, mark that question. The member for Carleton said there was no evidence that Mr. Pugsley was manager of this company. He did not dispute it on the ground that he was manager. He says:

A. I do not think so. It was proposed to give me_ something, I think Mr. Sharpe submitted it for consideration. There were certain accounts had to go before Mr Tweedie as premier, for payment, and he refused to allow anything for me.

Q. He was not generous?-A. He was extremely careful, he was heartbreaking at rimes.

Now that is the evidence of the Minister Hublic Works in regard to his knowledge of the salaries that were paid the officers of this company. He could not give the commission any information of any kind on that point, notwithstanding that under the terms of that Act he and the Provincial Secretary were appointed a board to see that those terms were carried out.

Now, in reference to this proposal of Mr. Sharpe, the Minister of Public Works told Mr. CROCKET.

us in his evidence that this employee of the company, and a temporary employee, had proposed that $5,000 should be paid to him, Mr. Pugsley, as managing director. I quoted last night the statement of Mr. Sharpe, of the 31st May, 1904, in which the $5,000 was written down as salary and fees of the managing director. Is it any wonder that the commission, in their report state that had it not been that the Minister of Public Works swore to it they would have believed that that $5,000, with reference to which the only entry was a lead pencil entry of W. P., was salary, and not a loan which he, the Minister of Public Works, stated that he made to the company.

I do not propose to discuss further the question of the 'W.P. $5,000.' I just ask the members of this House to consider this tact. There was a loan company, the New Brunswick Real Estate Loan and Trust Company, incorporated for the purpose, if we are to attach any importance to their name, of loaning money amongst other things. That company, as I showed last night from the evidence of the Minister of Public Works, had no books of account. The only entry in reference to the matter was ' W.P. $5,000,' which was a lead pencil entry in the bank book of Mr. George Mc-Avity. Neither in the books of the New Brunswick Coal and Railway Company, nor in the books of the New Brunswick Real Estate Loan and Trust Company was there any entry of the amount of $5,000 or of the amount of the loans that the Minister of Public Works alleged that he had made to the company in the name of the New Brunswick Real Estate Loan and Trust Company. I ask if there is any jury in this land which could be expected to believe for one moment the statement which the Minister of Public Works submitted to that commission? Is it any wonder that the commission declined to give that statement credence? The Minister of Public Works, on the stand, produced these cheques; not one of them was marked or made payable to the New Brunswick Railway and Coal Company. They all bore the names of other parties who, no doubt, had some connection with the old Central Railway. There was Elkins on one cheque, Evans on another cheque, Trueman on another cheque, and, I think, the Canada Permanent Loan Company on another. I ask the members of this House if a loan company making a loan to any other company would make it in the way in which the Minister of Public Works has alleged that he made the loans of this amount_ of money? The thing is, I have no hesitation in saying, absolutely incredible, and I showed by reference to the evidence of the Minister of Public Works this morning that he admitted that out of

the proceeds of these bonds he had recouped himself for loans that he had made.

1 think the explanation will be found there of how he received the amount of these alleged loans to this company.

Now, in reference to the lack of books and the confusion in the business of this company, I am going to put upon record further extracts from the evidence of Mr. Barnes. There was one question with regard to four drafts which he had charged the company with having paid, amounting to $1,026.50, $3,600, $2,620 and $1,127. He was asked, at page 642 of the evidence, what that money was for, and he replied:

I don't remember. It was the company's place to keep these cash accounts.

Q. You don't know, you can't give us any explanation of a single dollar of that $8,000 advance?-A. No.

Q. You don't know who got them?-A. No. Again:

Q. Have you any cheques or drafts that were given by you or accepted by you in connection with this transaction?-A. I did not beep track of that.

Q. Have you any cheques or drafts in connection with this matter between you and the company?-A. I do not think it. The business was wiped out and that was the end of it.

Q. Did you destroy your drafts?-A. I did as a general thing.

Q. Your cheques?-A. I destroyed them.

Q. Have you heard any tell of your books since?-A. No.

Q. Have you no idea where they are?-A. No.

And he actually told the commission that he had never seen a document in reference to the settlement that the New Brunswick Coal and Eailway Company made with him on account of his construction contract. I say, if these witnesses were examined before any jury in this country there is not the slightest doubt but that they would render a unanimous verdict, declaring their refusal to believe witnesses who gave such evidence as that, and yet that is the class of testimony that this commission have had to deal with. The Minister of Public Works, speaking in the House last night, asked: ' Why did the commission not call so and so? They did not want any information; they did not want to give us a chance.' It was very amusing to me, and I have no doubt, to the majority of the members of this House to hear the Minister of Public Works criticise and actually attack Mr. Hazen and Mr. Flemming as attorney general and provincial secretary of the province of New Brunswick because they were now ex-officio directors of this company and they were not able to make up the interest account in connection with moneys that were handled by the Minister of Public Works himself while he was an ex officio director of the company.

There is another matter which was referred to in this report and to which the Minister of Public Works has made reference himself. That is the buying off of Mr. Wheaton who tendered for the construction of this fifteen-mile section. There were two tenders, as appears by the report and by the evidence sent in for this work. One was that of Mr. James Barnes, amounting to $117,000, and the other was from Mr. Wheaton, amounting to $109,000, or $8,000 less. These two tenders were referred to a committee of the railway company, consisting of Mr. Pugsley, Mr. Skinner and others. The contract, although Mr. Wheaton was the lower tenderer and was an experienced contractor, as the commission state, notwithstanding what the Minister of Public Works stated last night, Mr. Wheaton was bought off pending the decision of the executive of which Mr. Pugsley was a member. He was paid $5,000 to withdraw his tender so that the contract went to Mr. Barnes, or the Barnes Construction Company, for $117,000 for the construction of this fifteen-mile section. That did not include the rails or the engineering expenses and another item or two which Mr. Shannon, in his report, says would have amounted to $70,000.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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L-C

Samuel Hughes

Liberal-Conservative

Mr. HUGHES.

Nor the ties.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

Oswald Smith Crocket

Conservative (1867-1942)

Mr. CROCKET.

It included the ties, I think, but not the rails. The contract went to Mr. Barnes, and, let me say in reference to Mr. Barnes, that he was also a member of the New Brunswick legislature, a member of the Grit machine of the province of New Brunswick, as every member of this directorate was a member of the Liberal machine in that province and he had associated with him in the Barnes Construction *Company the Hon. F. P. Thompson and Mr. W. T. Whitehead and other prominent figures in the Liberal party of the province. They were his chief associates. The commission do not find that Mr. Barnes' associates were advised of the buying off of the lowest tenderer, but if hon. gentlemen will look at the evidence they will find that there is abundant evidence in Mr. Barnes' own statement to justify the finding that these gentlemen were advised of the buying off of the tender of Mr. Wheaton. The upshot was that the contract went to Mr. Barnes for $117,000. What occurred? Last night the Minister of Public Works said that the reason that the contract had been awarded to Mr. Barnes was that he had been such a succes-ful contractor and that Mr. Wheaton had been a failure. The evidence is just to the contrary and the result shows that the minister's statement in regard to Mr. Barnes was absolutely unfounded, because, certainly, if he had never made a failure before, he made a failure of this contract for

he was compelled to throw up the contract in the spring of 1903 and, do you know, that the company actually took that contract off his hands and entered into an arrangement with him for the construction of the road upon a percentage basis agreeing to give him the actual cost of construction plus 15 per cent and that is a way a lot of the grafting was done in connection with this business. I have no hesitation in expressing it as my opinion that the importation of Mr. Barnes into this and the awarding of the contract to Mr. Barnes under these circumstances was with that particular end in view. The Minister of Public Works has spoken about the cost of this fifteen mile section and the unfairness of the commission in allowing only $316,000. Why, Mr. Speaker, that $316,000 is $25,000 more than the Minister of Public Works himself figures in the statement which is on the files. Although the commission express the opinion that this was entirely too much to allow for the construction of that line, they do nevertheless allow the whole amount of $316,000. Mr. Shannon in his report points out that if the New Brunswick Coal and Railway Company had done its duty and held Mr. Barnes to his contract the road could have been built for less than $200,000. Mr. Barnes agreed to build his end of it for $117,000 and Mr. Shannon shows that the rails and the engineer's expenses and another item or two would not have amounted to more than $80,000 extra. Furthermore, Mr. Wetmore the provincial engineer was instructed by Provincial Secretary Tweedie to visit the locality and make an examination of the work, and a letter from Mr. Tweedie is on file in which he expresses the greatest dissatisfaction with the manner in which things have been goiilg on. I think it is in reference to this, that the commission used the expression that he had called into play a force which he could not control, and the force which he could not control was the force of the Minister of Public Works. In August, 1903, Mr. Wetmore made a complete report of the value of the work up to that time, and he valued it for the branches and all at $195,000, and that report was sent to Mr. Tweedie. Mr. Tweedie wired Mr. Wetmore for an estimate of what it would cost to complete the road and Mr. Wetmore made another report saying that $31,000 would have completed it. Therefore, on the report of the engineer of the government this road was worth only $226,000. Before the commission evidence was offered as to the cost of similar roads in New Brunswick, and while they have allowed the whole $316,000 it is clear from a perusal of the report that they allowed many thousands of dollars more than was honestly spent in the construction of the railway.

Before I conclude, Mr. Speaker, I feel Mr. CROCKET.

that I cannot, as a member of the New Brunswick Bar, allow to pass unchallenged the bitter, vindictive and malicious attack which the Minister of Public Works saw fit to make upon an honoured member of the Supreme Court Bench of New Brunswick. I say this, and no one knows it better than the Minister of Public Works, that we have never had upon the Supreme Court Bench of our province-and we have had many eminent judges there-a judge who occupied a higher place in the esteem of the people of the province than does the Hon. Mr. Justice Landry. Not only is Mr. Justice Landry respected and honoured by the people of his own race-and let me say that he is recognized as the most distinguished man the Acadian race has given to the province of New Brunswick-not only is he honoured by the people of his own race and his own creed, But he is honoured by the whole citizenship of New Brunswick irrespective of race and irrespective of creed. And, Sir, it will require far more than the denunciation of the Minister of Public Works to detract from the high reputation which Mr. Justice Landry enjoys, not only in New Brunswick, but throughout this whole Dominion. If there is one quality more than another for which Mr. Justice Landry is distinguished it is his absolute fairness, honesty, and integrity. I repeat that no one knows that better than the Minister of Public Works. I was very much surprised, as a member of this House and as a member of the Bar of New Brunswick, that a gentleman occupying the high position of a minister of the Crown, should make such an unwarranted and malicious attack upon that distinguished citizen of our province. As a member of this parliament and as a member of the Bar, I resent in the strongest possible terms the conduct of the Minister of Public Works in seeking to besmirch the good name of that honoured man. I challenge the Minister of Public Works to point to one single act with which Mr. Justice Landry can be connected either in his public career or his judicial career which does him other than the greatest credit. Mr. Justice Landry was a member of the provincial government of New Brunswick in the days when we had no New Brunswick Coal & Railway frauds. In the regime of that government of which Mr. Justice Landry was a member there was never a single scandal of any discription that could be charged against the administration, and in that government Mr. Justice Landry was the minister of the spending department. I have the feeling that no one will regret more than the Minister of Public Works himself the attack which he was so unwise and so indiscreet as to make in this House last evening upon that honourable and distinguished member of the New

Brunswick judiciary. I do not think that Mr. Justice Landry requires any defence from me. In the documents that I have read to-day and the citations that I have made from the evidence is to be found a vindication of Mr. Justice Landry if vindication were needed. I challenge any member of this House to show wherein the evidence given before that commission does not bear out to the fullest extent every finding made. Not only that, Mr. Speaker, but if this commission has erred at all it has erred on the side of leniency.

I have already pointed - out three or four instances in which the name of the Minister of Public Works should have been set forth in the report and where it was omitted, I suppose, out of consideration for the high office he occupies. But if, as the Minister of Public Works said, the commission was actuated only by a reckless desire to destroy him, is it likely that they would have refrained from mentioning his name in reference to some of these transactions where his name is mentioned in the most discreditable manner in the evidence which wras adduced before the commission.

Now, Mr. Speaker, as to the character of this commission, perhaps some members of this House who are not familiar with the public men and with the judges of New Brunswick may take some stock in the statements of the Minister of Public Works, but I can assure them that these the commission, to prove this. The editor pie who live in the maritime provinces. I could quote from an editorial of the St. John ' Globe ' of April 12 last, which refers to these violent attacks made upon the commission to prove this. The editor of the ' Globe, ' is one of the most consistent Liberals in the Dominion, who is one of the most honourable Liberals in the Dominion, and who though possibly he may not be, an intense admirer of the Minister of Public Works, has certainly up to this time enjoyed a good standing in the Liberal party. I could point to this editorial in the St. John 'Globe' to show that it resented these attacks and stated that the commissioners are men of the highest character, as everybody in New Brunswick knows. And, Sir, it will require more than such an attack as was made upon that commission last night to disturb the effect of the findings in that report. I apologize for detaining the House at such great length, but in view of the position which the Minister of Public Works took with regard to the evidence I thought it was necessary. He started out by stating that these findings were not borne out by the evidence and he expressed regret in his own speech and in some of the interruptions during the speech of the hon.

member for West Elgin that the matter was to be confined to a discussion of the report, because what he wanted was the evidence. The Minister of Public Works acknowledged that he had two volumes of the evidence of the witnesses, and there are only two volumes. Yet did he allude to the evidence from the beginning to the end of his five hours' speech yesterday? Not to one syllable, and why? Because he knew that the evidence condemned him more strongly than the report. He made a great talk in the newspapers about the necessity of having the evidence; he admitted yesterday that he had it; but he declined to use it, for the reason I have stated. Now the House has the evidence, and I think I have established by quotations from it that there was not one shadow of justification for the position the Minister of Public Works took in his speech yesterday.

A word or two in reference to a statement that was made by the hon. member for Carleton and also by the Minister of Public Works while the hon. member for West Elgin was speaking yesterday; that was, that they had not had an opportunity of giving evidence, and that the commission had attempted to cut them off. Does my hon. friend from Carleton say that he did not appear as counsel for the New Brunswick Coal and Railway Company? Does he say that Mr M. G. Teed did not appear as counsel with him? Does he say that Mr. A. P. Barnhill did not also appear as counsel for the ex-commissioners, Messrs. McAvity and King? I ask the hon. member for Carleton to contrast the conduct of this commission with the conduct of the Insurance Commission which was appointed by this government some years ago, the chief purpose of which I have always thought was to get a crack at the member for North Toronto (Mr. Foster). An attempt was made to shatter the reputation of the hon. member for North Toronto by the operation of that Insurance Commission. There were charges made of every description. Mr. Foster appeared before that commission, and he was refused again and again the privilege of putting questions through the mouth of his own counsel. And yet a party which issued instructions for the conduct of a commission on such lines as that has the temerity to criticise the conduct of the commission appointed by the New Brunswick government under which the fullest possible opportunity was offered to every counsel who desired to appear on behalf of anybody who had any conceivable interest in the inquiry. I cannot give a better idea of the fairness of Mr. Justice Landry than to quote from pages 61 and 62 of the report of the evidence:

St. John, July 8, 1908.

Commissioners met, pursuant to notice, in the Admiralty Court Room, at 10 a.m., to hear evidence.

The Chairman. This is, virtually the first session of the commission for the particular purpose of taking evidence. It is true, that we met at Fredericton and sat there a short time, but, employed most of the time on the examination of legislation concerning the railway, and in examining certain documents. We called some witnesses, but, inasmuch as this is a public investigation, and as everybody who is interested should have every right to be present, personally, or by counsel, we would like it understood that what we did at Fredericton in the matter of taking evidence is open to the inspection of anybody. The evidence is typewritten, and the witness may be recalled for the purpose of cross-examination or for other purposes. [DOT]

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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Mr. M. G.@

Teed, K.C., who was present, said: A few moments ago I received a telegram from Mr. F. B. Carvell, at Ottawa, stating that he had been retained to appear for the New Brunswick Coal and Railway Company in this investigation, and he wished me to appear to-day and ask for an adjournment. We all know he had his parliamentary duties to attend to, but I am not otherwise aware of the reasons he has for assisting the adjournment. But I should think it would be very important that the company should be represented. I hope your honour may make such an adjournment and allow the hearing to go over until after prorogation of parliament, which, I understand, will be the end of next week.

Mr. Powell. I do not see how this application can bo complied with. It cannot be for the reason of the absence of counsel. There are numerous counsel in the city of St. John who could be engaged. I certainly would oppose a postponement. It does not look like a bona fide application. If there was any real necessity for an adjournment I would consent.

The Chairman. I think we can hardly accede to this request just now, at any rate. I appreciate the interest which this company would have in the proceedings, and perhaps the necessity of their being present-certainly we would be assisted if they were present, but this invstigation is likely to take some little time, and I think it is impossble for us to commence by adjournments to accommodate everybody. If we so commenced we would not know where we would land. Mr. Carvell is employed at Ottawa, and he cannot leave until after adjournment of parliament, the date of which is doubtful. If we were to commence by acceding to all the requests that were made for adjourning, I do not know when we would be liable to close. I think we would meet so as to have the evidence transcribed, and it would be open to these people to have witnesses recalled at any time for the purpose of examination or anything else.

Mr. Teed. Inasmuch as this is the first application on behalf of the New Brunswick Coal and Railway Company-while I can understand the force of much Your Honour says -I think in this case they might consider ? prejudiced if not represented.

The Chairman. There is a great deal in what has been said by Mr. Powell that counsel could be obtained. I have had a similar ap-Mr. CROCKET.

plication from the Minister of Public Works, asking an adjournment that he might be present, himself. That letter was written some time ago, and I replied to it, and in his answer he does not insist on an adjournment. If counsel could state a definite time at which he could be present, we would endeavour to accede to his wishes, but, we could hardly adjourn unless there was some fixed date at which we could be assured that the meetings would be held.

After that Judge Landry wrote to the Minister of Public Works as to the importance of his being examined as a witness, and request after request was made by the Minister of Public Works for an adjournment, and his convenience was consulted absolutely. At that very sitting of the commission Mr. Teed appeared as counsel for the company. At the next sitting, in the following week, the hon. member for Carleton appeared as counsel for the company and Mr. A. P. Barnhill appeared as counsel for the ex-commissioners, and on the 20th of August, three months before the Minister of Public Works was examined, he himself appeared as counsel and I happened to be at a session of the commission in which he was conducting an examination of witnesses. In view of this record, it seems to me to have been very bold on the part of the Minister of Public Works to hazard any criticism of the commission in reference to their treatment of the parties and' the privileges of counsel. But could any sane or sensible man be expected to take any stock whatever in the argument that was put up by the Minister of Public Works last night, that he, the managing director of this railway company, who had the responsibility of the company upon him more than any other man, who was familiar with its transactions from beginning to end, who negotiated practically every loan with the banks-that he, having attended the sessions of this commission, having followed,

I assume, as every other citizen did, in the press of New Brunswick, the evidence that was given, would go on the stand in the month of December and not be able to clear up those matters with reference to which there was any doubt. Would anybody believe for one moment that a gentleman of the ability of the Minister of Public Works and of his ingenuity would come forward to give evidence and then simply, because he was not asked a certain question, fail to give any information which would tend to clear up the tangled affairs of the company. But, as a matter of fact, he was asked, as I pointed out by the evidence, what became of the proceeds of the notes which were discounted on the guarantee of these bonds and which he handled, and his evidence speaks for itself. He had no record, no receipts, everything had been handed over to two men, both of whom had

gone to their majority, and he could give the commission no information or enlighten ment. Then he criticised the Attorney General of New Brunswick and the provincial secretary because forsooth they have not been able to supply the evidence which the Minister of Public Works failed to give us regarding his own manipulation of the funds of the company. In view of this evidence, the statement of the Minister of Public Works made yesterday cannot have much weight in the minds of impartial men.

Mr. O'. TURGEON (Gloucester). I have no intention, Mr. Speaker, of following the hon. gentleman who has just addressed the House through the many tortuous windings of the lengthy speech he has made. -When my hon. friend from West Elgin (Mr. (brothers) brought in a resolution yesterday to the effect that the Minister of Public Works (Mr. Pugsley) should be asked to resign or bo dismissed, he appealed to the very tender regard which the English people have always had for the character of their public men, and he hoped that the high record they had shown in that respect would not be departed from in this instance in Canadian public life. With that sentiment, I am in perfect harmony with my hon. friend and so is every true Canadian who has the honour at heart of the men to whose guidance are entrusted the destinies of this great nation. But because we are jealous of the character of our public men is no reason why we should fall into the opposite extreme and create bad impressions, not only among our own people, but in countries outside of Canada, regarding the conditions of Canadian public life. The time has come, it seems to me, when we ought to cry halt in our endeavour to achieve political success by suspecting scandals where they do not exist. Changes of government have taken place before this session. We have had recently a change of government in New Brunswick. A few years ago we had a change of government in Ontario, when the party which had held the reins of power for many years was compelled to give place to its opponent. Inquiries of all kinds have been made, commissions appointed and changes have also taken place in other provinces, but are we to expect that whenever there is a change of government, its successors must appoint commissions to find out evils in the administrations of its predecessors, and have those reports brought before the federal Parliament, as in this case, which aire foreign to our jurisdiction. My hon. friend from Elgin, to add to the solemnity of his language, made several times the declaration that he was standing for the report of a judicial commission. Well, for my part, every time I took up the report of

this judicial commission, I found it impossible, according to my own conscience and my own intelligence to reconcile my judgment with every assertion made in that report.

Fearing, perhaps, that if the name of Judge Landry did not appear at the head of that commission, there would be less respect for its findings, my hon. friend from York county made a reference to the standing of Judge Landry before the bar and the people of New Brunswick and the people of the Acadian race whose interests he has advocated so ably on so many different occasions. Well, no man in this House could have a greater respect for Judge Landry than the member for Gloucester who is now addressing you. One of my proudest recollections is to have had the good fortune, in the starting years of my public life, to have had the honour of collaborating with him in his endeavour to bring the Acadian race, by means of education to the level of the other races.

Meanwhile my respect for Judge Landry, the respect in which he is held in the province of New Brunswick and which he specially enjoys as a judge of the Supreme Court of that province, does not grant him the gift of infallibility, and his judgment with that of the other commissioners, of whom my hon. friend has spoken so highly is not necessarily to be accepted without question. When I study this report of the commission, I find myself at times unable to find'in it any evidences of the judicial attitude. I am not a lawyer or, as the saying is, the son of a lawyer-I am only the father of a lawyer;-but I appeal to every man of legal training and legal ability in this House to say if he can find in this report the judicial tone which the hon. member for west Elgin (Mr. Crothers) has endeavoured to make the House believe it had and because of which, apparently, he sought to invest it with infallibility. When I look at this document, I fail to recognize the wisdom, the lucid explanation of legal matters characteristic of my old friend Judge Landry and shown by him on many a previous occasion. I fail to see the evidences of careful thought in this Teport. I wholly fail to appreciate the conclusions resting upon assumptions which, at times, can hardly be said to be sound. I find in some of the conclusions of this report rather the characteristics of a political harangue by a stump speaker, regardless of the responsibility of his utterances. There are only a couple of points to which I wish to call attention, and which particularly struck me from the first. These points I cannot explain to myself; I believe they are enough to cast suspicion on the judicial findings of this report based upon evidence which is not at our command to-day, we are here called upon to pass judgment upon the

political life of one of the biggest men, to use the expression of my hon. friend from York (Mr. Crocket), whom the province of New Brunswick has ever produced. We are called upon to eliminate from public life a man who has been at the head of affairs in his own province, and who in this parliament has taken a foremost place and since he has been amongst us has commanded the sympathy and admiration of every hon. member. And why should we be called upon to discuss this report? The legislature to which it belongs has not seen fit to discuss it. This report was placed upon the table of the House of Assembly of the province of New Brunswick, and for thirty days thereafter that House was in session, and no action was taken, or attempted to be taken, upon the report. What is the reason that the present leader -the temporary leader I may say-of that House did not see fit to call the attention of the legislature to this report and ask the legislature to review it? But we, the great parliament of Canada, are called upon to discuss a question beyond our sphere and foreign to our duty while the legislature of New Brunswick for whose benefit this report is made, has left the discussion of it over for another year at least.

One of the first points to which I wish to call the attention of this parliament is to be found in the second paragraph of the conclusion of the report. It may be said again that I am appealing to that figure which is called a typographical error. In saying that $430,000 and $500,000 are misprints here for $43,000 and $50,000. But leave out the possibility of a typographical error, and I ask you again, if these commissioners were really alive to the responsibilities of their actions and findings, could it be possible for such an error to be allowed to pass?

On the face of it the motive of the promoters as stated was to develop the coal mines of Queens county. Responsible and respectable men from various parts of the province were obtained to lend their names as directors; and from the fact that $430,000 of the total $500,000 authorized capital was to be distributed as founders' shares, we conclude that the interested parties had visions of ultimate large profits, with absolute certainty of no personal loss.

If this was a typographical error, if the commissioners had in view merely the sum of $43,000, then there was no reason for 'visions of ultimate large profits with absolute certainty of no personal loss,' and therefore these words should not have been used in this report. Another point to which I wish to call attention is the great difference in the conditions of railway building as they exist now and existed twenty or thirty years ago. It strikes me that if I were called upon to require an estimate for the construction of a railroad Mr. TURGEON.

I would apply to engineers with experience in railroad construction; I would not be simply guided by the estimates which may have been given by engineers twenty or thirty years before the date of the construction of this 15-mile section, and conclude that because a few miles of railroad may have been built in the early days in New Brunswick for $10,000 a mile or less, to-day you can build in other sections of the province a railway for a somewhat similar amount or double the amount. We must remember that conditions of railway building have changed completely, in the cost of labour, in the cost of materials, and in every other way. There can be no possible comparison between the cost of railway building in the two periods. Thirty years ago you could get labour for the asking. I knew men in those days working on railroads in my own county for 75 and 80 cents a day, and they were paid out of the stores of the contractors whatever price the contractors chose to ask for their goods. In those days railway ties could be bought for a few cents apiece. I have the testimony of my hon. friend from Kent county who, in his early years, sold railway ties for 15, 13 and 12 cents apiece. Now I ask vou, Mr. Speaker, how much has the present Minister of Public Works or his predecessor had to pay for railway ties? Why, Sir, the prosperity of Canada has advanced the value of every possible commodity. I am safe in saying that in Kent county to-day it costs 200 per cent more to construct a railway than it did in the former period. It is also to be remembered that modern railways are much more solidly built, they are built for the purpose of transporting coal and heavy freight, whereas in former days they were built for the transportation of a few boxes of fish and a few passengers. And because this railroad has cost 100 per cent more than our friends think it should have cost, they say there has been a misappropriation of $242,000 upon that section. I say, Mr. Speaker, that such a conclusion lends itself to doubt and suspicion on the part of every honest man who wishes to come to a correct conclusion. These two points are sufficient, I think, to answer the contentions of our hon. friend opposite. It is not my intention to follow in detail the long speech of the hon. member for York, N.B. (Mr. Crocket). It was not my purpose in rising to defend the hon. the Minister of Public Works. That hon. gentleman has proved on many occasions that he is quite able to defend himself; he has proved it twice already during the present session; he proved abundantly last night that he needs no one to come to his defence when he is attacked, that he is w'ell able to stand against the calumnies of his political op-

ponents. I may say that since this debate was begun yesterday I have had some conversation with hon. members, both of this House and of the Senate, and they are by no means in sympathy with the motion of censure. I am confident that this motion does not meet with the approval of every Conservative in the Dominion of Canada, nor even of every Conservative member in this House. I am sure that the Minister of Public Works yesterday satisfied every member in this House who desires to form an impartial judgment, that as ex-officio director of this company he knew everything that wras being done; and if at one time when he had to take over this road it was found that the company had got into financial difficulties, I say it is no new thing in our province of New Brunswick. We have found in the past that when our public men were endeavouring to develop the great resources of our country they did not meet with the encouragement they were entitled to. Today we are doing everything possible to develop the west, knowing that its development will mean the progress of the east. I think that when our public men enter into schemes for the development of our province of New Brunswick, and of the Dominion of Canada, they are deserving of more encouragement than they receive That has been a trouble that has existed in the past. I hope that after all, when this matter has been thoroughly sifted, when the judgment of this parliament and of the country has been pronounced, it will be that these men who were acting in the interest of the province are deserving of more encouragement than they had received. Hon. gentlemen opposite contend that $20,000 a mile should have been sufficient to build that railway. What did we find in the legislature of New Brunswick when that very report was laid upon the table of the legislature of the local legislature?

Only two weeks ago, and since that report has been placed upon the table of the House, Premier Hazen, the leader of the government, has undertaken to give the guarantee of the province of New Brunswick for a railway with the same objects as this one had, that is for the development of an iron mine, for a railway which traverses the county ofGloucester from Nipisiquit river to Bathurst, and which will assist in the development of the iron ore deposits there. He does not estimate the cost of the railway construction in New Brunswick at $5,000 or $10,000 but he gives a guarantee of $15,000 a mile and this when heknows' that the very same company

are also applying to this government for a subsidy of $6,400 a mile. The fact that he is willing to give the guarantee of

his province to the extent of $15,000 a mile is an admission that railway construction in New Brunswick cannot be carried on for $8,000 or $11,000 or even for $20,000 a mile. Therefore, his action, patriotic as it may be, in giving this guarantee, which I approve of, and I have advised his supporters to second his efforts in this matter, is a contradiction of the finding of this commission as to the cost of railway construction in New Brunswick. In conclusion, I wish again to say that, whatever the vote upon the opposition side of the House may be, we, on this side of the House, feel convinced of the moral innocence of my hon. friend the Minister of Public Works. He has devoted a lifetime to the public affairs of the province of New Brunswick and in every sphere into which his activities have entered he has won a high place in _ the affection and esteem of patriotic Canadians in all parts of the Dominion who have observed his public conduct. To-day every Liberal in the province of New Brunswick, every unbiased man, to whatever party he may belong, feels, as my right hon. friend the Prime Minister said a few days ago that he felt, proud of the Minister of Public Works. Every friend of ours in the province of New Brunswick is satisfied that the Minister of Public Works has faithfully discharged the trust which was reposed in him when he was called to the federal arena to give his important services, not only to the great Liberal party to which he belongs, but to the Dominion at large. I shall consider it my duty to vote against the resolution and I feel that in doing so I shall have the confidence and support -of all of my constituents in the county of Gloucester. I feel also that I shall have the sympathy and support of the great Acadian race in the province of New Brunswick, of which the hon. member for York has spoken, which has shown its appreciation of the development of the resources of this country under a Liberal government for the last thirteen years and which has no ground to alter its views with regard to any public man because of anything contained in the report of this

commission.

House divided on amendment

thers).

YEAS:

Messieurs

Armstrong, Lennox,

Barker, Lewis,

Barnard, Lortie,

Barr, Macdonell,

Blain, Magrath,

Borden (Halifax), Marshall,

Boyce, Meighen,

Bradbury, Northrup,

Broder, Owen,

Burrell, Paquet,

Campbell, Perley,

Clare, Porter,

Cowan, Reid (Grenville),

Crosby, Roche,

Crocket, Russell,

Crothers, Schaffner,

Currie (Simeoe), Sexsmith,

Daniel, Sharpe (Lisgar),

Doherty, Sharpe (Ontario),

Edwards, Smyth,

Elson, Sproule,

Foster, Staples,

Fraser, Taylor (Leeds),

Goodeve, Taylor (New West-

Gordon (Nipissing), minster),

Haggart (Lanark), Thoburn,

Henderson, Thornton,

Herron, Wallace,

Hughes, White (Renfrew),

Jameson, Wilson (Lennox and

Kidd, Addington),

Lalor, Worthington.-63.

Lancaster,

NAYS:

Messieurs

Aylesworth, McIntyre

Beauparlant, (Strathcona),

Black, McKenzie,

Brodeur, McLean (Huron),

Brown, McLean (Sunbury),

Calvert, McMillan,

Carrier, Major, Marcile (Bagot),

Carvell,

Cash, Martin (Regina),

Chew, Martin (Wellington),

Chisholm (Inverness), Mayrand,

Clark (Red Deer), Meigs,

Clarke (Essex), Michaud,

Congdon, Miller,

Conmee, Molloy,

Dubeau, Nesbitt,

Dugas, Neely,

Ethier, Oliver,

Fielding, Papineau,

Fortier, Pardee,

Gauvreau, Paterson,

German, Pickup,

Girard, Proulx,

Gladu, Prowse,

Graham, Rankin,

Guthrie, Reid (Restigouche),

Harris, Richards,

Harty, Ross,

Hodgins, Rutan,

Kyte, Savoie,

Lanctot (Laprairie- Schell,

Napierville), Seguin,

Laurier (Sir Wilfrid), Sinclair,

Lavergne, Smith (Middlesex),

Law, Smith (Nanaimo),

LeBlane, Smith (Stormont),

Lemieux, Stratton,

Loggie, Sutherland,

Low, Talbot,

Macdonald, Templeman,

MacNutt, Turcotte (Nicolet),

McAlister, Turgeon,

McCoig, Turriff,

MeColl, Verville,

McCraney, Warburton,

McIntyre (Perth), White (Victoria, Alta.)-90.

PAIRS:

Messieurs

Ministerial.

Currie

(Prince Edward), Borden Sir Fred'k), Bureau,

McGiverin,

Emmerson,

Fisher,

Allen,

Iiickerdike,

Beland,

Chisholm

(Antigonish),

Fowke,

Tolmie,

Gordon (Kent), Gervais,

Todd, .

Sifton,

Robb,

Murphy,

Martin (Montreal, Mary's),

Devlin,

Roy (Montmagny), Seeley,

Lovell.

Opposition.

Maclean (York, S.),

Osier,

Monk,

McCarthy,

Wright,

Lake,

Ames,

Bristol,

Forget,

Chisholm (Huron),

Beattie,

Stanfield,

Stewart,

Price,

Maddin,

Middlebro,

McCall,

Haggart (Winnipeg), St. Nantel,

Blondin,

Arthurs,

Rhodes,

Donnelly.

Amendment (Mr. Crothers) negatived.

Motion (Mr. Fielding) agreed to, and the House went into Committee of Supply.

Immigration-salaries of agents and employees in Canada, Great Britain, and foreign countries, $200,000.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
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CON

George Eulas Foster

Conservative (1867-1942)

Mr. FOSTER.

Will the Minister of the Interior give us an explanation of this decrease of $100,000 as compared with the previous year? I notice that the Minister of the Interior is not ready. I am inclined to think the Minister of Finance will not make much progress between now and six o'clock and may be we might go now and come back five minutes earlier and by that time we may have the Minister of Public Works with us.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
Permalink
LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

I did not know that my hon. friend (Mr. Foster) was so anxious to have the Minister of Public Works here.

Topic:   SUPPLY-HON. WM. PUGSLEY AND THE REPORT OF THE CENTRAL RAILWAY COMMISSION.
Subtopic:   MEMORANDUM FOR BONDS SIGNED AND DELIVERED LATER.
Permalink

May 6, 1909