Mr. A. H. CLARKE.
villains if they have done such a thing.
I have a list of the directors of 1879 and a list of the directors who, in 1880, declared profits without giving the policy-holders the interest on invested capital, but first taking the interest on capital and then computing the profits for the policy-holders. The first is Mr. F. Wolferstan Thomas, of Montreal. Then there is Canon Innes, of London, D. Mclnnes, Hamilton, George Hague, Montreal, F. W. Gates, Hamilton, Mr. Justice Burton - who was at the time a judge of the Court of Appeal, and afterwards became Chief Justice of the province of Ontario,-Col. Gzowski, Toronto; N. Merritt, Niagara; Thomas W. Ritchie, Montreal; John Stuart, Dennie Moore, and Wm. Hendrie, of Hamilton;- George A. Kirkpatrick, M.'P., of Kingston,-my hon. friend (Mr. Henderson) lauded him as a most exemplary character, one who would do nothing wrong; yet he is one of the men who perpetrated this great fraud upon the policy-holders according to my hon. friend himself-A. G. Ramsay-whom also my hon. friend lauded and who -also was one of those who took part in this transaction; James A. Harding, St. John, N. B.; J. Osborne, Hamilton, then another Lieutenant Governor, Sir Alexander Campbell-he was another of these villains,-Mr. A. Allan of Montreal, one of the most prominent business men of Canada, and Mr. Thomas Swin-yard, of Hamilton. These were the men who were responsible. This was not done by Mr. Cox, who is now being made the target of attack; he had nothing to do with the directorate of the company in those days; he did not institute the practice now complained of, but followed the practice as he found it and which every person believed to be correct practice. It seems to -me that when hon. gentlemen will rise here and say that these men, not believing they were doing right, did exactly the contrary of what they led parliament to believe they were going to do, they are putting a stamp upon the reputation of prominent men in this country which is not deserved. When we have a Chief Justice of the ability and standing of Chief Justice Burton, who was connected with the company up to the time of his death, this is a pretty good guarantee to the policy-holders that the directors acted in what they thought the best interest of the policy-holders and in accordance with the claims of justice. My hon. friend from Montmagny (Mr. Cyrias Roy) asked a very proper question, and that was, as to the attitude of the policy-holders' directors. For, in 1899, by Act of this parliament, the directorate was changed to some extent, so that six of the directors were appointed by the policy-holders along with nine to represent the shareholders. It is
true that, under the Act, the policy-holders' directors were not to vote on the question of distribution of profits. The company would cease to be a joint stock company if that were done. Parliament, at that time, thought that this was good representation of the policy-holders on the board, and did not see fit to say that the policy-holders' directors should have a right to vote on a matter which affects the distribution of profits. But these men have -other duties to perform. The policy-holders have had their representation on the board ever since 1900. Do we hear any complaint from them? They are the people the policy-holders sent there to represent their interests, and they have acquiesced in every respect, not only in the division of profits made ever since that time, but also, I am informed, in the application to this parliament to have this matter set right in order to prevent costly and, perhaps, never-ending litigation and to preserve the standing of the company. Are these competent men? Who ' are the men appointed to represent the policyholders? I believe the Act was passed in 1899, and I have here a list -of the policyholders' directors in 1900. The first was Mr. Alexander Bruce, who has been referred to in this debate. Besides there were Hon. Donald Maclnnes, Sir Georce W. Burton, William Gibson, M. P., Very Rev. G. M. Innes, of London, and J. W. Plavelle. These men, one would think, ought to be able to protect those whom they represented. They were men of large business experience, large professional experience, and among them was a member of ttie clergy, who, we might expect, if any fraud was intended, would be able to protect those who elected him to the board. This list is changed somewhat. Mr. Maclnnes died, and his place was filled by the election of Mr. Charles Chaput, of Montreal, who, I understand, is a very prominent and astute business man of that city. These men and their successors have been meeting year after year on the board of directors, they have known exactly what is going on, they are interested in the prosperity and success of this company, their interest and duty was to represent faithfully those who elected them. And I submit that the very strongest evidence of the good faith and beneficent character of the legislation being asked for is that these men, appointed for the purpose of representing the policyholders, have approved the manner of distributing the profits which has been followed, and, at a meeting in which Mr. Chaput took part, decided that it was in the interests of all parties that this matter should be set right and no further difficulty raised in connection with it.
Now, what are the tactics against this legislation? A writ was issued. What
would be the effect of that writ if granted? It is brought against the Canada Life Assurance Company, not against the shareholders who have received the profits which some say have been unfairly diverted to them. The action is brought against the company alone. If judgment were given against the company, out of whom will the payment come? Not the men who are dead, the men whose stock has been disposed of, but out of the very fund which the policyholders want for the distribution of profits. Take away by this action the profits which the policy-holders are entitled to, and the policy-holders cannot get those profits. I submit that the policy-holders to-day are entitled to the very moneys which this action is brought to take away from them. Mr. Laidlaw has been discussing this matter for the last three or four years-it is no new matter for him.
My hon. friend from Halton read a paragraph from his affidavit from which he drew the inference that he had been for a long time ignorant of what the profits were. I have his own letter written before that time when he was discussing this question with the president of the company. Go back to the year 1902, and you will find on the files in the records of the government a discussion of this very matter by Mr. Bruce. My hon. friend gives him a good reputation as a man who would do no wrong, and who did not intend to do wrong; yet he endeavoured to say that, although he allowed Mr. McCarthy, the solicitor of the company, to appear before the Banking and Commerce Committee and show what was the meaning of those men, Mr. Bruce being the man who framed the Bill of 1879, who sat there in the Banking and Commerce Committee, ready to corroborate it, yet my hon. friend says although Mr. Bruce was there he would not venture to get up and corroborate it. Is that complimentary to Mr. Bruce, the man who was promoting this Bill? Yet he says he has allowed all this hypocrisy to go on, first of all knowing what the intention of the Act was, the next year taking part in an, act which was one of treachery to the policy-holders. Yet he says that man sat still in the committee because he knew he could not get up and say that any mistake had been made, or that the intention was other than it was claimed to be. Yet I find that Mr. Bruce wrote a letter in the year 1902, when this matter was being agitated, and he explained it in precisely the same way it is being explained here. In 1902 he wrote a letter to the actuary. It is very long, and if any hon. gentleman cares to read it I will send it over to him. What he says in substance is that the reason for the Act of 1879 was this, that up to that time the directors
were not authorized to pay the participating policy-holders any part of the profits except those arising from participating policies. Now, the directors, notwithstanding that, had been going on for years and paying them, not only profits from participating policies, but profits from nonparticipating policies. That was open to objection, because the Act did not authorize it. Therefore, the intention in coming here, as Mr. Bruce points out, and what is apparent from reading the Act of 1879 itself, is to authorize the directors to pay profits to the participating policy-holders from both branches of the business, that is to say from the participating business and also from the non-participating business, and so anxious was he to show that, that he uses the very words that are now held to mean something further than was intended. What he says is that the entire assurance business paid profits, meaning, as he points out in the paragraph, all the business, that is to say, profits from the participating and also profits from the non-participating business; he makes it clear, and points out what the recital in the Act of 1879 shows plainly, that the profits which were to be divided thereafter were the profits which had theretofore been divided. The proportion up to that time time did not include interest on the investment of the capital stock, and it was never pretended at that time that any profits were to be divided except those that had theretofore been divided. Mr. Robertson, of Hamilton, in introducing the Bill, merely said that it was intended to alter the proportion in which the profits were to be divided. The proportion up to that time had been 75 to 25, after that time they were to be 90 to 10, and these profits which were set apart for division previously, have been thus divided ever since that time. Now it is said that Mr. Ramsay never said that. We are agreed in one thing at any rate, that Mr. Ramsay is a gentleman on whose word we can rely. Here is what he says in his certificate:
1. I came to Hamilton, Canada, in the year 1859 in the capacity of manager of the Canada Life Assurance Co., and entered on that duty in that year and continued in that office until the year 1874, when I was elected a director of the company and was then appointed managing director and continued to fill that position until December, 1899. I was elected as president of the company in the year 1875, and filled that office continuously up to December, 1899, when I resigned my position as a director and thereupon ceased to be president.
I had thus been connected with the company continuously from August, 1859, to December, 1899, in these positions. [DOT]
2. When I entered on my duties as manager I found that the paid up capital stock of the company was about $100,000, which was by