April 21, 1910

LIB

William Pugsley (Minister of Public Works)

Liberal

Mr. PUGSLEY.

I have no objection at all.

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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

If an hon. member of this House were to make a charge in the form the minister prefers, by whom would! that charge be investigated; would it bo' by a committee of this House?

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LIB

William Pugsley (Minister of Public Works)

Liberal

Mr. PUGSLEY.

There is a regular and well established procedure for the investigation of such charges and the hon. gentleman should know that.

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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

Will you answer the question?

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LIB

William Pugsley (Minister of Public Works)

Liberal

Mr. PUGSLEY.

It is enough for me to say now that the hon. gentleman (Mr. Crocket) although he has had the courage to insinuate, has not had the courage to make a direct charge which would in-* volve-

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CON
LIB
?

Some hon. MEMBERS

Sit down.

Mr. PUGSLEY-which, Sir, would involve serious consequences to him.

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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

Will the hon. minister-

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?

Some hon. MEMBERS

Sit down.

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LIB

James Kirkpatrick Kerr (Speaker of the Senate)

Liberal

Mr. SPEAKER.

I have already said several times that the hon. member addressing the House cannot be interrupted.

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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

I have asked a quesr tion and he refuses to answer it.

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?

Some hon. MEMBERS

Sit down.

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LIB

William Pugsley (Minister of Public Works)

Liberal

Mr. PUGSLEY.

The hon. gentleman (Mr. Crocket) has not had the courage to make a charge which would involve upon him the serious consequences which a member of this House should suffer if he makes a cha'rge which he cannot substantiate. Now, Sir, I declare to this House that the evidence of Mr. Murray is absolutely true: that when he and Mr. Robertson visited Ottawa the subject of this Richibucto wharf was not mentioned between us, was never referred to in any conversation which we had while they were at Ottawa. The hon. gentleman (Mr. Crocket)- has not ventured to say that he would question any statement I would make, but he says that he would not believe the statement of Mr. Murray, and that he would rather take the evidence of Mr. O'Leary than the evidence of Mr. Murray. Well, Mr. O'Leary cannot tell what took place at Ottawa and Mr. Murray would know whether he had a conversation with me or not, and whether he received any advice or instruction or not, and Mr. Murray swore positively that he had no conversation with me on the subject of the purchase of this wharf property. And, if it were to become a ques tion as to who was telling the truth as to what took place in Richibucto- in regard to which I am in no way concerned, with regard to which the chief engineer of my department is in no way concerned- with regard to which the deputy minister of my departmnt is in no way concerned- but if I were called upon to determine from what has taken place in this case as to which of these two men is entitled to the greatest credence, I would say that I would infinitely prefer-and the members of this House who have read the evidence _ carefully w/ould infinitely prefer-to give credence to the evidence of Thomas O. Murray rather than to the evidence of Richard O'Leary. And, I will tell you why. Mr. Richard O'Leary came here determined if he could to make out a case against my department and against me-l say that advisedly-and he showed a willingness to swear to anything which would tend to the accomplishment of that end. Let me show the House the grounds

upon which I make that statement. To begin with, Richard O'Leary swore that I wrote him a letter in the fall of 1908, which I did, and which I shall invite the attention of the House to, as the hon. member (Mr. Crocket) has not chosen to do so. Mr. O'Leary swore that he wrote me a reply and he produced what purported to be a copy of the reply he had sent me. Hon. gentlemen will find that at page 45 of the evidence and in that pretended letter to me Mr. O'Leary writes that Mr. Murray came to him, apparenty acting as agent of the Public Works Department and gave him to understand that he was buying the property for the government. Well, if that had been true, if Mr. Murray had represented that he was the agent of the department as is stated in that pretended letter of Mr. O'Leary's which he says he sent me, then Mr. Murray would be obliged to account to the department for the difference between the '$700 and the $5,000 which he received from the government. I cannot but think that Mr. O'Leary deliberately intended to make the committee believe that he had sent a copy of that letter to me. It was a confidential letter. He supposed I had not kept a copy of it, and he came here before that committee intending to make the committee believe that Mr. Murray represented himself as being an agent of the department. Fortunately, Mr. Speaker, I had the letter which I had received from Mr. O'Leary, and I produced it, and you will find it on page 46 of the evidence, but you will find no statement in it that Mr. Murray represented that he was acting as agent of the department. That letter which I received is a letter entirely different in character from the letter Mr. O'Leary said he sent to me so far as that most important fact is concerned. I say Sir, that that incident stamps Mr. O'Leary as being a man upon whose evidence but little reliance can be placed. But, what further is the position which Mr. O'Leary occupied as a witness? When seeking to depreciate the value not only of this property but of all property in the town of Richibucto he went so far as to declare that the wharf property occupied by himself and which had cost him $1,500, was only worth $2,000, and he said he was willing to sell it for $2,000. Before the committee he pledged his solemn oath that he was willing to take $2,000 for that property. And, the hon. member from York said: Oh, could any one for a moment think he was willing to sell it for $2,000? Well, I would say probably not in the light of the other testimony we had from Mr. O'Leary. But assuming that Mr. O'Leary was a truthful man upon whose evidence reliance could, be placed one had a right to believe he would sell that property for $2,000. Well, Messrs.

Loggie saw in the newspapers that he had made that sworn statement before the committee and they being willing, nay, they being anxious to secure a good property at a low price, they at once telegraphed to Mr. Carvell asking him to offer Mr. O'Leary, if necessary, $2,500 for the property which he swore he would sell for $2,000.

But when Mr. O'Leary found that there were people who were willing to buy, he at once went back on his oath and said he was not willing to sell the property for either $2,000 or $2,500. Mr. O'Leary, in order to-influence the committee in respect to the value of the property which the department had bought, deliberately swears that a property which the evidence showed to be well worth $8,000, is worth only some $2,000;. and yet although he had sworn he would, do so, when a purchaser presents himself he would not consent to sell it for that amount or even for $2,500. What further have we as tending to discredit the evidence of Mr. O'Leary? He went further and said: * This property is absolutely without value; I held it for years, it was of no value to me, and I offered the whole property to Mr. Waterbury, the agent of the department, a few years ago for the sum of $1,000.' If we had not the documents to disprove Mr. O'Leary's statement, we would have been placed in this position, that the department had bought at a larger price a property which a few years ago had been offered to it for the sum of $1,000. In the face of what I am going to tell this House, we cannot believe that Mr. O'Leary had forgotten what had taken place. We cannot believe that he, having offered only a small part of this property for $1,000, was telling what he believed to be true when he said that he had offered the whole property for $1,000. But that was the statement he deliberately made in the committee, evidently believing that the offer had not been put in writing, and that we would not be able to produce any documentary evidence to show that he made a statement to the committee which he knew to be untrue. After that statement was made, I sent for Mr. Waterbury, who is the superintendent of buildings in New Brunswick for the Department of Public Works, a man who is very careful in the way he looks after the business of the government, and asked him if he had not some document to show what had taken place between him and Mr. O'Leary at that time. Although it was four or five years ago, he was fortunately able to produce a letter written by Mr. O'Leary at that time. His evidence was that Mr. O'Leary having told him what he would sell a portion of this property for, he had asked Mr. O'Leary to put the proposition in writing, and he produced a letter containing Mr. O'Leary's

proposition, which he said was the only proposition Mr. O'Leary had made to him. tf hon. gentlemen desire to see what Mr.. Waterbury said on that point, they will find his evidence at pages 168, 169, 170 and 171. They will find the letter of Mr. O'Leary set forth on page 72. It is a little out of its order, not having been given in the evidence of Mr. Waterbury, but in the evidence of Mr. O'Leary. You can see, Mr. Speaker, how important that letter was. You can understand what a strong point would have been made against the government if, having had an offer from Mr. O'Leary some five years ago to sell this whole property for $1,000, the department, without making any further inquiries, without going to see Mr. O'Leary, without Telferring the matter to the Exchequer Court, without having an arbitration or anything of the kind, had actually paid $5,000 for the same property. But upon an examination of that letter, we find that what Mr. O'Leary at that time was careful to do was to reserve a space of about" 150 feet between the railway wharf and thd piece of property he proposed to sell to the government. He was careful also to reserve another strip of about 200 feet, or perhaps even more, between the property he proposed to sell to the government and his own wharf property farther along the river; offering the department a strip out of the centre, and reserving a space on each side. That is what he proposed to sell for the sum of $1,000, based on a valuation of somewhere in the neighbourhood of $3,000 for the whole property. He made the department a second offer of [DOT] another small piece for $500, which was based on a valuation of $10,000 for the entire property ; and he made a third offer of a smaller piece still, which was based on a valuation of $20,000 for the entire property. When we had on the' stand, a glib witness like Mr. O'Leary,' who is one of the strongest partisans in the province of New Brunswick, and when' we found him deliberately swearing that he had offered the whole of that property' to the government for the paltry sum of $1,000, was it not a fortunate thing that we were able to face him with his own letter, in which he made the proposition' to sell a small piece at the rate of $20,000 for the whole, a larger piece at the rate of $10,000 for the whole, and a still larger and less valuable piece at the rate of $3,000 for the whole? Having been able to corn front Mr. O'Leary with this documentary evidence, I repeat with all confidence the statement I made a short time ago, that I for one would infinitely prefer to take the evidence of Mr. Thomas O. Murray to the evidence of Mr. Bichard O'Leary. I think it is important that Mr. Murray has made the statement-and his evidence was in no Mr. PUGSLEY.

way contradicted or discredited-that no communication, either verbal or written, ever took place between him and myself before the report was made upon this property, and which was made in consequence of an application submitted to my department in the regular way.

Having made these preliminary observations, let me just state briefly what took place, so far as my department was concerned, and so far as I as Minister of Public Works was concerned. Early in the spring of 1908 I was urged to purchase what was known as the municipal wharf in Richibucto. That matter had been pending before my department for some two or three years. After I became minister, I freely confess, I became impressed with the desirability of doing what would be reasonably necessary in order to give improvements to the harbour of Bichibucto, as I had been doings in respect to a great many harbours all over Canada. It is part of my business as Minister of Public Works to encourage the transportation interests of this country so far as they concern our rivers, lakes and harbours. Therefore, I felt it my duty to give respectful attention to the representations made to me on behalf of the very important town of Richibucto. I say important advisedly, because that town has a glorious history. It is a town which in the early days of the province of New Brunswick did an enormous business, a business which to a certain extent has passed away; but it is a town splendidly situated for business. Situated as it is, it can become an important point for the distribution of coal from the rich coal mines of Nova Scotia; it is a most important fishing centre; and although Mr. O'Leary may think that the business of the town is declining, that simply means that his business is declining and is being done by Messrs. Loggie, Mr. Forbes and the other people who are coming in there and helping to provide facilities for carrying on a large and profitable trade. Well, although Mr. O'Leary thinks that, or appears to think that, yet Richibucto is improving. That is the evidence we had before us. I say again it is splendidly situated several miles from the mouth of the Richibucto river, and very large ocean steamers can pass and repass right in front of this wharf and the other wharfs in the town of Richibucto. Well, Sir, of recent years this government has undertaken a system of improvement of the port pf Richibucto. We are building breakwaters, we are giving protection to the harbour. We have been endeavouring for some years to afford to vessels better facilities, and we believe we are accomplishing a good work. Therefore, in view of what we are doing now, in view of what I thought were the possibilities of traffic in the future, I was willing to lend a favourable ear to the

representations made to me as to the necessity of making harbour improvements in the port of Richibucto. Now, hon. gentlemen will say that these improvements are largely for the benefit of the Kent Northern railway. Mr. Speaker, can you imagine a case where you make improvements for the transhipment from the water . to the railway in which you do not generally benefit the railway. Take the city of St. John. Take the great national work which we are doing there upon the western side of the harbour, giving to the people of western Canada the means of getting the products of their fertile prairie lands to the markets of the world through Canadian ports. Are we not benefiting the Canadian Pacific railway? Every ton of freight which comes over the Canadian Pacific railway and every ton of freight which is transferred from the steamship to the railway or which is transferred from the railway to the steamship, to a large extent benefits the railway company, but it benefits the public at the same time. You cannot improve the transportation facilities of this country without conferring a benefit upon all. So with regard to Richibucto. By giving facilities to the steamers that come to the wharf immediately adjoining the railway, giving greater facilities for the transfer of goods from the vessels to the railway and from the railway to the vessels, we will necessarily improve the trade of the port and advance the interests of the public, while at the same time we must necessarily render some advantage to the railway company, because by doing that we will increase the facilities for carrying on their business. Therefore, Sir, I decided to do there what I am doing in all other parts of this country, that is, seeking to improve the transportation facilities for the people. Later on in the spring, in the month of May, when it was urged upon me that this municipal wharf which we were buying had onlv a frontage of about 150 feet, certainly not exceeding 200 feet, and that the Tailway track which was going down the wharf was such that it would be necessary to back a train down in order to get a car near the edge of the wharf, and that the end car would necessarily be at right angles to the face of the wharf, and knowing from mv experience in the city of St. John and other places what a great inconvenience a track so located would be, so far as transferring freight from the railway to the vessels, and from the vessels to the railway, was concerned, I made up my mind that it would be desirable to have that wharf extended so that the railway track could be carried along the face of the wharf and made parallel to the vessels as they lay off the wharf.

Every man who knows anything about terminal facilities will recognize the force

of what I am saying, that to afford a convenience to the merchants and the manufacturers and the railway company to which they are reasonably entitled, it is necessary to have a greater frontage, so far as a wharf is concerned, than 150 feet which is I believe the frontage of the municipal wharf. Therefore, although I did not decide what I would do, and although I gave no indication as to what I intended to do, yet when that request was made to me on May 20, 1908, I thought it was my duty to have the matter looked into and to have a report made. And, Sir, that is what I did, and so far as this record shows and so far as any facts which have come to the knowledge of my hon. friend (Mr. Crocket) will show that is the first step which my department took in connection with the purchase of this wharf property. The request came to me dated May 20, 1908, made in a regular way, made on behalf of the Kent Northern Railway Company, urging that additional terminal facilities were required at the port of Richibucto, and asking if I would take the necessary steps to secure these facilities. All I did was in the usual and ordinary way, to make an order to the chief engineer to have an examination and report made. I have not given the exact words, but hon. gentlemen will find them there in the evidence. It was the usual order, an order made in hundreds of cases. It is always my practice when an application comes which I think is worth being inquired into, it is always my practice to hand that application at once to my secretary, and to ask that an order for the chief engineer be made out. In this case the language used is identical with that used in hundreds of other orders which hon. gentlemen will find upon the files in the department. Well, Sir, it went to the chief engineer. The chief engineer some four days afterwards sent it forward to the resident engineer with directions that he should as early as possible have a report made with regard to the additional wharfage required at Richibucto and generally upon the subject. Well then, what next took place? It appears from the evidence that Mr. Stead goes to Richibucto for the purpose of making 'an examination and report, and while at Richibucto he meets Mr. Murray, also Mr. Robertson and others. He makes the examination as to the wharf and he asks Mr. Murray so that he might report to the department, what he is asking for this property. Bear in mind, Mr. Speaker, that at that time, this property had been bought by Mr. Murray. Mr. Murray was the owner and when my hon. friend (Mr. Reid) says that Mr. Murray was a middleman, I say he was not. Mr. Murray had become the owner of that property and he had become the

owner as this record shows, and as I declare to this House without any intimation from me or from anybody acting with my authority that the department would purchase that property. Mr. Stead says that after talking the matter over with Mr. Murray he asked him to name his lowest price so that he might make a statement to the department and give it information as to the amount it would take to purchase the property if the government should decide to buy, and Mr. Murray fixed the price at $5,000. Now, what next comes to my department? We find a report from the resident engineer which hon. gentlemen will find on pages 56 and 63 of the evidence. The fust report is on page 56 and is dated June 9, 1908:

Sir,-As requested in your letter of the 27th May. I have looked into the matter of the wharf accommodation which has been asked for at Eichibucto, Kent county, New Brunswick.

On the 10th of March, 1908, I reported ou the proposed acquirement by the department of the municipal wharf at Richibuoto.

It is now asked that the wharf known as the ' sawdust wharf,' formerly used as a site for a saw-mill, which is situated immediately below the municipal wharf, he also required. Included with this wharf is the area in the rear which has a frontage on the main street of about 443 feet and lies just opposite the lot already acquired by the government for the site of the new public building. The total length of the area measured parallel to the main street is <30 feet.

And I would like hon. members who know anything of the value of water frontage, and particularly those hon. gentlemen who so vociferously applauded the hon. member for York (Mr. Crocket) when he was presenting his half-measured case for their consideration, to bear in mind what that means. This property is right in the heart of a town of 1,000 people, and fronts upon a river up and down which ocean steamers drawing from 18 to 20 feet of water can pass without difficulty. Measure in your own minds what that means-to have a wharf property in the centre of a town of that size, with the prospects of Richibucto, a property 730 feet on the water, and 400 feet frontage on the main street of the town.

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CON

Richard Blain

Conservative (1867-1942)

Mr. BLAIN.

May I be permitted to say that the postal revenue of the town is small.

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LIB

William Pugsley (Minister of Public Works)

Liberal

Mr. PUGSLEY.

I do not care. I know what Richibucto is; I know the business that is being done there. Besides, we have the evidence of men from that town-of Mr. Carter, of Mr. Irving, also of Mr. Forster, and others. And we have the statement of Mr. Forbes and twenty or thirty others of the prominent men of the town.

The report of the engineer further states:

The shallow point lying between the municipal wharf and the sawdust wharf, former-Mr. PUGSLEY.

ly used as a timber pond in connection with the mill property is also included. The area which the government is asked to acquire is 9 acres of land, and land on the water reaching to the channel, that is, to about the face of the wharf. Four acres of this -is land and wharf above high-water line.

Including the 200 feet pier head of the municipal wharf, this would give a frontage on the river of about 775 feet

It is looked upon as certain that the Kent and Northern railway will shortly he taken over by the government and this land and wharf will furnish a very desirable and central site for the station, railway yards, and especially for an ample deep-water terminus.

An offer to sell the wharf, water rights and land area for $5,000 is inclosed herewith.

While the outer faces of the wharf are gone to about low-water level and new crib-work will he required there, the wharf forms a wide approach to deep water, and could not he built now for several times the amount asked. Taking into account also the value of the frontage on the street, and its central position, the price asked is reasonable.

A right-of-way through this land must shortly be bought by the government for a sewer for the public buildings.

The correspondence received with your letter and also a plan of the property are inclosed herewith.

Yours obediently,

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GEOFFREY STEAD,


Resident Engineer. E. D. Lafledr, Esq., Chief Engineer, Department of Public Works, Ottawa. Then, on page 60 is a supplementary report from Mr. Stead: 10th June, 1908. Sir,-In my report of yesterday's date, on Richibucto sawdust wharf, instead of saying that the wharf ' could not he built now for several times the amount asked ' I might have stated more definitely that it contains about 1,000,000 cubic feet of cribwork, slabs and mill refuse, ballast and gravel. Classing this all as filling-new cribwork faces being required-it would cost about one and a half cent per" cubic foot or $15,000-three times the price asked for the property. Yours obediently,


GEOFFREY STEAD,


Resident Engineer. Now, it is important, I think that, when a charge of corruption, misfeasance and fraud is being made against, I do not know whom-it may be either against Mr. Stead, the resident engineer, the chief engineer, the assistant engineer, the deputy minister, or myself; the hon. member (Mr. Crocket) has not specified against whom he makes the charge-it is important, I say, to bear in mind that, down to the time when the resident engineer makes that report, there is not a tittle of evidence that either I or any officer of my department made any suggestion to Mr. Stead with reference to the report he should make. I was on the witness stand; Mr. Stead was on the wit- ness stand. If the hon. gentleman (Mr. Crocket) suspected that any influence had been brought to bear upon Mr. Stead by any suggestion made to him, surely it was his duty to make inquiry upon that point. He did not do it; and, as I have said, there is not a particle of evidence that any suggestion was made by me or by any officer of my department to the resident engineer as to the report he should make upon thi3 property. And we find that the report and supplementary report show the nature and position of the property-show that there were 1,000,000 cubic feet of filling which could -not be put there for less than $15,000 and contained a plain declaration that the price of $5,000 for the property was fair and reasonable. Now, what next took place? The hon. gentleman (Mr. Crocket) would have you believe that I was anxious to purchase this property, that I had arranged to purchase it and was only awaiting the report of the engineer-whose report, he says, I told the chief engineer in writing to get without delay, a statement which as I have stated, is absolutely without foundation. I did nothing further in the matter, so far as the records show, between the time when this report comes in on June 10, to about the 9th of August, a space of two months. During that time, my attention was given to other matters. I presume that I read the report I do not recollect at the moment; my attention was given to other matters of great importance in all sections of this country. I am pressed again to acquire this property. I have not then made up my mind what I shall do; and, in August, I make an order for another report. Hon. members will find that report at page 60 of the evidence. This report came in. It was dated at Chatham, the 8th of August, and wa3 as follows: Sir,-In reply to your letter No. 4255 of the 4th August, in which you ask for a report on the value of an additional wharf property required at Richibucto, New Brunswick, I give the following extract from my report on the property, dated 9th June, 1908, and a copy of my note in further reference to the subject, dated 10th J une, 1908. Then follows this quotation: ' An offer to sell the wharf, water rights and land area for $5,000 is inclosed herewith/ While the outer faces of the wharf are gone, to about low water level and new crib-work will be required there, the wharf forms a wide approach to deep water, and could not be built now for several times the amount asked. Taking into account also the value of the frontage on the street, and its central position, the price asked is reasonable. A right of way through this land must shortly be bought by the government for a sewer for the public buildings. So,. you will see, Mr. Stead reiterates the report he made on 9th and 10th June. I mention this to show that I was displaying no eagerness in reference to the purchase of the property. After the report of June 9, I took no action until I ordered the next report in August. I do not remember at the moment whether I wanted further information or what the point was. I considered the matter very carefully, and am free to say that I thought the price of $5,000 stated by resident engineer Stead, and approved by the chief engineer was a reasonable (price;. I had nothing within my knowledge to indicate that it was anything but a reasonable price. I have some knowledge of wharf property, and its value, both upon the north shore and in the city of St.. John, and I have the report of the engineer that this was a property having a frontage of 730 feet on the Richibucto river, a property where there was a million cubic feet of mill refuse, gravel and ballast-there must have been a large quantity of ballast, because it showed above the water, and there must have been a vast amount of cribwork underneath or that would have been washed away years ago. It was a property with a frontage of 400 feet on the main street, and with a depth of over 600 feet, which meant nearly ten acres of land. I confess I thought that $5,000 was a ridiculously low price for this property. I was prepared to act upon the report of the resident engineer, approved of as it was by the chief engineer of my department. But the hon, gentleman says that later on-and I am going to call attention to that-later on I wrote to the resident engineer that he should have called my attention to the fact that there had been a recent transfer of this property and he should have stated the price. The hon. gentleman says, why, when that report came in, and when you acted upon it, you knew just as well then as you knew afterwards that he had failed to make reference to transfers. The hon. gentleman has omitted one important fact, and that is that I had no knowledge, and the evidence does not show that I had any knowledge, and I affirm 'before this House that I had no knowledge, that Mr. Murray had bought this property from Richard O'Leary. I had no knowledge whatever upon the subject, there was nothing in the report, there was nothing in anything that had taken place, to indicate, but what Mr. Murray had been for a considerable time the owner of this property. Therefore when I saw this report making no mention of any recent transfers, I took it for granted that Mr. Murray had been the owner of the .property for a number of years.


April 21, 1910