June 26, 1925

CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Does the minister say

that to the best of his recollection the question of consenting to this judgment never came before the government as a whole?

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

I am sure

it must have come before the government, but I must confess I have no recollection of the matter.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

I do not wish in the face of the answer of the minister to make any unfair reference to him, but I do protest against any government consenting to a judgment and then paying the money out on that judgment without coming to parliament. The Exchequer Court Act, of course provides that a judgment of the Exchequer court can be paid merely out of consolidated revenue, but the contemplation of that act was a judgment rendered on the finding of the judge himself, not merely on the approval or finding of the government. It never for a moment was thought it would be a mere means of providing a government with power to pay out public money without recourse to parliament, on the will of the government alone. But that appears to be what was done in this case. If what the hon. member for the Yukon says is right and a judgment was rendered without the mind of the Exchequer court judge being applied to the case at all, if it was done merely on the consent of the government, the government should have come to parliament for authority to pay that money, and there should have been no consent unless parliament approved. It is simply defying the rights of the people.

I do not know anything about the merits of the ease. I am pretty much in the position of the minister. I have a hazy recollection of it, and it is not so hazy after all; it is coming clearer to me, a case amounting to nothing less than a huge magnificent fraud that lay in the Exchequer court for years. I remember it coming before me occasionally, and the very thought of a settlement being spumed, and I am amazed to hear that this government consented to pay out public money to

Supply-Interior

the extent of $100,000 on a claim of that kind. Can anyone tell us who were counsel for the claimants?

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

I cannot. I was just going to remark that we have a recent case, that of Maunsell, against the Department of the Interior for illegal cancellation of a lease. It comes to my mind because it is recent. I immediately took steps to appeal, to protect our interests in the matter. But the case my hon. friend from the Yukon speaks of, I have no recollection of at all. However, I shall be glad to get the information.

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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

I would like to find out who were the lawyers in this case. While I cannot pretend to any intimacy with the details, the impression that was left on my mind was that the claim was nothing but an unmitigated and colossal scandal.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

Would the

minister kindly tell us whether this particular case was handled by the Department of Justice, or whether it was handed out to some political legal friends?

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

I would not like to make any statement on the case at all. I have a hazy recollection of the case, at least I think it is the one, but without refreshing my memory with respect to the whole thing, it is difficult to recall any particulars. Undoubtedly the Department of Justice would be handling the case.

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LIB

Ernest Lapointe (Minister of Justice and Attorney General of Canada)

Liberal

Mr. LAPOINTE:

I do not think any agent of the Department of Justice would have agreed to a judgment by consent without the authorization of the department. I do not think this case has come before me while I have been in charge of the department.

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CON

George Black

Conservative (1867-1942)

Mr. BLACK (Yukon):

I might inform the committee that the solicitors for the suppliant were Aylesworth, Wright, Thompson and Company. The case was never tried by the courts. The government cannot excuse itself by saying it had to carry out a judgment, because the merits of the case were never gone into by the court. It passed through the Exchequer court in the first place on the technical defence which I have outlined to the committee, and was ultimately sent back by the Privy Council to the court for trial on its merits. The merits were never gone into for the reason I suppose that there were no merits. The claim consists of about fifteen items amounting in all to $17,619,000. It reads like a fairy tale, for no one living in Yukon and having seen the ground would say anything but that this claim is absolutely ridiculous. They could not conjure up $2,000,000 let- alone $17,000,000 for the whole lease.

To provide for the operation, maintenance, and settlement of the Canada Land and Irrigation Company's project in the province of Alberta, subject to security for repayment with interest upon terms arranged by the authority of the Governor in Council. Appointments and payments may be made notwithstanding anything in the Civil Service Act or regulations thereunder, $100,000.

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

This is to

provide funds to carry on the Canada Land and Irrigation Company's project for one year. We covered this matter fully in the estimates before. We have a first mortgage investment of $400,000 and this will of course increase it by $100,000 in addition to the $20,000 which we loaned the project last year to carry on. So that we shall have slightly over $500,000 against the undertaking, which has cost $15,000,000. The liquidator hopes to make a sale this year, but that is rather doubtful.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

Are we doing

the actual work ourselves or are we advancing the funds to the company to do it?

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

It is done

under our own manager. We have also our own staff.

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CON
LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

We have

Mr. Hays, the former manager, in our employ. He has a large farm in the district and is a thoroughly trained irrigation engineer. It is possible that if he had been there at the inception of the work things would not be in the present difficulty. Mr. Meek of the Irrigation department, one of our own officers, is in charge.

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CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

The next item I suppose is really the same thing.

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

Yes.

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Item agreed to. Amount required to pay Messrs. R. R. Hall and William Irwin, of Peterborough, upon the relinquishment of their interest in timber berth No. 507, $120,430.


CON

Henry Lumley Drayton

Conservative (1867-1942)

Sir HENRY DRAYTON:

This is an old

matter and the minister has sent me the files in connection with it but I confess I have not been able to get at the bottom of it. I recall that at one time when the previous government was in office a similar proposition was made to them but was rejected, but I cannot pretend to have any distinct recollection of the fact3.

Supply-Interior

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LIB

Charles A. Stewart (Minister of Mines; Minister of the Interior; Superintendent-General of Indian Affairs)

Liberal

Mr. STEWART (Argenteuil):

I suppose

that my hort. friend has read the memorandum prepared on the subject, giving the history of the acquisition of this timber area in British Columbia near New Westminster. Some years ago while the berth was held by the present holders, Messrs. Hall and Irwin of Peterborough, steps were taken to preserve a reservoir which was created for the use of New Westminster. Some mistake was made in the department at the time and Messrs. Hall and Irwin failed to be notified, so that they did not discover the circumstances in connection with the reservation until they had entered into an agreement of sale for the property when they found that they could not transfer the property inasmuch as the reservation had been placed on the greater portion of the timber area to prevent the pollution of the water.

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CON

June 26, 1925