March 14, 1930

CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

Having come down to the year 1924, I point out that no action was taken in 1925, but I will come presently to something more important than that. In 1926 we had the customs inquiry and it will be observed that in the report which was made by the chairman a supporter of the government, the hon. member for St. Henri (Mr. Mercier), it was provided that the investigation should be carried on further to indicate

how far the corruption had gone and how far the iniquities disclosed had prevailed. That is what happened.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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LIB

Lucien Cannon (Solicitor General of Canada)

Liberal

Mr. CANNON:

During the Conservative regime.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

There has been no Conservative regime from 1921 down to the present day except for a few short months. The responsibility rests with the Liberal party and with the Liberal administration, and no casuistry can for a single moment change that fact.

Now, sir, in 1924, in consequence of efforts made by the United States authorities to secure an arrangement with Canada to prevent smuggling, a treaty was negotiated by the hon. Minister of Justice (Mr. Lapointe) and the Secretary of State for the United States, Mr. Charles Evans Hughes. That treaty bears date, Washington, June 6, 1924, and we now know something more than heretofore of the circumstances under which it was negotiated. But let me make reference to the following words which appear in the very preamble of the treaty:

Treaty for the suppression of smuggling operations along the international boundary between the Dominion of Canada and the United States and assisting in the arrest and prosecution of persons violating the narcotic laws of either government and for kindred purposes.

His Majesty the King of the United Kingdom of Great Britain and Ireland and of the British Dominions beyond the seas, Emperor of India, in respect of the Dominion of Canada, and the United States of America being desirous of suppressing smuggling operations along the boundary between the Dominion of Canada and the United States of America.

And so on. Not regulating it, but suppressing it. When, sir, you heard to-day read to the house the regulation sent out by Mr. Breadner as to how and where liquor could foe sent across to the United States, those were regulations to assist the bootleggers to get liquor into the United States, whereas the treaty was for the suppression of smuggling. That is how the government suppressed smuggling. That is the method by which it was done. Could anything be more hypocritical than that? This is the treaty to suppress smuggling, and the regulations read to-day are for the purpose of getting the liquor out of bond, into the hands of bootleggers and so into the United States.

Let us turn to article 2 of the treaty. Perhaps it would be better to deal first with article 1 which provides for certain information being given concerning transportation of cargoes that were subject to duty, then for information concerning clearances of vessels

Export Act-Mr. Bennett

to any ports where there was ground to suspect that the owners or persons in possession of the cargo intended to smuggle it into the territory of the United States. Following that we have this:

The high contracting parties agree that clearance from Canada or from the United States shall be denied to any vessel carrying cargo consisting of articles the importation of which into the territory of Canada or of the United States, as the case may be, is prohibited-

It did not stop there. It then proceeded:

-when it is evident from the tonnage, size and general character of the vessel, or the length of the voyage and the perils or conditions of navigation attendant upon it that the vessel will be unable to carry its cargo to the destination proposed in the application for clearance.

Let me put this to the house: suppose, under the regulations that were issued, you desire to export fraudulently 100 eases of whiskey to the United States. You have a little motor yacht and go up to the customs house and say: "We want a clearance for Santa Cruz or Havana." "Well," the customs house officer says, "what is the size of your boat?" "Oh, she is a little motorboat of four or five tons." He replies, "It is perfectly clear that you do not intend to ever go to Havana or Santa Cruz with that boat from Windsor," and therefore he refuses the clearance. But if the next day the same man went up to the Collector of Customs and said: "I want to export 100 cases of liquor to the United States." the officer would give him a clearance. That is as the treaty was negotiated, after listening to the wise words of Lord Curzon. That is the treaty negotiated in view of the peril to the British Empire and to Canada. Let my hon. friends go back and tell their constituents that this government which they cheer so lustily, negotiated in 1924 a treaty that permitted them to refuse, in fact more than that, it prohibited the granting of clearances to small boats that cleared for Mexico or Havana, but permitted clearance to be granted to a boat that cleared for Detroit. I did not realize the true significance of this until I heard the observations this afternoon from the right hon. gentleman. With his statement as to what Lord Curzon had said, I can understand how his conscience has been bothering him all these years and 1 can realize, the enormous worries he must have had in consequence of having negotiated a treaty like that, or an arrangement that is dignified with the name of treaty.

Let us go a step further. This treaty was not ratified until 1925. As a matter of fact it was not ratified until July, 1925. Therefore, in 1925, if we take this chronologically, we had in force this treaty made with the United

States of America. Of course they believed that we were acting in the utmost good faith, and we bellieved that they were, because, mark you, the terms are reciprocal!. Not one side only is affected; both are affected. They undertook to d'o for us the same as we undertook to do for them. The present legislation is not reciprocal. The treaty was reciprocal. By the provisions of this reciprocal treaty made between the United States and Canada under the circumstances to which I have referred, we issued the regulations, the permits, the forms produced by the Prime Minister this afternoon. We prepared them and under them shipped out of this country hundreds of thousands of dollars, yes, in the aggregate more than $100,000,000 worth of liquor into the United States and cleared it for the United States, although if some one with a five-ton boat, thinking he could only do this fraudulently said: "I am going to Havana," he could not get a clearance at all.

We will leave that and turn to what happened in the ensuing years. It is right that the Canadian people should know what took place. Here is the correspondence which was produced by the Prime Minister yesterday, which was laid before the Senate last session and which indicates what was taking place between Canada and the United States in connection with these very matters. The law officers of the United States were plainly observing the operations of the treaty ns I have pointed out. They were indicating how ridiculous it was that this situation should exist. They were asking: Were we sincere? Why did we not make a treaty, a real treaty like the one they wanted us to make? Mark you, the evidence in these despatches is that they asked for a treaty, prohibiting clearances, and the government refused. The Minister of Justice (Mr. Lapointe), who is sitting opposite, knows that is what they sought. That is evident from these despatches, but the Prime Minister refused to agree and all the time he was refusing he knew of the terrible menace to the life of Canada.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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LIB

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

Liberal

Mr. LAPOINTE:

May I say to my hon.

friend-

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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?

Some hon. MEMBERS:

Order.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

All right. Let my hon.

friend continue.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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LIB

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

Liberal

Mr. LAPOINTE:

No. My hon. friend's friends do not want me to.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

I am sure I shall be glad if my hon. friend desires to ask a question.

Export Act-Mr. Bennett

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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LIB

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

Liberal

Mr. LAPOINTE:

I know my hon. friend

has the courtesy to permit this, but I shall not take advantage of it.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

If for a moment my

friends were emulating my hon. friend's friends, they will now forget it. May I proceed? I am now speaking of the year 1925, and the matter is becoming somewhat important. On the sixth day of October, 1925, the British embassy, there being at that time no permanent ambassador at Washington, Mr. Chilton being the charge d'affaires, wrote a letter to Lord Byng, then Governor General of Canada. May I ask you, sir, to listen attentively to these words:

With reference to previous correspondence respecting the agreements now in force between Canada and the United States for the prevention of liquor and drug smuggling across the international border and the extradition of persons charged with offences in connection therewith, I have the honour to transmit to Your Excellency herewith copy of a note with enclosures from the United States government suggesting (1) that clearance be refused by the Dominion authorities to vessels carrying cargoes of liquor destined for the United States, (2) that a convention be concluded for the extradition between the United States and Canada of persons guilty of offences against the customs laws of either government, and (3) that a convention supplementary to that signed on June 6. 1924 be negotiated providing for the transportation of liquor to Telegraph Creek, B.C. via the Stikine river through Alaska.

The date of that is the sixth day of October, 1925, and the note enclosed by the Secretary of State, Mr. Frank B. Kellogg, under date of October 1, which is a rather lengthy document, contains a draft of a supplementary convention. He deals fully with the matter and said: I suggest to the Canadian people that here is the language that should be used in a supplementary convention or treaty dealing with clearances. The draft was as follows:

The high contracting parties agree that clearance of shipments of merchandise by water, air or land from any of the ports of either country to a port of entrance of the other country shall be denied if such shipment comprises articles the introduction of which is prohibited or restricted for whatever cause in the country to which such shipment is destined, provided, however, that such clearance shall not be denied on shipments of restricted merchandise when there has been complete compliance with the conditions of the laws of both countries.

Sir, nothing could be clearer than that statement. Mr. Kellogg submitted a draft of a paragraph to be introduced into a new convention, not in the terms of the bill that is before the house to-day, which is jug-handled, but a provision for a reciprocal arrangement between the United States and Canada declining clearances by water, air or land from any of the ports of either country

to a port of entrance of the other country, not of liquor, but of merchandise of any kind wherever, which under the law of the country to which the shipment was destined was prohibited or restricted. There you have as clear a statement of what the requirements of the United States were at that time as you can possibly conceive of being given. The despatch of Mr. Secretary of State Kellogg covers five or six typewritten pages in small type. He dealt with the matter at length. What did this government do then? Were the words of Lord Curzon then ringing in the ears of the Prime Minister (Mr. Mackenzie King)? Did he believe them then or not? Was he then giving leadership to the Canadian people? Did he then indicate to the Canadian people what the real situation was? Were the Canadian people being told then that there was a serious menace to our country and of the difficulties of a delicate character that confronted us? Did the Prime Minister at that time feel it his duty as leader, not of a party, but of this house, to tell the Canadian people what the situation was?

On December 11, 1925, Sir Esme Howard advised that he had not been able to secure the view of Canada on the suggestion of a new conference. Mark you, that was in December, 1925. The elections in 1925 were over, and no answer had been given at that date to the suggestion that came through the British embassy in Washington to our governor general with respect to a conference. In April, 1926, Sir Esme Howard again wrote to Lord Byng asking for information on the suggestion of a new conference. Sir Esme Howard again intimated that he had a further inquiry from the government of the United States of America. The despatches are in the file that has been brought down for our consideration. Sir Esme Howard went further. On June 21, 1926, he telegraphed to Lord Byng. Not only had he written without reply, but he telegraphed and in these words:

Manchester, Mass.,

June 21, 1926.

My despatch No. 237. State department inquire whether it would be possible for the Canadian government to arrange, within the next ten days, for the signature of the proposed supplementary conventions, so as to complete action in this matter before the recess of the United States Congress.

(Signed) Esme Howard.

What did Lord Byng reply? On June 25, 1926, he replied as follows-these are the vital words:

Canadian government is in substantial accord with the proposals of the United States government-

Export Act-Mr. Bennett

Listen, sir, again to the words:

Canadian government is in substantial accord with the proposals of the United States government and is prepared to arrange a conference at the earliest possible moment for the discussion of these proposals and of collateral questions. It is, however, not possible to say at the present moment whether such negotiations could be concluded in time to permit of approval by the Canadian parliament and the United States Congress before adjournment. A further communication will be forwarded on this point as soon as possible.

(Signed) Byng.

On the 25th day of June, 1926, the Canadian [DOT]government, speaking, of course, through the Governor General on the advice of the Prime Minister as Minister of External Affairs, the despatch being his, and not the Governor General's said: We are in substantial accord with the proposals of the United States government for a convention prohibiting clearances from this country.

What followed? Sir Esme Howard on September 14, 1926, sent a further communication to the Governor General enclosing a letter from Mr. Kellogg to the British embassy, *dated September 10, 1926, asking that the matter of a new conference be further considered.

Then the 6th of October, 1926, arrived. The Canadian election was over. According to the evidence the friends of the Prime Minister and the government on the border had done their duty. On October 6, 1926, we have this reply:

From His Excellency the Governor General of Canada

To His Britannic Majesty's Ambassador at Washington.

It is in this letter that reference is made for the first time' to the parliamentary committee and to the setting up of the royal commission. Listen to these words:

It is desired, however, to call attention to the fact that by order in council of the 28th September. 1926, the royal commission, appointed to continue inquiries which have been proceeding for some time into customs administration, has been instructed by the Canadian government to make an inquiry into the operation of the convention of June 6, 1924, and particularly as to whether any amendment is necessary or desirable to ensure the suppression of smuggling.

Those are the words of the government of that day. Then follow the names of the members of the commission, and its powers as indicated by the order in council already read this afternoon by the right hon. the Prime Minister. The letter continued:

In view of the fact that the above inquiry has been initiated and that the reports and recommendations of the royal commission will be of great value in the discussion of the interpretation and possible amendment of the existing convention and collateral questions, the Canadian government is of the opinion that it would be desirable to await its findings before setting a date for the proposed conference between representatives of Canada and the United States.

I shall be grateful if Your Excellency will bring the views of the Canadian government to the attention of the Secretary of State of the United States.

That was sent by Lord Willingdon. On October 21, 1926, Lord Willingdon telegraphed the British ambassador that the Hon. N. W. Rowell had been appointed counsel for the commission, and it was desired that he should have opportunity of conferring with representatives of the United States government regarding the operation of the present smuggling treaty between the United States and Canada so as to bring before the royal commission all relevant matters.

On November 9, 1926, Lord Willingdon again telegraphed to the British ambassador at Washington saying that the Hon. Mr. Rowell would be in Washington on the 13th of that month. Then the charge d'affaires of the British embassy, Washington, telegraphed to the Governor General, Ottawa, on November 10, indicating that Mr. Rowell's visit could be arranged. Following that, Mr. Rowell did in fact visit Washington and he found how the convention was operating. Mr. Chilton wrote to the Governor General on December 8, 1926:

The proposed conference appears to have been fully discussed with Mr. Rowell, who will doubtless have full information on the subject.

On December 7th of the same year, Mr. Secretary of State Kellogg had written a letter to the charge d'affaires, British embassy, Washington, in which he recited what had taken place, spoke of the early adjournment of congress, and asked what the government was prepared to do. He said:

As Mr. Rowell suggested that the situation be explained fully to the Canadian government. I have the honour to inquire whether you will be so good as to ascertain whether the Canadian authorities would be disposed to arrange for the proposed conference at an early date, since it is felt that a discussion of the problems involved will be mutually advantageous to both governments in preventing violations of their respective laws.

Not their laws, but their "respective" laws. Then followed a despatch from the Governor General dated February 15, 1927-still nothing done-in which he advised the British ambassador that he had received a letter from the Department of External Affairs setting out the views of the government on the subject, which he enclosed. The letter referred

Export Act-Mr. Bennett

to is dated February 14, 1927, and is signed by Mr. Skelton. In the course of the letter he said:

It is the view of the Canadian government that the conference should also consider whether any of the recommendations to the governments of Canada and the United States which may be made would most appropriately be carried out by a supplementary convention, by concurrent legislation, or by administrative regulation.

Now, sir, mark the date of that letter, the 14th of February, 1927. It will be noticed that months went by, and the months ran into a year, and not until the 27th of November, 1928, was any further action taken, after the Hon. William Phillips had come to Canada as the minister from the United States. Then you find that once more the question was raised. But during that long interval, despite the danger that attached to this country's very existence by reason of the conditions referred to by the Prime Minister not a single word was said, not a single line was sent to safeguard Canada from the imminent peril which confronted us.

I then come to the letter of the 27th November, 1928. And that is the first intimation, mark you, between then and the date of the preceding letter which I have quoted, that any action was taken. But perhaps I can call it six o'clock and deal with this letter after recess.

At six o'clock the house took recess.

After Recess

The house resumed at eight o'clock.

Topic:   EXPORT ACT AMENDMENT
Subtopic:   REFUSAL OF RELEASES AND CLEARANCES TO COUNTIES WHERE IMPORTATION OF LIQUOR FORBIDDEN
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PRIVATE BILLS

SECOND READINGS


Bill No. 27, respecting the Canadian Pacific Railway Company (division of capital stock). -Mr. Chevrier. Bill No. 28, respecting the Eastern Canada Savings and Loan Company.-Mr. Black (Halifax). Bill No. 29, to incorporate the Saint Nicholas Mutual Benefit Association.-Mr. Lueh-kovich. Bill No. 30, respecting the Canadian Pacific Railway Company (branch lines).-Mr. Power.


CORNWALL BRIDGE COMPANY


Mr. A. N. SMITH (Stormont) moved the second reading of Bill No. 26, to incorporate The Cornwall Bridge Company.


UFA
LIB

Arnold Neilson Smith

Liberal

Mr. SMITH (Stormont):

This is a bill to incorporate a company to build a bridge

from a point at or near Cornwall to Hog: island and then across to St. Regis island, to a point at or near St. Regis village. The whole of the bridge would be in the Dominion, of Canada although the southern end of it would be only about 500 feet from the United States boundary and state highway. So that we would have the advantage of an international bridge, yet it would be in the Dominion of Canada.

Motion agreed to and bill read the second time.

Topic:   CORNWALL BRIDGE COMPANY
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COPYRIGHT ACT AMENDMENT


On the order: Second reading of Bill No. 16, to amend and make operative certain provisions of the Copyright Act.-Mr. Ladner.


CON

Leon Johnson Ladner

Conservative (1867-1942)

Mr. LADNER:

Mr. Speaker, last year an intimation was given, rather of a positive kind, that the government would introduce legislation to the Copyright Act, and as there is a possibility of that legislation covering a considerable portion if not all the amendments proposed in the present bill, I would like to ask the hon. Secretary of State (Mr. Rinfret) whether there is any likelihood of the government introducing such legislation during this session.

Topic:   COPYRIGHT ACT AMENDMENT
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March 14, 1930