June 3, 1914 (12th Parliament, 3rd Session)

CON

Hugh Boulton Morphy

Conservative (1867-1942)

Mr. MORPHY:

The hon. gentleman will understand me. I am referring to the endorsements on the writ sent by McCarthy. Every kind of fraud in the calendar was charged against this man Travers. Mr. Fielding had evidence from Mr. Henderson that the bank under this man's administration was doing improper business. Mr. Fielding had information from Sir Edmund Osier that the money
was improperly and illegally borrowed. Mr. Fielding knew all this, and if he had made the inquiry that was incumbent upon him to make he would have discovered what kind of a man Travers was and turned out to be. A minister is human like any other man, but he owes a duty to himself and to his country, and we have evidence that Mr. Fielding failed to do his duty. He was guilty of negligence. To make myself clear I would just like to give two short definitionsofnegligencefrom the legal point of view, though I maintain that this question should not be discussed from the legal point of view but from the point of view of what is right and just. It should be discussed on the higher ground that the State owes a duty to the public, and should be discussed without any legal hairsplitting. A minister is chargeable with knowledge of what a reasonable inspection would disclose, and in this case Travers's perjury and the improper discounting of the notes to raise the money for the deposit would have been fully disclosed if Mr. Fielding had made further inquiries. His failure to act was a breach of duty or worse

gross negligence. Negligence has been well defined as:
The want or absence of ordinary care; that is, just such care as a reasonably prudent and cautious man would exercise under similar circumstances.
Another definition is:
A failure to do what a reasonable and prudent person would ordinarily have done under the circumstances, and the honest endeavour to use the means reasonably necessary to avoid injury to others.
After all the warnings and notices of fraudulent transactions I say that no more fitting and pregnant language could be used in describing this case, than is found in the two terse definitions I have just quoted. Mr. Fielding was a man of splendid attainments. He had had his warnings and there is no excuse for his lack of knowledge. He knew his duty but he failed to do it. He said that when he got Mr. Clouston's letter it was too late because the certificate had already been issued. I dispute that. It is true there was no legal machinery at his hand to recall the certificate, but there is an old adage that there are a good many ways of killing a cat besides drowning, and information could easily have found its way to the public after Mr. Fielding had discovered that he had made a mistake. But no, he sat still. And why? Nobody knows why, but we do know that Travers was introduced by Mr. Calvert and the

mystery of that certificate being issued lies there. It does not do to impute motives, but the attitude of the Finance Minister on that occasion -was absolutely out of keeping with his well-known ability, assiduity, and industry. In this case he did what he was never known to have done before. He had himself admitted that he was suspicious of the institution and that he would like to stop it, but he did not stop it. And why did he not? There is not a sufficient reason, and the disaster came through his lack of action.
Sir William Meredith has dealt with this question at very great length. I need not repeat much of it, but I would just like to quote a sentence or two. On page 8 of Sessional Paper 153a the commissioner says:
My conclusion on this branch of the inquiry is that the Treasury Board was induced to give its certificate by false and fraudulent representations on the part of Travers, and that if the facts I have mentioned as to the way in which the $250,000 was made up had been disclosed, the certificate of the Treasury Board would not have been given.
Mr. Fielding had express notice of fraud, because the facts were disclosed. If he had gone further, he would have had absolute proof. He failed to do that. If he had acted, there would have been no certificate, no bank deposits and no loss. The commissioner speaks about the efficient cause. I have already said in regard to that, and I say it again, that the word * efficient ' is not appropriate; I would call it the 'deficient * cause-the failure to act on the part of the Minister of Finance that brought about the loss in this case.
I pass over the findings at large of the commissioner, because they are all set out in the report, but I wish to make this point very clear. The commissioner says:
I do not suggest that the minister would have been justified because of the information conveyed to him in recommending that the certificate should not be granted, or that the Treasury Board because of it would not have been justified in refusing to grant it.
He is non-committal there.
But having received the information, it was in my opinion incumbent on the Treasury Board to have investigated the charges that had been made before coming to a conclusion as to whether or not the certificate should be given.
That language is express and clear. It carries its own condemnation of the inaction, the negligence, of which supporters of this Bill complain. The next paragraph in the report contains these words in regard to Mr. McCarthy's letter:

, Mr. McCarthy did not in any way intimate that the information he conveyed to the minister as to the way in which the $250,000 had been made up had been found to be incorrect.
- Therefore, it will not do to say that Mr. McCarthy withdrew his writ. The charges were there. They were never investigated, never proved untrue. The charges were never withdrawn, although the writ was. The commissioner further says:
It is true that, as Mr. Fielding stated in evidence, Travers, so far as he knew, was a reputable banker; but that was not, in my opinion, a sufficient reason for not having instituted an inquiry as to the matters which had been called to his attention.
Therefore my argument is in line with what the commissioner found:
Such an inquiry could easily have been made, and the delay occasioned by it would have been inconsiderable, and such an inquiry would, undoubtedly, have resulted in the discovery of the manner in which the $100,000 had been raised and in the refusal of the Treasury Board to give the certificate.
I do not wish to detain the House at any great length with regard to that kind of evidence. The case has been proved abundantly. In fact, it was easily seen by the attempt of the hon. junior member for Halifax (Mr. Maclean) last night how desperate a cause he had, and how utterly unable he was to withstand the salient points brought out by the hon. Minister of Finance.
I wish now to turn to another phase of the question for a moment. The right hon. the leader of the Opposition in the late Parliament, in answer to Mr. Henderson- I do not quote his exact words, as I am speaking from memory- said that this country in a case of this kind ought to be big enough to do justice to these unfortunate people, some of whom had their homes severed by death or by lunacy, and some of whom were reduced to poverty and despair. I know of men in my own constituency, old and gray, who had retired from a hard and arduous life, who had deposited their savings in this chartered bank, not for purposes of speculation, but for safe-keeping, and who were left penniless owing to these savings having been completely wiped out.
This country has in the past treated outsiders generously, as it has the power to do. I might mention the volcanic disaster in the West Indies in 1902; the sufferers in Japan in 1906, when this Government poured out its money; the San Francisco earthquake in 1906, when the Government and this country paid willingly; the Jamaica earthquake in 1907; the earthquake

in Italy in 1909; the floods in France; the Ottawa and Hull fire sufferers; the distress on the Liard and Dease rivers; the Vancouver riots; the Campbellton fire sufferers. There is a list four times as long as the one I have given, and I need not dwell further on the subject. Yet it is said, forsooth, that we should not compensate the sufferers in this disaster so widespread, affecting thousands, of whom some can bear the loss, some are suffering a great deal, and others are absolutely ruined-a disaster in which poverty and distress has fallen upon men and women, Liberals and Conservatives alike. Yet, for some unaccountable reason, where no member of this House would state, although it has been charged, that any attempt has been made to make party capital out of this matter, where nothing exists in the whole situation to warrant party feeling, the hon. junior member fcr Halifax (Mr. Maclean), last night, after condemning the Government for not acting sooner, said that they were now acting too late, and moved the six months' hoist.

Topic:   QUESTIONS.
Subtopic:   THE FARMERS BANK.
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