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Lorsque le document est trop grand pour dtre reproduit en un seul cliche, il est film6 d partir de Tangle sup^rieur gauche, de gauche d droite, et de haut en bas, en prenant le nombre d'images n6cessaire. Les diagrammes suivants illustrent la mdthode. 1 2 3 2 1 3 4 5 6 'TwmiimwBmiiifiFfpmMfiiffliw^^ A QUESTION OF VERACITY Correspondence between SIR HECTOR LAN- GEVIN, Mr. GEORGE STEPHEN, Pre- sident of the Canadian Pacific V^ailway and Mr. L. A. SENECAL, Presiaent of the North Shore Railway, on th^^ purchase ot the North Shore Railway. / \ A QUESTION OF VERACITY. (Correspondence betv\'een «ir PIectok Langevin, Mr. Georoe Stephen. President of the Canadian Pacific Railway and Mr. L. A. Senegal, President of the North Shore Railway, on the purchase of the North Shore Railway. / I A QUESTION OF VERACITY, Correspondence between Sik Hector Langevin. Mr. George Stephen, President of tlie Canadian Pacific Railway and Mr. L. A. Sexecai, President of tlie North Shore Railway, on the purchase ot the North Shore Railway. Sir Hectoh L. Lani.evin. Montreal, ■2-2 January 1MS4. (f/laira. Sir, Il^ne^Bi^acS7r1S^!^-^'f^- '^'^^^ instant, the Province of QueCleli on fh^""''^''^ members of announced that . he ban li^^^ 'i«d the members of Par hamem oV I ^rC ^"'^^^ -.guh. comcidence 1 lud. o„>avi„g Zt'elTX.^Ll 1 i to several friends, among others to M. A. B. Chafl'ee, ono of the friends of the Pacific, my iiilenlion of going to Ottawa wilti the object of adding my weak individual efforts to those which were made in order to calm down public feeling, and I had already began to act in that sense. The only conclusion to be taken from the information given by your- self, set in opposition to my representations for moderation, was that I had been bought in order to have peace and that the members and the newspapers had really been only my instruments, whicn was however quite opposite to the truth. That is what I represented to ynu on that evening and there- fore 1 answered you that ray bonds were not for sale in those circumstances; and that nolhingcould be done without an understanding with the Grand Trunk, adding that it would be in the interest of all, because that understanding would increase the value of the Pacific shares and would protect the government against all necessity of giving them further aid. But to afford you the occasion of proving your good faith, r accepted your offer of meeting Mr. Stephen the following day, happy if 1 could have found in that interview any chance whatever of deciding the Pacific to go to Quebec. This happened four days ago, the feeling in Ottawa has cooled down, but I do not yet feel myself protected against the undeserved and gratuitous imputation which your decla- ration has caused. I do not suspect you of trying to harm me intentionally ; but the harm is there and you cannot deny me the right of asking you now for what reasons you have been the cause of such an injustice towards me, for you ought to have been aware that Mr. Stephen did not wish to meet me, that he had had no interview with me and that what you announced in the caucus about the North Shore Railway and what I was compelled to deny on the same evening, had not been corroborated by the facts of the case. I have the honor to be, Sir Hector, ' • . Your very humble servant, L. A. Seneoal. Sir, Ottawa, 28 February 1884. As 1 have informed you in my note of the '26lh in answer to your letter of the 22nd, received the 23rd, I transcribe here a letter which I received from Mr. George Stephen and which is my answer to your letter of the 22nd. ono of Ottawa 3rts to seling, e only ' your- ration, id that ily my 3 truth. I there- sale in without that it Landing would g them ig your tien the terview Quebec, wa has against IF decla- harm cannot lOns you , for you wish to latwhat Flailway ing, had :necal. Y 1884. n answer ranscribe phen and Here is the letter of Mr. Stephen (( Dear Sir Hector LANr,EviN. "Ottawa, 23rd Feb. 1884. " Referring to oi^r conversation of this morning 1 desire to repeat what f stated to Mr. Pope on Tuesday last, as indica- ting the views of the Canadian Pacific Railway Co., on the question of making use of Quebec as its summer port of ter- minus. "The Company have always sought to reach Quebec, in which you have always concurred and coo perated with them ; and, as you are aware, they offered to purchase the entire line of the Quebec, Montreal, Ottava and Occidental Railway, upon terms which, on the whole, have been more advantageous to the province than those which were accepted. When we purchased the western section of that Railway, wo did not loose sight of Ihe advantage of having a summer outlet for our traffic at Quebec ; and in the agreement for that purchase we made elaborate stipulations for securing the carriage of the through traffic of the Pacific Company to the port of Quebec. In this object we have been defeated" bv the transfer of the Eastern section to the Grand Trunk Rail way Go. which practically renders our arrangement unavai- ling. ^ " The Company however still entertains the same desire to reach Quebec ; and I informed Mr. Pope on tuesdav, that the statement of Mr. Van Home that we are willing to acquire the North Shore Railway is perfectly correct. And that, if in order to do so, it should be expedient to buy that Com- pany's bonds, this Company is prepared to acquire them, as a part of the transaction ; and having learned through you on Friday that Mr. Senecal was in town, and desired to see me on the subjet, I should have made a similar statement to him, if I had met him at the Russell House, where we were both staying. " I have the honor to be, " Dear Sir Hector Langeviu, , " Very sincerely yours. u GEORaE Stephen. Your humble servant, (Signed,) Sir Hector L. Iuxgevin. L. A. Senegal, Montreal, T i Monlroal, 6 March, 1884. Sin Hectoh L. Lanckvin, Minister of Public Works, OUawa. Dear Sii', I thank voii extremely tor your note of the 28lh February, Iransmittiilg me a copy of a letter from Mr. Geo. Stephen, on the question of the North Shore Railway. You will p?»rr^Dn me. I hope, for all the trouble 1 caused you on this subject and which I might still rause yon, because certain newspapers which endeavor to bR considered as your organs, continue to use your remarks in the caucus to maintain their accusa- lions"against me. Tin? rumor published about me was that I intended to compel the Pacihc to purchase my bonds. As the information announced by yourselves was precisely that the Pacihc had decided to purchase my bonds, the conclu- sidn to which newspapers hostile to my projects arrived at, is evident by itself. If my person only was involved in the case I would not take up your time in useless recriminations, but the attack comes from a party very well organized to batter another important section, the most important one of the conservative party ; and, in these circumstances, I believe it my duty to prepare the position which we will be obliged to take sooner or later to prove that we were right. Mr. Stephen's letter shows to me that you were in good faith ; and I hasten to say that my remarks did not apply to you ; but as that letter can cover a me e mananivre, 1 take he liberty of an swering it by the same channel through which it came to me. in order that you may know what stand you shall take on the question and that occasionally you may profit by this information. Jt is false tliat tiie Pacific Company always intended to reach Quebec. In -January and February 1881, the Hon. M. Ghapleau offered them the road from Ottawa to Q lebec, with all its branches for SG,500,000. Mr. Abbott answered that the price was not reasonable. In January IH82, Sir John A. MacDonald, at the leijuest of the Quebec Government, urged on the Pacific Company to reconsider the otl'er of the province of Quebec. The Pacific decided to make the follow- ing offer : — lo. $8,750,000 at \ ,,|" payable at the end of 50 years. io. $750,000 to be spent immeiliately by the province in work on the road. The estimate to be made was plain : as money costs 5 "jo to the province and as it would have derived only 4 -^p) from the urged Pacific, it would begin to lose 87,500 per annum on the exacted disbursements and that during 50 years. The interest of 4 ojo on 88,000,000 gave only S:V20,000 per annum whilst the interest of S^fo on 87,600,000 netl price for which the road was sold, gives to-day S380, 000 per annum viz: a difference of 860,000. You are aware that during 50 years this difference represents an accumulated amount of more than 812,000,000 Or, if yon like to reason in another way, the income of 8320,000 which the Pacific would have had to pay, would have represented at 5 oi" a capital of $6,400,000. The Pro- vince had not the means to loose that; and I can remark, on passant, that the Dominion had not then offered to the Provincial Government to make up the difference, in spite of numerous petitions for aid. When the Pficific purchased the Ottawa section, they recused a new otftjr to sell ihcni the Quebec secijou. They did not even make ai'v oIIVt for that part of the road. In December 1882, 1 offered a-iaiu fhi' North Sboiv Uonl to the Pacific Company for 84,75U,()II0, wheii I knew . , •» the Grand Trunk were ready to pay a more considerable aiiOunt for it. The purchase of important lands and the e.vp'rnaituro of 8260,000 for improvements on the road were wore ;han an equivalent for those 8750,000, th.; more so fhai it wa - fa;. to obtain a pr' f" »f 10 "\n for the sbarehokler.i of the ^ orth Shore Railway, who had incurred ali the risks and 'ar.d not yet rectived a dividend. The Pacific Company reuiseu again and on this refusal. I sold to the Grand Trunk for a higher price. Such is all the desire tlie Pacific expressed to reach Quebec. Mr. Stephen is not right neither when he says that the transfer of the North Shore Railway to the Grand Trunk baffled all the precautions he had taken to insure an outlet at Quebec by that road. There has been no change in the management of the North Shore Railway, the Company are still in existence, they never refused the least advantage to the Pacific, and they cannot, neither, escape a proviso of the law which the legal advisers of the Pacific drifted to suit their own taste. But, the Picific, by closing the Grand Trunk branch line at St. Laurent, has kept Quebec from receiving the traffic of Toronto and of the West: that is all, to my knowledge, that the Pacific has done for Quebec. Moreover, the Pacific has refused in every manner to have the use of the North Shore Road. The Grand Trunk has offered to change the North Shore Road for a railway in the Province of Ontario, it was refused. The Grand Trunk then ofTered to change running powers on different lines. 1 ? 8 they refused again ; but they con tinned to say and have people to say " that ihey are ready to purchase the North Shore Road, wlien they are well aware that the Grand Trunk, if they consider only the wants of their own position, should not consent to sell this road purely and simply without some stipulations in their favor. I do not wish to prophetize, but, you .shall see that all those refusals, accompanied by a false show of good will, will end simply in the establishment of an outlet for the Pacific on South Shore of the St. Lawrence, through the very roads of the Hon. Mr. Pope, who seems to have given you some advice in the present circumstance. I come to the third consideration of Mr. Stephen's letter which concerns me personnally. " If, in order to do so, it should be expedient to buy that Company's Bonds, this Com- pany is prepared to acquire them as a part of the transaction." These lines cover a great malignity. Any railroad man knows very well that it is not necessary to purchase bonds to buy a railway. Shares are bought to have the road, the bonds represent the road it-elf which has been purchased. These bonds are paid if they want the road to be liberated ; if this is not wanted, ihj bonds are allowed to stand without mentioning them ; they have only to pay the regu- lar interests. This extraordinary mention of Bonds when it was perfectly useless to speak of them, had in the minds of the Pacific people an evident object : to say to the conversative members, who held themselves together to obtain an ack- nowledgment of the rights of the Province of Quebec : " If it is to obey the command of speculators that you act so, be satisfied: Mr. Senecal will have his money." Several repre- sentative > understood it so and papers who defend you, have also published comments on your words in that sense. Such is the real injustice I had again to suffer. Time only will put me in a position to believe myself quit with the public, and when ihe share of responsabilities will be made, in a few months or in a few years, 1 will prefer my own than tlie responsahility of those v/ho thought to avoid a difficulty by false representations. I have no other conclusion to arrive at but that one, because there is no other. My duty is to inform you of the facts, in case you had some precautions to take against the Pacific Company, and I have fulfilled it. If you wish to be convinced that Mr. Stephen intended to deceive you, I will tell you that on the very day he wrote to you that he was ready to repeat to me the same thing if he met me, he crossed me several times in the hotel without Jelling me the first word of his projects, which did not seem i have North 'runU, sition, limply lat all . will, or the gh the given letter so, it ,s Com- iclion." id man bonds )ad, the chased, lied ; if without 5 regu- n it was s of the ersalive an ack- 3C : '' If cl so, be al repre- »u, have e. me only vith the )e made, my own avoid a nclusion My duly icau lions filled it. inded to wrote to ing if he without not seem iO Weary him much. .\l prt'scnl llio Parillc lias not iliade ti single allLMnpt to know if tli^'V nan acqnire Ihe Noilli Sliore Road and ihey will ilot do il. The inten,'. c, apparent, at least, wliicli 1 have in ihe Xorlli Shore Railway, hinders nio in the expression of my views, bnt 1 assure yon that pnblic spirit is not so much nbsenl with mc as some people seem lo say and that, as a French Canadian. I enierlain some fears about the position which by the arrangemeils of the Pacific lor a port on the Atlantic will be made lor Ihe Province of Quebec. Sooner or later, Quebec and Monti-eal will he only local stations for the benclil of Portland, St.. John and other sea ports, if you do not use your influence with energy to change the fatal direction which is taken by the International. My bonds, on which, nevei-lheless, I realiz(>d all I wanted, are oC a small interest compared to this great national interest and I shall not die with tlie accnsation of not doing all I possibly could to bailie the project meditated against the French Pro- vince of the confederation. Once more, I thank yon lor having given mo the explana- tions 1 asked. • I have the honor to be, ' , Yoni' very humble servant, (Signed,! L. A. Si.:xi':(:ai.. tCopy Sir, Ottawa, March ITth, 1884. 1 r»'gretlhal my parliann'niary and minislei'ial duties have kept me from answering sooner lo yoiu* letter of the Glh March of which I am in leceipl. 1 have commnnicaled toMr. lleorge Stephens, the contents of your letter and I enclose a copy of his letter of the I llh which lie sent me in answer. As the greater part of yonr letter was evidently destined to Mr. Stephens aloiu', I would be satisfied lo transmit yon his answer, if I did not believe that some [larls of your lettei- exacted a few remarks on my pari. I a'm glad to see that yon acknowledge my good I'ailli in endeavoiing lobiingyou and Mr. Stephen together, allhoujj^i there was no doubt about the mailer. 1^ : 10 Allow 1110 to lell yon that I do not share your feat's of seeing the summer tralHc by the Pacific Railway reach St. John, New Brunswick or some other Atlantic Port. The point on which trade is directed is not a subject of fancy ; trade is directed by laws which will ultimately prevail. ^It is also the interest of those who are charged witli its transport to obey these laws unhesitatingly. Quebec is probably the most beautiful port there is in the world. Its access is free from violent storms for several hundred miles than any port of the Atlantic ; and it must necessarily share with Montreal all the summer oceanic trade of Canada, because it offers the shortest and most economical route. 1 further say that I attach the more importance to the assurances given in this point by the Pacific Company, that it is their interest to put them into effect. This company will have their summer terminus in the Province of Quebec, because they will expend hundred of thousand dollars less than if they had an Atlantic Port. I must also tell you that on this point the action of my colleagues and mine must dispel the extreme uneasinesss which you express on the subject. Our policy is to have the summer terminus of the Pacific Railway in the ProviAce of Quebec, as I have already stated ; and if the Company can- not roach the port of Quebec by the purchase of the North Shore Railway, the Government will assist them in finding oilier means of insuring the success of that project. Now that the object for wht€h this correspondence bet- ween you and I, has been attained, and owing to the impos- sibility in which i am, for lack of time, to continue a corres pondence which has no more aim, as far as I am concerned, I beg, if you have to reply to M. Stephen, that you will be kind enough to address your letters directly to him I remain, Sir, Your very humble servant, (Signed), HECTOR L. LANGEVIN, L. A. Seni^cal, Esqr. Montreal. '>-r ,r feat's of ay reach ort. subject ot lUimately rged wilft. Quebec is vorlil. Its Ired miles irily share of Canada, lical route, nee to the npany, that s company ; of Quebec, dollars less LCtion of my uueasinesss to have the ProviAce of )mpany can- of the North ,m in finding ect. ondence bet- 10 the impos- nue a corres m concerned, It you will be him NGEVIN, 11 Montreal, 11 March 1884. Dear Sir Hector Imngevin, I am obliged to you for oommunicalion of Mr. Senecal's letter of the bth instant ; but I really must decline entering upon the very wide field of discussion which it presents. The Railway Company must take leave to know its own dis- position as to having an outlet in the province of Quebec ; and I repeat that it has long desired ic, and with that view, is now willing to relieve the Grand Trunk Company of the North Shore Railway at a reasonable price. As to the state- ments respecting the negociations for the purchase of the entire Railway, I mnst say that I cannot admit their accu- racy. No offer was ever made by the Quebec Government to sell the road at any special price. Many conversations took place about it unnfficially, at which it appeared to us that the views of the Government continually increased, as the Company shewed a disposition to approach them. But the only actual offer was that of S8,000,000 nelt, made by the ' Company in IH82 : to which it never received any /answer. Under that ofTi^r, I am satisfied the Government could have obtained the $8,000,000 by oifering at par the 4 %, bonds of this Company, secured upon the Railway with the garantee of the Government : and if not. that the Dominion could have been induced to endorse Ihem, as an accommodation to the province. >In this way, the province'would jiave had $400,000 more than it actually got for the two sections. When the Company bought the Eastern section, I was in England ; but I understand that tlio negociation was opened on behalf of the Government, for the Eastern section only. I cabled my friends that we should endeavor to obtain the whole line ; but was informed that it was politically impracti- cable to deal with that at all. If the entire railway had then been offered to the Company for $7,600,000, 1 Iiave no doubt the offer would have been accepted. As to afterwards acquiring' it, Ij.learn 'that it has been bonded for $ I, '250,000 above the Government price ; and any purchase now would cover the entire bonded debt, unless the surplus over the government mortgage could ho go! at a reduced rate. This was, of course, my meaning in speaking of the bonds, as a part of the transaction of purchasing the Railway. And this Company cannot buy the North Shore Railway, while those bonds are held at par, or near it, simply because it would be paying more than the value of the property. n 1i? oEFered lo me in exchange for Canadian Pacific Stock, by a written menioratuliim (of which 1 enclose yon a copy) handed me on the nltimo by one of yonr colleagiies, who inform- ed me that he was reijnested lo do so by Mr. Dansereaii on Mr. Senecal's behalf ; bnt I declined the proposal. And as to crossing Mr. Senecal in the Rnssell House, I can only repeat that I did not meet or see him in the Russell House, after the interview with Mr. Pope mentioned in my letter. 1 think I need not refer at any length to the statement that this Company can still send its traffic to Quebec over the North Shore Railway, upon the conditions fixed by its contract with the Goverument. The present holders of that road are using every etlbrt to force their through traffic to and via Ottawa, over the Canada Atlantic Railway, instead of over the Railway of this Company; and have recently notified us that they have fi.xed at "greatly increased rate upon the through cars, all in direct violation of the contract. And they are now attempting to force a passage over this Company's road for Grand-Trunk locomotives, hauling trough trains from and to the Jacques-Cartier Union Rail- way, to constitute a through line by the Grand-Trunk instead of by this Railway. In conclusion, I would say that 1 must decline to enter in- to any further controversy in this matter ; and that T have only trespassed upon your time at such length, that you might, not be h-h in any doubt as to the position and inten- tions of this Company. If you wish me to make a reply to what seems to be the point of Mr. Senecal's leiler, namely, that you should ui'pfe upon this Company the purchase of the North Sliorc R lilway, at a price which would include, at par, the bonds outside the Government price, 1 can only say that this Cnm|Kinv cannot consider that proposal, because an equally advantageous route to Quebec can be obtained ou much more lavurable terms. •cinain Dear Sir Hector Langevin, ; Very ti-uly yours (Signed,) (iEonuE Stepiikn. The Honorahlc Sir Hector liaiigevin, C. H. K. C. M.G., etc., etc., , ' ■ Ottawa. ! 18 -, by ^ landed nform- ■eaii on d as to repeal e, after xiemenl ec over by its of that raffic to instead recently sed rate contract, over this hanling on Rail- k instead enter in- lat I have that you nd inlen- a reply to [•, namely, nrchase of d inchide, can only al, because btaiued ou EI'HEN. AN OPEN LETTER. Montreal, •2nd April 1884. Sir Hector L. Langevin, Ottawa^ Dear Sir, I have have the honor of receiving your letter of the 1 7th March. lo. Transmitting to me a copy of a second letter from M. Stephen. 2o. Exposing to mo the views of Iho Government of which you are a member on your railway policy. 3o, And lequesting rne finally lo communicate with Mr. George Stephen, although this gentleman's letter, transcribed in your own hand writing, says that lie" declines to enter into further controversy." Allow me to disagree witii you on your suggestion to address myself to a man who act{uaints you with his deter- mination not lo listen to what will be told to him and not to answer, and so much so since I have nothing to discuss with Mr, Stephen. My only recourse is to write to you in the news- papers. I do itieluctantly, but it is my duty to do it, because the object of this correspondence, as it is explained in my first letter, is merely to know what reasons you had to use my name in a manner which was particularly prejudicial to me in a meeting of French Canadian Conservatives at Ottawa and why you have asked to have explanations with me on the subject. The leason which you have had tiu^ kindness to communicate to me was merely a letter from Mr. Stephen. If r have discussed that letter it was only in your point of view and on your occasion and lo prove lo you that if you had been in good faith, you Had al least been brought into error. Since you tell me that you do not see the necessity of being informed on the con-ectness oi your declarations and that you request me to continue lo make that demonstration to your neighbour, we must also suppress llie ordinary for- mula which it pleases one lo express and which it pleases more to receive on cons(ueiitious inlenlions and good faith. If it is no more allowed lo either of iis, to make any mistake in the nature of the incident caused by you and taken up by me, I will be obliged to consider your remarks before oni- Ottawa friends as an attack against me as you refuse to take from them the fatal signihcance which has'biien brought in by your reticence and Mr. Stephen's mental restrictions. "^^Srw^^ |.||, 14 I take the position siuli as it was then with its actual wants Surely, nobody had asked you to busy yourself with my interests. Now there only remains the presumption that the pressing wants of the moment were to annihilate a lower- canadian move which was patriotic but embarrassing for you. I record, to avail myself of it subsequently, all that is erfuivonal in that mancBuvre. What was your object in sending Mr. McMillan after me at the hotel, where I was far from dienming of such things ? What was your object when you met me, not in your room, but openly in the Library, if It was not to leave every body think that the calm of a certain part of the representatives depended upon the fart that my private interests were satisfied ? Since I received the two letters from Mr. Stephen, 1 understood to what extent yon were not anthorized to interview me on that subject and I am asking myself how you did not even know what Mr. Stephen wanted. ' Do not forget that your words at the caucus were th^ following : " I have the pleasure of informing you that Mr. Stephen, the President of the Cana- dian Pacific Railway, is in Ottawa and that he will purchase the bonds of the North Shore Railway." Do not forget also that it is evident from Mr. Stephen's" letter that it was only Mr. Pope and not you that he saw ; and if you read again Mr. Stephen's letter of the 1 1 th March you will find that the meaning of his letter was that the Pacific was not prepared to purchase my bonds '' unless the surplus over the Govern- ment mortgage could be got at a reduced rate," that is to say that it did not want to purchase them at all. That letter flatly contradicts your assertion in the caucus, particularly in the following words : -' The portion of those bonds in the hands of Mr. Senecal was offered to me in exchange for Canadian Pacific Slock ; hut I df dined the proposal." You, you have said : " Mr. SLejthen will purchase " and Mr. Ste- phen puts down in writing : " I declined this Company cannut buy the North Shore Railway until those bonds are held at par or near it, simply because it would be paying more than the value of the property." Without discussing this olTer at present,' I am aware that somebody ask^d lor mo, at a time when that request was vqh- souablo, $l,-25(),()00 in shares of the Pacific for $750,000 being my share of bonds. As the Pacific was then 52on the exchange, they had then asked S()50,00() for my bonds, viz 86^. And I must add that shares have an eventual character which bonds have not. A thousand transactions can reduce a slock to an insignilicant value ; obligations bearing a mortgage on inmioveable pioperty always remain what they are and in 15 actual [with n that lower- ing for Lhat is ject in vas far ;t when rary, if Im of a he fact eceived what on that n know words at asure of le Gana- )urchase i-get also vas only ad again that the prepared Govern- is to say Iter flatly ly in the he hands Ganadian al." You, , Mr. Ste- this itil those would be >vare that ;l was rea- ,000 being- exchange, 162/3- And ter which uce a stock orlgiige on are and in the present case bear with them moreover the guaranleo of a powerful Company. Il was then not, (he par or near it that was asked for my bonds, and whilst the Pacific refused this easy ofler yon said that they were goins to purchase these same bonds, wilhout speaking of any restriction. Yon will not plead ignorance of the fac-ts. when the agreement, mortgaging the North Shore Railway for an additional debt of $1,225,000 was brought up last year before the B'ederal Parliament and forms part of your Statutes. Neither you in the caucus, neither Mr. Stephen in his first letter, anticipated that those bonds, which existed to your knowledge, would be an obstacle to the liansactioii. You did even insist only on the purchase of the bonds. The sequel will learn you, let this be said en passant., that this oiler had been made before the proposed lo;in of $30,000,000 by tlie Pacific was announced. As soon as I saw the resolutions mortgaging all the properly of the Company and putting it at the disposal of the Govern- ment, I considered them as disastrous for the Company's stock and 1 could not for an instant dream of such a trans- action between the Company and myself, specially when I dissaproved the arrangement between the Company and Government. But now the only question is the refusal of the Pacific to take these bonds at 86; 3. This refusal proves that I had a reason to doubt il not the sincerity at least the correctness of vour afQrmation and that vou alone are bound to establish this sincerity. 1 am so much the more authorized to insist on this point that on that day I considered your declaration very serious as I believed you were really authorized to make me that offer and 1 refused it positively unless there should be a perfect understanding with the Grand Trunk with whom I was bound and who alone could pass the North Shore Railway to the Pacific or put it at their disposal, as they consented subsequently. This refusal, at the very moment 1 trusted your word, is the answer to the imputations derived from the offer made through Mr. Dausereau, imputations brought forward in Mr. Stephen's letter as a threat against me ; for your papers have already repeated that it was only deception that inspired me to act against the Pacific. I enclose Mr. Dansereau's explana- tions which must forcibly form part of this record when it will be published, since Mr. Stephen brought him in the case ; and although I would have ratified any arrangement he would have made for me, 1 must state that we easily agreed togetlier on the impossibility of carrying into effect an offer made before the resolutions on the loan. Allow me to thank you lor the honor yuu did me by expo- I() sing to nie the govermenl'a policy on railway qnestions. I would have never had the presuinjilion ol' meddling myself with those impoitaiil (jiieslions. J only mentioned by the way a project to turn oil' the trade ol' the Pacific from Montreal and Quebec ; not because I have advices to 'ender you, but in order to draw your atleution to the fact that it is diliicult to uuderstaud how Mr. Pope, the southeru railroads man, could take the part of the North Shore on this question against his own interest. As to the policy of your govern- ment, 1 never thought of criticising it nor being astonished at the fact that instead of inducing the Pacific to purchase the North Shore Railway you gave $6,000 or $12,000 per mile, I do not know how much, to a projected railroad. 1 would be the last man to rebuke you for that project if I did not find in it an attempt to cover it by an imaginary impossibility which some persons try to attribute (o me and turn away' public opinion from its real object. I have no reason to become, without any mission, the defender of the interests of Quebec, which cannot, however, be jeopardized if the law of trade is such as you represented it and if it is not necessary to make any particular effort in order that Quebec may enjoy all the traiiic which its port deserves. Far from rendering the purchase of the North Shore Rail- way impossible, 1 have on tin; contrary made it the most easy. My dealings with Messrs. Hickson and Waiuwright have put me in a [>osition to ascertain their views and their disposition and 1 have intimated to you and 1 informed some of your coileaj^ues of the fact that the Grand Trunk, to realize the wishes of the Government and to become agreeable to the Quebec representatives, would be willing to sell the North Shore Railway at cost price. The Grand Trunk has also offered, in case the purchase should not be expedient, to grant as far as Quebec running powers for the locomotives and the trains of the Paciiic, and with the use of its terminus at deep water and in order that the Paciiic would have the assurance of not being troubled in the enjoyment of the privilege, to refer all disputes to the decision of the Government; so that with- out being obliged to spend a cent, the Pacific could use the North Shore Railway as if it were their own properly. 1 will further s;iy, to follow you on the ground covered by your letter, thatif itis deemed expedient to drop the prey for the shadow you will not yet llnd the solution of the pronlein which Quebec is seeking so long as you will not take the means of controling the goodwill of the Paciiic, who succeeded in obtaining, under a diguised form, a vote of three millions to go South. 1 will also remark that if vou relv onlv on the lions, i myself ho way oiilreai )u, bill dimciilt Is mail, jueslioii goveni- ished at lase ihc • mile, I ould be not fxnd )ssibilily I'll away eason to erests of e law of lecessary ay enjoy ore Rail- the most linwri^ht and their lied some to realize ,ble to the ,he North sO oflered, it as far as e trains of cep water urance of ;e, to refer that witli- Id use the i:overed by le prey for le problem 3 the means succeeded •ee millions )iily on the 17 fact that Quebec must have the trade of the Pacific because that port is by sevei'al hundred miles nearer the Pacific Ocean than, any other port on the Atlantic and because its access ix free from riolent storms for several hundred miles I can assure you that Montreal having the same advantage, with hundreds of miles more, never could, in spite of its geographical position, dis- pute the Western trade to New "Vork. Something more is needed than the efforts of nature to establish trade currents. And, according to your theory, now that Montreal has obtai- ned the deepening of Lake St. Peter, it should have all the summer traffic of the Pacific. I will ask you why, if your theory is complete and if geographical position is the princi- pal element of success, the traffic would make 160 miles more by rail to reach Quebec when all the requisite ships are in Montreal ? If you say that the distance of 160 miles is hardly anything, I will answer you that in this case if traffic is allowed to run over 160 miles more to reach Quebec, it can equally go to Portland, for instance, where there are hardly any costs for pilotage. I expose you these things only to demonstrate to you that the great secret of success in a com- mercial enterprise is the work of man and not the gift of nathre. And the day when the Pacific shall have investeil five or six millions in their Southern roads, they could very well after being in possession of their winter road, use it for their summer traffic. I believe that Mr. Stephen has not the intention of cons- tructing a first class road, if he is not disposed to pay $5,225, 000, say 05,100,000. to go from Montreal to Quebec. The entrance of the North Shore Railway into Quebec costs alone over $1,000,000. The bridges, comprising 3,500 feet of wood and 4,176 feet of iron, weighing 4,458,198 lbs. have cost over $1,000,000; We have, according to in- ventory, paid $600,000 for the rolling stock which is as in a good state as in the month of July 1882. There re- mains then, after deducting of those $2,600,000 which repre- sent an intrinsic value independent of ordinary railroad works, the sum of $2,500,000 for the construction of 209 miles of railroad which constitute the North Shore road. That gives $13,000 per mile. If we consider that a road built in the prairies of the North West costs $20,000 per mile, with- out bridges or rolling stock, I am asking myself how can a second road be constructed between Montreal and Quebec on better conditions than those. Mr. Stephen could not know what was going on in 1882, at the time of the sale of the railway, because he was absent from the country ; but he is under a false impression when he 18 says that the Pacific would have purchased the whole road if it had been offered to him for $7,600,000. That offer was made to the Pacific, at the request of the Hon. Mr. Chapleau, 1 believe, or rather I know that Sir John A Macdonald inter vened lo urge on these gentlemtMi to acquire all the Q. M. O. 5: 0. and 1 know also that at a recent meeting of the con- servatives at Ottawa, tiie Premier of the Federal Government declared openly '■'■ that in refusing these offers, the Pacific had commited an enormous fault." I nm, moreover, infor- med that Mr. Angus and Mr. Stephen admitted to Mr. Cha- pleau that the Company would have purchased the East Section at the time, but one of tiieir partners was completely opposed to the transaction. I regret also to be unable to accept Mr. Stephen's affirmation lo. That the North Shore Railway had broken the terms of the contract for an exchange of traffic. 2o. That the Grand Trunk tried to pass its engines over otthe"^l. Martin branch. I enclose herewith a memorandum from Mr. A. Davis who dis- poses of the first accusation. The North Shore Railway will I'igorously respect all the obligations of the statute and it is in my capacity of President of the North Shore Railway tliat I make you that declaration. As to the second point, it is the locomotives of the North Shore Railway that we wish to bring from Saint Martin to the Junction of Saint Laurent, as we are authorized by law. In all that, there never was a question about the engines of the Grand Trunk and I really do not understand how Mr. Stephen can be lead into error to that extent and transmits you that error without any verifi- cation. I suppose that you hav^^ remarked like myself, in Mr. Stephen's letter, his want of correctness when he says that the Government could have negociated at par $8,000,000 of bonds in the Q. M. O. ^ O. with the endorsation of the Government. I really bdieve that the Government could have negociated the $8,000,000 even without the con currence of the Pacific. But it is not the authority of the Pacific Company on th^ monetary market which wonli have been of some value for those "negociations. since the shares of that Company, guaranteed by the federal Govern- ment, cannot find more than 5tj. 11 the Government could onlv realize by their gnarautt'p, they could equally have taken the offer of Sir Hugh Allan, who offered the same amount, on the same terms, without ex icting an additional expenditure of $750,000. But with that guarantee, the railway would not have been considered as sold and the Province of Quebec, instead of obtaining a discharge from a mortgage of 19 e road er was apleau, d inter Q. M. He con- rnment Pacific ', infor- V. Cha le East ipletely i-matioii erms of ! Grand )ranch. I who flis- vvay will ind it is Railway point, it we wish Laurent, rer was a 1 I really nto error my verifi- If, in Mr. says that )00,00O of )n of the ent could the con hority of ch wouli since the il Govern- lent could lally have the same additional he railway 'rovince of Lortgage of $7,600,000, wouli have increaserl its liabiHtv for an additional amount of 88,750,000. Then afterwards, where could 'the Quebec Government place these 8S,000,000 to obtain 5 "r,, interest. They had hardly 62,000,000 to disburse since that lime and they would now be vainly seeking an investment at 5 '•[,, for 86,000,000. I naturally protest against tlie conclnsion of the letter of Mr. Stephen who pretends to find in mv letteis the desire of urging you to have my bonds of the North Sliore Railway sold. Since I refused, ifrom the first day, to accept your offer in as much as I was concerned, it was not to harass yon in future on the subject. But there was a quesliuii of veracity and good faith to settle and I believe il is now settled. M.Stephen also " declines to enter into any further con troversy on this matter" which goes to prove that he has a very great disposition to justify your assertion that the Pacific are wiUing to purchase the bonds of the North Shore Railway or the North Shore Railway itself. Are you able to tell me on what day the Pacific made an offer to anybody, not for the purchase of my bonds, which are nothing in "^the question, but for the purchase of the North Shore Railway ? which is a great deal, considering the promises made by M. Van Home and repeated to you in order to keep the members of Parlia- ment in a false security. All things considered, Honorable Sir. here is the position : During, a violent discussion in the press, yon have lent all the authority of a party cliiff to the accusation brought against me : that I intended to blackmail the Pacific company in endeavoring to sell them my bonds of the North Shore Rail- way. As you were not certain of the correctness of what you announced in the caucus, yon call me immediately after Ibis caucus, relying on my probable acceptance of your otfers, to enable you to say thai whit you had announced was true. I peremptorily refnsd any transaction of the kind. In the same time I suggested you the means of obtaining from the Grand Trunk the possession of the North Shore Railway to make it the terminus of tlin Pacifu\ I asked you afterwards the reasons why you caused a cry of distrust to be uttered against me by my friend? at a solemn moment for the Province of Quebec. You have communica- ted to me as your answer a letter from Mr. Geo. Stephen who informed me that he had not even seen you on the subject, but that he had told another party certain indefinite things, a version of which could be arranged subsequently, things that could be even denied afterwards if it was thought pro- per. I answered you that the letter did r.ot justify your assertion in the caucus, since it was becoming more and more certain that the Pacific never thought of purchasing the North Shore Railway, in spite of their declarations, as they never made a move in that direction. You have transmitted to me a second letter from Mr. Ste- phen showing beyond all doubt that your assertion in the caucus was just as- incorrect as I told you. Compare yourself the text of two letters from Mr. Stephen, to see the contra- diction they contain, and you own condemnation : I si letter (February), I have informed Mr. Pope Tues- day that the declaration of Mr. Van Home that we wished to purchase the North Shore Rail- way was correct ; and that, if, to attain that object, it is expedient to purchase the bonds of the Com- pany, this company is ready to acquire them as a part of thr transaction. '2nd letter (March). As to purchasing the North Shore Railway, I learn that it is mortgaj?ed for $1,250,000 over the mortgage already held by the Government. This Company can- not purchase the North Shore Hailway, so long as those bonds are at par or near par. When Mr. Stephen spoke of purchasins the. bonds of the Company, he then knew, what were their amount was and what was their price since he mentions Mr. Dansereau memorandum. The first letter seems to be in conformity with your assertion ; the second contradicts you positively ; for there are no other bonds in existence than those ; and those he refused to purchase at 86f. This second letter, alTirming that the Pacific intended in 1882 to purchase the section from Quebec to Montreal puts its author in contradiction with Sir John A. Macdonald, who stated publicly that, in spite of his efforts and the repealed requests of the then Prime Minister of the Province of Quebec, he could not then decide the Pacific to purchase all the Q. M. 0. & O. between Ottawa and Quebec. This is why I now hold you responsible for an assertion without foundation preferred in a caucus of political friends under your word of honor as a chief, and that is why I pretend you still needed these last explanations before having the right of declaring a correspondence closed. Ibegthat you will believe that by thus trespassing on your attention I obey an imperious necessity, which I regret v.M'y much, but all the members of parliament are witnesses that I did not begin this incident, that there was no necessity of i>l your id more ng the as they Mr. Ste- in in the yourself contra- :h,. the North that it is ),000 over leld by the npany can- v'th Shore hose bonds ds of the t was and )ansereau onformity ositively ; lose ; and bringing me in tiie cuso and that I do not desorvo iha injurious imputation whicii your words have cast on my charactei'. I remain, Honorable Sir, Your very hnmhlo servant, . L. A. SENibiCAL. N. B. — I understand that you induced some members oi parliament to believe that the $G,000 per mile, taken from the amount which should be paid to the Province of Quebec, are set aside to purchase my bonds. I shall take this occa- sion to tell you that if there is only that, you can without fear give these $G,000 per mile to the Province. The Paci- fic can have the complete use of the Nort Shore Railway, without disbursing a cent, and if there was money to be spent, they would be sure to get the interest, from the re- ceipts of the roads. But I have reason to believe that the $6,000 will taken away from the provincial treasury for the benefit of some oth'^r private individuals. L. A. 8. Montreal, 2nd April, 1884. ilended in itreal puts maid, who } repeated ovince of rchase all I assertion :al friends is why I ore having ig on your egret v.'ry lesses that ecessily of Superintendent's ofRco, Nortii Siiore Railway, ' ■ Quebec, 20 March, 1884. h. A. Senecal, Esq. Place d'Armes, Montreal, Dear Sir, In answer to your communication of the 25lh inst, Sla- ting that Mr. Stephen of the C. P. Ry. accuses this road of having increased the rates of their freight between St. Martin Junction and Quebec in order to favor the Canada Atlantic Railway in preference to the C. P. Ry, I beg to say that such is not the case. Rates have been arranged amicably between the G. P. Ry and ourselves at all times when special ^r «i i^2 I'aieH have been called for, both to points between St. Mai'tiil Junction and Ottawa and west of Ottawa and also through te New-York. I see no reason for any such statement being made, Yours truly, (Signed) A. Davis, Supt. MEMORANDUM ON AN OFFER TO CHANCE HONDS. I have on two ditlerenl occasions tried to induce the Paci- fic Company to purchase M. L. A. Senecal's bonds. The Grand Trunk and the Pacific were in a contUct ; I was aware that the transaction made by Mr. Senecal with the Grand Trunk made him an ally of the Company, while the Government of which M. Chaplean was a member should unavoidably sustain the Pacific. There might arise from this opposition in feelings, either disagreements between two common friends or perfidious insinuations against one or the other from personal or political adversaries. Such were the fears which 1 expressed precisely in the same terms to Sir Charles Tupper at London on the 2d and 3rd November 1883. What has happened since proved that disloyal attacks could be expected. I used all my influence withMr. Senecal to obtain his consent. The result of those interviews was the adoption of a mid- dle term by wich the Grand Trunk and the Pacific would be brought together again, as Mr. 8en6cal while being wil ling to sell his bonds to the Pacific even on unfavorable terms, did not think that he could break ofl' with a friend like the Grand Trunk. Restarted forCanada towards the end of Novenber with the intention of executing this programme, which for a reason or for another was not accepted on this side of the Atlantic. M. Senecal returned to Europe, and was so seriously ill on arriving at London that he had to give up his'visit and business in France and return to America with me at the end of January. Five or six days after our arri- val, he had a more alarming relapse and his friends deemed it m . Mar till through tf, ivis. Supt. ^ONDS. the Paci- he Grand ,vare that lid Trunk vernment ivoidably )pposition common the other the fears ir Charles 3. What could be I to obtain necessary ^) keep hi iH off business for some lime. It is ill these circumstances that 1 went to Ottawa in the liope of inducing the Pacific to purchase his bonds and to decide him to start again for Europe or for the southern States. I submitted a memorandum to Sir GhadesTuppet- the 26th or the 27th of January, Sir Charles Tupper kindly consented to transmit it to the Pacific Company and promised me an answer for Monday the 4th of February. But, the resolutions granting an advance of $30,000,000 were known in the mean time and I never returned to Sir Charles Tupper' s to ask him an answer to an agreement which Mr. Senecal could no more accept : we were all against the project. All that 1 regret is that in the ignorance of the proposed measure, J. uselessly troubled the Minister of rail- ways and made him an offer which a few days afterwards was altogether unacceptable by the person in whose name I was making it. Montreal 26th March, 188-i. Arthur Danskreau of a mid- fic would being wil- nfavorable L a friend :dslhe end rogramme, )u this side id was so give up erica with • our arri- j deemed it imm